The cuts would save the city about $1 million in fiscal year 2014, which starts in July. The list includes two school resource police officers, closing the Mt. Jumbo Gym, and reduced hours at public libraries and the Dimond Park Aquatic Facility. North Douglas bus service also would be cut, and the city’s Streets Department would partially substitute salt for synthetic deicer during the winter.
Kiefer says she tried to limit the impact of the potential cuts on the public, but she would prefer not to make any reductions at all.
“I never like to cut services, and that seems to be what we’ve been doing in little pieces for the last few years,” she says. “And we don’t have any more little pieces to cut.”
The proposed reductions came at the request of the Assembly, which last year approved an operating mill rate increase of 0.23 mills to balance the FY14 budget. Now some Assembly members want to reverse that.
The operating mill rate funds general government services, and has been 9.26 mills since fiscal year 2007. Kiefer says keeping the rate flat for the past seven years has already had an impact on services.
“It’s a delay in service compared to not being able to go to Mt. Jumbo Gym for preschool when you want to,” Kiefer says. “So, what’s happened in the past is a different level of service than what we’re seeing now. Now we’re seeing those hard decisions that actually are taking services away.”
The overall mill rate, which also includes debt service on voter approved bonds, has been 10.55 mills for the past two years and under 11 mills since 2007. CBJ Finance Director Bob Bartholomew says it wasn’t uncommon for the overall rate to be above 12 mills from the mid-1990s through about ten years ago.
“In the recent last two decades it’s kind of at a low point,” Bartholomew says.
The Assembly’s preliminary FY14 budget sets the overall mill rate at 10.89 mills. Bartholomew says that’s an increase of $83 per year on a property valued at $250,000 dollars. Put another way:
“If you take .34 mills – the total increase – and you divide it by the 10.55, that’s a 3.2 percent increase,” says Bartholomew. “So, whatever their existing property tax is, this increase would be about 3.2 percent.”
Kiefer presented the list of potential cuts to the Assembly Finance Committee on Wednesday. The committee did not take any action on them.
So far, the manager says the only public comments she’s received were from people urging the city not to cut $50,000 for youth activity grants and $8,000 for youth scholarships.
“I don’t know what the Assembly is hearing at this point,” Kiefer says. “We have an assembly meeting Monday night and one of the items on that agenda is public comment on the CBJ budget. So, it’s an opportunity for people to provide comment to the Assembly about the budget and about these potential reductions.”
The Assembly is in the middle of several weeks of Finance Committee hearings on the FY14 budget. The city faces a nearly $4 million shortfall even if the property tax increase stays in place. That’s because the federal government has halted its Payment in Lieu of Taxes revenue sharing program, and the city’s income from investments is lower than expected.
The Assembly must adopt FY14 budget revisions by June 15th.