MEMORANDUM

TO: Pete Sprague, Assembly President

Members of the Kenai Peninsula Borough Assembly

THRU: Dale Bagley, Mayor

THRU: Jeffrey Sinz, Finance Director

FROM: Troy Tankersley, Sales Tax Supervisor

DATE: January 23, 2003

SUBJECT: Resolution 2003-015, Adding Business Personal Property to Guide Compliance Certificate

On May 7, 1991, the borough assembly adopted Resolution 91-52 requesting that the State of Alaska, Division of Parks and Outdoor Recreation, require that applicants for a Kenai River Guide Permit be in compliance with the borough sales tax code prior to issuance of such permit. Since the passage of that resolution, the State of Alaska has complied with the borough's request. This requirement acts as a strong incentive for Kenai River guides to bring their sales tax accounts current each spring when they must apply for their annual guide permit. The State of Alaska's cooperation in this matter has greatly assisted the borough in its sales tax code enforcement effort.

The attached resolution, if approved, would request the State of Alaska to also require applicants for Kenai River Guide Permits to be in compliance with the borough's personal property tax code. Virtually all Kenai River guides use boats in the delivery of their guiding service. These boats are considered taxable personal property under the borough code. Boat owners are required to annually file a personal property tax return and pay taxes. Since the boats are directly involved in the delivery of the permitted guiding service, the borough finance department believes it is appropriate to require that businesses and individuals providing the permitted guiding service be current with their personal property taxes, as well as their sales tax payments. It is anticipated that adoption of this resolution and acceptance by the State of Alaska, Division of Parks and Outdoor Recreation, will help reduce personal property tax delinquencies.