• Few clouds
  • 36°
    Few clouds
http://sealaska.com
  • Comment

My Turn: Can we sustain all the Borough activities?

Posted: January 28, 2013 - 1:02am

Shortly after the October municipal election, the new Assembly met in retreat. Recently on a local radio program City Manager Kim Kiefer indicated that the Assembly Committee of the Whole met and reviewed the draft goals they established one more time and decided they were good to go.

Late last year Kiefer said the CBJ’s current organization is ‘not sustainable.

Kiefer reports the Assembly also wants to get a better sense of the financial review for their departments aside from what happens during the normal budget process, which is coming up in a few months. Since City staff has yet to fully inform us about this sustainability problem, let alone figure out a way to address it, here are a few facts to consider:

The CBJ budget is about $254 million. With a population of 32,000, that works out to about $8,000 per resident. Is anyone asking how this level of spending compares with other communities of a similar size?

It is estimated that 90 percent of our CBJ budget goes to pay personnel costs. How does this compare with other municipalities?

The CBJ is also burdened with a large unfunded liability for both PERS (Public Employee Retirement System) and TERS (Teachers Employee Retirement System). How does this obligation compare with other similar communities? Do we have a strategy to pay it off?

The CBJ manages over $500,000,000 in assets — buildings, equipment, and tools — all of which must be maintained. More local projects are coming on line (like an additional library) most of which will not be self- supporting. Deferred maintenance is now being financed in part by sales tax revenue rather than a budget item established as these projects come on line.

Do we have a strategy to deal with deferred maintenance or will we just keep borrowing money to maintain our assets?

How does the CBJ inventory of assets, particularly our public facilities, compare with other Alaska cities of a similar size?

State revenue is projected to fall unless oil production is increased. Federal spending in Alaska is also projected to continue to decline. Compared with the rest of the state, Juneau’s population remains relatively flat, meaning no new taxpayers will be added to either our property or sales tax base. And, with the aging of Juneau’s population, more residents will be claiming Juneau’s sales tax exemption for those aged 65 and older.

Do our CBJ Assembly and staff have a strategy to address reductions in revenue streams? The current trajectory suggests we are well on our way to looking like Stockton or Vallejo — the California cities that let things get out of control and ended up in bankruptcy.

To its credit, the Assembly (for two years in a row) has identified the need for a plan. The role of the Assembly is to agree on what is needed and set policy. It’s staff’s job to take action to implement the will of the body. Juneau’s fiscal future depends on that implementation. So what’s the plan? And when can we expect to hear from staff about their strategy?

• Kahklen is a Juneau resident, a Tlingit member of the Raven clan and Dog Salmon tribe, and member of the First Things First Alaska Foundation Board. First Things First Alaska Foundation (FTFAF) is dedicated to preserving the economic viability and future of Alaska through education.

  • Comment

Comments (24)

Add comment
ADVISORY: Users are solely responsible for opinions they post here and for following agreed-upon rules of civility. Posts and comments do not reflect the views of this site. Posts and comments are automatically checked for inappropriate language, but readers might find some comments offensive or inaccurate. If you believe a comment violates our rules, click the "Flag as offensive" link below the comment.
skirkz
6683
Points
skirkz 01/28/13 - 08:03 am
15
3

Same plan as always.

Keep milking and bilking the taxpayers and proposing feel good names for their pet projects to get them voted in. It's not going to change. CBJ will bleed us dry if they can.

Tikitime
3133
Points
Tikitime 01/28/13 - 08:03 am
7
2

Most excellent questions

CBJ?, Assembly?, Juneau Empire? anybody have any answers for this post? JE- just a thought but maybe you could do some investigative reporting on this!

bjfluetsch
2940
Points
bjfluetsch 01/28/13 - 08:09 am
13
4

I think the Mayor said it best

Mayor Sanford I think said it best after the primer on how the housing industry works, that overtime the Assembly does a bunch of little things (regulations) that ends up a colossal disaster in the long run.

concerned
572
Points
concerned 01/28/13 - 08:30 am
9
2

Kudos

A well written piece encouraging a needed debate. Will anyone engage?

alaskabobc
3923
Points
alaskabobc 01/28/13 - 08:34 am
9
8

Ask Randy what to do,

and then, while he is speaking "LISTEN"!

glacierdogs
1330
Points
glacierdogs 01/28/13 - 08:48 am
10
4

Comment

We need to thank Mr. Kahklen and others who bring this severe funding imbalance to our attention even as few pay attention. Juneau has an addiction to government, and city government reflects that. Municipal general obligation debt needs to be part of the concern and the arithmetic. State government is already quietly anticipating cutting the larger municipal governments loose on state reimbursement of city debt sold for school construction. Debt and the past service liability for the defined benefit city retirement plans must be planned and budgeted.

