Legislature(2015 - 2016)BARNES 124

03/24/2015 08:00 AM COMMUNITY & REGIONAL AFFAIRS


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 146 MUNICIPAL TAX EXEMPTION TELECONFERENCED
Moved CSHB 146(CRA) Out of Committee
-- Public Testimony --
+ HB 118 MUNI ENERGY IMPROVEMNT ASSESSMNTS/BONDS TELECONFERENCED
<Pending Referral>
+ SB 19 BOUNDARIES OF ROAD SERVICE AREAS TELECONFERENCED
Heard & Held
-- Public Testimony --
                 HB 146-MUNICIPAL TAX EXEMPTION                                                                             
                                                                                                                                
8:05:20 AM                                                                                                                    
                                                                                                                                
CHAIR TILTON announced that the  first order of business would be                                                               
HOUSE  BILL  NO.  146,  "An  Act  relating  to  a  municipal  tax                                                               
exemption for certain subdivided property."                                                                                     
                                                                                                                                
8:05:39 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  moved  to  adopt CSHB  146,  Version  29-                                                               
LS0048\W, Shutts, 3/20/15, as the working document.                                                                             
                                                                                                                                
CHAIR TILTON objected for discussion purposes.                                                                                  
                                                                                                                                
8:06:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CATHY MUNOZ,  Alaska State  Legislature, speaking                                                               
as  the  sponsor  of  HB   146,  explained  that  HB  146  allows                                                               
municipalities  the option  to  defer  a portion  or  all of  the                                                               
increased  tax   assessment  that  occurs  when   a  property  is                                                               
subdivided.   Currently, when  a property  is subdivided  and the                                                               
owner  certifies  the  plat,  the  assessment  goes  to  a  post-                                                               
subdivided assessment that  is based on the fair  market value as                                                               
per state  law.  For example,  the assessment in Juneau  of a lot                                                               
with  a pre-subdivided  value  of $100,000  would  be roughly  12                                                               
mills on the $100,000, which amounts  to tax due of about $1,200.                                                               
Once the aforementioned lot is  subdivided into 10 lots to create                                                               
affordable housing,  if the assessment  is $100,000 per  lot, the                                                               
tax assessment  increases from  roughly $1,200  to $12,000.   The                                                               
aforementioned increase  is made prior  to any of the  lots being                                                               
sold or any work occurring on  the land.  Therefore, it's a great                                                               
disincentive and  deterrent to creating affordable  housing.  She                                                               
reiterated  that HB  146 provides  a municipality  the option  to                                                               
exempt a portion  or all of the increased assessed  value of [the                                                               
subdivided]  land  until  a  lot  sold,  a  building  permit  was                                                               
acquired, or a  temporary structure was located  on the property.                                                               
Version W  includes language clarifying that  any structure would                                                               
cause the increased evaluation.                                                                                                 
                                                                                                                                
8:09:28 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  asked  if the  assessment  referenced  in                                                               
HB 146 only deals  with property tax.  He  recalled that recently                                                               
in  Homer there  was a  per lot  assessment for  the natural  gas                                                               
expansion and  line construction.   He related  his understanding                                                               
that HB 146 only refers to  a property tax assessment and doesn't                                                               
include individual lot assessments for other purposes.                                                                          
                                                                                                                                
REPRESENTATIVE  MUNOZ said  the intent  of the  law is  to create                                                               
more  affordable  housing.   The  legislation  provides  a  local                                                               
option for municipalities, such  that municipalities can create a                                                               
partial  or full  exemption on  the  number of  lots that  target                                                               
affordable housing.   She clarified that this  local option would                                                               
require assembly action.                                                                                                        
                                                                                                                                
REPRESENTATIVE SEATON expressed  the need to clarify  that it's a                                                               
property tax exemption to which the language refers.                                                                            
                                                                                                                                
REPRESENTATIVE   MUNOZ  confirmed   the  legislation   refers  to                                                               
property tax exemptions.                                                                                                        
                                                                                                                                
