Anchorage Assembly members are floating a ballot measure that would institute a 3% sales tax in Anchorage. If approved, supporters estimate it would generate about $180 million in annual revenue for the city.
Assembly members discussed the proposal at a work session Thursday. Two-thirds of the money generated by the tax would go toward property tax relief, said Assembly member Felix Rivera, who co-sponsored the ordinance. He said, in total, property owners would see a roughly 16% reduction in their annual taxes.
“It’s roughly, per $100,000, we’re talking about $265 relief in property tax,” Rivera said. “And so on your average $450,000 home, that’s $1,195 in property tax relief.”
The last third of the money raised by the tax would go toward building new public projects in the city. Assembly member Randy Sulte, the other co-sponsor of the ordinance, listed a few examples of potential projects: an indoor market and food hall, a new sports complex in East Anchorage and an entertainment district along Ship Creek.
“I don’t want to fund private developments. What I’d like to see is that amenity drives private development around it,” Sulte said. “Ideal scenario, we put in $60, $50 million in the projects and the community invests much more than that over time.”
The proposal is modeled after cities like Oklahoma City, which instituted a similar 1% sales tax in the 90s to fund beautification efforts and new amenities.
Under the proposal, some things would be excluded from the sales tax, including gasoline and other fuel, child care costs and non-prepared food. People would also be only taxed up to $1,000 of an expense, meaning larger purchases like vehicles or generators would garner a maximum tax of $30.
Nolan Klouda, a policy advisor for Mayor Suzanne LaFrance, said the administration is not opposed to the sales tax, and looks forward to continued discussions on how to boost Anchorage revenues.
“We’re not standing in opposition to this,” Klouda said. “We are supportive of the dialogue taking place and not making an endorsement of it right now.”
If approved by the Assembly, supporters of the sales tax proposal ballot proposition hope to put it out to voters during next April’s city election.
