Legislature(1997 - 1998)
04/11/1997 01:13 PM House JUD
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HJR 18 - DEDICATED FUNDS: RATE MAY BE CHANGED Number 1143 CHAIRMAN GREEN advised members that because the prime sponsor of HB 132 was not available, they would next consider HJR 18, proposing an amendment to the Constitution of the State of Alaska relating to changing the rate of a tax or license that supports a dedication of its proceeds. CHAIRMAN GREEN called a brief at-ease at 1:35 p.m., and he reconvened the meeting at 1:38 p.m. REPRESENTATIVE IVAN IVAN, Prime Sponsor, HJR 18, advised members that HJR 18 proposed an amendment to Article IX, Section 7 of the State Constitution. He pointed out that the current article allowed for the dedication of funds for a specific purpose, as long as it existed by April 24, 1956. Representative Ivan explained that the proposed resolution would allow a changing of a rate of a tax or license of which the proceeds were dedicated to a special purpose. He advised members that the proposed amendment would be placed before the voters at the next general election if approved by the Legislature. REPRESENTATIVE IVAN advised members that he introduced the legislation because of the difference in opinions presented by the Attorney General's office and Legislative Legal Services regarding the dedication of a tax to a specific purpose. He stated that in order to avoid litigation, especially if the proceeds of a tobacco tax were to be placed into the school fund, or if the legislature changed any other tax rate, or license fee, into which proceeds were to be placed into a dedicated fund, the resolution could be a solution that would resolve that problem. REPRESENTATIVE IVAN pointed out that an amendment had been adopted by the House State Affairs Committee that would make the amendment retroactive to October 1, 1997. He expressed that the retroactive date coincided with the effective date of the tobacco tax as proposed in CSHB 1(STA). REPRESENTATIVE IVAN noted that he realized what was being proposed was a very debatable issue with various opinions expressed; however, he was considering it as being established prior to the framing of the State Constitution of dedicating funds to the school fund, which at that time was needed for school construction and maintenance. He felt Alaska was back in that position and funds were needed in the area of capital construction and maintenance projects. Number 1368 REPRESENTATIVE ROKEBERG asked if the prohibition against dedicated funds was still consistent with the Constitution under the change that would result from the resolution. REPRESENTATIVE IVAN advised members that would be his understanding, but reiterated that the Attorney General's office and Legislative Legal Services had each provided different opinions that there could be a potential problem. REPRESENTATIVE ROKEBERG asked if they could change the use of the proceeds. REPRESENTATIVE IVAN advised members he was not proposing to change the proceeds, but to increase the dedicated tax. Number 1434 JIM BALDWIN, Assistant Attorney General, Civil Division, Office of the Attorney General, Department of Law, advised members the department testified in the House State Affairs Committee because they had some concerns about the timing of the amendment as it applied to the tax bills that were moving through the legislature. He pointed out that if HJR 18 was going to be considered a part of that package, the department felt there should be some thought given to timing. Mr. Baldwin pointed out that was the reason for the effective date and retroactive effect date in Section 2 of the resolution. MR. BALDWIN advised members he would not characterize the Department of Law as being a supporter of HJR 18, although they saw the wisdom of it. He stated that the department did anticipate litigation with the increase in the tobacco tax, if it became law. CHAIRMAN GREEN asked if the department anticipated litigation from a particular group, or the fact that it appeared too high from the general public. MR. BALDWIN clarified that the department anticipated litigation would result because a tax payer might protest the increase in the tax. He explained that the department would handle that case through the normal process of a tax protest, which would then be elevated to the courts, and ultimately to the appellate courts. MR. BALDWIN pointed out that, in the minds of the legislature, the preferred interpretation in the tobacco tax bill was that the rate of a tax could be changed and it was valid under present reading of the constitution. He stated that it had a fall-back provision that said, just in case, to make sure the tax remained imposed, and to take other measures there would be a fall-back tax to the general fund. Mr. Baldwin advised members that the measure before them could, perhaps, cast some doubt as to whether the legislature really believed in its primary construction of the constitution. Mr. Baldwin stated that by advancing HJR 18, they could create an argument on the side of