Alaska Property Tax Exemption Act, Ballot Measure 1 (August 2012)
|Ballot Measure 1|
|State code:||Section 1. AS 29.45.050(a)|
|Status:||Too close to call|
The Alaska Property Tax Exemption Act, or Ballot Measure 1, was on the August 28, 2012 primary election ballot as an indirect initiated state statute in the state of Alaska where it was approved. The measure would allow municipalities to overlook, at most, $50,000 of the value of residential properties when imposing taxes. According to reports, the homeowners’ exemption currently has a ceiling of $20,000.
On December 20, 2010 the state initiative committee was told by the Lieutenant Governor Mead Treadwell that the initiative petition was properly filed, which was previously ruled improperly filed. Since the legislature did not enact an act that was similar to the proposed law before the 2012 primary election the measure was placed on the 2012 ballot.
The following are official election results:
|Ballot Measure 1|
438 out of 438 precincts reporting via the Alaska Elections Division
Election results last updated 18 May, 2013 09:47 UTC. Click here for Alaskan Standard Time conversions.
Text of measure
The language of the measure read as follows:
|“|| Bill Increasing the Maximum Residential Property Tax Exemption
This bill would allow a city or borough to raise the property tax exemption on a residence from $20,000 to at most $50,000. This kind of tax exemption must be put to a vote and approved at a local election. The bill also allows a city or borough to pass a law to adjust this exemption to reflect a raise in the cost of living.
Should this initiative become law?
The legislative summary of the measure read as follows:
- This Act is about municipal property taxes. Under current law, part of the value of a home may be exempted from those taxes. The Act does two things. It raises the amount of value that may be exempt from $20,000 to $50,000 per home. It also allows an exemption to be increased if the cost of living goes up.
The following is a portion of the fiscal note prepared by the state Department of Commerce, Community and Economic Development. To read the entire document, click here:
- This ballot initiative will allow municipalities to increase the optional residential property exemption, as authorized in AS 29.45.050(a), from the current $20,000 up to $50,000. There is no cost to the state for administering the exemption. However, there could be a loss of revenue to the state if municipalities with significant oil and gas property within their boundaries enact the exemption to the maximum amount. This is a result of the shifting of the tax burden from residential property to nonresidential property.
- Fairbanks North Star Borough Presiding Officer for the Assembly Nadine Winters, Borough Mayor Jim Whitaker and Eileen Cummings were sponsors of the amendment. Cummings served as the project manager. According to Winters: “This initiative is necessary to provide tax relief to local residents.”
- Assemblywoman Nadine Winters stated, "I was really concerned about residential taxpayers and the pressure the high cost of energy has put on them. So this is a way to give them a break, a small break, but a break.”
The following are portions of the statement of support that were found in the state primary election ballot measure pamphlet. The statement was prepared by Nadine Winters and Jim Whitaker:
- "If the initiative passes, municipalities would be allowed to offer a residential property tax exemption up to $50,000. A municipality could exclude or exempt or partially exempt residential property from taxation by ordinance ratified by the voters at an election."
- "Local option, through the ordinance and local election process, would determine how much the exemption would be and whether or not to adjust the exemption each year for inflation. The increased exemption will allow for homeowner tax relief. It will also provide municipalities a tool when they consider diversifying their revenue stream."
- Anchorage Mayor Dan Sullivan stated his opposition to the measure. According to Sullivan, "What people just don't seem to understand is that it sounds good on the surface, but it doesn't apply to renters, the lowest socio-economic group."
- City assessor Marty McGee was an opponent of the proposal, and prepared the Statement of Opposition in the official state ballot measure pamphlet.
- Mike Navarre, mayor of the Kenai Peninsula Borough, said, "If the ballot measure passes, then we could provide an additional exemption on property taxes for residents and that seems like a good idea, but in every case, what you end up with is a loss of revenue," said Navarre. "So, do you provide the exemption and then increase the mill rate in order to make up for the loss? If you do, you shift it to higher value properties or business properties that don't allow for an exemption."
The following are portions of the statement of opposition that were found in the state primary election ballot measure pamphlet. The statement was prepared by Marty McGee, Assessor/Municipality of Anchorage:
- "A change in the exemption from the current $20,000 to the proposed $50,000 limit would create a reduction in the tax base and an increase in the tax rate. If approved, about $22 million in taxes will be shifted to other taxpayers. It comes as a surprise to most taxpayers that increasing the residential tax credit results in an increase in taxes for lower value homes. For the 2012 tax year, there are 47,000 property owners receiving the current $20,000 residential exemption. If the exemption is increased to $50,000, 32% of those currently enrolled will see an average $30 increase to their tax bill. Property owners with an assessed value over $237,000 will receive an average reduction in taxes of $190. Increasing exemptions from property tax does not reduce the demand for services from government or the cost of the services provided; it just lowers the tax base. If the cost of government stays the same, and the tax base is reduced, then the tax rate must be increased to pay the bills."
