Kenai Peninsula Assembly discusses sales tax increase to reduce property tax burden

A bold proposal for a broad-based tax to alleviate property tax burdens took center stage at the Kenai Peninsula Borough Finance Committee meeting on July 8, 2025. Advocates argue that increasing sales tax during the summer tourism season could generate approximately $4.47 million, allowing for a significant reduction in property taxes by 0.42 mills.

Supporters, including committee member Miss Cooper, emphasized the potential benefits for families, particularly younger ones, who are feeling the pinch of rising utility costs in winter. "This is a good option," she stated, highlighting that sales tax revenue directly funds education, thereby easing the pressure on the general fund and property taxes.

Conversely, member Chicky expressed skepticism about the need for additional revenue, asserting that the proposal could instead provide a tax break for residents. "We don't need more money," he insisted, advocating for a reduction in the mill rate to help families stay in the area. He noted that the borough is losing younger families while gaining seniors, underscoring the need for measures that make living in the Kenai Peninsula more affordable.

The discussion also touched on the importance of selecting a single revenue initiative for the ballot, as history shows that multiple options often lead to failure. The committee is set to explore this further in upcoming public hearings, with hopes of finding a solution that balances the needs of education funding with the financial realities faced by residents.

As the borough navigates these discussions, the potential for a sales tax increase remains a contentious yet pivotal topic, with implications for both property tax relief and educational funding in the community.