The Nome Common Council is on track to pass a budget for fiscal year 2027, but all present council members agreed on Monday that the final product still needs a bit of work before its final passage in June.

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Pull tabs
Council meetings rarely see robust participation by the public. Last Monday, though, the audience gallery was packed with representatives from nonprofit organizations who showed up in force to lobby for an ordinance repealing the current method of taxing pull tab sales.
Council member Mark Johnson requested an amendment to the agenda to include discussion of the ordinance proposal. Since it was not included in the council packet, City Manager Lee Smith read the entire bill into the record. The gist of it: charitable gaming provides essential financial support to nonprofit organizations. But the pull tab sales are taxed by the city on gross sales, before prizes are paid out and operators are paid, making for very small profit margin. This was exacerbated when the city’s sales tax rose to six percent effectively increasing the tax burden between 20 to 30 percent on charitable gaming. The nonprofits asked the council to adopt an ordinance that would tax the pull-tab based on the “ideal net” of each pull-tab series. What is ideal net? Each pull-tab series is manufactured with a predetermined and state-approved prize payout schedule, and establishing a fixed relationship between gross receipts, prize payouts and net proceeds is referred to as ‘ideal net.”
Council member Adam Lust wanted to know the financial impact on the city’s coffers.
Mayor Ken Hughes answered: The city takes in about $300,000 in pull tabs revenue and if the tax structure were to change, this revenue would drop to $65,000. Hughes also said that changes are on the horizon with e-tabs, electronic pull-tabs, and state legislation currently discussed may upset the entire Nome charitable gaming scene.
Council member Henderson requested a work session on the issue, to gain a better understanding of the matter, before voting on it.