Opponents of tax cap initiative launch information campaign

Posted: Wednesday, July 12, 2000

ANCHORAGE (AP) -- Opponents of a statewide ballot initiative that would cap property taxes have launched a drive to fight the proposal.

Members of the group, Alaskans United Against the Cap, said at a news conference in Anchorage Tuesday that the proposal to cap local property taxes at 10 mills would have a disastrous impact on the entire state.

Most of the larger cities in Alaska have tax rates of more than 10 mills. In Anchorage, which has a rate of 18 mills, the owner of a $100,000 house would pay $1,800 a year. City officials say the tax cap would cost the city $80 million a year.

The measure is similar to one passed in California's 1978 tax revolt. Sponsors of the initiative say Alaskans are desperate for property tax relief. They collected about 40,000 signatures -- nearly double the number needed -- to put the measure on the ballot.

But opponents of the cap said that, unlike California, Alaska doesn't have an income tax or state sales tax to make up for the lost revenue.

''It's poorly written and poorly thought out,'' said Ernie Hall, an Anchorage businessman who chairs the group. ''It was bad for the state of California, it will be devastating for Alaska.''

Putting a lid on property taxes would probably result in numerous other taxes and user fees as state and local governments try to make up the lost revenue, Hall said.

Opponents said the measure would hurt schools and other essential public services, hamper economic development and would take away local control of taxes, said members of the group.

Jim Crawford, who heads the tax cap drive, did not return a phone call seeking comment Tuesday.

With four months before Alaskans go to the polls to vote on the measure, treasurer Gene Storm said the group hopes to raise about $250,000 for a statewide information campaign.

Among those leading the effort around the state are Phil Younkers of Fairbanks, Nome Mayor Leo Rasmussen, Juneau Mayor Dennis Egan, Katie Hurley of Wasilla and Mike Williams of Akiak.

''If it's not good for Anchorage, it's not going to be good for rural Alaska,'' said Williams who chairs the Alaska Inter-Tribal Council.

Organizers said the tax cap would increase competition for state funds and rural Alaska, lacking in political clout, would be shortchanged.

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