Editor’s note: This story has been changed to correct inaccuracies about effects on the Kenai Peninsula Borough’s tax base if Nikiski incorporated with the proposed boundaries and about the borough assembly’s August 1 action on a resolution supporting incorporation by Nikiski representative Wayne Ogle. The assembly approved Ogle’s motion to table the resolution indefinitely.   

Proponents of incorporating Nikiski plan to make their case again before the Local Boundary Commission — the state agency that must approve a new city — in October 2018.

After the Commission’s staff gave an unfavorable review of Citizens for Nikiski Incorporation’s proposal for a 5,480 square-mile city, and the Commission later denied their request to restart the process, the citizen group requested a year-long postponement to change their proposal.

Commission Chair Lynn Chrystal granted the postponement on Oct. 6.

The current initiative formally began with Citizens for Nikiski’s December 2016 petition detailing a proposed city of Nikiski whose borders crossed Cook Inlet and included the village of Tyonek. After Local Boundary Commission staff concluded in a preliminary review that the proposal failed state incorporation requirements, Citizens for Nikiski Incorporation requested a fresh start with a potentially new petition. On Aug. 31 the five governor-appointed Local Boundary Commissioners unanimously voted against the restart, which could have allowed Citizens for Nikiski Incorporation to alter the petition without the consent of the 336 Nikiski residents who signed it.

In their May 2017 preliminary report recommending against the incorporation, the Local Boundary Commission’s staff wrote that the proposal “seeks more than it proposes to offer” in terms of government services and that its proposed borders — following those of the borough’s Nikiski Fire and Emergency Service Area — would create a municipality slightly smaller than the state of Connecticut in which 95 percent of its approximately 5,900 people would live in 1.5 percent of its area.

Tyonek and the Kenai Peninsula Borough both opposed Citizens for Nikiski Incorporation’s plan. Among the borough’s reasons for opposition are taxes. Some of the borough’s biggest tax payers fall within the proposed boundaries. In an August 1 Policies and Procedures meeting in which Kenai Peninsula Borough Mayor Mike Navarre opposed a resolution of support for Nikiski’s incorporation, Navarre said that oil and gas and industrial entities within the proposed city boundary, whose facilities would be excluded from the borough-wide Road Service Area, contribute about 32.5 percent of the service area’s budget, requiring a borough mill-rate increase to compensate for. Citizens for Nikiski has contested this number, stating that the lost Road Service Area revenue would be closer to 11.5 percent. After the committee discussion, Nikiski’s assembly representative Wayne Ogle — who had introduced the resolution — tabled it indefinitely. 

Citizens for Nikiski Incorporation’s co-vice-chair Paul Huber wrote in a press release that the group is preparing to discuss concerns.

“During the coming year, these issues will be addressed in order to provide a stronger petition that has a greater reflection of the historical symbiotic relationship that Nikiski has with industry throughout its service areas and a charter that more closely considers the desires and needs of the community of Nikiski now and into the future,” Huber wrote.

After the postponement ends on Oct. 12, 2018, Citizens for Nikiski Incorporation will be able to submit a draft petition to the Local Boundary Commission, whose chair will decide if the changes warrant another signature collection, according to an email from Local Boundary Commission program manager Melissa Taylor. If so, the new petition will need signatures from 15 percent of Nikiski’s 1,908 registered voters — 286 — and a majority of them must be people who also signed the original.

Huber and Citizens for Nikiski Incorporation’s other co-vice-chair, Stacy Oliva, have previously argued that under Alaska statute the Local Boundary Commission staff should have returned the petition to the group before judging it insufficient in the preliminary report — a complaint the Commission hasn’t addressed. A Sept. 22 reply to the preliminary report, signed by Oliva, states that its findings “are clearly written with an extreme bias against incorporation of the Nikiski community.”

Citizens for Nikiski Incorporation hasn’t decided whether to put amending its petition on hold until questions about the preliminary report are answered. Its reply to the Commission states that comments were “being offered as a formality.”

“The Petitioners’ Representatives and supporters are seriously weighing the merits of amendment of the Petition; and do not want to utilize more of the scarce resources available than necessary to defend the Petition from the flawed Preliminary Report,” the response states.

On the other hand, Huber wrote in Incorporate Nikiski’s press release that the question of whether the petition had been unfairly processed is “foundationally important.”

“Without resolution in these critical areas, any future amendment may continue to experience the impasses that our original petition encountered,” he wrote.

Citizens for Nikiski Incorporation continues having weekly meetings, Oliva said, and will plan out its next moves over the coming weeks.

“Obviously the one-year extension gives ample time for community involvement and a chance to get with the Local Boundary Commission and ask these questions, and work step-by-step with them for a successful situation,” Oliva said.

Once the Local Boundary Commission approves its petition, Nikiski would be able to incorporate with a vote of the residents in the proposed city boundaries.

Reach Ben Boettger at ben.boettger@peninsulaclarion.com