The Homer City Council unanimously approved a roughly $22 million dollar budget Monday.
The spending plan is relatively flat compared to 2017. City Manager Katie Koester called it a conservative and cautious approach.
Like other municipalities across the state, Homer’s budget outlook is looking grim. State revenue sharing has declined significantly over the past few years. Sales tax, which accounts for half of the city’s revenue, is also expected to stay flat and 2018’s healthcare premiums spiked about 8 percent.
On Monday night, council members discussed final amendments to the budget including police drones and a new roof for city hall. The council decided to maintain funding for the roof project, but it did axe the $34,000 drone purchase. Council member Heath Smith said it’s too expensive.
“I can't see it justifying the cost involved at this point,” he said. “I mean that's basically the cost almost of a new police vehicle that I think we would get far more use and utility out of.”
This comes after the council made a series of amendments last month, including a cost-of-living adjustment for city employees. City workers say they are grateful for the .5-percent pay increase, but noted they are disappointed the council didn’t approve the 1-percent pay bump they had requested. City employee David Bernard said it’s important the payment keep up with what other municipalities are providing.
"We looked over the past half-dozen years or so. We still appear to be behind both the Anchorage CPI and what the average of the other Alaskan municipalities had given to their employees over the same time period," Bernard explained.
The council also restored $10,000 in library funding among other changes.
This year’s budget is balanced, but the council still has a looming $1.2 million budget gap to contend with in 2019. Some council members have expressed concern over increasing those budget items, saying that it will only dig a deeper hole next year.
Homer voters approved diverting a road and trail construction fund three years ago to fill the budget hole. That move is set to expire next year. Voters did approve using some of the sales tax supplying the fund to pay for road maintenance this fall, which is expected to fill about half of the budget shortfall.