AK: Here’s how the millions collected from an Anchorage alcohol tax would be spent
Author: Aubrey Wieber
January 26, 2020
As the Anchorage Assembly prepares to vote on two alcohol tax proposals that could be on the ballot for the April 7 municipal election, details of the proposals are becoming more clear.
One alcohol tax proposal is sponsored by Assembly members Felix Rivera, Forrest Dunbar and Austin Quinn-Davidson, and one is sponsored by Assembly members John Weddleton and Meg Zaletel. Both would fund efforts to combat homelessness, although the taxes are significantly different.
Additionally, Assemblyman Fred Dyson is proposing a broad-based sales tax, but he has received little support from other members. Eight votes are needed to put a proposal on the ballot.
On Tuesday, the Assembly will decide on what to send to voters in the April 7 election. Various members have repeated they’re likely to send only one tax proposal to the ballot, if any.
They could also turn all three proposals down. The body as a whole didn’t start shaping the proposals until early January, giving them about three weeks to decide what has the best chance with Anchorage voters.
Despite being a sponsor of an alcohol tax proposal, in an Anchorage Daily News opinion piece Friday, Zaletel suggested the process was rushed and signaled she may not vote for any proposal.
5% alcohol tax:
The 5% tax sponsored by Rivera, Quinn-Davidson and Dunbar is expected to raise $11 million to $15 million. A budget estimating $11.8 million in revenue splits the money into three categories.
- A total of $4.1 million would go to public safety. Of that, $1.7 million would fund six new police officer positions and nine non-sworn support positions for the police department, such as records clerks. Additional prosecutors and public defenders would account for $700,000, and $1.7 million is earmarked for firefighter/paramedics and mental health clinicians.
- Another $3.1 million would be spent on preventing child abuse, sexual assault and domestic violence. The money will be given in the form of grants, with half going to early education grants and half going to abuse prevention providers.
- The largest chunk of money would go to substance abuse prevention, treatment programs and assistance for the homeless. Treatment centers would receive $2 million, and shelters would get just over $2.5 million.
Adjustable alcohol tax:
Weddleton and Zaletel’s proposed alcohol tax would start at 2% and could go up to 5%, based on need. An outline provided to the Assembly shows the tax increasing from 2% to 3% in its first few years.
- In 2021, its first year, the 2% tax would raise an estimated $5 million. About $1.7 million would be spent on behavioral health prevention and response programs. Substance abuse programs would get $1 million. Homelessness prevention and response, including day shelter, overnight shelter and emergency shelter grants for Eagle River and Girdwood, would receive the remaining dollars, which total close to $2 million.
- In 2022, Weddleton and Zaletel propose to increase the tax to 2.5%, generating $6.5 million. Spending on behavioral health prevention would increase by $100,000. Funding for low-barrier overnight shelter beds would triple.
- In 2023 and beyond, the tax would increase to 3%, generating $8 million. Behavioral health funding would increase to $2.85 million. The Alaska Center for Treatment — something Anchorage officials plan to build with funds from the sale of Municipal Light & Power— would get $1.5 million toward operating costs.
At a Tuesday work session, a chief backer of an alcohol tax told members that last year’s proposal for a 5% alcohol tax failed because of industry-funded opposition and a lack of money for a pro-tax campaign.
“I think a large part of that was because there was no well-funded campaign to reverse some of what voters were hearing from the alcohol industry,” said Tiffany Hall, executive director for the nonprofit Recover Alaska.
Hall is heading up fundraising for a pro-alcohol tax campaign. She asked Assembly members to vote down an alcohol tax proposal if she hasn’t raised at least $175,000 by Tuesday’s meeting.
This week, she declined to share fundraising figures, but she said she has raised enough to support the Assembly approving a tax proposal. The alcohol industry has vowed to fight the tax again.
Neither side needs to report how much they have raised until a proposal is on the ballot.