On Wednesday night, the City and Borough of Juneau’s Finance Committee took action to shore up the city’s financial picture by deferring about $2.5 million in debt service to 2023 and requiring the airport to use federal relief funds to cover its debt service.
Because the state decided to reimburse 42% of school bond debt–rather than the 50% CBJ expected — the debt service fund had a shortage. City officials planned to plug the shortfall with money from the general fund.
However, because of CBJ’s rapidly declining overall debt service, the city can lapse the fund and defer this payment to next year.
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According to Jeff Rogers, CBJ finance director, the move will allow the CBJ Assembly to keep the debt service mill rate flat at 1.20 into fiscal year 2023, which begins July 1. In addition, the move means that money from the general fund that would have been transferred to shore up the debt service fund can stay put and be used for other priorities.
The committee also agreed to instruct the Juneau International Airport board to pay general obligation debt with federal funds rather than use city money for the next two fiscal years. Rogers said that move will spare the city’s general fund about $1.3 million over that timeframe.
• Contact reporter Dana Zigmund at dana.zigmund@juneauempire.com or 907-308-4891.
