Ballot Proposition A: Renew temporary 3% sales tax

4 hours ago

2 min read

By Mark Sabbatini

Juneau Independent

Juneau voters have renewed a temporary 3% sales tax like clockwork every four or five years since 1983. But these are unusual times.

Not much opposition is being voiced to renewing it for another five years among candidates and other people prominently involved in the Oct. 6 municipal election. But after voters passed two tax-cut measures last year, which left the Juneau Assembly scrambling to make budget adjustments this year, local leaders are emphasizing letting the 3% tax lapse will have a far bigger impact.

"The temporary 3% tax is used to fund really the bread and butter of city services," City Manager Katie Koester said at a Juneau Assembly meeting July 27 when members voted unanimously to place it on the ballot. "One percent is spent on operations, including police and fire. One percent is spent on streets and drainage projects, so rehabilitating all those streets, and we've added some utility projects to that list as of late to again keep up with those utility projects. And then the other 1% goes to other needed (capital improvement) projects — often, again, parks and playground maintenance."

Among the eight Assembly candidates on this year’s ballot, only one said he plans to vote against the tax during a televised forum Sept. 16. Members of the Affordable Juneau Coalition, which spearheaded last year’s tax-cut measures, are not opposing the renewal of the 3% tax this year.

Voters most recently renewed the tax in 2021 by a vote of 6,580 to 1,786. It was renewed by a similar margin in 2016, but residents also opposed making the tax permanent by a vote of 2,781 in favor and 5,486 against.

Juneau also has a 1% permanent sales tax and a 1% sales tax for special projects that is up for renewal in next year’s election.

The current 3% tax extension is set to lapse on June 30, 2027. If voters renew it the new lapse date will be June 30, 2032.

The city, at an official ballot proposition FAQ webpage, states if Proposition A fails Juneau’s sales tax will drop to 2% as of next June 30. That assumes a 1% seasonal sales that is also on this year’s ballot is not in effect.

"Sales tax revenues would be expected to decrease by approximately $34 million annually," the FAQ states. "Available funding for general city services and capital projects would be reduced by about $23 million and $11 million, respectively. To balance the budget, the Assembly would either make budget cuts, increase revenues, or both. Cuts to general services would be substantial."

The city’s total general fund budget for the fiscal year that began July 1 is about $545 million, which includes roughly $150 million for municipal government services and operations, and about $58 million in capital improvement projects. The total budget also includes entities such as the Juneau School District, Bartlett Regional Hospital and Juneau International Airport.

• Contact Mark Sabbatini at editor@juneauindependent.com or (907) 957-2306.