Anchorage Assembly: Worksession re General Government Operating & Capital

Okay everyone, I think we're ready to get started. Um, so, uh, it is 11:05. We are noticed, uh, this is going to be a long work session today. So we are discussing the FY 2027 proposed budget. Um, so we're going to be— this is the first of two work sessions.

We have a presentation as well as members have their budget books before us, and so we'll be working through that. And then we have— I'll just say also we have our second work session So what we don't cover today will be covered next Friday, the 23rd. And then the plan, I know Miss Brause will speak to it in a little bit, but generally I just wanna give folks, actually before we do that, let's do introductions. Starting in the room, Mr. Martinez. George Martinez.

Kameron Perez-Verdia. Erin Baldwin Day. Donald Handeland. Jared Goecker. Sydney Scout.

Daniel Volland. Anna Brawley. And that's folks in the room, and I see Member Johnson.

I'm here. Okay, a little quiet, but we heard you. And then, uh, Ms. Silvers?

Here. Thank you. Thanks. Any other members on the phone?

Okay, then we will proceed. So as I was saying, just quickly for timing, and then we'll get into it. Um, so we have— we're noticed today from 11 to 4. Uh, those who have been in this room for this before know that we generally do use that full time. So I'll also just say, uh, we will have a couple times for breaks, but generally if members need to step out, you know, make a phone call, bio break, whatever, just please feel free to do that because we'll just be moving through.

I will manage the queue. In terms of timing, the general plan today, which I know the admin folks will cover in more detail, is we will be starting with our broad overview. So kind of the big picture, what the proposed budget is, those changes, the 6-year fiscal plan. We'll go until about 12:30 for that. I'll keep an eye on time It's a little hard to manage timing sometimes, but we'll get through as much as we can there.

We will break for lunch. Lunch is provided for folks who are in the room, and then we'll be coming back before 1:00, probably a little— not too long of a break for lunch, and then we'll get into enterprise and utilities budgets. So the directors from those utilities will be here from about 1:00 to 2:00, and then the remainder of the time we will get into the capital budget, which includes multiple departments' capital requests. But looking at it holistically. And then we may start into some of the smaller departments, but I think a lot of the kind of department-level overview we are aiming for next week.

So just for timing for that. So a lot of the, for example, major departments like Fire Department, we're going to be covering next Friday, not today, for anyone listening. So with that, I'm going to turn it to— oh, and I should have also said, sorry, jumped right into it. Also in the room, we have Clerk's Office, members of the administration who will be speaking in a moment. No members of the public right now.

So with that, I'm going to turn first to Ms. Fleek-Green for some intro remarks on behalf of the mayor, and then we'll move to the OMB director after that. Thanks. Great. Good morning, everyone. Best time of the year.

Look at this, another budget cycle. The mayor is not available today, so I'll just very briefly touch on some things that you heard in the 120-day memo work session as well. But Challenging times, as always, for our municipal budget, but our OMB director and other senior management have worked really hard over the last 5 months trying to get a handle on what the future holds for us. And we still were able to fill gaps this year so that it is less painful, but those pain points are coming and the mayor wanted to go through scenario planning to understand if we are facing a very large gap next year, how we would address that. Obviously, cuts are one route to that.

Other revenue is another route, and we will have many more conversations about that. For—. But for right now, we bring to you really a continuation budget, a continuation budget that costs more, though. Because everything costs more these days. So you will see how that goes department by department.

But overall, though, the mayor is optimistic about where our community is going, and we have a lot of good things coming. You saw that described in the 120-day memo. Plus, we just have a different landscape coming at the state level, and we don't know what that brings, but it could be opportunities with a new administration that thinks differently about community assistance funding and other programs that maybe could restore local jurisdictions to where we used to be in sharing state revenues. And certainly right now there are more state revenues given the oil— sustained high oil prices, which is affecting our families here in Alaska. But is affecting our state budget.

So that is something that we will be looking to, to help address some of the challenges that we have. And then of course, Jay Bear, Fighter Town recapitalization, gas line, what does this mean for growth in Anchorage in the coming years and how do we ensure that our municipal government is built in a way that we can provide the services that residents expect and also address the growth that we think is coming. So with that, I will turn it over to Director Brause. I will mention that we also have Mr. Bob Doehl here who will be available to answer questions for departments under his wing. Okay, thank you.

Yeah, and I'll just note, as usual, text me or flag me down if you wanna be in the queue, and otherwise we'll just keep going and we'll take questions as they come up. Thanks. Go ahead, Ms. Brause. Thank you, Madam Chair and Ms. Fleek-Green. Hello, everybody.

Ona Brause, Director of the Office of Management and Budget. Thank you for being here today for our 2027 proposed budget. We'll be talking about it for the next 6 weeks at a minimum. So this, I think, will be slightly different than our presentations have been in the past, mostly because of the structure of it. And we can dive into that as we go through some of the sort of setup But as the chair said, we'll be going through the general government overview, which is where we go through about 20 slides of the high-level financial information, the changes in and out of general government, what the property tax adjustments are, and financing sources and uses, et cetera.

We'll also be talking through the 6-year fiscal program, which I don't think is traditionally discussed during these conversations, but does exist in the budget every single year. We're particularly highlighting it, one, because it isn't talked about that frequently, but two, because the key assumptions within the six-year fiscal plan, I think, are important to this conversation and the projections that we're making about what the deficits may be. So that will be slightly different. As the Chair mentioned, we are also sort of presenting differently. Normally, we present the general government budget as operating and capital together.

But because they are different revenue sources, different mechanisms, if you will, we wanted to sort of present them as discrete totals because they are leveraged differently, if you will. We have an operating budget that is set specifically and limited by the tax cap and the revenues available. The capital budget and the bonds associated are recurring questions every year for voters to approve. The reality of those two are constrained in different ways. So we are separating the general government capital from the operating conversation, which will come with the conversation around what do the cuts look like from Department X, Y, and Z?

What would the impact to the community be for those service levels, etc.? We have a lunch break between 12:30 and 1. We have the utilities and enterprises coming in. That is traditional, but they are normally done on the second day of the work session. And then we have have the capital budget with the departments.

They will be present and next steps for the next meeting. If there is any question at any time that I don't have the answer to or that any of our directors who will be available today don't have an answer to, we have people from my department online tracking all of the questions that are asked. And if we are not able to answer it in the room, we will write up a response and get it to you so that you know what the answer to those questions are.

Any questions on that? Mr. Perez-Verdia. I just want to really understand what you just said. I'm— maybe I'm not tracking it very well. You said we're separating the operating budget, obviously, from the capital budget.

We're doing operating budget today, is that correct? We're doing the operating budget review. The department review is next week. Okay, so you're separating the department review from the operating budget, which is traditionally done together. Correct.

And so the word operating, can you— what do you mean? What do you mean? So what do you mean that's the difference between our operating budget and our department budget? What is the operating budget as opposed to it?

When we get through this, so the first 20 slides are just the overview of the total budget, not the departmental. I see, it's just not broken down. Correct. I see. Correct.

And so all of the individual department conversations I see. Right. Okay. So you're not actually separating them out. You're just reviewing them in a different way.

Correct. We're doing the overview so that you have all of that content information of the total budget and then the department review next week. Gotcha. Thank you. Yeah.

And that would— the department view is kind of the parade of directors that we have come and answer questions. So that was—. We wanted to make sure those folks were available. Yep. Okay.

So this year is the same as our traditional year. Uh, with the, the annual budget process, we have, um, both our capital and operating budgets as discussed, uh, that have separate development timelines and several separate development processes. So, uh, when we start our capital budget process, we start the year before the active budget year with community council surveys, then the departments going through the development of the capital improvement budget and what comes forward to the mayor for conversation and decisions for 120-day memo and the proposed budget. And then the present— the budget is presented to the assembly for amendments and approval. We then move into the end-of-year process, depending on whether you are talking about the capital budget or the operating budget.

In capital world, Once we have gone through the approved process, we have to go through bond packaging in January before we get to the ballot in April. Once the election in April is held and the ballot questions are approved, they are then rolled into the budget for that year. And any legislative action that has occurred with legislative state grants in the first quarter of the year are also rolled into our capital budget and appropriated if they are to be spent that year or to the next year. The operating budget, once we clear the revised process for the budget year in April, we start developing the next year's budget. So in April of '27, we will start developing the '28 budget with all of the current information rolling it forward.

Any questions on that?

Okay. The 2027 budget was proposed with the mayor's priorities of good government, safe Anchorage, and building our future. We've talked about these before. Good government is the premise that our local government should be providing quality municipal services, and safe Anchorage for safe streets and trails. Building Our Future is the economic development priority pillar that brings us to a lot of our recreation economy, our Jay Bear expansion, housing development, et cetera.

Under all of those pillars, the priorities that align go with continue to build a strong local government with reliable services, robust public safety, Increased housing development and modernized infrastructure. It's a real challenge, modernized infrastructure, in a lot of our arenas. Strengthening the municipality's recreation economy, revitalizing and reenergizing neighborhoods, common sense solutions for energy resilience and affordability. We'll be talking about energy efficiency projects and specifically some facility proposals for the capital program. That really lean into the demand for that energy efficiency that we need right now in the community.

And preparing for growth, the community changes that Ms. Fleek-Green referred to are part of our priority pillars and recognition because it's a lot of work to prepare for growth when we have been having conversations that potentially are managed decline. So there very different options. Any questions on that? The overall budget highlights— uh, oh, was there a question? Overall budget highlights, uh, the continued investment in street maintenance.

Um, we'll talk through some of that with the department next week, but it will be mentioned throughout the overview slides, um, some of the Key adjustments that were made this year were the inclusion of 7 heavy equipment operators at street maintenance, and along with that, a reduction of the contractual services that were added to supplement the vacant positions in street maintenance was reduced. So there is a, an effort towards investing in our in-house capacity because we can really work it more efficiently when we are staffed to the levels that the community expects. Supporting existing public safety efforts and infrastructure, that is both continuing to establish a, a recurring position for the MIT and some of the other MCT, sorry, and some of the other operational changes that have already happened within AFD and APD, but also to encourage the conversation and propose increases within the AFD in particular due to stations and service demand around emergency medical services, but also to continue to expand other public safety needs that the community is requesting, uh, tackling the housing crisis, invigorating Anchorage public spaces, and funding crisis care outreach and connections to housing. This does not mean only municipal dollars when we say that. The, the funding of crisis care outreach and connections to housing is a multi-layered effort and is general government dollars, alcohol tax dollars, federal dollars, state dollars, private dollars.

And last budget cycle, we had a presentation on the Safe Anchorage budget that included all of those threads so the whole picture of the work that was being done is visible, and that will be presented at the next work session for the budget. Question from Mr. Volland, and I'll also note we were joined in the room by Member Park at about 11:18. Thanks. I'm really interested in number 3, tackle the housing crisis, and how some of our policy change or policy choices impact the budget. For instance, we've had a lot of conversation around proposed abatements.

We did the multifamily A+ units. We have another item that's coming before us soon on mixed-use tax incentives, adding residential to commercial. And I guess I'm wondering when we evaluate those trade-offs, you know, there's, I guess the thinking is, well, If we do those abatements, those units are more likely to get built and therefore be added to the tax rolls in future, you know, X amount of time. Maybe they wouldn't be built otherwise, I don't know. But then also, you know, potentially then in those years that we're doing the incentive, how much money are we not collecting?

What is that doing to our budget during those years? And also just interested, more broadly in what that looks like. How do we use our budget as a tool to tackle the housing crisis? Maybe that is continuing the work that we've done on vacant and abandoned deteriorated property, funding code enforcement, code abatement to be able to do that work. But yeah, just interested in how we can really examine the trade-offs in our budget, but also use our budget to do exactly that.

Yeah, go ahead. I can jump in and then also Nolan Klouda is here who can come speak, but I, I think that's a really good point, right? That abatement or incentive is really capital when we don't have hard cash to be able to bring to the table to try and juice housing development. What we can bring that is capital is tax incentives that all of you have adopted, and we are definitely starting to see that work, drive around town and you see construction happening in places where it has not happened for decades. So, you know, the mayor mentioned this at the lunch and applaud the Assembly for working on this about how that abatement is helping.

But that is definitely a question that we get. And I think just more education is needed so that people understand when we are doing abatement, we are still collecting, right? So we're collecting on the land value of that. And then yes, there is— when the abatement time period comes to an end, there is more housing value there that will be taxed. So the achievement, the golden ring, is postponed, but at least it is coming, which we know that for years it has been stagnant.

So you see things starting to turn, so there's that benefit. So, and then to your second piece in terms of the budget, I think like last year, Member Baldwin Day added some money in for relocation that we are applying so that for when properties are being redeveloped and people need to be relocated to somewhere else, that we have some money over at the Health Department that can be used to help with that. But certainly Like if we, if we had more room to maneuver with under the cap, like where would we invest? Yes, I think there's a lot of places we would love to invest where our municipal services do help create that housing, but we don't have the funds right now. But I think it's a really good question.

And Nolan, if you want to add anything. Sure. Through the chair, Nolan Klouda, Mayor's Office. To Member Volland, I would say something really important about tax abatements when you're talking about the fiscal impacts of them is that especially when we're talking about the multifamily tax incentive, it is incentivizing a type of construction that we really didn't see happening for 20 years in Anchorage. And, you know, in terms of market rate multifamily, you know, non-federally subsidized, non-LITEC types of projects, we really did not see those getting built outside of a few edge cases.

The fact that we're seeing some of them built now, I think with that tax abatement is evidence that they really wouldn't have been getting built without that. And so they wouldn't have been paying taxes if they weren't built. We're only giving a tax break on something that wasn't going to be built, and so we're, we're, what, we're, we're not giving up any revenue that we would have otherwise collected. So I think that's always an important distinction to make, and it's not, it's not bringing up anyone's taxes, and it's not costing the municipality any money. We're forgoing revenue on something that otherwise wouldn't have been built in most cases.

Yeah, and one thing to add to that's important that I think can get lost in the discussion is with the tax cap basically shifts, even if it's in a very nominal way like a penny to everybody else. And so it's not that if we forego, if we say this property is not paying taxes on this building, it's not that ours goes down. The budget doesn't go down $300,000 or whatever the, I guess, way less than that. But yeah, but it's— the scale is so small that it's not really—. Anyway, sorry.

So, okay, any other questions while we're paused? Okay, I think we can continue.

Okay, well, I think we just talked about this one. So community development economic indicators. So good job, everybody. But, you know, low unemployment rate, the new housing permits. This slide is dated.

I think the new housing permits since this slide was produced have increased even more.

We need that on the record. I was going to say Director Doehl said 449 housing units.

Hi, Bob Doehl, Director of Community and Economic Development. As we sit here today, that we have in the system on our housing dashboard is 449 residential units. Compared to 401 last year, and then that includes 266 multifamily housing units, up from 161 last year, and, and last year was much higher than the year before. So on both of those, we're headed in the right direction.

Ms. Baldwin Day. Yeah, thank you. How many of those 266 are, um, are attributable to the senior housing developments that we have.

Through the Chair, Bob Doehl, Director of Community Economic Development. Over 200 of those are the senior housing development at Touchmark that they indicated, but for this, the abatement option would not have gone forward. Excellent, thank you.

We've talked about this for a few years now. All of this is preparation for the conversation where having right now. It is a sort of ongoing conversation about what are the solutions that can come forward in the current moment with the information that we know. To Vice Chair Volland's point, what are the trade-offs when we're making some of these choices? When we are talking about structural changes, either through revenue or through operational adjustments, cuts, if you will, there are trade-offs in all government choices.

There are very rarely choices that we get to make that do not include a tradeoff. And understanding what those tradeoffs, what they mean to us today, very important. But it's also very important what they mean to us tomorrow, 5 years, 10 years, and 15 years from now, because some of the things we are grappling with today occurred because of choices that were made 10 and 15 years ago, specifically to solve problems that were in the moment But there was not a future conversation about what does this mean for next year or 5 years or 10 years, because the ability to project and foresee some of that content is frankly not possible at the municipality because of our staffing capacity. We have spent so much time cutting back departments and the positions from the work that was originally designed to come from those departments because of the financial limitations. And the year-over-year nature of the municipal business, meaning we have executive management that changes, elected officials that change, that turnover creates an inefficiency— apologies— because we are constantly changing the leadership and dynamic of what this process is.

And that is good because we want the community involved in this conversation. But it is slow. And so we have to be able to make really smart choices. That may mean getting better data, which means spending money on it. And that is part of this tradeoff conversation across the board.

If we know we need something to help us do something, then we have to put the right investment behind it. And there's going to be a tradeoff because we won't be investing in something else that is also needed. We are short on revenue, not on need.

The $15 million gap that we've talked about for the '27 budget was closed by eliminating vacant funded positions as part of the position adjustments that we'll go through in the AM support. You'll see that the chief administrative officer was deleted. He is now the municipal manager, but also the entire Chief Administrative Office organization was restructured into other departments. So some of those positions moved around. The Deputy Treasurer position was deleted.

Two positions from Traffic Engineering were pushed onto bond funding, project funding, if you will, because they were only proportionally funded out of the operating budget, and it's appropriate for them to carry with the project work. LaFrance, there are, I think, 1 or 2 other vacant funded positions that were reduced. And an AIM will come to the Assembly either laid on the table on Tuesday or through a different distribution with the other vacant unfunded or vacant funded positions. The good news is there are only a few of them, and the information behind them will help the Assembly understand through their process what's possible. Question for Mr. Handeland.

Yeah, so of the $15 million, how much of that was with those vacant positions? Almost $1 million. Okay, $1 million on this. And then I'm kind of looking out to, I mean, 2028 here. What is, I guess, the anticipated kind of budget gap?

We're looking at $15 million this year. What's the next one? Through the chair to Member Handeland. Hang on. Yeah, I think that's probably where we're starting with.

I could skip the next 2 bullets and go right to that if you want. We, we, it's $15 to $30 million projected for the '28 budget, and when we get to the 6-year fiscal overview, we'll talk through the assumptions in that and why there is a range between $15 and $30 million and how that reflects compared to the '27 gap. I think that's on a few slides. I'll let you get to that slide and then I might have some more questions. Yeah, of course.

I believe you will. And Ms. Park, did you have a question? Thank you, Chair. Is it overly optimistic to think that there might be additional funds coming from the state? Through the chair to Member Park, it's not overly optimistic.

That happens every year. There, I think the reality is we don't know what will come and that is the real challenge. Is that we can't budget it right now, meaning we can't build a program on that funding. So we try to preserve anything that we know is a one-time problem to go with the one-time money. So that's how we think about it anyway.

And Mr. Volland. Yeah, thank you. And I guess I would also just maybe add on a little bit of response to Member Park's question. I think, you know, this is— This is us setting the budget. This is not the end of the story, though.

The end of the story is first quarter budget revisions. That's when we'll know a lot more about what additional money we will receive or not. And so to me, this whole process is like setting your family's grocery budget. You think you know what you're going to bring in and how much you have to spend, but later down the road, if you get a promotion or a raise or there's more money in the, in the couch cushions, then you can spend that later. But we, I think we the responsible part of this is making sure we don't overshoot or rely on something that may not come through.

My comment was, I love this graphic on the right. Clearly graphic design is someone's passion, and I just want to see this little guy. I want him to have a name, and I want to see him in more presentations. Through the chair to Member Volland, so do I. We did discuss whether we should animate him for this slide and decided to be more conservative.

Thanks, Ms. Baldwin Day. And then I'll also say in general, if there is a question that is asked that is covered on a subsequent slide, I think that's an acceptable answer too. But go ahead, Ms. Baldwin Day. Yeah, thank you. I think this is actually addressed on the next slide, but I think I'm curious if we have a number attached to it, and that is how much of the $15 million gap that we are currently experiencing is attributable to specifically the rising cost of healthcare?

