If you’re concerned about cuts to Haines Borough facilities like the public library, museum, Chilkat Center and swimming pool, where were you last year when the assembly approved three years of raises for borough employees totaling hundreds of thousands of dollars?
Without those raises, our town could have been spared recent cuts to facilities.
Haines progressives need to get their heads out of the sand. The town’s biggest issues aren’t the Constantine mine or the firings of any number of borough managers. The biggest issue in local politics is money – where it comes from and who gets it.
It’s the Haines Borough budget.
Compared to supporting or opposing a mine project or liking or disliking a borough manager, budgets are complicated and boring. They also decide the fates of towns and nations.
King Louis XVI of France penciled into his budget 1.3 billion livres for the American colonies in their war against Britain – including for most of the rebel gunpowder. The spending destabilized France, helping precipitate a bloody revolution that toppled the French monarchy, but it did wonders across the Atlantic.
Is your favorite nonprofit struggling? Part of the reason may be that the borough has reduced funding of nonprofits by about two-thirds, down from a historic high of $120,000, which at that time was just 1 percent of the borough budget.
Governments all over the U.S. and the world fund nonprofits for the simple reason that they deliver public services and programs for less money than government can. To survive, our town will need to spend more on nonprofits and less on government workers, but who’s fighting that battle?
Think you have a handle on the borough budget? If you’re not following it closely, it can be tricky. For example, you might think the police department was cut $35,000 this year in a bold move by the assembly. It was.
But police payroll was scheduled to increase by $22,000 this year, partly due to last year’s raises including Heath Scott’s whopping $10,000 pay raise which was negotiated after last year’s borough budget was approved. So the “$35,000 cut” may actually only amount to cutting $13,000 from the amount police got last year.
Also, the assembly may elect to cover the “$35,000 cut” to police from the federal CARES Act money, meaning that in actual dollars, police department spending may not be cut at all. It will increase by $22,000.
But let’s get back to Heath Scott negotiating a pay raise with the borough manager after last year’s budget was approved. Approving raises after the budget is finalized is an old, cheap and effective political trick. In winter’s dark months, borough leaders talk a tough budget game: “Sorry. There’s no money this year. Forget about a borough contribution for your non-profit, or for facilities or for recreation. Everything must be cut.”
But in late June, after the budget is approved and when most folks are too drunk on sunshine and warm weather to pay much notice, money flows from government like rivers off a warming glacier. The Haines school board pulled this trick with teacher raises for years.
Here’s another trick: Keep fiscal conservatives off the borough bargaining committee. As chair of the assembly’s finance committee, I asked to serve on the committee bargaining with the union in 2019. Mayor Jan Hill and my fellow assembly members deemed me not diplomatic enough to negotiate.
All the assembly’s fine diplomacy cost borough taxpayers an additional $265,000 every year, likely extending to forever.
This is what I planned to say to the borough union: “How much do you want your jobs? How much do you want your co-workers to have jobs? If these salaries go up, jobs will be cut and facilities and borough services will suffer.”
In fact, that’s what we’re starting to see with the elimination this year of the director job at the Haines Sheldon Museum. Museum board members decided they might run the facility better without a highly paid director.
Last year’s liberal assembly should have said “no” to the raises and left it at that.
Continually increasing salaries cannot be sustained without cuts to positions or services, or significant tax increases. That’s the bottom line. In negotiating raises, the borough’s top earners effectively played chicken with the jobs of others, and with historic levels of service, while forcing cuts to important facilities, programs and services.
Progressives who believe we can live like we used to 20 years ago by increasing local property taxes need to come clean, as well. Many of them qualify or soon will qualify for the senior citizen property tax exemption, meaning they’ll pay taxes only on the first $150,000 of value on their homes.
It’s easier for them to support increased property taxes, as an increase won’t hurt them as deeply as it will hurt younger, working people who will be taxed on the full value of their homes.
Then there’s the matter of the tax cap, an ill-advised measure approved by voters about a decade ago that limits property taxes to 10 mills. In the 1970s, a time before oil money started flowing, City of Haines property taxes climbed as high as 17 mills. It won’t be long before the borough needs to raise taxes over 10 mills, even if it slows down spending.
Who will fight to eliminate the tax cap? Who will fight the Alaska Legislature and demand that it eliminates the senior property tax exemption, an unfunded mandate that costs the borough $360,000 in lost income each year? Who will take on the borough union when it comes back in two years for another round of raises?
The current, conservative assembly deserves praise at for least trimming the voracious police department, for reducing staff travel and for eliminating an unnecessary, $70,000 planner position sought by the administration.
But reworking the budget in a meaningful way that will retain services and facilities at levels that aren’t draconian will take more guts and creativity than we’ve seen from the assembly in decades. This year’s assembly gets points for guts. The fate of this town, as we know it today, may well rest on whether progressives on the assembly can show as much spine, plus add some creativity.
Spending down reserves and tapping the borough permanent fund might work for a year, but they’re not a long-term strategy. It’s time for progressives in Haines to get to know the town’s budget.