those who wanted to attack the tobacco tax. MR. BALDWIN advised members that the administration's perspective, and that of the Attorney General's office, felt that there could be another legal interpretation that would carry the day, and one that had been consistently applied since 1956, that the rate of a tax could not be changed. He stated that in weighing it out, perhaps HJR 18 was the better approach and expressed that the sponsor was being very courageous to come forward and suggest a change to the constitution which would eliminate all debate. Mr. Baldwin advised members it was a hard decision, and he was attempting to react to the point where he might have to defend the tax. He stated that if he had to defend the issue in a court of law, and HJR 18 was not adopted by the legislature, it would be used as evidence that the legislature did not really believe that it could dedicate the proceeds of a tax, adding that they were talking specifically about a tobacco tax in this case. MR. BALDWIN advised members that he was both in favor of the resolution, but somewhat nervous at the same time. Number 1645 CHAIRMAN GREEN asked if there was concern about either the ability to raise taxes, or to dedicate taxes. MR. BALDWIN advised members that immediately after statehood the question arose which was presented to the Attorney General and resulted in a formal opinion. The question was if the rate of a tax could be changed which was what all the tobacco bills were doing. The attorney general looked at the minutes of the Convention, and at that time they were not in writing, but on reel to reel tapes that were retrieved from archives. They listened to the tapes and attempted to piece together what happened. Mr. Baldwin noted that it had been suggested that he made a mistake when he did that, and it was concluded, from listening to one part of the debate that you could not change the rate of the tax. After the minutes were redeemed it appeared there was some discussion on the issue and during debate there were some assurances given by the chairman of the committee that they thought they could do that. MR. BALDWIN advised members that what happened during the interim was that the legislature, and the various administrations, acted consistent with the original advice; they believed that they could not change the rate of a tax and in fact enacted several bills, and particularly one in the area of tobacco tax. He stated that they took the device of creating a whole new section and assessing the tax under that section to make sure it was completely divorced from the original dedication. Mr. Baldwin advised members that there were 30 years of conduct where the state had been under the impression, and acted under that impression, that the rate of a tax could not be changed. He pointed out that there was a method of statutory construction called a long standing contemporaneous construction where you could make something so by just acting consistent with it. That was why the Attorney General's office was concerned about going back and picking out what was said in the Constitutional Convention and resting the eggs in that particular basket, because there had been a long standing, consistent conduct that the rate of tax could not be changed. MR. BALDWIN advised members that the corollary to that was if it clearly was wrong, the courts would not adopt it. Number 1794 CHAIRMAN GREEN stated then that there was a bias because of the 30 years of acting in a consistent manner, even though the intent may have been interpreted wrong. MR. BALDWIN advised members that was correct, and there was also the question of how much weight the Supreme Court would place on the debates. He advised members that they knew, from a lot of decisions over the course of the years, that the courts had looked to the debates and had cited to them when they support the conclusion that they reach. MR. BALDWIN expressed that on other occasions, the court had said those were just two citizens discussing something, and our intelligence exceeds that, and the court would go with what they thought was right. He pointed out that it was the same as the Attorney General's office cite to debates in the legislature all the time. Mr. Baldwin stated that it was certainly strong evidence that a tax rate could not be changed, and particularly because it came from the committee chairman, stronger than what would normally be found when sitting to just general debate and the courts have said they give more weight to what a committee chairman says. CHAIRMAN GREEN asked if it was the opinion of Mr. Baldwin that passing HJR 18 would correct those two real, or perceived ills. MR. BALDWIN felt it would certainly remove any doubt in whether the legislature could change the rate of a tax or not. He noted that it was up to the legislature to determine if that was good public policy or not. Number 1885 REPRESENTATIVE PORTER stated that for the record that may sometime in the future be looked at in the same way that the legislature and administration were reviewing