CBJ government needs to look at its dependence upon state revenues and the projected decline in oil production. State government will cut direct payments to municipalities before it will cut its own bureaucracy. Enterprise funds like buses and handicapped transportation need to come up with a plan to become funded by sources other than the city. Capital projects need have inflation-proofed maintenance reserve funds. Rather than asking for more state funding for CBJ capital projects such as highway lighting the city lobbyists need to ask for a quick paydown of liabilities such as the PERS/TRS unfunded liability so there is less of it to foist on to municipal government. Above all, Juneau needs to keep the legislative sessions and the capital here, and that will become difficult when state spending comes to reflect much lower oil production.

It would take more leadership to do so than we have seen in CBJ government up to now but it makes more sense to begin cutting city government now than to wait until state government is also in crisis. State government cutbacks will reduce state employment in Juneau; why wait until then to cut city government employment so that the hard economic landing is all that more severe?

CBJ also has to plan for reduced federal employment. One way or another federal spending on everything but maintaining some level of military strength and health care for old people has to be severely reduced. The borrowing has to end either by economic dislocation or an ordered paydown, but either way the government will be cut. Younger workers may come to understand how they are being required to pay for huge social spending that will not be available when their generation needs those programs. I hope city government tries to get ahead of the curve.

Thanks again to Joe Kahklen.

haineschris
2213
Points
haineschris 01/28/13 - 08:53 am
17
3

Mirrors my thoughts

For a few years I have been on the stop the spending, cut the pork bandwagen. This letter addresses exactly what I have been talking about.

This year my wife and I are paying $124 more per month for the tax increase on our house because of the new bond and the way property taxes were adjusted. (we live in a 60 yr old building that is nothing fancy) I do not feel one bit better living here because of the increase. In fact, it sometimes sends me out the door to work in a grumpy mood.

Juneau is due for a change in the way things are done. Otherwise, I foresee a crash and burn. Wake up, we can live quite well without many of the frills being forced down our throats.

Latitude58
14400
Points
Latitude58 01/28/13 - 09:36 am
9
17

Fair questions

Mr. Kahlkens asks some fair questions, though obviously he's pushing the First Thing First agenda with his letter. Remember them? They were the guys who brought the global warming denier speaker to Juneau a few years ago. Just so you know who we're talking about.

He must have missed the recent Empire article on Juneau, and Southeast's, significant population growth: http://juneauempire.com/local/2013-01-18/southeast-region-has-highest-po... If the region's population continues to grow like this, many of the issues he's citing resolve themselves. And in fact, the more pertinent question might be: How are we going to manage our growing population? We're already struggling with that question with our housing shortage.

Kahlken is cherry picking to an extent. I believe that Keifer's statement a couple years ago about the sustainability of our budget stemmed in part from the decreased tax revenues brought on by the nationwide recession. As the recession eases and cruise traffic increases, tourism sales tax revenues continue to rise.

Juneau is a very, very unique city. We're a state capitol, with its attendant responsibilities and benefits, so that puts us in an elite group in itself. We are in a geographically isolated location, with high transportation, energy, and basic commodities costs. Our population mix is atypical. Our economy is unique. Even the fact that we have a combined City/Borough is different than the typical Lower-48 separated City/County structure.

It would be easy to point at a similarly-sized city in Idaho or Iowa and say; "See, they're much more efficient than we are!" But that would be comparing apples to oranges.

We should always be looking into the future the best we can. We should always be trying to benchmark ourselves. And of course we want to be efficient with our tax dollars. But we shouldn't allow ourselves to be panicked into stampeding over a cliff. And that's what the First Things First group is hoping for.

