Assembly links sales tax to lower property ta

Assembly links sales tax to a lower property tax Mayor vetoes
Assembly could overturnMAT-SU — Lowering property taxes is the reason for the proposed Borough sales tax. Last night the Borough Assembly approved a 3 percent sales tax for the October ballot.

Borough property owners would see $24.1 million in property tax reductions. For the homeowner of an average assessed home of $209,000, this amounts to a $711 reduction in property taxes.

If the sales tax is adopted, the areawide mill levy is lowered from 9.98 to 7.3 The Borough has not had a 7.3 areawide mill levy for 20 years. In 1989 the levy was 6.8.

“We are here to reduce property taxes with a sales tax, that is our intent,” said Assembly Member Cindy Bettine, the sponsor of the sales tax.

Assembly Member Pete Houston is the co-sponsor.
“We need to reduce property taxes,” Houston said.

By morning, however, Borough Mayor Talis Colberg had vetoed the sales tax ordinances. “This is not simply about revenue diversification. It is an increase in taxes as evidenced by the amendments and accompanying assembly discussion. The effort to make the tax “revenue neutral” essentially ends after the first year if it happens at all,” Colberg wrote. Mayor Colberg’s full statement is attached. Veto Statement.

A super majority or five votes can overturn Colberg's veto. The Assembly voted 5 to 2 in support of the sales tax. Assembly Members Tom Kluberton and Mark Ewing voted against the sales tax.

The proposed three percent Borough sales tax is an effort to relieve property owners of some of the tax burden for local services such as education, emergency services, and roads.

The Assembly aims to lessen the tax burden by:
• reducing the present areawide mill levy from 9.98 to 7.3—this results in an $18.9 million tax reduction for Borough residents
• giving homeowners a $20,000 reduction in assessed value on their primary home equates to $5.3 million in tax reductions
• creating an “excess sales tax revenue fund” to direct all excess sales tax collections to mill rate reduction in the subsequent year

Assembly Member Michelle Church supported Bettine’s amendment to lower the proposed mill rate to a point where potentially it could have already shaved millions off next year’s budget, if sales tax projections are on target.

“I vote for the 7.30 mill rate. Residents have said over and over, ‘Reduce my property taxes,’ if we come up $1 million short we will make that cut somewhere because that's what residents have asked for,” Church said.

In a recent phone survey by Ivan Moore Research, 62 percent supported a sales tax to offset property taxes. 604 MAT-SU residents were surveyed. Additionally, 77 percent of those surveyed said they would not change where they shop, and 74 percent said they would not change how much shopping they do. Some 83 percent said they would not change how often they travel to Anchorage either. Some 51 percent said they preferred the higher 3 percent sales tax over a 2 percent sales tax if it provided more tax relief.

Assembly Member Rob Wells is glad the issue is brought into debate.

“At the end of the day, voters will let us know how they collectively want to fund local government services. This will leave it up to their wisdom,” Wells said.

Call Patty Sullivan, Public Affairs Director 745-9577 or 355-0103 This email address is being protected from spambots. You need JavaScript enabled to view it. for more information.

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