Through the Chair to Member Baldwin Day, it's hard to isolate it to say that that number is responsible for the gap, right, because it's all a cumulative total, but I can tell you what the rising cost of healthcare costs us, and the medical increase for general government, I believe, was between $4 and $6 million this year, and that's just the additional money that we have to pay for the medical coverage on the employer side. Yeah, that's exactly what I was looking for. Thank you.

Uh, the, uh, the other, uh, budget gap closure mechanism, reducing reliance on contractual services. As I mentioned before, um, the Assembly had taken action to approve additional heavy equipment operators, uh, in-kind. We reduced the contractual services that— or the revenue, I should— the funding for the contractual services on snow removal. Uh, part of this is the sort of return to a post-vacancy street maintenance budget, meaning the non-labor side of street maintenance's budget was enhanced and increased during the period where they were experiencing deep vacancies, specifically to supplement the capacity or lack of capacity within the department. And now that the department is staffed and we have added positions to increase plow or decreased plowout times, we felt that it was appropriate to reduce the contractual services.

As we've talked about, snow removal is a two-budget process, and one season affects two budgets. So there's a blessing and a curse there sometimes. But to Member Park's question, if there was a demand or need for additional revenue, particularly around snow removal, for contractual services because of the weather, we have the opportunity to do the same thing we did this year, which is appropriate lapse funding from the department into the next quarter, or any state funding or one-time funding that is known or becomes available between the budget process and the revised process in April can be added if that is necessary. And the other answer to how we close the gap is that we relied on one-time funds that are now gone. This has been part of the budget for the last many years, but this year is the last year of the MLNP sale fund, which is not proceeds from the sale of MLNP.

It is basically a parent account that the municipality has and has been paying PERS-related debt and other debt from MLNP down through the budget over the last few years. I think maybe it was first used in '21 or '22. This past year, I think we used $5 million, and for proposed for 2027 is another $5.5 million plus the interest that has been borne from that account while it has lived since the sale of ML&P, which is an additional $3.3 million. So this is more of the same sort of category of scraping the couch cushions and also trying to delete funds from our required monitoring and ACFR process. If we have single funds with $12 in it, we still have to spend the same amount of time managing it through the ACFR process that we do something that has millions of dollars in it.

So if they're— that's part of our good government OMB process that we've been working through in the last few years. I think the budget 2 years ago had Lots of that. Thanks. I have myself in the queue very briefly on the snowplowing point that I missed Park, and I think Ms. Baldwin Day.

So on the snowplowing point, I just, for context, because I was not here the whole time, but I was here for part of that time, I remember multiple points during the winter of 2023-24 where essentially we, you know, in a very short order, we needed to approve a contract to keep increasing that amount because we weren't meeting we didn't have the people in the positions, and so we needed to increase that contractual amount. So I will say, as somebody who was there, I kind of lost track really of how much was put into that account, and it was really trying to address that issue that we didn't have the people, and so we had to contract it out. We had a lot of discussion about how we could pay for priority service when everybody else already had contracts, etc. And so, so just to say it really clearly, I think there was in that particular line item a fair amount of contract bloat, and it was trying to address an issue, which is we need to plow our roads. But I just want to be clear that I think, um, uh, that, that we, we kind of knew at the time that, that, that account had gotten healthy to the point that it was probably too much, right?

But it was trying to solve that issue. So anyway, I'm glad that we are trading out staff positions for that contract and reducing that contract bloat. Thanks. And to the Chair, one of the reasons that did not happen earlier is because we wanted to stabilize the department, make sure that the vacancies were you know, full and that we would be able to operate safely and not have to spend money on the contractual side. So there's a transition period where if you have increased one because another is having operational challenges, you can't just immediately decrease this one and increase this.

You have to monitor it and balance it out. Otherwise, you're going to create more stress and tension on the system, and that is not something that street maintenance needed. Thanks, Ms. Park. Thank you, Chair. Excuse me.

So two-part question, and I kind of don't like this question, but it looks like you were able to successfully consolidate, for instance, the administration under Mr. Falsey. Was that—. That was done without any layoffs, correct? Through the chair to Member Park, yes, the reorg of the chief administrative officer, I believe, aside from the layoff of the chief administrative officer.

But no, I don't, I don't believe there were no layoffs as a part of that. And one of the slides we'll get to later is the position summary and the changes between the budget, and we'll explain each one of them. Some of them look like they are, but they are reorganization into other departments. So I want to make sure that that is clear, because there are some other position reductions and changes that occurred in departmental activity of this budget of reorganization within the department for efficiencies themselves. So the second part of the question is whether we anticipate having to lay off any staff.

At this time, no. Okay, Ms. Baldwin Day. Thank you. My question is pertaining to the MLNP sale fund. So am I understanding correctly that funds remain in that fund?

No, we have zeroed that bad boy out. Through the Chair, this year would be the last year. The appropriate— so on AM support on your general government operating AO 123, 2026-123, you'll see in the source, the revenue sources, that there's a line item for MLNP sale, and I believe it's—. I can pull it up. It's 8 and change.

But the intent is to remove the principal and interest from the fund to stop maintaining the fund, and it would leave nothing in there to budget awareness, current. Okay, perfect. Thank you.

Okay, yeah, and just reference—. She was referencing there's the budget books and then there's the various ordinances and resolutions that were introduced at our meeting on October 6th, and those are the items that we actually amend with all of this stuff being the detail attached to it. And then as we're looking at it, why don't we move to the next slide because I know some of the kind of The intent is to dig more into some of these questions as well. So we'll get there. So challenges ahead.

The outlook for 2028, as mentioned, the projected budget gap is $15 to $30 million. We will get into the details on those numbers in the fiscal plan chart. Costs continue to increase, as Member Baldwin Day mentioned, healthcare, labor, the cost of energy and fuel. We have significantly less state funding than we have had, and we will show some charts on that as well. Decreasing alcohol and marijuana tax revenue, overall decreasing, but we do see a slight rebound on the marijuana tax for this current proposal.

I believe there's an additional $200,000 or $300,000 that Treasury is projecting to be available. And, and the slide says no one-time funds left. There are minimal one-time funds left. There are always one-time funds at the municipality, but the bulk large one-time funds are not known or available at this point in time, and the funding that has been used over the last few years, as mentioned, from the MLNP account is gone.

Mr. Handeland. So I guess my question with this is, I mean, as we're looking ahead and beyond just one budget cycle with this, I guess, what is the plan for this $15 to $30 million kind of looming fiscal cliff that we're at right now? Because I guess in my view on it is, hey, if we're looking at that, we're filling the gap with one-time funding. Is this something where we should be taking one-time funding and splitting that up over a number of years rather than sitting there saying like, hey, let's all front-load it and that's next budget's problem? Through the chair to Member Handeland, to be frank, that's what we have been doing with the MLNP funding is there was a large amount of funding available at one time.

It could have all been taken at once. But because we started talking about this fiscal reality years ago, we have been planning this process knowing how much time is this going to take to get us through, what conversations can we have with the added realities of how any new revenues would or could come on. Some of them can be immediate. You get voter approval on revenue mechanism X, maybe the next day it is turned on. If you try to establish a new revenue mechanism, there's a certain amount of time that it's going to take, like sales tax, to go through all of that.

But there is trade-off in all of that. We have all of these other activities happening. And so this whole conversation is Where are the pinch points and how far can we make this to get the community to engage to tell us what they want to see happen? We are talking about structural changes that would probably completely delete programs that the community currently engages in. And we need the time to have this conversation.

This table, these meetings are where we have the decisions about Are we going to spend it all now? Are we going to spend it tomorrow? How are we spending this? What's available? So it's this conversation where you make those choices.

And if I can, through the chair, go ahead, jump in. Suzanne Fleek-Green. I think you will see in a bit here too, and the mayor talked about it when she delivered the budget again, she asked for some scenario planning by departments to understand what what a cut would look like, what services residents lose. So we'll be talking about that too. But again, those are making sure that the public has transparency and daylight into the choices in front of us.

And it's, I mean, sure, cuts could come. Let's talk about what those cuts mean on the ground in terms of services delivered and remembering that our biggest budget drivers for the municipal budget are APD, AFD, maintenance and operations, things that people firmly expect a local government to be able to deliver. So again, choices and how we make sure that the public is engaged in that conversation well before we get to this point for 2028. And through the Chair, I will say, to reiterate, those pieces of information, that conversation around the departmental changes, operations, that's what we talk about in the work session next week. So all of what Ms. Fleek-Green just said in terms of the scenario planning, the Mayor's Office, as our budget guidance this year, requested that the departments submit a flat budget proposal, which means that they figure out how to accommodate any contractual increases that they know they are going to have to afford by adjusting or cutting their budget.

We also asked them to propose a budget with a 5% cut scenario to their direct costs. This means that if you have a department that is all contractual commitments— real estate, venues, etc.— you can't cut those budgets. They are set by the contract for some period of time. There are only certain kinds of cuts that we can take or make in an immediate process, And the difference between a flat budget and a 5% cut is $30 million. So the wiggle room that we need is in that space.

The question then becomes, what are the departments saying they can do, they can afford, they could manage without breaking? And what we will see when we talk through this next week, but what we also already know is that there is not much that can be given up without breaking. And so whole programs will need to be ended instead of breaking lots of programs. And that means that full choices will be made about ending something as opposed to just managing the decline.

Any other questions?

Mr. Bowman, and then Mr. Perez-Verdia.

So that did spark a new question for me too. So that $30 million delta, do we have an idea of how that would impact someone's property tax bill? Through the chair, yes. Just you wait. Okay, lovely.

Great, because I can't imagine it would be all that substantial. But, um, shoot, what was my original question? Oh, my question was, okay, so we have been hearing, Sydney and I, from our downtown constituents— I think I mentioned this to you already— strong support for continuing the downtown foot patrols. And that has been something that we received funding from elsewhere and we were able to spend it in that way. I guess I'm wondering, you know, When we think about the limitations of our continuation budget and the tax cap, are we gonna be looking at doing any sort of special levy in this cycle?

We had the proposed one to support the school district last year that did not pass, but we've also had levies pass, such as the one to upgrade our snow removal fleet. Is that a tool that we are considering? Through the Chair, there is a tool similar to that, and there is always the conversation open for how would we create funding to do X, Y, or Z, and special levies are the way that you would do that in our current universe. Outside of a borrowing process like bonding, if you want a recurring total amount coming in, the special levy is the way you do it. Great.

I think, you know, I've also heard in that conversation around bringing it back to the downtown foot patrols, other representatives from other districts say, hey, you know, we'd like something like that in our neighborhood that is experiencing some of these public safety issues. So I don't know, I'm just kind of, I guess, throwing this out into the ether, maybe like a public safety special levy. I don't know. And so through the chair to Member Volland, I will say that downtown District is saying that they want this, they like this. I believe many other districts are saying the same thing, and that would mean that we should increase the police service area, not a specific foot patrol area.

And we can do that. The way that we would do that is by putting forward a special levy or a tax cap increase specifically to accommodate growth within the police service area. Of we want to add $15 million to accommodate overtime and/or staffing to achieve XYZ. This is how we're going to do it. And that voter-approved action then increases the amount of money you're allowed to collect under the cap for the police service area and the work that they do within it.

No. Okay, yeah, and I'll remind folks too, I know we're going to have a deep dive on each of the departments and then we'll get to the capital, but this is not the same as capital. But so next, Ms. Baldwin Day, because I want to— I just want to make sure we can get through these slides. So the reason that I'm asking is because, you know, the bonds are a little bit, as I understand it, that could be— I'm willing to be corrected, but more constrained to capital, whereas a special levy can you have more flexibility with operations, maintenance, planning efforts, that kind of stuff. Through the chair to Member Volland, now I will say yes to Mr. Falsey's question, which is there is— we'll have that conversation around the capital budget because there is this— there is, I think, a practice that the municipality has been in for the most part where our bond packages come with the capital investment for financing on the bond, as well as a small O&M increment that goes for the maintenance of whatever that new asset is when it goes into service.

That has traditionally not carried the full loaded cost of maintaining or operating that asset or those assets, depending on what they are, because of the nature of the municipality. That is a completely reasonable, normal national thing that happens in other places. The, the, the fire service levy would be $250 million and you would get this, this, this, this, this. That is a service level budget. You tell us what you want us to provide.

We tell you how much it costs. We then do it if you say that's good, go do it. Right now, the tax cap sits over that fund, all of those individual funds, those 6 that we talked about, and holds them here. If we want to change them, just ask the question, can we change this service area this way and allow it to exist under the tax cap? So this is the police service area.

Here's the tax cap. We want to go like this. Okay, do you want more funding to go for this thing? Great. That, that is a normal ballot question that has happened at the municipality in the past.

We have reset tax caps in order to accommodate specific adjustments. If the ASD question had been a recurring levy, it would have permanently increased the tax cap by up to $12 million and given that additional space to the district. Space to flex.

So the other alternative is, should we increase the tax cap by $20 million?

Okay, next I have Mr. Perez-Verdia, then Ms. Baldwin-Day, then Ms. Park. Thanks. I just want to name something that will help me as we're having these conversations that I think can be confusing, and I'm not sure this is helpful or not, but the terminology we're using. You're talking about programs versus services versus initiatives versus projects.

And I think when you said that, you know, we have to decide whether a program goes or stays as opposed to breaking things, what it tells me is that there is a, there is a belief system that there are core services that are not programs, that are not initiatives, that are just what we have to do versus a project or a program, that sort of thing. So as best we can define those, it would be really helpful, I think, for this conversation, because it would tell us what you believe is a core service and what you believe is a program or a project, so that we could have a better conversation around that. So that's, I think, that's one piece when someone says my constituents like this project or program or service versus my constituents like, you know, police to show up when a crime is committed, right? And so, so that may be helpful. I don't know if you have those differentiated already, but it would help me in terms of understanding the conversation.

And through the chair to Member Perez-Verdia, the reason I'm smiling is because we want you to tell us those things too, right? We, that's why we're talking to the community, is what does the community think are the core programs and services that they want us to provide? There are things that we legally have to provide and things that are expected for us to provide. But those are not the same things. And the expectations are what get in the way of us having a practical conversation about what we can afford versus what we expect.

And this is not about what we think is the core service. It's about the information that we can gather and respond to. And so we need you to engage and tell us what those core services are. We can hear a lot of the sound of some of those core services. But we know that there are other core services that when they are endangered become primary to the effort.

And we need to understand what that looks like and have a long enough conversation about deleting something if we are going to have to delete something so that people understand why it's happening and that it is not just an arbitrary choice to get to a bottom line, because we want to understand how we are actually impacting the community demands while we are in a potential growth stage. It is a very sort of fluid situation. Yeah, no, I agree with that. And I just, as a follow-up, just, I think naming the why I'm calling it this or why I'm calling it that, I think is really important because I think in that conversation, there is an assumption, at least for me, that that piece we're talking about right now is a project, and it could come and go without taking away what I would consider to be core social services. It's really nice to have, but it may not be essential, but we may not all agree on that.

So I—. Through the chair, I can't agree more, and I think we'll do some shameless promotion and say that, you know, we're doing an event at the end of the month with in coordination with the Assembly that is about this conversation. It's about what are those trade-offs so that the community can understand that we can't provide services in a 24-hour cycle immediately on demand because of the funding levels, but also because within reason it's not appropriate. We're not— we can't solve every problem in the structure that we are in as a municipal service area model.

Thanks, thanks, Miss Baldwin Day, then Miss Park, then Mr. Handeland. Yeah, I just wanted to throw a reminder on the table that as long as we have a tax cap formula that says that every cut is permanent and the budget ratchets down like year over year, having this discussion about where we cut costs and making deeper cuts starts to become a like self-perpetuating cycle. And so there is a structural question at play here, I believe, about this ratchet-down mechanism. When we are living in this kind of fiscal environment where we would maybe like to make some different choices, we have to understand that the choices we make to cut now are choices that echo in perpetuity unless and until we change the tax cap formula.

So reminding us that that is also a factor at play. And through the chair to Member Baldwin Day, I would say that if you look back through the history of the municipality, we are— we are— this cycle is repeated over and over and over again, at a minimum on an every 10 to 15 year cycle, but in real drastic ways on a 15 to 20 year cycle. And those things obviously can change based on the inputs. But this conversation, a $10 million gap, a $15 million gap, a $20 million gap has happened in 1993 and 2007 and all multiple times, right? And, and the way it is discussed is either we know there's a solution, we figure out there's one-time funds to put in there and we don't have to do it, or the budget proposal is This is a huge emergency and we have a problem.

And we know that is the structure of our business. We have been planning this conversation directly and plainly while recovering the municipality because we know this is the conversation we have to have. And engaging to understand what the core services that we're required to provide versus what the community expects us to provide versus what they want us to provide and pay for are very different questions, and understanding all of that takes time and engagement.

Thanks. Next, Ms. Park, then Mr. Handeland. Thank you, Chair. I don't see anything before us regarding ASD, and I'm wondering whether there would be a likelihood there could be a levy expressly, as you mentioned, for APD, that we can do that? Through the chair to member Park, that's possible at any time given the sort of nature of how we work through the questions that we have.

As long as the question comes or the proposal comes before January, if it were going to be on the ballot, it's possible. We will be talking about ASD. Part of the conversation that we have to have around the operating budget and the inputs to the operating budget and the timing around these cut choices and funding choices, they all dovetail together and they are all a matter of timing and what are the options for each of these solutions. The—. We've talked about this, I think, in the ASD joint meetings and in other areas.

The timing of the decisions around the school district budget and the municipal budget are not in complete alignment, but they do allow for interplay back and forth. We're in conversations with ASD about their '28 projection, and we believe that they can revise some of their numbers, and we'll be talking about them, talking to that, talking with them about that. But we believe that the '28 projection is resolvable, and the '27 projection, we are waiting to see how we get through the rest of the conversations with them. And the state activity that is occurring through the next election and legislative session. Thank you.

Thanks. Yeah, and just to be clear, pretty much nothing in this book or the other books talks about ASD directly because there's a whole separate process, but it does, it certainly relates. Correct. Mr. Handeland. Thank you.

So you mentioned previously about some like contracts that we've already obligated and how that those are, I guess, difficult to make cuts to. Aren't those still subject to legislative approval?

Through the Chair, when the contracts are approved originally, yes. Do you maybe want to give an example, some examples of what you mean? I guess what you mean? Like collective bargaining agreements or contracts, like what are, when we say contractual, what does That mean? I'm sorry, say the question again.

Sorry, so I'm saying that like we are approving the contracts, but then we go and we still approve a budget. And so my question is, isn't this— those contracts still have some kind of clause or provision in it that they are still subject to our legislative budget approval for them? Through the chair, I don't know if there are clauses in them, but yes, it is all subject to the approval of revenue by this body. Okay, I think Mr. Bowman wants to respond as well, but I think—.

I mean, just to dig in though, I think when you say contractual, there's service contracts, right? But there's also collective bargaining contracts, which are labor contracts, right? So the question is, can you change all of them in the same way? Yes, I think that's, that's a very good clarification. Thank you, Chair.

Uh, the— there— when we say contractual services, there are the professional services that are contracted outside of the municipality, and then the contract, the collective bargaining agreements that are contractual that we have to deal with in very different ways, right? This is a vendor contract and this is a labor negotiation agreement and how they can be adjusted. Because 60% or close to 60% of our cost is labor, the bulk of large contractual changes on the labor side have to come with renegotiations. The others are subject to appropriation and available funding. And if there is no available funding, then we have to go back and either negotiate or break the contract, which would come with probably a service reduction of some kind because the contracts are providing services.

Thanks. And then I think Mr. Bowman wanted to respond as well.

