Gov's proposal not well received

Posted: Tuesday, March 11, 2003

Response to the proposal in Gov. Frank Murkowski's budget presented last week for a visitor user fees was not well received by members of the tourism industry.

"It's totally ridiculous," said Steve Anderson, owner of Soldotna Bed and Breakfast. "Alaskans should not hold anybody responsible for their own welfare."

A part of the budget proposal calls for a $15 per person wildlife conservation pass targeting nonresident visitors accessing state lands and waters. In his presentation to the Legislature, Murkowski asked lawmakers to pursue a seasonal sales tax as a possible, additional revenue source.

Dennis Novak, owner of the Bay View Inn in Homer, also opposed the proposed tax.

"If it's just going to be used to pay bills, I can't say much good for it," he said.

Anderson said he would probably be agreeable to a seasonal sales tax but said those funds would need to go toward tourism marketing, which hasn't been slated for revenue from the proposed wildlife conservation pass.

"Of course, anything that comes from tourists should go back to the industry," he said.

But this may not be in the books.

The state funds tourism marketing through the Alaska Travel Industry Association in the way of an annual allotment of $4 million. The organization gets another $6 million for marketing from private sector membership fees. Murkowski's budget is identical to last year's budget and reflects no change from the proposed visitor-based tax revenue.

ATIA spokesperson Marc Marones said the organization was surprised the allotment was not increased and planned to ask the state for an additional $10 million to rescue an industry still recovering from the impact of the Sept. 11, 2001, terrorist attacks.

He referred to a 2002 McDowell study that showed that 87 percent of business proprietors contacted said business volume was down.

Neither Anderson nor Novak said it made sense for money taxed from visitors not to return to the visitor industry.

"Anything that taxes tourism should pump money back into the system," Anderson said. "You can't be raping the tourists and not trying to encourage them to come back."

Novak agreed.

"It needs to be used for generating new revenues for marketing tourism," Novak said. "If not, there's nothing progressive about it at all, and it's just a head tax."

ATIA chair Bob Dindinger said he is concerned that Murkowski's proposed tax would make a bad situation in the visitor industry worse.

"We are concerned that the visitor viewing fee is essentially a head tax," he said. "The ATIA historically has rejected targeted taxes because they are not broad based and negatively impact our industry."

Dindinger said ATIA will participate, if requested, at any legislative discussions addressing the proposed issues outlined in the governor's budget.

This week, 80 ATIA members will attend the association's annual fly-in in Juneau to discuss the industry's needs.

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