Understanding Prop 2 and 3

On Oct. 2 there are two Kenai Peninsula Borough propositions on the ballot that could potentially have a significant financial impact on South Peninsula Hospital here in Homer. I think everyone agrees that we all feel very fortunate to have a great hospital with emergency services that operate 24/7 as well as other clinical services so close to home and in such a small rural Alaskan community.

I’m writing this opinion on behalf of the South Kenai Peninsula Service Area Hospital Board because Proposition 2 and 3 are rather technical and can be confusing and it’s my intention to help clarify them in common terms so folks have a better understanding of what they’re voting for in the upcoming election.

Hospital service areas, or property tax boundaries, were established years ago to partially support the financial viability of hospital services on the Kenai Peninsula. There are two service areas, the South Kenai Peninsula Hospital Service area (south service area) and the Central Kenai Peninsula Hospital Service Area (central service area). I’m not going to attempt to define, in detail, the legal boundaries because they get very complicated, but the boundary line that separates the north and south areas is basically from east to west through Clam Gulch Towers. Residents who live in each service area pay a tax or mil; rate on their property to help support our hospitals. Since the original boundaries were drawn there is now a hospital (Central Peninsula Hospital) in Soldotna and the Seldovia Hospital has closed.

For several years the Borough has considered moving the south service area “north” boundary line further south because there is an assumption that most residents from Ninilchik north now use Central Peninsula Hospital. Recently the Borough Assembly approved a measure that, if approved by the voters, would allow just that and move the original “north” boundary line from Clam Gulch Towers to just north of Ninilchik or Barbara Drive (which is the midway point between the two hospitals) and is identified as Proposition 2. Proposition 2 can only be voted upon by our neighbors north of Ninilchik. If Prop 2 passes, South Peninsula Hospital will lose funding in the amount of approximately $115,000 which are no “small potatoes” for our small hospital and associated clinical services.

Given the likelihood for Proposition 2 passing and the loss of revenue to our hospital here in Homer, another measure was adopted by the Borough Assembly that expands the “south” boundary for the south service area which is the purpose of Proposition 3. Proposition 3 expands the south service area boundary on the south side of Kachemak Bay basically from Neptune Bay to the west, but excludes the City of Seldovia proper because Seldovia is a First Class City and a separate agreement would be required for them to be included in the south service area. Properties east of Neptune Bay, like Halibut Cove, are already included in the south service area. Statistics show that since the hospital closed in Seldovia years ago many residents across the bay, that are not currently included in the south service area, use South Peninsula Hospital. Prop 3 can only be voted on by residents in the south service area and those that may be added in. If Prop 3 passes it should offset the loss of revenue from Prop 2, and the south service area would actually see a $2,000 increase and our mill rate would go down slightly from 2.3 to 2.29.

The property taxes collected are administered by the borough and allocated by the South Kenai Peninsula Hospital Service Area Board. These funds are used for things like replacing old medical equipment, facility improvements and many other things necessary for the continued quality of our medical care provided by South Peninsula Hospital and their associated clinics. I hope I have provided a better understanding of what you are voting for on October 2nd. If you have any questions, please feel free to contact any of your representative service area board members; their information is available on the Borough’s website.

Will Runnoe is a board member or the South Kenai Peninsula Hospital Service Area Board.

Will Runnoe

Will Runnoe