And I was going to talk not on the labor contracts because those are a whole different beast, but on our general municipal services contracts, for a given service, we do include in those a provision that says subject to appropriation by the Assembly, which means that if the dollars that support that contract are not appropriated, that contract can be broken. But that doesn't mean we still get the services. It just means that contract goes away and the whole contract is gone. Okay, thanks. Yeah, I just want to make it clear because, yeah, I was making sure that we were not having— we are approving contracts or something and essentially binding a future assembly.

Every assembly still has to pass a budget and has the ultimate appropriating authority. Thanks.

Next, Mr. Martinez. Thank you, Chair. Let's go back for educational clarification purposes to the conversation around the foot patrol special levy, paying for things.

And I'm thinking of— and then the nature of— it was suggested like other areas like interested in that and how we would potentially pay for it. So that raised the question about the business improvement district for me. Downtown has a business improvement district, and I wonder if we know just off the top today or if we can find that out. I know we can find it out, but How much, how much is collected in the Business Improvement District?

And it seemed like that should be part of an analysis about the cost, especially the difference between that area and other areas that do not have for security potential purposes to support that and maintenance purposes. And I wonder about the overlap of those dollars there and what's replicatable, in fact. I believe that the analysis could theoretically be done off of those numbers. We don't have it available right now, but we can absolutely get them. Excellent.

And it just raises the— it raises a question that I think— I don't think aggressively at all, but it has kind of lingered for me, which is when we were talking about increasing foot patrol downtown, who pays for what? And, you know, even when it comes to a special levy, a special levy is citywide for like increasing APD patrol downtown. Through the chair, a special levy is how you said it. So if it's within a specific service area, it doesn't need to be area-wide, but it depends.

Oh, just for clarification, downtown is a special service area? I'm saying you can make a service area. Okay, that's right. You, you can create, you can create a service area for which the levy pays for the service to be provided. And so a special levy can be applied in any service area.

And then that would be the, the, the success or failure of the resolution would be as a result of the voters in that particular correct service area, which is newly crafted? Correct. Okay, well, that's interesting because it just does raise the question about who pays for what. And there are other jurisdictions that, um, what Nashville, for example, pays for its downtown police and night police straight from the business improvement district and outside funding sources. And it really covers the overtime and the additional stuff because they are regular hired police officers.

It's not special. That's right. That's the service level they would like to pay for. And so that is a service level budget. And just to parallel, like, Other areas don't have— there's only one business improvement district in the municipality of Anchorage.

Correct. Right. In the whole state. And so it's an interesting— it's an interesting place to think about that, and especially as you think about the— not only there in terms of who pays for what and how to kind of have sustainability built in, but also the other areas. And I will always constantly juxtapose another commercial corridor like Muldoon and specifically describe the difference between the residential density of Muldoon and the residential density of the corridor of where foot patrol is in fact happening and the difference between the populations that are being served.

And so I think even when people on the East Side are saying, hey, we want foot patrol, It's a different relationship to quality of life daily than, you know, going downtown, for example, and having that kind of downtown experience in a safe way. So I just wanted to flag that as we think about these questions. Thank you. And I would love that information gathered. Through the chair, Suzanne Fleek-Green.

Mr. Falsey just told me that the annual downtown partnership. It's about $1.1 million a year. I believe the assembly just took it up last meeting. Um, and yes, that's the only one. There's been on and off attempts to create something like that in Midtown, has not gotten very far.

I don't know if other parts of Anchorage really has— have talked about that at all, replicating that. Um, of course, they do not— here in Anchorage do not serve that kind of law enforcement role or supporting. And I don't think our bid does either, just to finish that. Exactly. Yeah.

But safety is part of at least the charter of that. Right. And it just gives us an opportunity to discuss it potentially in another way. And I would flag that the Downtown Partnership came to the last or two CDC meetings ago and presented as well. And so we know that there's a limited budget with what they do, but that raises the question about what that particular item could be.

Could it be raised? Could be changed? And could it be more targeted as another mechanism to pay for sustainable investments of this type downtown? Yeah, and I think I will just state the obvious, that foot patrol is a subset of patrol, and we still struggle to fully fund any shift patrol across the municipality. And if we are able to get APD to the numbers where we are able to have full patrol numbers, then how we take care of a downtown foot patrol in that scenario would be a whole different conversation.

But we are still very active. You hear about this every month, actively trying to expand our force, and we have been successful in the last 2 years to do that. But probably the, the number, the goal number is larger than what we have been talking about within our current budget constraints. So yes, other options for how we fund that is very welcome. And I think when we have APD here to talk about their budget in more depth, which will be next Friday, that would be a very good conversation to have with the chief.

Okay, next I have— okay, now let's go, Mr. Bowman. Yeah, so I'm gonna— I'm emailing Molly right now to see if you can circulate that item from the 6th that we did approve, which was the Downtown Improvement District. $1.1 Million is accurate, and also in the memo is a list of what can be funded. The Downtown Improvement District can be currently used to fund security but not law enforcement, but there's a list of what that money goes toward.

Okay, Miss Keller. Yeah, and I appreciate the opening up of this conversation because my understanding is that the security that the Anchorage Downtown Partnership used to provide the demands were too high for what they were able to hire people to do. And so that was sort of the genesis of the downtown foot patrol. So I think this does open up an interesting conversation about who pays and where we have that style of policing, and I look forward to having that conversation in the future.

Thanks. Yeah, and then I'll just note for the record, just looked it up. So Mr. Volland stated the The total assessment for the Downtown Improvement District is about $1.1 or $1.2 million. The total that was approved for the police overtime for those patrols was $650,000. So just for scale, that's a 50% increase.

So again, we always have to talk about scale. But with that, let's—. And I think just for the record, remind everyone that came out of the newly negotiated Tourism Improvement Project funding. I think I have that acronym correct. Yeah, the bed tax or room rental tax.

So, okay, so let's continue with the high level. And then I'll also say too, I know a lot of when we're talking about this, it'll trigger a lot of very specific questions about departments, all those other things. So I would say write those down and then we're going to get to them either in the capital budget or when we get to the deep dive, because we'll also have department directors who can directly answer questions as well. So just a preview for that. So go ahead, Miss Park.

Thank you. To double down on what the chair just said, it is 12:20 and we are on slide 11 of— well, the overview is 21 pages, so we can book through some of this, I think.

This is the operating budget summary information, so this is included in the book and has been— is in your assembly documentation, the operating AO, etc. The total appropriation for the '27 proposed budget is $692.5 million. The property tax cap is $383 million. The budget is proposed at $34,000 under the cap. The departmental share of the budget is on the right-hand side of the slide, and that is a pretty standard and traditional percentage split for the municipality.

We have had some movement around the maintenance and operations and debt service line items. They usually go between 3 and 4 in the last couple of years, but for the most part, everything else is relatively the same in our continuation budget. The key funding source changes are the non-property taxes decreased by 3.3%. Why is that significant? Because under the tax cap, if the non-property taxes decrease, property tax— unless cuts are sustained, the tax cap is one bucket of funding and the total means that the total is for all of them.

If one of those can increase, but the property taxes are set by the actual cap itself and the multiplier in it, the other bucket. And/or any ordinances that may be enacted to the totals that we take. So we lost $3.3 million in non-property taxes, transfers from other funds. You see in 2026 revised, we had $29 million of transfers from other funds, and this year it is $37 million. I think it was during the 120-day work session where a member asked specifically about the transfers— yeah, Member Scout— from other funds being a reduction.

It is the nature of continuation budgeting when we remove the one-time funds, which are transfers from other funds, depending on where the revenue is coming from, or may not go back in when the budget is proposed. And so some of the gap was coming through the transfers from other funds. Fines and forfeitures is up by $100,000. The property tax increase, the total property, not under the cap. This is the cap plus service areas and special levies.

The total property tax increase is $19.8 million. And to your point, Member Volland, the next slide will tell us what the equates to.

Program revenues up $100,000, investments in other special assessments up $2.4 million, revenues from other governments flat, and that in things like TORAs and SEMT revenue reimbursements. And so these are either contracts that were that we don't know how they will change yet, or revenues that we don't know how they would change.

Okay, go ahead.

Miss Coleman-Day. Thank you. So, CMT, am I correct that what we are anticipating in CMT program fees for is actually SCMT revenue from 2024 because that is the ACFR we just completed? Through the chair to Member Baldwin Day, no.

Okay, to me. The 2024 SCMT revenue— and I'm going to potentially use inaccurate, but this is the structure of it— the 2024 SCMT revenue would have been budgeted in 2025. The—. Our delayed ACFR is— means that revenue didn't exist in that year. And so when we receive it, depending on which rules, it either goes back into be received of that year or it is held in current year in the previous year that we accrue in other funds like property taxes when we get people who pay us property taxes that are, you know, due from back property.

We get that money in the year 2026, but it could be from 2022, but it's held in a prior year. So it's separate but still goes into the budget. SEMT is budgeted at a total amount that we received from— how do I explain this— amount for SEMT stands at the blended rate of the actuals that we have received. So we do not adjust the SEMT budget until the FTE tells us that we are going to get more of it.

So, so How does that square—. Because we have to have— it was my understanding that we had to have our ACFFER completed on it in order to be able to go back and say, thank you, we would like our SE/MT program funding now. Correct. Okay, so in a, like, theoretical situation where we complete 2 ACFRs in a given fiscal year. How does the SEMT accounting look for that?

Are we—. Are—. Through the Chair to Member Baldwin Day, answering this question very well, through the Chair to Member Baldwin Day, one, we should actually ask the accounting department to be the respondent to this question, uh, and two, I think we can— of how this actually works because When we set the revenue source in the year, we are still banking on receiving it. If we know we are— is coming, it is projected, stays there. When we think we are not going to get funding, we are going to lose the SEMT revenue from the state because our ACFA is not done.

That is when— because $20 million that was already budgeted and spent doesn't come through. But that has not happened. We have been able to meet the requirements for the SEMT funding budgeted every single year so far, and any revenue that comes in from SEMT, the budgeted amount, then gets appropriated by the Assembly to go do fire department activities of X, Y, and Z. We just haven't received any SEMT funds the last 8 or 10 months because of the way the Act First split came across. It's, it's— if is the question, are you worried we're not going to have money?

No, my question is if we have bonus dollars, I'm going to call them that. I mean, I know it's not actually like— so we wrap the 2024 ACFA, we say, okay, we would like our SCMT funding. And also, by the way, we also did our 2025, so can we also have that funding back? Like, then when we have $20 million plus $20 million through the chair, the same thing happens when we get any new one-time money. We come to you in one-time money that was not budgeted originally because it's over and above the budget.

Apologies for that terrible answer. So this is what we're budgeting now, is this is what we know is going to come through the door? Correct. And other things are a question mark pending completion of 25 ACFR? Correct.

Got it, thank you.

Okay, where am I? Mr. Handeland. So on this, this is not all of our funding sources because I just totaled up the $27 budget and it's $28 million, that's less than our total appropriation on it. No, this is the key funding source changes. Not—.

So I guess, I mean, we've got almost all of them, so I guess what would not be included in this? Everything on page 6. 2026-123, The AM support is 2 pages long. The AM support lists every change that is being made within the— that would answer those questions. We will go through those details on the AM support when we get through this overview section.

Okay, sorry. Okay. Yeah, and I'll note there's— we haven't gone through and kind of marked in the operating budget book, but there's whole sections on kind of all of our revenue sources, the list of all the funds and their codes. So there is that kind of level of detail. We just don't usually present.

Okay. The preliminary property tax impact with that tax adjustment between 2026 and 2027 proposed is $11 per $100,000. That is an average. It is lead independent service areas that have different layers of service may pay more or less depending on increases are in their specific service area, but that's the average rounded amount.

I have a brief question on this. So as I'm reading this, Essentially, the projection would be the property tax bill goes up 1.2%, is that right? Correct. And is that less or more than what we anticipate inflation to be? Just CPI changes for 2020.

1.2%? Yeah, that is less. Okay, thank you.

The property tax comparison for then and now, we'll see more of these kinds comparisons when we go through the operating departments in how the departments were structured in the past versus how they are structured now, and if there are any changes that are— that teach us anything there. Anchorage in the '80s, the budget gave us about $2,705 per capita, $2,705, and in these we are at about $500 less per capita than we were in the '80s. We have also received about $10 less in state funding than in the prior decade. You've seen some of the charts and graphs of legislative funding, both through the designated grant, the Community Assistance Program, and municipal revenue sharing. But that is a close to billion-dollar deficit that we have been sustaining for the last 10 years.

The—. This is the further breakdown of the percent for the entire budget. You see the top 60% of the municipal budget is maintenance operations and debt service. The rest of the departments are the bulk of the— are the rest of that aside from $3 million of depreciation. That $9.3 million of depreciation has a slightly interesting story when we get to the 6-year fiscal.

It is not a scary story. It's just an interesting one. Any questions on this? I have gotten a lot of questions from constituents about specifically, and I'm wondering if there is a tidy place to direct people who would like to understand exactly what is contained in that 9.6% of the mini-budget. Through the chair, the budget book contains all that information of what's in it, but I think the appropriate place to get the real nitty-gritty on that is—.

Thank you. Yeah, not wanting to direct the general public to go read through the budget book, I would say thanks.

And I have a brief question. Okay, Mr. Falsey. I will say it. I'm just going to try to pull it up, make sure I can reconcile it in real time, but Public Finance Section publishes in the newspaper a single disclosure of all of our general obligation bonds that shows the debt service. I think it's been certainly distinguished between the school district and the municipality.

I bet that would let you see that so much of it is fire, so much of it is police. Let me see if I can push that out. Thanks. And just a brief question. For example, I know this has been brought up before, public transportation.

So the, the numbers that we're looking at here, we should not read this as property tax only, is that correct? So that I know they're unusual, they're mostly federally funded, so the $35 million includes federal funding in that instance, is that correct?

The budget is $701.8 million and the property tax collection is under $400— or including special— $113 million. So it is not all of the revenue included here.

Thanks. So I'm looking ahead. I'm going to suggest we go through slide 8, the organization chart. That seems like a natural break, so we'll get through those slides. We'll still take a brief break for lunch.

We're going to make it a working lunch, but we'll have a time to walk away for a few minutes, get back on the record.

Okay, key direct cost changes. These are the changes within the budget that we go through with our revised and process or for our continuation process, we start with the 2026 revised budget total at the top of the page, $671.1 million, and then go through the one-time reversal, one-time items from the budget, onboard the debt service adjustment with the information we get from public funds, increase the voter-approved debt service that goes along with the continuation budget. Continuation is $14 million. That is an important number because that is the amount of money it takes for us to roll the current operating positions forward into what would be 7 cost of doing business. So that is the labor growth on the side that is around the number that we have seen the last few years on labor continuation, um, and impacts that we'll talk more about in the 6-year fiscal.

Um, the, uh, other adjustments were a $1.1 million to, uh, revenue on room taxes and police fire retirement. Uh, that takes us to $9.8 million total of a continuation budget. Uh, then we go through and make the adjustments for the 2020 And we add in $8.4 million of revenue from the MLNP sale fund. As I mentioned, of the actual principal, and then another interest layer that has accrued since 2021, I believe. An additional $700,000 of voter-approved bond O&M was added.

Uh, 0.8— 800 of, uh, vacant position transfers and reductions, as mentioned. Um, that is also included on the AM support roll rollup, $1.4 million in shelter costs. That is part of the conversation that the Assembly has been having about making sure the SERP expense is covered in the operating budget because it is not accommodated in the alcohol tax. And a $0.1 million reduction in contractual versus labor snow removal, for street maintenance. $1.9 Million in— very interesting, this is $1.9 million of Healthy Spaces revenue, and this is also $1.9 million additions.

So this is the official budget transition from Healthy Spaces being included in the alcohol tax, which you'll see a few things. There are— from the alcohol tax into general government follow the pattern of other pilot programs that exist in the alcohol tax being born and desirable to the community and then going into the operating budget. Healthy Spaces was the conversation last year. The demand for the service was there. We know the alcohol tax revenue is declining.

We know we don't have space in the general government to, to deal with that. Surcharge was added to SWS. This is now the general government receiving that surcharge as the— so this $1.9 million used to not exist in our general government budget, but now we have added $2 million of service non-property tax dollars to the operations in Parks and Rec. The position change detail on the AM support with all of those healthy spaces positions that the assembly Assembly approved to go into the operating budget.

Another alcohol tax, uh, is the early literacy position. The library had a funded position for early literacy operations within the, uh, Child Abuse Sexual Assault Domestic Violence Prevention section of the alcohol tax. The reduction reductions to alcohol tax revenue meant that that position either needed to be reduced and laid off or— general government budget. The library is very in need of that service. We made a way to accommodate it in the general government budget.

Anchorage has an increase that from their board and contractual adjustments for facility leases is about $300,000. That is not the end of contractual adjustments for facility leases. The bulk of those adjustments during the first quarter budget revision because we know how those CPI adjust— those inflators on the contracts actually come up as budget. So that lands us at $701.8 million of a proposed budget with a $692 million appropriate difference between that is the depreciation within IT.

2027 Proposed financing sources: 60% property taxes, 5.1% fees, licenses, and permits. This— that number will vary in a second year pattern. So every other year, the Permit Center has different kinds of certifications that are required, and so you will see a spike in certain fees or permits that change in a year-over-year basis. It is not abnormal. Questions on these?

The proposed budget categories you saw over on the other side, 60% property tax, 60% salaries, and that is not necessarily Necessarily by design. It is the nature of how we like to use recurring and solid revenue. We do not want to put labor and positions on sources because they are not reliable in terms of hiring and retaining a workforce. So we try to maintain recurring fund— recurring needs.

Questions? I do have one quick, quick— this is really a follow-up. I'm curious, so other services, I'm guessing a lot of that, the contract for running various facilities, and I mean, I could name them off, but we know what they are. Is that—. Yeah, through the chair.

Okay, yeah, I would be— as a follow-up, yes, kind of what of that 30% that's there, or the, uh, was it $214 million, um, could I get a breakdown of how many of those are for basically managing a facility? I'm thinking of broad facility, so animal control center, dam, you know, all those, all those ones versus things like, you know, snow hauling or other kind of services. And maybe there's some third category, but I would, I would just love as a follow-up kind of what the breakdown of that is in a broad way and not a granular way.

Because I think realistically a lot of that is actually paying for labor, but it's contracted labor and not Other questions from members?

I know we're a couple, well, almost 2 hours in. I know it's a long, going to be a long day, and it'll be a long day next week. So I guess the question is we could just continue. We're at 12:40. We could power through or we could break for lunch.

I'm seeing a break for lunch. Okay. We need a break. Well, let's briefly break. We'll say, well, we can leave the recording going.

We'll just put it on mute. And then I'd say maybe 10 minutes or so, and then we'll come back at 12:50, and then folks certainly can eat their lunch at the table. That way we'll just do kind of a working lunch and go from there. And I see we have some of our folks starting to show up, so ready for our enterprise utilities folks. Okay, so we'll be back on the record at 12:50. comes back.

And then for folks walking into the room, we're just a few minutes behind. We're still going to get to the enterprising utilities one, so just sit tight. We'll get started in a minute.

Literally just thinking that. Casino. Send this all down to Vegas.

Okay, I think we are back assembled. We're back on the record. Thanks, folks on the phone, for your patience. So we are just finishing up the last few slides in our overview, and then we will be switching over directly to enterprise. And I know we have a number of directors in the back, so we will call those folks up when we're ready.

In the meantime, I believe we are on slide 19 where we left off, correct? Okay. So where we left off, slide 19 with the 2027 organization chart. This is the reorganization that includes dissolving the chief administrative office and redistributing those throughout the municipal manager's column, but mostly retaining them under the chief fiscal officer. Not a new design for the municipality.

