By Glen Thompson
June 29, 2006
Mr. Dial's letter is quoted in black, rebuttal in red:
With the consolidation vote quickly approaching, supporters have been surprisingly quiet. Perhaps it because discussion of the true consequences of consolidation is something they would prefer you not think about.
The Ketchikan Charter Commission has been anything but silent. We have conducted public, televised meetings and have had extensive press coverage for the past two years.
The following information is completely true, and is based upon a review of the Current Consolidation Document (over 200 pages long), October 2005 amendments to the Consolidation Document, State Statues, and news archives.
This statement is taken out of context. The original budget had no tax increase but the City demanded that we include the expected effect of the $5 billion under-funded liability for state retirement plans. This liability is there regardless of consolidation and it amounts to about $2 million combined between the City and Borough, which is equivalent to 2 mils. We added the projected expense and the necessary taxes to our original budget. This is, however, a projection. Actual figures may be quite different, and since the KCC did not have the liberty of utilizing reserve funds, the actual budget could be quite different than the projected budget.
We are the first to admit that cost savings are minimal due to our attempt to keep status quo on government services and allow a new sitting assembly the latitude to set the budget. The true benefit of consolidation lies in unity.
This statement would be true if the bodies had similar functions and did not compete for limited state and federal resources. History shows that the two bodies have an extremely hard time agreeing on priorities and the result has been rancor and hard feelings.
This is a silly and inflammatory example. More efficient means we would be unified and cohesive rather that divided and argumentative.
Actually the projected cost savings have decreased 45% to about $500,000 per year mostly because our current petition did not cut travel, training, audits, dues, supplies, etc. KCC did not attempt to cut combined staffing beyond the obvious duplication which is primarily at the executive level.
Same comment as above regarding 2 mil tax.
What it actually means is that the proposed areawide tax structure is approved if consolidation is approved. This means the 1% Hospital tax is extended areawide, along with creating a uniform transient occupancy tax (bed tax). Property tax rates have to be set annually like they are now. In general, any increase in taxes requires a super majority vote (5 of the 7 members) of the elected Assembly.
This statement is somewhat misleading. Sales taxes currently require a vote of the people in the 2nd class borough (not in the city), property taxes, however, are set by both the city council and the borough assembly annually with no vote of the people.
There is a "property tax cap" in the borough. It was set by vote of the assembly and can be revoked by a simple majority vote, so it is pretty worthless. Under state law, property tax cannot exceed 30 mils. There are many reasons why the tax cap in the original petition was ultimately found deficient, however in its place we actually increased the hurdles that an assembly must overcome to increase any tax, not just property tax. Instead of a simple majority that is currently required, the new charter requires a 2/3 majority of the total Assembly to raise taxes.
Consolidated municipalities differ from unified ones. The City is currently a first class, home rule city. The new borough would be the same. It means that it is governed by a charter rather than simply defaulting to state law which governs 2nd class communities. A unified home rule municipality is another entity altogether.
Again, the consolidated government in Ketchikan is NOT going to be a Unified Home Rule Municipality. Higher home sales prices translate into higher assessed value and thus higher property tax revenues. Also, while Anchorage has a high property tax rate, they have no sales tax, so a direct comparison is moot. Juneau already has a property tax and sales tax rate that is similar to Ketchikan's.
Lt. Dial is again taking items out of context. The state of Alaska is on record stating:
legislation that could require municipalities to provide certain
services would have the same effect regardless of consolidation.
In any event, given that the AST has spent millions on its new
facility in Ward Cove; that Ketchikan is the hub for commerce,
communication, transportation, and medical care in SE Alaska;
that Ketchikan is a border town and seaport; it is highly unlikely
that the troopers have anywhere better to locate.
...Still not convinced that Consolidation is a bad idea? Consolidation will also negatively effect our senior population.
The Consolidated Governments of Juneau and Anchorage, have both worked toward elimination of tax exemptions for seniors. Both communities view senior tax exemptions as unsustainable and unfunded liabilities. As previously discussed, consolidated / Unified Home Rule Municipalities are far more expensive than our current form of Government. If consolidation passes, you can expect the newly formed government to do exactly what Juneau is doing RIGHT now; elimination of senior tax exemptions. The following articles can be viewed in their entirety by going to the Juneau Empire website..
This is pure speculation. The state would have to pass legislation to eliminate the property tax exemption. It is an unfunded mandate by the state and not popular with any property taxing authority since they regard it as lost revenue. It has absolutely nothing to do with consolidation. Sales tax exemptions fall in the same category; they are subject to the whim of the respective elected bodies.
Most, if not all, of Lt. Dial's reasons for not supporting consolidation are not related to consolidation at all. Currently, in fact, property taxes locally could increase to 30 mils with a simple majority vote (4 of 7) by the assembly. The real issue here is local control over our government and fewer "politicos" to deal with who would actually vote to raise our taxes. Having two governments that often work at cross-purposes with each other is irrational for 13,000 people on an island.
About: Glen Thompson is Chair of the Ketchikan Charter Commission, Borough Assembly Member and Citizen of Ketchikan.
and do not necessarily reflect the opinions of Sitnews.