The Juneau Assembly began reviewing the city’s proposed budget Wednesday.
Even though it plans to adopt a final version by mid-June, members and city staff say they may have to revisit things later on if the state’s budget isn’t finalized before then.
City Manager Rorie Watt describes the budget as mostly status quo from last year, despite adjustments the Assembly made in the intervening months, like adding an additional ambulance crew.
But he warned the Assembly that could change.
“Throughout the year there are small budget changes, but certainly not the macro changes that the state is considering,” Watt said after Wednesday’s meeting. “Frankly, we just have no idea what the state budget might look like.”
The proposed $356 million expenditure budget is a $6 million increase from last year. The city plans to draw on reserves to make up the difference.
Uncertainty with the state budget leaves a number of things, like school funding and capital improvement projects, up in the air.
Gov. Mike Dunleavy’s proposed state budget would eliminate state funding for school bond debt service. The city says that amounts to $7.1 million locally.
The House Finance Committee passed an amendment this week agreeing with that.
The Juneau School District is requesting $26 million from the city, which has traditionally funded K-12 education to the cap that the state allows.
The district’s school board had to make assumptions when passing its budget. For instance, they hope the Legislature won’t take back $30 million in state education funding approved last session.
“Certainly the school district budget is in flux,” Watt said. “There are gems sprinkled throughout the state budget that we would prefer not to find.”
The Assembly is required to adopt a budget by mid-June. If the Legislature is still working on the state budget then, the Assembly may have to come back and revisit it later.
The majority of city revenue comes from property taxes and sales tax. Both have risen slightly the past two years.
According to the city’s Finance Director Bob Bartholomew, property values went up an average of 1% in Juneau during this year’s assessment.
For now, the formula used to calculate property taxes will be reduced by 1% overall.
“Overall there’s probably going to be a slight increase in your property tax bill, but again, with 13,000 properties, they can all change by different amounts,” Bartholomew said.
The Assembly will hold a public hearing on April 24 for the public to comment on the budget.
The city is also anticipating about $6 million in revenue from marine passenger fees this summer. Some of that has already been earmarked to pay for legal fees from the settlement of the cruise industry lawsuit.
Proposals for spending that revenue are now posted on the city website. The public has until May 2 to give feedback to the city manager’s office.
Information on the Assembly’s budget progress can be found online.
