City and Borough of Juneau
Assembly Finance Committee Meeting
Wednesday, August 4, 2010 - 5:30 p.m.
Assembly Chambers

I. Call to Order

II. Roll Call

III. Approval of Minutes
May 12, 2010

IV. Utility Rate Increase Recommendation
The Utility Advisory Board (UAB) is recommending a 14% across the board rate increase for all CBJ utility customer service classes for water and sewer for the fiscal year beginning July 1, 2011. An alternative would be a 7% increase in FY11 and another 7% increase in FY12.

At a joint meeting of the Public Works and Facility Committee and the UAB held on June 17, 2010, the rate increase recommendation was moved to CBJ Assembly Finance Committee

Included in your packet is a memo from Joe Buck, Public Works Director, and supplemental information regarding the rate increase. The supplemental information provided is:
- An April 12, 2010 memo from Dick Behrends, UAB Chair.
- FY2011 Water Utility Rate Model Revenue Requirement Analysis, April 12, 2010
- FY2011 Wastewater Utility Rate Model Revenue Requirement Analysis, April 12, 2010
- A May 14, 2010 memo from Dick Behrends, UAB Chair

V. School District GO Bonding Request
The School District is requesting the Assembly place on the fall ballot the question of issuing a 10-year $18.7 million GO bond for the renovation of the Auke Bay Elementary School. These bonds would qualify for 70% reimbursement under the State’s School Bond Debt Reimbursement Program. If the State fully funds the reimbursement program, the estimated annual debt service cost after State reimbursement, assuming an interest rate of 2.8%, will be $651,000. This amount of debt service would require an annual property tax levy of approximately $16.00 (0.16 mills) per $100,000 of assessed value.

In making their recommendation the District reviewed a number of different options for the Auke Bay School. This review included both the renovation of the School and a complete replacement. When reviewing the replacement options they reviewed both the current and alternate locations.

Representatives from the School District and Engineering Department will be on hand to discuss the proposal and answer questions.

VI. Ballot Question of Extending the 1% Temporary Sales Tax Levy
On July 19, 2010, the Assembly approved a motion by Mr. Sanford to bring forward a question of extending the 1% temporary sales tax levy to fund the North Douglas Crossing to the Assembly Finance Committee. The approved motion reads as follows,

“To include a ballot proposition on the October 2010 ballot to ask the voters to extend the 1% temporary sales tax due to expire September 30, 2013, with the intent that the Assembly would appropriate the revenues for the purpose of design, permitting and constructing a North Douglas transportation crossing between the Glacier Highway interchange and Henrickson Point, the estimated cost of which is $70 million.”

Included in your packet are three letters both in support and opposition to this proposal.
- A July 23, 2010 letter from Mayor Botelho
- A July 27, 2010 letter from the S.A.F.E Committee (Safe, Affordable, Future, Efficient)
- A July 30, 2010 letter from Cathie Roemmich, JCC.

Note that to fully fund the North Douglas transportation crossing using a 1% the sales tax levy would require the levy be in place until the early 2020’s (noting that the levy would not start until October 1, 2013). To move this project forward early on during the levy period would require some form of project borrowing. A tax levy would not qualify as support for a revenue bond. Some other form of project borrowing would need to be identified. This could include voter approval of a GO bond.

Supplemental information added on 08/04/2010: Memo from Craig Duncan, Finance Director, to Mr. Doll, Assemblymember, regarding the use and impacts of using a 1% temporary sales tax levy to fund the North Douglas Crossing.

VII. Adjournment