The Municipality of Anchorage faces an estimated $40 million budget gap, according to numbers released by Mayor Ethan Berkowitz at a meeting Friday.

The municipality’s 2017 budget is $502 million, up from $497 million in 2016.

“We are dealing with tough times in Anchorage and we are dealing with tough times because the state has shifted a lot of costs in our direction and at the same time state has stopped us from getting revenue, particular from Municipal Light and Power that we have historically used,”Berkowitz said.

Of the many cost-cutting measures revealed by Berkowitz, the biggest was the reduction of 19 jobs outside the city’s public safety sector. The municipality also expects to save $926,000 by reducing firefighter overtime and $320,000 by reducing holiday bus service.

At the same time, the municipality is looking to hire 56 additional police officers in 2017.

“There is one item I felt it was imperative to increase and that’s the size of the police department,” Berkowitz said at the meeting Friday. “Public safety is a non-negotiable item.”

Myer Hutchinson, communications director for the Municipality of Anchorage, said of the nearly $40 million hole that had to be filled, $24 million is comprised from state charges.

Of the $502 million budget, $7 million is slated for the beleaguered SAP project to upgrade city data systems. The rest, he said, are mostly labor costs.


The administration expects to pull revenue from various sources, including $2.3 million from the new commercial marijuana industry. It also anticipates $8.9 million in revenue from last year’s savings, as well as income from new port fees, increased solid waste service fees, and taking a larger draw of 4.25 percent from the municipal trust.

However, even those measures mean the city will need to make $7.5 million in cuts. The largest cuts were listed in a document handed out at the meeting.

Additional Projected 2017 Cuts:

  • Fire – $926,000

  • Finance – $719,000

  • Maintenance and Operations – $677,000

  • Public Transportation – $320,000

  • Employee Relations – $253,000

  • Mayor – $247,000

  • Development Services – $200,000

  • Library – $150,000

  • Municipal Attorney – $139,000

  • Planning – $113,000

  • Parks & Recreation – $100,000

This is a developing story; check back for updates.