Municipality of Anchorage asks for a Permanent Fund dividend
As the Anchorage Assembly weighs tax proposals from three of its members, Mayor Ethan Berkowitz says the municipality is asking the state to chip in too.
Like individual Alaskans, Mayor Ethan Berkowitz suggests that communities like Anchorage receive a Permanent Fund dividend. The concept is one of the municipality's legislative requests for the upcoming session on Jan. 21.
"What the state hasn't done with its fiscal planning is to integrate the local governments in terms of what it's going to look like because we both provide services to the same constituencies," said Berkowitz. "A community dividend, in essence, would mean you would divide the dividend payout between state government, the dividend itself and local government."
In the past, the municipality has benefited from state revenue sharing, also called community assistance, but that program has dwindled as legislators and the governor grapple with how to pay for state services.
"In the mid-80s we had 40-45% of the local budget was directly covered by the state. Today it's 1%," Berkowitz noted.
In 2018, the Alaska Legislature approved a framework within which the state could use some of the permanent fund's earnings, from which dividends are paid, to cover the cost of state services.
"We could do things like plow some of the state road and that would do things like reduce costs at the state level, and at the same time give us increased capacity locally," Berkowitz said.
Currently, Anchorage's budget is at a historic high, up by about 14% since the start of the Berkowitz administration in 2015.
"A lot of it's due to the fact that we've added more than a hundred police officers to the force, that's sort of the bulk of where the increased costs come from," Berkowitz said. "But we've also had inflation we had to contend with and additional responsibilities. For example, one of the most dramatic ones was when the state pulled troopers off the Seward Highway, we had to put police officers in. And so, we've had to absorb responsibilities and that's just been part of what's gone on."
Anchorage Assembly members have unanimously approved a set of priorities for 2020-2021, focusing on homelessness, public safety and economic development. The plan calls for increased spending and new hires.
Of the proposed revenue measures, the mayor says he's optimistic voters will approve an alcohol tax.
"I think part of what we did last year introduce the public to the concept. We saw a massive funding effort by the alcohol industry that sort of expressed its displeasure with the tax proposal," Berkowitz said. "But when we explain it again and have a chance to lay out why an alcohol tax makes more sense, I would hope that the voters of Anchorage would support it."
Berkowitz and Anchorage Assembly members will host a series of town hall meetings to talk about the municipality's finances this week.
- Jan. 7 – Z.J. Loussac Library, 6–7:30 p.m.
- Jan. 8 – Chugiak High School, 6–7:30 p.m.
- Jan. 9 – Girdwood Community Room, 6:30–8 p.m.
Assembly Chair Felix Rivera says the discussion will help direct members on which tax proposal to move forward.
Public hearings on the tax proposals will be held at the Anchorage Assembly's Jan. 14 meeting when the body plans to vote on which proposal to move forward to the ballot.
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