Cities continue to seek funding help from state

Group wants more action on revenue sharing bills

Posted: Tuesday, April 17, 2007

The Alaska Municipal League fears that much-needed revenue sharing with the state's communities is stalled in the state Legislature, but some think it may start moving soon.

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Gov. Sarah Palin had requested $48 million in her budget, money that could be used for everything from keeping essential city services going in Hoonah to providing property tax relief in Anchorage.

In both the House of Representatives and the Senate, the money has been removed from the budget, although separate revenue sharing bills still await action.

"I think there will be some municipal revenue sharing in some form," said Mike Chenault, R-Nikiski, co-chairman of the House Finance Committee.

What may start revenue sharing moving is the Senate Finance Committee discussion of fixes to the state's Public Employee Retirement System and Teachers Retirement System.

Municipal revenue sharing and PERS/TRS help are the top two priorities among many city leaders. Some legislators say two are linked, with retirement taking precedence and help for cities and boroughs coming after that is dealt with.

"Most of the discussion has been in regard to getting the PERS/TRS issue resolved first," said John Bitney, Palin's legislative liaison.

Sen. Bert Stedman, R-Sitka, said revenue sharing couldn't be decided until the cost of PERS/TRS was dealt with.

"We're going to go to work some more on the retirement systems," he said.

"When we get that wrapped up in a couple of weeks we'll look if there's a need for very small communities," Stedman said.

The city of Anchorage is hoping to use revenue sharing money to offer property tax relief, while tiny Seldovia at the end of the Kenai Peninsula just wants to provide basic services, said Mayor Dick Wyland, in Juneau to meet with legislators.

"We're one of the smallest first class cities in the state. We provide water, sewer, snow off streets, police, fire, EMS. We have a clinic in the city building and we pay the cost for a small boat harbor," he said.

In recent years the town has cut to the bone, he said, including one of two policemen.

It has a paid harbormaster - full-time in the summer - and a few other employees, including enough to meet legal requirements for a water system, said Wyland.

"I don't think they understand the needs in the small cities," he said.

Bitney said the governor wants to make sure small communities get help too.

"We have to look at making sure that they are not left out," he said. "If they are not a member of PERS they need to get a contribution."

The concern among many legislators, and at the Alaska Municipal League, said spokesman Jeremy Woodrow, was that small communities that don't benefit from PERS might get left out.

"Municipal revenue sharing and PERS/TRS are really two separate issue," he said.

The problem with retirement is paying for past liability, while revenue sharing deals with ongoing operating costs, he said.

"PERS/TRS assistance, you can't use that to directly lower a mill rate," he said.

Seldovia's Wyland said that for cities the size of his, revenue sharing was the priority.

"It's extremely more important than PERS is," he said.

Whether the small cities, including some that can barely operate, can persuade the Legislature to go give them help will be decided in the final 30 days of the legislative session.

"I think I got a very polite reception, they were very courteous to me, and I appreciate that," Wyland said.

"With 125-150 on the voting lists (in Seldovia), I don't carry a very big club with them," he said.

• Pat Forgey can be reached at

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