Win Gruening: Juneau Assembly spends recklessly despite voter concerns about affordability
- Guest contributor
- Oct 1
- 3 min read
By Win Gruening
In just one night, at the Sept. 22 Assembly meeting, almost $30 million in cash went out the door.
That’s when the Assembly approved moving forward on a new City Hall (twice rejected by voters) with a price tag that could reach $20 million or more. In the same meeting, they refused to reconsider evicting tenants and spending up to $9 million on redevelopment of Telephone Hill even though no plan exists for how that would be accomplished.
Yet, as ballots for Juneau’s Oct. 7 municipal election are being processed, city leaders tell voters that the “stakes couldn’t be higher” and if you vote to make Juneau more affordable, the results “could be catastrophic.”
We’re told that pools, parks, and recreation programs, Eaglecrest, the ice rink, libraries, and the city museum would all be on the chopping block. Some claim the streets won’t be plowed, arts programs will be axed, and our quality of life will suffer.
These assertions that the sky will fall are not borne out by the facts.
The two citizen affordability initiatives placed on the ballot to limit the property tax millage rate to nine mills (slightly above where it was last year) and to exempt food and utilities from sales taxes will hardly put Juneau out of business. A third measure, a seasonal sales tax proposal, is being presented by the city as a way to offset revenue reductions. In reality, however, a seasonal sales tax likely would increase the tax burden for many residents, especially seniors.
Most of the concern is directed at the cap on the property tax millage rate. Opponents insist that city government needs the flexibility to raise the operational mill levy all the way to the current cap of 12 mills. The fact is that in the past 20 years the actual rate has been under 10 mills and last year was under nine mills. There is no need for a 12-mill cap and the currently proposed nine-mill cap would pose no real hardship on city finances today.
More to the point, despite our lower mill rate, property taxes have continued to rise inexorably to fund an ever-higher level of discretionary spending like the demolition of Telephone Hill, a new city hall, and an expensive new arts and culture center.
For example, my real estate tax bill has risen 58% in the past five years and 70% in the last 10 years. This is because tax-assessed values have risen due to inflation. However, these values must be supported by generally accepted appraisal guidelines, and there are safeguards now in place to prevent arbitrary increases in tax assessments.
That’s not the case with the mill rate, which was increased with a simple majority vote of the Assembly this year, even though that increase will fund a budget that arguably doesn’t reflect the wishes of most residents.
Furthermore, the mill rate cap will not restrict the portion of real estate taxes used to service debt. If our elected leaders need to fund a large project to meet a serious need that would otherwise exceed the mill rate cap, that funding can be put on the ballot and passed by a majority of voters. Such funding requests would need to be truly necessary and justified, a novel concept that seems to be absent from a significant portion of spending by our current Assembly.
Assembly members obviously wish to retain the ability to increase our property taxes any time they wish, especially for projects and programs that would never pass muster with voters.
If the city coffers can continue to disgorge millions of dollars for projects no one wants or has asked for, it’s pretty obvious that the cries of alarm by some are nothing more than scare tactics to preserve profligate spending habits. It’s clear that current and future revenues can support services residents actually need.
This is why the stakes couldn’t be higher in this election.
If voters want a more affordable community, they should pass the first two ballot propositions limiting property tax increases and adding a sales tax exemption for food/utilities, while voting against the seasonal sales tax proposal.
• Win Gruening is a former senior vice president in charge of business banking for KeyBank in Alaska. He was born and raised in Juneau, and graduated from the U.S. Air Force Academy in 1970. He is involved in various local and statewide organizations.
