Anchorage Mayor Dan Sullivan delivered a shot across the bow to the city's employees when he unveiled his proposed 2011 budget Oct. 1.
Sullivan said he will not support any tax increases that would be needed to maintain the city's current services and employee levels under current labor contracts.
"We can't — and shouldn't — tax our way out of this problem," Sullivan said in a statement.
He proposed spending $435 million, which is $14.8 million less than needed to fund baseline services and $12 million less than Anchorage could collect under tax-revenue limits in the city charter.
Sullivan said the biggest drivers in spending growth are "generous" labor contracts adopted in 2008 — before he was mayor — plus higher costs for employee health insurance.
Employees' jobs can be saved if those contracts are renegotiated, according to Sullivan.
"Union members could eliminate the possibility of layoffs by taking an across-the-board cut, which undoubtedly would save jobs," he said. "Bottom line, we need their help."