8:11:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NAGEAK asked  whether the  tax exemption  is only                                                               
for low income housing.                                                                                                         
                                                                                                                                
REPRESENTATIVE  MUNOZ  reiterated   that  the  legislation  would                                                               
create more  housing in general,  which would place  more housing                                                               
on the market.   The aforementioned benefits  all valued housing.                                                               
In  Juneau,  because of  the  high  carrying  cost of  the  added                                                               
taxation, the actual  sale price is much higher than  it would be                                                               
were HB 146  in place.  She further reiterated  that the taxation                                                               
is so sharp when property is  subdivided that the property has to                                                               
reflect that  higher taxation when  the lot is sold.   Therefore,                                                               
HB 146  is a  means to  keep the  prices down  on the  land sale.                                                               
Once  the land  sells, the  city reassesses  the property  at the                                                               
fair  market value  and  the  full taxation  would  be  due.   In                                                               
further response  to Representative Nageak,  Representative Munoz                                                               
clarified that  HB 146 would create  housing opportunities across                                                               
the spectrum  [of income levels],  depending on the value  of the                                                               
land.   She then pointed out  that HB 146 is  beneficial in terms                                                               
of creating  more affordable housing  because it keeps  the price                                                               
of the land down.                                                                                                               
                                                                                                                                
8:13:23 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HUGHES  noted her  appreciation for the  intent of                                                               
the  legislation.   However, she  expressed the  need to  be sure                                                               
that local  governments are not  selecting winners and  losers in                                                               
terms of developers  because the language seems to read  as if it                                                               
speaks to a  particular piece of property.  She  then inquired as                                                               
to whether the passage of  a tax exemption ordinance, as proposed                                                               
in HB 146, would be an areawide ordinance.                                                                                      
                                                                                                                                
REPRESENTATIVE  MUNOZ  answered  that  the  passage  of  such  an                                                               
ordinance  would be  across the  board.   A  city assembly  would                                                               
adopt an ordinance structured as  a partial of full exemption for                                                               
no  more than  five years,  but once  passed the  ordinance would                                                               
apply to all residential subdivided properties.                                                                                 
                                                                                                                                
8:14:27 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND pointed  out that the language  of HB 146                                                               
refers  to an  exemption from  property taxes,  while letters  of                                                               
support refer to abatement, deferral,  defer, and exemption.  She                                                               
then  requested an  example of  what [HB  146] means  because the                                                               
aforementioned  terms   mean  something  different.     She  then                                                               
inquired as to  whether the legislation will  exempt the property                                                               
until there  is development  on the  property in  the form  of an                                                               
improvement.    She  then  related  her  understanding  that  the                                                               
property tax  increase wouldn't be  collected or in  effect until                                                               
the first improvement on the first lot in the subdivision.                                                                      
                                                                                                                                
REPRESENTATIVE  MUNOZ  explained that  as  soon  as the  land  is                                                               
subdivided and  the plat  registered with  the city  and borough,                                                               
the  value  is reassessed.    This  legislation, she  reiterated,                                                               
would allow  a municipality the  option to exempt  that increased                                                               
value until  the lot sold, a  building permit was acquired,  or a                                                               
structure  was  located   on  the  parcel.    When   one  of  the                                                               
aforementioned occurs, the  exemption would not be  in effect and                                                               
the lot would be assessed at the full market value.                                                                             
                                                                                                                                
8:16:01 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NAGEAK  inquired as to how  this legislation would                                                               
work  in  rural Alaska  where  land  is  owned by  Alaska  Native                                                               
corporations.       In   response   to    Representative   Munoz,                                                               
Representative  Nageak  clarified  that   land  owned  by  Alaska                                                               
corporations is within a city and taxable.                                                                                      
                                                                                                                                
