MEMORANDUM

TO: Pete Sprague, Assembly President

Members, Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Mayor

FROM: Max Best, Planning Director

Roberta Wilfong, Spruce Bark Beetle Project Manager

Scott Holt, Finance Director

DATE: April 22, 2004

SUBJECT: Ordinance 2003-19-49 amending Ordinance 2001-19-35 by authorizing the use of remaining funds for utility right-of-way clearing in the area south of the Kenai River

In 2002, the assembly appropriated $300,000 in interest income earned by the Spruce Bark Beetle Program to fund utility right-of-way clearing in the area north of the Kenai River. This was based on an expectation that the spruce bark beetle would spread north of the Kenai River more rapidly than has occurred. To date, invoices from HEA on this project total $108,467.66, leaving a balance of $191,532.34. The administration recently received a request from Homer Electric Association ("HEA") to change the project location in that grant fund to include areas south of the Kenai River. HEA requests that it be allowed to use the funds to finish clearing the area south of the Kenai River and east of the Sterling Highway with Gaswell Road and Northern Kalifornsky Beach Road being the first priorities. The Spruce Bark Beetle Program concurs with HEA's request and respectfully seeks approval of this ordinance from the borough.