OPENPUBLICA · PUBLIC MEETING RECORD
Record of Proceedings

Assembly Budget and Finance Committee Meeting - September 18, 2025

Assembly & Committee MeetingsThursday, September 18, 2025
BodyAnchorage, Alaska
SessionAssembly & Committee Meetings
DateThursday, September 18, 2025
StatusFILED
Video Record

STREAMING COPY IN PREPARATION — RECORDING AVAILABLE FROM THE ORIGINAL SOURCE

Transcript — Verbatim
0:16

Okay, everyone.

0:17

Why don't we call this meeting to order?

0:19

Um, hopefully folks on the phone can hear us.

0:21

We are recording.

0:22

Um, I will call to order the assembly budget and finance committee of the whole.

0:26

Today is Thursday, September 18th.

0:28

We're noticed from 10 to 11 a.m.

0:30

and we have uh committee meeting after this.

0:32

So we'll keep it uh keep it tight.

0:34

So first we'll do introductions um and then we will move into our business.

0:38

Zach Johnson.

0:39

Daniel Volant.

0:40

Anna Brawley, and on the phone.

0:41

Oh, and also we have uh Miss Baldwin Day walking in.

0:46

Here, I'll skip, you don't have to say on the record.

0:48

Um so on the phone we have uh Chair Constant.

0:53

Here uh Presverdia.

0:57

Yes, here and Member Silvers.

1:01

Yes, here.

1:03

Okay, thank you.

1:03

And if anybody else is on the phone, uh please just give a shout out.

1:06

We also have uh assembly council, um, members of the administration and a couple of our presenters today to give updates uh as well as in the back there.

1:14

So uh let's go ahead and move forward.

1:16

So first we have standing reports and unfinished business, and I will turn it to our budget advisory commission chair, Mr.

1:22

Mills.

1:23

Thank you.

1:24

We had a good meeting last week, uh presentation from Director Browse on the budget calendar where we're at in the budget process.

1:31

The commission is looking at putting together a resolution on the budget, drafting it at our next regular meeting, then maybe having a special meeting to get that finalized uh so it comes out timely.

1:43

Nothing too shocking.

1:45

We are a little bit short on members, so we're looking at encouraging people to apply to join the budget advisory commission.

1:53

If any of you know anybody who'd be interested in joining more the merrier, um happy to take any questions.

2:01

Okay, thank you.

2:02

Questions for Mr.

2:03

Mills.

2:06

And as usual, folks on the phone, just text me if you want to get in the queue.

2:09

Um okay, yeah, I don't think we have questions.

2:11

I guess the one question I do have, I know most of our board seats um expire or or the term ends in October.

2:17

I believe budget advisory commission is June.

2:20

Is that correct?

2:20

Okay, yeah.

2:23

Yeah, so for folks out there, if you'd like to join, um, there's some seats uh and opportunities to get engaged.

2:29

So with that, I think we'll move on.

2:31

Thank you for uh being here.

2:32

So next we'll go to the MOA trust fund update, and we have our uh board chair, Mr.

2:37

Slifka.

2:38

So go ahead.

2:38

Uh thank you through the chair.

2:40

So just as a reminder, it's been two years since the fiduciary board has been impaneled.

2:45

So want to share a few things over the trailing three years through June.

2:50

Uh the fund has had a return of 9.4%.

2:53

Um while that lags the benchmark by a little bit, it exceeds the inflation plus four percent, which is really your whole goal to maintain purchasing power and pay out the four percent dividend by over 200 basis points.

3:08

So it's been a good couple of years.

3:10

Having said that, returns over 9% are should not be expected every year.

3:17

Um even though this year as well has been going fairly well at the end of August, the fund had a value of 467 million.

3:27

Um, should things not change that much from here, and I've communicated that with the OMB, uh, the payout to the MOA next year should go up, could go up by 400,000.

3:40

Um, so a total of 16.9 this year it was 16.5.

3:45

Um we are in the process of accepting applicants for our director of uh investment operations.