REPRESENTATIVE MUNOZ  said that if  there is planning  and zoning                                                               
authority  and a  city assembly/council  that could  consider the                                                               
exemption,  then HB  146 would  apply.   In  further response  to                                                               
Representative   Nageak,   Representative   Munoz   related   her                                                               
understanding  that the  Fairbanks North  Star Borough  does have                                                               
planning and zoning  authority.  She further related  that HB 146                                                               
requires an action of a city/borough assembly.                                                                                  
                                                                                                                                
8:17:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON,  referring to  the  language  on page  1,                                                               
lines  5-7,   related  that  in   the  Kenai   Peninsula  Borough                                                               
subdivisions have  to include  roads, access,  and rights-of-way.                                                               
Therefore, the lots  would have road values.  He  asked if HB 146                                                               
would  mean that  the  roads  and the  other  aspects that  would                                                               
increase the value  of the subdivision wouldn't be  taxable.  Or,                                                               
does  the  language  "or  a  portion  of  the  increase"  mean  a                                                               
municipality could determine  whether the portion is  going to be                                                               
the value  of lots exclusive  of roads.   He questioned  what the                                                               
language "a portion of" could encompass.                                                                                        
                                                                                                                                
REPRESENTATIVE  MUNOZ  explained  that state  law  requires  fair                                                               
market  value assessments,  such that  the road  and improvements                                                               
would  be included  in the  fair  market value  assessment.   The                                                               
language "all  or a portion"  in HB  146 refers to  the increased                                                               
value of  that land.  The  individual lots of a  subdivided large                                                               
parcel have  increased value.  When  an improvement is made  on a                                                               
specific lot, the higher assessment comes into play.                                                                            
                                                                                                                                
8:19:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON referred to  the following language on page                                                               
1, "any  improvements made  to the  property necessitated  by its                                                               
subdivision."    He  posed  a   scenario  in  which  there  is  a                                                               
requirement for  utilities or  other such things  to be  put into                                                               
the lots  and asked whether  those would be included  or excluded                                                               
by  the  municipality.   He  reiterated  that  he was  trying  to                                                               
determine the meaning  "of a portion."  He asked  if the language                                                               
means  50  percent  of  the  increase  or  portions  as  required                                                               
improvements by the subdivision.                                                                                                
                                                                                                                                
REPRESENTATIVE  MUNOZ  specified  that  the  language  means  the                                                               
increased  value of  the  specific lot.    The improvements,  she                                                               
stated, will be  part of the value because as  a property and its                                                               
surroundings   are   improved,   the  values   increase.      The                                                               
aforementioned is based on state law, she pointed out.                                                                          
                                                                                                                                
8:20:43 AM                                                                                                                    
                                                                                                                                
CHAIR TILTON opened public testimony.                                                                                           
                                                                                                                                
8:21:01 AM                                                                                                                    
                                                                                                                                
MERRILL  SANFORD, Mayor,  City &  Borough  of Juneau;  Treasurer,                                                               
Board  of   Directors,  Southeast  Conference,   highlighted  the                                                               
shortage of housing in Juneau  and suggested that there is likely                                                               
a shortage of housing in other  communities in the state as well.                                                               
Although  the City  &  Borough of  Juneau  helps legislators  and                                                               
staff with  housing to make  it easier for  them to come  and go,                                                               
there are  still many who  can't find housing.   He characterized                                                               
HB  146  as  a  tool  for the  local  [governments].    Once  the                                                               
legislation is passed, the local  governments can adopt what they                                                               
desire in  accordance with the  act.  Mayor  Sanford acknowledged                                                               
that HB 146 won't solve all  the problems, but it's one option to                                                               
address housing  problems.  Mayor  Sanford concluded  by relating                                                               
the City &  Borough of Juneau's support for HB  146 and urged its                                                               
passage.                                                                                                                        
                                                                                                                                
