Legislature(2005 - 2006)BELTZ 211

05/06/2005 01:30 PM Senate COMMUNITY & REGIONAL AFFAIRS


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 133 MUNICIPAL BOUNDARY CHANGES/ COMMISSION TELECONFERENCED
Heard & Held
+= HB 217 FULL & TRUE VALUE OF TAXABLE MUNI PROP. TELECONFERENCED
Moved HB 217(title am) Out of Committee
+ HB 293 BOROUGH SALES TAX EXEMPTIONS TELECONFERENCED
Moved HB 293 Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
  CSSSHB 133(JUD) AM - MUNICIPAL BOUNDARY CHANGES/ COMMISSION                                                               
                                                                                                                              
CHAIR GARY STEVENS  announced the next order of business  to be HB
133.                                                                                                                            
                                                                                                                                
1:39:34 PM                                                                                                                    
                                                                                                                                
RYNNIEVA  MOSS, Aide to  Representative Coghill,  stated  that she                                                              
had an  amendment, which would  accommodate the petition  that the                                                              
City  of  Petersburg  has  been  working on  for  some  time.  She                                                              
explained that  the Petersburg petition  is by aggregate  vote and                                                              
without the  proposed amendment  this legislation would  stop that                                                              
particular petition process.                                                                                                    
                                                                                                                                
CHAIR GARY STEVENS called a brief at ease at 1:40:58 PM.                                                                      
                                                                                                                                
[Due to  technical difficulties no  recording occurred for  HB 133                                                              
between 1:40:58 PM  and 2:02:00 PM. The full,  uninterrupted audio                                                              
for  HB 133  may be  found at  the  end of  the recording  between                                                              
5:56:40 PM and 6:21:37 PM.]                                                                                             
                                                                                                                                
SENATOR STEDMAN motioned to adopt amendment 1.                                                                                  
                                                                                                                              
                                                      24-LS0512\IA.2                                                            
                                                              Cook                                                              
                                                           10/31/05                                                             
                                                                                                                                
                                                                                                                                
                      A M E N D M E N T 1                                                                                   
                                                                                                                                
                                                                                                                                
OFFERED IN THE SENATE                                                                                                           
     TO:  CSSSHB 133(JUD) am                                                                                                    
                                                                                                                                
                                                                                                                                
Page 3, lines 15 - 20:                                                                                                          
     Delete all material.                                                                                                       
     Insert "the effective date of this Act and that has been                                                                   
initiated  before the  effective date  of this  Act remains  valid                                                              
and     subject      to     AS 29.05.100(a),      AS 29.06.040(c),                                                              
AS 44.33.812(a), and  regulations adopted under  those provisions,                                                              
as those  provisions and  regulations read on  the day  before the                                                              
effective date of this Act."                                                                                                    
                                                                                                                              
There being no objection, Amendment 1 was adopted.                                                                              
                                                                                                                                
MS. MOSS  explained that  the amendment deals  with a  pending but                                                              
not  completed  petition.   If  a  petition  is   pending  on  the                                                              
effective date the old rules would apply.                                                                                       
                                                                                                                                
CHAIR GARY STEVENS called on Fairbanks Mayor Thompson.                                                                          
                                                                                                                                
STEVE THOMPSON, Fairbanks  Mayor, said he had  three concerns with                                                              
the bill and he had stated them during the previous hearing.                                                                    
                                                                                                                                
   1. History: Some of the earliest lawsuits in Fairbanks were                                                                  
     over  annexations  and  the   same  probably  holds  true  in                                                              
     Anchorage.  Nonetheless,  local  adjacent annexations  do  in                                                              
     fact work out to be the best for the communities.                                                                          
                                                                                                                                
   2.  Fairbanks has run out of property and is looking at                                                                      
     adjacent areas  amounting to between 500 and  1,000 acres for                                                              
     community expansion.  The borough  would like to  improve the                                                              
     area  to  the  point  that   it  could  be  developed  as  an                                                              
     industrial   area  or  a   housing  subdivision.   Under  the                                                              
     proposed  legislation, if just  one person  lived in  an area                                                              
     and he or she  voted no that would effectively  put an end to                                                              
     the expansion.                                                                                                             
                                                                                                                                
