Anchorage Mayor LaFrance lays out $637M city spending plan for 2025

Oct. 3—Anchorage Mayor Suzanne LaFrance on Thursday introduced her administration's draft 2025 city budget, which totals about $636.5 million in proposed general government spending.

Each fall, Anchorage's mayor proposes a spending plan for the upcoming year. The proposal is then reviewed and often revised by the Anchorage Assembly. A budget vote by the 12 Assembly members is anticipated in late November.

LaFrance's proposal is about $25.6 million more than this year's about $610.9 million revised budget, which was developed and revised by former Mayor Dave Bronson and the Assembly.

According to the mayor's office, LaFrance's proposal sits about $173,250 below the city's tax cap — or how much revenue the city can collect in property taxes. The estimated tax cap for next year is $373.9 million, which includes taxes collected from the Anchorage Bowl and limited and rural road service areas, according to Ona Brause, director of the Office of Management and Budget. Property taxes account for around 60% of the city budget.

Property taxes are expected to increase next year under the proposal, Brause said, adding that tax increases are part of the annual tax cap calculation.

LaFrance told reporters Thursday that her proposed budget prioritizes fundamental city services and is "tackling the big challenges," including homelessness and crisis response, snow removal, staff recruitment and retention, and safe trails, parks and streets.

One major proposed change includes funding more homelessness response, she said.

"This is the first mayor's budget I'm aware of that builds in this level of funded response to homelessness," LaFrance said.

Most of the $25 million increase in next year's proposed budget is due to the rising cost of labor and contractual increases for labor unions, Brause said. The jump in the budget also accounts for about $7 million more in debt payments that the city must make next year. The cost of maintenance and operations, facilities, equipment and, in particular, utilities, is increasing by about $2.8 million, she said.

Some longstanding expenses have been moved from the alcohol tax budget into general government spending, Brause said. Keeping the 56th Avenue homeless shelter open for the entire year adds a cost of about $3.5 million, she said.

Here are some of the major changes and highlights included in the proposed budget, according to the mayor's office:

—Funding the city's 200-bed homeless shelter on 56th Avenue for a full year.

—A 10% increase to the Parks and Recreation Healthy Spaces team, in order to bolster homeless camp cleanup.

—Directing $2 million to fund rapid rehousing of people experiencing homelessness, plus fully funding the city's winter shelter plan.

—A $1.36 million increase in funding for 24-hour service of the fire department's Mobile Crisis Team.

—Moving the Anchorage Safety Patrol from the Anchorage Health Department to the fire department, with $4.1 million to fully fund ASP operations.

—Increasing pay for snow removal staff by 5.7%.

—To improve recruitment and retention of staff, the mayor's office is proposing to carry over executive pay increases made in 2024, adding a 1.5% wage increase for city staff not represented by unions and increasing pay for city prosecutors.

—A proposed tax levy of $3.5 million to replace broken and outdated heavy fleet vehicles and large equipment, including dump trucks and equipment used for snow removal, such as graders. It would allow the city to buy six to seven a year.

—A proposed $3 million public safety levy to replace aging vehicles in the police department's fleet. This would allow the city to purchase about 40 police vehicles a year.

Tax levies are similar to bonds, requiring voter approval, but rather than resulting in a temporary tax increase, levies are paid in perpetuity, Brause said. Anchorage voters would see the proposed levies on their ballots during the April city election.

"We have police vehicles with over 200,000 miles on them. We have snow equipment that's over 30 years old, and it's time to do something," Municipal Manager Becky Windt Pearson said. "The result of not keeping up with replacement of these aging vehicles and equipment means we're spending more and more on maintenance."

The LaFrance administration's proposed spending plan for capital improvements — which is separate from the operating budget — focuses on "critical investment to improve safety and usability" of streets, trails, public buildings and spaces, Windt Pearson said.

It includes $4.5 million in projects for traffic calming and safety and $7.3 million in trail and park improvements, including $2.9 million in renovations to Town Square Park in downtown Anchorage and $450,000 for design and permitting of a project to improve access to Chugach State Park at the Basher Drive trailhead.

Next year, Anchorage will also begin spending from its new Anchorage Child Care and Early Education Fund. LaFrance has proposed $2 million in stimulus payments, aiming to help stabilize the child care sector, and $2 million to fund pilot projects that could increase access to child care and early education, according to the mayor's office.

Another major change is the proposed allocation of $2 million for housing homeless residents — money that LaFrance had initially earmarked for funding emergency winter shelter beds. The administration is reducing the number of beds from 500 to 400 that it plans to open for homeless residents in local hotels at the end of the month.

Farina Brown, special assistant to the mayor in homelessness and health, said the reduction was specifically in response to community feedback on the sheltering plan, concerned about where people in shelter would go next. It will help create "movement in the system" and "choice and support" for residents who need housing, Brown said.

Assembly member Anna Brawley, who co-chairs the Assembly's Budget and Finance Committee, said that the public will have the opportunity to give input during two public hearings at the Oct. 22 and Nov. 6 meetings, before the Assembly's vote on Nov. 19. The Assembly will also hold three public work sessions in the coming weeks, she said.

Brawley, who generally votes with the Assembly's majority, was largely positive about the LaFrance administration's budget proposal.

"This feels like the right list of priorities," she said of LaFrance's budget. "It feels consistent with what we've been doing and have said need to be budget priorities. And, of course, where all this shakes out is the discussion for the next six weeks or so."