Anchorage budget banks on Dunleavy PFD promise
On Tuesday, the Anchorage Assembly approved the city's biggest budget yet, totaling $525 million. The measure was passed after some emergency services and funding for flowers were pulled off the chopping block.
The final budget, including an amendment from Mayor Ethan Berkowitz's administration, was approved on a 9-2 vote with Amy Demboski and Fred Dyson voting against it.
The amendment eliminated a $2.4 million cut to the Anchorage Fire Department, which Chief Jodie Hettrick warned could increase response times citywide by as much as eight minutes.
Not only did the administration do away with the proposed cuts to AFD as well as the muni's flower program, it added more money to the budget for initiatives like illegal homeless camp clean-ups and case management.
The move is based on the assumption of a larger Permanent Fund dividend next year because of Mike Dunleavy's election as governor. With a larger dividend, the municipality hopes to recoup more money in wage garnishments for things like unpaid citations.
As a candidate, Dunleavy campaigned on paying a full dividend, but as governor, he can't appropriate that money without legislative approval.
"He promised a $6,700 PFD; we budgeted for a $2,500 PFD," Assembly Chair Forrest Dunbar said Wednesday morning. "Under statutory formula before [Senate Bill] 26, it would have been, I believe, about $2,900, so I think it's not an unreasonable assumption. But if it doesn't happen we have a chance to go back and revise the budget later next year."
Demboski had harsh words for the budget Tuesday night, saying the city couldn't afford its spending levels.
"This budget is not sustainable," Demboski said. "There comes a time where you can't grow money on trees. There comes a time where you have to prioritize. I've tried and tried every year and unfortunately, I haven't been successful for the taxpayers for this community, and for that I'm sorry."
Demboski said there was fluff that could have been taken out of the budget to make it smaller and save taxpayers money, but Berkowitz said the budget is needed as Anchorage grows.
Dunbar notes that the budget doesn't include revenue anticipated from the $1 billion sale of city-owned utility Municipal Light & Power to Chugach Electric.
Traditionally, Dunbar says the city does base the budget, in part, on a prediction of PFD's.
"I remember when the original PFD cut happened, and it was sort of a surprise. It left, I think, a million or a million, five [thousand dollars], [it] was one of my first years on the Assembly when that happened," Dunbar said.
In September, Assembly members became aware of a several-million-dollar shortfall in the city's account, based on a data error that stemmed from the 2017 budget. Even so, the city passed a larger budget Tuesday based on Duleavy's campaign promise.
Dunbar defended that decision, saying it was based on a $2 million to $3 million "recalculation" by the Berkowitz administration that balanced the budget.
"We're talking about far less than 1 percent (of the final budget), and if Mr. Dunleavy were to go back on his campaign promise and the people around him were to go back on their campaign promise, we would be able to re-calculate next year," Dunbar said. "I'm sure we would be able to find a way to plug that gap."
Cassie Schirm contributed information to this story.
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