State staff recommend against Nikiski's bid to become a Connecticut-sized city

Residents from the tiny town of Nikiski who want to become incorporated as Alaska's largest city — geographically speaking — should start by scaling back their ambitions, according to a report by Local Boundary Commission staff.

If the petition from Citizens for Nikiski had proposed boundaries more closely matching the current community along the Kenai Spur Highway, population 4,600, the request might be looked on more favorably, according to the preliminary report.

Instead, the petition, signed by more than 278 qualified voters in the Kenai Peninsula Borough and submitted in October, seeks home-rule city status for Nikiski across a Connecticut-sized chunk of territory covering 5,480 square miles.

The proposed boundaries would stretch west across much of Cook Inlet to the Alaska Range, covering a largely unpopulated area that can't easily be accessed by Nikiski residents, the report noted. The unincorporated town would become bigger than the largest city in Alaska by a factor of about 20, the report noted. The state's biggest "city" is currently St. Paul on St. Paul Island, at 295 square miles and consisting mostly of the surrounding Bering Sea.

The preliminary report, released Wednesday, recommends that the five-member commission deny the petition. It opens a second comment period through June 12 that will give petitioners a chance to fire back.

Stacy Oliva, co-vice chair of Citizens for Nikiski, said the group will meet Thursday night to review the report closely before it makes additional comments.

"This is a preliminary report, it's part of the process," she said. "Rather than taking a discouraged approach, I think we need to be pragmatic and keep walking forward through the process."

Petitioners argue that Nikiski's needs have been "largely ignored" by the Kenai Borough — itself the size of West Virginia at 25,000 square miles — and that they receive an inadequate level of services such as road maintenance.

The report, written by Eileen Raese, a local government specialist for the state, gave several reasons why the commission should deny the petition.

A key one seemed to be the proposal's sheer size. The report said the scale of the proposed city is "imbalanced," in part because 95 percent of the population would live within 1.5 percent of the territory, along the highway.

The petition would allow Nikiski, an industrial base for the oil and gas industry in Cook Inlet, to have taxing authority, including over several offshore platforms. Petitioners estimated that property taxes will raise about $9.5 million a year, allowing it to provide local services, the report says.

In a strike against the petition, the report said petitioners did not propose new services beyond what the borough already provides.

Larry Persily, an adviser to borough Mayor Mike Navarre, said the borough agrees with the report and will read it closely to see if the borough needs to weigh in a second time.

The borough is already providing the services the community wants, including road maintenance and fire response, said Persily.

Nikiski residents have made other unsuccessful attempts over past decades to incorporate and take over services provided by the borough, said Persily.

"It's been talked about before, it will be talked about again," Persily said.

Tyonek, a Native village of 182 on the west side of Cook Inlet and accessible year-round only by plane, would be one of the unincorporated communities swallowed up by the proposed city.

It opposes the petition, Raese, the state official, noted in the report.

The Native tribal government and village corporation said in a comment to the commission that the communities have different schools and different ways of life. Tyonek is more closely connected to Anchorage than Nikiski because of transportation patterns.

The Tyonek groups said the idea of losing control over their land and jurisdiction is "especially disturbing" because Tyonek and Nikiski have vastly different goals and needs, the report noted.

A final staff report and recommendation should be released in July. The commission plans to hold a public hearing in August before deciding on the petition.