The municipal manager now has fire department, health department, police department, human resources, IT, library, parks and rec, public transit, and purchasing, as well as all of the utilities and enterprises that we are about to talk about over there. And economic and community development is now a direct report to the mayor and organized under Director Doehl for Planning, Real Estate, Public Works, Maintenance and Operations, Project Management and Engineering, and Traffic Engineering. The other notable change, the Risk Management Office had traditionally lived, or most of the time lived, with the Municipal Manager's Office Administrative Officer when under that design, but it now is included with the office. So risk management is a division of the municipal attorney's office so that there is good— our risk managers and our legal team.

Any questions on the reorg? Okay.

As a result of the reorg, this is the budgeted positions by department reconciliation summary page. This is in the overview of every budget book. If, if you—. Who's—. I'd say probably 5 pages from the 2,000 pages of budget content that we have.

This is one of the pages that is happening at the municipality within the municipal budget. You can look at the position records, the department direct cost reconciliation, and a couple other pages of information and really see if things are changing in a year-over-year basis, because this slide shows the top chart of the page. The second, the lower half of the page is all of this detailed tiny, tiny font, and this explains every single one of these current year changes and tells you what is happening. Because when you look at this, it looks like, uh, one position was removed from We can talk about that. We've talked with Chair Brawley about it.

That is the result of a non-labor item that moved around. We're having a meeting on Monday because it wasn't supposed to happen. We're trying to align the budgets. And when we go through the labor scrub, sometimes certain things happen and we say, oh, that wasn't supposed to happen. We go back, we talk about it.

So that won't show up in a revised budget or if we are able to accommodate that adjustment. The chief administrative officer shows a decrease of positions. Those 14 positions were not laid off or deleted from the budget except for the chief admin. Those positions were redistributed through the rest of the department, or through the rest of the municipality.

The chief fiscal officer, you see, has 2 positions being added. That is not— those are not new positions. That is the result of dissolving the chief administrative office and recreating the Chief Fiscal Officer office under Chief Administrative Officer. So you go down to the next line. Finance has 3 people removed from it, the 2 people who were added to the Chief Fiscal Officer, but one person— not person, one position that was reduced from Treasury, the Municipal Treasurer position, because it is no longer necessary based on the way their office is structured.

So each one of these to the Health Department. The Health Department has a 6-position reduction. Some of that has to do internally reorged based on their current practices, as well as shifting some of to new or different grant funding. So when Director Rash is here with us, she'll be able— some of those changes are and that they should not result in a service level reduction, but that they are part of a reorganization and/or in order to accommodate other contractual increases within the Health Department. So when we roll all the way down, the net personnel change from '26 to '27 is 6 positions, and the bulk of those 6 positions come from the street maintenance the heavy equipment operators.

It is, uh, it was that were added, but because there was one reduction, it is 6. Uh, overall, the position count between the 2026-27 proposed budget is a 6 PCN change. And I'll just make one clarification. So as, as Ms. Brause stated, uh, the reduction in our budget is actually an error, so not, um, Anyway, we'll have more on that next week, but just to note. So I guess if you take that into account, then the net would be 7, but that is different though.

But again, more on that next week. Ms. Baldwin Day.

Thank you, Chair. So if there is a difference between what is in the position summary table on Roman numeral 2, page 14, and what is in the tabs is—. Which is correct. Show the difference and then maybe I can tell you what this is. And maybe this is what the chair was talking about.

So like Emery, it lists 42 proposed positions in 2027 and On the summary table it shows 37, um, and the summary table shows 334, but in the— I can't alphabetize things, um, but I believe in, in the detail it says 335. Which one, which I think the answer is it depends on which department it is, which is why we have to be specific about— there's a difference between PCNs and FTEs. So, yeah, and I would suggest that the position summary is the easiest way to see what those adjustments are, and the tabs should give you refined information about what that actual adjustment assessment on the PCN versus FTEs is.

Position summary, Roman numeral 2, page 14. Is this, is this FTEs or—. FTEs. Okay, thank you.

And when we get into the utility budget, you'll see specific category on the presentation that that sort of interplay between the positions within the utilities and enterprises, and you'll see that same detail on the government departments next week.

So making sure that I'm clear, so what— so when we get into the tab, PCNs, not FTEs? Yes. Okay. Okay. Is one of the other pages that if you look at what is happening in the municipal budget, this will tell you a lot.

But it will only tell you a lot if you know how to read it. And your fiscal program is in all of our budget books. It is a combination of the budget plus the projected next year's proposed budget and the inputs that then trail in those subsequent years to get us— this is the top of the page in our But the lower half of the page, once again, looks like this. It's a chart and then a lot of tiny, tiny detail underneath it. The tiny detail tells you how to read the chart and what the assumptions on the graph.

We had had questions earlier about what the projection for future out-year deficits are and where— this is the chart where they come from. The 6-year fiscal program at the bottom of the page, you can see in the out— '29, '30, '31, '32. The deficit going from $14.4 million to $19.1 million to $23.4 million, et cetera, et cetera. Those are only the increases associated with the variables and inputs on the page. So we have to understand— assumptions that are included, because there are assumptions that are not included in this chart that do change the reality of what that $14 million might look like.

In '20. So when we look through the detail at the bottom of the 6-year fiscal page, you can start with the line that says the 2026 total budget. That means that it includes everything from the 20— in our current year through September 4th, 2026. That was the time snapshot and set the supplemental spends through 2026. So the total budget for 2026 includes the financing sources for 2026 in the top 10 lines, and then uses underneath that.

So that's how we spend it. The proposed budget detail, everything we have in front of us, is the next column. And get into the turn between '27 and '28, what matters is whether or not there are any different assumptions in any of the So we take overall assumptions for the out years in '28 and further because we don't know variables will change in every subsequent year. So every year we get further away becomes a less reliable prediction, as we know. The overall assumptions for this 6-year fiscal plan include only general government operating no Anchorage School District taxing, and it does not include assumptions on program— other funding sources like grants, like AMATS and HUD and Health Department.

All of those kinds of things, those are not included in the 6-year fiscal. The 2027 proposed is the base for 2028 through 2032. So we start and then continue all the way through the fiscal plan to the 6 year with the same assumptions overall, unless they're noted. The population is incorporated at the Anchorage Economic and Community Development report that was presented, I believe, earlier this year and has been our traditional population number. Right now it is projected at 291,000, and then per year and then flat after that.

So we don't have any population changes incorporated in TABLE. The CPI lifter is 3% in 2028 and thereafter, because that is what all of our previous activity and known activity shows us in sort of the projection, the projection to keep. And so that is how it is applied. These are all projections and assumptions. They can be modeled differently, but the inputs are as they are based on our budget and our actuals over the last 3 to 5 years.

And Anchorage is 2.5% over the last 25-year average. So a 3% CPI assumption is relatively safe. It also doesn't— the overall assumptions also do not include any adjustment for funding emergency ordinances or any, uh, occur from FEMA recovery. Um, so, so it's a fixed sort of variable— not fixed variable, it is a, it is a fixed set of revenue sources and uses across the table so that we are using an apples-to-apples comparison. It is not an all-the-apples comparison.

It is the same apples.

In financing sources, we assume no additional grants, less dollars coming in, no, no new federal dollars or state revenue. The Community Assistance Program is at $500,000, so the state funding that comes through in the first quarter can be anywhere between $500,000 and $30 million, $20 million. In the last, I think, 5 years, it has— this year was the highest it has been at some odd— I can't remember what the actual appropriation was total, but the year-over-year projection that we see as the base foundational out of the Community Assistance Program is between $500,000 and $750,000. So that is the revenue assumption in the table.

Question from Ms. Park, and before that I'll just say too, connecting back to our legislative program, that is partly why for community assistance that benefits all local governments, but it is a direct part of our operating budget. And so having a clear picture, including if not funded anymore, we don't know that when we're doing our actual budget, but that is something that's important. Ms. Park. Thank you, Chair. Excuse me.

Does the change from prior year include any estimate for cost of living adjustment or anticipated inflation? Chair to Member Park, yes, that is the 3% CPI assumption. Thank you. Yep.

Sources also assume the Anchorage Hydropower dividend stays at $300,000 when we get into the utility conversation. We'll talk a little bit about that. There has been some second-year activity. The baseline dividend is $300,000, so we leave it at the baseline dividend for the out years. It also includes all of the details that are in the utility 8-year projections.

So this chart looks like 37 columns, but is actually an astonishing amount of spreadsheets behind it that calculate the tax cap, all of these different known things for this projection model so that the comparisons are right when we are— projection.

The MOA trust transfer annually after 2027, that is based on the assumption that the returns from the trust would be higher because of the size of property taxes. The tax cap limit assumed in the 6-year fiscal program is the same kind of assumptions we use in our year-over-year basis, but it leaves $200,000 on the table under the cap. So this 6 years, a $200,000 wiggle room space under the tax cap of that year. We also assume no new, uh, in 2028 and then thereafter. So those would be voter-approved, uh, funding requirements that then would be added to this.

And dividends from utilities and enterprises aside from hydro, as I said, are presented in their 8-year summary. And so those are pulled into this model, and the revenues are projected at a 2% increase in 2028 and thereafter. And that's based on assumptions we get from the Treasury Department. The fund balance use for the 100 funds is zero. We're assuming no fund balance use because that there would be fund balance in any of those 100 funds to use, so we don't bank on it being available until we know that it is there in the given year.

Any questions? So what you just said about fund balance, is that why in like, and following, we're showing negative $12 million? No. I love that. Okay.

But through the chair— Walk me through that line. That's a fantastic question because this is actually the thing that I flagged months ago. That is, part of the depreciation inversion of— and the $9.3 million. If you look at the chart on financing uses, the depreciation and amortization line is $9.3 million. We talked about that on the other— in 2028, the fund balance applied is $12.2 million, but putting $12.2 million into a fund balance.

You see that it is a negative fund balance, right? Which means that it is a gift. And what that is, is the conversion point for SAP to go from the depreciation model from the IGCs. I'm going to need you to say that again through the chair. This is This is part of— you may remember when we were— the fund balance deficits or the funds in deficit period, workers' comp, IT, et cetera.

This is the IT fund answer. If I can maybe restate, there's an obligation that we essentially have to pay or we have to account for any money that we have, and there's that $12 million. And so any extra to get that up to zero would have to be $12 million plus another, you know, whatever amount above that. Is that—. Maybe I'm confusing it further.

And frankly, this is going to take a while, so we may want to hold this for a different conversation because the general government department's paying the IT fund back. So this is $12 million of IGC's payments and other municipal entities. Utilities and enterprises paying back the, the cost of SAP.

So maybe I will suggest this might be a great topic for a future Budget and Finance Committee, and we could dig into it. And I guess the question is, is there a policy choice we can make in this regard? Like, would we be able to do something about this in the budget right now? It just looks weird because if what you look at is the depreciation and amortization line in 2028, 0.0 because it is the reflection of this swap. So we go from 9.3 in the proposed budget of '27 to in '28, and the fund balance applied is the— it's— I retract my rabbit hole question and would love to cover this in a future budget and finance Okay, yeah, I think we can understand maybe for the December meeting.

But yeah, I think let's dig into it, but this is probably not the place to do that. So, okay, any other questions? Slide.

Okay, and then, Miss Perez, can you remind me, so the, the, you were referring to the roll-up and then there's the 6-year fiscal program in our book is really the full discussion of this. The 6-year fiscal program is the whole front of the book. So there is narrative and detail on all of this. This is the chart that rolls up into the actual deficit total for the projection. And because we want to know where that comes from, we go through what these assumptions are.

So, you know, why we are assuming a $14 million 2028 and what those inputs are and what they aren't. Because one of the things that is a multiplier of the deficit is we— if we— let me continue through the financing uses. When we make a conversion between the number of hours worked in a year, that's your basis. One year it's $2,088, the next year it's $2,096. It's calculated on an annual basis.

Every 8 hours that we add or subtract dollars in the budget. So the assumptions we go through and we have to calculate the hours of each projected year means add it to the labor cost, and that is part of this. So the financing uses include the hour count projections. It includes the current CBAs, everything that is currently known going forward, and if there are contracts contracts that end at any point in the 6-year projection, the final year of that contract as is the municipal process so that we aren't not accommodating something that would likely be a cost. The salaries and benefits are assumed flat.

The executives and non-reps are at 1.5 in 2028 and there's a salary is flat. The— this does not account for non-step, non-rep step progressions of 9 through 12. This is where we're going to get slightly— in the recruitment and retention changes that we have made over the last few years, part of that collective bargaining outcome was adding steps to everybody's pay schedule. We had a place for them to go to work at the muni longer and continue to get a cost of living increase. And that means that there is current cost inflator in those contracts that is not an annually negotiated year-over-year wage.

Those 2.5% wage increases above steps 9 through 12 are not in this projection because those new steps instituted at a time when they wouldn't make it to 10, 11, and 12 yet unless they have been enhanced in some way or merit increases, et cetera. So we don't include it as a cost in here because it is not— apply it universally to all of the bargaining units. I'm saying that just because it is part of the blend of how we roll and is part of the cost that we do not have and we can't predict right now unless we were to go through the full modeling That is one large cost item that is not in this modeling process. The other large cost item is that increases for all CBAs are not included in this cost model. What is included is the year-over-year increase.

So if we take the IBEW tech contract and we know 2% increase on '28, we add that 2% increase. What we don't add is the 2.5% increase that comes with that labor set getting to their work, because that's all part of the labor scrub that happens with each budget and is done by hand for each individual PCN in multiple layers of medical costs, the actual labor grade classification, et cetera. Those changes are not projected or included. Or in this fiscal program projection, which is where we get the $14 million for '20 could become $20 to $30 because that step progression, that cost scrub in the '20 was $5 million. And if we project that we would get the same scrub or potentially more, we have to add that to the bottom line.

And that means that we have hit a $19 to $20 million deficit. And there are other variables that we cannot accommodate for right now that could make this bigger.

Okay.

So I think what I just heard you say is that You see here in Appendix C is going to look like the 2028 version of Appendix C to us at this point, but that will necessarily change the projections that are in this table when we have Appendix C 2020 Extended Remix.

Yes and no, right? This doesn't— I think it depends on who you are applying to because they roll deadlines at a different year. So right now, the APDEA inclusion within this 6-year fiscal has assumption from 2028 going forward because their contract has not been negotiated at at all. And, but some contracts have been negotiated, and so it's for real, or at least as it's presented in the current collective bargaining agreement. So there is right there timing of how we know what we don't know, and it's why the 6-year fiscal projection changes so drastic— dramatic— drat, drat, drat, all the above— dramatically.

That's the new one, uh, every single year, and, and why we have to pay $14 million this we could come into a bunch of money, or a contract could become really expensive, and we have to pay attention to how it changes. So we go from a safe $14 million to—.

I would just like to say for the record that my favorite thing is asking the OMB director a question and then to know.

That's actually a really interesting thing, because the municipality a lot of things that we see on the face of, right? There's a lot of visibility, a lot of content, a lot of information. It's always true that the rest of the story matters and, and will be the thing that stops you or do whatever you are trying to do. And, and I think that can feel really frustrating for people who, who don't have time for what the rest— or it's not plain enough to be able to contemplate how we can change this. It is complex.

Context, right? Welcome to my world, our world.

Uh, let's see. Okay, so I think we'll—. If we can wrap up on this slide. This one's done. Yeah.

Okay. Um, one other thing I'll just briefly note in terms of unknowns, uh, just one example for folks to think about population change, right? We have a lot of people move here, pipe, gas line, all of that stuff that can change our— if most of those folks, for example, moving to Jay Bear or moving to work on Jay Bear, if most of them move to the Matsu, then these numbers don't change, right? So that means 2,500 more people that are area, uh, that don't live here. And so the—.

So that's also just even with things that we know are having up, and if there are residents or someone else's residents, because all we count is residents. Um, okay, I think We're good on this section. Point folks to this— sorry, I don't even know, we're all having challenges.

So this is the surface, skimming the surface. The book is— and probably too much, but it has everything. So next we're going to switch gears. Obviously we did our lunch break already, so we're going to move into our next section, which is enterprise and utilities. And this one is going to be a more— I think there's probably an overview, but it's at each of these individually.

So we'll have you up when we're ready, but otherwise I'll turn back to Ms. Brause. Sorry, not department heads, utility heads and enterprise heads. Thank you, Madam Chair. I think we can— do we just want to start the parade? I don't see why not.

We will run through each of these. We will move ACDA to the next work session. The timing on calendars makes sense for us to put ACDA Next week, if there— we have to believe we have all of our directors here to go through and explain some of this as we go. But we can start with hydropower if we want to have— and I will start walking through the Anchorage hydropower between the 2026 revised budget and the '27 proposed budget include a couple of interesting things. It would be relatively simple.

We are including a $1.9 million increase on the dividend to general government. Hydro, as I said, traditionally has a $300,000 general government— I say traditionally, it's only existed for 3 years maybe. And the $1.9 million one-time increase, this is not— It's a one-time, meaning it is only this year. It is not a recurring increase. It is not the first time it has happened.

Dividend or larger dividend was taken from hydropower in '05, I believe, and this is part of the analysis process, the general government side, when we are looking at our revenue sources and our potential dividends, our utilities and enterprises, and Hydropower has the flexibility to give this permit in 2027, and in 2028 and thereafter, we are assuming a $300,000 dividend action is taken. But otherwise, it's a relatively small operating and budget, but the total appropriation is $7.5 for 2027. And if Mr. Stafford has anything to say.

Questions about hydropower?

Miss Baldwin Day. Yeah, I'm curious about the dividend to general government. And is that on— is that dividend generated on like a revsat? How does that dividend materialize? I'm pretty clear on from like how other dividends are realized, but this one not so much.

You wanna do it? I think in general, Member Baldwin Day, the hydropower utility has at least 3 streams of incoming revenue, and I'll have the director nod at me if I get these right. B, the Rump hydropower utility ended up receiving power purchase agreement sales revenue for power that it sells to Chugach. It ended up receiving revenue for MEA, and then it also receives water diversion income, which has to do with water storage, etc. And Babbard can speak about that more generally.

And then it is required that Fish and Wildlife agreement to squirrel away, I think it is $3 million, sort of in a lockbox. And so it's always done that, and then it has to be in the Fish and Wildlife program, which it is doing, and it actually is doing it in a little bit more forceful way than I think was originally anticipated at the time of sale. But it is our sense that putting all of that in the blender, that this donated this year.

Thank you.

Okay, I don't see— okay, there you go. Hydropower.

Awoo. Sorry, before we move on from hydropower, I do see— I'm looking at my print slides— just there's a very brief—. Oh, the capital. Capital. So is that what Bill is— or Mr. Falsey was just describing?

Is that portion of the $3 million? This is wildlife participation from hydro.

Great, thanks. Yeah, just as a reminder for folks, for these in particular, we're going to have a slide on capital, and then we'll talk about the capital generally, but for these, because they're kind of their own thing as well.

Just— Awu, you want to take this one? Yeah. Thank you. David Persinger, Anchorage Water and Wastewater Utility, General Government. Or general manager, looking at the Anchorage Water Utility, but a flat budget going into 2027.

You'll see there's one full-time equivalent added to our position overseeing our customer service supervisor division. We're in the process of going out for a new customer information system, and that's 'cause 3 years getting that software work through. And so that's bolstering our Customer Service Group with that.

Okay, questions from members? I guess one real basic one: can you describe why we're seeing water— obviously your water and wastewater— but can you describe why, why those are different in the budget? Yes, uh, through the chair, the Anchorage Water and Wastewater Utility is regulated by the Regulatory Commission of Alaska. It's two separate utilities. There's Anchorage Water Utility.

Now you'll notice our position counts share between those, those are split based on the percentage they're used on each utility. So you'll see a water utility and a sewer utility, but there's a portion in between that. Okay, thank you. Any other further questions from members? Through the chair, I will say that as was just mentioned, the sharing of the positions, if you look on the slide deck, the lower right corner of Anchorage Water shows the position count, 249, 3, 5, right, for full-time, part-time, temporary.

