Legislature(2003 - 2004)
02/24/2004 01:54 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE JOINT RESOLUTION NO. 20
Proposing amendments to the Constitution of the State
of Alaska repealing the prohibition on dedicated funds.
REPRESENTATIVE BEVERLY MASEK explained that HJR 20 would add
a new section #18 to Article IX of the Constitution.
Specifically, if passed and adopted at the November 2004
general election, a dedicated fund would be established
requiring all taxes generated through the sale of motor
fuels to be placed in the fund for the express purpose of
maintaining Alaska's roads and highways. She added that
Alaska's Constitution prohibits dedicated funds except for
the Permanent Fund, Constitutional Budget Reserve (CBR) Fund
and those dedicated funds in existence prior to statehood.
She added that motor fuel taxes in all states are dedicated
in some fashion for road and highway maintenance.
Currently, in Alaska, motor fuel taxes are deposited in a
special highway fuel tax account in the general fund, which
allows them to be appropriated for any budget expense.
Representative Masek urged members to pass HJR 20 from
Committee.
Co-Chair Harris inquired if the gas tax was currently at
eight cents per gallon. Representative Masek replied it is.
Co-Chair Harris asked if it had been proposed to increase
that tax by twelve cents, making it total twenty cents per
gallon. Representative Masek noted that is the proposed
increase indicated in the Governor's bill.
Co-Chair Harris stated that the proposed intent for the
legislation would place before the voters a decision whether
or not a dedicated fund be created for all gas tax revenue
placing it in the dedicated fund for highway maintenance
use. Representative Masek acknowledged that was correct and
that the money would be used to maintain highways and
infrastructure. She stated that in the previous
Administration, the funding had been cut and some Department
of Transportation & Public Facilities workers were removed
from the Willow Maintenance station and the Kenai Peninsula.
She indicated that when Governor Murkowski took office,
those workers were placed back into those stations. During
the winter months, the workforce must be available. Passing
the resolution would help eliminate problems that have
occurred in the past.
Co-Chair Harris inquired why the founders of the
Constitution had a prohibition against dedicated funds.
Representative Masek did not know. Co-Chair Harris
understood that it was so the Legislature would have full
authority of monies available year to year.
Representative Croft acknowledged that was true and added
that at the time the Alaskan Constitution was written, other
states were declaring bankruptcy because they had all their
revenue sources dedicated to specific places.
Representative Fate mentioned that with passage of the
st
legislation, revenues received after December 1, 2004,
would be used to fund that fund. He asked the amount
anticipated and what additional money would need to be
placed into the fund so that from the inception date, there
would be enough.
Representative Masek responded that would be premature to
calculate. The resolution would only bring it to the people
for a vote. She did not know the fate of the Governor's
motor fuel tax bill. She reiterated that currently, the
State collects eight cents a gallon and it is placed back
into the general fund.
Representative Fate voiced concern that the fund would not
have enough capital to undertake projects that the voters
anticipate but the State would be "locked in". He asked if
the reference to highways and roads would include the
railroad. Representative Masek responded it would not.
Representative Stoltze questioned if the legislation would
help promote passage of the gas tax. Representative Masek
advised that this legislation has been proposed because of
the Governor's twelve-cent increase gas tax bill.
Representative Stoltze clarified that Representative Masek's
intent was anticipating that the tax would pass and this
legislation would then guarantee that it was used for the
intended purpose. Representative Masek acknowledged that
was correct.
Co-Chair Harris asked how much general fund money has been
spent yearly on highway maintenance. Representative Foster
replied $97 million dollars.
Co-Chair Harris asked how much the State generates from the
eight cents per gallon tax. Representative Foster responded
that it amounted to between $50-$60 million dollars. Co-
Chair Harris pointed out given that amount, the State spends
nearly $30 to $40 million dollars more on highway
maintenance then is generated. Representative Foster
commented that number would result from twenty cents per
gallon. At eight-cents per gallon, the amount would be much
less.
PETE ECKLUND, STAFF, REPRESENTATIVE BILL WILLIAMS,
interjected that at eight-cents per gallon, the number would
generated would be approximately $37 million dollars.
Co-Chair Harris declared that the State is currently
spending approximately $80 million dollars on highway
maintenance from the general funds. He stated that it
appears that all money brought into the State from the
current gas tax has been "dedicated" for highway
maintenance. Co-Chair Harris commented that he was
attempting "to get a handle" on how much money was being
spent from the general fund outside of the amount generated
from the gas tax.
Representative Hawker noted that there are a few funds that
have been "grandfathered" in. He asked if one of those
funds was a highway maintenance fund.
Representative Masek responded that there is one specific
fund called the King Salmon Stamp that places money back
into habitat restoration projects. She noted that there is
not a highway-dedicated fund at this time. Representative
Foster mentioned that there might be a marine highway fund.
Co-Chair Harris remarked that there is a marine highway fund
but that he did not believe it was dedicated. Co-Chair
Williams interjected that it is not a dedicated fund.
Co-Chair Harris stated that HJR 20 would be HELD in
Committee for further consideration.
Co-Chair Williams indicated that he would work with
Representative Masek's office on the proposed legislation.
HJR 20 was HELD in Committee for further consideration.
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