BTW - where was Mr. Kahlken's letter when the bond and sales tax measures were on the previous municipal ballot that will buy us new libraries and off-road vehicle parks? Where was his letter when Cathy Munoz used her position to pipeline a skating rink into the Valley? He would like to imply that it's the big, bad CBJ and their employees who are to blame for the cost of government here...but he fails to point out that it's been we the voters who have demanded all of these goodies.

So, fair questions...but I sense an agenda here.

islander
1192
Points
islander 01/28/13 - 09:48 am
4
7

legislature and tourist

So how much of the budget is due to the desire to keep the legislature and the tourist industry in Juneau? I doubt you could get an accurate answer to that question.

I also must laugh when the writer fails to identify any sources of funding for the budget. It is as if the author want you to believe everything is based on residents paying the entire amount. How much federal, state, tourist taxes and every other source excluding local property taxes goes into the revenue side of the budget?

Juneau is not going to keep the Capital and the tourism industry and expect the cost of infrastructure provided through the municipality to go away.

Birchwood
380
Points
Birchwood 01/28/13 - 10:30 am
11
3

Go ahead; make my day!

Start this year off right. Begin by denying every new little project and upgrade local folks want. Require that every move that impacts the budget carries a funding source with it or no approval.
Try to get ALL people and organizations that benefit from being in the Capitol City to participate in revenue generation for facilities that benefit ALL residents.
Quit pumping out money for every lay-about bum that gets off the ferries this summer.
You're welcome.

nottacheechako
472
Points
nottacheechako 01/28/13 - 10:32 am
10
8

Lat, step outside

and feel the 5 degree wind in your face to wake you up on global warming....
Joe brought out good points for discussion and you continue to blast the messenger without ever offering up solutions yourself from your Government desk, assuming you have a day job?

Typical for Lat, why don't you get engaged to the process and work to correct problems for a change rather than your boring old drivel day after day after day??

glacierdogs
1330
Points
glacierdogs 01/28/13 - 10:47 am
9
8

Latty

Juneau is a state capital. The Capitol Building is located in Juneau.

I didn't know the FTF people were still around. However, I saw their global warming presentation and I still believe every word that I heard. Now, many more people do not believe in global warming, climate change and the Great Pumpkin. We could use some global warming right now!

Where was the Valley skating rink that you blame on Rep. Munoz built? I haven't seen it and might like to use it. A study instead of a rink was funded by the Legislature at the request of Juneau residents rather than the request of Rep. Munoz. Your facts are upside down.

I have no understanding whatsoever of your analysis. Mr. Kahklen cited economic facts and used dollars as a unit of measure. You cited the difference between having a city name that begins with J compared with states with names beginning with I as somehow important. Mr. Kahklen is talking over your head, and you are talking around him.

You missed the point of the article. How are our economic circumstances modified by Alaska having boroughs instead of counties? How does that meet our indebtedness or cure the persistent decline in state oil production (not to mention how much CBJ government depends upon that production and how many year-round jobs here are paid directly from that oil production)?

swimmergirl
4368
Points
swimmergirl 01/28/13 - 11:40 am
9
1

I'd be happy......

If the city (and state) would simply pay it's bills before buying something new. That's how things work at my house. But we continue to buy new things and add more infrastructure and personnel without having any sort of a plan to pay into the retirement and benefits for those folks who work 20-30 years in good faith with retirement as part of their contract.
You agree to it in 1990? Back it up in 2010. Can't afford it anymore? Stop offering it for future employees. But a deal is a deal.

wolfmagic2012
2658
Points
wolfmagic2012 01/28/13 - 12:21 pm
7
5

The Unfunded Liability...

is a bright red carbuncle on the tip of Parnell's nose! He simply refuses to pay down the state's share... the man is fiscally incompetent.

highflyer
517
Points
highflyer 01/28/13 - 04:17 pm
4
7

Glacierdogs - does not

Glacierdogs - does not believe in climate change (his FTF comment above) and wants to balance the city budget on the backs of whom?

the poorest among us also the ones that stand to be hurt the most by climate change

highflyer
517
Points
highflyer 01/28/13 - 04:29 pm
7
6

Our Reps should work to bring

Our Reps should work to bring back the 300+ state jobs to SE (millions in revenue) that Sean Parnell & Palin moved up north out of spite.

catandmouse
657
Points
catandmouse 01/28/13 - 04:45 pm
5
11

I am more than happy to pay a

I am more than happy to pay a state income tax. The last thing I want to see is our social services cut.

glacierdogs
1330
Points
glacierdogs 01/28/13 - 04:47 pm
5
4

highflyer

No, climate change in Alaska will help the poor because heating costs will be less.

