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1990-10-09 Regular MeetingSERVICE DISTRICT NO. 1 BOARD OF SUPERVISORS MINUTES October 9, 1990 - 7:30 p.m. Assembly Chambers I. CALL TO ORDER AND ROLL CALL The meeting was called to order at 7:35 p.m. by Tony Perez, Chairman. Roll Call was taken. MEMBERS PRESENT Scott Arndt Okie Chandler Jim Fisk Vern Berns Tony Perez Earl Smith Quorum established. II. AUDIENCE COMMENTS None. III. APPROVAL OF MINUTES STAFF PRESENT Ray Camardella Kaye McClain A motion was made by Mr. Fisk, seconded by Mr. Arndt, to approve the minutes of the meeting of August 29, 1990. Motion carried by unanimous vote. IV. PUBLIC HEARING The motion Recommending to the Borough Assembly the adoption of the Agreement for Transfer of Service District No. 1 Water and Sewer Improvements from the Kodiak Island Borough to the City of Kodiak was removed from the table. A Public Hearing was held on the transfer of Service District No. 1 Sewer and Water Improvements to the City of Kodiak. Scott Thompson spoke in favor of the city maintaining the sewer and water for the residents of the Service District. He also spoke on annexation. Ray Camardella gave a point of clarification. He indicated the annexation issue was a topic for the next Public Hearing and that the two issues should not become confused in the discussion. 3 Martha Randolph asked what the advantages would be if the water and sewer was turned over to the city. Mr. Arndt indicated the rates would be lower. Mr. Camardella read from the agreement which said the rates would be the same as they are now. Dick Rohrer said he felt the rates in the city might be raised. He noted the $3.00 difference in the current rate is insignificant and that should not be the basis for the decision. He was not opposed to the city maintaining the system. Mary Jane Rogers asked how grants would be affected by the turn over. Mr. Perez responded he did not know. He indicated if grants were not available future improvements would be built through fund balances and perhaps through the Borough. Mr. Camardella indicated the fund balance would not be turned over to the City but would be invested in the Service District #1 area. Ms. Rogers said she was afraid turn over of the water and sewer would lead to annexation. Cort Neff said he was opposed to the transfer. Norma Holt asked for some background or history of how the transfer agreement came into being. Mr. Arndt indicated due to the conflict in rates between KIB and the city, discussions were held about the transfer, but the Service District Board was not involved in the discussions. The Service District Board asked to hold Public Hearings. He also said if we keep the utilities the rate is likely to increase by $15 to $20 a month, since the city will increase the rate to the Service District by the 33% which has been held in abeyance while the talks on the transfer have been going on. Mr. Fisk said he asked the Assembly to negotiate when the City passed their rate increase. Ms. Randolph provided past history on the water line stating it was a gift to the city after the earthquake. The line was administered by the City until Service District #1 was formed and now the Borough is proposing to turn it over to the City. She said she was opposed to the turn over. Mr. Thompson asked if we are realizing any maintenance cost increases. Mr. Perez indicated growth in the area has provided better funds for operation. He also said the Spruce Cape line is a problem. Mr. Thompson commented that Service District #1 is becoming a political football. He feels an increase in users fees for maintenance would eventually lead to another public works department and he doesn't want to see a duplication. He commented he would be in favor of turning over the lines in return for the promise of bringing annexation to a public vote. Mr. Smith said the original rate increase by the City required an incremental 33% above the City rates to the City plus the service district's operating costs on top. Ms. Holt asked how they came up with 33%. Mr. Arndt said it was based on the old rate ordinance. He indicated a utility bill of the future could be $78.50, not including garbage. Nick Szabo asked the fate of the Capital Replacement fund. Mr. Camardella said the fund balance of $800,000 would be used for Capital projects in the district. Currently three projects are ready to build for $3.5 million. Mr. Szabo said he had no opposition to turning over the utilities since the level of services would not change. Jim Polous said it was a Catch 22 situation. He indicated he wasn't sure how he felt about the turn over, but surely wanted a choice on annexation. Anna Castille said she was in favor of the turn over to the City because of the potential rate increase. She too wanted a vote on the annexation issue. Mr. Thompson asked on the background on giardia filtration system. Mr. Camardella responded that ADEC is enforcing the Clean Water Act. Any surface water source would have to be filtered and have storage tanks for Chlorine contact. Mr. Thompson felt with the expense for the filtration system it would be better to join the city. Mr. Arndt read a letter (attached) from Mike Rasmussen which expressed support for the