MEMORANDUM

TO: Pete Sprague, Assembly President

Members of the Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Borough Mayor

Jeff Sinz, Finance Director

FROM: Jack Brown, KPB Business Development Manager

DATE: July 24, 2003

SUBJECT: Ordinance No. 2003-19-08: Appropriating $359,000 for the Cook Inlet Salmon Branding Project

The Kenai Peninsula Borough recently received more than $635,000 from salmon disaster funds that the federal government gave to the State of Alaska to distribute to the coastal communities impacted by the loss of revenue due to poor fishing seasons. The Administration requests the support of the Assembly for a $359,000 grant from these funds to the Cook Inlet Salmon Branding project to help fund its efforts for the next three years.

Expansion of the Cook Inlet Salmon Branding Project ("CISB") will provide increased economic development opportunities to the fishing families, processors, and other residents of the Kenai Peninsula Borough. This funding is intended to pay direct costs for expanding the scope of the CISB project to include more fishers and processors and to expand awareness of Kenai Wild branded salmon. Those direct costs include a program manager, hiring and training local inspectors, office space, and the marketing of the Kenai Wild branded salmon.

Another benefit of these additional funds is that they will address problems with existing funding streams. During the CISB developmental phase, CISB has received grant monies to defray the costs of the program to the Kenai Peninsula Borough. However, the erratic nature of grant funding disbursements has made it very difficult to implement important aspects of the program. For example, CISB's entire quality assurance program will receive funding after the fishing season is completed. These delays in funding almost cancelled the program this year and put CISB a year behind in expanding into the Homer area.

With this requested funding it is CISB's intent to increase the number of local quality inspectors, participants and markets for the branded salmon. In addition, the program will become increasingly self-sustaining by hiring a local program manager and becoming less dependent on consultants.

The administration respectfully requests the Assembly's consideration of spending a portion of these disaster funds to help the fishing families and processors revitalize their industry through the CISB program.