Borough Assembly Members Cindy Bettine and Pete Houston sponsored the sales tax measure and the full assembly voted to put it on the ballot at a meeting in July. Later, the assembly overrode Mayor Talis Colberg’s veto.
In a nutshell the tax measure does three things:
|
|
Second, it caps property taxes at 7.3 mills, which is a reduction from its current rate of 9.98 mills. A mill is equal to $100 for every $100,000 of assessed value.
Third, it exempts the first $20,000 of a home’s value. That means a $200,000 home would be taxed as a $180,000 home.
Proponents and opponents of the measure agree on those three things. But they disagree on most everything else.
There’s the question of tax savings.
According to a borough-generated list of frequently asked questions, the owner of an average home — one worth $209,000, according to the borough — would save $706 in property taxes if the ordinance passes. The borough says that to cover that $706 in sales taxes a person would have to spend $23,533 on taxable goods and services.
Frank Bettine — no relation to Cindy Bettine — is the treasurer for CPG – Ballot Initiative Group, an offshoot of the Conservative Patriots Group that helped organize the series of Tea Party protests against big government.
Bettine says that he doesn’t think the property tax reduction would save anybody much money. How could it, he asks, if the borough will have to collect extra revenue — he estimates $1 million a year — just to run the program?
“The 7.3 mill rate plus the 20,000 you get off of your home would not make up for the extra you end up paying for the sales tax,” he said.
He said he ran his own calculations and found that a person spending $3,000 on taxable goods and services a month would wind up paying $584 more in taxes.
On the other side is Jesse Tanner, a real estate agent and chair of Citizens for Property Tax Relief, which formed to support the initiative. He thinks the savings will be immediate, noting that the amount of money a person would have to spend to eliminate the property tax savings is extravagant.
“You’d have t spend $24,000 in taxable goods and services to make up that difference,” he said.
Then there’s the question of assessments.
Bettine pointed out that it’s the borough that sets assessed value. So, if the borough says your home is worth more you end up paying more in taxes.
“There’s no limit on how much they can increase your assessed value,” he said.
Tanner said he strongly disagrees, pointing out that state law says a property’s assessment is closely tied to a property’s market value.
“To say that the borough is just going to raise assessments is ridiculous,” he said.
He pointed out that assessments, since they’re tied to the housing market, actually went down this year and likely will next year. Borough Manager John Duffy, when he presented the borough’s budget this year, backed up that view, saying that assessments were down about 5 percent in 2008.
And what about the tax’s effects on local business and the economy?
Bettine fears it will drive merchants away.
“We’ve been out talking to the small businesses,” he said. “A lot of them are just infuriated about this.”
He also said now is not the time to raise sales taxes, given the economy is in the dumps.
But Tanner said that historically, economic recovery has come from a rebound in the housing market. If property taxes stay high, fewer people buy homes and the housing market stays in the tank.
As for who benefits, Bettine said he thinks the ordinance mainly benefits the wealthy and hurts the middle class.
“What it looks like to us, when we run the money, is that it’s land developers or people who own multiple properties that are going to benefit,” he said. “Mostly middle income home owners that are going to wind up paying a higher overall tax.”
Tanner disagrees, falling back on the estimates of how much the average homeowner would have to spend to erase his property tax savings.
And what about the chances each side has?
“We feel pretty optimistic,” that the ordinance will pass, Tanner said.
“Our feeling from talking to folks is we think it will get defeated,” Bettine said.
Contact Andrew Wellner at andrew.wellner@frontiersman.com or 352-2270.
Comments
43 comment(s)Sarah ASD wrote on Oct 11, 2009 3:22 PM:
Scottie wrote on Oct 8, 2009 12:38 PM:
Ha Ha... wrote on Oct 7, 2009 2:28 PM:
Funny wrote on Oct 7, 2009 11:12 AM:
Brian wrote on Oct 7, 2009 7:46 AM:
Sovlin wrote on Oct 7, 2009 6:55 AM:
Palmer is running good people away, the crime will come full force. Just a dying town of hardheaded controlling pioneer offspring. You don't have a life you control this town. You are taking Palmer down! "
This frontiersman reporter is way out of touch with the Valley wrote on Oct 7, 2009 12:09 AM:
The frontiersman has a history of trying to prop up liberal causes and races.
