Assembly opts against immediate program cuts after voters OK tax reductions; focus will instead be on next year
- Mark Sabbatini
- Nov 5, 2025
- 3 min read
Updated: Nov 6, 2025
Grant recipients will get remaining 60% of awards withheld before election, but will be asked if they’re willing to give money back
By Mark Sabbatini
Juneau Independent
City leaders say significant budget reductions are coming due to tax cuts approved by voters in last month’s municipal election, but instead of immediately trimming programs they will focus on a more careful evaluation of spending for the coming fiscal year starting next July 1.
The Juneau Assembly, meeting as the Finance Committee on Wednesday night, unanimously approved not making program cuts to the current fiscal year budget, with a provision that new spending might be subject to scrutiny. Also approved unanimously was distributing the remaining 60% of grants to dozens of community groups and individuals, after that funding was put on hold this summer when the tax cut measures were put on the ballot.
The City and Borough of Juneau is projected to lose about $12 million in revenue a year due to voters approving a ballot initiative exempting food and utilities from sales taxes — representing most of that loss — plus another ballot measure lowering the maximum property tax rate. A study by the Juneau Economic Development Council projects an average household will save $944 a year via those measures.
The city’s operating and capital projects budget is about $200 million, not including the Juneau School District and city-owned Bartlett Regional Hospital.
However, that loss will be less during the current fiscal year since the property tax reduction won’t be in effect and the sales tax exemptions don’t start until Nov. 20 — which means nearly five months of the fiscal year will already have passed.
CBJ Finance Director Angie Flick, in a presentation to Assembly members, said the city has sufficient cash reserves to cover a projected $6.4 million shortfall for the remainder of the current fiscal year. Among the reasons is the city’s interest earnings during the past fiscal year were several million dollars higher than projected.
"This would provide the Assembly and staff time to gather information to adjust the course later in the fiscal year or for FY27 through the normal budget process," a memo co-authored by Flick and City Manager Katie Koester states.
A majority of funds the Assembly had approved to CBJ grantees earlier this year was put on hold due to uncertainties about how the election would affect the city’s finances, with grant recipients told an update would be provided by mid-November about the remaining funds. Recipients include groups such as the Juneau Community Foundation, Downtown Business Association, Alaska Heat Smart, Juneau Festival Committee and Parents For Safe Graduation, with numerous individuals such as artists also receiving funds.
A motion by Mayor Beth Weldon asking city staff to ask grantees if they wanted to submit a modified funding request before awarding funds was defeated by a 5-4 vote. The Assembly then passed a measure to distribute the remaining funds with an amendment by Assembly Member Maureen Hall that grantees will be asked if they are willing to return any of the money.
Cuts to programs this year were rejected by a majority of Assembly members, who said trying to evaluate reductions responsibly would consume time that will be more efficiently spent scrutinizing next year’s budget options. But Assembly Member Neil Steininger said it may be wise for city officials to consider delaying or canceling new spending where practical during the remaining seven months of fiscal 2026.
"(That may) make it smoother and easier when we come into our FY27 deliberations," he said, "There's not new things that you're starting three months from now that we may have to cut in the FY 27 budget."
A call to consider some immediate budget cuts was made by Nano Brooks, a newly elected Assembly member who received strong support from people favoring the tax-cut measures. He said the election results show voters favor spending reductions by the city.
"So I think looking at something, even if it's small and supplemental for the remainder of the year, should be worth considering," he said.
A motion by Mayor Beth Weldon not to make any broad service reductions was unanimously approved with an amendment by Deputy Mayor Greg Smith that states city staff can consider targeted cuts "such as new programs or projects."
• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.