the Constitutional Convention, he thought it was the general feeling of this legislature that the continuing interpretations of the legislatures were in error because of the recently discovered information about what appeared to be the clear intent of the constitutional framers, which was not available at the time the other interpretations were made. Representative Porter stated with that in mind, it was the position of the legislature that it was not necessary to pass HJR 18. Having said that, recognizing the Department of Law did that all the time, if a court should fail to adopt that interpretation, the legislature asserted HJR 18 as the solution to a problem that the legislature did not believe existed. REPRESENTATIVE JAMES advised members that in discussing the issue with the sponsor, it was determined that going to the people for a vote was cheaper than going to court. And if the legislature passed HJR 18 and it was put before the people and they voted yes, that by that time, if the tobacco tax passed, there would be an interim period where the decision would have to be made. Representative James stated that if a tobacco passed on October 1, 1997, what would happen between then and November 1998, if and when HJR 18 went to the people for a vote. She asked if anyone filed suit, would the Department of Law be able to put that suit on hold until the vote was taken in November, or would it likely be settled before November 1998, pointing out that the timing was her question. Representative James advised members that she saw that as a cheaper means to determine the answer to the dilemma they found themselves in. MR. BALDWIN advised members that he first thought the people would jump out right away and get the state into litigation as quickly as they could; however, the department had become very adept over the years of channeling people through the right process. The right process, in this case, would be to make them file for their tax and then protest it, and then take it through the administrative process. Once through the administrative process, it would be appealed to the superior court, so they could be looking at a period of time in excess of possibly two years before the first court would rule on the questions of law. Mr. Baldwin stated that the time between October 1997, and the November election, and then the 90, or 45 days after that when the constitutional amendment took effect, he could see that the litigation could be moving along but not resolved by the time a vote was had on the matter. REPRESENTATIVE JAMES expressed that she was assuming that the case Mr. Baldwin was talking about would be a case against the tax, period. MR. BALDWIN agreed. REPRESENTATIVE JAMES stated that if the case was on the dedication, would not the fact that the legislature was asking for a vote of the people have some bearing on that case. MR. BALDWIN felt that what the court would allege was that the legislature was totally without power to enact a tobacco tax with the increase being dedicated. The courts would say that the legislature lacked power to do that because the Constitution prohibited it and, therefore, they would get to the tax in that fashion. Mr. Baldwin stated that then, he would assume the department could come in and say, look, there was going to be a vote on the issue and the whole thing could be mooted out within a reasonable time, and let's wait and see whether the case is mooted out. Mr. Baldwin advised members that a court might buy that. He pointed out that the courts were reluctant to give what were known as advisory opinions, and if they thought that the people might moot the thing out by a vote on a constitutional amendment, they might regard anything they do as being an advisory opinion, and they would escape having to decide the question. REPRESENTATIVE JAMES stated that in the tobacco tax bill, HB 1, that was currently in the House Rules Committee, there was the backup provision that if it was determined to be unconstitutional, it would just go into the general fund. She asked if that would not be an answer for anyone who should sue under the dedication. It seemed to her that it was a situation of the "cart before the horse", and she thought the state was protected in the bill itself. MR. BALDWIN advised members that he thought that the bill, itself, acted as a disincentive to sue, at least on the dedicated fund issue, in that it did not get them very far unless they were thinking of a larger strategy of returning to the legislature with some other approach, and using the bill as a device to do that. He advised members that the state also had public interest litigant legal fees, where a law firm could bring a law suit against the state, and if it was perceived to be a public interest litigation, they could get full fees, so all incentives had not been removed to litigate the issue. Mr. Baldwin pointed out that he had considered that and did not feel they were home free with the backup. He advised members that the department had been following the bill and those were the