I think it is because all the reporters friends are liberal and when he polls his friends they all say they are voting Liberal.
Maybe the Frontiersman should try to hire a non liberal reporter. "
LOL wrote on Oct 6, 2009 10:13 PM:
North Valley wrote on Oct 6, 2009 9:55 PM:
Who says?
SIX times since 1991?
What part of NO don't you big gooberment lovers understand? "
Reality Facilitator wrote on Oct 6, 2009 2:23 PM:
Cell phone tax wrote on Oct 6, 2009 1:38 PM:
to FYI wrote on Oct 6, 2009 12:12 PM:
FYI wrote on Oct 6, 2009 10:49 AM:
Straight Talk wrote on Oct 6, 2009 10:46 AM:
Dont like being TAXED wrote on Oct 6, 2009 10:13 AM:
These cell phone companies don't want to spend the money to identify you as a non-city resident of Wasilla and Palmer and are collecting sales tax from everyone using these zip codes. Hatchers Pass residents are paying Palmer sales tax for phone services. Check your statements. You have the right to mandate a refund. "
thanks wrote on Oct 6, 2009 8:00 AM:
Help to UnDecided ---- wrote on Oct 6, 2009 7:22 AM:
Late to the Party ---- wrote on Oct 6, 2009 7:16 AM:
message to PATRIOT -- wrote on Oct 5, 2009 10:58 PM:
Scott Sez wrote on Oct 5, 2009 9:00 PM:
Renters are not exempt under the first $1000;
$25K, not including rent, is what it costs a wage-earner to live here in the Valley, MINIMUM---spend a penny more, your taxes go up, property owner or no;
There is no cap on assessments, there is no 'cap' on anything but PROPERTY TAX REVENUES;
"Sunset clause" means they don't have to consult the voter to raise the rate after that clause ensues;
Only those Borough Property Owners who do not spend money here in the Valley will see a reduction in tax outlay. Period.
Don;t believe me? READ the BILL! "
Undecided wrote on Oct 5, 2009 4:15 PM:
Trophyman wrote on Oct 5, 2009 2:43 PM:
Dennis O. wrote on Oct 5, 2009 1:01 PM:
Big Lake wrote on Oct 5, 2009 10:23 AM:
aklifer wrote on Oct 5, 2009 10:19 AM:
fishhook wrote on Oct 5, 2009 9:54 AM:
vote NO on the property tax!. "
Lydia wrote on Oct 5, 2009 12:09 AM:
palmeranian wrote on Oct 4, 2009 6:46 PM:
Who made the headline for this story? "
Not Now wrote on Oct 4, 2009 3:59 PM:
long time resident wrote on Oct 4, 2009 3:41 PM:
Burden wrote on Oct 4, 2009 2:03 PM:
I vote NO!!!! "
Hey wrote on Oct 4, 2009 2:00 PM:
to matsu guy wrote on Oct 4, 2009 1:47 PM:
Brian wrote on Oct 4, 2009 1:22 PM:
Matsuguy wrote on Oct 4, 2009 12:11 PM:
Patriot wrote on Oct 4, 2009 10:43 AM:
Valley wrote on Oct 4, 2009 10:07 AM:
Another wonderful story made up in lala land by the Frontiersman
There is NO-WAY...this vote will be too close to call
I'll call it now 85% NO..15% Yes...And thats of just the 12 % that will show up to vote...Imagine if the People really got out and voted...Too close...hahahahahahahahahahahahahahhahahahaha "
Liberty wrote on Oct 4, 2009 8:35 AM:
For Sales Tax wrote on Oct 3, 2009 10:02 PM:
Lee wrote on Oct 3, 2009 9:27 PM:
Im Voting NO wrote on Oct 3, 2009 8:35 PM:
Observer wrote on Oct 3, 2009 7:56 PM:
MD says No wrote on Oct 3, 2009 6:07 PM:
Then lets get one that really cuts property tax. Borough employee bloat with no end in sight. "