City Manager Rod Swope and Finance Director Craig Duncan presented an overview of a conservative budget Wednesday that should make 2010 a surplus year and help put a dent into an estimated $5.3 million deficit forecast in 2011.
The latest presentation to the Juneau Assembly's Finance committee followed one Duncan made March 11 that covered rough budget projections through 2014. That was the first time Duncan put a number to the anticipated multimillion dollar budget deficit beginning in 2011.
At the time, the Assembly asked City Manager Rod Swope if the action should be taken this year to soften the blow next year. Swope wasn't ready with an answer ready that day, but was Wednesday.
"It's extremely important we start addressing these future budget shortfalls now, Swope said. "We've got a pretty big problem to resolve, and we're going to do it. We'll get it done."
Besides cutting down on travel and overtime and holding vacancies open, Swope said he will continue to look into more significant cost savings measures. For example, he said he does not intend to fill a special projects position that Maria Gladziszewski left last year, and also will consider merging the duties of the city avalanche forecaster, a position created and filled in November, with the duties of the emergency manager position, a post that Mike Branum left last month for an air ambulance position in Fairbanks.
"I'm pretty much holding the line," Swope said. "I told staff, raising the mill levy is off the table. I'm not willing use the mill levy as a tool to balance the budget. That's your prerogative."
The mill levy is the rate at which property is taxed. A mill is a unit of measure that means one one thousandth; 10 mills is 1 percent. The mill levy is actually set to increase in the new budget year, a decision made previously as part of the Assembly's two-year budget planning process. Swope was referring to any additional tax increases.
Assemblyman Jeff Bush pointed out that even though the mill level is increasing from 10.37 to 10.6 in the new budget year, on average residential property tax bills will decrease because falling property values will outweigh the effect of the tax increase.
That conclusion was drawn from Duncan's projection of an overall 3.77 percent decline in existing residential property values coupled with a 2.22 percent property tax increase.
The Assembly ticked off two initiatives that won't come to fruition in the new budget year: Curbside recycling and most of the improvements to public transportation suggested in a 502-page report the Assembly commissioned with $150,000 in state grant money last year.
Assemblyman Jonathan Anderson summed up what the new budget meant.
"We're not changing level of services. We're tightening our belts. ... We're essentially holding our breath until a year from now, since who the heck knows what a year from now will look like," he said.
Finance Committee Chairman David Stone lamented the budget meeting's low turnout. There were only a handful of people in the audience, most of whom were waiting to participate in the Assembly's next scheduled meeting for a resolution supporting the Alaska Commission on Aging's 2009 legislative priorities, which was approved.
"One of the biggest disappointments (after) five years as chair is nobody shows up, nobody cares - but this is critical," Stone said.