There are two basic issues relating to the Kenai Peninsula Borough's bid to host Arctic Winter Games 2006.  The first are legal issues, which we will discuss another time.  The second issue is about the money. 

Over time, these games will cost each taxpayer a lot of money!  The Kenai Peninsula’s economy is cooling off.  With industry cutting back staff and shutting down facilities, there will be fewer taxpayers available to share our tax burden.  Those of us left are facing huge tax liabilities to pay for non-essential niceties such as the Arctic Winter Games.

KPB Mayor Dale Bagley has been calling Arctic Winter Games 2006 “economic development”.  He supports spending over $5 million in exchange for $2-3 hundred thousand in ticket and tee shirt sales.  While there will be some “economic impact” for hotel, restaurant, and gift shop owners, these businesses do NOT have to share any of the expense.  Their financial support and/or in kind contributions will be strictly on a voluntary basis.  The ONLY group actually “on the hook” for the $5 million are Kenai Peninsula Borough taxpayers!

Mayor Bagley has signed the Arctic Winter Games agreement and $200,000 has been included in the 2004 borough budget to start the process of bringing these games to the Kenai Peninsula.  By signing this agreement, Mayor Bagley has committed the borough to financially insure the Games, regardless of support or lack of support from other governmental entities or private donors.  All that's left for the assembly to do now is to pass Ordinance 2003-24, which will appropriate the $200,000 and provide final authorization for borough participation in the games.

This ordinance is scheduled for public comment at the regular KPB Assembly meeting in Soldotna on July 8th at 7 pm.  If Ordinance 2003-24 is approved, it will authorize the dispersal of the first $200,000 to the "host society", which will then use our money to promote and operate these games.  The proposed operating budget is over $5 million, plus an unknown amount for capital projects.  Without public comment our assembly will assume, as AWG supporters have proclaimed, that our borough citizens overwhelmingly support borough financing of this event.  People with questions or concerns should contact assembly members and plan to attend the borough meeting on July 8th.

Members of the Kenai Peninsula Borough Arctic Winter Games 2006 organizing committee have proposed capital projects that could cost taxpayers millions to construct for their 5 day event, and would cost additional millions more each year to maintain and operate

Several smaller capital projects are included in the bid agreement.  This list includes an indoor ice rink in Homer, enclosing the Kenai ice rink, and $587,350 to develop a biathlon range in Soldotna.  If the Kenai Ice rink upgrade is temporary, which is a real possibility, it will require additional expense to bring the ice rink back to its current status.

Major capital projects proposed include a multi-million dollar multi-purpose building in Soldotna and a downhill ski resort in either Homer or Cooper Landing. 

In April 2002 Andrew Carmichael with the Soldotna Parks & Recreation Department said, "Most of the event facilities needed already are available in Soldotna. The only sticking point might be the peninsula's lack of downhill skiing facilities".  He said ideas would be needed for where to hold the skiing events. He mentioned Cooper Landing and Homer as areas where a venue possibly could be built.

In May 2002, Carmichael told the chamber crowd, "More athletic facilities could enhance the possibility of getting the games. Specifically, lack of ice space, a downhill ski slope and a multipurpose area suitable for games such as indoor soccer could be weak points of the application, but the peninsula has areas and resources that could develop such facilities between now and 2006.” 

The organizing committee mentioned these needed construction projects in December 2002.  An unnamed consultant working with the peninsula's Arctic Winter Games Bid Committee in June 2002 said, "The games would require building some amenities not yet available on the peninsula -- including a downhill ski slope".

Bid committee member Bill Popp in January 2003 said, "We have, in my opinion, a proven history of being able to do these kinds of projects," mentioning the Alaska SeaLife Center, the Soldotna Sports Center and the Challenger Center as examples of the peninsula's ability and willingness to secure public funding for major money losing projects. 

Several questions come to mind: 

1.)  Who will operate these facilities after AWG 2006 end? 

