Borough explains new car tax
Haines vehicle owners have expressed confusion and frustration over the recent passage of a $22 biennial motor vehicle registration tax, but executive assistant to the manager Darsie Culbeck said some residents misunderstand how the tax is going to work.
“Someone said, ‘Oh, can I just put my vehicle on the side of the road and the borough is just going to cover the cost of that?’ And that’s not the case,” Culbeck said.
Culbeck has also heard people talking about how they will have to pay the tax on snow machines and boat trailers, which isn’t true.
Every effort is still going to be made to identify the owners of abandoned vehicles, he said. In the cases where the owner can’t be identified or located, revenue from the tax will be used to remove the cars.
“It’s not like it’s a free service that you can just toss your vehicle on the side of the road. If you do that – just like now and just like before – the police will – if the vehicle is towed – try to find out who the last owner was and take them to small claims court” to recoup the cost of towing, Culbeck said.
The public already is paying for the removal of abandoned vehicles whose owners can’t be identified, Culbeck said. They just aren’t doing it through a tax.
“They’re paying for it anyway. If the borough has to go deal with it, we’re going to spend the money to go after those cars. This is just an avenue for us to target the program a little more to people who own vehicles,” he said.
Instead of having a private company charge an exorbitant amount to tow the car and store it for so much per day, the borough might be able to invest in a tow truck and impound yard which could pan out to be cheaper, he said.
The borough can’t just hook up a tow line to a police cruiser and drag a car to a random lot and store it there, Culbeck said. It needs a legal tow truck and an insured impound lot that meets security regulations.
“We can’t tow someone’s vehicle to an impound yard that doesn’t have insurance on it, because that makes the borough – the public – take on a huge liability. If someone’s vehicle gets broken into at the impound yard, we’re on the hook,” he said.
When the borough gave the private sector an opportunity to provide the service, the one bid by Bigfoot Auto Services was inadequate. Still, Culbeck hopes another company might step up and submit a responsive bid if the assembly chooses to give the private sector another shot.
While the tax is expected to bring in $40,000 in revenue per year, where that money will go hasn’t been decided. It will be set aside in a separate fund explicitly for disposing of abandoned vehicles, but the assembly will need to decide how the funds are spent.
Other communities which also have the tax (including Anchorage, Bethel, Cordova, Juneau, Ketchikan, Petersburg, and Sitka) use the revenue for different purposes.
Steve Geisbrecht, manager of the Petersburg Borough, said revenue from the motor vehicle tax there – $33,000 to $34,000 per year – just goes into the general fund.
In Sitka, too, deputy finance director Mike Middleton said the tax revenue isn’t specifically earmarked for anything. Middleton said there was an effort to have the funds specified to go toward road projects, but it failed.
In Haines, the tax will come into effect Jan. 1, 2015, but the borough can spend the anticipated revenue before then. Culbeck said he expects a plan for those funds will emerge before the end of the year.