Legislature(2021 - 2022)GRUENBERG 120
02/15/2022 03:00 PM House STATE AFFAIRS
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Audio | Topic |
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Start | |
HB158 | |
HB245 | |
HB234 | |
Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
+= | HB 158 | TELECONFERENCED | |
+= | HB 234 | TELECONFERENCED | |
+= | HB 245 | TELECONFERENCED | |
+ | TELECONFERENCED | ||
HB 158-PFD CONTRIBUTIONS TO GENERAL FUND 3:09:34 PM CHAIR KREISS-TOMKINS announced that the first order of business would be HOUSE BILL NO. 158, "An Act relating to contributions from permanent fund dividends to the general fund." 3:09:48 PM CHAIR KREISS-TOMKINS opened public testimony on HB 158. 3:10:15 PM ED MARTIN stated that the Permanent Fund Dividend (PFD) had been a success for Alaska over the years. He referenced the ability to donate a portion of the dividend to charities via Pick.Click.Give, adding that he had no qualms with that option. He expressed concern that [HB 158] was just one more avenue down the digital currency movement across the world. Further, he found it troublesome that, as stated in the sponsor statement, donations through Pick.Click.Give. would take priority over donations to the general fund. He noted that he was not directly opposed to the bill, as he supported anyone who wanted to give money back to the state. In summary, he said he questioned the legislation because, according to the fiscal note, the bill would take money from the people thats really theres. 3:13:43 PM CHAIR KREISS-TOMKINS [closed public testimony] and proceeded to the consideration of amendments. 3:14:04 PM REPRESENTATIVE EASTMAN moved to adopt Amendment 1, labeled 32- LS0746\A.1, Nauman, 2/14/22, which read as follows: Page 1, line 13, through page 2, line 1: Delete "The electronic application must include notice that seven percent of the money contributed to the state general fund will be used for administrative costs incurred in implementing this subsection and that money from the dividend fund will not be used for that purpose." Page 2, following line 8: Insert a new subsection to read: "(d) Money contributed to the state general fund under this section may not be used for administrative costs incurred in implementing this section." REPRESENTATIVE CLAMAN objected. REPRESENTATIVE EASTMAN explained that Amendment 1 would remove the seven percent fee that was imposed to cover the administrative costs incurred in implementing the legislation. He reasoned that if someone chose to donate a portion of his/her dividend to the general fund, that money would essentially be staying in the states coffers; therefore, there should not be an administrative cost associated with that transaction. 3:15:26 PM REPRESENTATIVE TARR inquired about the seven percent fee and asked whether Representative Eastmans assumption that there would not be an administrative cost was correct. 3:16:21 PM COREY BIGELOW, PFD Operations Manager, Permanent Fund Dividend Division, Department of Revenue (DOR), clarified that there would be an administrative cost for an Alaskan who elected to contribute his/her dividend to the general fund, as that request would need to be processed on some level. He added that at this time, he was not able to convey a monetary value associated with those tasks. REPRESENTATIVE TARR suggested that if Amendment 1 were adopted, any additional workload brought on by the bill would need to be absorbed by existing staff. She said she was weary of the proposed amendment without having a better understanding of the divisions internal capacity. MR. BIGELOW shared his belief that the workload could be handled by current staff; however, if a large number of people elected to contribute their dividends, the administrative costs could be higher. He added that without knowing how many individuals intended to contribute, it was difficult to provide a definitive number. REPRESENTATIVE TARR inquired about the divisions position on Amendment 1. MR. BIGELOW indicated that the division was neutral in its stance on HB 158. REPRESENTATIVE EASTMAN asked how many people at present had elected to give money back to the state. 3:20:49 PM REPRESENTATIVE MIKE PRAX, Alaska State Legislature, prime sponsor, reported that last year [2021], 105 people returned their PFD to the state. 3:21:10 PM REPRESENTATIVE CLAMAN shared his understanding that if he were to give $100 to the Foodbank via Pick.Click.Give, there would be a $7 processing fee associated with that transaction. He sought to confirm that under that scenario, the Foodbank would receive $93, and the division would receive $7 to cover the administrative costs. MR. BIGELOW explained that the donation of $100 would go to the Alaska Community Foundation, which is the organization that administers the [Pick.Click.Give] program. He confirmed that of the $100, [the Alaska Community Foundation] would receive 7 percent of it, or $7. REPRESENTATIVE CLAMAN sought to confirm that if an individual gave $100 back to the general fund, to the extent that there were administrative costs, Amendment 1 would require that the cost incurred be funded from another source. MR. BIGELOW said that was his understanding as well. 3:23:27 PM REPRESENTATIVE VANCE shared her understanding that as it stands, the Alaska Community Foundation received the 7 percent fee, as opposed to the Permanent Fund Dividend Division. She opined that Amendment 1 would encourage more people to give back to the state without having to pay for it. CHAIR KREISS-TOMKINS invited closing comments on Amendment 1. 3:25:16 PM REPRESENTATIVE CLAMAN reiterated his opposition to the proposed amendment, as it would prohibit the administrative cost from being recovered from the money contributed. He maintained that his fundamental concern with HB 158 was that to exercise this privilege, the individuals who donated would still have to pay 20 percent in taxes to the federal government. He opined that if the legislature was serious about getting more money in the general fund, the proposed legislation was a terrible way to do it. REPRESENTATIVE EASTMAN stated that Amendment 1 was offered because the Alaska Community Foundation [wasnt] give the money to anyone. He opined that to tax the transactions at 7 percent seemed unnecessary. REPRESENTATIVE CLAMAN maintained his objection. 3:27:27 PM A roll call vote was taken. Representatives Vance, Kaufman, and Eastman voted in favor of the adoption of Amendment 1. Representatives Tarr, Story, Claman, and Kreiss-Tomkins voted against it. Therefore, Amendment 1 failed by a vote of 3-4. 3:28:25 PM REPRESENTATIVE CLAMAN moved to report HB 158 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 158 was moved out of the House State Affairs Standing Committee.