Walker addresses Anchorage’s local budgeting woes

Gov. Bill Walker’s budget vetoes have carved at $17 million hole in Anchorage’s revenues, with the bulk of that drop hitting the school district.

In a move he called “unprecedented,” Walker spoke by phone through a hoarse voice to the Anchorage Assembly during its Tuesday night meeting. The brief remarks addressed how the gridlock in Juneau is beginning to directly impact the local budgeting process.

“Pushing this off to local government is not at all what we wanted to do,” Walker told assembly members of his veto actions over the legislature’s operating budget.

He went on to add that the dire fiscal situation confronting the state is an “entirely preventable disaster,” but one he’s concerned legislators will not act on.

Anchorage Mayor Ethan Berkowitz. (Photo courtesy Municipality of Anchorage)
Anchorage Mayor Ethan Berkowitz

“As they push stuff on us, we don’t have a lot of tools to deal with them,” said Anchorage Mayor Ethan Berkowitz shortly after the governor’s call. “They basically said, ‘Here, it’s your problem.’”

In a memorandum to the Anchorage Assembly, officials from the administration spelled out the $16.6 million budget gap that will have to be closed if Walker’s vetoes over the budget hold.

The biggest chunk of that money is in a 25 percent drop in how much the state reimburses local governments for bonded debt over construction projects and upgrades to schools. Because those bonds were voter approved, property owners in Anchorage will be responsible for paying the $10.8 million difference, according to an email from ASD spokesperson Heidi Embley.

The remaining $5.25 million in cuts to transportation and the foundation formula is likely to be covered by the school district’s fund balance.

The school board is meeting Aug. 1 to decide on a revised budget.

Another $1.8 million drop is expected as a result of Walker’s limit on the Permanent Fund dividend. Because the Anchorage Police Department garnishes some PFDs, the governor’s $1,000 cap is expected to reduce collections.

The Berkowitz administration is analyzing whether or not additional cuts could potentially impact the city budget.

“He made decisions I wouldn’t have made,” Berkowitz said of Walker. “But he has people’s attention.”

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