An ordinance removing required voter approval to increase the borough’s sale tax cap will be introduced at Tuesday’s Kenai Peninsula Borough Assembly meeting.
The ordinance, introduced by assembly members Kelly Cooper and Kenn Carpenter, would not raise the sales tax cap, which has been $500 since 1964 when the borough was established.
Prior to 2005, voter approval was not required to increase the cap on the amount of sales subject to the borough’s sales tax.
In 2005, voters approved an initiative imposing a requirement that any increase in the maximum sales tax may not take effect until ratified by voters during borough elections.
In a May 23 memo from Cooper and Carpenter, they said $500 in 1964 would be worth $3,222, due to inflation.
“In the last few years increased sales tax and property tax exemptions, reductions in state funding for schools and local governments, and the ongoing needs for borough services have made it increasingly difficult for the assembly to balance the budget,” the memo said.
Two recent attempts to raise the sales tax cap failed at the ballot, according to the memo.
If the ordinance passes and the assembly seeks to increase the sales cap, it would accomplish that through the standard public process, where members of the public would have the opportunity to comment on the proposal.
The public will have the opportunity to comment on this ordinance at the July 2 assembly meeting.
