On Tuesday, May 7th, the Kenai Peninsula Borough met to discuss the Mayor’s proposed budget for fiscal year 2025, which is set to begin on July 1st.
According to Mayor Peter Micciche, the goal of this fiscal year is to reduce mil rates whenever possible, minimize the impacts on taxpayers, and maintain an affordable revenue/trajectory over time. The FY2025 budget is a continued, everyday effort to manage costs at or below the cost of living increases over time.
Tight belts, prioritization and resisting the expansion of services are key principles requires a structured philosophy that must remain a key objective over time.
The Borough’s major budgetary goals for FY2025 include:
- An ongoing effort to be accountable to taxpayers, reducing mill rates when possible, to minimize impacts on taxpayers while maintaining an affordable revenue/expenditure trajectory over time.
- A level of local educational funding that borough residents can reasonably afford and sustain.
- A quality capital and operational maintenance program ensuring the continued use and economic value of borough assets to avoid the added cost of deferred maintenance.
- A continued effort to work with service area boards and residents to understand and support the needs of the Borough Service Areas at the lowest cost possible to their residents.
- A sufficient level of funding for borough departments to ensure their continued ability to meet the needs of borough residents, visitors, and the communities served, through thoughtfully organization.
- A re-balancing of expenditures to revenue sources in the Borough’s General Fund for long-term sustainability.
- Stabilize the borough’s financial condition, including compliance with the fund balance policy.
The Borough’s mill rate is currently set at 4.3. Mill rates measure a property’s assessed value.
The borough expects to receive $178 million from property taxes, sales tax revenue, and other outside sources.
“We have approximately 50% of our revenues are sitting in property tax, and then our sales tax is that the 44 which we all know goes to education as a whole and then our others fees federal, state and interest,” said Finance Director Brandi Harbaugh, “Sales tax is anticipated to be flat this year. We talked a little bit about sales tax and we’re seeing that during the first two quarters from September through December, we are seeing an actual negative .4 on our brick and mortar side. And so we do think the sales tax is flattened.”
The document shows that the general fund expenditure projects for FY25 are around $101 million dollars.
During her presentation of the proposed FY25 budget, Harbaugh said that education is the borough’s biggest priority.
“So education by far is our largest component that outweighs any of the others,” said Harbaugh.
The budget is set to appropriate $66,151,058 million for the Kenai Peninsula Borough School District Operations, which is around 65% of the proposed budget. Nearly $5 million will go towards debt service, $4 million will be used for capital projects, and $975,000 will be set aside for Kenai Peninsula College.
Revenues and other financing sources of $99,649,616 support the FY2025 general fund budget. This total consists of $47.1 million in property tax revenue, $44.4 million in sales tax revenue, $3.3 million in state revenue, $3.7 million in federal revenue, and $1,024,602 in other revenues and financing sources. Proposed expenditures are more than projected revenues net of a projected lapse; by $291,837.
However, before a final decision can be made, the community will have the opportunity to voice their thoughts on the proposed budgets on May 21st and June 4th.
To review the proposed FY25 budget, visit the borough’s website at kpb.us.