   3. Services: In Fairbanks 30,000 people live inside the city                                                                 
     limits, but  80,000 people live  in the immediate  area. Jobs                                                              
     are  inside the  city limits  so about  50,000 people  travel                                                              
     into the  community where  they work  every day.  They expect                                                              
     to have police,  fire and ambulance protection  and they want                                                              
     the  roads  plowed  and  maintained.  However,  those  50,000                                                              
     people provide  none of the funding that it  takes to provide                                                              
     the services.  Many people  coming into  town to work  in the                                                              
     community  work  for employers  in  buildings  that are  tax-                                                              
     exempt.   The  Fairbanks  Memorial   Hospital,  the   federal                                                              
     building,  state  court  house,   borough  buildings,  school                                                              
     district headquarters,  and schools are all big  employers of                                                              
     people that live  outside the city and the city  is left with                                                              
     no way  to recover  any costs.  Annexing the immediate  areas                                                              
     around the town  that really are part of  the community would                                                              
     help solve the problem.                                                                                                    
                                                                                                                                
MAYOR THOMPSON referenced  testimony from the previous  hearing in                                                              
which Ms.  Moss said  that people living  outside the  city limits                                                              
contribute  by  buying  drivers   licenses  and  such  things.  He                                                              
asserted  that the  city sees none  of that  money. People  living                                                              
outside  the city  pay nothing  toward general  city operation  or                                                              
for police,  fire or  public safety  officials. Those  things must                                                              
be  considered when  trying to  restrict  sensible annexation  and                                                              
growth.                                                                                                                         
                                                                                                                                
In conclusion  he said  that annexation  can  take place in  about                                                              
five different ways and border annexation simply makes sense.                                                                   
                                                                                                                                
CHAIR GARY STEVENS called on Mr. Roberts from Homer.                                                                            
                                                                                                                                
PETE  ROBERTS,  President, Citizens  Concerned  About  Annexation,                                                              
said  Mayor Thompson  has some  good  points but  he misses  major                                                              
points in  the American  system. In  particular, he's  missing the                                                              
importance of the citizen, he said.                                                                                             
                                                                                                                                
He  related what  happened in  Homer when  politicians decided  to                                                              
triple  the size of  the original  city. Neither  the citizens  of                                                              
Homer nor  the people in  the area to  be annexed were  adequately                                                              
informed or  included in  the process, which  resulted in  a major                                                              
and costly  fight. He opined  that the  people living in  the area                                                              
to  be annexed  need to  be a  part of  the process  and the  city                                                              
needs  to offer  those  people something  other  than  just a  tax                                                              
bill.                                                                                                                           
                                                                                                                                
In  Homer  sales  taxes account  for  two-thirds  of  the  general                                                              
revenue  budget so  anybody who  says  the "out-of-towners"  don't                                                              
shoulder a  burden and  provide for the  cost of running  services                                                              
in the area is sorely mistaken, he said.                                                                                        
                                                                                                                                
MR. ROBERTS urged passage of SB 133.                                                                                            
                                                                                                                                
CHAIR GARY STEVENS asked Mike Black if he had testimony.                                                                        
                                                                                                                                
MIKE BLACK, Director,  Division of Community  Advocacy, Department                                                              
of Commerce,  Community &  Economic Development  (DCCED),  said he                                                              
would summarize the  May 6, 2005 letter he sent  to Chair Stevens.                                                              
[Copy in file.]                                                                                                                 
                                                                                                                                
MR.   BLACK  advised   that  DCCED   has   a  somewhat   different                                                              
interpretation of  the bill than the sponsor.  DCCED characterizes                                                              
HB  133 as  providing  the Local  Boundary  Commission (LBC)  with                                                              
another option for  conducting local action elections  in relation                                                              
to municipal annexations.                                                                                                       
                                                                                                                                
The provisions described  in Section 3 of AS  29.06.040(c) provide                                                              
a list  of methods  for conducting local  action elections  and HB
133  adds the  provision  that a  majority of  the  votes cast  by                                                              
voters residing in  the annexing municipality may  be required for                                                              
approval. The  department views  all the  provisions set  forth in                                                              
AS 29.06.040(c)  as  being independent  of one  another and  it is                                                              
confident of the  interpretation based upon the  historical record                                                              
of the use of Section 3 provisions related to LBC actions.                                                                      
                                                                                                                                
