As we begin a new year, it is timely to reflect on your municipal government's achievements in 2014 and preview the events and challenges for 2015.
The precipitous drop in oil prices over the last six months of 2014 and the continued decline in oil production is cause for concern for Anchorage and for all Alaska communities. Declining state revenues will likely reduce state grants to local governments and reduce or even eliminate revenue sharing.
Fortunately, my administration has implemented new policies and efficiency measures over the last five-plus years that leave Anchorage uniquely prepared to deal with the fiscal challenges ahead.
This is best exemplified by our recently approved 2015 budget. At $473 million, it is $3 million less than the 2014 budget without any reduction in services, a testament to the efficiencies we have implemented throughout all municipal departments.
Our responsible budget management will also result in a sixth straight year of budget surplus. These surpluses allow us to pay for one-time expenses like police and fire academies, rebate money to the taxpayers and to maintain healthy reserve accounts.
Regarding fiscal reserves, we have increased both our operating and emergency reserve requirements by law to guarantee that we have sufficient funds to cover unanticipated expenses. Our conservative monetary policies, including our successful investment strategies, are why Anchorage has achieved a AAA bond rating from Standard and Poor's, the highest rating a city can achieve. We were upgraded from AA to AA+ in 2012, upgraded again to AAA in 2013, and were re-affirmed at AAA in 2014. Standard and Poor's rates more than 4,000 cities, and around 340 of them have a triple-A rating, placing Anchorage in truly elite company.
We maintained our commitment to public safety in 2014, holding two police academies, with another scheduled for 2015. Following an unusually high number of retirements in 2014, our new officers will allow us to increase our staffing numbers and advance our community policing goals. Overall, crime has declined over the last five years compared to the previous five-year average, a good trend for Anchorage.
This year we completed the site selection and planning for new fire stations in Mountain View and in the Huffman area, which will be constructed in 2015. New ambulances, fire trucks and water-rescue craft have all been added to the fire department's resources so our first responders have the best available equipment.
In 2014, Anchorage received over $100 million in capital funding from local bonds and state grants. Our spending has focused on improving our existing infrastructure, including our roads, parks, trails and public facilities. Improvements to all of our Project 80s facilities and the repaving of the Tony Knowles Coastal Trail highlight these investments, as well as several important road connections to relieve traffic congestion.
Our most important capital priority going forward is the Anchorage port modernization project. The port provides more than 85 percent of all the consumer goods that enter Alaska, and after 50 years, is suffering from extreme corrosion of its supporting piles. I look forward to working with Gov. Walker, the state Legislature and our Congressional delegation to secure the funding to complete this essential project.
Labor issues were prominent in 2014, with Anchorage voters supporting the referendum to repeal AO-37, the Responsible Labor Act. However, over the last six months, we have successfully negotiated seven of our nine labor contracts, with two more in progress, and virtually all of the common-sense provisions of AO-37 are contained in each of these contracts.
It's been a good year for Anchorage but challenges remain. We are working hard to finish the implementation of our new municipal computer operating system, which is over-budget and has missed deadlines. It should be noted that the system it replaces, put in place more than 15 years ago, would have cost a comparable amount to implement in today's dollars as the new system.
Another top priority in 2015 will be the replacement of bridges along our trail system that have been evaluated and found to be structurally deficient.
The year 2015, is Anchorage's Centennial Celebration year and many exciting events are being scheduled. It is a great time to show pride in our wonderful community and envision what the next 100 years might hold. To all Anchorage residents, I hope that 2015 will be your best year ever.
Dan A. Sullivan is mayor of Anchorage.
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