MEMORANDUM

TO: Pete Sprague, Assembly President

Members, Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Mayor

THRU: Jeff Sinz, Finance Director

FROM: Holly B. Montague, Assistant Borough Attorney

John Smith, Contract Administrator

DATE: November 27, 2002

SUBJECT: Ordinance 2002-19-27, accepting and appropriating state and federal funds for the proposed Kenai Spur Road Extension

In 1998, the federal government awarded the borough a grant for the Kenai Spur Highway Extension (commonly referred to as the North Road Extension). The grant requires a 20 percent match from the borough, which may include both cash and in-kind contributions. The federal portion of the project is expected to be $5,280,000 (80 percent) and the borough's portion $1,320,000 for a total project cost of $6,600,000. The project is being done in the following phases: (1) preliminary engineering up to and including environmental approval; (2) preparation of plans, specifications; (3) right-of-way acquisition; and (4) project construction. Resolution 2002-142 approved the transfer of responsibility for the design, construction, and maintenance of the North Road Extension to the borough from DOTPF and approved the memorandum of agreement between DOTPF and the Kenai Peninsula Borough for Phase I of the project. The Phase I budget consists of $1,000,000 in federal grant money and $250,000 in local matching money. A $250,000 grant has been awarded by the State toward the borough's match for Phase I of the project. It is necessary to appropriate both the $1,000,000 federal grant and the $250,000 local match to proceed with Phase I of the project.