Unlike some Lower 48 real estate markets in free-fall, Juneau's property values are stable, city Assessor Robin Potter said last week.
Potter had forecast declining values in the borough, but after completing a review of 2008 property transactions and talking with local agents, she changed the local market outlook to stable.
That's good news for the city's budget.
Instead of a $5 million-plus annual shortfall starting in 2011, city Finance Director Craig Duncan forecasted deficits of $4.1 million in 2011 and $4.6 million in 2012 at an Assembly Finance Committee meeting last week.
The new outlook from Potter and Duncan does not include any potential impacts from the pending Kensington mine opening. Both said more jobs and construction activity at the mine would further improve city finances.
"We're moving in the right direction," Duncan told the Assembly. "But at this point we're still looking at a sizable shortfall."
The total value of taxable property in Juneau also came up higher than expected, after staff added new construction and business personal property value that was initially overlooked.
Idaho-based Hecla Mining Co., owner of the Greens Creek Mine on Admiralty Island, is the largest private property owner. Its property value increased by $24.5 million in 2009, to $101 million, which corresponds to $1 million in property taxes in 2008 and about $1.4 million this year, Potter said.
"That's a $400,000 increase, just at Greens Creek," Potter said.
Commercial property improvements like those at Greens Creek resulted in higher values that offset a slight decline in residential values, Potter said. Her final analysis resulted in a 1 percent overall decrease in property values.
"That's considered very stable," she said. "There were some areas in the borough that received very substantial decreases, but some were negligible to no decrease."
Assessments are based on sales through Jan. 1, but Potter also took into account market trends to make her projections. She said that while sale prices were going down in the fall of 2008, real estate agents told her this spring that they were seeing a return to market activity.
"Their overall belief was that the downturn was over and we'd go back to normal business," Potter said.
Contact reporter Kim Marquis at 523-2279 or firstname.lastname@example.org.
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