Flat mill rate, sales tax included in Kenai budget proposal

Kenai Finance Director Terry Eubank, left, and Kenai City Manager Paul Ostrander present during a budget work session on Saturday, May 14, 2022, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)

Kenai Finance Director Terry Eubank, left, and Kenai City Manager Paul Ostrander current throughout a finances work session on Saturday, May 14, 2022, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)

A flat mill price and gross sales tax, increased charges on the Kenai Animal Shelter and cash for quite a few capital initiatives are all parts of the City of Kenai’s proposed finances for the upcoming fiscal yr.

Kenai City Council members, metropolis directors and division heads convened Saturday for an all-day finances work session, the place the proposed finances for fiscal yr 2023 was offered. Fiscal yr 2023 begins on July 1, 2022, and can finish on June 30, 2023.

Kenai City Manager Paul Ostrander described the City of Kenai as having a “COVID hangover” within the type of excessive inflation and a giant enhance in metropolis income. He stated it’s frequent for governments to develop once they get extra money, however that it’s more durable for governments to shrink again down when cash goes away. To stay sustainable, Ostrander stated capital initiatives are usually reduce and or taxes are raised.

“This budget doesn’t do that,” Ostrander stated. “It doesn’t grow the government. It really positions the city for success now and going forward into the future.”

Outlined within the proposed finances’s assertion function are the objectives of town finances, which Kenai Finance Director Terry Eubank learn aloud Saturday.

“Meeting the needs and priorities of the community means prioritizing essential services while being mindful that non essential services such as parks and recreation, arts, library and senior services have significant importance to a vibrant, well balanced community in which individuals have a desire to live,” the proposed finances says.

Included within the proposed finances are value of dwelling changes for metropolis workers and a bump in month-to-month well being care premium prices for metropolis workers. The metropolis can also be in yr three of shifting the fee share price: Kenai is working to maneuver from a 90-10 value share to an 85-15 value share. This yr, metropolis workers’ share is 13%, whereas town’s share is 87%.

No adjustments are proposed to Kenai’s gross sales tax or property tax, additionally referred to as the mill price.

About half of town’s normal fund income for the upcoming fiscal yr is predicted to come back from gross sales tax, whereas one other quarter from property tax. In all, Kenai is projecting normal fund revenues of $18.6 million in fiscal yr 2023, together with about $9.3 million in gross sales tax income and about $4.2 million in property taxes income. The metropolis’s gross sales tax income has steadily elevated over the earlier 5 fiscal years, with one other venture improve in FY23.

Kenai metropolis council member James Baisden proposed that town decrease the mill price as a “symbolic” message to residents that they’re benefiting from town’s bump in income. Because the rise in income comes from federal grant applications, Baisden stated the cash actually comes from Kenai taxpayers and that they deserve to profit from the enhance.

Eubank knowledgeable council members that reducing the mill price by .1 mills would save a resident about $25 per yr in a pattern situation the place a resident’s property is valued at $250,000.

Mill charges are used to determine how a lot somebody can pay in property taxes throughout a sure fiscal yr. To calculate how a lot property tax they count on to pay, a person should divide the mill price by 1,000 after which multiply that by their property’s taxable worth.

Included within the proposed finances are will increase in parking charges on the Kenai Municipal Airport: Daily charges would improve from $7 to $8, whereas annual charges would improve from $700 to $800. In all, there’s about $3.15 million price of capital enhancements deliberate for the airport throughout the upcoming fiscal yr. About $450,000 of that cash would come from town’s airport fund, whereas the remaining would come from non-city sources, akin to grant applications.

Residents would additionally pay extra for animal management providers by way of the proposed finances. Nonresidents can be charged double the charges for residents. Soldotna residents would pay the identical as Kenai residents due to an present animal management settlement between the 2 cities.

Under the adjustments, Kenai and Soldotna residents can be charged the identical quantity to drop off felines as they’re to drop off canines: $20.40 for cats and canines, and $35.70 for kittens and puppies. People adopting animals from town shelter would additionally pay $15.30 — as a substitute of $10.20 — to microchip the animal being adopted.

The proposed finances additionally funds town’s contributions to capital initiatives described in Kenai’s five-year capital enchancment plan for the upcoming fiscal yr. Among others, the plan describes about $1.4 million in metropolis General Fund contributions to initiatives, akin to $420,000 for the rehabilitation of Willow Street and nearly $400,000 for repairs to Lilac Street.

Kenai additionally plans this yr to place $1.5 million towards the development of a water therapy pump home, which can replace distribution pumps within the metropolis’s water system, $150,000 towards the set up of safety cameras on the Kenai Municipal Airport Terminal and $120,000 towards the substitute of shelters and dugouts on the metropolis softball discipline.

Kenai City Council members can have the choice to amend the finances earlier than it’s authorised. The finances as initially offered might be up for introduction on the council’s Wednesday assembly. If authorised for introduction, council members would have the choice to approve the finances on the following assembly on June 1.

A full copy of the draft finances might be discovered on town’s finance division web page at kenai.metropolis.

Reach reporter Ashlyn O’Hara at

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