Fairbanks borough fights to keep alcohol tax on ballot

Posted: Wednesday, August 20, 2003

FAIRBANKS (AP) The Fairbanks North Star Borough asked a Superior Court judge Monday to reject a liquor industry association's attempt to keep an alcohol tax question off the Oct. 7 ballot.

The Interior Cabaret, Hotel, Restaurant and Retailers Association sued the borough Aug. 8, saying the ballot question is too ambiguous.

The measure asks voters to levy a 5 percent tax on retail sales of alcohol with ''limited exemptions'' for alcohol sales taxed by the cities of Fairbanks and North Pole.

In its response to the lawsuit, the borough suggests the association is more interested in profit margins than the democratic process.

''Perhaps the 'injury' ICHRRA really fears is voter ratification of a tax they disfavor, and the consequential difficulty in persuading a court to overrule the will of the people,'' wrote assistant borough attorney Joseph W. Miller.

Miller argued that to delay the question for further review would spur a costly special election, and special elections typically have much lower voter turnout than general elections.

For alcohol consumers, the tax would only affect beverages sold outside the city of Fairbanks, which already has a 5 percent alcohol tax.

In North Pole, where there's a 3 percent sales tax, the borough would add a 2 percent tax on alcohol. The net effect is that all alcohol sold in the borough would be taxed at 5 percent.

The borough's plan is to collect the tax borough-wide and remit to the two cities their parts, minus a 10 percent fee.

ICHRRA attorney Peter Aschenbrenner said more details on how that would work particularly details affecting liquor sellers need to be worked out.

For example, sellers ought to know what penalties for late payments and audit requirements the borough would enact, Aschenbrenner said.

''This is not about whether you like or don't like the liquor industry or like or don't like election lawsuits,'' Aschenbrenner said.

In the municipality's response to the lawsuit, Miller wrote that the assembly still has time to change the ballot question and accompanying ordinance if the court agrees that the question is unclear. Therefore, stopping the ballot question is not necessary, he said.

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