By David G. Hanger
March 23, 2006
For more than a decade the local mill rate has been held down artificially by the influx of tourist sales tax dollars that were allocated to that rather selfish and nefarious purpose. The major property owners are making big bucks off of government improvements; local government in turn expands chronically, particularly as regards cost; and the wealth created by this community infrastructure is diverted to reducing the taxes of the major property holders. Those who have the greatest ability to pay in fact pay next to nothing, while in the meantime sales tax on food, rent and other critical items is locally maxed out.
For the majority of the citizens of Ketchikan, including most property owners, and also including most of the resident employees of the tourist industry, this project as currently proposed is one big ripoff. Hold out for a better deal. As currently proposed, you are not merely voting for a project, you are voting to impoverish yourselves to aggrandize major property holders and tourist operators. That is not rational conduct.
Let us assume for a moment that the assurances of our local government are all true. This $38 million will not cost any of us locally a dime. The tourist industry could leave tomorrow, and the insurance would pay for it all. Let us assume there is no opportunity cost to this project (in fact, an impossibility). Even so, the costs to all local citizens for this project will be substantial. Prices for everything locally will increase beyond the current incredible rates that are being charged; everything locally will continue to go up except your salary.
If this industry is going to be so all pervasive; if this industry expects the community to contribute tens of millions of dollars in infrastructure for its health and well-being, it is only proper that such a gross expectation be conditioned on the premise that the benefits that accrue need to accrue to all the members of this community; not just those in the tourist industry. These major property owners can afford another mill or two hit to their property tax as can the homeowners of the community. By eliminating sales tax on food the benefits of this overwhelmingly pervasive local industry will be distributed proportionally to every citizen of this community in the amount of approximately $300 to $350 a year for each and every individual. By eliminating sales tax on rent the incredibly unfair double burden of taxation imposed on renters will be eliminated. Renters pay the landlord's property tax as part of the rent; part of the game of rentals, the tenants pay the freight. So total of taxes paid: Renters two (2) sales tax and property tax, landlords none (0). There is no sales tax on mortgage payments.
Elimination of sales tax on rent will save tenants an average of $600 to $720 a year. Combined with elimination of sales tax on food a local family of four will save about $2000 a year. That is money that can be spent at places like bowling alleys and at restaurants that stay open all year long.
The landlords of Ketchikan have not been generous with their rents, nor have the grocers been friendly with their prices. The national consumer price index for last year, despite fuel increases, was 2.2%. Rent increases locally average at least 15% since last year and in many instances is up more than 20%. The price on many items at the grocery store is up even more. This further reinforces the need for a fairer distribution of the benefits of the mighty tourist industry. That is best affected by this simple modification to local taxing policies.
Our city government is a pawn of the tourist industry and travels to the tune of its distant drummer. The problem with the cruise ship industry is twofold: 1) It does not do contracts. That way everyone else is perpetually under their thumb. They can tell anyone to go to hell at a moment's notice, including everyone in K-town. To keep them one must fawn and grovel, yet even with your nose buried in the mat, they are whimsical enough to turn their backs on you anyway, or even just because; 2) They are also unbelievably petulant. The desperate timing of our City Council on this measure is determined by the blatant blackmail of reducing landings for 2006 by 100,000 tourists. Since every tourist operator in town has to feel threatened by that maneuver, the pressure on the City Council to mitigate has to be immense. But to cave in rashly to such pressure represents a failure to stand up at least in part to their responsibilities.
With this project we are concerned not just with a physical event, but also with a social and economic event. The physical attribute has been addressed; the economic is disproportionately distributed; and the social attribute has hardly been addressed at all. Because the local operators are threatened by the cruise ship companies with reduced revenues, because our City Council is intimidated therefore and thereby is not sufficient reason to be in too much of a rush about this. From the standpoint of the tourist industry the sooner the better, of course, but this proposal is selfish.
So hold out for a better deal.
Vote no again, and let them squirm awhile. Then come back and
give something to the rest of us. Is it possible our city government
might even momentarily represent its community? (I know, too
much to ever hope for.) 'Give a little, get a lot,' ought be
a message reasonably respected and reasonably granted. Unfortunately,
I do not think any of these people are reasonable.
About: David Hanger is a long
time resident of Ketchikan.
and do not necessarily reflect the opinions of Sitnews.