The Wasilla City Council will on July 29 take up a resolution that opposes a proposed Matanuska-Susitna Borough ordinance that would place a 1.5 percent areawide sales tax to pay for transportation projects.
The tax would go into effect on July 1, 2022 for five years or until $73.6 million is collected, after which the tax would expire.
The sales tax question would be on the Nov. 2 regular borough election ballot, if passed by the Matanuska-Borough Assembly at its Aug. 3 meeting.
Then, if borough voters agree, the 1.5 percent areawide sales tax would be added to the Wasilla 2.5 percent sales tax for a total of 4 percent, which would harm Wasilla, especially when the City of Wasilla comes to voters to ask for a future project to be paid for by its forward-funding, no-debt method of paying for capital projects.
“Though the City is not opposed to infrastructure improvements, the 22 projects listed in MSB Information Memorandum No. 21-155 provides for only two projects within the City of Wasilla with a total cost of $5.5 million or 7.4% of the total bond package of $73,685,000.
Wasilla consumers would bear a disproportionate burden for the borough tax, as Wasilla is the economic powerhouse for the borough.
“Further, the MSB does not address the fiscal impact, administration of, or collection of a 1.5% areawide sales tax, which further undermines cities within the Borough and citizen confidence,” the report says.
“With the MSB currently generating revenue from the City of Wasilla in the form of property tax ($11.5m), cigarette tax ($4m), bed tax ($150k) along with alcohol tax and motor vehicle tax, an additional areawide sales tax ($12.5m) would be excessive,” it continues.
“The City of Wasilla has a proven track record with our citizens, where we have completed three major projects: The Curtis D. Menard Memorial Sports Complex early debt extinguishment, Library, and the Wasilla Police Department,” the Wasilla staff report says.
The City of Houston City Council has also approved a resolution opposing the tax.
The Wasilla City Council meets at 6 pm on July 29 at Wasilla City Hall.
Too bad Dunleavy vetoed the 100 mil from the SOA in capital improvements for Mat-Su along with the 1100 PFD.
I’ve been saying Mat-Su isn’t safe from liberal creep. It’s infested Anchorage and has long eyed spreading your way.
Radical leftist statism and social revolution are the REAL pandemic threats, not just to Alaska but to the whole USA and indeed the world. And like the Terminator, they will never stop, never relent, and never quit until all freedom is dead.
The City of Wasilla is good at imposing taxes for their pet projects but has always opposed projects for the betterment of the borough as a whole. One can argue that the city projects benefit the whole borough, which is legitimate, but to oppose a borough tax because Wasilla got what it wanted and doesn’t want to have to pay taxes for the rest of the borough is disingenuous.
I live in the borough. I shop in Wasilla. I pay sales tax to Wasilla. I think the people of Wasilla should help support the rest of the borough by supporting the borough wide sales tax. We are not second rate citizens at the mercy of the elitists that run Wasilla.
Or are we?
No matter what they say, these kinds of taxes NEVER “expire”. There is always something else to spend those dollars on once the first goal is reached. Transportation may be a worthy recipient of tax funding, but keeping the money reigned in to only those initially outlined projects would need to be watched with a hawk eye.
In this case extension could not happen without voter approval. I would much rather pay a sales tax than income tax. The funds generated would be for infrastructure, the real kind, as in roads and road related. Public safety and infrastructure are what government is supposed to be responsible for.
As a second class borough, MSB currently doesn’t have areawide sales tax or transportation/roads authority. The proposed ordinances would grant that authority. Borough roads are currently managed and paid for through independently run local Road Service Areas and Road Service Area fees added to property taxes for landowners outside the borough’s 3 cities. Even though the sales tax ordinances state a 5-year, or when the bond is paid off, sunset, who will pay for the perpetual maintenance of these “areawide” transportation projects after construction is completed? If passed, either the areawide sales tax or a new areawide road service fee will become a permanent taxpayer burden.
Another thing to consider is whether all of the projects listed and their proposed scopes are really necessary. Of the $73.685 million total, $8.3 million is for pathways and another $20.095 million is for upgrades with pathways. Mostly located outside the 3 cities, how necessary are these pathways to the taxpayers in the 3 cities who will pay an inordinate share the bill?
