A resolution that aimed to bring a bed, or lodging, tax to the Kenai Peninsula Borough was tacitly kicked down the road after a lengthy discussion between the public commenters and assembly members during the last assembly meeting on June 18.
Assembly Vice President Tyson Cox and Assembly Member Brent Hibbert’s resolution sought to add a potential bed tax measure to the ballots in the fall 2024 elections. According to Cox, the justification for such a measure was two-fold. First, Cox said the tax would bring the borough an estimated $5.3 million in revenue. Second, he believes the tax would offset increased visitor-generated costs incurred by the borough.
The resolution suggests a bed tax as high as 12% for peninsula visitors.
The public challenged these assertions almost immediately when more than an hour’s worth of commenting ensued from borough residents who consistently voiced dissent of the proposed tax.
Kenai resident Duane Bannock provided itemized criticisms of the resolution, pointing out several contradictions between the borough code and the resolution on the table, including the assertion that visitors to the borough are not covering the costs associated with their presence on the peninsula. “I challenge [support of] the language [that] visitors create a large demand on borough roads, senior services, hospital, and disaster services. I encourage you to especially consider that sales tax collected on food, fuel, lodging, and other items likely exceeds the costs directly attributed to the visitors themselves.”
Assemblymember Peter Ribbens shared questions about the resolution that came up in committee. “One of the points we discussed quite a bit is that it would be nice if we had some additional data on what the actual costs to the borough were from tourists. The second point was [the] justification of the up to 12% tax. Another one was incorporating hospitality business ideas into the ballot initiative. Another one was [regarding] the need for what the immediacy was for the resolution to be on the ballot in 2024.”
The resolution was ultimately tabled by a 6-3 vote until the July 9 assembly meeting, when it will be revisited and potentially moved further down the road.
