Property taxes set to rise after failed veto override
Property evaluations in Anchorage went out in mid January, and while values stayed roughly the same, something else might lead to a jump in property taxes for Anchorage residents:
The veto shifts school bond debt historically covered by the state onto local governments around Alaska, including roughly $21 million onto Anchorage.
“$21 million,” said Municipal Chief of Staff Jason Bockenstedt. “Making that up is just not possible within the existing budget, unless you want to see a huge reduction in the amount of services that are provided.”
Bockenstedt said the debt is an obligation from voter approval dating as far back as 20 years ago, and in order to maintain the city’s AAA bond rating, they have to honor that obligation. That means the debt will be paid for, like regular school bond debt, with property taxes.
“Based on the numbers we know today, it looks like it’s probably going to be somewhere in the neighborhood of $50-$60 per $100,000 of assessed value,” Bockenstedt said describing how much taxes would go up.
But this isn’t the first time the state has backed off from school bond debt. A moratorium from 2015 stopped the state from taking on new bond debt, and an early version of last year’s operating budget dropped bond debt reimbursement similarly to the governor’s veto. Anchorage School Board President Starr Marsett said all of that has affected how they construct bond packages.
“We’re actually retiring, between this year and next year we're retiring about 112 million in bond debt, and so that is a lot less than what we're asking for this year,” she said. “And next year we're not going to ask for a bond."
But while taxes will go up this year, school bond debt is set to go down considerably next year.
“We’re hoping this one-year hiatus will give a little break,” Marsett said. “Knowing that we have retired substantially more than we’re asking for in the two-year period.”
But school bond debt isn’t the only factor that plays into the city’s property taxes, another is the school district’s actual budget.
“Once the assembly approves that, at some point in April, after first-quarter budget revisions when the mil-rates are set, we’ll know exactly how much property taxes will increase,” Bockenstedt said.
The district's budget proposal is set to go before the school board on Tuesday, and after revisions, before the assembly in March.