The City and Borough of Juneau released a major revenue update Wednesday night at the Assembly Finance Committee.
With its updated budget, current as of February, CBJ projects revenues for fiscal year 2013 to be greater than expected in the adopted budget.
“We are $350,000 ahead,” said CBJ Finance Director Bob Bartholomew. “But it is just a point in time.”
Though the current budget is expected to run a surplus, fiscal year 2014 could see revenues drop $3.65 million below the city’s approved budget. Some of this shortfall is the result of budget growth from FY13 to FY14.
Bartholomew presented the city’s updated revenues to the Finance Committee.
While some local revenues are proving to be lackluster for 2013, this drop in expected revenue is more than made up by unexpected inflow of federal school funds and local sales and alcohol tax revenue.
The city’s property tax projection was high by about $350,000. On a $44 million revenue estimate “that is a pretty good estimate,” Bartholomew said.
However, the Finance Department had a harder time estimating the city’s investment income for FY13.
“To be $900,000 off,” Bartholomew said, “is a large hole.”
City finance staff were thrown by the nation’s continuing low interest rates.
“The expected rebound in interest rates that the budget was based on has not happened,” Bartholomew said.
Local sales and alcohol taxes are projected to jump from the adopted budget expectation of $43.15 million to an updated $44 million — an increase of more than $840,000.
Federal revenues were also discussed, specifically $775,000 in Secure Rural Schools and Roads funds, and updated budgets for 2013. With federal budget-cutting sequestration looming this funding could be “low hanging fruit in Washington, D.C.,” Mayor Merrill Sanford said.
Bartholomew recommended the Assembly save this money and about $1 million in revenue from the extended 1 percent sales tax to balance the FY14 budget.
Even with fluctuating revenue, Bartholomew said, the city is expected to come out ahead in the current budget.
“We think for FY13 the budget was approved with a $400,000 draw,” Bartholomew said. “We are still on track for that.”
• Contact reporter Russell Stigall at 523-2276 or at firstname.lastname@example.org.