Anchorage is running out of time to find new revenue sources before government services will need to be cut to balance the budget, Mayor Suzanne LaFrance said Friday.
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“It’s a fact that our costs here at the municipality continue to rise at a level that is higher than our revenue,” LaFrance said at a press conference to unveil her proposed budget.
LaFrance’s budget would use $12 million in one-time funding, in part, to balance a $15 million deficit.
Last year, city officials warned of an impending fiscal cliff. Now, LaFrance said, it’s right around the corner.
“We will hit that fiscal cliff next year, and that $15 million budget gap is projected to almost double,” she said. “We’ve busted open our piggy banks and bought ourselves one more year.”
LaFrance’s budget proposal totals about $692 million. That’s roughly $35 million more than this year’s budget. The newly proposed budget mostly keeps services funded at the same level, with about $1 million in cuts from unfilled positions, LaFrance said.
Like past Anchorage budgets, the revenue for this one comes mostly from property taxes.
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There’ve been several proposals for a city sales tax since LaFrance began her tenure as mayor.
The Anchorage Assembly voted against putting its own 3% sales tax proposal to voters in 2025, while LaFrance set aside her proposal for a similar tax earlier this year.
Ona Brause, who heads Anchorage’s Office of Management and Budget, said the city will likely have to cut core services if it doesn’t find new revenue.
“This is a long conversation that is going to be about foundationally changing the way that we have revenue and spend within the Municipality of Anchorage,” Brause said. “So the idea that there are things on the table or off the table, I don’t know that that is the case in this situation. Everything is on the table.”
LaFrance said her office will hold a series of community meetings in the coming weeks to discuss the city’s finances with the public.
The Anchorage Assembly is set to introduce the budget at its meeting Tuesday. In a statement, Assembly Chair Anna Brawley said the body is set to vote on a final budget on Nov. 17.
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