Legislature shares oil bounty with cities, boroughs

Posted: Thursday, March 20, 2008

A popular community revenue sharing proposal is bringing Gov. Sarah Palin and legislative leaders together, even while they remain at loggerheads over a supplemental budget that contains vetoed projects from last year.

The revenue sharing proposal stands to bring Juneau $2.1 million, and has strong support from members of the local legislative delegation.

"This is great for the community," said Sen. Kim Elton, D-Juneau.

Juneau appreciates the help from the state, city Manager Rod Swope said. The city hasn't yet decided what to spend the money on if it wins final approval, which now appears likely.

The governor has praised revenue sharing.

"As a former mayor and city council member, it is my belief that services are best provided at the most local level possible," she said.

Particularly important, Swope and Elton said, was that the supplemental budget uses some of this year's oil windfall to pay for three years of revenue for the next three years.

That copies the "forward-funding" model long requested by school districts, allowing them to plan and adopt their budgets on time.

"We're forward-funding revenue sharing by $180 million," said Sen. Lyman Hoffman, D-Bethel, co-chairman of the Senate Finance Committee.

That's something Elton said communities have long said they needed as well. Currently cities have to wait for the end of the legislative session to see how much, or even if, revenue sharing will be approved.

"This allows them to plan ahead, which is something they haven't been able to do before," he said.

Swope said a combination of a commitment on revenue sharing and the state taking responsibility for retirement costs will enable cities to budget with some certainty for a change.

"For the first time since I've been here I'm in a position where I can present to the Finance Committee a budget based on actual money and which doesn't have to be based on what we assume the Legislature may or may not do," he said.

State Rep. Andrea Doll, D-Juneau, said the revenue sharing will be particularly valuable in smaller communities that don't have Juneau's property and sales tax base.

"I know we can always use the money, but when I see the terrible needs of some of these rural communities, that's who really needs it," she said.

The city of Hoonah is counting on the money, said Mayor Dennis Gray Jr., and it has already included a portion of its share in its public safety budget.

"We were betting they were going to come to resolution," he said.

Additional money will probably be used to hold down some utility rates, he said.

"We were looking at raising rates for our water and sewer, but we probably won't have to do that at this point," he said.

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