SB 359-MUNICIPAL ORGANIZATION GRANTS                                                                          
                                                                                                                                
                                                                                                                                
CHAIRMAN  TORGERSON announced  the legislation  was introduced  at                                                              
the request  of the City and Borough  of Haines. It is  actually a                                                              
finance matter on whether or not  the state should help defray the                                                              
cost of  mergers and consolidation.  The language mirrors  what is                                                              
in  existing  statute  for  boroughs  to  incorporate.  There  are                                                              
expenses associated when a municipality  "merges up" and the state                                                              
should probably be a part of that.                                                                                              
                                                                                                                                
                                                                                                                                
ROBERT VENABLES  testified on behalf  of the Haines  City Manager,                                                              
Marco  Pignalberi  and  the  community  of  Haines.  He  read  the                                                              
following into the record:                                                                                                      
     I  have  lived  in  Haines  since  1984  and  have  been                                                                   
     involved in  numerous projects and committees  on behalf                                                                   
     of  the  City of  Haines,  the  Haines Borough  and  the                                                                   
     Haines  Chamber  of  Commerce. But  the  most  important                                                                   
     community project to date in Haines is consolidation.                                                                      
                                                                                                                                
     For  the Haines  community, consolidation  is the  first                                                                   
     step toward achieving a home  rule government. SB 359 is                                                                   
     a  measure  that  will  help   us  transition  from  two                                                                   
     disparate   local  governments   into   one  home   rule                                                                   
     government.                                                                                                                
                                                                                                                                
     Haines has the only third-class  borough in the State of                                                                   
     Alaska.  It was designed  as a  compromise mechanism  to                                                                   
     allow for  school funding after  the citizens  of Haines                                                                   
     voted  three times  against  forming a  first or  second                                                                   
     class  borough. While  the third class  borough form  of                                                                   
     government seemed  to work for some time, it  was just a                                                                   
     matter of  time before its  inadequacies caught  up with                                                                   
     it. And now,  when there is a desire to  consolidate the                                                                   
     two  governments, we  find that  the task  before us  is                                                                   
     quite daunting.                                                                                                            
                                                                                                                                
     What  has evolved  in Haines  is  two very  incompatible                                                                   
     systems  of government. This  community of 2,418  people                                                                   
     has  two legislative  bodies (Assembly  & Council),  two                                                                   
     mayors, two planning commissions  (five if you count the                                                                   
     two service  area boards and the state's  responsibility                                                                   
     in  the outlying  areas of  the  borough) with  separate                                                                   
     comprehensive  plans, two legal  systems, two  financial                                                                   
     systems,  two personnel systems  and two very  different                                                                   
     computer systems that do not  integrate with each other.                                                                   
                                                                                                                                
     At our local election, last  October, the voters elected                                                                   
     new  mayors  and  implemented  a  city-manager  form  of                                                                   
     government.  This has  removed many  of the  contentious                                                                   
     personalities  and issues that  caused consolidation  to                                                                   
     fail in  1998 by  three votes. Our  two mayors and  city                                                                   
     manager  have   worked  hard   to  forge  a   spirit  of                                                                   
     cooperation that better represents  the community's best                                                                   
     interests.  It is  the consensus  of  all our  political                                                                   
     leaders  that  one  local government  can  serve  Haines                                                                   
     better  than the  current  two governments.  This  holds                                                                   
     great promise for the passing of consolidation.                                                                            
                                                                                                                                
     The  Local  Boundary  Commission   approved  the  Haines                                                                   
     consolidation  proposal last  week and  the division  of                                                                   
     elections  has scheduled the  vote for consolidation  to                                                                   
     be held on  June 25, 2002. Transitional funding  will be                                                                   
     needed in  order to accomplish the consolidation  effort                                                                   
     in a timely and professional manner. It is a                                                                               
     significant challenge to maintain  government operations                                                                   
     while   simultaneously   changing    every   aspect   of                                                                   
     operations. Our  plan is to use consulting  expertise to                                                                   
     merge  our systems  of  accounting and  finance,  taxes,                                                                   
     legal  and   code  revisions,  comprehensive   planning,                                                                   
     platting   and   zoning,   computers   and   information                                                                   
     technology and personnel.                                                                                                  
                                                                                                                                
     The consolidation of the Haines  Borough and the City of                                                                   
     Haines will  be in  the best interests  of the State  of                                                                   
     Alaska.  Having one  government  in Haines,  instead  of                                                                   
     two,  will  create  efficiencies   in  the  interactions                                                                   
     between the State of Alaska  and Haines. It will relieve                                                                   
     the state government of the  responsibility of providing                                                                   
     some of the  local services while promoting  the maximum                                                                   
     level of local self-government.                                                                                            
                                                                                                                                
     The Local  Boundary Commission  is on record  supporting                                                                   
     both the creation  of new borough governments  and good,                                                                   
     sound   local  governmental   units.  Current  law   (AS                                                                   
     29.05.190)  provides   funding  for  new   boroughs  and                                                                   
     unified  municipalities. A borough  consolidated from  a                                                                   
     third-class  borough  and a  city  is not  eligible  for                                                                   
     funds at  this time.  Many governmental experts  believe                                                                   
     this to be an oversight.                                                                                                   
                                                                                                                                
     Both  the City  of Haines  and the  Haines Borough  have                                                                   
     endorsed  the  consolidation   effort  and  are  working                                                                   
     together  to  insure that  it  has  the best  chance  to                                                                   
     succeed.  We would  ask  the committee's  assistance  in                                                                   
     making this hope a reality.                                                                                                
                                                                                                                                
There was no further testimony.                                                                                                 
                                                                                                                                
                                                                                                                                
CHAIRMAN TORGERSON asked for the will of the committee.                                                                         
                                                                                                                                
SENATOR  AUSTERMAN made  a  motion  to move  SB  359 and  attached                                                              
fiscal notes and individual recommendations.                                                                                    
                                                                                                                                
There being no objection, it was so ordered.