Opinion: Taxes are necessary

  • Saturday, June 2, 2018 10:02pm
  • Opinion

No one likes taxes.

Well, maybe a few, though we’ve never seen a pep rally on the Kenai Peninsula in support of taxes.

But think about it. Few of us like it when our mechanic says, “This is going to cost you.” Yet we want a safe car to drive, so we pay the bill.

No one enjoys it when the doctor tells us we need an expensive diagnostic test. But we do it because we want to be healthy.

And certainly no one on the Kenai is overjoyed when the state orders an emergency closure to protect weak salmon runs. Yet we comply because we want stronger returns in the future.

It’s the same for taxes. If we want a safe, healthy and strong community — for students, for seniors, for everyone today and tomorrow — we need to pay the bill. And that means taxes.

Of course, that doesn’t mean unlimited taxes. In the case of the Kenai Peninsula Borough, this administration and past administrations, this assembly and past assemblies, have worked hard to reduce spending. However, at the same time, the community wants good schools and dependable public services.

Which brings us to today’s taxing question. The borough assembly at its Tuesday meeting must set the property tax rate and adopt a budget for the fiscal year that starts July 1. Without more revenues, the borough would continue to eat away at its savings — called the fund balance — which is a really, really bad idea. Maintaining a responsible balance is prudent fiscal management.

Just look at the state. Draining savings to avoid a painful political decision is no answer, it’s avoidance.

It’s tax avoidance.

The Kenai Borough’s property tax rate has not changed since 2009. In the three years before then, it dropped almost 20 percent. The borough’s sales tax rate has not changed since 2008. It’s time to face reality that the community needs to pay a little more to be healthy and strong tomorrow.

We recommend the assembly approve the small property tax increase needed for a responsible spending plan. The 0.6 mill increase in the tax levy would add $10 a month to the taxes on a $200,000 home. A lot less than that car repair.

And we recommend the assembly go to voters in October with a reasonable accommodations tax — called a “bed tax.” Anchorage has one, at 12 percent. The Matanuska-Susitna Borough has one, at 5 percent. Most cities and boroughs across Alaska have one. Let’s find something in the middle for the Kenai. The revenues from a boroughwide bed tax on the Kenai could help pay for tourism marketing and economic development, both of which generate more jobs and more sales tax dollars.

And, maybe revenues from the bed tax could be used in future years to roll back a portion of this year’s property tax increase.

We recommend the assembly leave the basic sales tax alone. Cities are looking at their own sales tax rate as the best option to pay for increased local needs, and no sense the borough and cities stacking rate hikes on top of each other.

We encourage the assembly to trust that the community will support a responsible tax plan. We all owe it to ourselves and our neighbors.

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