The borough’s code review committee has started the task of revamping two portions of the borough code.
The first has to do with sales tax, specifically a sales tax cap designed to shield large-ticket purchases from the tax. Until 2004, borough code had set a maximum of $84 tax for any single purchase in the borough, officials said.
A set of standard and unnoticed revisions took place in 2004 which essentially invalidated it, borough manger Jeff Jabusch told the committee. From 2004 until August 2013, the borough had operated as if the code allowed the tax cap. A standard review of local codes conducted by Petro Marine Services – the company that purchased Wrangell Oil – revealed the discrepancy, Jabusch said.
While the issue originally arose out of fuel sale purchases, the cap was designed to apply to all big ticket items, Jabusch said.
“If you went to, say, the hardware store and bought $1,000 worth of lumber and $500 worth of windows and $500 worth of some saws and tools and stuff like that and you had your invoice and you’re ready to pay, you’d pay the tax on the whole $2,000,” he said.
The realization makes Wrangell temporarily unique among local communities, most of which have sales tax caps in place, Jabusch said. Sitka has recently raised their sales tax cap to $1,500, and Petersburg is thinking about following suit, Jabusch added.
The committee will also consider raising their sales tax cap to match Sitka and Petersburg.
The issue lacks urgency in part because of the weather. Tourism and fishing typically lag through the winter, meaning businesses aren’t feeling the pinch they would in warmer, travel-intensive months.
Officials will make the changes and consult with the borough attorney. The code will come back to the code review committee, then move through two hearings in the assembly before taking effect.
A second issue concerns allowing borough assembly members to attend meetings via teleconference. Potential changes would add a new chapter to borough code, which is the typical source of attendance regulations in Alaska, said borough clerk Kim Lane.
In discussion, committee members said they favored allowing members to attend, but were wary of allowing voting, attendance, or participation in executive sessions to be counted or conducted remotely.
“That’s truth,” said committee member Stough. “I could be up the river and phone in. I don’t have a problem with some of that, but we need some kind of new guidance. We’re in the electronic age here, and we need to figure out does it count toward a quorum or not.”
Mayor David Jack agreed.
“I can see, maybe not in the very far future, people wanting to participate by Skype,” he said. “We should address that and either have it or not.”
Executive sessions could prove particularly problematic. Public bodies invoke the closed-door sessions typically to deal with employee privacy or potential lawsuits. Assembly members couldn't verify that privacy over the phone, committee members said.
“So calling in to our regular or special meeting, we would allow that,” Lane said. “To count towards a quorum would be no. To count toward executive sessions would be a no. Can a member call in vote, would that be a no?”
Committee members said no.
“I think you need to be here to vote,” said Maxi Weiderspohn.
Since the process of reviewing all instances of the code where voting or attendance play a role will take time, the committee will put the item forward as a policy until a review is conducted, pending approval by the assembly.
The next borough assembly meeting is set for Feb. 11.
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