Assembly readies park bond

MAT-SU -- It's likely that nearly $6 million in bonds for parks and recreation projects around the borough will appear on the ballot this October, but exactly which projects voters will be asked to vote on remains up in the air.

The Mat-Su Borough Assembly members met Tuesday to discuss which projects they'd like to see on the bond package. They agreed to include about $5.4 million in projects -- less than the $6.55 million originally proposed to be included in the package.

The bigger concern, however, pertained not to the money included in the package, but to requests for funding from the cities of Palmer and Wasilla for projects within the cities. As part of the package of requests forwarded to the assembly from the borough's Parks, Recreation and Trails Advisory Board, about $2.6 million was included in projects requested by the two cities for projects such as a Palmer ice arena, a Wasilla sports facility and city trails and trailheads.

Borough officials requested a legal opinion on whether the borough could use general obligation (GO) bond proceeds to finance city projects. According to one of two attorneys who weighed in on the matter, the borough may issue GO bonds for capital projects within a city but, in those capital projects, the borough should retain an interest in the property proportionate to the amount of the financing. Palmer requested $1.5 million in funding for its estimated-$3 million ice arena, which would mean the borough would become a half-owner of the facility. However, that interest could be transferred to the city under a management agreement, making the borough a silent partner.

City of Palmer officials indicated they'd like to keep the $1.5 million in funds for the ice arena in the bond package, with the understanding that the borough could manage or have a management agreement with the city to operate its share of the overall facility cost. Palmer City Manager Tom Healy said the council has not yet voted on or entered into any such arrangement with the borough.

"There hasn't been any official action authorizing the agreement," Healy said, "but the city council has been in favor of looking to the borough for funds [to construct an ice arena]. If it's approved by the voters, then we'll get into the details."

At the meeting, Wasilla Mayor Dianne Keller was less willing to enter into such an arrangement, partially because of mixed interpretations of attorney opinions. Because the borough's primary bond counsel, Tom Klinkner of Birch, Hornton, Bittner and Cherot also serves as Wasilla's contractual attorney, Klinkner was asked by the borough only to review the bonding situation as it pertained to the city of Palmer.

Another attorney, Cynthia Cartledge of Wohlforth, Vassar, Johnson and Brecht, was asked to review the case as it pertained to Wasilla's request for $500,000 in funding for its sports complex and another $400,000 in city trail and trailhead improvements. In her initial letter to the borough, she cited Alaska case law showing that, because the land on which the capital projects are located is city-owned, the projects may not qualify for borough financing through general obligation bonds because the borough would not actually own its investment.

At the meeting Tuesday, Cartledge clarified that one way to facilitate the financing could be for the borough to buy the city land for the length of the bond, thereby actually having ownership in the investment.

But Keller told assembly members that an arrangement in which the borough would share control of the project wasn't what the council wanted. She indicated she'd like to see the borough get a third attorney's opinion on options for the two bodies to work within the GO bond financing structure. Keller added she'd like to see a considerable amount of discussion between the city and the borough before any decisions were made. But, as some assembly members pointed out, time is running out. The parks bond proposal is set to be introduced at the assembly's June 24 meeting, with a public hearing to take place at its July 15 meeting. Ballot propositions must be adopted by the assembly by its Aug. 15 meeting in order to be placed on the ballot.

"We have a lot of things to work out and I'm not sure we can get that done by our deadline," assemblywoman Jody Simpson said.