Fairbanks borough assembly passes FY27 budget with no increase to the mill rate

FAIRBANKS, Alaska (KTUU/KTVF) - The Fairbanks North Star Borough (FNSB) assembly passed its FY27 budget at its May 14 meeting in a 7-2 vote.

According to Tom Hewitt, Special Assistant to FNSB Mayor Grier Hopkins, the budget allocates up to around $600,000 from the borough’s General Fund in order to keep the current tax rate steady, instead of the slight increase to the mill rate proposed by the mayor.

“It was mostly a status quo budget,” Hewitt said. “We tried to hold the number of positions that we have here, the expenses that we have across departments. We tried to keep those as much in line with expenses as possible.”

The special assistant noted that higher property valuations this year could still mean that residents’ taxes go up, even though the mill rate is unchanged.

Calling this year’s budget similar to last year’s, Hewitt said, “We can see other places where people’s costs of living are going up, and we wanted to insulate them from any cost increases as much as we could here at the borough.”

The final budget set this year’s local contribution to education at $65.7 million, about $1.4 million higher than the mayor’s $64.3 million proposal.

“That includes $60 million from our general fund and then $5.7 million from the amount of money that got swept because the school district had basically too much excess money in its fund balances,” Hewitt said.

School Board President Bobby Burgess said the local education funding provided for in the borough’s budget falls in line with what the district requested.

However, he said he was disappointed that $5.7 million of the funding came from money reallocated from the district earlier this year.

“We would have liked to be able to use that on operations,” Burgess said. “We weren’t necessarily expecting to spend all of it this year, but it was going to help us plan for the next several years. It potentially could be used for upcoming expenses if we have budget shortfalls due to inadequate funding like we’ve seen for the past decade or more.”

Burgess said the district will continue to discuss its budget as other factors remain undetermined, including negotiations with staff unions and state funding.

Currently, the school board is scheduled to approve a final budget on June 16, after a work session the day before.

Hewitt said the mayor’s office feels good about the budget as it stands, adding, “We’re in a position where looking kind of out, beyond our borders, to the state and the national financial picture, the cost of kind of utilities, electricity, heat, we kind of need to keep a cap on things as tightly as we can and be more innovative in terms of not spending more money on services, but basically trying to do the best job that we can with the money that we have.”

The total budget, which goes into effect on July 1, encompasses $217 million.

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