Underneath that is a very strange number, but that is because when you get to the waste, you see the position count relatively close, but the FTE count slightly different, and that is rolls up, but they are allocated to the utilities in a nonlinear way, right? It's not one position, one position. It's not even half a position, half a position. That's different. And so they land in a position count versus an FTE count in that fashion in the lower right corner.

So sorry, I just skipped ahead over all your capital projects.

And then moving on, on the Anchorage, what fairly robust capital program, large mix of projects across municipality. One thing I wanted to draw some attention to is a significant investment in the— that includes a new reservoir site, a new well house, a new treatment system. For the Girdwood community.

Was there a question for Ms. Bowman?

Okay. And I have just a brief question on the capital. So not digging in on two pages of them, and it says debt. Can you clarify? Because we don't vote on— like, I've never voted on an AWU bond.

So what does that mean when we say debt? Where is the revenue? Thank you to the chair. The Anchorage Water and Wastewater Utility takes extensive advantage of the Alaska Clean Water Loans and Alaska Safe Drinking Water Loans through the state revolving fund. And so we borrow a lot of money through that.

That's primarily where the bulk of our debt comes from. Thank you. And to that point, I'm just going to do a very brief disclosure. As a resident, not as an assembly member, I am engaged with some of my neighbors in a project implement and improvement district. And so what I've been told is in a future year that may require amendment of the CIB.

So I just want to be clear That project is not listed here. The intent is not to— and if we were further along, then I would be recused from this discussion altogether. But just to put that on the record as a disclosure, I've said this in a committee as well. Thanks. I think we can move on.

I don't see other questions.

I'm moving on. Similarly, on the wastewater Anchorage Sewer Utility, very similar changes. You'll note the one FTE for the customer service and then water budget very flat, essentially maintaining status quo.

And similar to the water, significantly smaller capital program on the sewer side. That's primarily driven by our financial condition. The sewer utility, particularly Anchorage.

And question for Ms. Baldridge. Yeah, I think this is just a question more broadly. At one of the recent IEEOC committee meetings, we heard a pretty extensive report from EWU about sort of the increasing severity of those kinds of things on the capital side, but also on the labor side in terms of addressing some really serious problems, an unusual winter, but a winter that may be becoming more— I'm wondering how not only this year's budget, but perhaps to start maybe dealing with severe freezing events on a more regular basis. Thank you. Through the chair, very correct.

Last winter, challenging winter, not only from Alaska with the very wild and crazy temperature swings. Back to what I said earlier, utilities regulated by the State of Alaska Regulatory Commission. Means is, and it's also for us to recover '26, those would go into a potential 2028 rate filing. And so, You're absolutely— we saw a cost increase. Those will come further along once those costs are fully audited and that we can actually put those into rates.

But for now, we're floating those costs essentially. Okay. And so where we would— so the soonest that we might see an adjustment relative to those would be 2028. Is that what I just heard? That is correct, yes.

The way that we're regulated, we're based on historic test year. So if we file a 2020 increase, that would be based on 2026 financials. And I'll also add on the capital side, we have water, wastewater master plans and facility plans for all of our facilities. And those are trends in weather, you know, trends in climate and, you know, anticipating changes and building resiliency into the— one of the things we do is, you know, looping water mains. We don't have dead-end water mains.

That provides a lot of resiliency at a, you know, sometimes a fairly moderate cost. Thank you. Yeah, that's helpful. And I appreciate the attention to detail. Okay, any other questions?

Don't see any right now. Okay, all right, well, thanks for—. AWOL folks for being here.

Danyang Port of Alaska, come on down.

Up next, Port of Alaska. We have our team members here. That's right.

Do you want to take it through?

Okay, Cheryl, do you want to take it through?

That's the right answer, Cheryl.

The changes within the port are relatively limited aside from the $20 million debt load, about 4 years. Maybe it's now coming home. So that is the interest on bonded debt associated with the financing plan, a slight increase in salaries and benefits adjustments that include the Rule 6 and 27, but also include the full cost of a couple of the positions that were changed in the— that were only funded at partial year. So this is the—. Full year for, I think, maybe 2 or 3 of the positions that changed.

'26 Budget, the $3 million change in depreciation, and that lands us at the '27 proposed appropriation of $52.8 million with 24 PCNs.

I don't see any on the operating—. Miss Baldwin Day.

So the, so the $20 million over 2026 is largely attributable to debt service. Is that what I'm reading? Okay.

We need the net zero change in lease principal and interest expense and how, what that represents. And then over to you, Shirley, through that you're talking about the $52,000. So this is, this isn't, as far as I know, my bat phone over here might tell me if I say this wrong, but this is an accounting requirement to align with GASB, which is the Government Accounting Standards requirement. The GASB rules change on an annual basis, it seems, and when this specific cross, we have to align where we reflect the lease and principal payments, and this is the lease and principal payments. What are we leasing, or what is—.

What is— yes, I'm not sure.

Okay, okay, through the chair, so the GASB leases, uh, were change to provide value, the value of the entire land leases at the port over their years of lease. So you have to record that in, and so there's a true-up that happens, and it's a large worksheet that takes into account all of the land leases that the port has. And it's not only land leases, it's long-term leases on equipment, on software, on anything that, you know, might have a life longer than a year. So, and then an adjustment that's made by Central Finance that keeps the list for us, and we truly is a true-up, but But that's kind of the details that make that number up. And if I may, through the chair, this happening throughout the entire municipality, this is not specific to the port.

This GASB adjustment is something that the controller and accounting division is working as we are having to convert the entire municipality and the way we have traditionally— our lease process, our lease contracts. And it's a lot of work. It is. We can do it. Work session on that committee if that is useful.

But this is a specific alignment that you may see in other municipal departments because this activity has to— best practices and accounting purposes. Thank you. That's helpful.

Okay, let's go to the capital on the port. Oh, you're not done yet. We were hopeful. Capitol review, go ahead to come, like any you want to highlight specifically, or any assembly questions on the individual projects.

I guess for a couple, I mean, one is thank you for including the Ship Creek boat launch. Those of us who've been here a few years remember that's been a whole thing. So thank you for continuing to take that on as a responsibility. And then my biggest question here, can you explain Obviously, we've got a $2 billion port modernization project that is a massive capital project. Can you explain why that's not here?

Because we know it's in a showing up in the debt service, I imagine, but why it's not kind of included here, whereas there are these kind of smaller, relatively smaller projects?

Through the Chair, I can provide some insight onto why the port modernization program is not listed as an object for 2027. So if you'll think back, the assembly appropriated all the funds to work on Terminal 1. So when the contract for Mance& Michael Joint approved at the assembly, that was approved at that time. So there is no action of appropriation on behalf of the assembly. And this— so at such time there'll be appropriations for the PAMP, it'll come back through to the body and you'll see it.

This particular list is appropriation for ongoing capital projects at the Port that's not PAMP. So, any questions? Thank you. Other questions? Ms. Baldwin Day.

I think it would be, it would be useful and— at an Energy Enterprise and Utility Oversight Committee meeting in the future to understand where we are in terms of what we budgeted for the PAMP and what our actuals are at this point. I've gotten a lot of questions from interested constituents who are tracking, paying remarkably close attention, actually, orders and contract adjustments and things like that. And they're sort of wondering, like, where are we landing? Like, what's our burn rate with respect? And so I know that I recognize that's not what we're talking about here today, but I think I would be remiss if I didn't say, I think there's a lot of interest in the community to understand, are we on track?

Are we on budget, are we on schedule? If not, why not? And if so, great. I think that would be a helpful presentation to have at some future, future point. So thank you.

Yeah, through the chair, I would say at the last EEEOC meeting, we started down that road to kind of do a, hey, we're ending the PAMP, here's where we're at current state. We didn't go into detail or change orders and the impact to the project financially. I certainly think that we can incorporate that into future meetings. It shouldn't be bringing forth, you know, a really good idea of where we're at spend-wise, what we are— project status, right? That's important to everybody in the community.

So we'd be willing to put all that together and share. Also say, uh, again, just to your Ship Creek boat launch, there will be much more to come on the Ship Creek boat launch. We're identifying a lot of issues down there right now currently. I certainly have to do with the budget for this, this cycle, but and in disrepair, and it's down there. So we're happy to take that on.

We're excited about that project, but there is a lot of work to come. So just on that point then, so the $150,000, that sounds like it's in the ballpark of something like a study or something of that is, or can you describe what that is doing in addition to the actual dredging?

Through the chair, that's almost all entirely for dredging. We have some maintenance costs, uh, uh, banner happening that we have to spend a little bit of money on, but almost all of that is for dredging. OK, so then I'll correct paying for studies. It's that you guys are looking at that in the meantime doing dredging. And through the chair, I will say that's 2 or 3 slides about the port, but the utility and enterprise budget has 30 pages of port detail.

The write-up on what those costs are and what they— the items 1, 2, and 5 for stream storm drain enhancements. So there's—. There is useful information for people who may be trying to round in the detail to begin with, and then additional questions, I'm sure, would come after that. Okay, thank you. I don't see any other points.

I think we can move on.

And I'll say, as folks are coming up, I neglected to say thank you to the Port folks, and I will say preemptively thank you to all of the utilities and enterprise folks who are here. If I forget to say that as you're swapping out. Okay, so we have Earl Malpass here from the Municipal Airports, otherwise known as Merrill Fields. The updates for Merrill are very minimal, but the story behind Merrill operations is very good. So we have the revised budget appropriation of almost $3 million, $2.999 million, some small changes You service change line, less lease principal interest expense.

It is part of— it is not the GASB change, but it is all part of making sure that we are where we need to be in expenses and how we are accommodating them in our financials. The $124,000 for salaries and benefits adjustments for the 12 positions at— and the small increase for ground maintenance services. As well as security and alarm service upgrades take them to $3.4 million for the 2027 appropriation. If there is anything else you want to add for Color and Operations? It's pretty boring.

We've peaked out with our Landfield tie-downs for the time being. We're the most expensive airport in the state, so we're going through and letting that pencil out a lot of the direction going forward. Be glad to answer any questions that you may have. Okay, Ms. Bowman-Dick. Thank you.

Thank you for being here. I seem to remember that at one point over the last year we needed to reduce, or we didn't have coverage for air traffic controllers at Merrill. Are we still in that same sort of kin with respect to ATCs? Through the chair to Member Baldwin Day. No, ma'am, we've— it started in March.

They— the FAA had some manpower issues, and they played through that. It took 6 months, ended in August, September time frame. They've completely recovered and have added additional manpower staff that they— and again, that's an FAA tower. That's excellent news. Thank you.

Glad to hear that.

Okay, any other questions? Let's go to the capital. Okay, let's go.

Uh, oh, do you— anything you want to talk about your capital projects? This is, uh, our— I guess you would say what we are anticipating and planning. As I mentioned, we're doing our master plan, so there could be some adjustments based on what the research does on that. But They're, um, these are— there's only, uh, these two items. Again, I didn't add a third one for the following year because of the master plan.

Putting all the stuff out there, there's, uh, ideas of the— like a start where the airport would start actually, or revenue stream, which would be selling fuel on the airport. Right now, currently, the, the only ones that are selling tenants of ours, but there's some— a great deal of interest through the initial reports and the surveys that are coming in from tenants that they would like to see the airport have what they would call fixed base opera, where we would be selling fuel, and that would be a big benefit for a revenue stream.

Any questions on those? Yeah, thank you. So, um, So are these projects that the FAA has already greenlighted and said yes, these are a go, or presented to the FAA with a request to fund? Uh, this is Member Bowman-Gway. The Electric City property is a property that's currently for sale.

It's like an opportunist chance of getting some property that would extend or give us additional revenue. That's been tentatively approved by the FAA that would be purchased in FAA funds, AIP funds, that requires a 5% match. They've tentatively, uh, based on the master plan, they want to make sure that the consultant did that. We've also previously brought it up to the assembly, and Ed will, based on some of the issues that we're, uh, we're looking at as far as environmental— it's known as the, the former City Electric property, and there's environmental issues. Merrill Fields worked through some of the— virtually all those environmental issues with our— in the Alaska DEC.

I think we're pretty in pretty good shape with that. We've also received— we've talked with the controller and Office of Budget Management as well. Some of that depend on our audited fund balance. We've got an idea, as much of an idea as you can get from, uh, as to what our fund balance is. But so we— that, that addresses the Electric City property.

The, the tax away and rehab, again, we have on that. Our PCI, the pavement condition index, uh, indicates that they are due a rehab But again, the FAA let the consultants pencil out everything, and there's some questions as standardization of taxiways crossing the runways, and they want to get that— they want the engineers to look at the sandstorm wall. They've also looked at— it's on our airport capital improvement plan— a concrete wall dividing the sand portion and the airfield maintenance equipment. It's starting to bulge, and we're looking at that and getting up, uh, going to be designing that in the future. The FAA is aware of that.

They've done a site visit. And lastly, aviation fuel. The FAA has looked at that. There's a good possibility for granting grants on that as well. Merrill Field, as a side note, a couple little bit more, the FAA has mandated transitioning from 100 low lead, which is a heavy leaded fuel for PISRF.

They're transitioning from that 100 low lead to an unleaded fuel. Tentative date is 2030 for the lower 48, 2032 for Alaska. First in the state to have one of the three have fuel tanks, as well as I'm told we have this unleaded fuel on site as we speak. So, so if we— if once the FAA has agreed, and they agree, there's a—. They will—.

There's a set-aside in the AIP grants that will allow us to have the FAA fund unleaded fuel tank like a fuel farm. So that's again a segue into another revenue stream. Revenue stream for Merrill Field. That's because usually the AIP funds are for infrastructure only, not revenue-generating entities, but they recognize, and the FAA is trying to incentivize a transition from the 100 low-lead to the unleaded fuel. Thank you.

So, so these— so the federal dollars that we see here are, are FAA will be coming in, and the equity funds are the match for the FAA. That's correct. Excellent. OK, thank you. And thanks for the work you do.

Thanks. Yeah, the chair, I will clarify that the city, like, M-L-N-B. OK, so some other entity called City. Like, I have myself in the queue and then Ms. Park, just briefly, and I should have asked this to an earlier one. Can you, at least from the airport's perspective, can you describe, because I know you're essentially a closed system as a budget, you're collecting fees.

There's not generally general government that goes in there, enterprises and utilities. So the equity, is that essentially I'm going to use an HOA analogy, you know, I pay my dues, we build a budget as the board, kind of reserve fund for our capital improvements. So is that your own budget you're looking at how to build into and to have the equity to build these projects? Is that correct? I'd say the chair correct.

Yes. Yeah. And I know there's probably a version of that with the other—. That's true. And that is, that is why Earl said as much as you can get from an OMB director, or as it has to do with The actual fund balance within the operating accounts at Merrill have to do with the actual when those are actually audited and come back and that equity is available for them to then spend on this project.

So it's all part of that cycle, right? Our—. The municipal— we have municipal debt. Our municipal equity is, you know, tax abatement and all the other things that we can provide. We don't have the same kind of cash equity unless it's budgeted specifically.

Thanks. Yeah, I know the water and wastewater and other utilities, they build that into the rates because they're regulated. So, okay, any other questions on airport? Oh, sorry, Miss Park, go ahead. Thank you, Chair.

I just had a question regarding—. There's a property between the old Peggy's Restaurant and the Welcome to Anchorage sign. Wondering, does that still belong to the municipality, and are there any plans to that? Uh, through the chair, to have that property, it's just north of the— or it's on the approach into Runway 16, and it's, it's what they call Runway Protection Zone, RPZ. The FAA restricts any kind of structures being put into that location so that there's no issues with or protruding into the, uh, the glide slope of the aircraft coming in.

Yes, ma'am, it's required to remain as is.

Okay, don't see anyone else, and then I will again put in a plug for our Enterprise and Utilities Committee— Energy, Enterprise, and Utilities Committee— if you want to deep dive on these projects, we can do that at a future meeting. So, um, okay, next, uh, let's move on to, I believe, Solid Waste Services. And then I will note this is a similar 2-in-1 utility, so you'll see we have the Disposal, and then I believe— or sorry, refuse. So we're calling up Ms. Toth, and then just for a check, we're on a slide, then this is our last. As we said, we're not gonna cover ACDA today, so this will be our last in this section.

We'll take another brief break and then we will transition over to the capital budget. As I know, we have another set of folks here for that.

Okay, solid waste services. We can run through these. Relatively simple changes. And then any questions? The disposal, uh, 2026 revised appropriation is 36.2, and the 2027 appropriation is less.

We are dropping off some of the one-time costs, uh, for, uh, the capital projects, and charges by other departments That's, uh, various adjustment detail, and we can go through that when questions are asked. And then salaries and benefits adjustments for, uh, $38,000 take us to the continuation level of $35.7 million with waste-to-energy grant services being added as well as a new environmental specialist. And that lands us at $36.1 million with, uh, 57 positions, FTEs. Any questions or color? I don't see any right now.

Let's keep going. Okay. Disposal, CAS, uh, best relocation, CTS, electrical improvements. That's a lot of acronyms. I bet you we can say what they all are though, if you have questions.

Good question. I guess I think people are digesting. I have one, I'm thinking about. So disposal, I imagine, is the landfill. So really almost all of the capital projects we could probably contemplate are within the disposal side, the landfills.

Chair Brawley, yes, that is true. In fact, though, part of the disposal cost does include like transfer drivers, for example, from the Central Transfer Station or CTS. And then that also includes Girdwood as a transfer station as well as the MRF. So a lot of the shared services are already between the two utilities, between collections and disposal. So is that helpful?

Yeah, and I did skip ahead. I saw that there are some capital things on the refuse. That is helpful to think about. Most of it is the actual sites. Okay, other questions?

Okay, let's keep going. Okay. Yeah, go ahead. Sorry, Miss Scout. I actually don't know what BSS or CTS stands for.

Okay, the BSS—. Sorry, uh, the BSS is actually the battery storage for the EV collection vehicles. So that's the battery storage that is being relocated. And then CTS is the Central Transfer Station electrical improvement. So we're putting in a bull rail to plug in vehicles for, and also improve lighting in the area, if that helps with acronyms.

Thank you. I should have known CTS. It's too big. Okay, let's keep going. Okay, so the refuse side of SWS, you see small change in continuation level and refuse collections tipping fees going in the proposed budget changes at 8.

$1.06 Million appropriation for 2027, a $0.4 million change from, uh, 2026. Any questions there?

And these are the projects on the refuse side, so you see the other side of the bus there.

Okay, any questions from members here? Miss Baldwin Day. Yeah, so the totals for the BESS and the CTS are split, disposal and refuse? Yes. Cool.

And is that proportional to the number of vehicles that are utilizing systems? Through the chair, typically these projects are split 60/40, so it's just because of the way the utility mix. So when they do share, it's usually a 60% disposal, 40% refuse collection. Cool. And then one question on the disposal side, on the operating budget side.

So we've—. I see we have waste-to-energy services. Yay. As part of the proposed budget changes, is the new environmental specialist connected to the waste-to-energy project, or is that a different—. So through the chair, no, it's actually separate.

It's having someone out at the particularly out at the landfill for all of the regulatory changes that are happening and also just following permitting process that we have out there is pretty robust. So having someone that's well-versed in federal and state regulations is tremendously helpful. Thank you. I have myself in the queue. I have a, and this is probably a question we have to take offline, but I think it's a budget fuse collection that is a smaller area.

I don't live in it, for example, just the folks who get SWS service in that regard. I know there's been a lot of discussion about bear-resistant trash cans. So not getting into all of that, but I'm wondering, for example, within the folks in the SWS service area, knowing again, that's not Hillside, that's not a lot of places where this is happening, I guess, is there room in your mind to, for example, appropriation where we have funding to buy more of those, or is— I guess I'm wondering, like, is this a plan, or is it something that needs to be a grant, or is it something that needs to be from third parties that do that collection? Just wondering, because I know that question is going to come up. So I think the question is, can we do something here?

