MEMORANDUM

Kenai Peninsula Borough

Finance Department

TO: Pete Sprague, Assembly President

Members of the Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Borough Mayor

FROM: Scott Holt, Finance Director

DATE: September 30, 2004

SUBJECT: Ordinance 2004-19-14 appropriating supplemental funding of $17,824 from the Nikiski Senior Service Area fund balance to cover septic system repairs and workers compensation insurance costs in excess of budgeted amount

The Nikiski Senior Service Area has a contract with the Nikiski Senior Citizens, Inc., a nonprofit corporation, to operate the Nikiski Senior Center. The nonprofit has incurred some unexpected expenses and some dramatic increases in anticipated expenses for which it does not have the resources to cover.

The unexpected expenses include the failure of the septic system at the senior center and a 263% increase in worker's compensation insurance. The nonprofit organization has solicited bids, and, on September 27, 2004, awarded a contract to repair the system for $3,800.00. The annual premium for worker's compensation insurance has risen from $5,906 to $14,024.

The Nikiski Senior Service Area has sufficient funds available within its fund balance to assist the nonprofit organization to cover these obligations. On September 1, 2004 the service area board voted to appropriate $17,824 from its fund balance to cover these costs. The administration supports this recommendation.

cc: Memo from Leigh Hagstrom-Sanger, dated September 28, 2004