VALDEZ (AP) -- Valdez's city manager Dave Dengel has told city council members that tanker tax dollars could go toward funding a new Valdez Community Hospital.
Dengel is proposing that the $1.9 million in expected revenues from the new tax should be placed in the hospital capital project fund, which currently has a balance of about $700,000.
''We need to protect that money and we also need to build a new hospital. This way it's protected and designated for something that directly affects the health and welfare of Valdez,'' Dengel said earlier this week.
Tanker owners have already paid the first half of their tax bills and the second is due by the end of September, said Mayor Dave Cobb.
The tax, however, would leave the city a long way from funding the new $25 million hospital. Valdez Community Hospital now shares space and a power plant with the defunct Harborview Development Center. State officials want to shut down the power plant.
A task force has studied the need for a new facility and has recommended demolishing the entire building and constructing a new hospital at the same site.
Cobb had said the city had hoped to lower the mill rate with the advent of the tanker tax revenue, but with the threat of litigation by the tanker owners, the city must keep the money in an accessible account.
''Putting it in the hospital fund is an excellent idea,'' Cobb said.
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