2.)  What is the funding source for these facilities? 

3.)  When will construction of these facilities be announced to the public? 

4.)  Is there enough public demand for these facilities to support them after the games? 

5.)  Where will the downhill ski facility be built? 

6.)  What will be the operations and maintenance expense for the life of these facilities, and who will be responsible for these costs? 

7.)  How much will the mill rate need to be increased to cover these added expenses?

 8.) Do you want your borough to finance these facilities, to underwrite and insure the financial success of the 2006 Arctic Winter Games? 

9.)  Are you willing to pay higher taxes for this project? 

Your silence will be viewed as support and permission to submit a blank check at the expense of borough residents.  If you have concerns, please contact your Borough Assembly Representative and/or attend the July 8^th Assembly meeting.

Three Alaskan communities, each using state grants of $45,000, submitted competing bids to host Arctic Winter Games 2006.  In 2003, the Kenai Peninsula Borough was "awarded" the games.  Other bidders include Juneau and Fairbanks.  The KPB bid $5,044,533, Juneau bid $4,400,000, and Fairbanks bid $2,400,000.

It is interesting to note that Fairbanks proposed an operating budget of $2.4 million to produce the same games!  Why is the KPB bid so much higher?  How much money will Arctic Winter Games 2006 actually cost to produce?  Several possible answers include the following:

1.)  $2.4 million?  Rick Solie Fairbanks bid committee, January 2003.

2.)  Between $3.1 and $3.2 million? Andrew Carmichael March 2002

3.)  Between $3.5 and $4 million? Andrew Carmichael April 2002

4.)  Between $3 and $5 million? Dale Bagley Oct 2002

5.)  Between $4 and $5 million? Assembly President Pete Sprague April 2003

6.)  $5.2 million? Bill Popp January 2003

 The Kenai Peninsula Borough has agreed to spend over $5 million mostly public tax dollars to produce Arctic Winter Games 2006, and expect to generate about $200,000 in revenue from event ticket and tee shirt sales, plus $100,000 in sales tax (based on $5 million being spent). 

There will be some economic impact for local providers of accommodations, restaurants, auto rentals, liquor stores, and gift shops. Estimates of this impact range from $1 million to $15 million depending on whom and when you ask.

1.)  Between $1 and $3 million?  Rick Solie Fairbanks bid committee, January 2003

2.)  Between $1 and $3.6 million? Fairbanks News Miner, March 2003

3.)  $4 million? Andrew Carmichael May 16, 2002

4.)  $6 million? Andrew Carmichael May 6, 2002

5.)  Between $6 and $7 million? Andrew Carmichael April 2002

6.)  Between $6 and $9 million or more? Dale Bagley April 2003

7.)  Between $10 and $15 million? plus required construction costs, organizing committee December 2002

Whitehorse was a previous host of the Arctic Winter Games.  Again, depending on whom you ask, the amount of economic impact varies considerably!

1)  $4 million? From official AWG web site April 2002.

or

2)  $10 million plus? Tom O'Hara, a consultant to the borough's Arctic Winter Games Bid Committee, June 2002.

What is the truth about Arctic Winter Games 2006?  How much will they cost taxpayers to produce?  How much revenue will they produce for the Borough's investment?  What is the economic impact to residents of the KPB who will ultimately shoulder the expense through real property taxes?

Contact Borough Mayor Dale Bagley and Assembly members today, and get answers to YOUR questions!  Plan to attend the KPB Assembly meeting in Soldotna on July 8th at 7 pm.  while Ordinance 2003-24 is being heard.

Please forward this message to every real property taxpayer you know on the Kenai Peninsula, and ask them to do the same.  Everyone is welcome and strongly encouraged to join AK Voters.  It is absolutely FREE to join, and each member automatically receives future issues of the "Spotlight on Juneau ".  Working together we CAN and WILL make a positive difference for Alaska's future!

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