Next year’s city budget now has a seal of approval from the Sitka Assembly, with a $17,000 surplus.
When the assembly met on Tuesday (5-23-23), it unanimously approved a $42 million dollar general fund budget for FY’24. The budget process is months long, so by the time it came to a final vote, there was little discussion, and only one comment from the public.
City Administrator John Leach said he did take public feedback into account throughout the budgeting process, and thanked Sitkans for using the open finance tool on the city’s website to make recommendations. Leach said the process was different for staff this year too.
“We did do a true zero-based budget, and we started from there and all the department heads were required to submit what’s called a ‘resource proposal form'” Leach said. “So they had to basically explain to me why that resource was necessary, how it aligned with our guiding documents, our code, our charter, our strategic plan.”
General fund expenditures will be about 14% higher next fiscal year. City staff say some of that increase in spending can be attributed to inflation. The same is true for the city’s enterprise funds. The electric, water, wastewater, solid waste and harbor budgets will each include rate increases next year.
That didn’t sit well with some assembly members, including Chris Ystad, but he thought it was unavoidable. He said he’d worked on other budgets this year, including a couple of local nonprofits and his own business, that were facing similar challenges with inflation.
“These rate increases are right in line with what all these other organizations are incurring, especially with what these enterprise funds deal with, and that’s raw material for the most part, copper, steel and just other raw goods,” Ystad said. “And then the wastewater [fund] getting this new treatment plant thrown on top of it that, it’s just really put us in a bind. So as much as I don’t want to see the rates increase, I think, in order to stay on top of these enterprise funds, it’s something that we’re having to do.”
While the general fund budget ended up with a surplus, some of the enterprise funds are taking on some additional debt this year, including a $7 million dollar loan for the wastewater plant to install a disinfection system that meets new requirements from the EPA.
Ultimately, the assembly approved the enterprise fund budgets on a 6-0 vote. The new fiscal year begins on July 1, and budgets will likely be amended throughout the year.