transfer. Mr. Perez read two letters, Asa & Shirley Beehler and Brent, Lorna and Don Arndt, (attached) which opposed the transfer. Mr. Arndt moved, seconded by Mr. Fisk, that the motion be tabled. The motion carried. V. PUBLIC HEARING The motion Recommending to the Borough Assembly annexation of service District #1 to the City of Kodiak was removed from the table. A public hearing was held on the subject of annexation to the City of Kodiak. John Shank stated that if the Service District was annexed the tax base would drop 80% so present fire services could not be maintained. Scott Thompson said he was basically fed up with the Kodiak Island Borough. He felt the Service District doesn't seem to be heard or represented and City employes treat him as a person. He feels the voters need an option on annexation. He stated the Service District was set up for projects not for maintenance. Mr. Arndt said the Service District was established for water and sewer; road powers were added later. The mill rate is 1.25 for road maintenance and may have to be raised as high as 2 mills next year to keep up. He said he also felt annexation should be left to the voters. Barry Still said the Service District wouldn't have got the grants if they had been in the City. Mr. Arndt stated the City could apply for grants. Mr. Camardella said both the City and Service District # 1 is t eligible for ADEC grants. Grants are based on need and region. Alice Knowles was in favor of annexation and stated she believed more services would be available to Service District residents. Ms. Rogers said home businesses don't want to be annexed because of charging sales tax. She felt that more services would not be gotten easily as the various departments would have to be beefed up. She felt if the area was annexed, the annexation should reach to Monashka Bay. She was not in favor of annexation and felt it should be brought up to a vote. Sid Cozart represented Jackson Trailer Court with 105 units. He said he was in favor of the utility transfer but opposed to annexation. He felt it should be brought to a vote. Mr. Perez and Mr. Arndt agreed the Boundary Commission regards votes as only advisory. Ms. Randolph was opposed to annexation and indicated the voters should decide the issue. Mr. Rohrer said he was still opposed to annexation. He felt more housing was needed and it is more easily developed under DCRA. Tom Everitt, a Realtor, said DCRA funds will allow people to increase their buying power. This financing saves people 1 to 2% and the loans are easier to get. He is against annexation but would like to see it brought to a vote. Jim Poulos said he didn't see any gains in annexation and was opposed. He felt it should be voted upon. Norma Holt said she was against annexation and urged a vote on the issue. Mr. Arndt moved to table the motion on annexation. Seconded by Mr. Fisk, the motion carried. VI. OLD BUSINESS None. VII. NEW BUSINESS A letter of resignation was read from Jim Berg. Mr. Arndt moved that the resignation be accepted with appreciation for Mr. Berg's services to the Service District. Seconded by Mr. Smith, the motion carried unanimously. VII. AUDIENCE COMMENTS Alice Knowles asked why the votes were tabled. Mr. Perez read a letter from Herman Buekers and indicated the Board had not had enough time to read the information prior to the meeting. Ms. Knowles asked why it was not read earlier. Mrs. Mahle asked what the date of the % letter was. Mr. Perez said 10/2/90. She then asked why it was not sent to the Board. Otto Mahle said there were many negative implications in the evenings procedures and that the Board needed to make their decisions based on facts. He indicated a lot of federal regulations will force costs up regardless of who is running the sewer and water. Ms. Randolph requested feed back on the board's motion. Dan Millard indicated the cooperation between the City Public Works Department and the Engineering/Facilities Department of KIB is good. He felt annexation would need to involve the region out to Monashka Bay. VIII.BOARD MEMBER COMMENTS Mr. Smith said Service District # 1 is in transition. People complain about the condition of the roads. The mill rate is raised to accommodate better roads and people complain about the mill rate being too high and they still complain about the roads. He felt he couldn't draw any conclusion from what he heard tonight. Mr. Chandler said the City has absolute power. He was opposed to annexation unless the City would write a new charter. Mr. Arndt and Mr. Berns had no comments. Mr. Fisk indicated the Board had been trying to get a sounding board from the community for the past three months. Attendance at the first two Public Hearings was very small. He felt the annexation area should be out to Pillar Creek, if any of the area was to be annexed. He stated the speakers in this meeting were split 50/50 on the transfer issue and annexation is 90 to 10 against. He said he appreciated the people showing up tonight. Mr. Perez thanked the people for coming and indicated in the future more information should go out to the people of the area. IX. ADJOURNMENT Mr. Perez adjourned the meeting at 9:57 p.m. Approved by: C T ny Perez, Cha rman 9 le Date Submitted by: