Legislature(1995 - 1996)
03/11/1996 01:35 PM Senate CRA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
Number 001
SB 287 UNINCORP. COMMUNITY MATCHING GRANTS
CHAIRMAN TORGERSON called the Senate Community & Regional Affairs
Committee meeting to order at 1:35 p.m. He brought SB 287 before
the committee as the only order of business.
Number 015
DEB DAVIDSON , committee aide, presenting an overview on the
legislation, explained there are two capital matching grant
programs in the state today: The Municipal Capital Project
Matching Grant Program and the Unincorporated Community Matching
Grant Program. The purpose of these programs is to:
(1) provide a capital project funding system that is
equitable to municipalities and unincorporated communities
throughout the state;
(2) enhance the role of communities in initiating and
prioritizing the construction of capital projects;
(3) encourage a sense of local ownership in capital projects
by requiring local participation; and
(4) improve the process for making grants for capital
projects by providing a more orderly and thoughtful planning
process that involves the local community, the executive branch and
the legislature.
SB 287 revises the Unincorporated Community Capital Project
Matching Grant to enable unincorporated located within boroughs to
participate.
Currently, when these communities want a capital project, they must
first convince their borough that the project has a higher priority
than those which benefit the entire borough, and has a higher than
projects for other communities within that borough. Once the
project is placed on the borough's list, it then goes through the
state process.
This legislation allows unincorporated communities within boroughs
to apply for a capital projects matching grant provided that the
project and the administering agency qualify on the same basic
terms as the unincorporated communities in the unorganized borough
and have the written approval of the boroughs in which they are in.
Ms. Davidson directed attention to a draft committee substitute
which adds a new Section 4. Currently, unincorporated communities
in the unorganized borough have a 5 percent local share match.
Recognizing that because they are in organized boroughs
unincorporated communities may receive greater benefits, the new
section provides that the local share requirement for
unincorporated communities within boroughs would be the same as the
borough themselves.
Number 080
Summarizing the legislation, SENATOR TORGERSON said the legislation
will allow unincorporated areas within organized boroughs to
participate in the matching grant program. Criteria includes
approval of the community by the borough assembly, project approval
by the borough assembly, and the local share match must be the same
as the borough's local share.
Number 105
MARK HICKEY , representing the Lake & Peninsula Borough, directed
attention to a letter from Walt Wrede, borough manager of the Lake
& Peninsula Borough, which states the borough sees SB 287 as
helpful bill which corrects an inequity in the current program.
Mr. Hickey noted there are 17 communities in the Lake & Peninsula
Borough, 11 of which are unincorporated. Last year the borough
received approximately $44,000 to spend on those 11 communities,
which, when divided up, was about $4,000 per community, as compared
to the $25,000 that the unincorporated communities otherwise get
who are outside boroughs. This year the cut would be $25,000 for
those 11 communities, and at $2,000 a community, they can maybe
take the top priority or two. He said the current setup penalizes
an area that incorporates as a borough in terms in how it treats it
unincorporated communities, and SB 287 will correct that inequity.
Mr. Hickey stated he has not seen the committee substitute, but he
understands what the provision would do and he believes the 30
percent match for their borough is fair.
Number 145
KIM METCALFE HELMAR , representing the Department of Community &
Regional Affairs, stated SB 287 addresses the department's policy
concerns by requiring that a borough have a significant role in the
planning and development activities within the borough. In terms
of fiscal impact to the department, the addition of an estimated 60
communities to the Unincorporated Community Capital Match Program
will double the workload of existing staff and will necessitate the
addition of a Range 13 grants administrator position.
Number 160
LENA SIMMONS , Grants Administrator, Department of Administration,
stated that administratively the legislation would not have an
impact on their department. However, depending upon how the
Legislature decides to fund the program, it could cause a decrease
in the allocations to the municipalities if the same dollar amount
is appropriated this year and split between the unincorporated side
and the municipal side.
Number 185
TENA BAVARD , Grants Administrator, Department of Community &
Regional Affairs, said the legislation would double the amount of
eligible communities and it could potentially triple or quadruple
the amount of work. She explained a grantee is allowed multiple
projects with the dollars that they get each year, and there is no
way to estimate the amount of workload.
