The Mat-Su Borough Assembly postponed a vote on a seven-cent fuel tax that would help fund local transportation projects. Public sentiment at the meeting was mostly negative.
Borough Manager Mike Brown says the goal of the tax is to help provide a different way to fund road projects that requires less or no debt service.
According to him, some major Borough road projects are supplemented with State funds. But with the lack of State legislature support for recent road projects, the Borough instead must incur debt to pay for them. The funds raised through the tax could be used to help pay down existing debt or for new road projects.
“Either way, it’s promoting project development for roads and it is addressing this challenge that we’re going to have with the debt eroding into, you know, our ability to provide services over time.”
Brown says the Borough has projected a rough revenue estimate of about five million dollars per year.
“But obviously if we could get a year of data, then we’ll have a much better ability to kind of project and forecast what those revenues will look like.”
As proposed, the tax would start January 1, 2026. The Assembly already voted to sunset the tax on June 30, 2027, which will give the Borough a full year in revenue to better understand the impacts to budget and residents.
The tax is expected to add about $30 per year to Borough residents’ fuel bills. Marine, aviation, and home heating fuel would be exempted in the proposed bill. An exemption for diesel for heavy equipment is included in the amendment the Assembly passed Tuesday.
The Assembly will take up the proposed fuel tax bill again at their August 5th public meeting.
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