Don’t kneecap the Assembly

As my first column for the Juneau Independent, this has been a tough piece to write. I want to talk about the tax ballot measures proposed by the “Affordable Juneau Coalition,” and why I think they are bad propositions for Juneau, bad at any time, but particularly bad right now in this fraught moment in the history of our democracy.

There are major mathematical and policy issues with the two tax measures that the proponents do not address at all. If I’ve learned anything, however, from years of technical writing, it’s that many readers may not have the patience to even wade through the phrase “mathematical and policy issues,” let alone follow two sets of arguments. I have probably lost half of my readers already.

But bear with me, reader. What follows is critical to understanding how we maintain the community that we know and love.

The first ballot measure is a charter amendment to cap the basic property mill rate at nine mills. Proponents claim that this amendment won’t even affect city spending now, as the existing basic mill rate is 8.96 mills. 

Quick municipal math: The mill rate works in tandem with assessed property values; the mill rate multiplied by the property value determines the tax for each property. Often as one goes up the other goes down.

Assemblies can choose to raise the mill rate if property values decline or if costs to run the city increase.

Assemblies can also lower the mill rate if property values are high, which the Assembly did in 2023, choosing a mill rate of 8.96 mills to provide property tax relief because property values in Juneau were at a historical high. That 8.96 mill rate itself was a historical low, the lowest in decades.

Capping the mill rate at nine mills, as proposed in the charter amendment, removes a critical part of the equation that balances mill rate with assessed property values. The equation no longer works. If the Assembly is kneecapped in what is arguably its most important job, setting the budget, the elected Assembly will be left without a critical tool in its budget-setting toolbox. 

When, not if, assessed values go down and the mill rate is capped at 9%, the property tax revenue that is critical for funding our city and schools will go down. When, not if, the state and federal governments stop funding critical services like schools and disaster relief, the Assembly won’t be able to fund them.

The second ballot measure put forward by the coalition is the proposal to exempt food and utilities from sales tax. This sales tax exemption on food and utilities is straightforward: We won’t pay sales tax on these items. 

Quite notably, however, the cost of the Affordable Juneau Coalition ballot measure’s sales tax exemption is an estimated $12 million per year. The Affordable Juneau Coalition proposes nothing to replace that lost revenue.

The cost of the combined ballot measures will run into the tens of millions of dollars in lost revenue every single year. Proponents don’t say which services should be cut to compensate for these losses. They instead point to CBJ grants or projects that they don’t like. They don’t talk about what these grants cover, like homeless services or youth activities. 

They don’t tell us to expect more potholes in our streets, or to expect the Augustus Brown pool to be shuttered, or a library near you to be closed. They don’t tell us we’ll no longer be skiing at Eaglecrest or skating at the Treadwell Ice Arena. They don’t tell us that we will no longer be able to find police officers or fire department staff because we just can’t pay them enough. 

The Assembly is working now to exempt food and utilities from sales tax and to implement a seasonal sales tax to make up the difference. The Assembly’s change is the one I support. It will help compensate for the sense of loss that many feel with so many tourists in town by asking those tourists to pay a little more in taxes; it will help us all, but especially those with less money by removing that regressive sales tax on food and utilities; and it will do so without hammering the city budget.

The timing of these ballot measures is appalling. We are experiencing real cuts to federal jobs and funding already, and we face the threat of much more severe cuts in federal funding. We face the loss of FEMA, the loss of additional federal jobs, the slashing of social service grants, and the decimation of our hospital through the cutting of Medicaid and Medicare, among innumerable other cuts and losses now and in the future.

This is a time of unprecedented uncertainty at every level in our country. The two tax ballot measures are utterly tone-deaf to this uncertainty, as are their proponents. If the measures make it to the ballot, vote no.

• Michelle Bonnet Hale’s roots go deep in Juneau and Southeast Alaska. She and her partner share their household with various relatives and three dogs. She served for six years on the Juneau Assembly.