sections they had been zeroing in on because that was where the department thought it would ultimately end up, that the state would be in the backup situation. Mr. Baldwin expressed that they could be wrong; legislative legal could be right, and the Department of Law might be wrong. Number 2190 CHAIRMAN GREEN stated that if both bills passed muster, and the tax was in progress while HJR 18 would have to wait a year, would that have and adverse effect, or at least an impact on the decision. MR. BALDWIN advised members that it may be that a court would say the legislature had gone forward to amend the Constitution and they did not really believe, but it was hard to figure out how all that would come to play. He stated that the department kept saying that you could not draw any evidentiary value out of the fact that the legislature did not pass something; however, he had been in many cases where people on the other side had tried to, so there were pluses and minuses to HJR 18. REPRESENTATIVE BUNDE stated that it was his understanding the legislative legal opinion was correct, that the legislature did have the right to change the amount of a tax, and that the past legislatures had made their decisions on incorrect information. Representative Bunde felt this legislature had better information and they were making decisions based on that. REPRESENTATIVE BUNDE stated that he did not want to confuse the process and cause more litigation, and pointed out that Mr. Baldwin stated that the fact that the legislature even looked at the issue might be brought into play in a suit, and asked at what point a bill represented the will of the legislature; after it passed one committee, two committees, one house? Number 2307 MR. BALDWIN stated that generally, the fact that the legislature did not pass something, was not supposed to be considered as evidence of anything. However, often times legislation is viewed as a package, a whole area that was being considered by the legislature at any given time, and people could look for intent, or what ever happened where ever they could find it. He stated that one would look to anything that had to do with tobacco, for example, and this legislature tried to understand the meaning of whatever it was that was passed. Mr. Baldwin advised members that the court had said that it would not be inflexible in its manner of interpreting statutes, that the court rejected what was known as the "plain meaning rule." He explained that the courts look to the history of bills to understand what the legislature's meaning and intention was, and had said it would look anywhere that had credible history of what the legislature meant. Mr. Baldwin did not feel the court would feel restricted to just looking to the hearings on HB 1, or SB 13. He pointed out that the court might feel it could look to what the House Judiciary Committee had said about HJR 18. MR. BALDWIN stated that as to what the law meant, the court would not look much beyond itself, because its held unto itself the ability to interpret and understand what the law meant and what the constitution meant. He noted that during a couple legislatures ago, they had tried to interpret the constitution for the court, and the court served that back very quickly saying, "We'll tell you what the constitution means", and that dealt with the Constitutional Budget Reserve Fund case. Mr. Baldwin expressed that at the end of the day, the court would rely on its own device; would not take the opinion of the Attorney General's office or Legislative Legal. Number 2400 REPRESENTATIVE CROFT stated that it was hard enough to figure out what the legislature meant when they did something, and he would say it would be virtually impossible to figure out what they meant by not doing something. He joined Representative Porter's comments, and stated that it seemed to him that the newly found notes of the Constitutional Convention could not be clearer. He advised members he had never seen a better "smoking gun" on an issue of legislative or constitutional intent. However, it was his feeling, as with Representative Porter, that this legislature thought that was the proper interpretation, and did not mean, by HJR 18, to cast doubt on it, or if the resolution got hung up somewhere along the complicated process, that that would change anyway. He pointed out that things get hung up for a myriad of reasons rarely related to their merits. REPRESENTATIVE BERKOWITZ stated that so future people who would be interpreting what was going on that he also wanted to join with the comments of Representative Porter, clearly, without equivocation. CHAIRMAN GREEN expressed his support of those comments also. Number 2469 CHAIRMAN GREEN invited Jim Elkins of Ketchikan to address the committee via teleconference. TAPE 97-54, SIDE B Number 0000 JIM ELKINS advised members that he was surprised that a republican legislature would come forward and consider levying any kind of consumer tax on the citizens of Alaska. He felt that legislators were elected to make decisions, some of them