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HomeMy WebLinkAboutRes2012-082 Sponsored by: Hunt t hrim CITY OF SEWARD, ALASKA RESOLUTION 2012 -082 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ADOPTING AN ALTERNATIVE ALLOCATION METHOD FOR THE FY2013 SHARED FISHERIES BUSINESS TAX PROGRAM, AND CERTIFYING THAT THIS ALLOCATION METHOD FAIRLY REPRESENTS THE DISTRIBUTION OF SIGNIFICANT EFFECTS OF FISHERIES BUSINESS ACTIVITY IN THE COOK INLET FISHERIES MANAGEMENT AREA WHEREAS, the State of Alaska requires that for a municipality to participate in the FY2013 Shared Fisheries Business Tax Program ( "Program "), the municipality must demonstrate to the Department of Commerce, Community and Economic Development that the municipality experienced significant effects during calendar year 2011 from fisheries business activities; and WHEREAS, the Program provides for the allocation of available program funding to eligible municipalities located within fisheries management areas specified by the Department of Commerce, Community, and Economic Development; and WHEREAS, the Program provides for the use, at the discretion of the Department of Commerce, Community, and Economic Development, of alternative allocation methods which may be used within fisheries management areas if all eligible municipalities within the area agree to use this method, and the method incorporates some measure of the relative significant effect of fisheries business activity on the respective municipalities in the area; and WHEREAS, the City Council of the City of Seward, Alaska proposes to use an alternative allocation method for allocating the approximately $60,706 in FY2013 funding available within the Cook Inlet Fisheries Management Area, in agreement with all other municipalities in the area participating in the FY2013 Shared Fisheries Business Tax Program. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. By this resolution the Council certifies that the City of Seward did experience significant effects during calendar year 2011 from fisheries business activities that occurred within the Cook Inlet fisheries management area, and seeks to apply for funding under the FY2013 Shared Fisheries Business Tax Program. Section 2. All eligible communities in the Cook Inlet fisheries management area will receive fifty percent (50 %) divided equally and fifty percent (50 %) divided on a per capita basis. CITY OF SEWARD, ALASKA RESOLUTION 2012 -082 umil Section 3. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 7th day of November, 2012. THE CITY OF SEWARD, ALASKA David Seaward; yor AYES: Valdatta, Bardarson, Keil, Shafer, Terry, Seaward NOES: None ABSENT: Casagranda ABSTAIN: None 0101 ATTEST: // . f hanna Kinney, CMC � l ity Clerk • ••ypFSE , '•. • G` • O %f °R.. . • 1® • i * �J "''17T . =• I SEAL ! • • • . —.-- 0. - 'ti� s: TF � I . � ...I COUNCIL AGENDA STATEMENT Meeting Date: November 12, 2012 / F stet, Through: James Hunt, City Manager ,� From: Kristin Erchinger, Finance Director q p Agenda Item: 2013 Shared Fisheries Business Tax Program BACKGROUND & JUSTIFICATION: The City of Seward is required to apply to the State of Alaska Department of Community and Economic Development (DCED) each year, to qualify for funding under the State's Shared Fisheries Business Tax Program. The purpose of the program is to provide for a sharing of state fish tax collected outside municipal boundaries, with municipalities that have been affected by fishing industry activities. This is the 20th year of this program, and municipalities across the state will share tax revenues from 2011 fisheries activity as reported by fish processors on their fish tax returns. The law that created this program requires that funding be allocated first to fisheries management areas across the state based on the level of fish processed in each area, compared to the total fish processed for the whole state. Then, funding is allocated among the municipalities located within each fisheries management area, based on the relative level of impacts experienced by each municipality. Seward is located in the Cook Inlet Fisheries Management Area, which includes Anchorage, Homer, Kenai, Kenai Peninsula Borough, Kachemak, Seldovia, Soldotna, and Seward. The State's FY2013 program allocation to be shared within this area is approximately $60,706, down $22,831 from the prior year. In fisheries management areas where the program allocation is greater than $4,000 multiplied by the number of municipalities in the area, program regulations provide for a "long- form" application. In the Cook Inlet Fisheries Management Area, the threshold value is $32,000 (8 municipalities x $4,000). The final deadline for submitting application for the FY2013 Shared Fisheries Business Tax Program is December 15, 2012. The long -form application provides for a "standard" and an "alternative" method of funding allocation. The City of Seward will file under the alternative method. Standard Method: Under this method, each municipality must determine and document the cost of fisheries business impacts experienced by the community in 2011. Once the impacts have been established for each of the municipalities, the DCED will calculate the allocation for each municipality using the following formula: One -half of the available funding is divided among participating municipalities on the basis of the relative dollar amount of impact in each community. The other half of the available funding is divided among municipalities based on the relative dollar amount of impact per capita in each community. COUNCIL AGENDA STATEMENT FY2013 Shared Fisheries Business Tax Program Page Two Alternative Method: Alternative allocation methods may be proposed by the municipalities within the area. DCED will consider approving the use of a proposed alternative method only if all the municipalities in the area agree to use the method, and if the method includes some measure of the relative effects of the fishing industry on the respective municipalities in the area. The short-form method allocates the available funds by sharing 50% of the funds equally among the participating municipalities, and allocating the remaining 50% on a per- capita basis. The information required by the long -form application would be difficult and time - consuming to obtain. Therefore, it is proposed that municipalities in our area use the alternative method and that we further agree that the allocation method be the same method used in the short form allocation. Given the small amount of additional funding that the City might gain by utilizing the standard method, compared to the additional time required to complete the application, it is our recommendation that the city of Seward agree to use the alternative method and agree that 50% of the funds will be allocated equally among the participating municipalities, and the remaining 50% allocated on a per- capita basis. This will be the thirteenth consecutive year of using this method. INTENT: The intent of this action is to authorize a contract for the purchase, installation, and training for new general ledger financial accounting modules and software. CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan (document source here): 2. Strategic Plan (document source here): 3. Other (list). X ATTORNEY REVIEW: Yes X No FISCAL NOTE: Using this same allocation method, Seward expects to receive approximately $4,016.89 in shared fisheries business tax proceeds, and $151.67 in landing tax proceeds, in 2013. This is slightly lower than the approximately $6,000 in the previous year. Approved by Finance Department: • _` / RECOMMENDATION: Council approve Resolution 2012 - adopting an alternative method for the FY2013 Shared Fisheries Business Tax Program, and certifying that this allocation method fairly represents the distribution of significant effects of fisheries business activity in the Cook Inlet Fisheries Management Area and authorize the city manager to apply for funds from the Shared Fisheries Business Tax Program.