No tax breaks for box store

March 25, 2005

KATE GOLDEN/Frontiersman reporter

WASILLA - The Wasilla City Council voted Tuesday not to grant the new Lowe's home improvement store a break on its late first tax payment to the city.

Lowe's Companies Inc. filed its first sales-tax return with the city for gross sales of around $19,000, four days late. The December return was due Jan. 31 and arrived Feb. 3.

As per the Wasilla municipal sales tax code, Finance Director Ted Leonard exacted a 5-percent late fee, for $953.22, which Lowe's paid Feb. 23.

But with the payment, the city received a letter from Lowe's certified public accountant Elizabeth Todd Freas pleading for mercy.

Freas said Lowe's had phoned the finance department several times "gathering information and clarifying issues and procedures to ensure our compliance with all of your local laws and exemptions." The company was late, she said, because it was reviewing its compliance extra carefully.

She also noted that of hundreds of returns Lowe's files each month, Wasilla alone requires payments to be received instead of postmarked by their due dates.

Leonard noted in his memorandum to the council that Lowe's had a copy of the sales tax code.

If Lowe's had asked for a waiver of the penalty within five days of its late payment, it might have received a waiver on the penalty from the finance director. Since it waited three weeks, the only means for mercy was from the council.

The council, however, showed none.

Council Member Mark Ewing initially suggested the city could go easy on the store's first payment, but others disagreed.

"I realize that it's their first payment, but I would have expected the first one to be the on-time one," said Noel Lowe.

"I think that as adults, our most memorable lessons are attached to our wallets," said Diana Straub.

The request for a waiver failed unanimously.

Contact Kate at kate.golden@frontiersman.com.