Combining city's sales taxes make sense

Posted: Friday, May 26, 2000

The Juneau Assembly is floating the idea of combining two temporary sales tax measures - totaling 4 percent - into one to help passage of both taxes. It's an idea that has merit.

Previously, voters cast ballots on two pieces - a 3 percent tax for general government and another 1 percent for special projects. Those projects from the 1 percent tax have included the new police station, and parks and harbors improvements.

Currently, there's a 5 percent sales tax. The other 1 percent is permanent and mandated by the city charter. The idea of having voters cast one ballot for a 4 percent sales tax is to make it a simple up or down vote. Also, separate sales tax ballot questions might lead to voters choosing between the two.

The current 3 percent sales tax is vital to city operations. Without it, Juneau would lose millions of dollars in revenue and be hard-pressed to meet revenue needs. The 1 percent tax has helped pay for some needed projects, as previously mentioned.

This time around, the 1 percent tax will be used to help fund half of Bartlett Regional Hospital's $40 million expansion plan. That expansion would be covered by four of the five year's worth of revenue from the sales tax. Revenue from the fifth year would go toward paying off $7 million in school maintenance and repair bonds.

Those are both worthwhile proposals and we support each. The hospital is a crown jewel for Juneau. It serves not only our town, but much of Southeast and is an important resource. And we all know that school maintenance needs to be a priority.

Of course, the irony is combining the two taxes will probably ensure passage verses the potential that two separate taxes might not. The city simply can't operate without the 3 percent sales tax. And so while voters would almost certainly pass that portion, there's always a concern voters might not want to add another 1 percent tax for other projects - or, even worse in terms of city revenues, pass the 1 percent and not the 3 percent tax.

Because the 3 percent is vital to city operations, and the 1 percent would fund the hospital expansion and school improvements, we believe combining the two taxes will help ensure passage for the revenue we need to meet the city's budget goals and fund these worthwhile projects. Therefore we support the proposal.



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