Anchorage’s first year of alcohol sales tax raises nearly $14M

ANCHORAGE, Alaska (KTUU) - It’s been just over a year since the Municipality of Anchorage began collecting a 5% tax on retail alcohol sales. Supporters who predicted the tax would raise between $11 million and $15 million a year were correct.

According to Director of the Anchorage Office of Management and Budget Cheryl Frasca, the tax raised $13,980,428 dollars in the 11 months it was collected in 2021.

The city has not released a breakdown of exactly where the money was spent, but the voter approved measure has funds earmarked for three broad categories:

• Combating child abuse, sexual assault, and domestic violence.
• Targeting homelessness, mental health, and substance misuse.
• Public safety and criminal justice.

Tiffany Hall, director of Recover Alaska, helped to push for the alcohol tax. Hall said she’d like to see more details on how it was spent, but believes the money is being put to good use.

“I know that the increase in the price of alcohol saves people’s lives,” Hall said. “I know that the tax itself is a public health win, regardless of where the funding goes.”

Anchorage Assembly member Felix Rivera said he is also waiting on a detailed list from the city on specific programs that were funded with 2021 alcohol tax revenues.

“Really what we want to know is how effective the programs were,” he said. “Did they achieve the goals that the voters supported?”

Frasca said the city is concentrating on where 2022 funds will be spent, which has been provided to the assembly. She added that assembly members had not requested the information from 2021.

Anchorage municipal charter states that the mayor shall submit a report to the assembly on the tax revenues from the alcohol sales tax at least 120 days before the end of the fiscal year, “and at such other times as the assembly directs.”

Rivera said, in general, he believes the funds are going where they’re intended.

“The recent announcement of the Domestic Violence Sexual Assault Unit in the Department of Law and in (the Anchorage Police Department), that was funded through the alcohol tax dollars,” he said.

Not all the money that was raised in 2021 has been spent. According to Fresca, $7.7 million has been set aside in a special fund that can only be used for the purposes that voters have approved.

Anchorage Mayor Dave Bronson is also proposing $1.3 million of the money be used to help fund a new homeless shelter and navigation center in East Anchorage. That allocation is part of an $8.2 million proposal for the shelter and navigation center construction. A resolution on that funding was set to be introduced at Tuesday’s assembly meeting.

Editor’s note: This article has been updated with additional information.

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