Girdwood Roads Maintenance and Operations Expense Analysis Years 2000 - 2011

By Jim Henderson
Special to the Turnagain Times

The Girdwood Roads Maintenance & Operations (M&O) expenses included in the local Girdwood area taxes each year increased from $239,489 to $794,800 over the last 11 from 2000 to 2011. This is an 11.52 percent per annual increase in M&O expenses over that period.

Money saved when expenses are less than budgeted is transferred to the Girdwood Fund Balance. In 2007, the GBOS approved $200,000 of this money accumulated in the Girdwood Fund Balance to be used to reduce the 2008 property taxes imposed in the Girdwood portion of the Municipality of Anchorage property tax bill.

In late 2008, an unplanned and unbudgeted expense in excess of $150,000 was incurred for partial resurfacing of Arlberg Road. This caused a large blip in expenses over budget. The more than $150,000 was withdrawn from the Girdwood Fund Balance and moneys designated for the GVFD Vehicle Replacement Fund. These shortages are now being recovered by higher taxes levied on Girdwood property owners.

Early in 2008, the road supervisor negotiated a Letter of Agreement (LOA) with Aurora Towing to provide towing of abandoned vehicles and hauling of Girdwood commodities such as bags of calcium chloride, culvert pipes, etc for $100 per one-way load.

Since the departure of that road supervisor, in late summer of 2008, the community has been charged between $250 and $300 per car towed plus a lot more for loads destine for Girdwood. This is the same amount Parks and Recreation has been spending for several years in spite of the LOA.

Recently, road supervisor John Gallup stated, “The cheapest towing available to Girdwood was Vulcan Towing.”

The amount the community is spending per tow is around $300. In the last six weeks, five local towing companies were called to tow a large abandoned car from Girdwood to the crusher. Anchorage Towing quoted a cost of $160 per car. Vulcan Towing said it would cost $200 per vehicle.

Where did the extra $100 to $140 dollars go that the community has been spending? It was also discovered that the Parks and Recreation Department (P&R) has been charging expenses to the Girdwood Road Maintenance Budget for years.

What other charges have not been discovered that may have driven up the costs of the Girdwood road maintenance?

The Girdwood road maintenance contract is open for bid every 3 to 5 years. The road maintenance contract was last opened for bid in the fall of 2010. Past competitive bids have reduced the per hour cost for equipment used in the maintenance of Girdwood roads, streets and walkways. There have been arguments about quantity and quality. You will have to be the judge.

The 2010 maintenance contract bid for 2011 through 2015 was 36 percent less on an equivalent equipment utilization schedule than the previous maintenance contractor’s rate. Road supervisor

Gallup was asked in the GBOS budget hearings in October of last year if the new maintenance contract cost savings would be passed on to the Girdwood tax payers in lower taxes. Gallup said “No, the savings would be spent on other things.”

The Girdwood Road Maintenance and Operation budget for 2011 is 17.57 percent higher than the 2010 road maintenance expenses.

Sadly, Girdwood may not be exempt from the same maladies many other communities have experienced with self-serving and unethical service providers, public servants and elected public officials?

Justice Brandeis proclaimed, “Sunlight is the best disinfectant.”

Note: The budget to actual data for the years 2000 - 2010, upon which the analysis, charts and graphs were based, was provided by the Controller Division of the Municipality of Anchorage. The 2010 M&O expenses were for the full year, through Dec. 31, 2010. The 2011 budget expenditures included in the analysis were approved by the GBOS in October of 2010.

Jim Henderson is a former Girdwood Board of Supervisor. He has 28 years of experience in financial analysis, specializing in insurance, financial data, valuation expertise and financial forensic analysis providing expert testimony in these areas in the US legal systems.