Juneau voters will finalize who’s sitting on the Assembly on Tuesday. Once results are back and new members are sworn in, the new Assembly and city staff will almost immediately start working on next year’s budget, a process that takes months to develop. In the meantime, the Alaska Legislature will convene in another special session Oct. 23. The major topic is new state revenue, including the Governor’s proposal for a 1.5 percent payroll tax. The basic issue is that the state doesn’t have a revenue stream to pay for the many services it provides. In order for the Juneau Assembly to do its job properly, the state needs to implement a sustainable fiscal plan. Through several resolutions, the Juneau Assembly has encouraged the State Legislature adopt such a plan.
Communities across Alaska are high-centered on making budget decisions and problem solving. Locally, that means uncertainty on state funding for schools (Juneau currently gets about $46 million a year), reimbursement for debt on the construction of our schools (about $11 million a year), and the number of state employees that will live in and contribute to Juneau’s economy. There’s also the threat that the state may shift huge costs – including a larger share of the unfunded public pension liability – down to municipalities. These are just highlights. The Alaska Marine Highway System needs fiscal attention as well.
Simultaneously, Juneau has needs, aspirations and visionary thinking. Most people are following the city’s struggles with homelessness, property crime and the escalating numbers of emergency response calls, which is ratcheting up pressure on first responders. Solutions to these problems take resources, and it’s difficult to responsibly plan and fund local services with the looming cloud of uncertainty that results from the lack of a state fiscal plan. Other big local ideas include funding for a new program to provide the Best Starts childcare, potential acquisition of AEL&P and continued development of the waterfront, both downtown and in Auke Bay. Several nonprofit groups are also pursuing funding for big projects, including the new JACC, the Alaska Ocean Center and the senior assisted living facility.
Juneau’s government has saved money and continues to make hard budget decisions in order to have sustainable budgets. In making budget decisions, CBJ has addressed both sides of the budget equation – cutting costs ($3 million in 2014 – 2016) and raising revenues ($3 million 2014 – 2016). It’s the weighing of needs and desires against the ability to pay. For every budget request and issue, the same mindset is applied. For example, in order to increase tax exemptions, the city has to either raise revenue or cut a service.
A responsible government balances citizen needs with available revenue streams. A fiscal plan must look beyond a single budget cycle to plan for and create a sustainable future. The legislature must finish the hard work of creating such a solution so CBJ, and other municipalities, can plan to effectively meet local needs.
(This is written by the City Manager’s office and originally appeared in the October 1, 2017 Juneau Empire in a segment called, “City Corner”)