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Among the things the Mat-Su Borough Assembly is proud of at the end of this budget season is that state revenue-sharing money was used to reduce the tax rate rather than to give residents a discount on their taxes.
Both moves use state dollars to wind up with lower tax rates. So what’s the difference? We’re glad you asked. But get ready, because the answer is complex.
The borough has a revenue cap, which is calculated based on the previous year’s tax rate. That revenue cap says the borough can only boast taxes a certain modest percentage above the previous year’s tax rate.
By offering that state money as a rebate, the borough was able to calculate the amount of taxes that could be raised this year based on a higher number than people actually paid. By using it to reduce that base number, the borough now has to start with a lower number in figuring out the tax rate next time budget season rolls around.
We struggled with how to explain all this in Wednesday’s budget story without eating up too much newsprint, and finally decided to leave it on the cutting room floor and revisit the most important details here.
Budgets aren’t flashy, and budget discussions get very technical, very fast.
However, part of our job at the Mat-Su Valley Frontiersman is to digest what we’re hearing from the borough, weigh it against what we know about previous budgets, leaven it with criticisms we’re hearing from the community and serve it to our readers in a way that saves them from banging their heads against those numbers as we did.
And while we don’t fault the borough for its nearly impenetrable budget discussions, there’s one thing we think they could do to make this whole process a lot easier for everyone: please stop the spin.
Each year the borough finds a new way to make its budget numbers shine.
Last year, the tax rate was more or less flat, until the borough used those revenue-sharing dollars to give taxpayers a rebate.
“Taxes went way down!” was the borough’s main message. We — and others — were understandably confused.
This year, the message at the start of budget season was that mill rates were up, but home assessments went down, and thus tax bills also would go down. Now the message is that taxes are flat — except for the bonds voters passed. Those should be counted separately. And none of these discussions even bring up road and fire service area taxes.
We know that it is in the borough’s interest to polish these numbers and present them to the public in the most favorable light. But that kind of spin doctoring makes a subject that is already hard to understand even tougher when all people really want to know is will we pay less or more this year.