Legislature(2007 - 2008)HOUSE FINANCE 519

04/25/2007 01:30 PM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed to 04:00 pm --
Heard & Held
Moved CSHB 228(L&C) Out of Committee
Moved Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
Presentation: Mega Project Financing by
Frederic Rich, Sullivan & Cromwell LLP
= Previously Scheduled under Legislative
Budget & Audit Committee
HOUSE BILL NO. 184                                                                                                            
     An Act relating to a commemorative troops license                                                                          
     plate; and providing for an effective date.                                                                                
REPRESENTATIVE  BOB  ROSES,  SPONSOR,  introduced  his  staff,                                                                  
JOSH APPLEBEE.                                                                                                                  
Representative  Roses stated  that HB 184  brings the  Support                                                                  
Our Troops  commemorative license  plate to Alaska,  sponsored                                                                  
by Support  Our Troops®  (SOT)  Inc.  The  plate would  happen                                                                  
through   a  $40  fee,   collected  &   appropriated   by  the                                                                  
Legislature  to Support  Our Troops for  redistribution.   SOT                                                                  
establishes  an Alaska  Disbursement  Board  to determine  the                                                                  
best manner to  distribute the funds.  SOT® began  the process                                                                  
of issuing Official Support Our Troops plates in 40 states.                                                                     
Representative  Roses noted  that  Support  Our Troops®  is  a                                                                  
501(c)  (3) national  public-benefit  charity group  dedicated                                                                  
to  assisting the  troops  and their  families.   It  provides                                                                  
simple  means through  which  America's families  can  protect                                                                  
the  integrity  of their  troops'  families.   SOT's  business                                                                  
model is to create  recurring revenue streams  such as license                                                                  
plates, t-shirts, & bumper stickers.                                                                                            
Representative  Roses added  that  SOT is  one  of the  safest                                                                  
national  charities,  with checks  and  balances  in place  to                                                                  
ensure  the accurate  collection  and disbursement  of  funds.                                                                  
Finally,  the bill  provides a  true form of  self taxation  &                                                                  
only those  Alaskans who want to  buy the plates,  would agree                                                                  
to the additional fee.                                                                                                          
2:27:15 PM                                                                                                                    
Representative  Gara suggested  the money  should go to  local                                                                  
veteran  organizations.   Representative  Roses  replied  that                                                                  
many local  organizations  do not have  a mechanism to  handle                                                                  
the funds  nor do they  have accounts  set up.  He  understood                                                                  
that the  dollars gained  would more than  off-set costs.   He                                                                  
believed it was a positive cash flow.                                                                                           
Co-Chair  Meyer   asked  the   local  controls  in   place  to                                                                  
guarantee   that   the   dollars    come   back   to   Alaska.                                                                  
Representative  Roses  explained  that  the  Legislature  will                                                                  
have to  appropriate  the money  each year  & the State  Board                                                                  
would be responsible for the State disbursements.                                                                               
Co-Chair   Meyer  worried   about  appropriating   funds   for                                                                  
something  outside of  Alaska control.   Representative  Roses                                                                  
understood that  they would not have ability to  issue without                                                                  
legislative approval.                                                                                                           
2:32:06 PM                                                                                                                    
MARTIN  BOYER,   (TESTIFIED  VIA  TELECONFERENCE),   EXECUTIVE                                                                  
DIRECTOR,  SUPPORT  OUR TROOPS,  FLORIDA,  offered  to  answer                                                                  
questions of the Committee.                                                                                                     
Representative  Roses  asked  how  much Mr.  Boyer  was  being                                                                  
paid.  Mr. Boyer  responded that he has not been  paid for the                                                                  
past year  and half.   The  funds coming  in go toward  paying                                                                  
lobbyists and  state registration  fees.  He anticipated  that                                                                  
once  money  comes  in,  his  salary  would  be  approximately                                                                  
$5,000/month,   established   by  the   board  of   directors.                                                                  
Representative  Roses  added  that the  Alaska  lobbyist,  Pat                                                                  
Carter was volunteering pro bono.                                                                                               
2:35:26 PM                                                                                                                    
Representative  Crawford   asked  about  inserting  a  sunset.                                                                  
