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Anchorage Assembly members divided on mayor's sales tax proposal

Megan Edge

Anchorage Assembly members are already taking a stance on the possibility of a sales tax in Alaska's biggest city. On Monday, Mayor Dan Sullivan expressed interest in creating a sales tax during his State of the City address at the Anchorage Chamber of Commerce.

"I am not in favor of it," east Anchorage Assemblyman Adam Trombley said Tuesday. "We don't have a revenue problem, we have a spending problem."

Several Assembly members acknowledged they discussed several ways to collect revenue in the city during a summer work session.

The city also led nine different sessions on the topic with civic groups this year. The most-favored way for raising revenue was a seasonal sales tax, said Lindsey Whitt, the mayor's communications director. Such a tax would target tourists during summer months, she said.

About 70 percent of Anchorage's revenue comes from property taxes, said West Anchorage Assemblyman Tim Steele. The ultimate goal of a sales tax would be to lower property taxes, according to some Assembly members.

How much of a tax break it offers property owners depends on how high the sales tax is, Trombley said. In his State of the City address, Sullivan projected property taxes will rise 1.6 percent this year.  

Anchorage voters have nixed a sales tax the four times such proposals have appeared on the ballot recently.

"It doesn't really matter what my stance is. It's up to the voters. I don't believe this community wants a sales tax," said Midtown Assembly member Elvi Gray-Jackson.

Through Nov. 14, the city will host community discussions around Anchorage to explain the purpose of a property tax, something that was never done before previous effots failed. South Anchorage Assemblywoman Jennifer Johnston, who supports the sales tax, said educating the community will help improve the prospects of a sales tax, if the measure reaches voters.

"High property tax doesn't just affect homeowners, though. You pay for it in your rent each month,” Johnston said. "Sales tax gives people more flexibility. If you chose to be a consumer you choose to pay sales tax."

Before a sales tax can be implemented in Anchorage, the mayor must present a proposed ordinance to the Anchorage Assembly. If the assembly approves the ordinance, it's then in the hands of voters, and 60 percent of them must approve a new tax. An Anchorage sales tax could be on ballots as soon as April.

Contact Megan Edge at megan(at)alaskadispatch.com. Follow her on Twitter @Megtedge.