I’ll support a sales tax when they relieve the property owners of real property tax
Whaaat? The City of Wasilla is a completely separate municipality from, but in, the Mat-Su Borough. Why should they have to support taxes funding the rest of the Borough to pay for other’s feel-good projects? It’s not disingenuous at all. Just because Wasilla has their economic model in order due to good leadership and planning doesn’t give you or the MSB the right to scam off of their hard work. So what that you choose to shop in Wasilla? Go shop in Anchorage. Worried about being a second rate citizen at the mercy of Wasilla elitists? How about considering moving to Los Anchorage and becoming a wannabe COW (California/Oregon/Washington)?
Silly people spend tax money each spring to clear dirt and dust off the roads and then let the 4 wheelers spread it all over again all summer. Don’t think they need any more $….not too smart!
Tourist think it is crazy too, yet all the valley business they all want the tourist buck.
Borough funds are divided into two categories – areawide and non-areawide. Areawide are taxes collected from the entire borough. Non-areawide taxes are collected from those areas in the borough but outside the city limits of Houston, Palmer and Wasilla.
Houston, Palmer and Wasilla have all voted in their own sales taxes, and people who live outside of those city limits do benefit from the ways those funds are spent – think libraries, parks, campsites, police and sports centers. In return, people who live outside of the city limits also shop in those cities – Fred Meyers, Carrs, Target, Walmart, the cannabis shops in Houston – thereby contributing to those services which the cities fund with sales tax dollars. BUT. Those same people are also paying non-areawide taxes (through your property bill) which fund animal control (the biggest piece of the pie), libraries, economic development and assorted other projects.
There is an alternative here, Borough – you could propose a 1.5% non-areawide sales tax for your transportation plan which would leave the cities out of it (and thereby recognizing the contributions made by the cities to the borough as a whole) and still raise funds for the $73.6 million in transportation funds you want (although it would probably take longer than 5 years). Good luck getting the people to vote for it – how many times has a borough proposed sales tax been voted down in the past?? People do not want it.
And let’s be clear about the City of Wasilla, here, too – the residents who live in the City of Wasilla do not pay non-areawide property taxes, nor does the City of Wasilla levy and collect any mill rate on properties within the City of Wasilla (read their budget books – the city is always self-congratulatory about keeping its mill rate at 0). So if you live in the city limits – or own a business within the city limits – all those property taxes you pay go to the areawide borough fund, road service areas and fire service areas.
***For the City of Wasilla to say that there’s isn’t a big enough benefit for the people who live in the city limits while using the phrase “Wasilla consumers,” (most of whom live outside of the city limits) – if the borough sales tax is passed – is the pot calling the kettle black. Wasilla consumers (not residents) bear a disproportionate burden in regards to the City’s sales tax and it is two-faced to make one point without acknowledging the other.***
Think of everyone you know who lives outside of the city but shops in the city – the people who live within the city limits, then, disproportionally benefit in a positive way from everyone who lives outside the city but shops there.
If everyone who lived outside of the city of Wasilla stopped shopping in the stores there, it seems impossible that the approximately 10,000 Wasilla residents (within City limits) would generate the almost $18,000,0000 dollars annually that the sales tax brings in now.
Wasilla raises approximately $18m/year in sales tax at a rate of 2.5%, that’s about $720,000,000 in sales annually subject to the sales tax – given the number of households in Wasilla (about 3,200 according to the census borough) each household within city limits would have to make $225,000 in purchases annually – almost 3x what households in the Anchorage metropolitan area spent in 2018-19. Taking the math a little further allows the generalization that 35% of the City’s annual sales tax revenue comes from households within the city limits and the remaining 65% of the $18,000,000 – would come from people who live outside Wasilla (city limits). So people who live in the core area, the areas around Wasilla and Palmer, but outside of those city’s limits are being taxed at a disproportionate rate by the cities without having a voice or a vote in how those monies are spent.
Part of me would love to see this proposal make it on the ballot, just so I can vote NO on a borough sales tax AGAIN. On the other hand, the time and resources spent getting it there for a sure fail just seems like a waste of (my) money (again) and further diminishes the trustworthiness of the borough (in my eyes… which wasn’t all that great to start with).
This response might be on par with the actual article. Thank you for that. I do think there is a need for more funding for roads in the mat-su, though. How we should fund those improvements is outside my current understanding. Any thought on a way to keep up our road infrastructure with the growing population? (They are already looking at increasing the design standards of neighborhoods. Thus passing the costs onto the builders, and then owners.) Major roads still need to be built / upgraded, and federal dollars like those that will upgrade KGB are not indefinite. How do we address this fiscal challenge?
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