Haines Borough Mayor Jan Hill said the borough’s 1 percent municipal sales tax for tourism promotion and economic development will be on the agenda at Tuesday’s assembly meeting.
Resident Sally McGuire last month spoke at an assembly meeting and said she was ready to collect signatures to abolish the tax, but said the assembly “should take the lead on this, and it shouldn’t have to be done by a citizens’ ballot initiative.”
“It’s going to be a discussion item (Tuesday) to see what the assembly wants to do with the suggestion,” Hill said. “That’s just the way to get it started; it may go fairly quickly to one of the committees, but we thought we’d have the whole assembly talk about it first.”
The tax was put in place in 1986 to support tourism promotion and has since been extended to cover economic development efforts. It generated $475,268 in fiscal year 2008, $491,090 in 2009 and $460,457 in 2010, and $81,849 to $98,771 of that money went toward economic development each year.
McGuire on June 17 said she is “waiting to figure out what the borough assembly’s going to do” before moving forward with a petition.
“I think that it’s just so much more appropriate for the borough assembly to ask the people, instead of the people having to do it themselves, but whether (Tuesday’s meeting) will affect what we do, I couldn’t say,” McGuire said.
She has said the tax revenues could be shifted into the general fund, but “if I run it as a ballot initiative, I would run it to just plain get rid of it.”
Resident Deborah Vogt said she agrees with McGuire that the dedicated tax for tourism promotion and economic development is an “invitation to waste.”
“I worked 20 years in government in Juneau, department of law, and I’ve watched budgets for years and years, and I think there’s no greater invitation to waste than a dedicated fund, because you can’t spend the money on anything else, so you’ll spend it on what it’s dedicated for,” Vogt said.
She said the tax should be time-limited so voters can weigh in on whether to extend it.
“If tourism can show that they need the entire $350,000 that they get right now, then the assembly can appropriate it, but there just has to be more scrutiny,” Vogt said.
She said the tax could continue to be collected, but for “general purposes,” not just tourism and economic development.
“I’m undecided whether I think we should repeal the whole 1 percent tax and the dedication, or just repeal the dedication part,” Vogt said.
Ned Rozbicki, president of the Haines Chamber of Commerce, said results from a community opinion survey shared at a recent Haines Borough comprehensive plan town hall meeting showed how important tourism is to the local economy.
“I wouldn’t discourage the assembly from looking at (the tax), but I certainly would hope they wouldn’t make any drastic changes,” Rozbicki said. “I think the recent comp plan survey reflected that the community values tourism and wants to see more tourism.”
A survey question about what industry provides the most of residents’ family income had tourism coming in at 15 percent, behind government, 22 percent, and retirement, 17 percent.
“It’s certainly important to make sure funding is intact to support that critical part of the economy,” Rozbicki said. “It’s not the only part of the economy, but I see it as one leg of a three-legged stool, being tourism, fishing and government, essentially, that supports Haines, and it’s critical that we don’t kick that leg out.”