tough and some of them easy. Mr. Elkins stated that he did not believe legislators were elected to make the voters in the state make tough decisions, which was his personal opinion. MR. ELKINS stated that on April 4, 1997, the Ketchikan Gateway Borough passed Resolution No. 1331, which basically opposed any taxation enactment that was not applied equally to all tax payers in the state of Alaska, and that had been forwarded to the Municipal League and the Ketchikan state representatives. Number 054 REPRESENTATIVE JAMES referred to the resolution mentioned by Mr. Elkins that talked to not applying any taxes that were not equal across the state and asked if he was saying that a tax had to be equal, or the money spent equally across the state through an increase of a tax. MR. ELKINS advised members they were talking about taxing all things equal. REPRESENTATIVE ROKEBERG, for the purpose of clarification, asked if Mr. Elkins was talking about HB 132, or HJR 18. MR. ELKINS stated that he was speaking to the resolution before members which dealt with the tobacco tax and whether it should be put before the voters with regard to the dedication of those funds. He added that he might be wrong about what the resolution stood for; however, he felt it was the responsibility of the legislature to make the decision, up or down, but, personally opposed any kind of a consumer tax. REPRESENTATIVE BUNDE noted that Mr. Elkins had stated that taxes should be applied equally, and asked if that meant that people who did not drive should be required to pay a motor fuel tax. REPRESENTATIVE BUNDE asked if Mr. Elkins was in any way employed by the tobacco industry. MR. ELKINS advised members he was not, and pointed out that he was a non-smoker. REPRESENTATIVE JAMES asked if the only dedicated fund currently in place was the Fish and Game fund. MR. BALDWIN stated that there was a Fisherman's Fund. REPRESENTATIVE JAMES asked if the Public School Trust Fund was a dedicated fund. REPRESENTATIVE BUNDE said it was Fish and Game, and Mr. Baldwin agreed. REPRESENTATIVE JAMES asked what the source of revenue was for those funds. MR. BALDWIN advised members that the Fish and Game fund was a percentage of licenses, and he believed the Fishermen's Fund involved a percentage of crew member licenses. He pointed out that there was kind of a difficulty in definition there, but the school land trust was switched to a fund in 1978, which was a dedicated fund that received half of 1 percent of revenues generated from state lands. Mr. Baldwin advised members that the Second Injury Fund was created by statute that he believed was required by federal law and had to do with workers compensation, and was funded by part of the tax from workers compensation. MR. BALDWIN advised members that there were a lot of funds that could be considered as being dedicated, but were not dedicated in the sense that the constitution was concerned, although there were only one or two pre-statehood dedicated funds. REPRESENTATIVE JAMES asked how many other funds would be affected by HJR 18. MR. BALDWIN believed the Fish and Game Fund was either required by federal law, or pre-statehood and qualified under both criteria. The Fishermen's Fund was a pre-statehood fund, and after that it got pretty few and far between. He advised members that the Public School Trust Fund, which was created in 1978, was land prior to that date, and the department considered that to be one required by federal law. Mr. Baldwin thought there were only two, three at the most, that were pre 1956. REPRESENTATIVE JAMES stated that if HJR 18 passed and the ballot reflected voter approval, it was her understanding that they could change the revenue percentage of the licenses that go into the Fishermen's Fund without destroying the fund. MR. BALDWIN advised members that had been debated over the years and there were opinions regarding that on the books. He stated that the legislature, in the past, had decided not to change the rate of that dedication by relying on the 1959 opinion that believed that could not be done. REPRESENTATIVE JAMES asked Mr. Baldwin if he recalled when the state lost the highway tax, which she assumed was because the state had raised the tax. MR. BALDWIN thought that was what the 1959 opinion was directed towards and the legislature changed that tax in response to that opinion, and decided they would go another route and it all, then, went to the general fund. He believed that was the history of where that 1959 opinion got started and the ultimate result. Number 288 CHAIRMAN GREEN asked if a permit fee or a use fee, for all practical purposes, was a tax, and asked Mr. Baldwin to explain the difference. MR. BALDWIN advised members that the term used in the State Constitution was "state tax or license", but stated that the real answer to Chairman Green's question was that he did not know. REPRESENTATIVE PORTER stated that in light of the new information, why was a new attorney general's opinion not issued that would override the previous one so it would not be an