8:22:47 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  said he  supports the  concept of  HB 146,                                                               
but is trying  to fully understand whether it's all  or a portion                                                               
of  the increase.   He  asked  if Mayor  Sanford understands  the                                                               
language "a  portion of"  to mean  that under HB  146 the  City &                                                               
Borough of Juneau could, for up  to five years, exempt 50 percent                                                               
of the increased valuation.                                                                                                     
                                                                                                                                
MAYOR SANFORD replied yes.                                                                                                      
                                                                                                                                
8:23:40 AM                                                                                                                    
                                                                                                                                
CHUCK HOMAN,  President, Alaska State Home  Building Association,                                                               
related support for  HB 146, and noted that  the committee packet                                                               
should include  a letter  of support from  the Alaska  State Home                                                               
Building Association.  He concurred  with earlier remarks that in                                                               
many  communities   there  is  a  shortage   of  developed  lots.                                                               
Furthermore, Alaska has some of  the highest land and development                                                               
costs  as well  as  some of  the highest  property  taxes in  the                                                               
nation.  Furthermore,  once a property is developed,  it can take                                                               
years to absorb  the lots that are developed.   This legislation,                                                               
he   opined,  is   an  opportunity   for  local   communities  to                                                               
participate with the developer and  stimulate a piece of raw land                                                               
that  may otherwise  go undeveloped.    He pointed  out that  new                                                               
housing  provides  new  jobs  for   the  local  community  during                                                               
construction  as   well  as  the   ongoing  effect  of   the  new                                                               
construction.  Moreover,  raw land improved to  a developed piece                                                               
of  property  with  a  homeowner  expands the  tax  base  of  the                                                               
community and improves the quality of life of the community.                                                                    
                                                                                                                                
8:25:12 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE REINBOLD  inquired as to whether  the Alaska State                                                               
Home Building Association was in unanimous support of HB 146.                                                                   
                                                                                                                                
MR. HOMAN  replied yes.   In  further response  to Representative                                                               
Reinbold,  Mr.   Homan  said  the  Alaska   State  Home  Building                                                               
Association has no concerns.                                                                                                    
                                                                                                                                
8:26:00 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  asked  whether   the  Alaska  State  Home                                                               
Building  Association understands  that the  exemption is  a one-                                                               
time exemption on the subdivision.                                                                                              
                                                                                                                                
MR. HOMAN  answered yes, adding  that he  believes an end  to the                                                               
exemption is reasonable.                                                                                                        
                                                                                                                                
8:26:57 AM                                                                                                                    
                                                                                                                                
SHIRLEY MARQUARDT,  Mayor, City of Unalaska,  related her support                                                               
for  HB  146.   She  informed  the  committee that  Unalaska  has                                                               
struggled with a housing shortage and  how to address it from the                                                               
municipality side for years.  With  the high cost of building and                                                               
transporting materials, both  of which are not  under the control                                                               
of the  municipality, the City  of Unalaska has  really struggled                                                               
to get  two of  the city's largest  property owners  to subdivide                                                               
their properties to plan utilities and  place them for sale.  She                                                               
related  that last  fall  Unalaska held  a  town hall  discussion                                                               
regarding  what the  city can  do to  address housing  issues and                                                               
bring down the cost.  During  that meeting the idea of a property                                                               
tax exemption for newly subdivided  properties for a period of up                                                               
to  five  years was  mentioned.    The  city then  discovered  it                                                               
couldn't  create the  aforementioned exemption,  but could  defer                                                               
the property tax  for up to five  years.  However, at  the end of                                                               
the five years  whomever purchased the property  or the developer                                                               
would  owe a  large amount,  which defeated  the purpose.   Mayor                                                               
Marquardt related  her understanding that  HB 146 would  work for                                                               
Unalaska.  She remarked that  the legislation is very flexible as                                                               
it  provides  local  assemblies  or  councils  along  with  their                                                               
planning  and  zoning boards,  through  the  public process,  the                                                               
ability to decide whether to have  a partial or full exemption as                                                               
well as  the length of  the exemption.   She then noted  that she                                                               
likes that the exemption ends when  the lot is sold or a building                                                               
permit is issued.  She noted  that some of the larger land owners                                                               
don't want to sell their land,  but may be willing to develop it.                                                               
The aforementioned is a win all the way around.                                                                                 
                                                                                                                                
