FAIRBANKS — Mayor Luke Hopkins said Tuesday that local government here is more stable than many believe — particularly when compared to other city and county offices around the United States.
A stable tax base and strong borrowing power help balance looming challenges facing local government — air pollution and questions over long-term military investment — Hopkins told a mid-day chamber of commerce audience.
Comments from a credit agency, Standard & Poor’s, in 2009 about Fairbanks’ “good financial position” confirm the investment climate here is solid, he said.
“That’s the message, I think, that’s important,” Hopkins said during his annual “state of the borough” address.
Local government gets much of its income from property taxes, which voters regularly cap with a constant ceiling. That revenue stream has stayed roughly the same over time after adjustments for inflation and population growth.
Hopkins’ pointed to signs of economic health, including the community’s steady tax base. Fairbanks, and Alaska as a whole, have also experienced far less unemployment than other states since 2009, and Alaska’s per-person tax burden is lowest in the United States, according to the nonpartisan Tax Foundation think tank. And Hopkins said Fairbanks’ is lowest among incorporated municipal governments in the state.
Hopkins also noted Fairbanks government’s strong borrowing power makes it easier to bond at low cost and thus to hold property tax rates relatively low.
“This is no small issue for our community, and it is also no small issue for our taxpayers,” he said.
The broader Fairbanks community’s per person income holds roughly even with the United States average and about 10 percent lower than in Anchorage, according to 2009 data from the federal Bureau of Economic Analysis. On the flip side is the cost of living in Fairbanks — pegged by one estimate as almost 40 percent higher than the national average.
Contact staff writer Christopher Eshleman at 459-7582.