Proposed 2021 Anchorage budget attempts to navigate an uncertain year ahead

 Anchorage City Hall
Anchorage City Hall (KTUU)
Published: Oct. 9, 2020 at 9:01 PM AKDT
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ANCHORAGE, Alaska (KTUU) - The Anchorage Assembly got its first chance to question administration officials about the proposed Fiscal Year 2021 General and Capital budgets for the municipality Friday.

The proposed general budget increases in size from the previous year’s by $5,770,119 or 0.8%, for a total of $547,970,672. That compares to a 2.4% increase from 2019 to 2020. Lance Wilbur, director of the Municipality’s Office of Management and Budget, said a major driver behind the smaller increase this year was reduced revenues and uncertainty due to the COVID-19 pandemic.

“We have done our best to make some estimated projections into the future,” Wilber said. “There’s always, and there will be, the necessity to probably adjust some of these things; we will look to the first quarter in April to make those adjustments.”

Wilber added the proposed budget would add an estimated $100 to property taxes for the average $350,000 home.

The main increases to the proposed budget come from increases in salaries and benefits, Wilber cited raising pay due to collective bargaining agreements, and the rising cost of health care. To offset some of the rising costs, though, other salaries and wages will not be increasing.

“With all of the labor adjustments that we have made, the one decision that was made in this proposed budget is that executives and non-represented employees will remain flat for 2021,” Wilber said.

As for proposed new spending items, the newly created Office of Equity and Justice requires funds for the chief equity officer and non-labor spending, and new positions are being added in the Human Resources Department and the Building Safety Service area. The budget also proposes funding for year-round camp abatement.

The budget is also Anchorage’s first to include revenues from the alcohol tax that passed in the April election. It predicts around $9.3 million in revenue, most of which would fund several new positions at the Anchorage Health Department relating to homelessness, domestic violence and other issues dedicated to the language of the tax.

One concern raised during Friday’s work session was actually that the budget may undersell the municipality’s fiscal situation in the coming months. Assembly member Forrest Dunbar pointed to discussions of additional COVID-19 relief bills and a possible vaccine in the next year happening on the national level as things which could help the city’s revenues.

“We’re going to be potentially making some tough decisions about what to cut in the coming weeks and months,” he said. “And I would hate to see a program be cut — when sometimes we cut things and it’s relatively difficult to get them reinstated.”

But Wilber explained they don’t try to predict the actions of Congress or the president when working on the budget, and that any positive changes could also be reflected during the first quarter budget revisions.

Friday’s work session kicked off a month-long review process for the budget, including additional work sessions and public comment. The general and capital budgets will be introduced at the Assembly’s next meeting on Oct. 13, with the first public hearing on Oct. 27. The next work session is from 11-3 p.m. on Oct. 16.

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