The city budget for the next two years has balanced the estimated $7.8 million deficit across that period, and was introduced to the City and Borough of Juneau Assembly’s Finance Committee on Wednesday.
The committee took the budget as a first reading, and members will submit questions to City Manager Kim Kiefer or Finance Director Craig Duncan from now until the next meeting.
Kiefer said department leaders have been working over the past six months to come up with reductions to balance the city budget. The city has already saved about $4.8 million toward the deficit from a soft hiring freeze — which means most positions that have been vacated throughout the past year or so have been left open. Those will remain unfilled for at least the next two years. Kiefer said this was done on the recommendation of the Assembly from the last round of cuts, where it did not want to see people laid off.
“This represents about 20 people,” Kiefer said of the unfilled positions. “Some positions we had kept open from the prior two years. So we are probably looking at (25 more) bodies, people. ... From a strategic standpoint it isn’t the best, but from an employee morale position it’s the best. We will continue to be doing that through this year and next year. We’re so tight on fund balance, every little bit we can continue to save, that helps.”
She said other changes this year included voluntary furloughs from department leaders — including past City Manager Rod Swope and Kiefer — reductions in advertising, office supplies and a lot of other little places.
Kiefer said further budgetary reductions include reducing library hours, reducing weekday operating hours at the pools, and increases in many fees.
Kiefer said everyone has done a lot of work to get the budget down to where it’s at. She said last year they also reduced the general government budget by $4.5 million — so over the course of that year and the upcoming two the city’s reduced it by $10 million.
Assembly Member Ruth Danner pointed out in the last budget book they received, the city had a budget of $307 million. This year’s is $319 million. She asked how that was a decrease.
Duncan explained only 19 percent of the total city budget is actually in the city government section, which includes the general fund, roaded service area and fire service area. Duncan said, for example, the hospital and other enterprise funds are a completely different part of the budget and some of those areas have been growing.
Kiefer explained the rest of the budget-balancing measures were using $1 million of one-time funds — capital improvement funds from projects like the West Douglas/Juneau connection and Switzer Creek — will be used. The remainder will be gained through a mill levy increase. The mill levy rate for the city this fiscal year is 10.55. Kiefer said the Assembly didn’t want the rate any higher than 11, and Duncan said the city charter says they can’t go above 12.
The budget proposes a mill rate increase of .34 mills in fiscal year 13 and .23 mills in FY 14 — which would put the mill rate at 10.99.
Duncan said at the next meeting he will bring back information from the Assessor’s Office as to what that means for property owners.
“The impact to taxpayers is on assessed value,” Duncan said.
The committee adjourned and met as the Assembly acting body in a special session and approved three ordinances for introduction regarding the budget — including FY 13 city and borough operations, school district funding and the mill rate. The hearings for those three ordinances will be scheduled for April 23 at a regular Assembly meeting.
The city must act on the amount it will provide to the school district within 30 days of receiving the district budget, however it doesn’t have to appropriate those funds until May 31. The city must have its entire budget approved by June 15.
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