How much has the city of Homer spent this year on bullets? Bandages? Beautification? Toilet paper?
A new online tool released this week, Open Budget, allows citizens to probe into the 2015 budget and see where taxpayer dollars go. The tool looks at the operating budget by department and even section, comparing what’s been spent to what has been budgeted as of Sept. 30, the end of the third quarter.
City Manager Katie Koester called Open Budget “crowd source budgeting.”
“I hope you’ll go home and play with this,” Koester said of the new tool. “I think it’s going to be a useful tool for the council, department heads and the public.”
Koester spoke about Open Budget at the latest city Town Hall meeting, the third in a series of public forums on the city’s budget. The forums have sought citizen ideas on how to fund city government for 2016 and beyond.
Based on revenue projections of $10.6 million for 2016, the city faces about a $1 million gap compared to last year’s revenues. It also faces increased expenses for things like health insurance, utilities and personnel. In her budget introduced Oct. 12, Koester presented two budgets. Budget A assumes a budget similar to 2015, but still with about $725,000 in cuts, including things like eliminating a police dispatcher and jail officer. It also assumes $1 million in new revenue. A “bare bones” budget, B, is more severe and assumes no new revenue, with cuts to cops, libraries and Community Recreation.
To close that $1 million gap and fund Budget A, the Homer City Council put on the ballot Proposition 1. In a special election on Dec. 1, voters will be asked if they approve diverting to the general fund for three years .75 percent of sales taxes currently allocated to the Homer Accelerated Roads and Trails program.
If passed, about $1 million in sales taxes would go to the general fund from the HART allocation. About $7 million accumulated over the past 10 years and in the HART fund would not be touched. The sales tax would not be raised.
Homer Mayor Beth Wythe noted that an ongoing cut to revenues has been about $900,000 a year lost in sales taxes from the imposition by Kenai Peninsula Borough voters in an initiative creating a September-May suspension of sales taxes on nonprepared foods.
Koester also introduced another tool to be used to understand how cuts would balance the budget. An Excel spreadsheet that can be downloaded shows how checking and unchecking various proposed cuts in Budget A or Budget B affects the balance. The spreadsheet doesn’t allow for making cuts in other ways or to add new revenue.
“You can go online and play with this,” Koester said. “There are tangible cuts on the table.”
With the new Homer City Council sitting behind her as she spoke in the Cowles Council Chambers, and about 20 people attending, Koester also laid the groundwork for the Town Hall discussion.
“These guys are sitting up here and not in the audience so you can have some back and forth,” she aid. “The policy questions, the true hard questions, I get to punt to these guys.”
Homer citizens didn’t disappoint. Ken Castner challenged the existence of some funds that aren’t earning money and aren’t being spent, like the $7 million HART fund and the $2 million Permanent Fund.
“I do not believe a municipality has to have lots and lots of money stashed away in funds,” Castner said. “I’d really like to have more of a focus on why it is we need to have such big hunks of money tucked away. If it’s not a project and not on the capital improvement project list, I’d like to know what it’s doing in reserves.”
Castner also questioned how administration fees get spent.
For example, in 2015 to date $144,000 was moved from the HART fund to an account called “general fund, administration.” That’s more than $84,000 spent in 2014 for traffic calming measures like speed humps in Old Town.
“Everything requires administration,” Koester said. “What the appropriate level is is up to debate.”
Discussion also turned to raising revenues from other sources. Kyra Wagner asked if the city had considered working with the Kenai Peninsula Borough to create a southern Kenai recreation district to expand the tax base to include residents outside of city limits who use recreational and cultural facilities.
Koester said there’s been such a movement with Recreate REC, a recreation advocacy group.
“We’re willing to work with community groups. It makes sense that services provided regionally are funded regionally,” Koester said.
Wythe also said that the borough is working on putting on a future ballot a proposition that would raise the amount of sales tax paid from taxes on up to $500 in purchases to $1,000 in purchases.
Castner also suggested that the senior property tax exemption be addressed. In the borough, for a full-time resident 65 and older, the first $300,000 in assessed value is affected. The state mandates a $150,000 senior exemption.
Rep. Paul Seaton, R-Homer, said there has been discussion in the Alaska Legislature about making that optional and to be decided by the cities. The cities would rather the Legislature make that decision, he said.
“If the city wants that removed, they should talk to the Legislature,” he said.
At the end of Monday’s Town Hall meeting, Koester urged people to keep working. If Prop 1 passes, it would divert for only three years the HART allocation to the general fund.
“Three years is going to go by in a flash,” Koester said. “I know because I have a 3-year-old, and did that go by quickly.”
Previous meetings looked at revenue ideas like a bed tax, a seasonal sales tax increase, and excise taxes on alcohol and cannabis.
“It’s time for us to work through these issues, these opportunities,” Koester said. “That will take a lot more work.”
To access Open Budget and the Excel spreadsheet on proposed 2016 budget cuts, visit the city of Homer website at www.cityofhomer-ak.gov.
As of Sept. 30, the city has spent $14,635 on ammunition for police training, $9,150 on supplies for ambulances including bandages and medication, $922 on Pioneer Avenue beautification, and $12,300 for janitorial supplies, including toilet paper.