Assembly begins work on proposed 2012 budget of $393 million

PALMER — Are Mat-Su Borough taxes going up or down this year?

Looking at the numbers, it seems the answer to that question is a matter of perspective, and the process is just beginning.

“Our budget is the most important legislative action a board can take because it really shows the priorities of this body,” borough manager John Moosey said while presenting his proposed budget to the borough assembly.

Those priorities, he said, are bond sales to build and upgrade roads, reforming borough regulations, selling borough land, adding space to borough headquarters and streamlining operations, developing skiing at Hatcher Pass and, most of all, Port MacKenzie — both building up an industrial base there and getting rail service to it.

“It is really the capstone of our economic development efforts,” Moosey said.

The presentation pegs the area-wide borough mill levy — the main tax that doesn’t include road service or fire protection — at 10.381 mills. A mill is equal to $1 per $1,000 of a home’s assessed value. Last year that tax stood at 10.051 mills.

So taxes are going up, right?

The borough says they’re not. In a press release, the borough cites a drop in assessed home values, and that drop will more than make up for the mill levy increase to actually drop the average tax bill about $70.

But the 10.051 mills from last year’s budget isn’t quite the full story.

After the borough budget made it through the assembly’s debate process, the borough decided to reduce its reserve funds and use other money from the state and federal government to reduce tax rates by basically a full point.

The assembly could choose to do the same this year. Moosey’s budget sets aside $4 million for the assembly to decide what to do with. Options he suggests include hiring staff to offer new services, looking into borough projects the assembly might want to fund and paying the borough’s contribution to school and road bonds voters approved at the ballot box last year. Voter-approved borrowing like that automatically increases property taxes, so that last suggestion would effectively reduce tax rates.

All of this is before taking into account the smaller taxes for road service areas and fire service areas.

In hard dollars and cents, Moosey estimated in his presentation that the average home — a $200,000 home in most borough estimates — taxed under the average fire and road service rates will pay $3,469 in the coming fiscal year. The area-wide tax accounts for $2,195 of that.

All of those tax bills add up to a $393.5 million budget for the year. Moosey promises to hold the line on spending increases, despite rising costs in personnel, utilities, contracts and operation costs.

The bulk of that budget goes to schools. In Moosey’s budget, Mat-Su Borough School district gets $265.7 million. Tax revenue going to schools includes a 3 percent increase the district requested.

Just the beginning

Moosey’s presentation is just the start of budget season. There are many meetings ahead and plenty of chances to give the assembly input. Those meetings are either public hearings — called specifically to listen to testimony — and deliberations — where the assembly decides what to cut and what to add. There is usually a brief portion of those deliberations meetings where testimony is allowed.

Contact reporter Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.

What: Mat-Su Borough public budget hearings

When: 6 p.m., May 2 and May 3

Where: Central Mat-Su Public Safety Building at Lucille Street and Swanson Avenue in Wasilla.

What: Mat-Su Borough Assembly budget Deliberations

When: 6 p.m., May 7

Where: Borough headquarters on Dahlia Avenue in Palmer

Additional deliberations, if needed, are scheduled for the same time and place May 8, 9 and 14.