The city will continue to let registered nonprofit groups off the hook when it comes to paying sales taxes. But Juneau Assembly members at a Finance Committee meeting Wednesday couldn't decide whether local seniors should keep that same privilege.
The committee discussed recommendations by the 2000 Mayor's Fiscal Task Force that the two sales tax exemptions at least be modified. But the panel ran into shouted protests from seniors in the audience and an admonition by one assembly member that the community's elders don't get enough respect.
"With this exemption, this one little thing, we can show some respect," said assembly member Marc Wheeler.
Further, the gloomy economic prospects that prevailed when the task force was going through its paces no longer exist, Wheeler said. "The budget is balanced and the prospects for next year are good, too. It's just not fair to raise revenue on the backs of seniors."
Committee Chairwoman Cathy Munoz said the committee nevertheless will continue to deliberate four options for the seniors: limiting the exemption to essentials such as food and utilities; issuing a flat annual rebate; raising the eligible age, perhaps to 70; and keeping the exemption.
City staff estimate the exemption costs city coffers $900,000 a year.
A rebate program would benefit the city by cutting down the possibility of exemption abuse - such as when younger residents take advantage of their friends' or families' senior exemption, said Deputy Mayor John MacKinnon. "I have friends - or, rather, acquaintances - who do just that," he said in support of a rebate.
Such a program was last considered in 1996, with the city settling on an annual $227 payback - enough, calculated at the then 4 percent sales tax rate, to cover expenditures on basic necessities such as food and utilities.
Mayor Sally Smith objected to continuation of the senior exemption. "We're in a situation here where there's a reward for having cheated death," she said.
It's difficult to give something that eventually will be taken away, she said. "I'm looking at a reduction of public assistance as I grow older."
Bob Thibodeau, a member of the Juneau Commission on Aging, questioned the Task Force's use of dire economic predictions as a rationale for its recommendations. "There was the (statewide) 10-mill cap (on property taxes) that was predicted to pass, and the prediction that cruise ships would spend less time in Juneau," he said. "This was a scenario of doom. And what do we do with a scenario of doom? Throw seniors to the wolves."
"No seniors were ever consulted on this. You should be ashamed," Thibodeau said to the committee.
The Finance Committee in 1994 approved a senior citizen rebate program after the Commission on Aging recommended it. That program was put off, however, because of a fall ballot proposition that added 1 percent to the sales taxes while exempting food, fuel and some utilities. The proposition failed and the rebate program did not resurface until now.
Testifying Wednesday about his group's recommendations, Task Force chairman and former Mayor Jamie Parsons said it always had been the Task Force's thought that public hearings be held on its recommendations.
Munoz said the committee could hold a public hearing in April. "It appears we have general support to continue the dialogue," she said.
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