Transition documents expose big staffing, financial problems across Anchorage city government, threatening core services

Anchorage Mayor Suzanne LaFrance’s administration is taking over running the city. Migration Report A statement from former Mayor Dave Bronson outlined the significant challenges facing city departments and agencies.

Page 153 The document is a compilation of summary reports from each City department and division. It covers basic functions, budgets, achievements and issues facing dozens of local services.

Across dozens of abstracts, a central theme emerged: Retaining staff and filling vacancies is becoming increasingly difficult. Hindering the operation of some departments. Major financial problems. Along with old and broken vehicles, equipment and software, The basic services that residents rely on will soon be at risk.

LaFrance’s chief administrative officer, Bill Forsey, called it “a very frank and sobering look at the current state of affairs in our municipality.”

“We know we have great challenges ahead in terms of staffing, fiscal consolidation and providing better government for the citizens of Anchorage, and the transition report highlights these very themes,” LaFrance said in a statement.

City services like the fire and police departments have hundreds of employees and nine-figure budgets, while other city departments have just a handful of employees doing unsung jobs that keep the city running.

Director of Maintenance and Operations Shay Sloop reported that the vehicles are aging and without replacement through additional funding, the city’s “ability to provide essential government services (APD, road maintenance) could be imminently disrupted.”

For example, the city has 30 graders for snow removal, some of which are as old as 13 years old, Folsey said, and more than half of them have reached 10,000 engine hours, at which point best practices say the engines should be rebuilt, he added.

In some cases, service disruptions have already begun.

“Our ability to hire, retain or reclassify staff in a timely manner threatens our ability to meet essential community service levels and is reducing staff morale, leading to burnout and a large backlog of work,” Anchorage Water and Sewer Authority general manager Mark Corsentino wrote.

TThe same challengeteeth Similar comments were received from around 20 other departments and organizations.

“Without a significant increase in hiring, staffing continues to decline,” wrote former Anchorage Police Chief-designate Bianca Cross. “Staffing shortages create morale issues and reduce engagement.”

As of early July, the police department had 85 vacancies, meaning about 50 unfilled officer positions out of a budget of 415, Falsey said.

In his transition report, Cross outlined several ways officers are struggling to keep up with the workload, but he also noted that staffing shortages in other parts of city government are hindering police efforts.

“With fewer attorney resources, minor offenses are less likely to be prosecuted, which further exacerbates morale issues when officers turn away repeat offenders,” Cross wrote.

Similarly, several department heads noted that bottlenecks and lack of capacity between departments and agencies were costing the city time and money.

Steve Rivaffo, director of the Don Young Port of Alaska, said staffing shortages in other departments responsible for operations such as legal contracts and purchasing have caused delays that have slowed the port’s modernization project.

Leadership positions are open

There are open positions at every level, from entry level to director, up and down the career ladder. In their transition reports, department heads repeatedly noted that the city government is not paying salaries competitive with similar jobs in the private sector and is failing to attract new workers or motivate current employees to stay.

“We have several vacancies in the (Solid Waste Services) department and while we are working to fill all positions, SWS is unable to compete due to the low hourly wage,” wrote Kelly Toth, acting director of the city’s waste facilities. “The department needs to fill key roles including directors, expeditioners, chief engineers, landfill operations supervisors, mechanics, utility men, skilled laborers, customer service representatives and laborers.”

Falsey said SWS’s vacancy rate is about 17 percent, meaning 21 of 123 positions remain unfilled.

Several board members also noted that a lack of remote work options for city employees has hindered hiring, especially since the COVID-19 pandemic has upended expectations for working in an office.

“Private sector pay scales typically start at the high end of our pay scale,” Planning Director Craig Lyons wrote. “Several highly qualified candidates have not accepted positions or have left the Planning Department because they are unable to work a hybrid schedule.”

Many leadership positions in the city have remained vacant for months to more than a year, with at least seven agencies without a permanent director as of the time of the report.

“The lack of stable leadership in the director role has strained the department across programs,” Toth said in the report.

Twelve departments reported losing expertise as long-time employees retire or resign, and several departments expect further departures in the future.

Falsey served as city attorney and then city manager under former Mayor Ethan Berkowitz’s administration, retiring from those roles in late 2020. Of the city attorneys who worked in the Department of Justice’s civil division at the time Falsey left, he said, only two remain.

“When you have whole departments turning over, things are going to leave and you have to either rebuild your whole system or lose it, so this level of turnover, departures and vacancies really poses challenges for an organization,” Falsey said.

Folsey said he estimates the city has about 2,800 budgeted employee positions, including seasonal and part-time positions, and that there are “hundreds” of vacancies. He said he is working with department heads and the human resources department to determine accurate vacancy rates.

The Parks and Recreation Department has a 23 percent vacancy rate for year-round positions, and about half of the 160 seasonal positions, which are hired from spring through fall, are unfilled.

“There will always be a certain number of vacancies in local government and from my experience I would say the current levels are much greater than what I’m used to seeing,” he said.

Vacancies in the finance department, particularly burnout and high turnover in the audit department, have caused the municipality to be a year late on its annual financial audit for 2022. This has led to a cascade of problems that have put millions of dollars in grant funding and the city’s financial certificate at risk. Self-insurance Reportedly, it’s from the state.

The Fire Department said in its report that the delays “prevented us from complying with reporting deadlines established by state regulations” for SEMT funds, a state-run Medicaid reimbursement program that funds ambulances. The department receives about $23 million a year.

Chief Financial Officer Alden Thurn said the audit was completed Monday and the paperwork needed for self-insurance was submitted to the state just before the final deadline. It’s still unclear whether the fire department’s funding will be affected and if so, how, he said.

He said the 2023 audit process has finally begun, about three and a half months later than usual.

Delays in capital investment

Several departments described growing problems caused by delayed and deferred capital investments in buildings, vehicles and technology. One factor contributing to this trend is inflation; city budgets have not kept up with rising costs, especially after they have skyrocketed over the past few years. Another is a decline in capital flowing into the city; the state Legislature has drastically cut funding allocated to local governments, limiting the city’s ability to raise taxes or issue bonds to make up for funding shortfalls.

The Project Management and Engineering Department reported that the city’s capital needs for basic maintenance and upgrade work exceed $2 billion.

“The loss of state funding has negatively impacted our ability to address deferred maintenance and new infrastructure requirements,” Acting Commissioner Melinda Kohlhaas wrote. “Between 1997 and 2014, municipalities received $512 million in state grant funding for project management, engineering and drainage projects, and only $2 million since then.”

Falsey said the Bronson administration’s report was helpful, and the LaFrance team was able to quickly work with directors and department heads to find potential solutions.

“The transition report underscores the magnitude of the significant challenges we face and creates an urgent need for an immediate fact-finding investigation with the people here who know these issues best,” he said.

He acknowledged that many of the issues are “not entirely new” and that the city has had vehicle and space issues. The difference is scale.

He declined to say why the problem had become so big, but added that he was focused on the future and solutions.

In a statement, LaFrance said he wants to “create an atmosphere of positive work culture” at City Hall and all city workplaces.

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