A novice at the controls

A NOVICE AT THE CONTROLS: BILL STARR'S FIRST BUDGET: Assembly conservatives handed over the Assembly's most powerful committee to Bill Starr after only three months he was appointed to fill a vacant seat on the Assembly. The Eagle River freshman’s shaky tenure as Chair of the Assembly’s Budget and Finance Committee proves once again that experience counts, even on the Anchorage Assembly.

On September 11, 2007, Starr convinced the Assembly to pass AR 2007-125 and find that the "ability of this municipality’s residents to financially support government services is or at near its maximum capacity". His resolution asked the mayor to submit an operating budget for 2008-9 "reflecting no increase from the revised operating budget for 2007." (emphasis added) The impact of the Starr Resolution was not fully understood until October 9, 2007 when Mayor Begich released his proposed operating budget for 2008. The mayor’s budget called for spending of $429M, an increase of $29.8M, or 6.95% over the $399M spent in 2007. Although the mayor justified more than half of that increase as beyond his (and the Assembly’s) control by pointing to rising costs for fuel, employee health care, retirement contributions, and union contracts, that increase was targeted immediately by Starr and other Assembly conservatives as excessive and wasteful. When compared the 2008 budget to those of prior ears, the 2008 plan was decried as yet another example of runaway government spending. Bill Starr had drawn a line in the sand and dared the mayor to cross.

Because his "conservative" friends had fired the Assembly’s budget expert two years ago in order to buy a new stereo system for the Assembly, Starr turned to the private sector for help in cutting the mayor’s budget. There he found Cheryl Frasca, a former budget chief for ex-Gov. Frank Murkowski willing to help. Dan Coffey obliged and approved a sole source contract for $18,000 with Frasca without a formal vote of the Assembly. Frasca went to work and helped draft a resolution Coffey released "for discussion purposes" on November 9, 2007. The resolution called for reductions of $25M in the mayor’s budget. After reading the resolution, the town went bananas. Public safety groups protested cuts of $2.2M in the police and fire departments and the mayor took aim at $1.M in FY 2008 funding the resolution would strip from his departments for executive salary increases lawfully granted in 2007. The Resolution also proposed cuts of $3.21M set aside for 72 new positions, including Fire, Development Services, Employee Relations, and Project Management and Engineering. The resolution also targeted $13.5M the city expects to receive from the Alaska legislature in "general assistance" revenues that will be used for property tax relief. Elimination of that amount from the City’s budget many protested, would have sent the wrong signal state legislators eager to spend the money elsewhere.

A week later, the Starr budget committee released its "Final Report" and last recommendations to the Assembly. Starr admitted he had overlooked $7M in salary savings (vacancy factor) already applied by the Mayor in his original budget. But Starr’s Final Report nevertheless recommended cutting an additional $ .71M from the budget based on an alternate method of calculating vacancy factor cooked up by Ms. Frasca. In response to howls of protest coming from law enforcement, Starr abandoned his plan to cut police and fire budgets by $2.2M for funded, but vacant positions. Nevertheless, the November 16th report recommended elimination of some 74 funded but vacant municipal positions in 12 departments in order to reduce the city budget by $3.8M, regardless of program impacts. Again, without providing an explanation, the committee recommended elimination of new positions costing $976,000. Finally, Starr targeted reductions of $563,000 in 2008 to penalize departments who had raised executive salaries during 2007. In the words of one member of the city’s Budget Advisory Commission, the "entire budget [proposed by the Starr committee] is an assault on the level of service and the well being of this community."

After the Assembly closed public hearings and started deliberations on the budget, however, the grandiose cuts proposed by Bill Starr and his budget committee fared poorly when carefully examined. Some reductions in spending, for example, would not save taxpayer’s money because they would bring about less collected in user fees. The assembly learned that other reductions, including those originally proposed by Starr for vacancy factor, had already ben considered by the mayor's budget writers. Unable to complete its work on the budget by November 27th, the Assembly continued that meeting on November 29th and approved what the Mayor and Assembly leaders called a "compromise" budget for 2008-9. Peace in the valley broke out once again.

The 2008 budget actually approved by the Assembly on November 29th, however, has a clear winner: Mayor Mark Begich. In the end, the Assembly gave him virtually everything he asked for two months ago. As approved, FY 2008 spending will be $427.8M, or $28.49M more than last year, representing an increase of 6.64% The 2008 budget gives Mayor Begich the 20 additional police officers he requested and keeps legislators’ feet in the fire by referring to the $13.5M the city expects to receive in municipal assistance to reduce property taxes. The budget approved by the Assembly cut only $2M from the mayor’s budget, a far cry from the $30M in cuts Star first demanded. Assembly conservatives did, however, manage a few whacks at the mayor’s budget before hoisting up the white flag: They cut $75,000 from a much needed East Anchorage district plan. In a particularly mean spirited move, they de-funded Project Access which links the uninsured poor with doctors and other heath care professionals willing to volunteer their services for needed medical care. Led by Debbie Ossiander, these same conservatives also managed to delete about a half a dozen new positions in the Parks Department required to maintain new parks and recreation facilities approved last spring by voters.

The final result obtained by this novice Assemblyman in his first term as Assembly Budget Chair is modest indeed: Of the $30M he originally wanted to cut from the Mayor’s 2008 budget, only .31% or $2M was actually reduced. The $2M cut will save Anchorage property taxpayers only $1M, however, because about half of the city's budget come from sources other than property taxes. On a downtown home assessed for $250,000, for example, Starr will save its owner about $12.00 in property taxes next year, or just about the cost of a single 6 pack of beer.

One final note: Among assembly conservatives who will face the voters in coming months, Bill Starr is seeking his first full term on the Assembly in April, 2008; Chris Birch and Paul Bauer are up for re election at the same time. Dan Coffey and Dan Sullivan are both rumored to be candidates for mayor in 2009.