The loss of the forest products industry meant the loss of political power in Southeast. If those 6,000 private sector, year-round jobs could be replaced then the political power and the lost state government jobs would soon follow. On the other hand, the state is running out of oil.

highflyer
517
Points
highflyer 01/28/13 - 05:59 pm
5
3

Wow and to think all this

Wow and to think all this time I thought power was in the people & workers were the real job creators.

Wink Dinkerson
216
Points
Wink Dinkerson 01/29/13 - 08:28 am
1
1

No, we can't

I don't see how, considering the downturn in oil revenues that to a large extent power our economy. At least, not at the level we're accustomed to. Too bad you're associated with a global warming denial group but I thank you, Mr. Kahklen, for giving us food for thought.

Rangeronetwo
368
Points
Rangeronetwo 01/29/13 - 01:46 pm
2
2

~~~~

Maybe they could stop over paying public servants? Pharmacist Bartlett Regional Hospital $64.97 - $73.89. A CNA should be able to put 10 pills into a bottle. The parmacists don't offer any medical help. That's what the doctor was for.

Helterskelter
379
Points
Helterskelter 01/30/13 - 09:54 pm
2
0

Can't you see it coming ?

Yes indeed folks there is something headed our way and it is called a State Income Tax. As the demand for services increase and the funds that support those services diminish, you better have a plan. Since the State and CBJ have no means of firing up the money printing presses like the good people in DC it makes me believe that a state income tax looms on the horizon. Let the screaming begin!

If in fact 90% of the CBJ budget is slated for personnel costs, then we really have a problem. Time to trim some fat I'd say. It has always appeared to me that most of the CBJ employees are grossly over compensated compared to others performing similar functions in other locations.

cheeesypoof
1896
Points
cheeesypoof 01/30/13 - 12:41 am
1
2

hmmm,

"step outside and feel the 5 degree wind in your face to wake you up on global warming...."

Cuz it's never cold in January...

confusing weather with climate, always a good indicator of a climate change skeptic.

First Things First Alaska Foundation is a pro-development organization. That's fine, but Joe's intentions are just a reflection of the organization primarily. FTFAF is not exactly an honest organization, if their homepage is any sort of indication. The first article is a FOXnews pundit story discussing the thievery of environmental organizations. A little investigating proves the article is nothing more than a misguided attempt to discredit conservation programs. That's not the way to develop properly and that certainly does not preserve the economic viability of Alaska. It just spreads lies for economic gain. Joe discredited himself by mentioning his affiliation with the organization in my opinion.

Calypso
6881
Points
Calypso 01/31/13 - 12:45 am
1
1

Juneau is acting like any

Juneau is acting like any other city run by progressives. It's part of their ideology to keep on spending.

The biggest problem was having Botelho for 12 years as mayor.

I see two options when economic development isn't allowed or wanted - increase taxes (which never works because people and businesses change their behavior when there are higher taxes) or start cutting personnel and services.

Back to Top

Spotted

Please Note: You may have disabled JavaScript and/or CSS. Although this news content will be accessible, certain functionality is unavailable.

Skip to News

« back

next »

  • title http://spotted.juneauempire.com/galleries/359852/ http://spotted.juneauempire.com/galleries/376858/ http://spotted.juneauempire.com/galleries/376853/
  • title http://spotted.juneauempire.com/galleries/376843/ http://spotted.juneauempire.com/galleries/368637/ http://spotted.juneauempire.com/galleries/376838/
  • title http://spotted.juneauempire.com/galleries/376833/ http://spotted.juneauempire.com/galleries/376823/
Juneau Birds

CONTACT US

  • Switchboard: 907-586-3740
  • Circulation and Delivery: 907-586-3740
  • Newsroom Fax: 907-586-3028
  • Business Fax: 907-586-9097
  • Accounts Receivable: 907-523-2270
  • View the Staff Directory
  • or Send feedback

ADVERTISING

SUBSCRIBER SERVICES

SOCIAL NETWORKING