CITY OF HOMER

HOMER, ALASKA

Novak

RESOLUTION 05-44

A RESOLUTION OF THE HOMER CITY COUNCIL EXPRESSING ITS RECOMMENDATIONS REGARDING REVENUE ENHANCEMENT OPTIONS AVAILABLE TO, AND UNDER CONSIDERATION BY, THE KENAI PENINSULA BOROUGH.

WHEREAS, The Kenai Peninsula Borough is faced with a significant budget gap due in large part to increasing population, increased demand for services, rapidly escalating fixed costs, and a declining industrial property tax base, and

WHEREAS, The Borough is attempting to close the gap by reducing expenditures and examining various revenue enhancement options, and

WHEREAS, Some of the revenue options under consideration may be more harmful to Borough residents, businesses, and cities than others, and

WHEREAS, The Homer City Council understands the need to balance the budget and provide for the quality and level of services that Borough residents desire, and

WHEREAS, The Homer City Council has been using a progressive multiple source approach to funding increasing budgets for the past few years to minimize the financial impact on City residents, and fairly spread out the costs of providing services, and

WHEREAS, The City wishes to work cooperatively with the Borough to provide for an overall tax structure that causes the least harm to local residents and the Borough economy while maintaining the quality of life and level of services all Borough residents have come to expect and enjoy.

NOW THEREFORE BE IT RESOLVED, That the Homer City Council recommends that the Borough Assembly strongly consider a multiple source approach, and consider in part the following revenue options based on a premise that the net result that will have the least impact to Borough residents, businesses, city governments, and the economy.

· Close existing loopholes and unnecessary exemptions in existing sales and property tax structures.

· Institute a seasonal sales tax

· A minimal sales tax increase that would generate no more than 50% of the needed revenue.

· Eliminate the individual property tax exemption while maintaining the exemption for seniors and disabled veterans.

· Consider a tourism tax in lieu of a bed tax

· Raise the sales tax cap from $500 to $1,000


· Levy a bed tax at a minimal rate, and allow cities the option to receive back the full amount collected within the city limits for the purpose of revenue sharing with municipalities, and dedicate a portion to the visitor industry which generates the money

· Raise the property tax

PASSED AND ADOPTED by the Homer City Council this 25th day of April, 2005.

CITY OF HOMER

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ATTEST: JAMES C. HORNADAY, MAYOR

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MARY L. CALHOUN, CMC, CITY CLERK

Fiscal Note: Revenue.