Anchorage's property tax cap rises $18.5 million for next year

The most Anchorage can collect in property taxes next year rises to $381.7 million, up $18.5 million from this year, under the city's preliminary calculation of its tax cap. If recent history holds, the city will take nearly all of it: in 2026, it collected everything the cap allowed except $325.

The number comes from a memo Mayor Suzanne LaFrance sent the Assembly this month, which a work session takes up Friday. It's a preliminary figure. Whether the city collects the full amount won't be decided until April, when the Assembly sets tax rates.

The cap isn't a number officials choose. It's a formula, starting with what the city collected the year before and adjusting for population, inflation, new construction, voter-approved measures and debt. Then it subtracts the city's other taxes, on cars, tobacco, rental vehicles and fuel. That last step is the one that matters most to homeowners, and the memo spells out why: "Every dollar increase in revenue in non-property taxes translates into a dollar decrease in property taxes, and vice versa."

This year the vice versa applies. The city projects its non-property tax revenue to fall, in part because of one-time money that won't repeat, and the roughly $3 million decline in the taxes the formula counts is offset, dollar for dollar, by room to raise property taxes instead.

For a sense of scale, the average 2026 tax rate was 8.97 mills, about $897 per $100,000 of assessed value. The city actually levied more than the cap, $393.4 million, because debt payments sit outside it.

The mayor delivers her 2027 budget Oct. 2, with public hearings in October and November and a final Assembly vote Nov. 17. The tax rates themselves get set in April.