Kenai Peninsula Borough assembly members on Tuesday added $35,000 to the draft borough budget for economic development purposes. The draft document, which covers the 12-month period starting July 1, had its first public hearing this week and is up for a final vote next month.
As originally presented to assembly members by Kenai Peninsula Borough Mayor Peter Micciche, the draft budget document included $150,000 for the Kenai Peninsula Economic Development District. That group, headed by Executive Director Tim Dillon, is a non-government entity that aims to bolster responsible and sustainable regional economic development on the peninsula.
Dillon told assembly members during a budget work session earlier this week that the organization expects money from the Kenai Peninsula Borough will account for roughly a quarter of all revenue for the upcoming fiscal year. That’s including an additional $25,000 from the borough, which Dillon requested and assembly members approved this week.
The additional money, Dillon said, will help KPEDD cover matching costs for projects. Being able to cover a local project match, he said, unlocks federal funding that wouldn’t be made available otherwise.
“We take the $175,000 that we’re given from the borough and leverage that for additional funds to help with projects on the Kenai Peninsula,” Dillon said Thursday.
With some grant awards, the total cost of a project will be divided between the group that applied for money and the group distributing the money. That division is referred to as cost share.
How much money the U.S. Economic Development Administration contributes to any one project is often tied to how “economically distressed” a community is. The more distressed the community, the more money the agency will chip in.
Until last year, Dillon said the Kenai Peninsula Borough was considered to be an area in distress, and therefore qualified to have 80% of projects funded by the Economic Development Administration. As the borough’s economy has improved, the cost share has shifted, from 80-20 to 50-50.
Dillon said that if KPEDD cannot come up with their share of the money, they risk losing out on a grant or other financial opportunity altogether.
“Without it, we’re not going to be able to do quite as much as we want,” Dillon told assembly members of the additional $25,000.
In supporting the additional $25,000 for KPEDD, Assembly Vice President Tyson Cox during Tuesday’s assembly meeting cited the matching potential described by Dillon.
“This $25,000 has the potential to become $50,000,” Cox said. “I find that very significant and I think it’s a good use of our funds.”
Assembly members on Tuesday also increased funding for the Alaska Small Business Development Center. That group, which operates a Kenai Peninsula Center, operates under the University of Alaska Anchorage and aims to grow small businesses by offering business advice, low-cost workshops and webinars and other business tools.
As originally proposed, the borough budget included $125,000 for the center. Assembly members unanimously approved adding $10,000 to that amount to be used for training opportunities for staff in Homer and Seward.
A second public hearing and final vote on the borough’s budget for the upcoming fiscal year will be held during the assembly’s June 6 meeting. The draft budget document can be found on the borough’s website at kpb.us.
Reach reporter Ashlyn O’Hara at ashlyn.ohara@peninsulaclarion.com.