And then should we do it is another question. Just wondering if that's in the scope of that utility or not. So, Chair Brawley, what we have done is part of the cart. It's, it's a line item in our— it is the cart, the carts themselves. And so whether they're bear carts or regular carts is all part of the performing and how they want to appropriate it.

But that's also within, just within the SWS service area, that's, that's part of our budget. You're talking about outside of the service area, which some of the areas of concern that we've been talking about, necessarily SWS, then that's going to be a larger conversation with the commercial haulers within, within the MOA. Okay, thanks. Yeah, so I think anybody interested in that conversation, sounds like the director offline, and it's probably not just as simple as adding money here, so Thank you. Any other questions?

Okay. Thank you for being here. Thank you. Okay. And we are moving ACDH to next week for availability.

And that takes us to a short pause. Okay. So we will honor our 15-minute break. So we'll say we will be back here right at 2:30. I'll keep an eye on the time.

Folks are welcome to step away. If you need to call back on the phone, then aim for that time. Thank you.

Okay, I need sleep.

No, I mean, that's not our job. Yeah, but also, so just, it's easier to just They're cute while they're in your driveway, right?

Okay.

I agree. Okay, everyone, back to order. So we are in the last chunk of our work session for today. We are moving on to our discussion about capital budget and facilities, capital improvement budget. So I'll note we are still on the slides.

I believe we would be at slide 43, or right now 42 is on the center. Also just note again that we are not, Oh, sorry, never mind. Okay, so we will get, we will have staff deal with the TV not turning off, and then I'll also note that we do have a number of department directors here, so I'm gonna remind folks, discussion about operations of those departments, I'm gonna ask folks to hold questions on that, partly because we have an hour and a half, but also because I don't have the information before us for that. And then I will also say, I imagine there's gonna be more discussion, for example, about roads than there will be about the library. But to the extent that we can get folks questions answered from department directors.

We may release some of those department directors if we are— that discussion, but I know we want to have a bigger picture discussion about our bonds, about our capital projects, so we are making space for that as well. So with that, I will turn to— we'll go through an overview.

Thank you, Madam Chair. Uh, let's start with the 7 proposed capital budget goals. Um, the, uh, '27 budget includes, uh, critical road maintenance and drainage work, including A replacement of fire apparatus and investing in additional ambulances for better service and firehouse replacement expansion work. Uh, be a very good conversation in terms of, um, service level staffing and, uh, the services that the community, uh, has available to them. Uh, upgrades in our, uh, municipal facilities and venues and, uh, specifically, uh, larger community buildings.

Um, that is directed at both facility maintenance and energy consumption. The buildings get the efficient they are, and then they cost more money. So we're trying to control traffic calming and pedestrian safety and repairs and enhancements to neighborhood parks, playgrounds, and trails. State Park capital summary. This is a roll-up of the information that is presented to you, a portion of the capital budget.

You see this breakdown by department sources we would propose the money to come from. So for the fire department, $7.2 million. Infirmiji, $700,000. Other, that get into the project detail, that's the ACL IT amount that we put towards our computer infrastructure and it's part of bond. So that's why it is in the quote other column because it is not a bond, it is not from the state, it is not federal, it is from the general government budget.

With a $2 million project, et cetera, et cetera, et cetera. We're gonna go through this list and all of the individual projects as we go through the departments. But overall, it is an $87.95 million bond request with $1 million in state funding as either part of a request or a match that would be expected or is already promised. And 16.5, the other column is a combination of sources depending on what it is. As I said, IT is the 7/15, Operations is a combination of both the fleet levy and intergovernmental charges for fleet services.

And Parks and Recreation, Management and Engineering can tell us what their specific other funding is, but that's how this chart breaks down. Any questions? Questions? Okay. The capital improvement budget by source.

Again, this is where the bond, state, federal breakdown and the bonds 2026 and 2027. Those are the amounts from public finance and Okay, the capital improvement— worry of project. This breaks down what kinds of projects they are as opposed to the department that is doing them. Um, this, uh, $13 million being proposed towards energy efficiency projects, $31.5 on facility improvements. That is significantly more than facility improvements has seen in a very long time, and that's made up of municipal, municipal facilities, the Performing Arts Center.

We'll go through that list as well. But overall, it is a 10% investment in energy efficiency, 23% in facility improvements, and 45% in roads and transportation for the total $136 million capital budget.

Any questions?

Uh, Miss Baldwin Day, I see, I see. Okay, let's continue. Sorry, Mr. Handeland, go ahead. Uh, so for, for school district, for all their stuff, all their bonds and stuff, that's completely separate? We don't deal, deal anything with that, correct?

Through the chair, yes. Okay. Yeah, and I know that is something we'll actually get as a, as a package from them at some point, so, so we definitely deal with it in the sense that we, I think, approve it to go on the ballot of this list.

So I guess my question kind of is like, because we're starting to get into learning the things, like technically we, the municipality owns it. And so I guess maybe just a little bit, I don't want to dive too much down a rabbit hole, but see, right, I think what you're asking about is the fact that the muni is the like parent unit of ASD, and so the ownership of the buildings going back and forth and the— that What does that mean and how does all of this tie together in the timing that we have? And I think that's one of the challenges that we are across the board is that there is a lot of landscape that is changing and it is changing in a way that we have not necessarily— and so coming up with what that looks like and what's a reasonable response is a process. The ASD bond package is something that we contemplate when we are We are fully aware of the history of the bond packages, the success and failure rate, the importance of actually establishing capital improvements within the school district, which are buildings we are responsible as a cost item for us in the long, long run. And part of that is the communication with the school district, what the bonds— it's why we have those joint meetings for the school district and the assembly, because while the— they are just making processes, They all overlap onto property taxes.

And ultimately that means that any decisions we make and any decisions they make, and we have to be sort of alert to that more than ever in the past because of just that are happening all at the same time. Okay, just, and then just one final question. So if voters approve up to the individual building or, 'cause like, I guess, What if it was, hey, we need to replace the roof, all of a sudden ASD says, hey, we don't need this anymore, but needs improvement and stuff. Does that follow along and all of a sudden shift onto our books, or would we then have to essentially rebond for that?

If—. So say there, yeah, a school, the brand new roof, and voters go and approve. Before that actually gets any kind of construction or that project goes through, ASD says, hey, just kidding, we actually don't need this building anymore. It gets turned over to us, dilapidated, and have water damage. And so we still need to have that project go through.

How does that bond follow the building? Or because they've now turned it over to us, do we have to now then do a brand new bond for that? I believe, through the chair, answer is it depends on the language that authorized the bond. And, and that would mean that if there wasn't language that says, or other projects as a— meaning if the bond is proposed with an assigned tool and it is not a bucket of funding for roof replacement, then it has to go to that school unless there is other language within the bond question that says, if we don't need to do it like this, we also can do it like this or like this or like this. And so it depends on the bond and what the language was the specific bond question.

So ASD could sit there and say, okay, we're going to use this for another project, hand us a building, and then we now have to figure out how to basically repair that? I, I, I don't know that we would have to figure out how to repair that, but it would depend on the specific circumstance.

Any other questions?

I don't see any right now. Yeah, I don't know, um, we will see— it's later in their process, but we will see that as an ordinance. I think that's and we can talk.

The— so this is the funding by source, by category and by source, and this is the state capital grant spend or receipt, if you will, over the 30 years. So the reason this is important to look at is because a very significant part of our cap and capital activity historically has come from the state funding. And this is broken down into municipal and obviously has over $1 billion worth of projects and funding assigned to it over those 30 years. But you can see in the last 15 have gone blank, which means that that $300 million that we have received in the last 15 years does not cover the same square mileage or square footage as the $700 to $800 million that we received, that you can see a very significant portion of that funding management and engineering column. That means it's roads.

And the situation impacted by the fact that we do not have that $500 million going into this map and our 2027 capital improvement budget map that outlines the projects by specific project and by sort of category of project. Some of them are area-wide and don't have specific locations. But I think that if we were to envision a universe where we had an extra $500 million of projects on this map, it would be— and that doesn't mean that we can't do that. It just means we have to figure out how and what does that look like and what does that mean for the community.

And I will note again, another program with our optimistic hopes that we can get some money from the state. I also wanna note, I was just looking up ACES, the prior oil tax scheme was approved in 2007, ended in 2013. Interesting, a massive drop-off in 2014 of state revenue to the city. Thanks. Okay, sorry.

I think we can move into the department review, and we'll talk through the specific projects included. As the Chair said, I think we can probably get through quite a few of these relatively quickly because they are single or simple projects to a larger conversation with some of the larger departments like Parks and Rec and PM&E.

The information technology project, as I said, is the $750,000 cycle program within the municipality. It replaces our computer infrastructure and is— any questions on that? I mean, I know we have a lot of questions on that fund. Sorry about that, member.

Okay, the library project. Why don't we—. Hey, all the way in the back middle, that's perfect.

Director Harrison will come up and we can talk through the Lusak Library project. This is part of the facilities, the all of the above category of deferred maintenance, if you will.

The project has lived in the capital budget, I believe, at about a $10 million increment. And that is a placeholder number because the design work and detail of the construction has not been done yet. So it was reasonable for us to envision a universe where we go through that design process while we are making desperately needed improvements to their HVAC system. System. There is specific project detail in the library section of the capital budget, what that kind of a project would entail.

But Director Harrison is also here if there are questions specific for the library and this project.

I think, yes, a couple. Yeah, I think, I think I think if you can just get its version of what happened recently, because I don't know if everybody's aware, and I think that's what people are wondering.

Happened recently regarding HVAC within the library. Yes. It has— the HVAC system in the library is broken.

Yes, it is broken. It can be very, very—. 94 Degrees in my office a few weeks ago, and on the 4th floor it was in the 90s. Anywhere you went on the 4th floor was in the 90s. At floor, it was averaging about 85, and as you went down, the 2nd floor was a little— was still in the 80s, but the low 80s, and you continue a little cooler.

But It was not fixable. And so, and oftentimes when it's very cold at times, and then the fix sometimes makes it then extra hot. And so, it makes it rather difficult because we have to move people around and we have groups that reserve our spaces. And so, the Learning Commons was one of them that was in the '90s. And so, I don't know if we lost it, they couldn't be in the room.

And, you know, in one case, we ended up moving a group to the Wilbur Marshall Theatre because it was open and available, and it fit their needs. But those are some of the challenges that we're working through. And I think I might jump in to say that I think the library is going to be one of the leading new instantiations of a new thread of conversation starting in this budget season. And it's the culmination of a lot of different threads. One is, at any given time, it would just be good to have a good handle on costs and how to keep them efficient.

In this particular time where NSTAR is saying we are concerned that we are in a crunch this winter, the vector sum of having Margie's office be 94 degrees in an era where we are trying to conserve gas is intolerable and a waste of money and generally putting the community at some risk. The third is just our general deferred maintenance story that we've always been telling. These HVAC systems are all very— not the kind of controls that we would like to have, even if they were operable, if we could manually adjust all the louvers so that the heat zones were all correct. These systems that we would really like to be able to manage the buildings efficiently. And I will also say that we are trying to do a better job of benchmarking our facilities against like facilities.

I've had some sales guitars with some different control entities, but just by way of example, we had one company who was part of a sales pitch said, I've taken a look at your energy costs at various facilities, benchmarked them against them to national standards. The LUSAC library was in the 98th pile of energy usage against similar facilities. That's not right, right? We should be able to do better than that. And so part of the PIS bond package is to take care of that old legacy business to save us money in the long run, to help with our gas prices that we aren't funding people who reserve the third floor of the library because we can't keep it from being a sauna today.

Okay, any further questions? Miss Scout? I think just excited to see this and to see us, um, focusing on energy efficiency work across the muni. And at the—. I'd love at some point, um, to learn more about the projected cost savings with these energy improvements as as well so we can balance out the capital.

Thanks. Okay, any further questions? Checking online too.

Okay. Thank you.

Okay, I have one just to start as folks are looking through. Can you point us to— I see, I'm looking in the actual budget book and I see a list of projects. Um, can you— our potential CASA projects, if any of these on this list are that?

I was going to say, through the chair, um, none of them are as far as I know, because CASA is a separate service area than the Parks and Rec service area. I'm not sure if this was department or service area. Okay, so this is service area. That's helpful. Okay, there are questions.

I guess I do have one question then. So given if it is a service, we have $500,000 for the Anchorage Memorial Cemetery. We all love the cemetery, we want it to be great. At least I'll speak for myself. That is also an area-wide service.

So can you speak to that just a tiny bit? Correct. So cemetery is an area-wide service, but it is maintained and operated in the Parks and Recreation Department. So cemetery would be on the area-wide bond by Parks and Recreation. So Parks and Rec does both their service area work and area-wide work as, and as funded appropriately, ideally.

So that's the, that's the difference there between cemetery and why it is in parks and recreation's list. They're all bond, but they are from different fund sources, if you will.

Okay, thank you. Mr. Perez-Verdia and then Ms. Bowman Day. Sure, can you just say Park project?

Through the chair. So Ken Kavey's just kicked off the master plan. So this is building up to address any of my needs from the master plan. Most likely, I think our first approach will be circulation around the chalet.

Thank you. Okay. Miss Baldwin Day, that's right. Yeah. So, um.

First, I put everybody on notice that this is the last time there will be no Parks and Rec projects in Midtown on a bond. Is going to change. And then I think I have a question about a project that's on the edge of Midtown, on the edge of District 4, which is the Goose Lake Park improvements. And looking at the sort of the— it looks like we're anticipating bond funding over the course of the next 3 years. I'm wondering, where are we starting with that project?

Do we already have a master plan? Are we doing a master plan first? What's for Goose Lake? Through the chair, can I confirm you said Hillstrand? Goose Lake.

Oh, Goose Lake.

Through the chair, we are currently finishing up our public outreach portion of the master plan, and we're working on a draft of the Goose Lake Park master plan. We have, if you could check the project website, I do believe that there's some site concepts and drafts of what the community has decided. We hope to go zoning in the spring for final approval, and we're really excited. I want to celebrate that the planning team threw a beach party this summer, and we're really excited to see that park invested in.

That is like, is near and dear to my heart from like childhood, so this makes me happy. Do we have an idea? It looks like construction is scheduled. Is that what we're anticipating based on sort of the way that this funding looks? Typically for our master plans, we identify it's a 20-year plan, And we would identify priorities, and then the priorities are phased as we— because we have needs across the city and we want to balance the investment across our city reasonably so.

So you'll see that many of our master plans have investment throughout the 6-year outlook. But with Goose Lake, there is ideas to improve the facility. So that's why we're planning out, projecting into 2030.

31. Apologies to folks on the phone, we're having some echo. It was just weird feedback issues, so we're trying to work through that. Other questions? Oh yeah, that's right, Mr. Volland, go ahead.

Thank you. Why I have— perhaps this doesn't need to be a year where there's no Midtown projects. Might suggest that look through binder and see, because we have the CIP, right? So you can shift things forward in years. We've done that in the past with, um, I've supported our members Zolotow and Rivera to move forward funding, um, for the Cutty Park Chalet, for instance.

Um, also I'm looking through the binder and In the descriptions of the project, so for instance, Mountain View Community Center on page 39, and it says District Assembly Section 5 East Seats H and I. Is someone explain, is that how that should read, or is that meant to say the Assembly District and the assembly seats?

Because I think that might need updating. I'm wondering if this is a carryover from before reapportionment.

Through the—. And check on it and correct it if it is wrong. Yes. Okay, because that's— yeah, Mountain View Community Center, of course, is in District 1. My seat is, I believe, in B. Sydney Scout.

Okay, I think that's—. Probably. Well, let me, let me ask. We have both the North Anchorage reps and the Midtown reps have heard a lot of support for the Cutty Park Chalet. And then I've talked with some of the parks in the past about that project.

And I kind of just want to get your take on where that is. And also, how much do we know how much money is remaining that would need to be raised for that project? And maybe just also a general update on Cuddy Park? Through the chair, so we are currently working on drafting an RFP to do a master plan for Cuddy. So that is why you don't see Cuddy, um, the CIP right now.

We have money on hand, quite a bit of money on hand, and so until the community actually identifies their priorities, um, that add more money on if we need it. Great, I appreciate that. Um, interesting to think about how the sequencing of a master plan project, because I think you guys are also going to be doing one for the West Chester Lagoon area. I think you already said Goose Lake. How that intersects with projects that the community has already supported, you know, voters have approved a bond that included a project, um, make sure the will of voters is honored when those projects are funded.

And, and, you know, I think what I, what I would not want to see happen is that we do a new plan— oh, never mind, this plan went in a different direction, and we're so not going to do this project anymore, even though voters have already supported it.

I would say that I'm very proud in our department's ability to go through a very very transparent, drawn-out, and public involvement process at times. I'll say, but, you know, Muldoon is one example where we fast-tracked that and got a great thing for the community, Chauncey Muldoon Park. So when we go through the planning process and we're able to engage multiple groups, I feel confident that that's what is the will of the folks, will of the people, will of the community. And I think that part of that is the voter-approved bond and the thing that was identified there, but that's like 2 sentences, whereas the master plan oftentimes a long document and identifies a long 20-year plan. So I would say that what you were describing is once, and the master plan really helps illustrate that over time and space.

Can I follow up?

Is—. I also think you guys do greatly that for the record, probably more than you need to do sometimes. But is there a world where voters could approve a project now multiple times, process could come along, and then we say, actually, no, we're not going to do that project anymore? And like, what would be used as the justification for that? Because one thing in this conversation came up when we were considering a sales tax proposal.

It was the one, but the previous, the Project Anchorage, or Choose Anchorage, or whatever it was called, where there was a list of capital projects that were put forward, and we said, you know, we're going to use this percentage of the sales tax to do this list of 10 community-nominated projects, and there was a survey that went out.

One of my concerns at the time, when we were considering that, was like, well, you're talking about something at Weston, have you talked to South Edition? Because they're going to have some thoughts and feels about that. And I think that there is a dynamic where in some of the planning processes, it's more stakeholders, folks who live proximal to those projects, and maybe not a wider geographic representation.

And sometimes I think those things can kind of rub up against each other where we say, area-wide voters, but in a planning process, those who may be more likely to participate, folks more proximal, they might have a different take on that or a different opinion on that. And so what would— I mean, I guess, how would you be looking at that as you start this new planning process, but knowing that at Cutty Park Chalet bonds has had broader community support.

Through the chair, Director Robbins, Management and Budget. I will say the thing that you are explaining is the tension between funding and public process in terms of if voters approve a bond for a master plan and then the master plan is changed through the process that the original master plan was made the need for that bond to go forward. Where is the line where you say this one's okay, that one's not? If the public has voted and the process in the whole time, then you have followed the process, the public engagement has occurred, the feedback loop has completed. It's if we are putting our hands into the middle of the process, nope, not this way.

I think there's a different sequencing on this.

Example, the example, the funding, and all this through the lens of, you know, as an assembly member amending projects. I don't want to be promising something to voters, to all of our community councils and say, giving us your priorities, you know, we want to make sure that we elevate those. But knowing that they might not come to fruition. And so in this example, that project was supported before folks knew that there was going to be this new master planning process for Cuddy. And so it's actually then kind of a reversal of supported potential if it ends up that way.

I mean, maybe you do the planning process and people are like, yeah, Cuddy Park's like great, but that's what I worry about. And I think my question would be, how did the— if it wasn't part of a master plan assembly amendment, so, so that is an assembly action that the normal process and treated it differently. Because if we had been going through the master planning process, that project would in the master plan and then gone into, and then it wouldn't have created the need to make them. I mean, do we know that there was going to be a master plan update? I think that's, that's all part of an understanding of what the actual process is and where we are in the time.

