Legislature(2017 - 2018)

2017-01-18 House Journal

Full Journal pdf

2017-01-18                     House Journal                      Page 0048
HB 60                                                                                                                         
HOUSE BILL NO. 60 by the House Rules Committee by request of                                                                    
the Governor, entitled:                                                                                                         
     "An Act relating to the motor fuel tax; relating to the disposition                                                        
     of revenue from the motor fuel tax; relating to a transportation                                                           
     maintenance fund; and providing for an effective date."                                                                    
was read the first time and referred to the Transportation and Finance                                                          
The following fiscal note(s) apply:                                                                                             
1.  Zero, Dept. of Transportation & Public Facilities                                                                           
2.  Fiscal, Dept. of Revenue                                                                                                    
The Governor's transmittal letter dated January 17 follows:                                                                     
"Dear Speaker Edgmon:                                                                                                           
Under the authority of Article III, Section 18 of the Alaska                                                                    
Constitution, I am transmitting a bill relating to the taxation of motor                                                        
The bill would raise the tax rates on the categories of motor fuel                                                              
currently taxed under AS 43.40.010 (motor fuel tax) by increasing the                                                           
currently outdated tax rates on motor fuels, including all motor fuel                                                           
sold or transferred within the state, aviation gasoline, aviation fuel                                                          
other than gasoline and motor fuel used in and on watercraft. The tax                                                           
increase would be phased in, with a first increase effective July 1,                                                            
2017, and the second increase effective July 1, 2018. The two-part                                                              
implementation approach in the bill will assist in easing the transition                                                        
to a more practical tax base.                                                                                                   

2017-01-18                     House Journal                      Page 0049
While the proposed tax increase may appear to represent a significant                                                           
increase, the tax rates on motor fuel sold or transferred within the state                                                      
have not been raised in many years; for example, the tax on highway                                                             
fuel has remained at eight cents a gallon since 1970. This bill would                                                           
bring Alaska's tax rate on highway fuel very close to the current                                                               
national average of 25 cents a gallon.                                                                                          
Further, this bill would establish as AS 43.40.040 the transportation                                                           
maintenance fund in the general fund. Included in this fund would be                                                            
the existing special highway fuel tax account (AS 43.40.010(g)), the                                                            
special nonpublic highway use account (AS 43.40.010(j)), and the                                                                
special watercraft fuel tax account (AS 43.40.010(f)) for revenue                                                               
generated by the tax. This approach clarifies how motor fuels taxes are                                                         
accounted for in order to allow the Legislature to appropriate funds for                                                        
the purposes set out in each account in the transportation maintenance                                                          
fund, including the direct capital, operating, or maintenance costs of                                                          
water and harbor, and highway infrastructure.                                                                                   
Thank you for your consideration of this measure.                                                                               
Bill Walker