Tax Cap Initiative

Posted: Wednesday, November 08, 2000

ANCHORAGE (AP) -- Alaska voters overwhelmingly rejected a measure that would have capped property taxes statewide at 1 percent of a property's assessed value.

The proposal went down to defeat with more than 71 percent of the voters rejecting it. The California-style tax-cap initiative was one of the hottest issues on the ballot, and helped draw voters to the polls.

''I'm very pleased with the results, very pleased,'' said Ernie Hall, chairman of Alaskans United Against the Cap.

Anchorage Mayor George Wuerch said he was encouraged by the outcome.

''What this says is the spirit of the community is alive and well,'' Wuerch said.

The vote against the tax cap cut across party lines and income levels.

According to a Voter News Service exit poll of 750 Alaska voters, Democrats voted overwhelmingly against the measure. About two-thirds of Republicans and two-thirds of all Independents also voted against the cap.

About two-thirds of those with annual incomes of $15,000 to $50,000 voted against the initiative. About three-quarters of those making $50,000 to $100,000 voted against it.

The results of the survey are subject to a sampling error of plus or minus 5 percentage points for all voters, higher for subgroups.

The tax cap idea started with strong popular support. About 40,000 people signed petitions to put the measure on the ballot -- almost twice the number needed.

But the measure would have cut about $150 million from local budgets across the state. And that raised fears of deep cuts in government services.

Municipal officials across the state warned that schools would suffer, museums and libraries would see reduced hours and streets would remain clogged with snow long after storms.

''Quality of life up here is important,'' said Gena Columbus of Anchorage, while leaving the polls after voting against the cap.

Backers of the Tax Cap Yes! campaign had argued state and local governments could find operating efficiencies and alternate sources of revenue to make up for the lost property tax revenue.

Despite the initiative's resounding defeat, tax cap proponents said homerowners will be watching local government spending more carefully.

''Politicians should not take this vote as a signal to continue the status quo,'' said Eddie Burke, a spokesman for the Tax Cap Yes! campaign.

Indeed, the tax cap crusade already has had an impact on proposed spending in Anchorage. Wuerch has said he would base his budget for next year on how people respond to the tax-cap initiative. Wuerch said that, if the measure fails by a wide margin, he would ease up on proposed spending cuts for Anchorage.

Wuerch said the idea is to show tax-cap supporters that the city is aware of their concerns.

Anchorage, which is home to about half the state's residents, ranked 19th last year in terms of property taxes, according to a survey of the largest cities in each of the 50 states.

The annual survey, conducted by the Washington, D.C., Office of Tax and Revenue, put Anchorage residents at the very bottom of the list in terms of their total tax burden.



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