Representative Roses noted that had not been considered.                                                                        
Representative  Crawford worried  about the  variety of  funds                                                                  
created within  the General Fund & recommended  a review date.                                                                  
PAT CARTER,  LOBBYIST,  SUPPORT OUR  TROOPS (SOT),  ANCHORAGE,                                                                  
thought that  it would be  complex to  insert a sunset  when a                                                                  
license  plate was  no longer  valid.   When  the State  stops                                                                  
appropriating  the  money,  the  Division  of  Motor  Vehicles                                                                  
(DMV) would  stop selling  the plates.   It would be  annually                                                                  
reviewed through the appropriation process.                                                                                     
2:39:32 PM                                                                                                                    
DUANE  BANNOCK,  (TESTIFIED  VIA  TELECONFERENCE),   DIRECTOR,                                                                  
DIVISION  OF MOTOR  VEHICLES,  DEPARTMENT  OF  ADMINISTRATION,                                                                  
ANCHORAGE,  addressed the  sunset provision,  noting there  is                                                                  
no downside  to  it.  In  order for  a specialty  plate to  be                                                                  
successful,  it requires marketing  by the sponsoring  agency;                                                                  
from his research,  he did not anticipate that  SOT would "let                                                                  
the State down".  He noted support for the bill.                                                                                
Representative   Crawford  asked  if  1,000  plates   was  the                                                                  
breaking  spot.    Mr. Bannock  advised  that  when  the  bill                                                                  
passes,  DMV will  not have  the plates  on hand.   The  plate                                                                  
will be ordered  and mailed to the addressee.   There is a one                                                                  
time set up fee.                                                                                                                
2:43:18 PM                                                                                                                    
Representative  Thomas voiced  his support  of the troops;  he                                                                  
noted that  he has  a Vietnam  veteran plate  and asked  if he                                                                  
could  purchase  a  second  plate,  placing  it  in  his  back                                                                  
window.    Mr.  Bannock  explained   that  would  not  be  the                                                                  
appropriate   use  of  the  plate.     DMV  is  looking   into                                                                  
2:45:39 PM                                                                                                                    
Representative  Hawker expressed concern with  the addition of                                                                  
a  relationship  and dedication  of  money to  an  independent                                                                  
organization.   He asked  what would happen  if the Red  Cross                                                                  
or Boy  Scouts  asked for  similar treatment.   He  emphasized                                                                  
that another  dedicated fund would  be created and  questioned                                                                  
if  there  was  another  mechanism   to  achieve  the  desired                                                                  
results  through  a  more  generic  empowerment   for  receipt                                                                  
supported services.                                                                                                             
2:50:55 PM                                                                                                                    
Co-Chair    Meyer   echoed   the    concerns   expressed    by                                                                  
Representative  Hawker.  He noted that controls  need to be in                                                                  
Mr.  Carter  recommended  that  the  appropriation   could  be                                                                  
subject to inspection  of the federal 501(c) (3)  to make sure                                                                  
the  nonprofit  is in  compliance  with the  Internal  Revenue                                                                  
Service  (IRS) regulations.   Representative  Hawker  stressed                                                                  
the  need for  further  due  diligence  and inspection  due  a                                                                  
State procurement  contract.   He added  the myriad of  issues                                                                  
needed to address a contractual relationship.                                                                                   
Mr.  Boyer spoke  in  favor of  the  placing the  language  in                                                                  
statute.   He observed  that  the relationship  would be  law,                                                                  
not  contract   and  that  the   language  is  simple.     The                                                                  
philosophy of the  majority of the states is that  the program                                                                  
would  be  self   policing,  because  the  public   would  not                                                                  
purchase  the   plates  if  the  operation  is   in  question.                                                                  
Charities  and government  are in the  business of  benefiting                                                                  
the  public.     He   maintained  that   the  IRS   supervises                                                                  
charitable operations.                                                                                                          
2:58:10 PM                                                                                                                    
Co-Chair  Meyer noted  that Minnesota  passed  a similar  law,                                                                  
and  that  the  money was  provided  to  their  Department  of                                                                  
Military and Veterans Affairs and appropriated from there.                                                                      
