Kodiak ordinance would make tax-exempt landowners report private users to assessor

An ordinance requested by Kodiak Island Borough Assembly members Jeremiah Gardner and Scott Smiley would require federal, state and other tax-exempt landowners to report private users of their property to the assessor each year. The Assembly takes up the measure for introduction at its 6:30 pm meeting Thursday, Nov. 19. A vote to introduce would send it to a public hearing.

Borough code already taxes a private user's possessory interest in public property: the user's own stake in property it leases, borrows or otherwise uses. That tax is a lien only on the private interest, not on the public property. The ordinance in the Nov. 19 meeting packet would add a reporting duty. By Sept. 1 each year, exempt owners would have to name every entity or private leaseholder using their land, give contact information and attach a copy of the lease or agreement. It would take effect on adoption.

Gardner and Smiley filed their request Sept. 10. It would have put the filing duty on "the private leaseholder." The draft instead places it on the exempt owners and adds the requirement for a copy of the lease. The Assembly first reviewed the draft at an Oct. 29 work session, where Gardner said the conversation started because of Alaska Aerospace but has since broadened.

At a Nov. 12 work session, Gardner said he and Assessor Seema Garoutte wrote the ordinance with help from Clerk Nova Javier so the borough can tax property in non-taxable areas. The example given was an Anchorage contractor bringing $1 million in tools to build a house for the Coast Guard base. A speaker in the same presentation said the Coast Guard, Alaska Aerospace or any nonprofit had been expected to report such users, but the code "never said that they had to."

"So it levels the playing field with locals and non-locals paying into the pot," Gardner said. Local businesses already file personal property forms every year, he said, while companies from elsewhere doing business in Kodiak are not taxed on that property.

"I'm interested in the multimillion-dollar crane that's out there for the dock work, and there's been multiple cranes there," said Assembly member Scott Arndt. Assembly member Alexander Sweeney said the reports would create a paper trail useful in insurance claims. No one spoke against the measure.

Garoutte's staff report recommends introducing the ordinance and leaves its fiscal impact section blank. Borough records do not show the revenue at stake, what happens if an owner fails to file, or whether federal and state owners must comply.

Staff ask for a public hearing at the next regular meeting, which the borough calendar lists for Dec. 3.