Road board approves mill rate hike

Friday, April 7, 2017 - 10:34
  • Homestead Road in Chugiak, March 2017. Road maintenance within the Chugiak Birchwood Eagle River Rural Road Service Area is funded through local property taxes, overseen by the CBERRRSA Board of Supervisors. (Star photo by Kirsten Swann)

A new mill levy rate recently approved by local road supervisors means Chugiak-Eagle River homeowners will see a slight change to their next property tax bill – a bump of approximately $21 for a $300,000 home, according to municipal officials.

The increased rate of 1.9 mills comes in response to vanishing state maintenance funds and a 2016 administrative error that set an artificially low mill levy rate last year, prompting the Municipality of Anchorage to dip into a reserve account to pay for road services.

“There was a foul-up in the paperwork,” said Mark Littlefield, Eagle River Street Maintenance general foreman. “I can’t put any blame on anyone because we don’t know what happened.”

Within the Chugiak Birchwood Eagle River Rural Road Service Area, road maintenance funds are collected through property tax levies and managed by the CBERRRSA Board of Supervisors. Though board members last year approved a mill rate of 2.1, the final paperwork submitted to the Anchorage Assembly set the rate at 1.83, Littlefield said. Because the areawide street maintenance budget was based on the original 2.1 rate, actual revenues fell short of what was budgeted.

An increase of .07 mills works out to $7 more per $100,000 of property value.

To pay for snow removal in October, November and December, Littlefield said, the road board withdrew $500,000 from the CBERRRSA reserve account, spending approximately $381,000. Some board members expressed alarm at the amount of withdrawls.

“We’re going through reserves like crazy,” road board member Anthony Vita said during a March 8 Birchwood Community Council meeting. “It’s more than the handwriting on the wall, it’s the handwriting right in our face: The money’s drying up.”

As of December 12, the reserve account held an unaudited fund balance of slightly more than $1.6 million, Littlefield said.

The statewide budget deficit means the local road service area must shoulder a growing cost burden. While the State of Alaska has pitched in to pay for various overlay programs in years past, these days, those overlay programs are covered by CBERRRSA funds. According to the local maintenance foreman, the newly increased mill levy rate would help pay for that.

Another big cost? Unanticipated recent snowfall.

“We’ve had a horrendous spring – normally we don’t get this much snow,” Littlefield said.

Contact Star reporter Kirsten Swann at kirsten.swann@alaskastar.com

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