3:53

We hope to have that done in the next few months.

3:56

Um we have an item that's gonna come before you, I think in the next meeting or two.

4:01

We have done an RFP for a consultant, and so we have chosen the new firm, and so we are gonna be asking your approval uh for that contract.

Discussion Breakdown — Share of Meeting
Fund Balance██████████████████████22%
Budget Equity Analysis████████████████████20%
Short Term Rentals████████████████████20%
Fiscal Sustainability████████████████16%
Municipal Assistance█████5%
Procedural████4%
Affordable Housing████4%
Contractual Audits███3%
Personnel Matters███3%
Summary of Proceedings

Assembly Budget and Finance Committee of the Whole Meeting - September 18, 2025

The Assembly Budget and Finance Committee of the Whole met on Thursday, September 18, 2025, from 10:00 to 11:05 a.m. The committee received updates from the Budget Advisory Commission, the MOA Trust Fund, and administration on revenue and budget to actuals, discussed fund balance implications of the 2023 ACFR, and heard a presentation on a proposed short-term rental tax. No formal votes were taken.

Budget Advisory Commission Update

  • Chair Mills reported the commission is drafting a resolution on the budget, aiming to finalize it at a special meeting for timely submission. They are short on members and encouraged applications.

MOA Trust Fund Update

  • Mr. Slifka reported the fund achieved a 9.4% trailing three-year return through June 2025, exceeding the inflation+4% target by over 200 basis points. Fund value at end of August was $467 million. The expected payout to MOA next year may increase by $400,000 to $16.9 million (from $16.5 million).
  • The board is hiring a director of investment operations (applications due September 19). An RFP for a consultant selected Callan; the contract (item 11B on the September 23 agenda) requires assembly approval.
  • Discussion: Member Constant noted Callan’s bid was roughly double the lowest bidder and requested a memorandum explaining the value differential and minority opinion before the vote. The board agreed to provide that by Tuesday, September 23, or Constant would move to postpone.
  • Ms. Baldwin Day asked about applicant numbers for the director position; the hiring process is ongoing and not yet public.

OMB Director Revenue and Budget-to-Actuals Update

  • The budget-to-actuals report was delayed due to technical issues. Through 66% of the fiscal year, the municipality spent 58% of the budget; some debt service entries will bring that closer to 66%.
  • FEMA and ARPA closeout is progressing; ARPA projects expected to finish by year-end. The ML&P closeout communication regarding the Golden Lion requirement is expected in October.
  • Revenue Report (presented by Mr. Cipriano):
    • Property tax collected at 99.7% of the $351 million budget ($349.9 million collected). The 0.3% shortfall ($1.06 million) requires further detail.
    • Route tax down ~17% from 2024 record of $45.7 million; third quarter expected to be largest but slightly down.
    • Motor fuel excise tax rate is 11.5 cents per gallon. At member Constant’s request, staff will provide a projection of revenue from an increase matching the Mat-Su Borough’s 10-cent increase.
    • Building safety at 102.6% of projection partly due to a prior mill rate increase in the building safety service area.
    • Cash pool earnings negative $1.4 million due to market valuation; a recent Fed rate cut may improve returns.
    • APD counterfines lagging but considered de minimis; PFD garnishments are collected through court referrals.
    • Municipal assistance from the state (historically up to $4 million) depends on annual legislative appropriation and submission of the ACFR.

Fund Balance Presentation

  • Mr. Falsey explained the “10 and 2” fund balance policy: 10% of current year expenditures for major funds plus 2% working capital reserve. The 2023 ACFR shows unassigned fund balance of negative $51 million, meaning no spendable fund balance and non-compliance with the policy.
  • Historical context: the 2019 earthquake and COVID drew down reserves deeply; by 2023 the balance recovered to the working capital level (2%) but still shows a deficit. FEMA reimbursements received after the ACFR close were not fully transferred; if corrected, 2023 would have been close to compliant.
  • Deficits in the Building Safety Service Area and IT fund affect the roll-up. The administration is analyzing how these should be represented.
  • The 2024 closeout (expected March 2026) may show a surplus due to vacancy savings and FEMA receipts, potentially creating a positive spendable fund balance.

