Along with the Assembly and school board seat races on this spring’s ballot, Anchorage voters will choose whether to approve several municipal bond proposals totaling more than $45.6 million, and a school district bond proposal of more than $111 million.
The money will be used to pay for things like improvements to roads, parks and school buildings and the construction of a new elementary school building, as well as upgrades to the city’s transit system and public safety equipment, among others.
Bonds work similarly to a mortgage or loan, and are tools commonly used by school districts and local governments to fund projects. But first, voters must approve the sale of a certain amount of bonds to investors. Then the city repays that amount over time, plus interest, via property taxes.
It’s difficult to estimate exactly how and when the bonds would impact taxes because each year the city pays off old debt, the new bonds aren’t issued all at once but over the span of years, and because interest rates fluctuate, according to Travis Frisk, the city’s chief fiscal officer.
“Just because you approved the bond in 2022, doesn’t mean it gets issued in 2022,” he said. Projects take time, often years, so it can take several years before the bonds are issued. That delays the impact of newly approved bond propositions on taxes.
If interest rates held steady (they won’t), the total impact to taxes would be $11.23 per $100,000 for the $45.6 million bond package. Coupled with a 91 cent increase to the tax cap, that’s about $36 for an owner of a $300,000 home. For the school district’s bond package, that same homeowner would pay $74, or $24.73 per $100,000 in assessed property value.
The bonds are on top of the city’s property tax cap, Frisk said.
[Anchorage homeowners see jump in property values in 2022 assessments]
While the city generally issues new bonds each year, it also pays off debt each year, retiring old bonds. That helps balance the tax burden on property owners, counteracting some of the net tax impact. This year, the city expects to pay off more than $38.4 million in principal, according to its bond FAQ. As of Jan. 1, the city owes a principal balance of more than $428.6 million in previous voter-approved bond debt.
Ballots are slated to be mailed on March 15 for the April 5 election.
Anchorage School District — Proposition 1
This year the school district is proposing $111.09 million in bonds. That number may seem unusually high, but it reflects a recent switch from an annual to an every-other-year bond cycle. Voters last year got a break and didn’t see a school bond on the ballot. Generally, recent annual school bonds have ranged between $50 million and $65 million.
If it passes, a large chunk of the money, more than $30.9 million, would go toward constructing a replacement building for Inlet View Elementary School in South Addition. Voters in 2020 approved the district’s bond package, which included $3.34 million for the design of the school. Now, the district is pushing to get the project off the ground.
Another $32.7 million would go toward replacing roofs at 14 elementary schools and toward structural and seismic improvements, and $12.9 million would go toward fixing the Lake Otis Elementary School building. Millions more would be designated for safety improvements at other schools, including East High, along with other projects and designs.
It would cost property taxpayers about $24.73 per $100,000 of assessed property value.
Capital improvements — Proposition 2
This $2.4 million bond proposition would go toward fixing and upgrading multiple city facilities, including replacing fire alarm systems; a few roof replacements and renovations; sprinkler systems; seismic bracing; and lead and asbestos abatement, among other improvements. It would raise property taxes by 48 cents per $100,000 of assessed property value.
Emergency medical services, public safety and transit — Proposition 3
Anchorage is proposing $2.38 million in bonds to replace fire ambulances; fix or replace public transportation equipment and vehicles; upgrade its area-wide radio network used by all city public safety and utility departments; and improve some school zone safety areas. It would cost taxpayers 47 cents per $100,000 in assessed property value.
Anchorage roads and storm drainage — Proposition 4
This $34.87 million bond proposition would fund 39 road and drainage projects. Those include fixing and reconstructing road surfaces, upgrading signs, lighting and signals, and some pedestrian safety improvements.
It would increase property taxes $8.93 per $100,000 in assessed property value, but only for property owners within the Anchorage Roads and Drainage Service Area. It would not impact owners in Chugiak, Eagle River, Girdwood and other outside areas.
This proposition also comes with a 27 cent annual increase to the city’s tax cap to pay for the operation and maintenance of the proposed improvements.
Anchorage parks — Proposition 5
A proposed $3.875 million in bonds would fund renovations, rehabilitations and safety improvements in Anchorage’s parks, trails, playgrounds and athletic fields. It includes projects at the Chester Creek Complex, Russian Jack Springs Park, Campbell Creek Trail, Chanshtnu Muldoon Park, the Government Hill area and the Ship Creek Trail to the Tony Knowles Coastal Trail connection, among others.
It would cause an annual increase in property taxes of 90 cents per $100,000 in assessed property value, along with a 64 cent annual increase to the tax cap for continued operation and maintenance costs.
Fire service — Proposition 6
To replace fire engines and improve fire department facilities, Anchorage is proposing $2.1 million in bonds. It includes funding for two fire engines and converting Old Station #3 into a facility for light vehicle maintenance. This would increase property taxes by 45 cents per $100,000 in assessed value.