A proposal in the Legislature would provide $50,000 grants to Alaska cities hit by hard by rising costs and reduced state funding.
The bill by Rep. Norm Rokeberg, R-Anchorage, would provide the grants to Alaska's 163 municipalities, regardless of size. Rokeberg said the proposal would cost $8.15 million.
But some lawmakers questioned excluding from the aid package Alaska villages that are not recognized as municipalities.
Many cities have struggled to remain solvent since Gov. Frank Murkowski cut $37 million in municipal aid in 2003. Murkowski and the Legislature helped fill the city funding gap last year by directing about $18 million in one-time federal money to municipalities.
Kevin Ritchie, executive director of the Alaska Municipal League, said if the Legislature does not act to send money to municipalities, it would be the first year since the revenue sharing program was created in 1969 that cities did not receive help paying their bills.
He said many communities "cannot afford to buy municipal insurance and have virtually no assets."
He said as of this year nine cities have ceased to operate, 17 face serious debt and 39 have terminated key local services such as road maintenance, law enforcement, and facility maintenance. Ten cities have dropped municipal insurance and another 33 are on month-to-month payment plans, Ritchie said.
Rep. Woodie Salmon, D-Beaver, represents the largest state House district in the nation, which includes more than 90 cities and villages. He said the bill leaves out 66 villages across the state also in need of aid.
"They shouldn't be left out just because the state doesn't recognize them," Salmon said.
Rokeberg said the funding should be an incentive for those areas to incorporate and establish their own city governments.
"We want to encourage the organization of local governments and I think we achieve that with this bill," Rokeberg said.
The bill was discussed Thursday in the House Community and Regional Affairs Committee. The committee did not take action on the bill.