Amidst COVID-19 uncertainty, Assembly begins budget process

Amidst COVID-19 uncertainty, Assembly begins budget process

March 31, 2020 – News

The Juneau Assembly will begin its multi-week process tomorrow, April 1, to determine the City and Borough of Juneau’s biennial budget for Fiscal Years 2021 and 2022. The City Manager will introduce the preliminary budget during a Special Assembly Meeting at 5:30 p.m. in City Hall Chambers, immediately followed by an overview presentation on the proposed budget at an Assembly Finance Committee meeting. The City and Borough of Juneau’s Facebook page will Facebook Live both meetings.

In light of the COVID-19 pandemic, the proposed budget may not fully take into consideration the potential impact of the virus on Juneau’s community and economy. Given the unprecedented level of uncertainty, the budget that eventually gets approved may be considered an “interim” or “draft” budget, with the intention to return to a formal budget process after the scope and scale of the spread of COVID-19 is more fully understood.

As it stands, the manager’s proposed citywide budget of $389 million is up $20.4 million from the FY20 Amended Budget and includes the following major components:

$87.3 million for the Juneau School District, a decrease of $1.3 million (1.5%) over the FY20 Amended Budget. This decrease reflects targeted cuts made by the School District in response to State funding levels.
$152.3 million for Enterprise Funds (hospital, airport, water utilities, docks, and harbors), an increase of $13.9 million (10%) over the FY20 Amended Budget. This change is due to an increase in hospital and airport expenditures.
$78.3 million for general government, a decrease of $2.2 million (2.7%) from the FY20 Amended Budget. This was driven by decreases of one-time funding requests recommended by the Manager and the Assembly, offset by increases in personnel services and insurance costs.
$50.6 million for initial capital improvement projects, an increase of $11.1 million (28.0%). Additional appropriations may be made throughout the year as funding gets committed.
$15.7 million for the bond debt service budget, a decrease of $1.0 million (6.1%) over the FY20 Amended Budget. This reflects a reduction in outstanding school construction debt, as multiple bonds were fully paid off during FY20.

In light of COVID-19, the budget reflects revised projections of sales tax revenues and cruise ship passenger fees due to the impact the virus will have on Juneau’s 2020 and 2021 cruise ship seasons. Additionally, the budget proposes a property tax increase of 1 mil, for a total mill levy rate of 11.66. The breakdown of the proposed mill levy is: 10.46 mills for the operating budget, an increase of 1.0 mills over FY20, and 1.2 mills for debt service, remaining flat over FY20. With this proposed change, CBJ is projecting to collect $57.6 million in property tax revenues in FY21 which would offset the depletion of unrestricted fund balance and restricted budget reserve in light of reduced revenues from sales tax and passenger fees due to the COVID-19 pandemic.

For more information, contact Finance Director Jeff Rogers at 723-6907 or [email protected].