Reduced Alcohol Sales Tax Means Bethel's Community Action Grants Need Alternate Funding

Feb 19, 2020

Bethel City Council will have to decide how to fund community action grants after losing funding from alcohol sales taxes.
Credit City of Bethel

One of the effects of enacting local option is that Bethel loses much of its alcohol sales tax, which is $500,000 that the city estimated it would receive last year. It still receives some alcohol sales tax from restaurant beer and wine sales. The decreased revenue means funding for Bethel’s Community Action Grant program is almost gone as well. 

Back in 2017, the city council decided that 20 percent of alcohol sales taxes would fund community action grants, described on the city website as “health, public safety, and social services that offset the effects of alcohol in the community.” For the past fiscal year, that amounted to $120,000.

In the past, the grants have been awarded to services like Bethel Winter House, reflective tape for peoples’ clothes, and bus passes for Elders. With Bethel’s local option decision last October, City Clerk Lori Strickler says that there is not enough funding for the program next fiscal year.

Several council members have asked if the grants could be funded through a marijuana sales tax. Strickler says that they could. Another option is the alcohol use tax, which is collected on alcohol orders from Anchorage liquor stores. 

Strickler reports that $46,000 still remains for community action grants this fiscal year, which ends in July. Bethel City Council will have to decide what happens after that.

Correction: An earlier version of this story stated that entering local option meant that Bethel receives no alcohol sales tax. That is not true. There is still alcohol sales tax collected on beer and wine sales in restaurants.