Judge approves petition for tax cap

JOEL DAVIDSON/Frontiersman reporter

MAT-SU - Members of the Mat-Su Taxpayer's Association are sick and tired of sitting by while the Mat-Su Borough increases their property taxes; now they are fighting back.

After an eight-month-long battle in court, Penny Nixon and Dennis Oakland on Jan. 10 won approval from Palmer Superior Court Judge Beverly Cutler to move ahead with a petition that seeks to put on the Oct. 4 ballot a proposition to limit the amount that the borough can increase taxes each year.

Oakland is confident there are lots of Valley residents who are upset with how much their property taxes have increased in the last two years. He's also upset with the fact that taxpayer dollars were used for land planning, recreational projects and vehicle cleanup operations he claims are a waste of money.

"A lot of people in this area are not interested in [the borough's] plans," he said in an phone interview Friday.

Oakland acknowledged that the taxes are still fairly low in the borough, but he is concerned about their rate of increase over the last few years.

"We know our taxes are low compared to other places, but we just want to slow that down," he said. "They'll keep increasing taxes until no one can afford to live here anymore."

Oakland and Nixon first filed a petition with the borough during the summer, in hopes of getting a proposition on the October 2004 ballot. That petition was denied. According to a June 14 letter from Mat-Su Borough Clerk Michelle McGehee, that tax-cap initiative reached beyond what the borough had the power to enact.

"[It] could not be enforced as a matter of law," she wrote, "as it attempts to establish a different tax limitation as the one already mandated in the Alaska Statutes."

After Cutler's ruling approving the petition, McGehee wrote Nixon and Oakland another letter, dated Feb. 7.

"I have reviewed the application for a tax cap initiative petition that was submitted to my office on May 26, 2004…On January 10, 2005, Judge Cutler ruled that this matter be placed before the voters at the October 4, 2005, regular election, upon certification of the petition for the tax cap initiative."

By the end of February, Nixon, Oakland and other tax cap supporters will have 90 days to gather 1,788 approved signatures. If they succeed, the tax-cap proposition will go before borough voters in October for a final decision.

The wording of the tax-cap petition is identical to the tax-cap initiative in Anchorage.

"It's verbatim from Anchorage," Oakland said. "We actually used their ballot wording from 1983."

The tax-cap proposal states that the total amount of borough tax that can be levied during a fiscal year "shall not exceed the total amount approved by the Assembly for the preceding year by more than a percentage defined by adding the percentage increase in the Federal Consumer Price Index for Anchorage from the preceding fiscal year" to the average percentage growth or loss in the Mat-Su Borough population over the preceding five fiscal years, as determined by the Alaska Department of Community and Economic Development.

Exceptions include taxes on new construction or property improvements that occur during the current fiscal year; taxes required to fund additional services mandated by voter-approved ballot issues; special taxes authorized by voter-approved ballot issues, and taxes required to fund the costs of judgments entered against the borough or to pay principal or interest on bonds, including revenue bonds.

With a Web site already established at www.taxcap.org, Oakland said he fully expects the initiative to pass in October.

"I don't think this will be a challenge," he said. "There is so much interest in this and it's not just a bunch of conservatives either. This is across the board; there's a lot of people out there who are really mad."

Contact Joel Davidson at joel.davidson@frontiersman.com.