Juneau, Alaska (KINY) - City Manager Rorie Watt and Finance Director Bob Bartholomew were the featured speakers at the weekly luncheon of the Greater Juneau Chamber of Commerce.
Bartholomew said the CBJ has a stable fiscal situation due to growing revenues and solid reserves. He did have questions about the future. Over the last 10 years tax revenue has grown from $83.9 million in fiscal year 2011 to $106.3 million in fiscal year 2020.
Marine passenger fees have grown from $11.6 million in fiscal year 2013 to $15.2 million in fiscal year 2020..
The budget this year projects general government expenditures to grow to $109.5 million for fiscal year 2022.They also project an increase in 1% sales taxes to $4.1 million by 2022.
While local taxes appear strong, the impact on the economy from the state budget is harder to quantify.
"We project 1% revenue growth which doesn't sound outrageous considering the cruise ship numbers but what is going to happen with state jobs and investment in Alaska. That is a hard one to predict."
He also predicted a decline in fund balance in general government from $16.2 million to $11.7 million over the next three years.
Capital project expenditure s total $408.8 million since 2013. They also have improvements planned at Juneau International Airport, Docks and Harbors, and perhaps a new city hall. Another pending project is improvements for Centennial Hall.
"One thing the city does a really good job at is managing and developing capital projects.'
The CBJ also plans to reduce debt from $161.2 million in fiscal year 2016 to $67.2 million in 2025.
"I think there are challenges coming and we will be prepared," he added.
Another key issue in the future is solid waste and the disposal of garbage. Bartholomew said the CBJ recycling programs are really going to have to ramp up to lengthen the life span of the landfill.
While the number of citizens and jobs have declined, the gross wages in Juneau have increased in the past few years.
Bartholomew also expressed concern about the state's lack of a capital budget in the last couple of years.
City Manager Rorie Watt said two years ago he told the Assembly they should analyze the business case for a new city hall. They have spent $750,000 each year to rent office space downtown. Annual maintenance and utility costs at the existing city hall equal $250,000 per year. They have city employees spread all over the place. "It is not efficient... what we do," he added.
He proposed to add two floors on top of the Main Street parking garage, some 46,000 square feet. The estimated cost is $26.7 million. "There are merits to the idea."
If they vacate the existing city hall that could be used for private purposes like housing. He suggests it would help keep downtown vibrant.
The project would be financed by 30 year general obligation bonds and likely include a sizable down payment.
"In a period of time we would own our own building. When you plan to be in business forever you should own your own building."
The mill levy could increase by 0.09 to 0.15 mills depending on options the Assembly chose. The annual increase in property taxes per a home worth $350,000 could be between, $31.50 and $52.50. Watt estimates it will save the city $750,000 per year in utility and maintenance costs.
"I think there are strong arguments to stay downtown. We are a public process entity. People suspect we are stampeding toward a conclusion but we are not."
The former Walmart building is too big, the land costs $11 million, and needs extensive and costly renovations. It would reduce the property taxes collected each year by $116,000, he added. "The public is interested in it so we will analyze it," he added, "Renovating a box store to municipal offices is a bad idea."
Watt said he is trying to convince the public that right now what the city is doing doesn't make sense. A public vote would be required on a bond issue. Right now they are engaged in getting public input and comment. Some of the questions they want answered. Is it the right time? Is there ever a right time? Is there a ever a wrong time?
Watt said it is a good time for construction due to the good bidding climate and the good impacts on employment and the economy.
"Is there a business case for a new city hall, its a great question for the city to look at."
He welcomed comments from the public.
Rep. Andy Story said the house approved a legislative proclamation to honor two Auke Bay elementary teachers who retired with 36 years of education experience,. Today is the last day of school in Juneau.