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ANCHORAGE, Alaska (KTUU) – A coalition of Anchorage business leaders led by the Anchorage Economic Development Corporation has announced the launch of Project Anchorage, an initiative that would implement a year-round 3% sales tax.

AEDC President Jenna Wright said the initiative will primarily reduce property taxes for Anchorage residents and also stimulate other economic activities.

“Two-thirds of that revenue would be used to reduce property taxes by about 20%, and the other third of the revenue would go toward new projects that make Anchorage an even better place to live, much like we did back in Project 80 when we built the Anchorage Museum, the Egan Center, the Coastal Trail and so many other gems that we still love as a city today,” Wright said.

A study commissioned by the University of Alaska’s Center for Economic Development estimates that the tax could generate $180 million annually. According to the plan, $120 million would go toward reducing property taxes and the remaining $60 million would be used for new investment projects.

The group is actively seeking ideas for projects to fund and asks interested parties to submit projects to be considered on their website.

Wright said the idea of ​​using a sales tax to finance major projects originated in Oklahoma City, Oklahoma, which in the 1990s faced similar economic problems to those Anchorage faces today. Wright said the city used sales tax revenue to invest in new sports facilities, parks and entertainment that attracted young people to stay in their community.

“As a result of these investments, Oklahoma City has attracted billions of dollars in private investment and its economy is booming,” she said.

Anchorage has never had a sales tax; an attempt to pass one in 2006 failed, and another attempt in 2016 was withdrawn before it was put to a vote.

Kathleen McArdle, president of the Anchorage Chamber of Commerce, which supports the tax, said residents may now have a different opinion.

“Anchorage residents have said in the past that they are not ready for a sales tax, but we believe now is the time when it may be more acceptable,” McArdle said.

The proposed tax would not apply to what the group calls necessary household items – such as groceries, gasoline or medical expenses – but to other purchases, including eating out.

Laile Fairbairn, co-owner of four Anchorage restaurants, said she believes the tax is necessary to make Anchorage a better place to live.

“I don’t think anyone likes a tax, but I don’t like Anchorage as I see it right now. I think we need to do something and we need to raise revenue to do it,” Fairbairn said.

Ultimately, it will be up to the Anchorage Assembly whether the question of a sales tax is put before voters. If the Assembly approves, the proposal could be on the ballot in April of next year.

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