The Assembly Finance Committee voted Thursday night to let voters decide in October whether or not to raise taxes on cigarettes and tobacco products.
The committee voted seven to one to put a proposition on the general election ballot to raise city taxes on cigarettes from 30 cents a pack to $1, and taxes on all other tobacco products from 12 percent to 45 percent. The ballot measure proposal will be introduced before the Assembly at its next regular meeting. The Assembly has the final say on whether it will go before the voters.
The National Council on Alcohol and Drug Dependence-Juneau asked the committee earlier this month to raise taxes on cigarettes and tobacco to be closer in line with the rest of the state. Anchorage charges $1.30 per pack for cigarettes, and Sitka, Barrow and the Matanuska-Susitna Borough each charge $1.
"The more expensive cigarettes are, the fewer youth start and it delays the age at which youth start," said Wendy Hamilton, tobacco program coordinator for NCADD-Juneau. "Studies have shown across the nation that there is a certain reduction in youth initiation based on how much you go up in your prices. That's our main motivation."
The present tax rate brought in $517,800 for the city in 2008. The new tax rate would bring the total revenue to about $1.69 million a year, or a $1.17 million increase if the Assembly approves the ballot measure and voters OK it in October.
"It's not about money," Hamilton said. "It's about youth prevention."
The Finance Committee debated whether it is fair to raise taxes on a subgroup of the community in order to help generate more funds for the city coffers. The ballot measure proposal has called for using the revenue generated by the tax increase to be used for the Rainforest Recovery Center and social service grants.
Assembly members Sara Chambers and Jonathan Anderson questioned why the money would go toward funding RRC, which primarily deals with alcohol issues in the community and not cigarette cessation.
"They are separate issues," Anderson said.
Both Anderson and Chambers eventually voted in favor of approving the ballot measure in committee because it would allow citizens to make the decision to raise the taxes or not.
Health care and other costs associated with cigarette and tobacco use are a placed on the backs of the entire community even though not everyone smokes, Assembly member Randy Wanamaker said. Tobacco users should be responsible for more of the costs to society, he said.
"They need to help pay for these social health programs," Wanamaker said. "This won't cover all of it but it will go a lot further to covering those costs."
Johan Dybdahl, the lone Assembly member on the committee to vote against the ballot proposal, said the key to getting more people to stop smoking and stopping kids from beginning to start is education. Assembly member Bob Doll was absent from the meeting.
"I don't buy into the whole idea of taxing them to make them quit," Dybdahl said.
The committee could not decide Thursday on the final wording of the ballot measure proposal to bring before the Assembly, so it decided to have acting City Manager Kim Kiefer and City Attorney John Hartle draft an ordinance with the help of Anderson, Chambers and Wanamaker before the next regular meeting.
While smoking a cigarette on Franklin Street on Thursday afternoon, longtime Juneau resident Paul Drake said there are better ways to raise money than taxing tobacco users.
"Why don't they raise taxes on toilet paper? It's equal that way," he said with a laugh.
On a more serious note, Drake said the city could raise the littering fine from $200 to $500 and begin cracking down on the smokers who throw their cigarette butts all over Front and Franklin streets.
"They could stand right here and in one day, in one month, they'd get paid," he said.
Also at Thursday's meeting, the Finance Committee voted unanimously to place an $11.8 million bond proposal on the October ballot for renovations to Gastineau Elementary School. The Assembly also must approve that ballot proposal before it can be put before the voters.
Contact reporter Eric Morrison at 523-2269 or email@example.com.