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Imperfections exist, prop 1 not the answer

Posted: Friday, October 03, 2008

Proposition 1

Shall Initiative Ordinance 2008-02, calling for a seasonal (Sept. 1 to May 31) exemption of all sales of nonprepared food items from borough sales tax, be enacted? This ordinance would prohibit sales tax on all sales of nonprepared food items from Sept. 1 until May 31 of each year. These food items exempted from sales tax include those which have been previously granted exemption in KPB 5.18.200(14) for food purchased with coupons issued under the federal food stamp program.

YES [A "YES" vote will approve the exemption and means that nonprepared food items will be exempt from the borough sales tax from Sept. 1 of each year and continuing through May 31 of the following year.]

NO [A "NO" vote means that the borough sales tax code will remain unchanged.]

Someone once said there's good and bad in everything, and Proposition 1 is a perfect example of that. While the concept is a great idea, the execution may be faulted.

What voter wouldn't want to jump on the "Yes" bandwagon and save money by not paying taxes? No politician is ever elected with the promise of raising them. But in this case, "yes" opens the door to uncertainty.

Ending the sales tax on food seasonally will have consequences for city and borough governments and that means consequences for citizens. With less revenue coming in from sales taxes, hard choices will have to be made: raise revenue from elsewhere (most likely property taxes) or cut services.

Inevitably, if Proposition 1 passes it will hurt residents somewhere. However, with mouths to feed, gas to buy and utilities to pay, it's hard not to make the choice that will make the most impact on a family budget right now because residents need some relief from the high costs hammering them from many angles.

Just as Wall Street is looking to the federal government for a rescue plan, Main Street -- where most Americans live and work -- needs some help from its local government. One way local government can help is tax relief, and this measure will give relief to those who need it right now.

The problem is the high costs taking a toll on individual, family and business budgets also are taking a toll on local governments. They, too, need some help if they are going to continue to offer the services their citizens have come to expect.

With Alaska's coffers flush as a result of high oil prices, one solution is for the state to step up with more money for municipal assistance.

Proposition 1 is not perfect. It comes too quickly on the heels of the borough increasing the sales tax and lowering the property tax rate. It begs the question: Why do we tax food at all? It highlights the need for the borough and its cities to work together on a comprehensive, fair, consistent tax policy.

If you do cast your vote in favor of Proposition 1 Tuesday, please do so with your eyes wide open. A "yes" vote puts a responsibility on voters to use their tax relief wisely and tighten their belts for some tough times ahead.

Proposition 1 is a quick fix to a long-term problem. A tax solution must be well-thought out and, at the very least, more of a win-win situation for peninsula residents than a win-now, pay-later deal. As it stands now, we vote no.



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