Short-Term Rental Tax Proposal

  • Mr. Volan and Mr. Constant presented a proposed charter amendment (AO 2025-?) to impose an additional 5% tax on short-term rentals (STRs) on top of the existing 12% room tax, with revenues dedicated to housing and associated infrastructure. Exemptions for owner-occupied properties are under consideration.
  • A complementary registration project (requiring STRs to register and provide unit-specific data) is being developed to address compliance gaps – third-party booking platforms have not provided per-property tax data as required by existing code.
  • Discussion: Sponsors stated the tax is intended to generate resources to offset neighborhood impacts, not to punish STRs. Member Silvers asked about evidence of STR-to-long-term rental conversion in other jurisdictions; data was not available. Ms. Baldwin Day requested revenue estimates (requested just before adjournment) and clarified where the housing fund would be established – it does not currently exist and would require a follow-up ordinance if the charter amendment passes.
  • No vote taken. A public hearing is scheduled for the September 23, 2025 assembly meeting. Sponsors may introduce an amended version before then.

Key Outcomes

  • No formal votes were held.
  • The MOA Trust Fund board will provide a written cost-differential memo regarding the Callan contract by September 23, or the item will be postponed.
  • The administration will provide a revenue estimate for a motor fuel excise tax increase.
  • Detailed budget-to-actual review deferred to a future meeting due to document distribution timing.
  • The committee acknowledged that no spendable fund balance is available from the 2023 ACFR; the 2024 ACFR is expected to inform future budget decisions.
  • The short-term rental tax proposal will proceed to public hearing on September 23, with potential amendments.

Meeting Transcript

Okay, everyone. Why don't we call this meeting to order? Um, hopefully folks on the phone can hear us. We are recording. Um, I will call to order the assembly budget and finance committee of the whole. Today is Thursday, September 18th. We're noticed from 10 to 11 a.m. and we have uh committee meeting after this. So we'll keep it uh keep it tight. So first we'll do introductions um and then we will move into our business. Zach Johnson. Daniel Volant. Anna Brawley, and on the phone. Oh, and also we have uh Miss Baldwin Day walking in. Here, I'll skip, you don't have to say on the record. Um so on the phone we have uh Chair Constant. Here uh Presverdia. Yes, here and Member Silvers. Yes, here. Okay, thank you. And if anybody else is on the phone, uh please just give a shout out. We also have uh assembly council, um, members of the administration and a couple of our presenters today to give updates uh as well as in the back there. So uh let's go ahead and move forward. So first we have standing reports and unfinished business, and I will turn it to our budget advisory commission chair, Mr. Mills. Thank you. We had a good meeting last week, uh presentation from Director Browse on the budget calendar where we're at in the budget process. The commission is looking at putting together a resolution on the budget, drafting it at our next regular meeting, then maybe having a special meeting to get that finalized uh so it comes out timely. Nothing too shocking. We are a little bit short on members, so we're looking at encouraging people to apply to join the budget advisory commission. If any of you know anybody who'd be interested in joining more the merrier, um happy to take any questions. Okay, thank you. Questions for Mr. Mills. And as usual, folks on the phone, just text me if you want to get in the queue. Um okay, yeah, I don't think we have questions. I guess the one question I do have, I know most of our board seats um expire or or the term ends in October. I believe budget advisory commission is June. Is that correct? Okay, yeah. Yeah, so for folks out there, if you'd like to join, um, there's some seats uh and opportunities to get engaged. So with that, I think we'll move on. Thank you for uh being here. So next we'll go to the MOA trust fund update, and we have our uh board chair, Mr. Slifka. So go ahead. Uh thank you through the chair. So just as a reminder, it's been two years since the fiduciary board has been impaneled. So want to share a few things over the trailing three years through June. Uh the fund has had a return of 9.4%.

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