Borough Mayor passes 1-year hurdle
• Carey warns of lopsided funding picture
By Naomi Klouda
Homer Tribune
On Kenai Peninsula Borough Mayor Dave Carey’s 368th day in office, he provided an update to borough officials on the state of the economy as “a tipped portrait” – up in a flood of government spending and down in gross sales revenue.
Carey was in Homer on Thursday to make his presentation, following updates in Soldotna and Kenai earlier in the week. He is one-third of the way through his first term of office, with two years remaining.
Carey said the borough saw a 17.6-percent reduction in gross sales, measured in the second quarter of 2009. A comparison to second quarter 2008 shows a troubling shift down from $734.7 million to $605 million.
Construction slowed the most at a change of 48.1 percent between the two years as measured in the second quarter. However, in 2008, a sharp spike in construction ($42.6 million) made for one of the best years ever.
“We were down significantly in construction,” Carey said in an interview Thursday. “But, taking in context the preceding year being so high, it wasn’t as bad.”
Tourism was also down 27 percent, as measured by the borough’s Office of Economic Analysis.
“The borough has done very well in terms of oil and gas, but that is changing,” Carey said. “The lower price of fuel, coupled with a declining reserve, means we will continue to see less income.”
Naomi Klouda - Kenai Peninsula Borough Mayor Dave Carey just passed his one-year in office mark. He gave an economic status report to communities around the Peninsula showing how federal and state spending is up while other borough revenue is way down.
At the last Kenai Peninsula Borough Assembly meeting, $11 million was accepted, $8 million of which is in road bonds.
This influx of government money at a time when three of the Peninsula’s main economic areas – tourism, construction and sales – are flailing, means next year will be a crucial budget year, Carey said. He added that stimulus funding is one-time money, so there would be need to be discussion on how to react to the economic downturn.
The occasion of noting his first year in office offers a chance to take stock and foresee new directions in order to be proactive, Carey said. The borough assembly is in transition with two new members – Mako Haggerty from Homer’s District 9, and Sue McClure from Seward’s District 6. He is hoping fiscal plans in the conception stage now will be more readily accepted than his proposals before the prior assembly.
In budget talks this year, Carey had proposed cutting the mill rate on property taxes to help peninsula residents during this time of economic turmoil.
“The more money residents can keep in their pockets, the better off they will be,” he reasoned. “The stimulus spending was supposed to be about helping the economy, not about building government. I believe in private enterprise.”
The borough’s fund-balance policy recommends the borough has $12 million to $23 million on-hand, to assure the general fund reserve doesn’t dwindle to uncomfortably low balances. Government accountants recommend the borough tuck away that amount for a rainy day to ensure the borough’s ability to be reimbursed for grant money it must pay out upfront. Now that the reserve has grown to $25 million, Carey said he feels that bloating could leave room for giving property tax relief down the road and still leave enough for savings.
“There is still room for tightening spending,” he added.
Some $1.7 million was left over from department budgets the last fiscal year after Carey encouraged his managers to find places for savings. That money can then be rolled back into the general government fund. “That included all areas of their budget – personnel, supplies, contracted services, communications, training – everything,” he said. “This demonstrates proper oversight of budgets during the end of the fiscal year, which sometimes includes spending for the purpose of using up a budget.”
Carey said he also hopes to reduce training/travel expenses by $250,000 in the 2010 Fiscal Year budget by placing a moratorium on all travel for training after Jan. 1, 2010, unless it relates to certification. He recommended looking at technology such as video-streaming, rather than traveling to the Lower 48.
This first year of office has been a busy one, Carey contended. He works seven days a week, even if it’s just a few hours a day on Sunday.
“I really try to answer e-mails on the same day I receive them,” he explained. “I don’t always get them all, but I try.”
In March, Carey will unveil his budget ideas for the coming fiscal year.
Posted by Newsroom on Oct 28th, 2009 and filed under Headline News. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.
4 Responses for “Borough Mayor passes 1-year hurdle”
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If only our federal government could live by the policies of Mayor Carey. The Mayor understands the need for true fiscal discipline, even (or should I say especially) during a downturn. Contrast that with the feds, who have told us that the way to get out of the hole is to spend trillions in every direction imaginable, spend it quick, and save nothing. What a joke. If only it were funny. I can’t laugh when the children of today will someday be paying for the fiscal crimes of our federal leaders. Mayor Carey has the courage to stand up and make controversial decisions and cuts in the budget. The Borough will benefit from his leadership. Mayor Carey also seems to comprehend the idea of putting money into savings, instead of blowing it all plus some. I hope his policies and budget plans continue to be consistent with his rhetoric. I think a mark of a true public servant is when he can propose cutting taxes across the board instead of raising them on anyone (even the despised “rich”) when the coffers get low.
“I can’t laugh when the children of today will someday be paying for the fiscal crimes of our federal leaders.”
It is far past time for us to recognize that our entire US government is corrupt, both Democrats and Republicans. Over 50% of tax dollars go to the military whom both Republican and Democratic presidents have now misused in a war of aggression on two nations that had little to nothing to do with 9/11. When a nation goes to war to support the Military Industrial Complex, war profiteering and the far reaching interests of multinational corporations…there is no way to fix the budget crisis without looking at the whole picture. The money wasted and outright stolen by war profiteering companies like Halliburton has never been examined much less anyone held accountable. This theft unexamined continues today. We cannot talk about government spending without discussing this huge waste.
The recent looting of the nation for the benefit of bankers was brought about with the support of both Bush and Obama. Obama has hired more Goldman Sachs employees than they have left at the company. They just robbed the US treasury with everyone watching, leaving our children to pay the price, and yet US citizens have still done nothing.
Mayor Carey seems like one of the good ones, and as we see these changes locally, we must begin to demand action nationally. And I don’t mean shutting down any spending on universal health care(not that I agree with with current legislation considering the inclusion of mandatory insurance) but rather talking a hard look at the real $$ being wasted handing out trillions to bankers and war profiteers.
The “war on terror” is no longer a war, but rather a mission of service to a country that needs help. Also if there were wasn’t any terrorists or other enemies of the country in these countries soldiers and civilians wouldn’t be being murdered by car bombs.
The war in Afghanistan might be about more than the ‘war of terror’…”“There’s no significant drug trafficking anywhere in the world in which the CIA isn’t involved.” This truism has again been confirmed by a report in the New York Times. While in the past it was limited to hanky-panky with drug lords in Latin America or Southeast Asia, this time the agency, according to the New York Times article, is actually part of an organized crime operation in the Hindu Kush war zone. Active and former U.S. intelligence personnel claim that Ahmed Wali Karzai, brother of Afghan President Hamid Karzai, is a known key player in the Afghan drug world but has nonetheless been on the CIA payroll for the past eight years.”