Mayor vetoes fiscal notes

Posted: Monday, March 21, 2005

Kenai Peninsula Borough Mayor Dale Bagley used his veto pen Tuesday, negating an assembly measure requiring the administration to summarize the estimated economic effects of future ordinances that could be expected to have impacts on the finances of the borough or the private sector.

Bagley said he was concerned about saddling the finance and legal departments with the added work of compiling such "fiscal notes" when each department was losing staff.

"The required additional work in compiling accurate and detailed fiscal notes, when a lot of information is subjective and/or speculative in nature, will add to the departments' workload," he said in a formal veto message to the assembly.

Bagley also expressed concern about the heat the administration might have to take from assembly members or private citizens who might disagree with the fiscal note information.

Ordinance 2004-35, enacted March 1, required that fiscal notes accompany all ordinances that would be expected to have an economic impact on the borough's costs and revenues in excess of $30,000 or that would impact the private sector.

For the borough, the law required summarizing an ordinance's anticipated effects for the current and succeeding four years, including implementation, capital, operation and maintenance costs, changes in revenue, impacts on existing programs, the source of funding, personnel requirements, as well as the fiscal effects of not passing the ordinance.

For the private sector, summaries were to be a description of economic effects that could reasonably be expected to occur, including such things as costs or opportunities to individuals and businesses, the availability of goods and services and possible effects on employment, property values and population.

The ordinance was based on Anchorage's municipal code. In a memo to the assembly, its sponsor, assembly member Betty Glick, of Kenai, said that while it might not always be possible to accurately identify all costs, an estimate was preferable to no information at all.

The measure included a waiver clause allowing the assembly to bypass the necessity for an impact summary and further provided that an ordinance would not be invalidated by the lack of economic summary document. It also had a sunset date of June 30, 2006.

Bagley warned that the fiscal note process could become a political tool.

"It is possible that future administrations could give high fiscal notes on ordinances that they don't support and low fiscal notes on ordinances that they do support," he said. "Even if administrations don't do that, they will still be accused of doing so. At the state level, departments are accused of this on a regular basis."

The mayor said that ideally, fiscal notes should be written by an independent third party "to help lend credibility" to any such attempted analysis.

He said he would support reporting estimates of hours and personnel changes implementation of a proposed ordinance might require, but said the level of accuracy and detail required by the ordinance would be very time-consuming to produce and might not be accurate "despite the best efforts to make it so."

He urged the assembly to rethink enactment of the ordinance.

The assembly did not move Tuesday to override the veto, which requires agreement by two-thirds of the assembly (6 votes), but has through the end of the April 5 meeting to make that move.

Glick said Thursday that she anticipated a motion to override at the next meeting. Two members who originally voted in support of the ordinance were not present at Tuesday's meeting (Grace Merkes, of Sterling, and Milli Martin, of Diamond Ridge), though Martin did participate by teleconference.

Glick acknowledged that some things pointed out by Bagley could be true.

Any administration, she said, "could shade it (estimated effects) one way or the other depending on if they support an ordinance or not."

It is not uncommon for sponsors of bills under consideration by the Legislature to attach "zero" fiscal notes, Glick said.

"You and I know there are dollars attached to those bills," she added.

Even recognizing such a possibility at the borough level, Glick said she hoped borough administrations would "be above those kinds of shenanigans."



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