Assembly delays vote on sales tax

PALMER — The Borough Assembly decided Tuesday night to hold off on a vote as to whether a sales tax ordinance will appear on an upcoming ballot.

The ordinance calls for a 3 percent borough-wide sales tax and a cap of property taxes at 7.8 mills. The cap would reduce the current tax rate, which is currently more than 10 mills. City sales taxes — 3 percent in Palmer, 2.5 percent in Wasilla, and 2 percent in Houston — would be levied in addition to the borough tax.

Assemblywoman Cindy Bettine, who is sponsoring the tax ordinance along with Assemblyman Pete Houston, has said multiple times that the ordinance isn’t about generating more revenue for the borough and is instead a move toward tax diversification, bringing in dollars from folks other than property owners.

“It’s pretty close to revenue-neutral,” she said.

Originally, the ordinance had called for putting the tax to a vote of the people during the borough’s special election set for June 9 to select a replacement for the recently deceased Borough Mayor Curt Menard.

But the very first amendment the body passed was to change that date to put the tax on the borough’s general election ballot Oct. 6.

The assembly passed a string of other amendments before tabling the matter until June 2 — after the assembly has finished hashing out its 2010 budget.

At Tuesday’s meeting, opinions of the tax were mixed. Some asked the assembly to decide on either a property tax or a sales tax, not both. Some opposed a sales tax and others supported it as a means to get relief on rising property taxes.

Representatives from the cities asked for a sit-down with borough officials to go over how the plan will work. That request seemed to gain traction with the assembly members, many of whom cited it as a reason to delay the vote.