8:30:47 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON, referring to the  language on page 1, line                                                               
5, "all or portion of  increase in assessed value", asked whether                                                               
a municipality could  take a percentage or a flat  amount per lot                                                               
exemption.                                                                                                                      
                                                                                                                                
8:31:27 AM                                                                                                                    
                                                                                                                                
RON  BROWN,  State Assessor,  Division  of  Community &  Regional                                                               
Affairs,   Department   of   Commerce,   Community   &   Economic                                                               
Development,  pointed  out that  the  legislation  speaks to  the                                                               
increase   in   value   caused  by   the   subdivision   or   any                                                               
infrastructure installed in the process.   He posed an example in                                                               
which a  larger parcel with a  value of $2.50 per  square foot is                                                               
subdivided into 10  lots that become worth $5.00  per square foot                                                               
after  the  subdivision and  installation  of  roads, sewer,  and                                                               
water.   As HB 146 is  currently written, the value  eligible for                                                               
the  exemption  would  be the  difference  between  the  original                                                               
assessment  and the  increased value.   Therefore,  the exemption                                                               
amount would be dependent upon  the local market, the increase in                                                               
the value, and what caused the increase in value.                                                                               
                                                                                                                                
8:33:24 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON surmised then  that in Mr. Brown's example,                                                               
the  $3  per square  foot  exemption  could  be structured  as  a                                                               
percentage of  the increase in value  or as a flat  amount of the                                                               
increase in value at the local option.                                                                                          
                                                                                                                                
MR.  BROWN responded  yes, the  increase in  value caused  by the                                                               
subdivision  installation  of  the  infrastructure  is  what  the                                                               
municipality  could exempt  if HB  146 was  adopted by  the local                                                               
governing  body.   He said  the local  governing body  would have                                                               
considerable freedom  in terms of  the structure of  the optional                                                               
exemption.                                                                                                                      
                                                                                                                                
8:34:23 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON asked  if a per lot  assessment for placing                                                               
a utility  throughout an area, would  come into play with  HB 146                                                               
or does it just deal with property taxes.                                                                                       
                                                                                                                                
MR. BROWN answered that HB 146 only refers to property taxes.                                                                   
                                                                                                                                
8:35:42 AM                                                                                                                    
                                                                                                                                
DAVE  HANNA related  that  he  has been  involved  in working  on                                                               
subdivisions and  subdividing land  most of his  adult life.   He                                                               
said  he didn't  believe  there are  any bad  points  to HB  146.                                                               
First, he highlighted that HB  146 is enabling legislation, not a                                                               
mandate.   Municipalities are  left entirely  in control  of what                                                               
they want to do  with HB 146.  With regard to  how HB 146 impacts                                                               
the cost of  providing a subdivision, Mr. Hanna  pointed out that                                                               
the  larger the  subdivision, the  larger  the numbers  are.   He                                                               
posed a situation in which a  small developer has a block of land                                                               
that he/she  wants to subdivide into  10 lots and leave  the rest                                                               
untouched.   Since subdividing  rules may  change over  time, for                                                               
most [developers]  it makes sense  to subdivide the  entire piece                                                               
of property  [to 40 lots].   However,  once the plat  is recorded                                                               
all  the lots  are taxed  and the  developer could  suddenly face                                                               
taxes  that  total $60,000  and  a  shovel  of dirt  hasn't  been                                                               
turned.     Therefore,  it's   a  disincentive   for  developers,                                                               
especially when  one realizes how  cyclical the market is.   With                                                               
regard  to  those  who  believe   this  legislation  could  cause                                                               
municipalities to  lose revenue, Mr.  Hanna opined that  it's the                                                               
exact opposite.   He explained that the cost of  a lot is roughly                                                               
a  fourth of  the value  of a  finished house.   Therefore,  if a                                                               
house is constructed  within three to four years of  the time the                                                               
lot  was subdivided,  the municipality  has already  recouped any                                                               
money  they  might  have  made   by  taxing  those  vacant  lots.                                                               
Bringing  houses  online  sooner,   the  revenue  stream  to  the                                                               
municipality is  a lot larger than  it would've been.   Mr. Hanna                                                               
then  related  his belief  that  the  proposal  in HB  146  would                                                               
actually lower  the sale price of  the lots as it  will encourage                                                               
more lots  to come  online.   When more  lots are  available, the                                                               
lots  won't be  sold  at inflated  prices.   He  opined that  the                                                               
aforementioned  would  be good  for  everyone  and lead  to  more                                                               
affordable housing.                                                                                                             
                                                                                                                                