- "The impact on homeowners is not the whole story. Since the residential exemption does not apply to business personal property or commercial real estate, those property owners will see an increase in taxes. Business personal property and commercial real estate account for 37% of the tax base. Non-residential property owners will see an increase in their tax bills if the exemption is increased. The $22 million tax shift will go to the 38% of homes not in the program, lower value homeowners, and the owners of business related property in the community."
- The Dailey News-Miner endorsed the passage of the measure, with the publication's editorial board stating, "There is nothing in the measure that requires an increase in the exemption for homeowners. That would come at a later date through the public process of approving an ordinance and putting it up for a vote, a system with appropriate checks and balances. Voting yes on Ballot Measure No. 1 would give each community an important local option in setting tax policy. It deserves your support."
- The Homer News wrote, "Sounds like a good idea. Who wouldn't like to see their property tax bill lowered? Unfortunately, exemptions create more problems than they solve. This measure would shift the tax burden from homeowners to others. A better solution to lower everyone's tax bill is offered by Marty McGee, the assessor for the Municipality of Anchorage, who wrote the opposition statement in the voter pamphlet: work with elected officials to limit the growth of the municipal budget or seek alternative revenue sources or, we would add, some combination of the two."
Path to the ballot
The application was certified by the Lieutenant Governor of Alaska and petition booklets were issued to the initiative committee on June 25, 2009. The one year filing deadline for the proposed measure petition was June 25, 2010. Over 32,000 signatures from registered voters were needed to for the act to get on the 2010 ballot. The signature deadline to place the measure on the November 2, 2010 ballot was on January 19, 2010.
However, the initiative effort fell short, as the petition was not turned in due to insufficient signatures. During the week of June 4, 2010, the Alaska Division of Elections stated that the measure was 1,214 short of the 32,734 signatures needed to place the measure on the 2010 ballot.
The early January 19, 2010 deadline in Alaska was a function of the fact that Alaskan initiatives are indirect initiated state statutes, which means that they must be filed in time for the state legislature to weigh in on them. The group then had until the one year filing deadline to submit signatures in order for it to be placed on a 2012 election ballot, which it did. Therefore, the measure was placed on the ballot.
The following is a timeline of events surrounding the measure:
|Application Certified||Jun. 25, 2009||The application was certified by the Lieutenant Governor of Alaska.|
|Signature Deadline||Jan.19, 2010||Signature deadline for 2010 ballot, however, efforts fell short.|
|Insufficient Signatures||Jun. 4, 2010||Division of Elections stated that effort was 1,214 short of signatures needed for 2012 ballot.|
|Filing deadline||Jun. 25, 2010||One year filing deadline for 2012 ballot, since 2010 deadline was missed.|
|Certification||Dec. 10, 2010||Petition signatures deemed properly filed.|
|Session ends||Apr. 17, 2011||Legislative session ends without similar proposal, keeping measure on ballot.|
- Alaska Division of Elections
- Alaska Dispatch, "Ballot Measure 1: Alaska homeowner tax relief or Robin Hood tax hike?", August 27, 2012
- ↑ 1.0 1.1 Fairbanks Daily News-Miner, “Alaska homeowner tax break measure delayed”, January 16, 2010
- ↑ 2.0 2.1 Alaska Division of Elections, "Initiative Petition List", Retrieved January 4, 2011
- ↑ Alaska Elections, "Ballot Measure 1", Retrieved June 26, 2012
- ↑ Alaska Elections, "Ballot measure pamphlet, August 23, 2012
- ↑ News Miner, "Ballot Measure 1 looks at property tax exemptions", August 19, 2012
- ↑ Homer News, "Ballot measure No. 1: Opponents say measure will shift tax burden", August 22, 2012
- ↑ News-Miner, "Local control: Ballot Measure No. 1 offers a larger tax exemption", August 10, 2012
- ↑ Homer News, "Say 'No' to Measure 1; 'Yes' to Measure 2", August 22, 2012
- ↑ News Miner, "Ballot measure to raise homestead exemption misses mark", June 5, 2010
- ↑ Alaska Division of Elections, "Alaska Elections Petition Status
- ↑ Fairbanks North Star Borough, "Residential Property Tax Exemption Initiative", July 8, 2009
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