In both cases, assembly members said their goal is to avoid tax hikes that increase the burden on those who can least afford it.
Tristan Guevin sponsored the tobacco tax hike. But he said he was having second thoughts.
“After doing research, it does put an additional burden on low income populations, who smoke at a rate of about three times those in the upper middle class,” Guevin said. “And for me, I think putting these quick fixes in places doesn’t address the bigger issue of a more equitable tax structure.”
A pack of Marlboros at Sitka’s AC Lakeside grocery store costs $9.39 before sales tax. About $1.25 of that is the current tobacco tax. Doubling that tax would bring the total cost to something like $10.60.
Guevin also said he’s uncomfortable with the tobacco tax because by law, it’s earmarked for Sitka Community Hospital. The Assembly originally started looking at tax increases to fund a shortfall in the School District, and Guevin said it’s not clear there’s an equivalent public appetite for raising taxes to support the hospital.
Sitka Community Hospital is still digging out from a financial crisis this winter, and it’s counting on funds from the increased tobacco tax to get through the coming year. Steven Eisenbeisz said he’s not happy with that.
“To me it’s imperative that the hospital work under a balanced budget,” he said. “I don’t think it’s fair for them to continue coming back to the citizens to want subsidies. I think it’s important for them to operate within their means.”
The Assembly voted to postpone any decision on the tax until after they can hold a second work session on the hospital budget, on May 19.
The Assembly also postponed a proposal to place a measure on the October ballot increasing the summer sales tax from 6- to 7-percent. That extra revenue would go into a fund dedicated to the Sitka School District. Ten people spoke in favor, including local parent and pediatrician Jennifer McNichol. She called the current school budget “frightening.”
“It already has cuts in it that I and other parents don’t find acceptable,” she said. “But we don’t seem to find any other way around them…Good schools keep families in this town. I think we just do ourselves a huge disservice to allow our school system to deteriorate.”
Nobody spoke against the summer sales tax increase. But assembly members decided to hold off anyway, until they can consider other longterm options to fund the school system — including, potentially, a property tax hike.
You can find more coverage of the Sitka Assembly here.