issue. MR. BALDWIN advised members that the department was asked to review the question they were asked, and in preface to his answer, stated that he would have to say that he thought the position taken by the legislature and their attorneys was a good faith legal position, and he would not have any difficulty defending it in court. But the Attorney General's office looked at it, and considering the factors he had mentioned earlier today in his testimony, he felt that the better legal position was that 30 years of consistent conduct on the part of the legislature was pretty strong evidence. Mr. Baldwin stated that it would be hard to stand up in court and say that everything had changed now, that statements made by people during the Constitution Convention had been found that changed everything somehow. Mr. Baldwin expressed that things in the law did not switch around that fast, in the view of the Department of Law, so the Attorney General's office decided to stick with the 1959 decision, and pointed out that stare decisis meant a lot. He expressed to members that the Attorney General's office had advised the governor that the safest course would be for him to create a Sonneman v. Knight vehicle-type fund, which the Senate had described in their hearings recently as "the white picket fence" approach. REPRESENTATIVE PORTER asked if there had never been an inconsistent attorney general's opinion. MR. BALDWIN advised members that he had been around for more than one administration and had found in subsequent administrations that he had sometimes had to digest opinions that he had written in earlier administrations, and asked if that was what Representative Porter was getting at. REPRESENTATIVE PORTER stated that he recognized that stare decisis meant something, but it should not mean something in the face of clear evidence to the contrary; that stare decisis falls just because social mores have fallen over the history of time. Representative Porter stated that what was being debated was a clear mistake of fact. MR. BALDWIN stated that he was not there to get into a debate about who was right, or who was wrong. He reiterated that the position taken by the legislature was one he felt could be defended in good faith and that he thought it had some merit. Mr. Baldwin expressed that he did not want to get into a position where he would say that "you're wrong and we're right", because the court would make that decision and the Department of Law would definitely be involved with defending the case and would be using the best of its abilities to defend the case. CHAIRMAN GREEN stated that when the Department of Law finds evidence contrary to a long standing practice and stay silent, if that was fulfilling the obligation of the office to not bring that evidence forward. MR. BALDWIN advised members he believed the Attorney General's office had to provide the best opinion as to how they thought the law should be interpreted. He expressed to members that to say the information had "just" been discovered was not truly accurate because members could find history included in Attorney General opinions going back a number of years that they had been aware that the history existed in the minutes. Mr. Baldwin pointed out that the writers of those opinions said they felt the original interpretation still had merit, and he stated that he felt it had been with eyes open that the department adhered to the earlier opinion. Mr. Baldwin stated that he did not believe they had breached any ethical obligations to the legislature or the governor, but just called it the way they had seen it. CHAIRMAN GREEN asked if the prior opinions had acknowledged the new information of the Constitutional Convention. MR. BALDWIN advised members he would provide the opinion; however, basically, it just acknowledged that there was discussion to the contrary during the convention. He felt members were well aware that discussion at the State Constitutional Convention was a lot like what occurs in the legislature; i.e, debate on the floor where any number of opinions were expressed by people who may, or may not have a good understanding. Mr. Baldwin stated that now, to seize upon some evidence that you find favorable was one of the factors to consider when interpreting a statute, or the constitution, and the Attorney General's office was saying that all the other things needed to be considered as well, like the long standing contemporaneous construction, the words of the constitution, and what the people thought. He advised members there were several things that a person has to look at when you construe the Constitution, and he thought it was a little dangerous to say; "Well, in the minutes of the Constitution this was said and we liked what was said, and that should carry the day", was not the case. Mr. Baldwin explained that when the court looks at it, they would look at the wording of the Constitution, the dictionary to see how people would understand those words, and look at what the people were told at the time the Constitution was