Downtown Juneau is quiet in this March 20, 2020 photo. A City and Borough of Juneau website is tracking changes to businesses caused by COVID-19. (Michael S. Lockett | Juneau Empire)

Downtown Juneau is quiet in this March 20, 2020 photo. A City and Borough of Juneau website is tracking changes to businesses caused by COVID-19. (Michael S. Lockett | Juneau Empire)

Opinion: Our Assembly needs to build a balanced budget

We need to use the present fiscal situation to right size programs and salary scales.

  • By Joe Geldhof
  • Tuesday, April 28, 2020 5:30am
  • Opinion

Win Gruening’s recent column addressing the significant budget deficits facing our community was insightful and contained several prescriptive measures worth adopting. Facing a budget shortfall of roughly $35 million, Gruening argued for prudent measures calculated to build a balanced budget, including reductions in salaries, postponement of some capital projects and targeted reduction in staffing.

The likelihood the current CBJ Assembly will develop a prudent and sustainable budget based on actual revenue and considered needs is, unfortunately, a faint prospect.

[Pick priorities, not winners and losers to plug the budget gap]

Establishment of a budget for Juneau according to actual needs of the citizens and based on realistic revenue projections requires critical analysis and bold action. Unfortunately, the current CBJ Assembly and the existing management team tasked with administering local government lack the skill and the will to propose and adopt a realistic and sustainable budget for Juneau based on actual revenues.

Faced with difficult choices, the existing management will recommend utilizing significant savings to build our next local budget. In addition, the existing management will advocate for a significant tax increase to round out the budget. No one should be surprised if the current management down at City Hall punts on furloughing employees, elimination of positions or cutting executive pay levels.

The Assembly will take their cues from the existing management team, engage in seemingly endless deliberations about budgetary matters and then raise taxes, spend savings and largely elect not to engage in any realignment of service delivery that would yield significant cost savings.

Instead of kicking the fiscal can down the trail by “balancing” the budget via tax increases and spending savings, the CBJ Assembly should direct the city manager to propose reductions in general government operational expenditures for in the sum of $7 million dollars. This hard but necessary task is essential for a genuine discussion to take place before adoption of a sustainable and fair budget for our community.

The first task of any organization faced with financial uncertainty is a comprehensive review of existing expenditures. Such a review will allow critical tasks and essential services to be funded and continue while indicating where possible cuts and consolidation might be warranted. Non-essential services and funds spent for inflated salaries should be examined critically and reduced or eliminated before plugging the projected budget deficit with savings or by increased taxation.

Even a casual review of the existing CBJ budget suggests that some positions currently funded in the CBJ budget need to be eliminated or furloughed. A few obvious examples illustrate this point. Juneau is not going to have a significant cruise ship season. The position of Port Director should be eliminated. The personal costs associated with planning and community development should be pared through furloughs or reductions in salaries. And in order to build a fair and sustainable budget, the CBJ Assembly should reduce salaries for upper echelon managers by 30 percent.

Other reductions in spending are necessary. Discretionary grants awarded by the CBJ Assembly should be suspended for the next year. Consideration of closing sales tax loopholes should be taken up by the Assembly.

No aspect of the existing budget should be above scrutiny during these difficult times. Proposed wage increases, unless contractually mandated, should be eliminated and the proposal to increase the pay of CBJ Assembly members should be discarded.

I am not advocating here to savage the employees of our community who staff our hospital, respond to emergencies, take care of our water and waste infrastructures and other essential services. They deserve our support and should be paid a good working wage and benefits.

But a review of the current budget suggests our community has spent to much on too many programs for decades. Before continuing with unsustainable spending, we need to use the present fiscal situation to right size programs and salary scales in order to build a lasting and vibrant community.

Should we use a portion of our savings to meet the current fiscal shortfall. Yes, but only after we trim existing general government operational expenditures by at least $5 million. Should we raise property taxes? Yes, but only after we right size government, trim discretionary spending and reduce bloated salary scales for select employees.

Building a sustainable and fair city budget will require an “all of the above” approach, starting with cuts and consolidation before spending down our savings and jacking property taxes. As a community, we are in this fiscal problem together. No person or group should be immunized from the adjustments necessary to solve our budget shortfall.

• Joe Geldhof is an attorney who has lived in Juneau since 1979. Columns, My Turns and Letters to the Editor represent the view of the author, not the view of the Juneau Empire.

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