MEMORANDUM

TO: Ron Long, Assembly President

Members, Kenai Peninsula Borough Assembly

FROM: Pete Sprague, Assembly Member

DATE: November 23, 2005

SUBJECT: Resolution 2005-108, Establishing a methodology for apportioning the personal property tax on vessels over 100 feet in length

Ordinance 2005-44 was introduced on November 1, 2005, and is scheduled to be heard December 6, 2005. That ordinance, if enacted, would replace the flat tax with an ad valorem tax on certain watercraft greater than 100 feet in length and operating in the borough. It would only apply to vessels documented in the United States. That ordinance provides that the assessor shall establish formulas for calculating the proportion of the total market value that could be allocated to the borough based upon situs of the vessel in the borough and that the assessment formula be approved by the borough assembly.

This resolution would authorize the assessor to value such vessels by multiplying the full and true value of the vessel by the percentage of the year the vessel is within the taxing jurisdiction of the Kenai Peninsula Borough.

Your support of this resolution would be appreciated.