Many borough property owners are about to get a tax break.
The Kenai Peninsula Borough Assembly on Tuesday approved a reduction in the general fund property tax mill rate for fiscal year 2003, shaving the current 7-mill levy to 6.5 mills, a savings of $50 a year on a $100,000 home.
That won't translate to smaller tax bills for everyone, however. Residents of rural areas will start paying that half mill to the Kenai Peninsula Road Service Area instead. The assembly voted to boost the tax levy for roads to 1.5 mills from the current 1 mill to pay for increased maintenance on borough roads and to help match state funds for road projects. The half-mill increase was the second such increase in three years.
The new mill rates coincided with passage Tuesday of the fiscal year 2003 borough budget, which appropriated $52.6 million in general fund money to operate the borough, pay for schools, cover school debt and other government functions. That figure included roughly $12.1 million to handle general day-to-day government duties and $30.7 million representing the local share of funding for Kenai Peninsula schools.
The overall budget for the Kenai Peninsula Borough School District, including state funding, was set at just over $92 million.
The $52.6 million general fund budget is lower than the current 2002 budget, which now stands at $53.7 million. That figure is as of the end of March, according to Jeff Sinz, director of finance, and likely will change slightly by the close of the fiscal year on June 30. The new budget is significantly lower than budgets of the late 1990s, 2000 and 2001, primarily because of a recent reduction in school debt.
Sinz said he was pleased with how the budget went together this year and with the response of the assembly.
"The decisions by the assembly were good ones by and large," he said.
Mayor Dale Bagley also expressed satisfaction with the budget process and the increase in the road service area mill rate.
"Roads have always been an issue near and dear to me, so I have no problem with that mill rate decrease (in the general fund mill rate) going to the road department," he said. "Despite what we did two years ago (referring to the earlier road service area tax increase), the road service department has still been the worst-funded department here at the borough. So this certainly brings it on par with the rest of the borough departments."
It also provides a little tax relief to city dwellers and should bring better roads to those outside the cities in the future, he said.
The Kenai Peninsula Road Service Area's budget jumped from $2.95 million in the proposed budget ordinance to $4.15 million in the final version, reflecting the additional revenues expected from the property tax increase.
About $950,000 of that will go to road capital projects, $200,000 to bring the fund balance up to the minimum recommended for the road fund by borough policy and another $250,000 to general maintenance.
Included in the $30.7 million local-share appropriation to the school district budget were $24.6 million in direct payments, $5.1 million in maintenance, $45,500 for district utility costs, nearly $880,000 for insurance, $26,000 for district audit fees and $71,401 for custodial services.
The borough also will spend almost $1.7 million on insurance and litigation, and another $545,590 for equipment replacement.
The enterprise fund of Central Peninsula General Hospital gets $4.46 million, while South Peninsula Hospital's enterprise fund will receive $2.65 million.
The assembly also appropriated $2.88 million to the School Debt Service Fund, and just over $377,000 to the North Peninsula Recreation Debt Service Fund, as well as assorted appropriations to various capital projects funds for the borough, school district and service areas.
Here is a breakdown of appropriations to special revenue funds for fiscal 2003:
Nikiski Fire Service Area -- $2,787,872;
Bear Creek Fire Service Area -- $201,401;
Anchor Point Fire and Emergency Service Area -- $242,550;
Central Emergency Service Area -- $3,989,049;
Kachemak Emergency Service Area -- $303,794;
Central Peninsula Emergency Medical Service Area -- $143,035;
North Peninsula Recreation Service Area -- $1,408,119;
KPB Road Service Area -- $4,154,028;
KPB Engineer's Estimate Fund -- $50,000;
Post-secondary education -- $377,347;
Land Trust -- $638,025;
Kenai River Fund -- $399,935;
Disaster relief -- $56,157;
Underground storage tank removal and upgrade -- $2,430;
Nikiski Senior Service Area -- $173,309;
Solid Waste -- $4,343,326.
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