Property taxes stay flat, raises nixed in final borough budget

Non-union borough employees won’t get a 3% raise this summer. That’s following passage of the Ketchikan Gateway Borough Assembly’s revised budget that removes the wage hikes for managers and other employees not covered by a collective bargaining agreement.

Assembly members say they made the change in response to the area’s uncertain financial future. A 20% decline in sales tax revenue in the next fiscal year is projected largely due to the COVID-19 pandemic which disrupts the summer travel season.

The decision was made at the May 1 assembly meeting. Assembly Member Sven Westergard was the lone dissenting vote in canceling the 3% cost-of-living adjustment for non-union borough employees. He tried to bring the matter back for consideration on Monday but none of the other assembly members present supported the motion.

Borough employees represented by a union, on the other hand — including airport ferry workers, electricians, bus drivers and others — will receive a 3% pay increase as per their contracts.

In other business, the assembly held property tax rates flat for the next fiscal year, which runs from July through next June. The areawide tax, which funds Ketchikan schools, will stay steady at 5 mills. That means the owner of a property assessed at $250,000 will be liable for $1,250 in taxes.

Rates for three of the borough’s four service areas will also stay flat. Service areas pay for services like fire protection and road maintenance in areas outside of city limits.

The only tax hike affects the Old Dairy Road Service Area south of Saxman. That’s a new entity authorized during the borough’s municipal elections last year. The assembly unanimously set its inaugural property tax rate at 5.8 mills. For example, a quarter million dollar property could e liable for $1,450 in taxes.

Finally, the assembly approved the Ketchikan School District’s roughly $46 million budget. Of that $11 million is local funding.

The assembly also gave preliminary approval to a measure that would allow the district to roll any budget surplus into next year. Ketchikan school leaders had asked for the change, citing the state’s decision to grant the district $588,000 in CARES Act funding during the current fiscal year.