Petersburg Borough Assembly to consider new tax ordinances

The Petersburg Borough Assembly will discuss a number of new ordinances at its meeting tonight that could change the way the Borough taxes.

The General Assembly will consider increasing the maximum amount of a single transaction that the municipality can tax by 24%. Currently, it can only collect sales tax on transactions under $1,200. A new ordinance would increase that cap to $5,000.

That translates to an increase from $72 to $300 per single purchase of goods or services. The Borough has not adjusted the sales tax cap in more than 20 years. And Petersburg currently has the lowest maximum taxable single purchase amount in Southeast Alaska. If the General Assembly approves the ordinance in three readings, it will be put to the public as a voting proposal in the October municipal elections.

That is not the only tax adjustment on the agenda tonight. The General Assembly is also considering increasing the tax on room rental from four percent to seven percent. The temporary room tax is charged on rooms rented for less than 30 days in hotels, motels, lodges and Airbnbs in Petersburg.

The Borough estimates that increasing the tax to seven percent would generate approximately $53,000 in additional revenue. And another ordinance on tonight’s agenda would direct those additional funds to tourism services in the city. This could include things such as information signs, park maintenance and beautification projects in the city center.

The General Assembly will hold a public hearing on both ordinances regarding room taxes during its meeting tonight. If the room tax increase passes two more readings, voters will decide in October whether to approve it.

In other business, the Alaska Department of Natural Resources is about to transfer 1,758 acres of municipal lands to the Borough. Those lands are spread across Mitkof Island and also include three small islands in the Sumner Strait. The municipality has approved the provisional decision in writing. The deadline for the public to submit written comments on this to the Department of Natural Resources is Friday, May 24 at 4:30 p.m.

The Borough also has its sights set on a very different piece of state land, for a very specific purpose. Tonight the General Assembly will consider signing a letter in support of the Borough’s application to take possession of 21 hectares of state tidal land in Scow Bay, where it plans to build a harbor and launch a boat launch. The Borough is expected to receive approximately $4 million in Department of Transportation funding for the project.

The Petersburg Borough Assembly meets tonight at 6:00 PM in the Assembly Chambers. KFSK will broadcast that meeting live and post the recording in our Borough Assembly Archive.