Sullivan Wants Most of $11M Surplus Refunded to Taxpayers

Remainder Would Go To Other Financial Obligations

April 13, 2011|By Jason Lamb | Channel 2 News

Jason Lamb/KTUU.com

ANCHORAGE, Alaska — Anchorage Mayor Dan Sullivan has announced what he wants to do with the extra money left over from the city's spending plan last year.

Of the total $11 million budget surplus, $6.7 million would be returned to taxpayers in the form of a property tax reduction this year, under Sullivan’s proposal.

Sullivan's budget director, Cheryl Frasca, says the extra money from last year resulted from city departments spending less than what they were budgeted, as opposed to higher-than-expected revenue brought in from things like fees, fines and city investments.

She referred to the money as a year-end "lapse" of unspent funds, as opposed to a surplus.

After the $6.7 million refund to taxpayers, Sullivan says the remaining money will be used to pay off several financial obligations that the city holds:

$3.1 million will pay off a loan used to purchase a former Alaska Greenhouse property back in 2006. The final loan payment is due in October of this year.
$750,000 to clean up soil from a former ML&P generator site on the present-day Glenn Square Mall, which was later dumped onto city-owned land at Reeve Boulevard, contaminated with a pollutant known as PCB.
$700,000 to clean up soil at the Kincaid Park contaminated with lead. Parts of the park used to be a biathlon range.

Sullivan's announcement came at his weekly press conference, at which he also announced several changes he's proposing to the 2011 budget. They are part of the final tweaks that the mayor's office and Assembly members typically make to the budget in April, before the tax rates are set later in the month.

Some of Sullivan's proposed additions are:

$882,000 to fund a 28-person police academy in the last part of the year.
$84,000 to pay for an additional domestic violence prosecutor.
26 firefighter positions and three safety officer positions, funded by a $1.6 million federal public safety grant, and $203,000 of local funds.
$349,000 to fund 6 EMS positions to run a new ambulance in the Sand Lake area. Voters approved a bond during the April 5 election that funded the ambulance, as well as the costs to operate and maintain it. Voters also approved $708,000 in additional programs and operations and maintenance costs associated with approved bonds.
$250,000 to retrofit a warehouse to store property seized from illegal homeless campsites.
$227,000 to pay for increased public transportation fuel costs.

The mayor's proposed changes announced Wednesday do not include any changes to bus service or the restoration of the Samson-Dimond branch library; two things that some Anchorage Assembly members were disappointed to see cut from the 2011 budget.

Assemblywoman Elvi Gray-Jackson says providing tax relief is a good first step, but she thinks there should be some city services put back in, too.

"Provide bus service for folks who really really need it," said Gray-Jackson, "and also possibly consider bringing back the Samson dimond library, especially because its rent free for two years."

Sullivan says reinstating services would only put off difficult fiscal decisions that will have to be made in the future.

"If you restore services now and you’re looking at $12-15 million in deficit next year, what have you accomplished? You’ve kicked the can down the road," Sullivan said.

The proposal also details revised revenue projections. Among them, the city is counting on collecting $700,000 less than expected in the city's tobacco tax. The city says it suspects people stockpiled cigarettes prior to the tax increase instituted earlier this year.

The Assembly has the final say on budget matters, with a final vote expected in about two weeks, during a meeting in which assembly members can approve or turn down Sullivan's budget changes, or add their own.

Contact Jason Lamb at jlamb@ktuu.com

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