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Borough right on track with budget

Posted: Wednesday, February 13, 2008

December 31, 2007 marked the halfway point for the borough's fiscal year 2008 budget, and according to finance department figures, revenues are outstripping expenses.

Craig Chapman, Director of Finance for the borough, told the Kenai Peninsula Borough Assembly on Feb. 5 that with 50 percent of the year gone, some 49.77 percent of budgeted expenditures had been made, and 73.96 percent of budgeted revenues collected.

The first and second quarters of any calendar year are the weakest (meaning January through June). But the first two quarters of the fiscal year cover July through December and are the strongest for sales tax revenues.

Rising prices, especially for fuel, have had an impact, he said.

"Last year when we prepared the budget for sales tax we were looking at gas prices of approximately $2.50 (a gallon). We're now at $3.30, so you figure that sales taxes associated with that is probably up about $300,000 to $400,000," he said. "I would expect that to continue to the end of the (fiscal) year."

According to borough data, real estate tax revenues for the budget are estimated at more than $25 million, of which more than $23.8 million already has been collected. Personal property taxes have actually resulted in slightly more than was budgeted, bringing in almost $1.5 million, all of which has been collected.

Oil taxes have netted $3.34 million, while some $12.5 million out of an estimated $21.9 million in sales taxes have been collected so far. Payments in lieu of taxes (federal money paid on real property) and other federal revenue produced another $1.92 million.

The borough's investment portfolio showed a healthy return over the past calendar year, a lot of it occurring in the last six months, Chapman said. Interest on the investment portfolio has so far garnered about $1.18 million, while the portfolio's fair market value climbed $1.48 million.

Also helping the current budget picture was $1.75 million in energy assistance from the state.

When the finance department brings forward the fiscal year 2009 budget, it will include numbers for fiscal year 2008 that will be higher than originally budgeted, Chapman said.

On the expenditure side, the revised fiscal year 2008 budget calls for expenditures of $63.4 million. Of that, just over $31.5 million has been spent.

Hal Spence can be reached at hspence@ptialaska.net



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