Study: Mat-Su's Rural Areas Bring in More Borough Revenue than They Spend

Earlier this month, the Mat-Su Borough released the findings of its internal cost of community services study. According to that study, the incorporated cities of the borough generate less revenue for the borough than is spent on borough services, and areas with less development generate more revenue than their services cost.

James Wilson, the borough’s internal auditor, prepared the study. Wilson divides communities into descending categories based on the level of development present: cities, unincorporated areas with community councils, and areas without community councils.

Each area was then analyzed for total revenue generation from property taxes, fees, and other factors. Each community’s total cost of services was then calculated by adding together local service areas, proportional general fund spending, and other, often minor, expenditures. Enterprise funds, such as Port MacKenzie and the borough’s solid waste division are intended to be self-sustaining, and thus would not factor into community-based revenue. Both of those funds are currently running in the red, however.

The results are that, on average, the borough spends $1.17 in Palmer, Wasilla, and Houston for each dollar of revenue received from the cities. In community council areas, the average is ninety-six cents spent for each dollar of revenue. The most rural areas see an average of eighty-five cents in borough spending for each dollar of revenue.

The Upper Valley’s ratio of spending to revenue is slightly lower than the average for community council areas. Talkeetna’s ninety-two cents of spending for each dollar of revenue comes in as the lowest ratio in the Upper Valley. Trapper Creek’s ratio is the highest in the area, but still comes in at five percent more revenue gained than spent.

James Wilson says a comparison of the Mat-Su Borough with eighty other communities shows that the results are not unusual, and that less developed areas often bring in more revenue than is spent on services.