Amid the chaos and deluge of negative campaign ads in the run-up to the Nov. 5 election, the municipal sales tax proposal known as Project Anchorage has faded into the background for most residents. That’s a pity because the proposal is an interesting one: It would institute a 3% sales tax, with two-thirds of the revenue collected used to offset property taxes. The other percentage would go toward funding civic projects to enhance Anchorage and make it more engaging for visitors and residents alike.
There’s plenty to debate about the Project Anchorage proposal: Is the property tax offset necessary, or would it make more sense to just collect a 1% sales tax and forgo the added complication? Does a sales tax make the most sense as a revenue-generating measure? What kinds of projects would it make the most sense to fund?
One aspect of the situation Project Anchorage seeks to address, however, should be indisputable: It is the result of a clear-eyed look at Alaska’s fiscal straits, with the proposal’s backers realizing that we can no longer count on the federal and state governments for the kinds of contributions to Anchorage’s infrastructure that typified previous generations. Whether or not it comes as a sales tax, if we’re going to embark on a course toward a new-look Anchorage, much of that spending will have to come from our own pockets.
The idea of having to self-finance major infrastructure at the municipal level likely makes many longtime Alaskans deeply uncomfortable. After all, ever since the oil boom at Prudhoe Bay, there has been substantial oil money to help pay for such projects. But those days have dwindled — oil revenue can no longer sustain the majority of the state budget, to say nothing of big new capital projects. And that’s difficult for Alaskans to internalize because the declines in production and associated revenue have been so gradual and longstanding that our situation is akin to the apocryphal tale of the frog in a slowly heated pot of water: With many of us focused on other priorities, we’ve suddenly found ourselves approaching a boil.
We’re an adaptable species, but when it comes to taking action, we tend to take our cues from big, landmark events that make us rise to meet the moment. Alaska’s history for the past century can be divided into several eras with fairly clear precipitating events: territorial days, World War II, statehood, and the oil boom at Prudhoe Bay. But we’re transitioning into a new era for Alaska now — call it “post-oil,” even though oil is still an important part of the economy. And without an obvious event or stark crisis to herald its arrival, too many Alaskans — including many who seek to lead our state — are in denial about the fiscal issues we face. If we wish to shed our reputation for shortsighted financial planning, we can’t afford to risk that kind of backward-looking leadership.
Our fiscal situation underlies most of the bigger issues Anchorage and Alaska face: homelessness, mental and behavioral health care shortfalls, sustainable budgeting, even snow removal and preparation for extreme weather events. We can disagree and debate the best solutions for addressing our fiscal situation — but we need to be realistic about our options and means of generating revenue to implement them.
And that’s something we should keep in mind as we head to the polls in November: Which candidates will work to solve our structural financial problems rather than dig their heels in and grandstand for their most extreme supporters? Which of our leaders will acknowledge the reality that in the long term, no one is coming to save us but ourselves — not the oil price fairy, not a mythical natural gas pipeline, not the second coming of “Uncle Ted.”
We need lawmakers in office who face this problem and propose concrete, sensible solutions. We’ve been fortunate to have a cushion of prudently invested assets to draw from as Legislatures and governors have spun their wheels on this issue for a full decade, but the time those assets bought us is just about up. We need leaders, regardless of party, who can work with anyone and move all-out toward a solution, even if it wasn’t their idea in the first place. And this November is our best opportunity to make sure those kinds of leaders represent us in the Legislature come January.