Many council members have indicated they favor such a tax break, but action on any of the reductions won’t occur before they have a chance to look at the city budget sometime this month.
The council repealed a resolution, passed Sept. 11, that would have given full-time residents who qualify for the Alaska Permanent Dividend a 0.5 reduction off their property tax mill rate.
Under that plan, the tax bill for a qualifying resident living on property valued at $250,000 would have been reduced by $125.
The council also postponed a resolution that would drop the mill rate from 4.5 to four mills for all property owners and introduced another version of a reduction that would give full-time residents a $20,000 exemption, similar to what the Kenai Peninsula Borough currently has on the books. That reduction would cut $90 off a tax bill for a $250,000 property.
A public hearing and second reading of that plan is scheduled for the next council meeting on Oct. 23.
In an e-mail to council members last week, City Attorney Gordon Tans said he had some concern that the structure of that reduction may be in conflict with Alaska statutes.
Council member Dennis Novak said that legality and timing were the two main reasons for repealing the reduction.
It is bad business practice to reduce property taxes — a major revenue source for the city — before the council has looked at the budget, he said.
The council voted 4-2 to repeal the resolution, with council members Matt Shadle and Mike Heimbuch voting against the repeal.
Heimbuch, the author of the now-repealed ordinance, said he hopes any property tax reduction will still be tied to residency.
“The end result is arguably the same,” he said. But full-time residents should be entitled to a bigger tax break, he said.
The council is expected to receive a preliminary budget before its next council meeting and will begin work to approve it by the end of the year.
In other news:
• The council postponed action on creating the Ocean Drive Loop Special Service District after hearing testimony from property owners there calling for more discussion. That district was proposed to raise taxes to pay for the maintenance of the erosion control seawall off Ocean Drive Loop Road. (See related story, page 10A.)
• The council heard testimony for and against the creation of a local improvement district for Bayview Gardens. Some residents there testified the road is impassable in the winter and sewer systems in the area are creating a health hazard. But the majority of property owners testified they don’t want the road paved, don’t need sewer, and don’t want to pay for the LID.
• The council passed a resolution supporting the application to the Alaska Recreational Trail Grant Program to construct the W.R. Bell Trail to connect Fairview Avenue to Reber Road/West Hill.
• The council approved the reappointment of Mimi Tolva and appointment of Gail Ann Weaver to the Parks and Recreation Commission.
• The council called for a special meeting Monday to discuss an alleged ethics violation against council member Doug Stark. (See related story, page 1A.)
• The council established a new PERS fund to deposit and save money that has been budgeted to offset future costs of the retirement program so that that money can not be re-appropriated or permitted to lapse into the general fund balance.
Ben Stuart can be reached at ben.stuart@ homernews.com.
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