Proposition No. 1 - Private Prison [To be voted on by all borough voters]

In July 2000, representatives of Kenai Natives Association (KNA) requested and, on August 15, 2000, received support from the Borough for its proposal to construct and operate a private prison on property KNA owns just north of the City of Kenai. In August 2000, Department of Corrections Commissioner Pugh informed the Borough that the State would not consider a contract arrangement directly with KNA but would consider a government to government relationship wherein the Borough would contract with a private contractor to construct and operate a prison facility. Under this arrangement, funds would pass from the State through the Borough to the contractor.

Following a formal request for proposals (RFP) process, the Borough entered into a contract with Cornell Companies, Inc. for the planning and promotion of a private prison facility to be located within the Kenai Peninsula Borough. The Cornell proposal suggested siting the proposed private prison facility on property owned by KNA located near Wildwood Correctional Center. On April 17, 2001, the Assembly adopted Resolution 2001-026 designating this as the site of the prison facility.

On May 29, 2001, Governor Knowles signed HB 149 designating the Kenai Peninsula Borough as a site for a privately operated prison and authorizing per diem payments of approximately $89 per bed.

Proposition No. 1 seeks voter approval for the Borough to contract with the State of Alaska and one or more private for-profit firms for the operation of a prison or correctional institution containing a maximum of 1,000 beds.

If this proposition is approved by the voters in October, the Borough will be authorized to proceed with the necessary steps to construct and operate a prison facility in the Kenai Peninsula Borough. These steps will include reaching necessary agreements with the State of Alaska and one or more private firms for prison construction and operation, the issuance of revenue bonds to finance the design and construction of the facility, and an agreement for the long term lease or purchase of the land. Per diem funds received from the state would repay the revenue bonds, with no pledge of the full faith and credit of the borough.

If this proposition fails to receive voter approval, the Borough may not proceed with the design and construction of any privately operated prison facility within the Borough for a minimum period of two years from the date the election is certified.

Proposition No. 2 - Reapportionment [To be voted on by all borough voters]

Every ten years, the federal government conducts a census and remits population figures to each state and county in the nation. Both state law and the borough code require the Borough to review these figures and determine whether the current apportionment of the Assembly meets the constitutional mandate of equal representation and "one person - one vote." The Borough is further mandated to place one or more plans of apportionment before the voters at its next regular election following final approval of a state redistricting plan.

On April 17, 2001, the Kenai Peninsula Borough Assembly declared itself to be malapportioned through the adoption of Resolution 2001-040 and authorized the Assembly President to appoint a committee to review the distribution of population within the Borough, to conduct public hearings and solicit public comment with respect to assembly apportionment, and to develop one or more plans for assembly apportionment for consideration by the Borough Assembly. This committee met throughout the months of May and June and conducted public hearings in Seward, Homer, Kenai and Soldotna. On July 10, the Committee submitted four different plans to the Assembly and recommended that the Assembly place at least two of these plans before the voters in October.

On August 7, 2001, the Assembly adopted Ordinance 2001-25 approving two plans for presentation to the voters. Conceptual maps of the two plans are provided on the following pages.

Plan 1 includes 9 single member districts. If adopted by the voters, this plan would realign existing Assembly District boundaries to provide districts of approximately 5,500 residents. If the actual qualified voters of an existing Assembly District change by ten percent or more, the Assembly Member representing that District would be required to stand for reelection in October 2002. Assembly Members representing districts with changes affecting less than 10% of the district's qualified voters and who have not completed their term of office may not be required to stand for reelection in 2002. This is a policy question that the Assembly will decide if this plan is adopted by the voters.

Plan 2 includes 13 single member districts. If adopted by the voters, this plan will create 13 new Assembly Districts. Each of these districts will contain approximately 3,800 residents. The 13 Assembly Seats would all be filled at the October 2002 election. The terms of office would be staggered so that four members would be elected for 1-year terms, four members would be elected for 2-year terms and five members would be elected for 3-year terms.

Following certification of the election, the Borough Assembly will adopt an ordinance putting into place the plan that receives a majority of the votes cast in October. Since it is the intent of the Borough to align Assembly Districts to follow state voter precinct lines as nearly as possible, the district lines on the conceptual maps presented prior to the election may be adjusted to follow the new precinct lines which will be adopted by the State of Alaska in the next few months.

Proposition No. 3 - General Obligation Bonds for Borough Building Expansion [To be voted on by all borough voters]

The Borough Administration Building located on Binkley Street in Soldotna was constructed in 1971 to house Borough and School District administrative staff. The building was designed to meet the needs of the Borough and School District for a 20-year period. In the intervening 30 years, it has far exceeded its design capacity. As a result, many School District and Borough Administration staff are housed offsite in portable structures and in leased space in the Central Peninsula area.

In 1998, a Space Allocation Committee was appointed by the Mayor to review conditions in the Borough Administration Building and to make recommendations to the Assembly to alleviate the overcrowded conditions in the building. This committee's final report recommended the immediate lease or construction of additional office space to cure the overcrowding and to address health and safety issues found to be present in the building. The Assembly adopted the report but failed to act on the recommendations of the Committee.

On December 12, 2000, the Assembly reinstated the Borough Space Allocation Committee. This Committee was asked to present a written plan to the Assembly to remodel the existing building and to acquire or build approximately 20,000 square feet of additional office space to relieve the overcrowding.

The Committee began meeting in January 2001. All of the unoccupied available commercial sites in the Kenai/Soldotna area were reviewed as possible sites for either permanent or temporary relocation of one or more departments of the Administration or the School District. It was determined that none of the available sites would meet the long term needs of the Administration and the School District.

The Committee found that the conditions throughout the Borough Administration Building had worsened over the past three years and continued to create a health and safety risk to borough staff and the public. The Committee further found that these overcrowded conditions represented significant violations of fire and safety codes. It recommended that the Borough and its residents would be best served by maintaining a joint campus to house all Borough and School District Administration staff. In order to meet this goal, the Committee recommended that the Borough prepare a ballot proposition authorizing the sale of $5 Million of general obligation bonds to fund all or a portion of the design and construction of additional office space and to renovate existing office space to bring it into compliance with existing codes and to more efficiently meet the needs of the staff and the public. The administration estimates that the total cost of this project will not exceed $7.5 Million. Any costs over the $5 Million received from the sale of general obligation bonds will be paid from the Borough's General Fund Balance.

If this proposition is approved by the voters, the Borough will proceed with the design and construction of the additional new office space and renovation of the existing building. The design phase will include a full programmatic study to determine the current and future space needs of each department.

Fiscal Note: The issuance of $5 Million of general obligation bonds may result in a tax increase of $10.80 per $100,000 of assessed taxable property value (based on the estimated total 2001 assessed valuation, a 5% rate of interest and a 20-year term). The actual rate of interest and term of the bonds will be determined by market conditions when the bonds are sold.