Legislature(2021 - 2022)
04/29/2021 04:02 PM STA
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* first hearing in first committee of referral
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HB 142-PFD ELIGIBILITY 4:07:13 PM CHAIR KREISS-TOMKINS announced that the next order of business would be HOUSE BILL NO. 142, "An Act relating to eligibility for the permanent fund dividend." [Before the committee was CSHB 142(JUD).] 4:07:34 PM REPRESENTATIVE KEN MCCARTY, Alaska State Legislature, introduced HB 142, as the prime sponsor. He explained that the proposed legislation would limit the Permanent Fund Dividend (PFD) eligibility of active-duty military members to those who were physically stationed in Alaska. CHAIR KREISS-TOMKINS invited questions from the committee. 4:08:54 PM REPRESENTATIVE EASTMAN asked whether the bill would impact the eligibility of congressional staff who had left the state and were living and working in Washington D.C. REPRESENTATIVE MCCARTY indicated that congressional members, members of the Peace Corps, and full-time students who were still Alaska residents would still be eligible to receive the PFD. REPRESENTATIVE EASTMAN asked whether the proposed legislation would impact an Alaska resident who was stationed abroad for some period of time and had family residing in state. REPRESENTATIVE MCCARTY relayed that a military member who was deployed would not lose PFD eligibility if his/her base remained in Alaska. REPRESENTATIVE EASTMAN asked whether someone who was deployed overseas would lose eligibility. REPRESENTATIVE MCCARTY was unsure of the answer. 4:12:05 PM REPRESENTATIVE KAUFMAN questioned why the bill was focused solely on the military, as opposed to having a broader scope. REPRESENTATIVE MCCARTY reported that last year, $16 million was distributed to individuals who no longer lived in state. He indicated that the intent was to reduce the amount of PFD dollars sent to people who no longer resided in Alaska. REPRESENTATIVE KAUFMAN cited the sponsor statement, which specified that in 2018, $4,900,000 had been distributed to service members who spent more than 180 days out of state. He inquired about the discrepancy between $16 million and $4,900,000. REPRESENTATIVE MCCARTY stated that the $4.9 million applied to active-duty military members only, whereas the $16 million was distributed to military members, as well as their significant others and dependents. 4:14:33 PM REPRESENTATIVE STORY sought to clarify when a service member would become ineligible under the proposed legislation. She pointed out that some military members were serving out of state with the intent of returning to Alaska. She asked whether those people would lose their eligibility. REPRESENTATIVE MCCARTY indicated that those individuals would lose eligibility. He explained that many people who intended to return to Alaska never did. He said if and when those military members return to Alaska, they could regain their PFD eligibility. 4:16:13 PM REPRESENTATIVE EASTMAN, referencing a letter from the Department of Revenue (DOR) [hard copy included in the committee packet], asked Representative McCarty to quantify the forecasted increase in eligibility for individuals not serving in the military. REPRESENTATIVE MCCARTY offered to follow up with the requested information. REPRESENTATIVE EASTMAN pointed out that the document from DOR suggested that paid dividends would be reduced by approximately $8.5 million if the bill were to pass. He contended that less money wouldn't be disbursed, it would just be distributed to different people. He asked if that was correct. REPRESENTATIVE MCCARTY shared his understanding that the existing money would be divided accordingly to "the number allocated out for the state in that year." CHAIR KREISS-TOMKINS explained that if there was a finite amount of money going towards dividends and the denominator of eligible Alaskans grew smaller, then each remaining Alaskan would receive an incrementally larger dividend. 4:18:44 PM REPRESENTATIVE TARR sought to clarify the concept of reestablishing residency for a service member who had left Alaska and subsequently returned. She asked whether someone who had previously established residency in Alaska would be "situated differently" than someone who was new to Alaska. REPRESENTATIVE MCCARTY said anyone who returned to the state or moved to the state would be considered in an equitable manner. He indicated that it would create too much of a? "quagmire" to differentiate between the two. 4:21:53 PM REPRESENTATIVE STORY asked how many appeals had been submitted against the denial of an individual's PFD eligibility, as well as why certain appeals were awarded. She expressed concern about taking away PFD eligibility from military members. REPRESENTATIVE MCCARTY recalled his conversation with two generals who indicated that there was a lot of incentive to move to Alaska for service members; further, that the proposed legislation shouldn't deter that. He expressed concern about the significant resources that were invested in the investigations into applicants' intention of returning to the state after a permanent change of station (PCS). 4:24:08 PM CHAIR KREISS-TOMKINS asked how many PCNs were in the investigation section in the Permanent Fund Dividend Division. 4:24:32 PM REPRESENTATIVE EASTMAN asked whether it would be beneficial to discourage snowbirds from renting out their in-state residences, as it could be perceived as a business. REPRESENTATIVE MCCARTY stated that snowbirds were required to return to the state within 180 days or else they lose their PFD eligibility. Alternatively, military members could be deployed over 180 days for purposes of deployment and still be considered residents. REPRESENTATIVE EASTMAN asked DOR how much time would be spent verifying people's intent to return to Alaska. REPRESENTATIVE KREISS-TOMKINS agreed. He noted that these questions would be addressed in the next bill hearing. REPRESENTATIVE EASTMAN questioned whether the repeal of the allowable absence eligibility criteria, which required DOR to consider relevant factors of intent, would impact individuals outside of the military. REPRESENTATIVE MCCARTY deferred the question to the Permanent Fund Dividend Division. 4:27:41 PM REPRESENTATIVE TARR recalled previous legislation that had proposed placing dividends in an account for [service members] who left the state with the intent to return in the future. She explained that if those individuals returned to Alaska, they would then be eligible to collect those PFDs. She asked whether that concept had been considered by the bill sponsor. REPRESENTATIVE MCCARTY replied that it had been considered. 4:29:00 PM CHAIR KREISS-TOMKINS asked whether the bill sponsor had considered amending any of the allowable absences in the drafting of the proposed legislation. REPRESENTATIVE MCCARTY said he had considered making an allowance for the commercial aviation industry but ultimately decided against it, as other industries would have requested equitable treatment. 4:30:36 PM REPRESENTATIVE VANCE inquired about the language "is absent" on page 2, line 1, of CSHB 142(JUD), which was changed from "was absent". She asked whether the change of tense was made by the bill sponsor or Legislative Legal Services. REPRESENTATIVE MCCARTY deferred the question to Legislative Legal Services. 4:32:04 PM CHAIR KREISS-TOMKINS announced that HB 142 was held over.