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HomeAlaska ElectionsAnother Try at an Alcohol Tax in Anchorage

Another Try at an Alcohol Tax in Anchorage

They’re back.  The Assembly, the Mayor and the local media are back for their third try at an alcohol tax, the second in two years.

The initial attempt to impose a 5.5% alcohol tax floated by Ernie Hall in 2015 failed to get out of the Assembly with a 6-5 vote.

The current Assembly was back at it last year putting a 5% sales tax on retail sale of Alcohol on the ballot.  The proposition failed with 53% of the general public voting no.  I had an article on the tax in APEOnline Nov 2018.  The rationale for defeating the tax has not changed over the last 15 months. 

The Assembly is back, apparently believing that the third time’s the charm.  You can find actual language for the initiative here.  This time around, they’ve tweaked the presentation a bit, dedicating whatever is raised after paying admin, collection and audit costs to the following uses:

Funding for police, related criminal justice personnel, and first responders;

Funding to combat and address child abuse, sexual assault, and domestic violence; and

Funding for substance misuse treatment, prevention programs, detoxification or long-term addiction recovery facilities, mental and behavioral health programs, and resources to prevent and address Anchorage’s homelessness crisis.

All Motherhood and Apple Pie stuff; all on the backs of responsible drinkers of adult beverages in this town.  Roar right on out and vote for that sucker, right?   

Not so fast.

What this Assembly and Mayor are playing is the bright shiny object game, proposing a new tax on alcohol sales that they promise (in not so many words) to solve all the Muni problems that have grown on their watch, during their time in office, presiding over this mess.

What they are not telling you is that money is fungible.  This means that every penny they raise to put in these buckets, is a penny they can quickly swing from those buckets to spend on other things, like turning over public parks, greenbelts, to the homeless, or deploying port-a-cans for their sanitary needs.  Here’s the actual language:

(e)       The net receipts described in subsection (b) shall not be used to supplant funding for existing service levels contained in the actual operating budget for fiscal year 2020 and the funding to provide for and maintain that level of service in subsequent years. The dedicated net receipts shall only be used to provide additional service levels above the 2020 baseline. 

Although the ordinance has language that promises the new money will be additive to current expenditures in these areas for the length of the 2020 operating budget, the Assembly can (have and will) change that budget baseline by a simple majority vote. 

In short, they are very conveniently and cutely executing a bait and switch in front of Anchorage voters, all tied in a shiny “trust me” magical bow.  There is a famous scene out of Animal House on the dangers of “trusting us.”  As the scene is NSFW, I won’t provide the obvious and hilarious link to the video.  As usual, your mileage may vary.

And if we’re dumb enough to trust a group of people who exude incompetence from every pore of their political bodies, we embrace democracy as described in the words of HL Menken:

Democracy is the theory that the common people know what they want, and deserve to get it good and hard. 

The final piece of this ordinance exempts sales taxes on alcohol in the Muni Charter from the three-fifths majority requirement for a new tax, moving that down to 50%+one of qualified voters voting on the question.  Further, like the change in the Muni Charter that allowed Mark Begich to avoid a runoff when he was first elected mayor, both the new tax and the exemption to the three-fifths majority to bust the tax cap immediately go into effect upon passage.  Here’s the actual language:

(b)       Unless otherwise provided in this Charter, no sales tax ordinance is valid until ratified by three-fifths (3/5) of those voting on the question at a regular or special election, except the taxes imposed by Charter § 14.05 and § 14.07 shall be effective if approved by a majority (50%+ one) of the qualified voters voting on the question.

            If approved by a majority of the voters voting on the question at the April 7, 2020 Regular Election, the amendments to the Charter above shall be effective upon certification of the election.

This means they can be back again and again and again whenever there is not quite enough money for this or that or something else.  The proposition should be defeated out of hand for this alone.

Nothing has changed over the last year on this alcohol tax other than promises from a group of people who have demonstrated quite clearly that they no longer deserve our trust.  Put this tax out of our misery.  Also remember the people who are floating this and do your level best to run as many of them out of office as possible in April’s election.  I know I will. 

Alex Gimarc lives in Anchorage since retiring from the military in 1997. His interests include science and technology, environment, energy, economics, military affairs, fishing and disabilities policies. His weekly column “Interesting Items” is a summary of news stories with substantive Alaska-themed topics. He was a small business owner and Information Technology professional.

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