Assembly considers reinstating fee for service areas

The service areas around the Kenai Peninsula Borough may have to cough up a little more money to help pay the borough’s bills.

The Kenai Peninsula Borough Assembly is considering a resolution sponsored by Borough Mayor Charlie Pierce that would establish a fee that service areas would pay to the borough for administrative services. The borough currently provides legal services, human resources, tax billing and payroll processing, among other services, to the service areas free of charge.

The fee would be a percentage, with the rate set at 2.5 percent, according to a memo from Finance Director Brandi Harbaugh to the assembly.

ADVERTISEMENT
0 seconds of 0 secondsVolume 0%
Press shift question mark to access a list of keyboard shortcuts
00:00
00:00
00:00
 

It won’t be the first time the service areas have had to pay the fee. The assembly instituted a system to collect administrative fees from the service areas in 2006 at two different rates — one for operating funds and another for capital project funds. The fee for operating budgets was set at 6.25 percent and the capital projects fee was 3.04 percent, according to the memo.

Harbaugh told the assembly during the Finance Committee meeting Tuesday that the rate would be presented in the budget document for fiscal year 2019. The resolution before the assembly would approve the institution of the fee and the rate would be set and the money appropriated during the assembly’s budget process.

“The spend that would be coming from the different service areas is identified within the budget document, and then the flow back into the general fund,” she said.

The assembly later voted to reduce those rates for operating budgets to zero, though the capital projects administrative fee remained in place on a sliding scale from .5 percent to 2 percent, according to the memo.

The borough’s 14 service areas provide a variety of services, from fire and emergency to flood planning to senior services. They range in size from the Seldovia Recreational Service Area, which had a total budget of $61,767 in fiscal year 2018 to the borough-wide Road Service Area, which had a budget of about $8.3 million in fiscal year 2018.

Altogether, their operating budgets totaled $24 million in fiscal year 2018, which requires significant staff time at the borough, according to the memo.

“The intent of the admin fee is to fairly allocate a portion of the financial responsibility of the borough’s general government expenditures to the service areas that use those services,” the memo states. “The admin fee is not meant to cover the cost of services that would be incurred by the general fund regardless of the service areas.”

At the assembly’s Tuesday meeting, Harbaugh said the general reception among the service area boards had been positive, though she hadn’t had the chance to address the South Peninsula Hospital Service Area Board about it.

The chairperson of that board, Keri-Ann Baker, asked the assembly at its meeting to postpone the decision to give the hospital’s board time to ask questions about the proposed fee.

“We’re not necessarily opposed to it, we just don’t know enough right now to have a comment, and we’d also like the opportunity to have enough time to open the (borough’s) annex (in Homer), and the timing of this was that we didn’t have enough time to get to one of our borough representatives and open the annex,” she said.

The assembly agreed to postpone a decision on the resolution to the March 6 meeting. Pierce said he was planning to go to Homer before then and would try to meet with the board to discuss the proposal.

The assembly was generally amenable to the proposed fee, with little discussion during the general meeting or at the Finance Committee meeting that afternoon. Assembly member Kelly Cooper said she planned to propose an amendment to the language so the fee could be “up to 2.5 percent” rather than a set 2.5 percent, though she did not propose it at the meeting that evening.

The proposed administrative fee is part of Pierce’s plan to balance the borough’s budget in fiscal year 2019 without implementing a broad-based tax increase. The other major pieces include withdrawing abut $3.6 million from the borough’s land trust fund, which currently has about $7.5 million in it, and cuts elsewhere in the operating budget.

Reach Elizabeth Earl at elizabeth.earl@peninsulaclarion.com.

More in News

The Alaska Dive Search Rescue and Recovery Team conducts a training mission in Seward, Alaska in 2024. Photo courtesy of the Alaska Dive Search Rescue and Recovery Team
Anchor Point fundraiser to benefit Alaska rescue and recovery group

Alaska Dive Search Rescue and Recovery Team is an all-volunteer nonprofit organization established in 2016.

Kachemak Bay Family Planning Clinic staff (left to right) Angie Holland, RN; Jane Rohr, Sonja Martin Young, CNM; Robin Holmes, MD; and Cherie Bole, CMA provide an array of reproductive and sexual health services. (Photo provided by KBFPC)
Kachemak Bay Family Planning Clinic releases report on STI trends on the Kenai Peninsula

The report pulls from data gathered from 2024 to early 2025.

Pool manager and swim coach Will Hubler leads a treading water exercise at Kenai Central High School in Kenai, Alaska, on Tuesday, June 17, 2025. (Jake Dye/Peninsula Clarion)
Swimmers, parents call on Kenai to support Kenai Central pool

The KPBSD Board of Education last week said communities will need to step up and take over administration of pools within the next year.

Traffic passes by South Spruce Street in Kenai, Alaska, on Tuesday, June 10, 2025. (Jake Dye/Peninsula Clarion)
Kenai drops effort to rename South Spruce Street

The resolution would have changed the name to make it clear which road led to North Kenai Beach

Gov. Mike Dunleavy compares Alaska to Mississippi data on poverty, per-pupil education spending, and the 2024 National Assessment of Education Progress fourth grade reading scores during a press conference on Jan. 31, 2025. Alaska is highlighted in yellow, while Mississippi is in red. (Jasz Garrett / Juneau Empire)
Dunleavy calls special session for August

Lawmakers on Wednesday said they were surprised by the move.

A makeshift coffin decrying the risks of Medicaid funding cuts is seen on Thursday, June 26, in front of the Blazy Mall in Soldotna. The cuts were included in legislation passed by the U.S. Senate early Tuesday morning. (Photo by Jonas Oyoumick/Peninsula Clarion)
Ahead of Senate vote, Soldotna protesters defend Medicaid funding

Cuts to the program were included in legislation passed by the U.S. Senate early Tuesday morning.

Board President Zen Kelly speaks during a meeting of the Kenai Peninsula Borough School District’s Board of Education in Soldotna, Alaska, on Monday, Dec. 2, 2024. (Jake Dye/Peninsula Clarion)
Kenai Peninsula Borough school board to finalize budget

The new budget designed by the committee will be considered at a public hearing during the full board meeting on Monday evening.

The Russian River Sanctuary Area is seen in the area labeled B in this map provided by the Alaska Department of Fish and Game. (courtesy)
Strong sockeye run prompts early open of Russian River Sanctuary

In regulation, the confluence is expected to be open from July 15 to Aug. 20.

The Swan Lake Fire can be seen from above on Monday, Aug. 26 on the Kenai Peninsula, Alaska. (Photo courtesy Alaska Wildland Fire Information)
Burn suspension lifted for Kenai Peninsula and Kodiak

The public is asked to remain vigilant while burning due to minimal available resources.

Most Read