"We have lost even more money than we even thought we were going to. I feel like it's very fair for people to realize that there are nonessential functions that the city would lose," said council member Beth Wythe, who introduced the ordinance.

In January, by a 4-2 vote, the council voted to put the grocery tax question on the ballot, asking voters to restore some of the sales tax revenue that was lost when the city followed an Oct. 7 Kenai Peninsula Borough vote approving the grocery tax holiday during the winter months.

Two weeks ago, the council got its first look at what effect the tax holiday is having on the city budget. According to a borough report covering the three-month period of March, April and May, the city lost $147,504 in revenue, or about $50,000 per month. Those figures come under a projected budget that already had figured in a $1 million loss for 2009 due to the nine-month loss of grocery taxes.

If approved at the council's June 22 meeting, the information campaign could include "advertisements in print and broadcast media, brochures and posters."

"We need to do this because we need a way to put information out there in a legal way," said council member Dennis Novak."We're going to be down money from sales tax in general, maybe 10 percent overall ... so we're looking at some serious budget cuts."

Part of the impetus for the ordinance, said Wythe, is to comply with a state statute that prohibits municipalities from providing information that "influences the outcome of an election" unless they specifically appropriate funds for that purpose via ordinance.

In April, the Alaska Public Offices Commission slapped the city with a $400 fine for mailing out a two-page brochure, entitled "Questions and Answers about Homer Town Square and the new City Hall," on the eve of a March 25, 2008 bond election. The brochure, said APOC in their ruling, "went beyond the official language of the ballot initiative and did not provide a neutral ballot summary," thereby violating state law.

"APOC didn't smack us because we had an unbalanced report. It was because we didn't allocate funds," said Wythe.

Although the ordinance would give the council freedom to produce and distribute just about any material they wish, Wythe said she wasn't necessarily aiming for a "biased" campaign in favor of reinstituting the grocery tax.

"My objective in putting this out here is that we covered the broadest possibilities," said Wythe, who added that City Attorney Thomas Klinkner helped her put the ordinance together.

Although he voted to introduce the ordinance, council member Bryan Zak expressed reservations abut enacting it.

"I'm a little skeptical about spending this money," he said. "If we spend $5,000 then that's $5,000 that could be going to something else. If we keep finding those buckets of $5,000, we may be able to do something with that money."

Aaron Selbig can be reached at aaron.selbig@homernews.com.