News from Patrick Flynn

Bonds, many bonds

The Assembly meeting on Tuesday, February 3, will include the first major fiscal discussion of the calendar year when we take up eight bond proposals which, if approved by the Assembly, will appear on the ballot for our April 7 election.  Here’s a quick summary of the bond proposals:

  1. School construction: This $69.9 million bond would pay for reconstruction of Service High School ($66.7 M), a needed water and sewer extension at Eagle River High School ($2.5 M) and Girdwood K-8 School design ($680 k).  The State of Alaska would fund 60% – 70% of the debt service for this bond (subject to annual legislative appropriation).  This bond, as well as the next one, has already been approved by the Anchorage School Board.
  2. Major school maintenance:  This $27.5 million bond would fund roof replacements, electrical projects and other major maintenance/upgrades at schools throughout the Municipality of Anchorage.  Similar to the first bond, the State of Alaska would fund 70% of the debt service for this bond (subject to annual legislative appropriation).
  3. Roads: Technically referred to as the Anchorage Roads & Drainage Service Area bond, this $43.9 million proposal would fund road projects throughout Anchorage.  There’s a catch to this one – if your home isn’t in ARDSA but instead is in one of the many Limited Road Service Areas within the Municipality of Anchorage (e.g. most of the Hillside) your property taxes don’t pay any of the debt service on this bond.  On the flip side, those outside ARDSA have to fund their road improvements on their own.
  4. Parks: $2.9 million to fund improvements to athletic fields, neighborhood parks, Delaney Park (the Park Strip), Far North Bicentennial Park, Goose Lake Park, Margaret Eagan Sullivan Park (Westchester Lagoon) and Ruth Arcand Park.
  5. Facilities: A $4.5 million bond to get started on replacing the Public Health building at 9th & L Street (most likely in a new location), upgrade Loussac Library, and re-establish a downtown library.
  6. Public Safety & Transportation: This $1.55 million proposal would replace cardiac equipment for the Fire Department, fund a new ambulance at the Sand Lake Fire Station and provide the local match for federal public transit dollars.
  7. Police: Cramped quarters at APD‘s HQ means a need to expand that facility, which would use half of this $4 million bond (lots of state capital money is expected as well).  The other half is aimed at a new Southcentral Law Enforcement Tactical Range (a firing range that allows for tactical maneuvers, since the one at Fort Richardson is less and less available for civilian use).
  8. Fire: $1.8 million to fund renovations at the Eagle River, Airport Heights and Spenard fire stations, and to replace the Eagle River ladder truck that caught fire (insert wry comment here).

As we deliberate on these bonds one consideration is the financial health of our community.  Here’s some debt numbers that inform the discussion:

  • Current municipal debt: $1.25 billion
  • Existing voter authorized but unissued debt: $72.4 million
  • Debt slated for retirement in 2009: $76.5 million
  • Bond propositions under consideration: $155.7 million
  • Total debt if the Assembly and voters approved all the bond proposals: $1.4 billion

While those are pretty big figures Anchorage is pretty healthy financially, hence our AA rating.  So let’s break the numbers down in order to make this more relevant on a personal level (assuming the state continues to reimburse school debt):

  • Current debt per capita: $2,887
  • Dept per capita if all bonds pass and other authorized debt issued: $3,435
  • Annual property tax increase per $100,000 in assessed value: $38.91
  • Annual property tax increase for home assessed at $350,000 (average MOA value): $136.19

Given these impacts, the question for us to consider is whether to place bonds before the voters and, if so, in what amount.  As I discussed in a previous post our options are to place the bonds on the ballot as is and let voters decide what to fund, take a bond holiday and not place any bonds on the ballot or pare back the bond proposals and then place them on the ballot.  Conversations with my colleagues indicate a preference for the latter course of action, which means we face the challenging task of cutting in an equitable manner.  I’ve sent a long list of questions to the administration about various elements in the bonds and the answers will help inform my thinking.  In all, I expect a long evening on Tuesday, and it’ll be tricky to keep everyone moving forward without falling into the trap of parochialism.

Feel free to peruse the bond proposals and let me know what you think should be in or out, and you’re still welcome to participate in my poll on the subject (below).  I look forward to the feedback!



This contribution was made on Saturday, 31. January 2009 at 16:00 and was published under the category Fiscal matters. You can follow comments on this entry through the RSS-Feed.

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1 Comment

  1. Hi Pat ! Thanks for doing all this….it is great !
    I support all public safety, police and fire bonds as they are
    with no deletions. Thank you for your consideration. Karen

    Comment: Karen Cameron – 31. January 2009 @ 7:13 pm

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