Mr. Carter  stressed that  the person  spending the extra  $40                                                                  
to support  the charity  might question  the money going  to a                                                                  
State  organization instead  of the  charity.   He also  noted                                                                  
the additional associated costs.                                                                                                
3:00:29 PM                                                                                                                    
Representative  Gara summarized  that  the money  would go  to                                                                  
the General Fund,  rather recommending language  to direct the                                                                  
Mr.  Boyer  thought  that the  Department  of  Law's  attorney                                                                  
general's   office  would  be   the  best  place   to  examine                                                                  
charitable  funds.  He emphasized  that the bureaucracy  could                                                                  
prevent  the  funds  from  being issued  and  that  there  are                                                                  
complications.   He maintained  that we are "neighbors  trying                                                                  
to  do something  for neighbors"  and  that it  should not  be                                                                  
viewed  as a governmental  association.   He  spoke to  checks                                                                  
and balances  and  noted that  a disbursement  board had  been                                                                  
created,    which   sometimes    uses   existing    charities.                                                                  
Disbursement  decisions are  made based  on paperwork  that is                                                                  
filed  out.   There  is  no one  at  the local  level  writing                                                                  
3:06:00 PM                                                                                                                    
In response  to a question  by Co-Chair Meyer,  Representative                                                                  
Rose noted  that he supported  the disbursement  to go  to the                                                                  
local   disbursement   board  without   moving   through   the                                                                  
Department of Military and Veterans Affairs.                                                                                    
3:08:29 PM                                                                                                                    
Representative  Hawker felt that  a solution could  be crafted                                                                  
through  a   single  department.     He  wanted  to   look  at                                                                  
alternative structures  for Alaska's constitutional  framework                                                                  
to keep the State away from making charitable decisions.                                                                        
3:11:30 PM                                                                                                                    
Representative  Gara  MOVED to  ADOPT  new Amendment  #1,  25-                                                                  
LS0621\K.1, Luckhaupt, 4/23/07.  Co-Chair Meyer OBJECTED.                                                                       
Representative  Gara explained new  Amendment #1, which  would                                                                  
correct  a problem  where people  are  periodically sited  for                                                                  
driving without  insurance when they actually  have it.  Proof                                                                  
of insurance  must be filled out  at the time of accident.   A                                                                  
form must be  sent as a follow up.   The form must  be sent to                                                                  
the registered  address even if  a better address is  given at                                                                  
the scene  of the accident.   The  amendment allows the  forms                                                                  
to  be   sent  to  the  most   recent  address  and   prevents                                                                  
unnecessary  felony charges.    The amendment  also moves  the                                                                  
sentencing language.                                                                                                            
Representative   Roses  stated  he  did  not   object  to  the                                                                  
Vice  Chair Stoltze  asked  if  it had  been reviewed  by  the                                                                  
Department of Public Safety.                                                                                                    
3:15:51 PM                                                                                                                    
Representative  Gara stated he had  worked with the  sponsor &                                                                  
the Division of  Motor Vehicles.  He added he  could submit it                                                                  
to the  Department  of Public Safety  before  it moves to  the                                                                  
House Floor.  He reiterated that it is technical.                                                                               
3:18:10 PM                                                                                                                    
Mr. Bannock  voiced strong  support for  the new Amendment  1.                                                                  
He added that they also support Amendment 2.                                                                                    
Co-Chair  Meyer requested  that  copies of  the amendments  be                                                                  
distributed to  both the Department of Law and  the Department                                                                  
of Public Safety for their review.                                                                                              
Representative   Gara  WITHDREW   the  MOTION  to   adopt  new                                                                  
Amendment #1.  There being NO OBJECTION, it was withdrawn.                                                                      
HB 184 was HELD in Committee for further consideration.                                                                         
3:22:01 PM                                                                                                                    

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