Memorandum

To: Tim Navarre, Assembly President

Members, Kenai Borough Assembly

Thru: Dale Bagley, Mayor

From: Jeffrey Sinz, Finance Director

Date: March 1, 2001

Subject: Nikiski Senior Service Area Supplemental Appropriation

The operator of the Nikiski Senior Center, Nikiski Senior Citizens, Inc., is incurring higher than budgeted operating cost, in the areas of wages, groceries, and installation of a new stove. It is projected that by year-end, the operator will incur costs totaling $24,000 in excess of the contract amount.

The service area is proposing that $24,000 be appropriated from the service area's operating fund balance as a one time assistance to Nikiski Senior Citizens, Inc.

It should be noted that the service area is spending more money than it is currently taking in. We anticipate that with approval of this appropriation and continued spending at this level, the assembly will need to increase the service area tax rate from the current approved level of .13 mills to .15 mills in FY2002.