construed, and then they apply common sense to all of those things and arrive at an interpretation of it. Mr. Baldwin stated that to look at just the minutes of the Constitutional Convention was not looking at the whole picture for how to construe it. MR. BALDWIN stated that taking all that together, the construction could be the other way and he did not want to sit there and create evidence against the state's case. He stated that if the tax was enacted, he wanted to point out to the committee all the legal considerations that were there and that they understood them fully, and hoped members did not have bad feelings about the Attorney General's office, because he was there to defend what they had done and he believed they had done it right. Mr. Baldwin expressed that they just wanted to bring another objective view point about how the constitution might well be interpreted. Number 655 REPRESENTATIVE BERKOWITZ wanted to make sure that the committee would not ascribe too much importance to attorney general opinions because, with all deference to the Attorney General's office, they did not carry much precedential weight in the courts. He stated that in essence, they were maybe one small notch above the legal conclusions reached by a private law firm in its own brief, and while they might help guide the state's conduct, the judiciary did not spend much time viewing them for their merits. REPRESENTATIVE PORTER stated that the only difference was, which he was sure that Representative Berkowitz was aware, that, unfortunately, an A.G.'s opinion was law until it was overturned by a court and was looked at as law until that happened, so what they were debating could be fixed quicker. Number 693 REPRESENTATIVE ROKEBERG brought to the committee's attention the fact that during his study of the bill relating to the statehood compact, that there was an Attorney General's Opinion Number Six that the attorney general denied even existed, so there were some strange permutations that revolve around attorney general opinions. REPRESENTATIVE CROFT pointed out that included in members bill files was a list of seven dedicated funds that had been submitted by Representative Ivan. He stated that whatever happened with HJR 18, there was some possibility that those funds would be in the same boat, either because the lands, in some cases, or subject was pre-statehood or the enactment of the fund was pre-statehood. MR. BALDWIN had the list in front of him and stated that the list that was provided to the House State Affairs Committee was a little bit longer, and he felt the list had been pared down some. Mr. Baldwin advised members that the U of A Trust Fund was the university's land and came from the management of the lands, was required by federal law and was also pre-statehood. Mr. Baldwin advised members that he was not familiar with the FICA Administration Fund and had not considered it to be a dedicated fund, although had thought of it as a trust fund where revenues were earmarked that come into it. The Fish and Game Fund was pre- statehood and required by federal law. Mr. Baldwin advised members that the School Fund was funded by tobacco tax revenues and the Sick and Disabled Fishermen's Fund was a pre-statehood fund. Mr. Baldwin advised members that he was a little uncertain about the Second Injury Fund as it may be just statutory, but if it was good at all, it was probably required by federal law. Mr. Baldwin advised members that the Public School Trust Fund was a strange fund that was changed in 1978 that was land before and now a dedicated trust fund. MR. BALDWIN stated that of all of those, he thought the Sick and Disabled Fishermen's Fund was probably the one pre-statehood that would be like HJR 18, with 60 percent of crew licenses funding it. Mr. Baldwin reiterated that the FICA Administration Fund was the only one he could not be sure on; however, the rest of them did not seem to fit the category. Number 818 REPRESENTATIVE CROFT stated that those were either dedicated or not, appropriately, as a grandfather from pre-statehood, and to the extent that the list represented a good list of grandfathered dedicated funds, that the same logic of changing the rate would apply to the 60 percent of crew licenses, to half of 1 percent of state land management, and asked if his summation was correct. MR. BALDWIN stated that Representative Croft was correct, except that the half of 1 percent to the Public School Land Trust was established after statehood, reiterating that it was a strange one. He believed that the funds preceding statehood would be the Fishermen's Fund and maybe the Second Injury Fund. REPRESENTATIVE ROKEBERG thought the Second Injury Fund was a pooling of monies from workers comp, like a re-insurance funded pool; however, it did exist before statehood. REPRESENTATIVE PORTER moved to report CS HJR 18(STA) out of committee with individual recommendations and attached fiscal notes. There being no objection, CS HJR 18(STA) was reported out of committee.
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