Number 205
SENATOR TORGERSON said another option would be to make it a pure
grant program with a maximum of $25,000. There would be a criteria
and the communities would have to compete for the grant program.
He asked if the department would prefer that type of an approach.
MS. BAVARD responded that never having a done a program of that
type, she is not sure what the impact would be to her specific
office.
SENATOR TORGERSON asked if the Administration supports the
legislation. MICHAEL CUSHING of the Division of Municipal &
Regional Assistance, DCRA, responded no one from the department was
present who could give a response to a question which really speaks
to departmental policy. Speaking to Senator Torgerson's suggestion
of a competitive grant program with a $25,000 maximum, he said it
would essentially be like their Rural Development Assistance
Program, which has $100,000 per community. He also pointed out if
there were 60 new participants in the unincorporated matching
program, there are two things to keep separate in mind: one is the
programmatic changes and on the other side is the appropriation
concept. There are two programs within the capital matching grant
program, and how they are funded is entirely up to the Legislature.
In the past, the unincorporated side has been fully funded, but on
the municipal side, whatever was left of the overall appropriation
to the capital match program went to the municipal side.
SENATOR TORGERSON asked if under the capital matching grants
program, eligible communities could accumulate up to $125,000 over
a five-year period. TENA BAVARD acknowledged that was correct, and
she added that if the funds are appropriated by the Legislature,
the money is automatically put into their community account, if the
community was eligible the prior year.
Number 330
SENATOR TORGERSON commented what he is trying to do is to change
the system into a grant driven system to where a community comes in
with a project, and, if certain criteria is met and the project is
approved, the money is given towards the project regardless of
whether the community is inside or outside a borough without
changing any of the appropriation process.
MICHAEL CUSHING pointed out the money is held by the department in
an account in the community's name, and when the community comes up
with a plan and the matching funds for a project, then they can
receive the money. SENATOR TORGERSON said his point is that it is
money driving a project instead of a project looking for money,
because every unincorporated community knows that money is sitting
there and knows it doesn't go away for five years.
Number 364
SENATOR HOFFMAN stated he would favor leaving the program as it is
in current statute and to make the changes originally contemplated.
SENATOR TORGERSON reiterated his intent is to make the program into
a pure grant program whereby all the communities will apply for a
grant, and the automatic hold-over of $125,000 won't be a part of
it. The project would have to be approved before a community could
accumulate the money.
Number 390
SENATOR HOFFMAN asked what type of criteria would be used to
evaluate which community would get a project. SENATOR TORGERSON
answered it was his intent to let the department draft the criteria
that would be needed.
SENATOR RANDY PHILLIPS asked how the communities make decisions on
their priority projects. TENA BAVARD responded they have community
meetings, and they have to submit their priority project by
resolution by a certain date.
Number 415
SENATOR KELLY questioned if any consideration has been given to the
fiscal note on the legislation. He suggested the program could be
made self paying by having the community pay an amount for every
grant that was awarded so that it was program receipt money paying
for the program and not general fund money. He added that anything
that impacts the general fund will have a problem in the process.
MICHAEL CUSHING briefly discussed the department's selection
process and evaluation of potential new applicants, and he said
they may have to install regulations so there is a process that's
recognized in place where a borough would have a participation in
the selection of which communities are recognized by a borough. He
pointed out the borough has the right to recognize the entity, but
it's not clear in the legislation that the department can then say
the entity does not meet the criteria and is not eligible. SENATOR
TORGERSON agreed that provision may have to be put in a new
committee substitute.
Number 487
SENATOR ZHAROFF asked if there is an appeal process for a community
that may want to participate in some degree, but is denied by the
borough and the department. MICHAEL CUSHING replied there is no
such provision in the legislation and the department might have to
provide for such a process through regulation. SENATOR TORGERSON
commented there is already the administrative appeal process that
is currently under regulations, and he wasn't sure he would want to
set up something more.
Number 505
There being no further testimony on SB 287, SENATOR TORGERSON
stated a new committee substitute would be drafted to reflect the
discussion on the legislation and that it would be back before the
committee at its next meeting. He then adjourned the meeting at
2:12 p.m.
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