05/04/2007 03:00 PM House LABOR & COMMERCE

HJR 16-OPPOSING MILK TAX                                                                                                      
                                                                                                                                
3:36:35 PM                                                                                                                    
                                                                                                                                
CHAIR OLSON  announced that the  next order of business  would be                                                               
HOUSE JOINT RESOLUTION NO. 16,  Opposing imposition of a milk tax                                                               
on Alaskans.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BOB LYNN,  Alaska State  Legislature, sponsor  of                                                               
HJR 16, began  by thanking the committee for hearing  HJR 16.  He                                                               
informed  the committee  that HJR  16 is  similar to  legislation                                                               
that was introduced and heard  [last session] but became stuck at                                                               
the end of the session.                                                                                                         
                                                                                                                                
3:37:37 PM                                                                                                                    
                                                                                                                                
DIRK  MOFFATT, Staff  to Representative  Bob  Lynn, Alaska  State                                                               
Legislature, explained that  HJR 16 is a  resolution opposing the                                                               
milk tax,  which is the  "Mandatory Dairy  Promotion Assessment".                                                               
The milk  tax was imposed on  milk producers in 1983  to decrease                                                               
milk  surplus  by increasing  demand.    However, Alaska  doesn't                                                               
produce enough milk  to meet its demands.   Therefore, Alaska was                                                               
excluded from the milk tax.   Nothing has changed since 1983, and                                                               
therefore Alaska  shouldn't be forced to  promote outside surplus                                                               
milk from the  Lower 48.  Mr. Moffatt then  drew attention to the                                                               
letter in opposition to the  milk tax from Alaska's congressional                                                               
delegation to  the U.S.  Secretary of  Agriculture.   Mr. Moffatt                                                               
requested the committee oppose the milk  tax and pass HJR 16 from                                                               
committee.                                                                                                                      
                                                                                                                                
3:39:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GATTO inquired  as to the percentage  of milk that                                                               
is imported.                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER answered about half.                                                                                     
                                                                                                                                
MR. MOFFATT deferred to Mr. Castillo.                                                                                           
                                                                                                                                
3:40:14 PM                                                                                                                    
                                                                                                                                
MARIO CASTILLO,  Executive Director,  The Dairy  Trade Coalition,                                                               
explained  that  The  Dairy  Trade   Coalition  is  comprised  of                                                               
consumers  and  agricultural  business interests  throughout  the                                                               
U.S.   The organization has  affiliates in Alaska,  including the                                                               
Alaska  chapter  of Women  Involved  in  Farm Economics  and  the                                                               
Alaska  Milk Coalition.   In  response to  Representative Gatto's                                                               
question, Mr. Castillo offered to  get the specific percentage of                                                               
milk  imported into  Alaska versus  how much  is produced  in the                                                               
state.                                                                                                                          
                                                                                                                                
3:43:07 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GATTO  related his understanding that  the purpose                                                               
of the  milk tax was to  increase the sale of  milk by supporting                                                               
an  advertising  campaign.   However,  Alaska  doesn't  need  the                                                               
advertising  [as  there  is  no   surplus  of  milk  in  Alaska].                                                               
Representative Gatto  opined that  not paying the  milk tax  is a                                                               
good idea.                                                                                                                      
                                                                                                                                
3:43:56 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LEDOUX  moved to  report HJR  16 out  of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes.  There being no objection, it was so ordered.                                                                            
                                                                                                                                
The committee took an at-ease from 3:44 p.m. to 3:47 p.m.