Budget holds no reduction in essential service

Prior to my taking office, the city budget grew by over 50 percent in just six years, from $289 million in 2003 to $433 million in 2009. This rate of growth was simply unsustainable, and we have worked diligently from day one to implement a more balanced and responsible level of spending.

This has been a significant challenge. The tough economy has resulted in lower revenues in some categories. Expenses continue to rise, the most significant of which are the rapidly rising costs of labor. It will cost an additional $12.4 million to pay for the same number of employees as last year, performing the same work.

After amendments by the Assembly, the 2012 budget totals approximately $452 million, a two percent increase and includes $228 million in property taxes, an increase of just 1.6 percent over the previous year. The approved budget comes in at over $1 million below the tax cap. It should be noted that about half of the budget increase is for the costs associated with voter-approved bonds.

Included in the 2012 budget is funding for 29 new firefighters and 28 new police officers, reflecting our commitment to public safety as the top community priority. We have also included full funding for other essential services such as road maintenance.

Next year's budget shows our continued efforts to find efficiencies in government. A continuation budget from 2011 would have been more than $15 million in deficit, and in order to achieve a balanced budget, savings had to be identified and additional revenues added.

By reviewing a several-year history of department budgets, we found that there were several categories which had been traditionally over-budgeted. We appropriately reduced those budget items, saving over $6 million in unnecessary spending. Our budget department, under the leadership of director Cheryl Frasca, has done an outstanding job of bringing budget accountability to city government.

Other efficiency initiatives scheduled to come on line in 2012 include implementation of our electronic timecard system and new systems for accounting and property appraisal. We also have an efficiency study being conducted by CH2MHill. They are analyzing our fleet maintenance and our grounds and facility maintenance to determine if we can find savings and improve performance.

Because of these progressive initiatives, our CFO, Lucinda Mahoney, recently received the Alaska Municipal League's "Innovation in Revenue and Finance" award. While some of these initiatives take significant investment, they will result in long-term savings for taxpayers.

The other part of the approved 2012 budget is the capital budget, which includes bond propositions for which we will be seeking voter approval in April and state and federal grant requests. The bonds total a modest $32 million, primarily for road projects as well as public safety, transportation and park improvements.

Our state legislative plan includes a statewide ports and harbors bond that would be voted on in the state elections this fall. In his recent budget presentation, Gov. Parnell proposed a $350 million ports bond of which $200 million is for the Port of Anchorage. I appreciate the governor's understanding of the port's vital role to the Alaska economy and his confidence that my team has got the expansion project back on the right track.

Ultimately, the decision will be up to our legislators. We will work hard over the next several months to inform them of all the steps we have taken to correct the mistakes made on the Port Expansion Project prior to my administration coming on board.

I want to thank the public for their input, the Assembly budget committee led by Bill Starr, and the Budget Advisory Committee chaired by Andy Clary for all their hard work on this year's budget.

Dan Sullivan has been mayor of Anchorage since 2009.