Like many Borough meetings around budget time, the May 17 meeting ran late. But this time it wasn’t because of the budget. Kenai Peninsula Borough Mayor Charlie Pierce and the Assembly body have already held several marathon work sessions to hash out details of the yearly budget. Ordinance 2022-19, also known as the FY 2023 budget, had its first reading, with no public commentary. The second and final reading will be at the next assembly meeting on June 7. Once passed it will go into effect at the start of the fiscal year beginning on July 1, 2022. If the budget passes as currently amended, a reduction of two-tenths of a mill to the general fund mill rate will also go into effect.
During the meeting, several motions passed through the consent agenda. Notably, Ord. 2021-19-49, regarding the Collection of Remote Sales Tax, Ord. 2021-19-51, a project for soil investigations and land planning in Cooper Landing and an Emergency Ordinance 2022-035, which extended the disaster designation of the Lowell Point landslide.
Resolution 2022-034 also passed through the consent agenda. It urges the State of Alaska and the North Pacific Fishery Management Council to adopt aggressive measures to reduce commercial fishing bycatch in Alaska halibut and salmon fisheries.
There were several contentious items on the regular agenda including Ord. 2022-11. It would authorize the emergency harvest of spruce trees affected by Spruce Bark Beetles and establish a framework for Forestry for a spruce management program. Opponents of the ordinance wanted clearer and more comprehensive language that would protect against potentially negative effects of the program, such as effects to salmon habitat.
Cooper Landing resident, Theo Lexmond, said there could be two unintended consequences. The first would be for land owners. The logging roads would create more traffic, pollution and potential crime even after the project is complete.
The second consequence, says Lexmond “is the potentially dramatic impact that the extraordinary reach of the project compressed within a timeframe may have on the creeks and wetlands of the Kenai River watershed.”
He continued. “With the borough planning to log 21,000 acres over the next five years, and the Chugach National Forest logging three thousand more, the potential for large-scale destructive impact to the watershed seems unacceptably high.”
Heather Pearson, also from Cooper Landing, was concerned about sedimentation in spawning salmon habitat. She said sedimentation in riparian areas has a devastating impact on salmon and forestry roads are a major contributor.
But there's also the threat of a fire if the beetle kill spruce is not harvested. That threat is twofold: the unharvested wood offers more fuel, and fallen or dead trees can impede access of firefighters during a forest fire.
“Whenever I go out, I look around and it looks like a tinderbox,” said Assemblymember Bill Elam. “Is there anything we can do to at least expedite the high, extreme danger areas? I really don’t want to see houses, families, and people having problems specific to a fire.”
Kenai Peninsula Borough Land Management Agent Dakota Truitt acknowledged the intricacies of the project.
“This is a large issue. It's complex and it's sensitive,” said Truitt. “We are looking at incorporating values from each community, because these are properties that are adjacent to 1800 private landowners. There's going to be a huge impact.”
After several amendments to the original ordinance and almost an hour and a half of debate, Ordinance 2022-11 passed unanimously.
Another polarizing topic was Ordinance. 2022–08, an ordinance that could give Independent Power Producers up to a 50% tax exemption for 15 years. While the ordinance is written broadly for IPPs interested in working within the Borough, this ordinance could most immediately affect Renewable IPP. Renewable IPP is an independent power producer that is interested in building a 160 acre solar farm on the Kenai Peninsula.
Both Assemblymember Richard Derkervokian and Mayor Pierce questioned why the Borough should subsidize the for-profit company.
"This ordinance was written with their [Renewable IPP’s] help, it is what they need to make this project go, according to them,” said Derkervokian. “When I pencil out the math, this project is going to make 2.6 million dollars per year. And they are asking the taxpayers to subsidize them. I am not opposed to incentivizing new business, but I am opposed to subsidizing a business for 15 years. If it can’t stand on its own after 5 years, then it shouldn’t be a business.”
Assemblymember Mike Tupper reminded the Assembly that comparing IPP’s to a regular business is “a little unfair.”
“It's a highly regulated market, that is basically socialist at this moment,” said Tupper. “I mean, we have HEA— they’re a collective. This is going to be somebody that is going to come into that market. There's a lot of capital investment that they are going to take a risk on. So I see it as a fundamentally different thing.”
The ordinance passed with overwhelming support, favoring the tax exemption. The single ‘no’ vote was cast by Assembly member Derkevorkian.
The next regular meeting of the Borough Assembly will be on June 7. It will be broadcast live at 6 PM. You can listen here at KBBI AM 890 or stream it online at KBBI.org
