Weeks in the making, the draft fiscal year 2005 borough budget is expected to become law Monday when the Kenai Peninsula Borough Assembly gathers for a special meeting devoted almost entirely to decisions on the $57.2 million spending plan.
Final action on the budget measure, Ordinance 2004-19, was expected June 1 but was postponed until June 14 when the assembly ran out of time to complete a public hearing and begin their debate. The meeting will focus on the budget and on an accompanying resolution setting borough and service area mill levies for the coming year.
Also on Monday's agenda will be a motion to reconsider Ordinance 2004-13, a measure that aimed to raise the maximum amount of a purchase to which the borough's sales tax could be applied from the first $500 to $1,000. The assembly narrowly killed the measure by a 4-5 vote at the June 1 meeting.
Assembly member Gary Superman of Nikiski called for reconsideration. According to borough finance officials, if the cap were raised, it would generate about $1.9 million annually.
Complicating decision-making are a set of new fiscal realities presented June 1 by borough finance officials. The assessed values on oil-patch properties have been lowered by the state and borough, which will mean significantly less revenue from a major source of tax dollars. Borough Finance Director Scott Holt estimated the shortfall at $540,000.
That comes hard on the heels of a proposal to increase the local share to schools of $786,000, a sum made possible by state increases to education. The borough is not obligated to appropriate the entire amount, but indications are that is where the assembly wants to go.
Changes could be made to the proposed spending plan, but here is a look at what is proposed in the current draft document.
The proposed budget in-cludes $13.5 million for general government operations, and transfers $32.6 million in cash and in-kind services to the Kenai Peninsula Borough School District, representing the borough's local match to state and federal school funds.
The budget also will appropriate $3.8 million toward paying off school debt and another $828,563 on solid waste debt.
Parts of the overall $57.2 million budget go to special revenue funds, including $3.8 million covering solid waste-handling costs, $407 million to the Kenai River Center, $14,800 to the Disaster Relief Fund and $30,200 to the Nikiski Senior Service Area.
Another block of dollars goes to capital project funds, including $1.9 million to school revenue, $40,000 to solid waste and $150,000 to general government.
The budget also makes appropriations to service areas and various other special funds:
Nikiski Fire Service Area, $3,020,603
Bear Creek Fire Service Area, $281,187
Anchor Point Fire and Medical Service Area, $263,801
Central Emergency Services Area, $3,841,032
Kachemak Emergency Service Area, $341,654
Lowell Point Emergency Service Area, $13,596
Central Peninsula Emergency Medical Service Area, $192,536
North Peninsula Recreation Service Area, $1,694,158
KPB Road Service Area, $4,544,485
Engineer's estimate fund, $15,000
Post-secondary education, $502,600
Land trust, $841,839
Kenai River Fund, $459,295
Seward Bear Creek Flood Service Area, $77,823
Disaster relief, $50,000
Nikiski Senior Service Area, $204,724
Solid waste, $5,254,735
Central Peninsula General Hospital, $5,598,197
South Peninsula Hospital, $1,578,840
The budget also makes appropriations to various capital projects funds, including just over $1 million to CPGH and almost $800,000 to South Peninsula Hospital, plus smaller amounts to other service areas.
One is the center of some controversy. It is the $815,000 currently earmarked for the North Peninsula Recreation Service Area to be used to upgrade fire-suppression systems in the now-vacant Nikiski Elementary School if the recreation service area were to take that building over in September.
Anticipation of and opposition to that takeover led a group of Nikiski residents to launch a petition drive to put the idea before voters in October. The borough has not yet decided to add the ballot item, but the group says it has sufficient signatures to force a special election in August if the assembly does not make the move to put the issue on the regular election ballot.
Opponents of the school acquisition believe voters will not approve.
Meanwhile, new fiscal realities including increased building material costs has led the recreation area board to notify the borough they are not now in a position to assume control of the building.
The $815,000 currently in the budget could be removed by the assembly before passing the budget or placed in an escrow account to await further developments.
Resolution 2004-055 will set the mill levies for the borough and service areas. Here are the anticipated fiscal year 2005 mill levy rates:
Kenai Peninsula Borough, 6.8 mills
Nikiski Fire Service Area, 2.3 mills
Bear Creek Fire Service Area, 2.25 mills
Anchor Point Fire Service Area, 2 mills
Central Emergency Services Area, 2.35 mills
Kachemak Emergency Service Area, 1.75 mills
Lowell Point Emergency Service Area, 1.75 mills
Central Peninsula Emergency Service Area, 1 mill
North Peninsula Recreation Service Area, 1 mill
KPB Road Service Area, 1.4 mills
KPB post-secondary education, .1 mill
Seward Bear Creek Flood Service Area, .5 mill
Nikiski Senior Service Area, .15 mill
Central KP Hospital Service Area, 1 mill
South Peninsula Hospital Service Area, 1.75 mills
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