As a longtime resident of Homer and a real estate broker deeply connected to the Kenai Peninsula, I’ve witnessed first hand the impact our current property tax system has on our community. It’s time for meaningful reform that ensures fairness, predictability and equity for all property owners. That’s why I am proposing “The Fair Act – Property Tax Reform,” a resolution designed to address the systemic issues inherent in our property taxation system and provide relief to those most burdened.
The Kenai Peninsula’s current property tax system, based on assessed market values, creates significant financial stress for many property owners. Tax assessments often reflect unrealized gains due to market fluctuations, forcing residents to shoulder taxes on paper increases that have not translated into real dollars. This approach disproportionately impacts long-term property owners, retirees on fixed incomes, and working families who are taxed on hypothetical wealth. It’s an unsustainable model that erodes financial stability and places undue pressure on the very people who have made our community what it is.
We don’t have to look far for solutions. California’s Proposition 13 has shown the benefits of limiting property tax assessments and increases. By providing stability and predictability, Proposition 13 has allowed homeowners to plan for the future without the looming fear of skyrocketing property taxes. Adopting a similar approach here could provide the same stability for Kenai Peninsula residents while addressing the unique challenges our community faces.
The Fair Act proposes a straightforward, common-sense framework for reform:
1. Establishing a Base Year Value System: Property tax assessments would be based on the fair market value as of 2018, creating a stable and predictable baseline. For newly purchased properties, assessments would align with the purchase price, ensuring a fair entry point for new owners.
2. Maintaining Consistent Tax Rates: A fixed tax rate, capped at a reasonable percentage of assessed value, would provide residents and businesses with predictability in their financial planning.
3. Fairness in Property Transfers: When properties change hands, assessments would reset to the new purchase price, establishing a fresh base year for new owners. Transfers within families, such as from parents to children or grandparents to grandchildren, would qualify for reassessment exclusions, encouraging generational property retention.
4. Protections for Vulnerable Populations: Senior citizens and residents with disabilities would be exempt from property taxes on their primary residences, safeguarding affordability and stability for our most vulnerable neighbors.
5. Eliminating Taxes on Unrealized Gains: Speculative market value increases would no longer inflate property tax bills. Taxes would reflect real, tangible value rather than hypothetical projections.
6. Relief During Market Downturns: If a property’s market value falls below its assessed value, owners could request reassessment and a corresponding tax reduction. This ensures fairness during economic downturns.
The Fair Act isn’t just about lowering taxes; it’s about creating a system that is equitable, transparent and reflective of our shared values. It’s about ensuring that property ownership remains accessible and sustainable for families, retirees, and local businesses alike.
Critics may argue that these changes could reduce borough revenue, but I believe a fairer system will ultimately strengthen our community. By reducing the financial strain on residents, we empower them to invest more in their homes, businesses, and local economy. A thriving, stable community benefits everyone, including local government.
This resolution is more than a policy proposal; it’s a call to action. I urge my fellow Kenai Peninsula residents to support The Fair Act and advocate for its inclusion on the KPB Assembly agenda. Together, we can ensure that property taxes are fair, predictable, and not punitive, fostering a stable future for all of us who call this incredible place home.
Let’s work together to protect the rights of property owners and create a tax system that truly reflects the values of our community. It’s time to move away from an outdated and burdensome model toward one that prioritizes equity, fairness, and sustainability.
“NO more taxation on unrealized gains.”
Chris Story is the owner and broker of Story Real Estate and the host of On Top of the World radio and podcast. He is also the author of “The Backyard Millionaire: How to Create Wealth Where You Are with What You’ve Got.”
