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Petersburg attorney proposes real property transfer tax to diversify revenue
Summary
An attorney from Petersburg suggested the Legislature consider a real property transfer tax, modeled on other states, to capture a small share of property-sale gains and share revenue with local governments.
Juneau — A Petersburg attorney told the Senate Finance Committee on Feb. 26 that Alaska should consider adopting a real property transfer tax to raise revenue from property-sale gains and share proceeds among state and local governments.
Fred Dreyme, an attorney who said he spends time in Juneau and represents clients from Petersburg, described transfer taxes used in states such as Vermont, Michigan and Washington. He said typical rates range from 1% to 3% of the transaction price and noted the tax is usually paid at closing by the seller but remains negotiable between buyer and seller.
Why it matters: Dreyme argued that property values rise in part because of public investments and that a small transfer tax would be a way to capture a portion of those gains to support government services.
Supporting details: Dreyme gave anecdotal examples of longtime homeowners selling properties for substantial gains and suggested modest percentages would raise meaningful revenue without preventing sales. He acknowledged the proposal would provoke opposition from real-estate interests.
Discussion vs. decision: Testimony was advisory; the committee made no motion or vote on a transfer tax during the Feb. 26 hearing.
Ending: The committee continues budget hearings; any formal proposal would require bill drafting and subsequent hearings.
