A sales tax increase proposed for Houston would fund parks

Houston voters will see a proposed .5% sales tax increase on their ballots this October, with anticipated revenue slated to pay for city parks, trails and campground updates.

If approved, the increase would bump sales tax in Houston from its current 2% to 2.5% for five years, and would bring in an estimated $150,000 annually, said Houston Mayor Carter Cole. That money would go directly to parks and recreation as a part of a city push to increase and improve public spaces in the city.

“We looked at some of the park areas and Houston really had none. And we were trying to put an effort forward to develop the parks,” Cole told the Borough assembly at a July 18 meeting.

The city currently has three parks: the Little Susitna River Campground, a Little Susitna Public Access area constructed in partnership with the Susitna Rotary and maintained by Houston and the Zero Lake trailhead.

But that’s not enough for the city’s 2,000 residents Cole said -- or to lure visitors and new businesses to the area.

“I really believe once we get the Parks and Rec going, it will actually draw additional visitors to Houston, which will help the business community and our tax structure,” he said.

Outside fireworks sales, most of the typical 2% sales tax is generated through the Three Bears gas station shop, the Houston Lodge restaurant and Miller’s Market, where the line for ice cream can be seen stretching through the parking lot on a sunny summer day. Fireworks, primarily sold within city limits by Gorilla Fireworks, are subject to the 2% plus an additional 2% that is used by law for public safety.

The proposed sales tax increase would not affect marajuana and hemp purchases. Those would remain taxed at 2%, according to the ordinance.

The proposed sales tax bump is part of a series of steps already in motion to work on parks in the city, Cole said. On July 18 the Borough Assembly unanimously approved a plan to transfer to Houston for $6 about 47 acres of Borough-owned land valued at about $258,000. According to the transfer ordinance, that land must be used for parks and recreation.

A plan to spend the proposed tax income was approved Aug. 3 by the city’s parks and recreation planning commission includes updates to the city’s Little Susitna River Campground such as adding water and electric to some RV sites and replacing the playground; developing a city park and playground on Bear Paw Lake; updates to the Zero Lake trailhead and informal camping area; purchasing trail grooming equipment; and hiring a season employee. It goes to the city council for review Aug. 10.

Both steps are pivotal to the parks project, said Cole. For example, the land transfer includes the property on which the city wants to develop the proposed Bear Paw Park.

“It actually is huge for just being able to plan something,” he said. “I’m actually excited for the public to be able to use that and it's really going to be a nice thing.”

Should the sales tax be approved and expected income generated, the city can then double the money through grants from the state and private organizations, which typically require a 50% match from the applying city.

“If we can use those funds as matching to other grants is what we're hoping to do, that will help increase that amount,” he said.

The sales tax measure will appear on the city’s Oct. 3 ballot alongside elections for three open city council seats. Early in-person voting starts September 18 and requests for absentee ballots must be received by Sept. 26. About 10% of the city’s registered voters participated in the previous city election, held in 2021.