Borough begins budget process on wary note

Jan 10, 2019

The Kenai Peninsula Borough began its budget process Wednesday, with managers and directors meeting to discuss departmental finances. At the borough assembly meeting Tuesday night, Mayor Charlie Pierce warned that there are some complications going into this budget cycle.

For one thing, he doesn’t expect any extra help from the state.

“What would you think if you were sitting preparing a budget, would you think you’re going to get extra revenue from the state or do you think you’re going to get less revenue from the state with the position the state’s in?” Pierce said. “My guess would be they’re going to lean more of the things that they’ve been paying for, they’re going to push them back to local level, which will require us to pay more as we go.”

Another complication — the borough is responsible for the upkeep of school facilities. The borough is still trying to figure out how to come up with the local match requirement to build a new school in Kachemak Selo, to use to the $10 million the state has allocated for the project. Voters already rejected a request that the borough take out bonds for the local match. Pierce says that bonds are looking even less attractive in the future.

“We’ve seen the reports and the announcements that they plan to raise interest rates two more times in 2019,” Pierce said. “So if the borough plans to do any bonding — we’ve got a school district with 50-year-old schools that are looking for bonds, they want to float a bond. And it’s something we should consider in regards to some of the deferred maintenance that we have.”

The borough also begins negotiations with its employees' union this week. Pierce says he is hopeful for an expeditious process that results in a win-win for both sides.

Carrie Henson, of Soldotna, spoke during public comments. She’s the secretary of the Kenai Borough Employees Association and also a frequent detractor of the assembly’s previous policy that limited who could give an invocation at the start of assembly meetings. Henson was pleased to see Tuesday’s invocation receive a respectful welcome and says she hopes for the same in negotiations.

“It appears we all have evolved on this issue, and I hope that that is sustained as we move through this year of diverse invocations,” Henson said. “My hope is that this open-mindedness will also spill over into the upcoming budget process and union negotiations so that it will proceed much smoother than last year.”

A secular invocation was given by Kalliste Edeen, of Homer, to start the meeting.