TO:

TO: Gary Superman, Assembly President

Kenai Peninsula Borough Assembly Members

THRU: Dale Bagley, Borough Mayor

THRU: Shane Horan, Director of Assessing

FROM: Clyde Johnson, Special Assessment Coordinator

DATE: May 26, 2005

SUBJECT: Resolution 2005-047, Scooter's Landing USAD - Resolution of Necessity

INTRODUCTION:

A petition has been received for the purpose of forming a Utility Special Assessment District (USAD) in the Scooter's Landing Subdivision area located off of Scout Lake Loop Road in the Sterling area. Originally there were 61 parcels involved in the formation of the proposed district. However, one parcel has been removed as it is sub-standard in size and is considered a non-buildable parcel due to its size and the required setbacks. Therefore, it is unlikely that the parcel will be benefited by gas as required by AS 29.46 and KPB Chapter 5.35. This proposal allocates 100 percent of the costs to the remaining 60 benefited parcels involved in the formation of the District. The first petition signature was dated April 4, 2005. All signatures were received by May 2, 2005, thereby meeting the 30-day circulation requirement of regulation D in Resolution 92-54. A separate signature page for each property owner was issued along with a map of the benefited parcels (exhibit 4 to the resolution); a petition information sheet (exhibit 5 to the resolution); and a commitment letter from ENSTAR (exhibit 6 to the resolution). At the time of the Clerk's certification of the petition signatures of owners for 43 parcels were needed to meet the more than 70 percent approval requirement of KPB 5.35.050; validated signatures for 52 parcels, or 85.2 percent were obtained (exhibit 1 to the resolution, Clerk's certification). With the deletion of the aforementioned parcel the approval percentage increased slightly to 86.6 percent.

PROJECT BACKGROUND:

1) The project cost is estimated at $111,118.80 (ONE HUNDRED ELEVEN THOUSAND ONE HUNDRED EIGHTEEN DOLLARS AND EIGHTY CENTS).

2) The proposed method of allocating the cost is by equal allocation of the assessment among all benefited parcels, i.e., dividing the cost by the number of benefited parcels. With the deletion of parcel #063-880-35 the per parcel cost is estimated at $1,851.98. This is below the amount of the original estimated per parcel cost which was provided to the owners during the petition process. KPB 5.35.090 requires the assembly determine that an equal allocation of costs to each lot is reasonable where the lots are of disparate size (where one or more parcels are more than three times the size of the typical lot). Equal allocation is reasonable because the immediate benefit of being able to connect a service line to the mainline is the same for all parcels.

3) As required by KPB 5.35.070(C) no lien for this project may exceed 21% of the fair market value of the property, after giving effect to the estimated benefit from the improvement. With the deletion of parcel #063-8980-35 there are no (0) lots in this proposed project that exceed the 21% limitation.

4) Pursuant to KPB 5.35.070(D), a special assessment district may not be approved where properties that will bear more than ten percent (10%) of the estimated costs of the improvement are delinquent in payment of borough property taxes from the immediately preceding year. For this project the immediately preceding tax year is 2004. As of today's date, May 26, 2005, three (3) lots within the proposed district, or 5.0 percent, are delinquent in payment of their 2004 property tax.

5) The following list of exhibits to the resolution support and are incorporated by reference in the Resolution of Necessity:

1. The Clerk's certification of the petition, dated May 11, 2005;

2. A profile information sheet for the proposed USAD containing the tax parcel identification, the assessed value before and after the proposed improvement, the name of each parcel owner, the value-to-cost ratio (which may not exceed 21%), maximum assessment and any prepayment needed, whether the property owners have approved the proposed district and tax delinquencies. The profile sheet further specifies the total costs for the proposed USAD, the number of lots and cost of the improvement per lot;

3. The estimated assessment roll including the tax parcel identification number, legal description, estimated assessment per parcel, assessed value, owners name and mailing address;

4. A map of the proposed district showing the benefited parcels, which benefited parcels are improved, and the proposed course of the mainline;

5. The petition form cover sheet which explained to petitioners the nature of the project, its total and per-parcel cost, filing and signature deadlines and requirements, the approved withdrawal prohibition, and the filing fee;

6. A revised letter/statement from Enstar Natural Gas dated April 13, 2005, stating the total linear feet on the project, cost per linear foot, and that they are prepared to construct the proposed improvement during the 2005 season (KPB 5.35.050);

7. Memo from the Finance Director dated the 10th day of May 2005, stating that in-house financing will be used and setting forth the number and frequency of payments.