8:39:21 AM                                                                                                                    
                                                                                                                                
NORTON  GREGORY, Executive  Team, Tlingit-Haida  Regional Housing                                                               
Authority,  informed the  committee that  although he  is also  a                                                               
member  of  the  Juneau   Affordable  Housing  Commission,  which                                                               
reports  to the  City &  Borough  of Juneau  Assembly on  housing                                                               
matters that  impact the  community, he  isn't speaking  on their                                                               
behalf today.  He then  informed the committee that Tlingit-Haida                                                               
Regional Housing Authority is the  largest provider of affordable                                                               
housing in  Southeast Alaska.   He echoed earlier  testimony that                                                               
HB 146 would provide an  incentive for property owners to develop                                                               
their  currently  undeveloped  properties.     In  speaking  with                                                               
property  owners  in  Juneau,  [the   discussion]  turns  to  the                                                               
shortage of buildable land.  Some  of the available land is being                                                               
held because  the owner doesn't want  to subdivide it due  to the                                                               
increased  property  taxes.    He  informed  the  committee  that                                                               
[Tlingit-Haida Regional  Housing Authority] was happy  to see the                                                               
2012 change  in which the  state allowed property  tax deferment.                                                               
However,   since   the   aforementioned   change   didn't   spark                                                               
subdivision and  development of properties, he  expressed support                                                               
for  the change  from a  property tax  deferment to  property tax                                                               
abatement as embodied in HB  146.  Mr. Gregory encouraged support                                                               
for  HB  146, which  he  opined  would  create an  incentive  for                                                               
property   owners    to   subdivide   their    property   without                                                               
penalization.                                                                                                                   
                                                                                                                                
8:41:39 AM                                                                                                                    
                                                                                                                                
RUSS  MCDOUGAL  informed  the  committee  that  he  is  a  former                                                               
president of  the Alaska State Homebuilder's  Association and was                                                               
involved in the  tax deferral legislation.   Mr. McDougal related                                                               
that  the  Alaska  State  Homebuilder's  Association  has  always                                                               
supported tax abatement.  He then noted  that he is a member of a                                                               
code   review  committee   of  the   Juneau  Affordable   Housing                                                               
Commission,  has been  a builder  for the  past 20  years, and  a                                                               
carpenter for 35 years.                                                                                                         
                                                                                                                                
8:43:02 AM                                                                                                                    
                                                                                                                                
CHAIR TILTON,  upon determining  no one  else wished  to testify,                                                               
closed public testimony.                                                                                                        
                                                                                                                                
8:43:25 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  related  his  appreciation  for  HB  146,                                                               
including clarifications  that the  legislation offers  a single-                                                               
time exemption  that can't be  renewed; allows the  community the                                                               
option as to  the amount of the [exemption]; and  only relates to                                                               
property taxes.                                                                                                                 
                                                                                                                                
8:44:13 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE ORTIZ  inquired as to  why the proposal in  HB 146                                                               
isn't already in place.                                                                                                         
                                                                                                                                
