HomeMy WebLinkAboutORDINANCE 1970-2002Suggested by: Administration
CITY OF KENAI
ORDINANCE N0. 1970-2002
AN ORDINANCE OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AMENDING
KMC 7.10.050, WHICH INCORPORATED BY REFERENCE THE BOROUGH SALES
TAX CODE BY ADDING A SECTION PROVIDING THAT THERE SHALL BE NO
EXEMPTION FROM CITY SALES TAX FOR NONPREPARED FOOD.
WHEREAS, KMC 7.10.050 incorporates by reference the Borough sales tax code; and,
WHEREAS, if the proposed Borough ballot proposition exempting nonprepared food
passes on October 1, 2002, it will be effective the week of October 8, 2002; and,
WHEREAS, unless KMC 7.10.050 is amended, the exemption for nonprepared food
would take effect on the same date for the City sales tax; and,
WHEREAS, the City of Kenai would lose nearly one million dollars in sales tax revenue
annually due to an exemption on nonprepared food; and,
WHEREAS, as a home rule municipality, the city of Kenai has the right under title 29
to establish it own sales tax exemptions.
NOW, THEREFORE, BE IT ORDAINED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA that KMC 7.10.050 is amended to read as follows:
7.10.050 Borough sales tax adopted by reference.
~ Except as provided in (b) below, incorporated by reference in this
Code as though each code provision was set forth verbatim herein
are statutes, consisting of ordinances and/or code provisions of the
Kenai Peninsula Borough or such portions thereof, which provide for
the sales taxes, including but not limited to their levy, collection,
and administration.
(b) There shall be no sales tax exemption on nonprepared food. The
above sentence does not affect the sales tax exemption granted
under AS 29.45.700(d) exempting food purchased under the Food
Stamp Act or Special Supplemental Food Program for Women,
Infants and Children.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALAS hi fo ay of
September, 2002. ~.~ ~ / / ~~,~,,
JOHN . WILLIAMS, MAYOR
A EST:
.
Carol L. Freas, City Clerk
Introduced: August 21, 2002
Adopted: September 4, 2002
Effective: October 4, 2002
CITY OF KENAI
~ 210 FIDALGO AVE., SUITE 200 KENAI, ALASKA 99611-7794
TELEPHONE 907-283-7535
_ FAX 907-283-3014
IIIIII
1992
MEMORANDUM
T0: Mayor Williams and Council Members
FROM: ~ ~ Cary R. Graves, City Attorney
DATE: August 29, 2002
RE: Sales Tax Exemption Ordinance
Ordinance number 1970-2002 changes our sales tax exemptions to exclude an exemption on
nonprepared foods.
As you know, on October 1, 2002 the Borough voters will decide whether to exempt
nonprepared food from Borough sales tax. According to the Borough Attorney's office, if
passed, the ordinance would ordinarily be effective on October 8, 2002, unless there is a recount
or election challenge. Because of the difficulty in changing the collection of sales tax from the
Borough in a one-week period, the Borough is implementing the exemption on January 1, 2003.
Our sales tax code currently incorporates by reference all the Borough sales tax code. That
means if the proposition passes, as it stands now the City would have no sales tax on
nonprepared food as of January 1, 2003. The Borough Finance Department has estimated
elimination of sales tax on nonprepared food would cost the city about one million dollars per
year.
Under our Charter, except for emergency ordinances or appropriations, ordinances are effective
one month after passage. That means that an ordinance introduced for the meeting of August 21
and passed on the next meeting of September 4 would be effective October 4. The ordinance
essentially keeps the current city exemptions in place no matter how the election comes out. If
the ballot proposition fails, nothing would change. If it passes, current exemptions would
continue. We would not adopt the Borough's nonprepared food exemption. As a home rule
municipality, Kenai may determine its own sales tax exemptions.
If the proposition passes, Council may want to examine whether to pass a similar exemption to
reflect what the voters in Kenai want. This ordinance will not preclude that-it will merely give
the Council time to decide on its own whether to adopt the exemption rather than having it done
automatically.
CRG/sp