MUNICIPAL REVENUE SHARING

The Alaska Municipal League urges the State to adopt a sustainable Revenue Sharing program by annually appropriating 6% of all natural resource revenues to municipalities with a minimum of $25,000 to unorganized communities, $75,000 to all municipalities, $250,000 to boroughs, and have the remaining revenue allocated on a per capita basis.

Downloads Revenue Sharing Comparison Chart Revenue Sharing Talking Points

The resources of this State belong to all of Alaska’s people. Cities and boroughs were formed by the State as political subdivisions and are the entities responsible for providing local services to those people. Without municipal revenue sharing, the entire cost of all local services must be entirely on the backs of the local taxpayers. With increasing fuel costs, increasing benefit costs and inflation, as well as the lack of a tax base for smaller communities, local services are being seriously curtailed or stopped. Larger communities are seeing tax increases that are having serious, negative impacts on their residents. The sharing of state revenues is consistent with the “owner” state concept, intergovernmental cooperation and constitutional provisions which provide for natural resource ownership by all the people of the State of Alaska.

During years of high resource revenues, Alaska’s municipalities would realize benefits that would be directly passed on to local residents. During lean years, Alaska’s municipalities would be required to rein in many expenses and/or services, such as the State would have to do under those same circumstances.

While capital funds help communities build needed infrastructure, revenue sharing is the money that helps fund the day-to-day operation of local government. A new water system, funded through the capital budget, will not fulfill its goals if there are no trained operators to maintain the system, city clerks to bill for the system or much-needed fuel to heat the governmental buildings. Cities and boroughs that must impose large tax bills will realize less spending in the community as taxpayers tighten their belts.

Delivery of services at the local level to citizen/owners is part of annual state responsibility to those citizen/owners for the betterment of the State of Alaska.