Juneau budget survey to get underway soon

Juneau-based research firm McDowell Group will likely begin conducting a survey of Capital City residents’ next week.

The Juneau Assembly commissioned the poll to get public input on municipal spending priorities now that the city is facing a projected 7-million dollar shortfall over the next two years. Casey Kelly has more.

An assembly subcommittee met with McDowell Group researchers this week to wordsmith questions for the survey. Assembly Finance Committee Chair Karen Crane plans to present the final version to the full assembly on Monday.

“We’re hoping to have it available for the assembly to take a look at, although it won’t be up for a vote because it will just be informational,” Crane says.

Eric McDowell – founder and principal owner of the McDowell Group – says the survey will aim to give the assembly information it can use during the budget crafting process.

“The objective is to gather public opinion on both preferences for potential budget cuts by department and other programs, and also to gather public opinion on potential sources of local revenue increase,” says McDowell.

The firm’s researchers will do that by asking survey respondents if they favor cuts to certain departments. They’ll also ask residents which departments should maintain services. Questions about revenue increases will cover sales tax, seasonal sales tax, property tax, as well as user fees.

“Not that anyone, including the assembly, is recommending specific cuts at this point, or specific taxes at this point,” McDowell says. “We certainly don’t want that to be a misunderstanding.”

McDowell says at least one open ended question will be included to get some off-the-cuff comments.

“In case there was a particular thing that they were interested in, or favored, or didn’t like, that wasn’t covered in any of the specific questions,” he says.

McDowell Group plans to interview 400 CBJ residents. That should provide a margin of error of plus or minus 5 percent for a community the size of Juneau.

If there aren’t any snags, McDowell expects the first phone calls next week. He says the survey will take about a week, and by the first of February the firm should be able to produce a report for the assembly.

CBJ Finance Director Craig Duncan says he and City Manager Rod Swope are also awaiting the results.

“Ideally, what’ll happen is that we’ll get this information soon enough to make our final decisions in the budget,” Duncan says. “So, I think it’s going to be factored in as we get near the end of February, first part of March in those final budget decisions.”

Duncan says much of this year’s shortfall is due to projected losses in federal funding. In the past, Juneau has received more than 2-million dollars a year from two federal programs. Secure Rural Schools provides Juneau and other communities with a percentage of US Forest Service timber sales; under Payment in Lieu of Taxes, the government pays some property tax to communities for federal lands. As it stands now, Congress will stop funding Secure Rural Schools, while Payment in Lieu of Taxes will be cut by about a third.

“That’s one of the unknowns we’re working with, because it has to do to some degree with Congress, and Congress seems to be having some difficulties in trying to decide anything lately,” says Duncan.

The other big issue is income from investments. Duncan says the rollercoaster on Wall Street has been especially hard on the city’s bottom line.

“The city has in the past relied fairly heavily on our investment returns,” he says. “And like the whole world right now and all of us who have retirement benefits, the interest rates that you’re receiving are significantly lower than they were just a couple years ago. That really is costing the city several million dollars a year in interest income.”

Duncan says sales tax revenue – down in the past three years due to a decline in cruise ship passengers – is expected to rebound in the next two years. Property tax revenue has remained relatively stable.

Typically the City Manager presents the budget proposal to the assembly by mid-March. The assembly then takes the month of April and part of May to review it. The city charter requires the final version to be approved by June 15th.

The McDowell Group survey is costing the city 10-thousand dollars.

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