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.