Referencing  Section  5  he  said  there was  an  issue  with  the                                                              
Petersburg  petition, but  it was  addressed  with the  amendment.                                                              
[24-LS0512\IA.2]  However,  under   the  DCCED  interpretation  it                                                              
wouldn't  have  affected  Petersburg  because  the  proposal  only                                                              
provides another option.                                                                                                        
                                                                                                                                
Based  upon DCCED's  interpretation  of the  bill, the  department                                                              
has no objection, he said.                                                                                                      
                                                                                                                                
CHAIR  GARY STEVENS  asked for  his response  to Mayor  Thompson's                                                              
concern  that one  person could  stop economic  development in  an                                                              
annexation.                                                                                                                     
                                                                                                                                
MR. BLACK  replied he would  have some  of those same  concerns if                                                              
the  department   had  interpreted  the   bill  to  mean   that  a                                                              
municipality  could not annex  an area  based on  the vote  of the                                                              
people in  the area  to be  annexed. "Certainly  that would  put a                                                              
severe  restriction  upon  the  ability  of  the  municipality  to                                                              
provide services  to areas  and still  get some reimbursement  for                                                              
the use  of those  services. However,  I don't  believe that  this                                                              
bill will present that problem," he concluded.                                                                                  
                                                                                                                                
CHAIR GARY STEVENS called on Mr. Lemaster.                                                                                      
                                                                                                                                
ALAN LEMASTER,  Gakona resident,  explained that Copper  Valley is                                                              
surrounded by  Valdez, Delta, and  Mat-Su all of which  are either                                                              
a borough  or looking  at becoming  a borough.  He stated  concern                                                              
with the  bill for  reasons that are  different than  the previous                                                              
testimony. The  local REAA is large  and if the bill were  to pass                                                              
it's conceivable  that the area  could be "cherry-picked  to death                                                              
up here."  It would be extremely  problematic if the  pipeline and                                                              
pump station  were picked up  by another  borough and the  rest of                                                              
the area were left to become something on its own.                                                                              
                                                                                                                                
He said he  has discussed the concern  with the LBC and  they have                                                              
said he's not too far off the mark.                                                                                             
                                                                                                                                
MS. MOSS  said she'd  like to respond  to several statements.  She                                                              
suggested  that  the  situation  in  the  Copper  Valley  wouldn't                                                              
change with passage  of HB 133. Under existing  law Mr. Lemaster's                                                              
concerns could be realized.                                                                                                     
                                                                                                                                
Referencing  the LBC  interpretation  of Section  3, she  directed                                                              
attention to  page 2,  line 22. Following  the third  provision at                                                              
the end  of line 22  is the word  "and". The legislative  drafting                                                              
manual says  that "and"  or "or" should  be included  only between                                                              
the  last  two  items  in  a  list  and  not  between  each  item.                                                              
Therefore, each  item should be read  as though it is  a comma and                                                              
the word "and" that is just before the last item is inclusive.                                                                  
                                                                                                                                
Most  of the  roads in  Fairbanks are  maintained by  DOT and  the                                                              
people who live  40 to 50 miles from Fairbanks have,  for the most                                                              
part, built  their own homes  over a period  of time. A  good many                                                              
of those  people also live on  fixed incomes. If the  borough were                                                              
allowed  to annex  property all  the way  to the  Yukon River  and                                                              
begin  charging property  tax,  many of  those  people would  lose                                                              
their homes.                                                                                                                    
                                                                                                                                
She concluded, "  Mayor Thompson - I understand  his concerns, but                                                              
what this  bill is  dealing with is  an aggregate vote  regulation                                                              
that  is  not covered  statutorily.  In  fact  it is  contrary  to                                                              
statute."                                                                                                                       
                                                                                                                                
CHAIR GARY STEVENS called a brief at ease.                                                                                      
                                                                                                                                
MS.  MOSS  asked that  the  bill  be  moved  to the  Senate  State                                                              
Affairs  Committee.  Senator Therriault  had  similar  legislation                                                              
moving  through  the  process  and  she wanted  him  to  have  the                                                              
opportunity to review the legislation.                                                                                          
                                                                                                                                
CHAIR GARY  STEVENS said  he appreciated her  comments and  he was                                                              
sure  that  the  State Affairs  Committee  would  have  legitimate                                                              
concerns. However,  the Community  and Regional Affairs  Committee                                                              
also has responsibility in what happens to communities.                                                                         
                                                                                                                                
CHAIR GARY STEVENS held CSSSHB 133(JUD) AM in committee.                                                                        

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