Yukon Flats Regional Government Feasibility Study

1. Yukon Flats Regional Government Feasibility Study

2. Prepared For: The University of Alaska Fairbanks Engineering Science Management and Civil Engineering Departments… and…

3. The Residents of the Communities of the Yukon Flats

4. Presented By: Peter Hewko, Kathy Campbell, Mark Parrott, P.E., Michael Schmetzer, P.E., Michele Desrochers, P.E., UAF Masters Candidates

5. Overview • Introduction • Regional Profile • Standards for Incorporation • Borough Structure Options • Decision Analysis • Steps to Incorporation • Project Management Requirements • Borough Operational Costs • Potential Revenue Sources • Financial Assessment • Conclusions

6. Yukon Flats Boundaries

7. Introduction • Satisfies two primary purposes • Provide the Counsel of Athabascan Tribal Governments (CATG) with a preliminary planning document • Satisfy graduate degree requirements of authors

9. Considerations • Issues Forcing the Discussion • Threat of Annexation • Originates with FNSB and NSB • Oil and Gas Potential • Land Exchange • Fish & Wildlife Service Interests • Assessment of Potential Resources

10. Benefits and Detractors • Impact to Traditional Way of Life • Self-Determination and Control • Decline of State Oil Revenue • Cost of Education • Cost of Local Government • Economic Growth Potential

11. Community • Population Approximately 1300 • Area 53,000 square miles • 9 Communities • Council of Athabascan Tribal Government • Native Corporation • Doyon, Limited • Tanana Chiefs Conference • Proposed Borough Boundaries Identical to Existing Rural Education Attendance Area 13

12. Proposed Yukon Flats Borough

13. Regional ProfileDemographic Summary

14. Regional ProfileArctic Village • Population: 146 • Population increasing • Median Family Income: $19,000

15. Regional ProfileBeaver • Population: 67 • Population Decreasing • Median Family Income: $29,792

16. Regional ProfileBirch Creek • Population: 43 • Population Increasing • Median Family Income: $13,750

17. Regional ProfileChalkyitsik • Population: 84 • Population Increasing • Median Family Income: $16,875

18. Regional ProfileCircle • Population: 99 • Population Decreasing • Median Family Income: $11,250

19. Regional ProfileFort Yukon • Population: 594 • Population Decreasing • Median Family Income: $32,000

20. Regional ProfileRampart • Population: 21 • Population Decreasing • Median Family Income: $23,438

21. Regional ProfileStevens Village • Population: 76 • Population Declining • Median Family Income: $11,563

22. Regional ProfileVenetie • Population: 188 • Population Increasing • Median Family Income: $21,429

24. Standards for Incorporation • Alaska Constitution, Article X • Alaska Statutes • Alaska Administrative Code • Bottom Line - Yukon Flats area appears able to meet all requirements

25. Borough Structure Options • Three Classifications of Boroughs • Home Rule Borough • First-Class Borough • Second-Class Borough

26. Existing Boroughs in Alaska16 organized boroughs • Home Rule (8 of 16) • Sitka, Juneau, Anchorage, Yakutat, Lake and Peninsula, Denali, Northwest Arctic, North Slope. • Over half of Alaska’s population • Four of Five most recent boroughs • 2nd Class (7 of 16) • Bristol Bay, Ketchikan, Gateway, Kodiak, Kenai, Mat-Su, Fairbanks, Aleutians East • 3rd Class – No Longer Allowed by Law (1 of 16) • Haines

27. Decision to Form Borough • Multiple Criteria • Quantitative Impacts • Costs • Revenues • Etc. • Qualitative Impacts • Quality of life • Political • Social • Etc. How do we consider all issues and “calculate” an answer?

