The Kenai Peninsula Borough Assembly postponed action Tuesday on a proposal to seek road powers that could facilitate extension of the Kenai Spur Highway to subdivisions north of Nikiski.
The ordinance introduced by Mayor Dale Bagley would put a proposition on the Oct. 3 ballot asking voters whether the borough should adopt road construction powers within its Road Service Area, which collects property taxes to maintain and plow borough roads.
Congress granted $5.3 million in 1997 to extend the Kenai Spur Highway to borough subdivisions at Gray Cliff and Moose Point, which lie between Nikiski and Point Possession. The borough must provide a $1.3 million match, Rex Young, Kenai area planner for the Alaska Department of Transpor-tation and Public Facilities, said Friday.
However, Young said, the borough contribution could be in gravel and rights of way for the project.
"At this stage, we just want to get through the road construction powers vote. Then we'll start putting together how we're going to do this," Bagley said.
He told the assembly the borough already may have the authority to build the road in order to reach borough-owned lands.
"But if we do it without this ordinance, we could be challenged, because we would be doing it under our planning powers," he said.
He said adopting road construction powers would be cleaner.
Meanwhile, Colette Thompson, borough attorney, said questions already arise throughout the Road Service Area about what constitutes road maintenance vs. construction. Adopting construction powers would make those questions moot.
Bagley said the Spur Highway extension is not the only reason to adopt road construction powers. Other projects may come up.
Assembly member Jack Brown of Nikiski said oil companies have expressed interest in partnerships with the borough to build roads to drilling sites. Obviously, he said, there would have to be some public benefit besides increased tax revenues.
"You'd have tax benefit, economic development, jobs and increased accessibility by the general public," he said. "So, there is more than just extension of the North Road (Spur Highway)."
During public testimony, Hal Becker, who owns land at Moose Point, said the borough has a responsibility to build the Spur Highway extension. If the borough fails to take advantage of the $5.3 million grant, he said, Congress may reappropriate the money for other purposes.
"Reappropriation is always a possibility," Young agreed.
Assembly member Drew Scalzi of Diamond Ridge said building new roads would add maintenance costs for which the borough has not identified funding.
However, Tim O'Brien, another Moose Point landowner, said the people who bought borough land at Moose Point and Gray Cliff have paid property taxes since 1982 and received nothing in return. If the borough extends the road, he said, land values will rise, more of the remaining lots will sell and borough property tax revenues will rise.
"What's coming out of the borough's pocket? I don't know. I can't figure it out," O'Brien said. "The tax base will be there. The people will be there. I guess for some reason the development isn't wanted."
Assembly member Tim Navarre questioned whether, if road construction powers go to the service area, gravel and rights of way could be used for the match. The question is whether the borough's general assets could be used by the service area, which takes in only part of the borough.
"I want this to be right, because I want to extend the road and capture those funds," he said.
Thompson said she could not "definitively say that we could use general assets strictly for a Road Service Area project."
However, some service areas already use what once was general borough land. She also said the borough has the authority to build some roads incidental to exercising other powers. For example, a 1970s court decision upheld the borough's right to build a road to reach a school. So, general assets such as gravel and rights of way may legitimately be available for purposes such as reaching borough lands and schools, she said. Likewise, the borough can, within reason, build access to borough subdivisions.
At that, assembly member Grace Merkes of Sterling moved to postpone a vote on the ordinance until Aug. 15. The motion passed unanimously, with assembly members Chris Moss of Homer and Patrick O'Brien of Seward absent.
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