I understand, I understand what you're saying. You do not want to have members is to say, okay, in the next 5 years, which parks are going to have a master plan update? And we maybe ought not to amend to support certain projects knowing that this is coming. I will defer to Parks and Rec on that, but I will say I believe that's one of the reasons they do it in a slow, distributed fashion, because if you can do it cheap, fast, good, right, any of these 3 things push on the other one. And if we want to do something fast, it's probably going to be kind of expensive and we hope it's good.

But planning the way this is distributed in a world where we don't have enough to do any of the projects all the way across the Long Island Railroad, it is a slow process, which means that those plans will change in that timeframe. So if we speed up the process, it's going to cost more money. But you can make it go faster. And so it's all a trade-off on dollars and time. And where can we actually make sure that we are using both of those the most efficiently?

Because they are what we don't have. I appreciate that. Yeah, I think that the other interesting thing about this one is there's been private dollars raised for this too. And so, you know, myself and former members was to catalyze that. And so, yeah, I just kind of want to have that conversation, and I, on the record, vote that I still have strong support for that project.

And you may—. I believe there are other members who feel the same. Okay, Miss Baldwin Day, then I myself, and McKee. Yeah, thanks. Similar lines, although while I share Member Rollins' enthusiasm for the cutting, I actually think that one of the benefits of the sequencing we're contemplating now is to avoid a scenario in which we build something really ambitious enough.

And I, and my concern, at least individually, with the plans that I have seen for the Cuddy Park Chalet is that relative to the utilization of Cuddy Park, I think it is a— I do not think it goes far enough to serve the community and the future use of Cuddy Park. And I would personally like to see more community input from beyond the circle of folks that have been committed about the Chalet, which to be clear is very, very narrowly focused on skating and winter utilization, actually serves the broader community in a year-round fashion, and that could support larger events, larger user groups than just what to date. And I think that that's the genesis for my enthusiasm for the master planning process, because I really think we'd be making, if we funded, a teeny tiny little chalet with like 2 bathrooms in it, when we had the opportunity to do something much more robust for a park that is like literally in the heart of Anchorage. And so, hope to see a Kuti Park Chalet come forward. I hope that it is actually bigger and more expansive than what's by folks in the community.

So I, and I feel quite confident that if we were to consult folks in Midtown, they would probably have similar feedback. And I did for the Master Planning Project precisely because I think it prevents us from investing funds that we might later regret and say, oh, I wish we had spent a couple more million dollars and gotten a few more bathrooms out of the deal, as opposed to, you know, doing something small because it felt expedient.

Thanks. I have a question on a different project. The lack of a master plan for the port from a few years ago is why it took an extra 3 years for us to get an actual plan of finance. And we'll also say there's other contexts that lack of a master plan has gotten us in some hot water. Anyway, totally not related to parks, is the coastal trail.

I was wondering if you could speak to that. And then I also want to preview, I think, issue. I know this is definitely not enough money to do any much about that, but I'm curious, like, what is it doing? And then I also want to just preview that I bring some kind of amendment— I'll talk to the folks offline about it— to make this a state request as well. So probably not instead of this, but I think it is there if this is about Point Warnsorf.

And I know that that is a whole long conversation that's happened in the community for at least a decade. Project, at the end of the day, that the FAA, uh, has costed us 10 years ago. So anyway, just curious, so specifically what is this about and how does it fit into the big picture? You are correct that it is about Point Warnesoff and the, the bluff is now encroaching on the area where the trail is. So this is going to go towards realigning that.

We had a meeting with the, the airport, not with the railroad, on a different project. Excuse me, with the airport and DOT essential process for that. So I anticipate we will need more funding, but it is unclear at this time, and this is a safe amount to be forecasting out. Thanks. Yeah, and again, just a preview that I intend to bring an amendment, so I will speak with staff offline, working with state representatives and just kind of figuring out what that should look like at the state level.

Thank you. Any other questions? It's also—. I think we can keep going. I would like to add that the sort of Diversity and depth of the park bond proposal is more than traditional bond package, but that is part of the investment in sort of the recreation economy.

Parks and Recreation is not a service. There are pockets of the municipality that do not pay into even though the access to the parks is open. And, you know, Chugiak, Eagle River have a separate division that does it but is operated as part of the MOA Parks and Rec. One of the questions is, should this be a different kind of service area? That doesn't mean that Chugiak changes theirs, but do we change ours?

Should—. Is that service in the service area or in the residents that are paying into it the appropriate— are, etc., etc. Right, okay, thanks, Dr. Mack.

As folks are moving on, can you clarify what the 2026 bond amount was? And then this one is $11 million, but I'm seeing $8.4 million for the bond proposed right now for Park. The $11 million is the total capital budget, $8.4 million fund source proposal.

Okay, next, sorry, public transportation. Public Transportation. Director Rudolph is here with us from Public, and he can give us updates on what these specific capital programs are. They—. One is an annual program.

Is the second one an annual program as well? That's the recurring capital project for Fleet Transit's house. So Transit has a 17.5 million capital budget, but the majority of that comes from federal dollars through the FTA, and 2% total bond request for 2027.

Any questions on transit? Are those matching funds? Yeah, through the chair, yes. They are, depending on how you use them, they are an 80/20 match. So if you use them in a different way, they are a 50/50 match.

So we use them in the 80/20 way. Okay, other questions? I guess I have one. I'm not seeing named here, but maybe it's in here, the Transit Center improvements, or is that kind of in that first one? Because I know that is an annual program, but where the, I guess, Downtown Transit Center project is generally, uh, through the chair, the Downtown Transit Center project, the center project is not included in this bond.

It'll be in a future year bond. Okay, so it's essentially funded right now up to the point that we need it funded, and then it would come back in a future year? Yes, it's funded through design and engineering that would come back later. Okay, thank you. And with apologies, this is one of the late on the table items for Tuesday, is the design contract for the downtown transit center.

Okay, for folks, you'll see them in your inbox at some point. Other questions from members on the budget? Baldwin Day. I'm actually curious how the transit facilities centers and bus stop improvements, how are those? How do you decide which ones need attention or which bus stops need a bench?

How does that look? What's the peek behind the curtain? Yeah, Chair, that's a good question. So we have a bus stop Distribution Amenity Guidelines. What are the thresholds where a bus stop gets a bench or a trash can or a shelter?

And it's largely based on ridership at that stop, uh, to available right-of-way. And then we go to space available on the existing sidewalk. So it's kind of a 3-layer approach on how we determine that, but highest ridership stops first, which is what we're doing. We're filling gaps where the highest ridership stops. And then we go back and then we replace amenities that are past their useful life at the stops that exist now.

And this might be an— so is, is the— is placing trash cans part of this pot of funding? Yeah, the purchase of the trash can itself is, yes. The maintenance is Transit operations? Yeah. Okay, fascinating.

The staff that empties the trash cans, yes. Got it. How flexible is that list? I mean, if there is, let's say, for example, a town with no trash bin that has, hypothetically, that always has a pile of trash at it, is, you know, I think this is useful for bucketing projects together, but it also makes it difficult. Difficult to know how we can intersect with that sort of rubric that you've got going.

We do. So we have a list on our website that shows where we plan to add amenities in the next 2 years that stops. And then we also have a form that people can want an amenity at a certain stop. So they can fill out that form and it gets routed through our department and then we address them. Those are the ones that are kind of the one-offs.

I did not, so thank you. Yes.

Do we have it? Okay, we, uh, we have a chief acting time limit vacancy.

Okay, yeah, I don't know if your timing— yeah, I think maybe we could swap. So because I know we have fire chief here So let's do fire and then we can come back to police. But I'll also just note we're getting into the big ones. So, well, not all of them are big. Police is not very big.

Fire is a little bit bigger. And then we've got maintenance and operations. And then of course the biggest one, project management and engineering that I know we're all waiting for.

We'll figure it out. Hey, the fire department proposed capital budget. This is going— this includes part of what we talked about at the very beginning of this day, the bond request and associated O&M and how they're together and requested of the community, et cetera, et cetera. This also includes our traditional bond, uh, for annual ambulance replacement programs, the fire apparatus replacement for water tenders, and requests for replacements for fire stations that are in the design process. And Steve Shruggie is here and can give us lots of information about all of the demand for these projects and what it— but the additional ambulance unit for 300, at the top of the list, is proposed as an asset purchase for a bond of $380,000 as a $1.6 million O&M increment to operate the ambulance.

Is not replacing the ambulances we currently have in service, which is the next line item, $800,000 on an annual or recurring basis as appropriated. An expansion of medical service to provide more coverage for the demand, and we do not have the revenue to the expansion of that service. So creating the option for the fire service area to vote on— or sorry, not the fire service area, the emergency area-wide area— to vote on expanding services and having an additional ambulance available is, do you want to have more service and faster response available, and it's packaged differently, but it is the same operation.

No, through the chair, every, uh, our bond questions come with the bond question, which is capital, and the associated O&M increment, which is not capital. And so it's a challenging, uh, sort of The separation here that we have to bridge our traditional language. We use bond as a term to mean things that it doesn't actually mean, and a financing mechanism that allows for a specific kind of funding to be used. But it's not the only— in our bond questions. And so when we have the O&M increment that's added to Parks and Rec for 37 cents on the bond question, that is an operating budget addition financed on a 20-year basis.

It is an annual levy every single year. O&M is an annual levy, a bond is the capital financed package. That is exactly what this proposal is. It just involves the humans that operate the ambulance. This is different than how we do our capital projects right now.

We pay for project managers and engineers and people to build asset, which is the same kind of cost of operating the capital asset if the asset has an operational component. The question becomes, do you want to bond to pay for this ambulance, and do you want to levy to pay for the service to drive the ambulance? Because if we ask the asset question, we do not have the staff or the funding to make it work.

Miss Bowman Day. So if I'm seeing this correctly on FD4, we're saying, hey, $380,000 for an ambulance. Which is the one time, and then we're saying alongside this, we're going to fund a levy essentially on an annual basis, 1.35-ish million to staff the thing we just asked you if you wanted to buy. Cool.

And I think for clarification, I think we've maybe not, not any of us up here, but we've done this before, I believe, with at least one of the fire trucks in this department in the past. I think there was staffing attached to, or some kind of staffing attached to at least one of the engines that was purchased. I would say ish. And I think that we have thought carefully about this history. And I think we want to be real transparent that this is going to be a service level area question.

New business that we think we should get in because circumstances have changed, the call volumes in this area now warrant the fielding of a new crew that is not there now. Do you want to buy that? So there are certainly analogs, but I think we'll be doing it in a slightly different form this year. Okay, thanks for the clarification. Mr. Handeland.

So for the bonds, we have those where it's set for a set amount of time there for that. Is that also with the, the levy where once the ambulance is out of service, the, that drop-off, or is that forever? Through the Chair, it would depend on the language that's used in the question, but I would assume, and the Chief can operationally, what would happen is we would ask the question about expanding the service available within a medical— say yes, we add the ambulance to the asset list, it goes into the replacement program with all the others, but the increment to add applied to the area-wide service area As long as the question allowed. So you could put a time limit on it. Your question has to come back 5 years, or it will be retired if and when this ambulance expansion goes out of service, right?

So you can tie it, but it depends on how the question is asked. And then the other question, how does this impact the Chugiak Volunteer Fire Department? Because they are in area statewide EMS. So how would this impact them?

Thank you for the question, Member. Doug Schragi, for the record, Fire Chief. I'm joined today by Diana Lopez, who's our principal financial officer at the fire department. Thank you for the question. So every day we have 18 ambulances on the road throughout the municipality, from Portage all the way to Ekluta, operated by the Anchorage Fire Department.

And 5 operated by Chugiak and Girdwood. But we aren't confined to just responding within our areas, so the ambulances are considered area-wide assets. If there's a major vehicle wreck or cardiac arrest or whatever it is anywhere in the unit, could go to those calls. If a Chugiak ambulance is transporting a patient to Providence Hospital and upon leaving the hospital they happen to be the closest one to a medical emergency, they would be dispatched to that area-wide system. What we're proposing to do is, in recognition of the fact that the entire system is under strain, including— is to put an additional ambulance, an additional staffed ambulance into the system, which would provide relief effectively to the entire Does that answer your question?

Through the Chair, it helps. It helps. It provides additional revenue to the specific service that Chugiak is providing, and right now you're limited in a separate way because of the fire service area and the funding available under that. Because medical service is an area-wide cost spread across differently, it benefits Chugiak in a way that if we added even more could and would end up supporting Chugiak response. Yeah, and I understand that aspect, but I mean, I'm assuming for the vast majority of calls that are at the Chugiak Volunteer Fire Department is going to be the closest one for the people that are residing in that area.

And so with, I guess, bonding and stuff for this where it's like, okay, how are they, I guess, being benefited from this? Because I don't imagine there's a whole bunch of ambulances from Anchorage that are coming north to service people out there just because the distance on that. And so, I mean, maybe I'm wrong on that. Through one of the things that's happening in this budget proposal is that Chugiak and Girdwood are getting additional area-wide funding increases. Anchorage is decreasing their area-wide funding, and if that funding goes up, then the available area-wide opportunities for Chugiak and Girdwood increase.

So it gives more opportunity for funding to go to the places that are constrained, just like us, and it, I don't know what, it helps balance the system more. We currently are, I think. I can offer an example. Go ahead. Uh, through the chair.

Thank you, uh, member. Uh, so this kind of thing, not the specific example, but this kind of thing happens almost every day where maybe the Chugiak Fire Department staffs their ambulance and they are going out Eklutna, somewhere in the vicinity of Eklutna on a patient. Another ambulance call occurs in the Chugiak Fire Service area within the area-wide EMS service area beyond the boundaries of the Anchorage Fire Service area. Medic 11 from the Eagle River Station will respond into Chugiak's area. Station 6 in Muldoon will send an ambulance out to Eagle River.

So, so increasing the total capacity of everybody from in every corner of the municipality. Yeah, and I get that. I'm, uh, yeah, fully, fully supportive of that. The geographic, uh, constraints here and stuff on that, like when you're looking at Midtown town, adding another ambulance, okay, someone be able to normally be a minute further away to, to be able to respond to that. But when it's out in Tukageel River, I mean, anything that's coming coming from kind of the Anchorage Boulder unit, either at Fire Station 12 or 11 out of Eagle River or in Chugiak, they're not getting as much of that benefit there.

It's just kind of my concern. And we can move on. Sure, quick follow-up. Yeah, that's a good observation. One of the reasons that we've identified Midtown generally for this ambulance is not necessarily necessarily because there's a greater number of calls in that area.

The Midtown ambulances go to more calls because they are second in this area that surrounds them. They're literally surrounded by Station 6 and 5 and 11 and 12 and 14 and so forth. And so, puh, those are, and so we haven't been specific about where this ambulance will be located, but we recognize that it needs to benefit the system in whole.

Thank you. Thanks. I just have a quick follow-up with that, and then Mr. Bowman, is it also the case that if we have a road responding to calls, it's possible that we would have a marginal increase in SEMT revenue, essentially reimbursement? So, but I think to the extent that that is a revenue-generating or reimbursement-generating service, it is possible that some of that would get offset?

Is that an accurate read? Thank you for the question, Chair Brawley. Generally, no, because the calls, if we take a snapshot in time, we're going to go on the same number of calls today as we go on tomorrow. Tomorrow we have one extra ambulance distributing the same number of calls among more units. What we're going to do is we're going to increase the availability of every other unit in the city.

Because there are many times throughout the year when everyone's on a call. And when they're on one call, they're unavailable to respond to another. And so the short answer is no, that's not going to increase SCMP revenue. Yeah, thanks. That's a good distinction.

And I stand corrected. We were joined in the room by Member Park again a few minutes ago. Mr. Bowman. Thank you.

I might be jumping ahead a little bit here, but yeah, I'm really interested in this.

And it makes me think of the, you know, the National Fire Protection Association recommended rig.

I'm wondering, looking ahead in the binder at the fire engine replacement, Um, the other's, uh, programmed here for 2028. Uh, I think, um, I guess, how are we doing on getting 4 to a rig? And then, so similar sort of annual replacement approach that comes along with staffing, a way that potentially we could move in that direction? I can answer that from the budget perspective, and the answer is yes. And I was actually going to say that while the Chief was answering that last question.

This is because we do not have the capacity under the operating budget, under the tax cap as it is right now. And we are experiencing, you know, burnout, OT through the fire department, etc. All those realities are part of why this question is this way. It also has to do with the service level budget and to the community understanding what they're paying for and are you getting what you're paying for and what you want the community to be doing. So to Perez-Verdia's question earlier, like, what are the benchmarks?

What are the core services? That service level conversation is part of what all of that is because to the municipality as an organization. Core service of, you know, France could mean something very different than what the community wants. And if they are willing to pay for a concierge service, then we can provide it. Understand what that funding is required, what the sort of operational components of it are and what the outcomes are, which everybody say it with me, are what PVRs are about.

Because they are the metric to measure whether the goal that you are setting with your budget— the challenge is if that PBR metric is not established based on the funding level and outcomes, then it doesn't connect. And we can't necessarily say that our PBRs are tied to a fund— they are tied to a current budget required benchmark because that was what we said we were doing last year. And we have not— or really have the longevity of history in front of us to say, oh, actually, we used to pay in the operating budget. The engineers who do our project management and engineering, those used to be in the operating budget. Fleet maintenance, the maintenance and operation used to be in the operating budget and the capital budget was a supplement to the actual asset.

We pushed them all into bond funding and capital funding and funding because we can't afford them in the operating budget. And when we make these choices and do that 10 years ago, it changes the conversation today because now we don't even know that we used to have them in our budget. But that's where they were. And that's where they— those are the operating requirements of a municipality of this size. With the demands coming from the community.

Chief, on the 4-to-a-rig best practice recommendation, are we making progress on that? How is that going? What's the current status? Well, there's been no meaningful change in our staffing in the past few months since we've last talked about this. Recognize that the desired end state is to have 4-person staffing on all of us.

You know, there's—. That's a distant bridge for us to cross, but something that I think we're all interested in working towards. Thanks. Yeah, I guess I would just say I'm at this mechanism can be a little more ambitious and broader as we bring potentially this before voters to include not just ambulances. And what is the administration's plan Ona Brause, for having that conversation that you're talking about, Ms. Brause willing to pay for.

Is the plan to gauge that via this upcoming ballot, or is there some type of survey going to go— type of communication, coalition building? What's that going to look like? Through the chair to Vice Chair Volland, yes, all of those things, right? And that is their— this process, this conversation, this input is going to take us the next 6 to 12 months at a minimum. There are other things that happen in a cyclical— in a cyclical cycle.

Yikes.

In a cyclical system, we have to go through the entire cycle to actually onboard those changes, right? Our budgets in a cycle, you can't put your hand in the middle of it and expect to know what you're doing here or here. Because you don't know it yet. And so we off-budget. This is the idea generator, the thing that we can discuss to say, how does this sound?

Do you like this idea? This is an interesting new proposal in response to community demands. And the reality of having a responsive government means that we are responding, and it is either an emergency, a demand, a sort of need outcry, And we are talking about an operational demand for the entire community and the services we provide. So understanding and knowing how to respond, this is, this is what this whole thing is. Do you like this idea?

Does this make sense to you? Would the transparency associated with service level budgeting that gives you an idea, pay X amount of dollars and you're gonna get this level of service. And when you don't get this level of service, You come tell us. They already tell us now, but there is for the expected level of service. And, and it gets very challenging when you— and we are faced with those questions of what do you mean you can't do that?

And, and this is specifically designed to have the conversation about providing the service for and not staying the way that we have traditionally done our our process, our financing, our opportunities. In the world, this is a normal funding process. It is just not what we have done here because of our funding constraints and the way the tax cap has historically worked.

