3.0 Affected Environment - Knik Arm Bridge and Toll Authority

Knik Arm Crossing DraftFinal EIS
Affected Environment
The Mat-Su’s average property tax rate, based on 27 service areas, is 11.483 mills. The
Borough does not have a sales tax, but it collects a 5 percent tax on accommodations. The
Mat-Su collected $55.5 million in local property taxes in 2004. Additional revenues were
collected from oil and gas properties, which make up a small portion of the Borough’s
property base.
Land values in the Mat-Su have steadily increased over the last decade, causing property tax
payments to increase. The mill rate has been decreasing, but not enough to offset increasing
real estate values. To provide property owners in the Mat-Su some tax relief, the Mat-Su
Borough Assembly approved a tax cap ordinance in August 2005 that mirrors the Anchorage
tax cap described below. The tax cap does not apply to taxes on new construction or property
improvements made during the current fiscal year; taxes required to fund additional services
mandated by voter-approved ballot issues; special taxes authorized by voter-approved ballot
issues; taxes required to fund the costs of judgments entered against the Borough or to pay
principal or interest on bonds, including revenue bonds; and additional taxes collected in
service areas under mill rates specifically approved by service-area residents.
The Borough’s tax cap will go into effect with the 2007 Borough budget, which will be
adopted in May 2006. After a 2-year period, the tax cap can be revoked by the Assembly or
repealed by voter initiative.
Fiscal year 2005 operating expenditures for the Borough are allocated to Borough operations
($45.4 million), enterprise funds ($4.5 million), education operations ($148.9 million), and
general operations ($7.4 million).
The Borough’s capital improvement budget in FY 2005 consists of about $6.98 million.
Selected budget items include: area-wide road program ($1.2 million), fire service areas
capital projects ($1.1 million), road service area capital projects ($1.8 million), and solid
waste capital projects ($450,000).
Port MacKenzie’s FY 2006 budget includes projected revenues of $2.494 million and
expenditures of $2.493 million (MSB 2005e). As of this writing, the budget for the port is
break-even, but it is anticipated that with port growth, funding will become available for
further port development.
3.2.3.2.2 Palmer revenue sources and major expenditure categories
The City of Palmer’s FY 2005 budget is based on total revenues of about $6.4 million. Sales
taxes are responsible for a little more than half ($3.8 million) of the budgeted revenues.
Palmer levies a 2.557 mill tax on properties located inside its boundary. It also charges a
3 percent sales tax. Total property tax revenues for Palmer were $622,879 in 2004. During
the 1998–2004 period, collections grew from $378,000 to nearly $623,000.
Palmer’s expenditures for FY 2005 are $6 million. The Police ($2.5 million) and Public
Works Departments ($1.3 million) are the two largest expenditure items, accounting for a
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