Mat-Su Assembly indefinitely postpones ballot measure on sales tax amid opposition

PALMER — A proposal for a public vote on a 2 percent sales tax to pay for schools didn't make it out of the of the Matanuska-Susitna Borough Assembly Tuesday night and appears dead — for now.

Instead of voting on whether voters should be allowed to decide the tax, the Assembly indefinitely postponed the decision during a crowded meeting in which public opposition appeared to prevail.

The Assembly was deciding whether to put the tax on the ballot, either in October or a special election in January. The vote Tuesday was 6-1, with Assembly member Jim Sykes the lone "no" vote because he wanted the decision postponed to a specific date.

The Assembly did establish a committee to work with business owners and cities as well as school advocates, with a report due in early November.

The vote Tuesday essentially killed the chance the tax proposal will make the October ballot. Technically, the Assembly has till Friday to add an item to the election in October, but no additional meetings are scheduled on the sales tax.

The Matanuska-Susitna Borough School District had wanted a special election in January, and that's still possible. If the Assembly opts for the Jan. 23 election, it would have to decide no later than Nov. 8, according to Borough Clerk Lonnie McKechnie.

The idea of a January election, however, drew fire Tuesday night from anti-tax advocates who said winter weather would keep turnout low — except for tax supporters urged to the polls by the district.

The district sought the tax, saying per-student funding is actually $700 lower this year than last amid lagging local and state funding. Mat-Su is the only school district in Alaska continuing to grow year after year, officials say.

But at this point, given the tone of Tuesday night's meeting, the conversation about how to fund schools is "starting over again," said district spokesperson Jillian Morrissey.

The committee that Borough Manager John Moosey was already starting to assemble on Wednesday is now charged with finding potential revenue sources for education, Morrissey said.

"That is going to be their job," she said. "The one that was brought forward is something they didn't like. That's fine, but what's next? What is palatable and what is something people can support and get behind?"

Members of the public filled the Assembly chambers Tuesday night for a tax debate that stretched until about 10 p.m. The majority of those testifying opposed the tax, with some urging the Assembly to start over and craft a better proposal and others simply telling them no.

Several people advocated cutting school spending and chastised the borough for failed projects like the Susitna ferry or stalled railroad extension to the Point MacKenzie port.

"I watch old people's houses drift down the river. No response," said Mike Pearson, who lives on erosion-threatened property on the Matanuska River near Sutton. "But all of a sudden I get a call: the children, the children, the teachers, they need money. Why don't you take a hard look at the school district administration — that's where the money's going. The children aren't getting it. Neither are the teachers."

Jim Turner, a former Assembly member who owns a gas station and store near Hatcher Pass, called the tax "disastrous to local Valley businesses and employees."

Todd Smoldon, a Willow resident and 20-year teacher who makes a 150-mile commute to Anchorage, said the tax would hit during a statewide recession and with Permanent Fund dividend checks held at $1,100 per Alaskan.

"This is a regressive tax and it will hurt the poor the hardest, and the elderly, and those that can least afford a sales tax," Smoldon said.

Representatives of the borough's three cities also spoke against the tax, saying it could combine with city sales taxes to push retail customers to Anchorage for tax-free shopping.

Many critics, including city officials, noted the borough lacks the authority to earmark tax revenue for any specific use including education. This current Assembly may promise to spend the money on schools, but future Assembly members might not, Palmer City Manager Nathan Wallace said.

"The intent of the law may be lost over time," Wallace told the Assembly.

Several educators and parents testified in support of putting the tax on the ballot so voters could make an informed decision.

Tim Walters, president of the Mat-Su teachers union, said he was representing himself and urged support of the tax as a way to offset the Valley's surging class sizes.

Some high school classes this year are expected to top 40 students, Walters said. Kindergartens could have 30.

"Thirty kindergartners using scissors," he said. "Think about that."

John Robertson told the Assembly he lives in Sutton and pays the highest property tax rate in the borough.

Robertson said he was intrigued by the financial diversification that could come from sales taxes and wanted to see a "robust debate" with facts from both sides given the demands of funding education with the state in decline.

"Maybe we'd get revenue from people from Anchorage, or tourists," he said. "I don't know how I'd vote. But I would like a chance to vote."

Zaz Hollander

Longtime ADN reporter Zaz Hollander is based in the Mat-Su and is currently focused on coverage of the coronavirus in Alaska. She also covers the Mat-Su region, aviation and general assignments. Contact her at