Susanne Fleek-Green, through the chair, mostly Director Brause. Question, but I think this is one that we talk about too, and I guess I'll just remind everyone that the Apple program and specifically bond packages is not a science. We obviously want them to pass. We don't know where the capacity is or when you're going to hit a threshold when voters are like, nope, too much in a year. Director Brause said we have been hearing and certainly understand that we are at a critical department in their ability to respond.

Don't forget, we are a very large municipality. We have a lot of space to cover. So like you said, sort of a testing before we think, oh, we're going to grow this bigger. And I think, again, it's transparency with vote. You are asking for things that we currently cannot provide with our regular system.

How else do we address concerns and your wants? This is an avenue. If this— or say, yep, we are investing, then I think in future cycles we would think about building on top of this. We'll also say that I have now realized why we don't do capital before operating, because many of these things feed into the operating conversation. The fire department is a very good example of something we are doing with our very large municipal departments that cost us the most money and frankly, demand put on them from the community.

We are working through the org chart, making sure that everybody is assigned in the right place. We are working through the overtime demands and what all of that means and whether or not positions can make a difference or if management lines make a difference. How do these— We are talking about the way these capital projects coming about, whether or not new stations need to be developed, because the robust nature of this conversation, the demands on the fire department for fire and medical response have not happened because we have a lifecycle planning problem. We only look 3 to 5 years in front of us. We do not look longer than that.

Over, as we talked about in the beginning, of the people doing the work work creates this restart. And that is a problem. It is a reality. And so we have to figure out how to deal with that. And there is a lot of happening within the fire department, the police department, maintenance operations, many of our large departments, as I said, that will come through in the next 6 months, either reorgs or OT decreases or increases, essentially true-ups to funding levels and actual overtime.

Transit in particular has a very sticky case, right, in terms of how their OT is consumed and whether or not additional positions funded would help them in that efficiency. So we are getting down into the nitty-gritty of what do we look like when we are providing modern services in a modern way. Okay, thanks. Yeah, and I'll note the SAFER grant, that is another relevant part of this conversation. I remember getting briefed in December 2022, so definitely a multi-year conversation, and we do know that grant runs out.

So we are at 3:46. I am attempting to manage the fact that I have heads in the back who have been sitting waiting patiently. We have definitely more content that we can cover today, and I am going to strongly suggest that we cannot push any of this to the next week because we will run out of time. And so I guess the following, I know it's been a long day already. If we can go to 4:15, I know it's already a little painful, but we can use our time that way.

And then I guess I'll look to best, we actually skip the police one because I know that's gonna generate probably a whole world of questions that are operating questions and not capital. I suggest, I guess I'll turn to Ms. Brause and see, we have basically maintenance and operations, which is all of our facilities. All of that could generate operating questions, but that's not the time for that here. Project management and engineering courses, all of our road projects, Lisa and Arza and others, and then traffic engineering. So what should we prioritize?

Would really just be a real quick through all three. I'm just following day.

OK, before we do that, we need to figure out what we're doing for the rest of the day. Fire.

So because I want to give expectation for folks sitting in the back next week, probably.

Yeah, I guess I know, I know, so we're kind of talking offline. Roads are a big part of our capital budget, so it does seem like we should cover them. I don't know, I guess do folks have a preference on what you'd like to cover? I have to leave, I have to leave at 4, and but I would, yeah, push the roads. Okay, yeah, so maybe that's what we'll do.

And again, knowing that we're gonna— it's gonna be competing with all the time for every other department, but let's cover maintenance and then traffic. Okay, yeah, and then again, we'll save police for next week, and then we'll finish up in the meantime on fire, and then we will end at Yeah, all right, thank you. And so Miss Baldwin Day, question for fire. Yeah, I think my questions are asked just a moment ago about bonds, and it's particularly about the language that we're using on these, on the bond proposition specifically for fire station replacements and for new stations. And so I'm curious, you know, this 2027 funding for Station 11, Station 12, and Station 13.

16 New, is it going to be that this is for— this is for planning, this is for land acquisition, this is not actually for replacement of a fire station yet? Like, is that— or unclear when it comes time to—. Certainly should be. And you can help us make that happen because all of this budgetary process will turn into the balances that you will see in late December, January. Okay, so we can workshop that.

Ballot language together. Excellent, because I could see there being a real tipping point where people go, wait a minute, I thought we bonded last year for new Station 16. Why are there— why are we doing it again? So noting that it looks like there's going to be a huge bond in 2028 if we're actually going to build 3 fire stations in 2028, just throwing that out there. 10 Water Well, that looks like a relatively small project.

Why are we pushing that out to 2030?

I can respond to that. Yeah, thank you through, uh, Member Paul Dondé, through the chair. Uh, yeah, in the totality of all of the things that— of our many needs, we just felt like that one, the well at Station 10, has been underperforming for a decade or more. And we deliver bottled water there every week, and that's what they drink. And just the other things that are before you between now and then are more urgent projects.

How much do we spend on bottled water for Station 10? I think it's about $5,000 a month.

So call me crazy, but it feels like we could spend $100,000 sooner and not spend $60 every year better. Oh, that's for the whole year. Okay. I think I'm being corrected. $5,000 For a year.

Okay. Well, that changed. Okay. Yeah, that seems like a lot. I'm not going to question it.

Okay. Yeah, I think, I think those were, those are the two things I wanted clarified. So thank you. Thanks. And then I have myself in the queue.

Just a brief question. Where you have told me this at a prior event, where generally would Station 16 go? Like, what gap is it filling on the map? If you can— on the little tiny map, that's the second picture down on the slide, you can see the lavender-colored areas where we are not meeting our response time targets. The ones up north are Jay Bear property, so we don't respond there anyway.

There's a little bit area where the international airport is. These areas are the ones that are to the left and right of the Seward Highway on either side of Station 12. I think, and so what has happened is we've only, we've a net of one new fire station in the entire history of the municipality. Since 1975, we've added two stations, but taken for an increase of 1. And what happens is when those stations were built, Station 12 was the old water utility building.

We bought it in 1980. Those areas to the left and right of the Seward Highway were not filled in as they are today. And so now those areas are full of businesses and residences, and we need to better serve them. So that's the long answer. Station 16 would be to the west of the Seward Highway along the C Street corridor, somewhere between Fox Ridge Condos and roughly Potter Drive.

Design study would help us identify the precise location. And then part of the calculus is that Station 12 would need to the east to serve the residents around Elmore, Laurel Road, and Abbott Loop— or Abbott Road. So essentially where we've built additional subdivisions over time Bring Clatt Road, Southport, that kind of area seems to have been built, or maybe not quite that far west, but down that way. Okay. Okay, thank you.

Mr. Volland. Sorry, I came in, I think, when we were describing that a million and a half in bond revenue for a design study for the new fire station. Is that what is being proposed?

Yes. Okay. It'd be the designs, the 35% design. It'd be a response area study, which would, you know, they would calculate all the road impediments and figure out where the best, where the calls are the best to locate it is. And then also where the Heritage Land Bank has property that we can acquire.

Great. Thank you. Um, something I would still love some clarity around after this job is design study versus planning effort and like what the differences are, because I've heard in the past, you know, you can't bond for a plan or a planning study, which— or a design study. And so, because I know like, for instance, um, we just— we bonded for the cost of the, I think, 2025, which are parking lot design study, and then last year for the construction. So would love just like maybe a run on that.

Through the chair, I think that is in conversation for the assembly particularly, but I— one of the things that has changed on the administration side is that we have a different bond counsel, new onboarding into how the municipal process works, sort of an expanded opportunity to understand the rules around all of that. I don't think there was a problem in, in figuring out how to identify the specific question you are asking. I don't know the answer to that right now.

Okay, um, so I think we're good with fire. Thanks for being here. Um, and then as I said, uh, just we are going to skip over, uh, excuse me, project management and engineering as well as police. We will come back to those next week in the context of operating budget, but also for PM&E, we'll come back to. So I think next we're doing traffic engineering, is that right?

So I'll invite our traffic engineer up, and then I'll turn everybody to page 60 since we skipped around a little bit on the slide.

Okay, so Director Quinn will answer questions from traffic engineering on the projects and how they they use this funding, but the 3 projects being offered during bond funding are the annual programs associated with signage maintenance and the school zoning and safety improvements. These dollar amounts are significantly larger than the last. I think when in 2024, maybe the amounts were $500,000 and million, and then in 2025, the region and the assembly increased them because of the need and demand for this work to be done. This, I believe, is another increase on top of last year's, specifically to consider deferred maintenance that is the condition of our community. And Director Poi can answer specifics.

Before we go to specifics, did you have additional you wanted to add before before we go to questions.

I think one thing to add is that the way we run our program is, as the funds— then do a design one year and build the next year. So, so this funding is what we would use— design that would then be built in 2028. So that's how we've managed our rolling so that we can make sure to hit the ground running each summer. And just for historical context, I've been here long enough to remember when Traffic calming was only $500,000. We ran an amendment to increase, so thank you for increasing that further.

I think we doubled it at that time to $1 million and discussed as a big deal but ended up being small compared to this. And then also note for everybody who gets requests for speed humps, traffic calming, that is this line that it comes from. So with that, Mr. Volland, thank you. Yeah, I was going to say what I would love to see— how you all feel about this— Will feel about this, but I think with these programs, it's very important for us to be able to communicate our various constituencies. You know, you're going to get your speed bump because you're in the program.

So I don't know if that's like a thing that we could increase, for instance, like the Traffic and Calming Program, what that— the qualified list is and the ones that you're working your way would be kind of awesome. And then we can explain that to our constituents. Through the chair, I will say that, and we have started down the path of researching all of the historical bond appropriate was spent and whether or not the projects are completed, et cetera, et cetera. That will take a very long time as we are an office included and the demands associated with that level of research can be very challenging. But we have not— we've just— so we're thinking in the same sort of line of We not only want to ask you, are you okay with us doing this?

We want to tell you we did it, or we want to tell you we're going to do it, right? And some of that has to do with the limitations on staff capacity, full stop. We just don't have enough people to tell you we're doing the work, and that is a real mistake in public process. If I could follow up, yeah, thank you for that. Will you send us the qualified list on the Okay, and then what else was I going to say?

What? You can come back to me. Next, Ms. Scout and then Ms. Bowman.

Yeah, echoing Vice Chair Volland, would love to see that list. We get a lot of questions. One thing I'm wondering is alleyway paving included in this program, or is that somewhere else?

That's street maintenance that has alleyway paving, I believe. I guess you can answer that. No, that's correct, through the chair. To Member Scout, the court just— alleyway paving is included in the broad pitch we'd be speaking about next week, I think. So thank you.

I'm going to go to Ms. Baldwin Day. Thank you.

I think similar, similar question. How does something arrive on the qualified list of traffic calming and safety improvements? Secondarily, How do, how do we assess, um, do we assess that list based on population density or actually living? Yeah, so that list is developed through traffic counts and other criteria. So each summer we do data collection, and based on what the traffic's being and the other different characteristics, whether it's Some of the density questions, some of the proximity to school, take all of the qualified streets and create a prioritized list.

Uh, and it's also based on projects that are going on and just our understanding of what the community's needs are. Uh, and, and so we develop kind of the next priority of projects that we do the process. Is that available? Like as a map or a GIS place that the public can go to see here's what's in design, here's what's slated for construction next summer? Is that publicly viewable in any way?

We have been working on that, and I believe there is a version that I'll have to go check to see what the status is, but that is a newer idea. It's something that we have been working to develop, and I think I'd have to double-check for sure. Every January as well, we usually send out a letter that goes to you, it's for the state legislature and others, that lists all the qualified streets and explains the program and findings. So that's something as well that you can look for that letter.

How much of that, I mean, it sounds like a lot of this is really about about data, traffic speeds, geographic proximity to schools, other projects.

What would you suggest we share with constituents, perhaps a neighborhood that doesn't have a road that meets the threshold, but they think that it should? Thoughts on what we ought to communicate in terms of prioritization? Yeah, so We do get the needs across the entire city and prioritize those of greatest need and impact. That weighs in our prioritization with the funds and the staffing and capacity for projects. So, as a specialty project that a community wants that isn't fitting— isn't within our prioritization from our pers— having Assembly members add it to the bond package as a named project so that it's specifically called out.

Having the state legislature provide a grant for a specific area, which has been done before, those are ways that it then becomes a decision as to what projects are— yeah, where funds in that case would go. Thank you, that's helpful. Yeah, I'll share that the, the committee is really concerned about what will happen on Rovena Street in terms of traffic if there's no longer actually a school zone in their neighborhood, which has served to some, especially during, you know, commute hours and such. And so I think that would be something, you know, maybe one of those areas where installation of speed bumps or something would— or a raised intersection would actually be continuing to manage traffic in a different way now that perhaps the school will no longer be the reason that traffic would slow down. Madam Chair, go ahead.

Thank you, Madam Chair. Follow on, on what Mr. Coy said, fully agree with his comments. Also, I know I would say that some of you circles for me, I think Member Brawley certainly was related to some past communication about Jewel Terrace Street where we had the— we had the difficult task of telling homeowners that we were not going to be able to do what they wanted us to do. And sometimes that's just the case, you know, as Miss Brause said, that there— the funding limitations, the staffing limitations, and the ability to do what all like to do in every neighborhood just isn't there. So we'd be— I'd be glad to— it's a difficult mess to frame a message like that.

Sometimes the answer is, you— we know that you want this, but there just isn't the ability to do that right now. And I think my last question along those same lines, the primary constraint capital funding, or is the primary constraint staffing at this point to be able to deliver on projects? What, what, what's the ceiling that we're bumping up against, or is the answer both?

Yeah, I would say it's both. Um, both of them interplay, um, being able to have the staff that can analyze, manage, and, uh, move projects along. Um, so those all play in for sure. With this $2.6 million that we're proposing in this bond package, how much more could we add without bumping into the limitation of staff capacity, or do you feel like this is at a pretty good balance point?

I think we're at staff capacity. We have been envisioning ways to bump that up, given that that number has been high for the last few years moving forward. But it is hard to fill positions, so hear that out, and hopefully we can have a different answer maybe next year.

Okay, Mr. Bowman.

Sorry, go ahead, Mr. Kais. I apologize, if I could just step back for a moment. Text from somebody who's listening in. The active traffic calming projects are also on muni.org/pmneprojects that I was referring to, but there is a way to see those. So apologize for being a little off, but I didn't want to miss providing that information to you.

Thank you. Thanks. Okay, Mr. Volland. I remembered what I was going to say earlier. So I once had the opportunity to go to a ribbon cutting for a crosswalk at the Anchorage Senior Center.

It was pretty awesome. And I, I'm just kind of thinking, um, as we go seeing which ones we're still working on, which ones have been delivered. One of the ways that we could instill more voter confidence in bonds and support for our bonds would be to celebrate those wins. District 1 reps, we love a ground ribbon cutting. We've been to several of them recently.

So yeah, I don't know, a ribbon cutting could be kind of cool. Getting—. Yeah, right, exactly. We could have a new ambient speed bump But yeah, I just think that that might be a fun opportunity to get out into the neighborhoods and really celebrate these things when they are delivered projects. Thanks.

So we have 7 minutes left, and we're going to turn now to maintenance operations. I think we're good with traffic calming. Thanks for being here. And we know there's a lot more discussion we can have at a time, so I'll turn last to maintenance operations, and then I'm going to note generally what I'm seeing on the abilities, and I'm going to again remind folks there are many different places we could go with some of these that would be a different department and a different discussion. I'm looking— if you have questions about that, please hold them for the Health Department because M&O is not going to be able to answer your questions.

And so with the last folks to give an overview, and then we'll go right up to our time. Thanks.

We have $12.7 million in bonds on the maintenance with a total $21.22 million capital budget.

The other funding is for either Denaina Center is convention center funding. General government fleet is either IGCs or levy or both. Major Municipal Facility Infrastructure Repairs Annual Program. Everybody look at that one. Major Municipal Facility Infrastructure Repairs Annual Program.

That is the amount of money we spend on maintenance in the municipality on a guaranteed basis. It's in the other column because it's a part of our operating total. But that's not enough. And it used to be more. We used to have more maintenance money in our operating budget.

But as it gets cut and shifted out to a different fund source, whatever is possible in the 1, 2, 3, 4 years when people are making cut decisions, think about necessarily what that means to the building in year 5, through 40. So that's a real challenge.

All of these are deeply needed, and if we have questions on index, I believe Director Troop or Mr. Colhays or Mr. Falsey can answer them. Thanks. Yeah, I imagine there's questions. I think if just at a high level, if you can, because I know some of these are not building specific, and we know, for example, Denina Center has its own funding, but most of these would be bonds. Generally, kind of how you're looking at priorities.

We know there's a big maintenance backlog at our facilities, but what are some of the things that these are addressing? I see roofs are up there, but beyond that, kind of if you can just characterize some of the main themes.

Yes, to the Chair.

Probably our main area of focus right now is in updating control systems and fixing control systems and bringing a level of operability to them. The problem's going on with the loose angle.

All of that infrastructure and all of our kind of keystone buildings is original to the building, so we're talking about stuff that's 40-some years old, and all of it needs request even. So the control systems are woefully inadequate for the modern world.

Thank you. Other questions for members?

So I have a question about the Major Municipal Facility Infrastructure Repairs Annual Program. It looks like we have $100,000 earmarked for energy conservation upgrades. How are those the same or different than the Facility Energy Efficiency Program? That's the $4 million bond.

I'm on MO page 15. which is the Facility Energy Efficiency Program, MO-19, which is the Major Municipal Facility Infrastructure Repairs Annual Program. Facilities, paragraph 1, 2, 3, 4, 5, it has $100,000 conservation upgrades. I'm just wondering, how are those similar or different than the energy efficiency program that we're bonding for? Through the chair, the energy efficiency program that we are offering on the This list is new this year. The annual, just the summary total of what would be put into.

So Director Troop can answer this question, but I think $175,000 a year and that gives them 2, 3 fixes on emergency repairs. And they believe they will be of that category of spend. Gotcha. So if we were to do program, and I mean, this— it sounds like this is coming from operating funds. That, that, like, $100,000 little drop could maybe go somewhere else and do different maintenance work.

Through the chair to Member Baldwin Day, the reason the facility energy efficiency program was created for this year is because exactly what you are saying. We—. Those are deeply needed improvements that are not only really municipality, but related to the energy consumption and the challenges we are currently under. So we are trying to identify, label, make it transparent that these kinds are not just deferred maintenance. They are going to save us money and opportunity, like cost that we are leaving on the table because level of deferred maintenance that we have.

I think most of us understand that the Health Department building is, a huge challenge. And we are department building status with lots of things, if not already at that status. And that means it is so much more expensive to make your basis. We need to ask the question, do we invest in ourselves up front to make these costs lower over time and also have good infrastructure? Yeah, absolutely.

Um, isn't that— we are not adding more bond funding to the facility repairs program.

Through the chair, no.

Yeah, I've been elevated to a judge, I guess. So any other further questions from members? I don't see any. I'll just say one word, and that is pools.

Enough said there. Okay, so we're at 4:15, or, well, we're at 4:16, so we do need to end the meeting. This work session. So again, thank you so much for everybody, uh, for being here. The parade of directors, uh, for operating budget next week.

So that is Friday, October 23rd. Uh, just a couple things I want to put on the record before we officially— that'll be our second work session overview on the budget. Please come prepared if you, uh, have an opportunity with your questions. Uh, we'll dive deeper into the opera. Also, for members' awareness, it will be during AFN, um, and so the parking lot outside— and for directors as well— parking lot will be closed, and so folks will have to make alternative accommodations.

Look for an email from Legislative Services to how we've handled that in the past and how we plan to handle it. And that work session will be 11:00 AM to 4:00 PM, and we will definitely use those 5 hours. So with that, I think, I think there's not any other business today. This is our last meeting of the day, so we are adjourned. Thank you.