REPRESENTATIVE MUNOZ  explained that state law  requires property                                                               
to be assessed at fair market  value, and thus once a property is                                                               
subdivided the  market value increases  as do the taxes  on those                                                               
parcels.                                                                                                                        
                                                                                                                                
8:45:29 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  ORTIZ  asked  whether  the  ability  of  a  local                                                               
municipality   to  partially   abate   taxes   would  allow   the                                                               
municipality the ability to pick and choose winners.                                                                            
                                                                                                                                
REPRESENTATIVE MUNOZ explained that  if a municipality chooses to                                                               
participate in the [exemption proposed  in HB 146], it would have                                                               
to pass an  ordinance to establish the parameters  of the program                                                               
and it would apply to all housing subdivisions.                                                                                 
                                                                                                                                
8:46:22 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON reiterated  that the  100 percent  of full                                                               
market value is necessary so  that taxations across the state are                                                               
equivalent  and then  municipalities  set the  mill  rate for  10                                                               
percent of  fair market value.   Municipalities, he  pointed out,                                                               
[currently] have the  flexibility to change their  mill rate, but                                                               
not to  decide how  much of  the fair  market value  is assessed.                                                               
The proposed exemption in HB 146  is for a limited period of time                                                               
and doesn't  extend beyond the  subdivision.   The aforementioned                                                               
is important but  necessary to ensure that  valuations across the                                                               
state are 100  percent of the fair market value  so that there is                                                               
equality.                                                                                                                       
                                                                                                                                
8:47:34 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HUGHES asked whether  this legislation would apply                                                               
to a commercial or business property that is subdivided.                                                                        
                                                                                                                                
REPRESENTATIVE MUNOZ replied yes.                                                                                               
                                                                                                                                
MR.  BROWN  confirmed  that  although  subdivision  is  typically                                                               
associated with residential  properties, this [legislation] would                                                               
also apply to commercial properties as well.                                                                                    
                                                                                                                                
8:48:53 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SEATON  opined that use of  the term "established"                                                               
[on page  1, line 12]  in Version W  is important because  use of                                                               
the  term "constructed"  could  result  in commercial  properties                                                               
being used as  storage lots fitting into  the proposed exemption.                                                               
He  noted  his  appreciation  for   the  sponsor  addressing  the                                                               
aforementioned.                                                                                                                 
                                                                                                                                
8:49:40 AM                                                                                                                    
                                                                                                                                
CHAIR  TILTON withdrew  her objection.   There  being no  further                                                               
objection, CSHB  146, Version  29-LS0048\W, Shutts,  3/20/15, was                                                               
adopted.                                                                                                                        
                                                                                                                                
8:49:49 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  moved   to  report  Version  29-LS0048\W,                                                               
Shutts,    3/20/15,   out    of    committee   with    individual                                                               
recommendations  and the  accompanying zero  fiscal note.   There                                                               
being no  objection, CSHB  146(CRA) was  reported from  the House                                                               
Community and Regional Affairs Standing Committee.                                                                              

Document Name Date/Time Subjects
CSSB 19, Version H.pdf HCRA 3/24/2015 8:00:00 AM
SB 19
Fiscal Note, CSSB 19.pdf HCRA 3/24/2015 8:00:00 AM
SB 19
Sponsor Statement, CSSB 19.pdf HCRA 3/24/2015 8:00:00 AM
SB 19
Sponsor Supporting Documents, CSSB 19.pdf HCRA 3/24/2015 8:00:00 AM
SB 19
HB 146 AK Homebuilder Support.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 McDougal Support Letter.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 Juneau Affordable Housing Commission.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 SE Alaska Building Industry Association.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 Sectional.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 Supporting, CBJ.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 Unalaska Support.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
CSHB 146 (CRA), VersionW.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146-DCCED-DCRA-03-20-15.pdf HCRA 3/24/2015 8:00:00 AM
HB 146
HB 146 Leg Research.pdf HCRA 3/24/2015 8:00:00 AM
HB 146