Mayor Brian Gabriel and City Manager Paul Ostrander gave their State of the Kenai presentation in front of the Kenai Chamber of Commerce on Wednesday at the Kenai Visitors and Cultural Center.
The two discussed local agencies, events, and celebrated some of the city’s successes in 2019, but the meat of the conversation was focused on revenues, sales taxes, and capital improvements.
Mayor Gabriel mentioned his usage of sales tax as a barometer of the city’s economic strength. He displayed a chart showing a positive uptrend in sales tax, valuing the importance of the slide: “Sales tax represents about 50% of our budget, so little increases is a pretty fair increase to the city of Kenai.” He also said that the city expects to see a boost from the upcoming distribution of sales taxes collected from online sellers.
When offering an overview of the city’s budget, the Mayor was proud to point out that almost half of the budget goes to public safety. City Manager Ostrander discussed at length the fact that not enough of the budget had previously been allocated to capital projects, with the state offering Kenai zero money for capital project funding, but that the city now has a five year capital improvement plan to fund maintenance of the city’s infrastructure, including $1.4 million in fiscal year 2021, with an annual average of $1.2 million: “For the first year, the city’s actually produced the capital improvement plan. This is a five-year lookout at what the capital needs are for the city. This was developed by our Public Works department, with other city departments, with our city commissions, and also with the city council. This is a proactive approach to determine the funding necessary to maintain our infrastructure.”
He also made an important distinction about where this capital project funding is actually going: “One other important thing to note here is that this is almost exclusively maintenance of existing infrastructure. This isn’t about building new buildings or shiny new structures. This is just about maintaining what we own. 93% of these dollars goes to maintaining existing infrastructure, with only 7% of this looking at developing new projects within the city.”
Mayor Gabriel mentioned the city’s efforts to drive more businesses to the city, such as incentives for businesses in and out of the city boundaries, as well as avenues to allow people to purchase properties to erect businesses in the city. He advised potential business owners to see a step-by-step business guide in city hall to help prospective business owners see exactly what they need to do to successfully build a business in Kenai.
City Manager Ostrander will be presenting some of this information again at the Kenai Senior Center on March 10 at 6 p.m.