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Rural economies get scrutiny

Commission seeks to root out causes of communities' instabilities

Posted: Tuesday, September 06, 2005

A nine-member advisory commission that met for the first time Thursday in Anchorage will endeavor to understand the root causes of the economic instability that plagues some rural Alaska communities.

Senate Concurrent Resolution 14 passed during the last legislative session created the Advisory Commission on Local Government, which will be chaired by Senate Majority Leader Gary Stevens, R-Kodiak, whose district includes portions of the Kenai Peninsula.

The commission will work over the next four months to develop recommendations for legislative options that would help struggling communities develop more sustainable economies.

"The past few years have seen a number of local communities struggle to provide even basic services," Stevens noted in an Aug. 29 press release.

None of the small communities in fiscal trouble lies within the Kenai Peninsula Borough, but that doesn't mean the costs associated with those Bush villages hasn't or won't impact finances here, warned Stevens in an interview Aug. 30.

"There are many very small communities that have had real economic problems. It does affect us indirectly," he said.

Unlike the Kenai Peninsula Borough, which helps fund many state-supported services through property and sales taxes, villages in the unorganized areas of the state tap state funds to cover the costs of schools and other services, thus reducing the total pool of state funding.

"There are some inequities there," Stevens said. "Those of us who pay property taxes are indirectly supporting those who do not."

With the demise of state revenue sharing programs, some rural villages are on the verge of going out of business as local government organizations, and because they aren't part of organized boroughs, state government could face difficulties trying to focus financial help, such as grant programs, which often require some local government to exist.

Organizing the huge unincorporated parts of the state into boroughs has been a constant goal of state government. Many residents there are reluctant to form boroughs, however, because it could involve paying property and sales taxes.

Commission vice-chair, Rep. Bill Thomas, R-Haines, expressed confidence that the commission, aided by stakeholders, would craft "worthy ideas" for solving economic problems in the unorganized areas of the state that it could present to the Legislature and Gov. Frank Murkowski's administration.

Included on the panel will be state lawmakers Sen. Tom Wagoner, R-Kenai, as well as Sen. Bert Stedman, R-Sitka, Rep. John Coghill, R-North Pole, and Rep. Woodie Salmon, D-Beaver.

Also on the commission are public members Scott Brandt-Erichsen, director of the Community and Economic Development for the city of Valdez, Lisa Von Bargen, city manager of Galena, and Marvin Yoder, borough attorney of the Ketchikan-Gateway Borough.

Among its duties specifically outlined in SCR 14 are:

n Studying the specific reasons for the hardships that communities in Alaska have experienced and developing proposals to continue the evolution of local government;

n Defining the role of state government in the financing of local public services;

n Recommending specific means by which local governments, when desired, can move toward borough formation;

n Reviewing findings of previous local government studies and incorporating useful information in its report.

Past studies to be reviewed include a lengthy examination of rural community problems done in 1979 by the Local Government Symposium, and another done in 1992

That report is due by Jan. 15. The commission is to terminate on Feb. 1.



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