28. Decision Analysis • Analytic Hierarchy Process (AHP) • Identify the decision • Identify the criteria applicable to the decision • Prioritize the criteria • Develop pair-wise comparison matrices of each alternative with each criteria • Determine if the consistency level is acceptable • Calculate final ranking

29. Decision Analysis • Decision • What type of government structure is best for Yukon Flats? • Alternatives • Unorganized Borough • Home Rule Borough • 1st Class Borough • 2nd Class Borough • Criteria • Surveys

30. Decision AnalysisSurvey to Prioritize Criteria for AHP • Demographic Information Requested • Name • Location of residence • Title or affiliation • Description of personal interest in topic of borough formation

31. Decision AnalysisSurvey to Prioritize Criteria for AHP • Prioritize the following in order of importance: • Cost of new borough government • Local planning, platting, and land use powers • Avoidance of annexation • Local control and financing of Public Education • Tribal Government • Tax $$$ from TAPS • Tax $$$ from future gas line • Tax $$$ from future Yukon Flats oil and/or gas development

32. Decision AnalysisSurvey to Prioritize Criteria for AHP • Identify other critical issues or criteria associated with borough formation in the Yukon Flats • Do you believe the area would benefit from the creation of a borough government? Why or why not?

33. Decision Analysis • Criteria Considered Ranking • Tribal Government 0.27 • Annexation 0.23 • Cost of Government 0.16 • Tax on TAPS 0.12 • Tax on Future Gas Line 0.06 • Tax on Future Oil & Gas 0.05 • Property Tax 0.04 • Public Education 0.03 • Area-wide Powers 0.02 • Planning, Platting, and Land Use 0.02

34. Decision Analysis • Pair-Wise Comparison

35. Decision Analysis • Calculation of Weights of Pair Wise Comparison

36. Decision AnalysisDevelopment Options

37. Recommended Borough Structure • Home-Rule • Provides Greatest Degree of Self-Determination • Charter Powers Offer Flexibility • Unified Home Rule with absorption of City of Ft. Yukon would probably be most efficient

39. Path to Incorporation • Preliminary Study • Can enough money be raised to support a local government? • Will people support a local borough government? • Written Charter • Local Charter Commission • Retain Legal Expertise • Submit Charter to the Local Boundary Commission

40. Path to Incorporation • Hold Election • Vote on issue of borough formation • How to pay for local government • Elect mayor • Elect assembly members

41. Path to IncorporationProject Management Requirements • Experienced & Committed PM • Qualified Resources • Facilities • Schedule • Funding

44. Borough Operational Costs • Education • Utilities • Government

45. Borough Operational CostsEducation • Yukon Flats REAA 13 • Average Daily Student Count is 307 • Assume Same Needs • Approximate annual cost is $6.5 million • 4 mills, Phased over 4 years

46. Borough Operational CostsUtilities Borough Operational CostsUtilities • High Electricity Costs – Offset by Power Cost Equalization • Telephone, School Internet • Varied Water Sources • Washeteria • Jugs • Community and Private Wells • Rivers, Lakes • Sewer • Primarily Honeybuckets and Lagoons • Outhouses • Septic Tanks • Landfills • Initial Operations and Management Budget of $1.7 million

47. Borough Operational CostsGovernment • Seat of Government • Mayor and Assembly • Legal • Finance • Planning and Public Works • Tax Assessment • Total Initial Cost of $1.3 million

49. Potential RevenueState and Federal Sources • Alaska New Borough Organizational Grant • Federal-Related PILT • Federal PILT for Schools • Power Cost Equalization • Property Tax – Oil & Gas Property • Potential Oil & Gas Revenues • North Slope Natural Gas • Shallow Coal Bed Methane • Grant Land Entitlement • Miscellaneous Federal Grants

50. Potential RevenueLocal Revenue Sources • Property Tax • Real and/or Personal Property • Oil and Gas • Sales Tax Options • General Sales Tax • Aviation Fuel Sales • Alcohol License Fees • Commercial Fisheries • Employment Tax • Annual Head Tax • Mineral/Timber Severance Tax • Industry-Related Payment in Lieu of Taxes • Gaming