Legislature(2001 - 2002)

03/28/2001 01:37 PM CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                                                                                                                                
          HB 118-SR CIT./DISABLED VET. PROP TAX EXEMPTION                                                                   
                                                                                                                              
Lori Backes, staff  to Representative Whittaker introduced  the bill                                                            
and explained  that HB  118 allows municipalities  to establish,  by                                                            
their  own ordinance,  methods for  accepting  applications for  the                                                            
senior citizen, disabled  veterans, and widows and widowers property                                                            
tax exemption.  Under current  state law,  these citizens must  file                                                            
yearly for  this exemption and Representative  Whittaker  thought it                                                            
was  best  that  communities  establish  their  own  procedures  for                                                            
accepting these applications.  For example, he thought it was unfair                                                            
that seniors had to apply  yearly for the exemption when the general                                                            
residential  property  tax exemption  could be  made on  a one  time                                                            
basis.                                                                                                                          
                                                                                                                                
SENATOR PHILLIPS asked  if he was correct that, at the local option,                                                            
a senior  citizen would have  to file just  once for a property  tax                                                            
exemption.                                                                                                                      
                                                                                                                                
MS.  BACKES said  that  is correct  if  that is  the  choice of  the                                                            
municipality.                                                                                                                   
                                                                                                                                
SENATOR  PHILLIPS asked  how  the municipality  would  check to  see                                                            
whether the  seniors had  moved and their  non-senior children  were                                                            
now occupying the house.                                                                                                        
                                                                                                                                
MS.  BACKES  said  that  would  be  addressed   the  same  way  that                                                            
municipalities currently  address that situation; the house would no                                                            
longer qualify for the exemption.                                                                                               
                                                                                                                                
SENATOR PHILLIPS thought  he was missing some point; registering for                                                            
the exemption just once could invite fraud.                                                                                     
                                                                                                                                
MS. BACKES said that municipalities  could set their own methods for                                                            
checking that the exemptions  were allowable. One suggestion is that                                                            
a reminder or  question card could be sent on a yearly  basis asking                                                            
whether  the individual  still lives  at the same  location.  If the                                                            
card isn't sent back, that residence should be checked.                                                                         
                                                                                                                                
SENATOR PHILLIPS thought that people would cheat.                                                                               
                                                                                                                                
CHAIRMAN  TORGERSON   asked  Steve  Van  Sant  to  address   Senator                                                            
Phillips' concerns.                                                                                                             
                                                                                                                                
STEVE VAN SANT,  local assessor for the Department  of Community and                                                            
Economic  Development, responded  that they  have this problem  now.                                                            
There is a small percentage  of senior citizens throughout the state                                                            
who sign that  they live at a particular residence  when they really                                                            
don't live there.  There is a safeguard that the local  municipality                                                            
can  put  in whereby  certain  requirements   must be  met  and  the                                                            
assessors expect  that those procedures would be written  in so that                                                            
they would  be able to check  if there was  a question. There  is no                                                            
perfect solution, however.                                                                                                      
                                                                                                                                
SENATOR  PHILLIPS asked  whether it  would be  mandatory to  include                                                            
procedures for checking or not.                                                                                                 
                                                                                                                                
MR. VAN  SANT said  the bill  says, "…shall  by ordinance  establish                                                            
procedures."   Within  those   procedures   each  municipality   has                                                            
latitude.                                                                                                                       
                                                                                                                                
SENATOR PHILLIPS said this is non-mandatory.                                                                                    
                                                                                                                                
MR. VAN SANT agreed.                                                                                                            
                                                                                                                                
CHAIRMAN  TORGERSON asked  whether assessors  generally support  the                                                            
bill.                                                                                                                           
                                                                                                                                
MR. VAN SANT  said they do generally  but the one concern  they have                                                            
is on  page  1, line  14 where  "for that  year" is  removed. If  an                                                            
individual  asks for  an exemption  to  be retroactive  for  several                                                            
years there  would be no way for the  assessor to go back  and check                                                            
whether they met criteria for the exemption.                                                                                    
                                                                                                                                
CHAIRMAN TORGERSON  asked for confirmation  that removing  "for that                                                            
year" might make this retroactive.                                                                                              
                                                                                                                                
MR.  VAN  SANT said  he  believed  it  would. To  this  point,  that                                                            
language  has been used  to mean  that the governing  body may  only                                                            
waive an  application  late file for  that year  only. It cannot  be                                                            
retroactive.                                                                                                                    
                                                                                                                                
MS. BACKES responded that  it hinges upon the word "may" in line 13.                                                            
"The governing  body of the  municipality for  good cause shown  may                                                            
waive…"  It would be  a borough  or municipal  assembly decision  to                                                            
waive the  application or  not waive it.  This allows the  applicant                                                            
the  opportunity  to appeal  the  decision.  Without the  change  in                                                            
language,  local  municipalities  can  only  address  that  type  of                                                            
situation during that current application year.                                                                                 
                                                                                                                                
SENATOR LINCOLN  spoke about a woman from Fairbanks  who was ill and                                                            
didn't realize  that she had to request  a waiver. The borough  said                                                            
its hands were tied because  they weren't allowed to waive that year                                                            
or prior years.                                                                                                                 
                                                                                                                                
MS. BACKES was  familiar with the case and said that  she wasn't ill                                                            
but illiterate and didn't  know that she had to file more than once.                                                            
By the time the  borough noticed the problem, she  was many years in                                                            
arrears and her property  was foreclosed upon. The borough said that                                                            
state  statute  would  not  allow  them  to  go  back  and  look  at                                                            
extenuating circumstances.                                                                                                      
                                                                                                                                
SENATOR LINCOLN  said that she would  leave the language  out due to                                                            
cases such  as that.  The local  government should  be able  to make                                                            
those decisions.                                                                                                                
                                                                                                                                
CHAIRMAN  TORGERSON asked  if the  money being  discussed was  local                                                            
with no State treasury affect.                                                                                                  
                                                                                                                                
MR. VAN SANT said  that was correct, the legislature  "hasn't funded                                                            
this since 1996."                                                                                                               
                                                                                                                                
CHAIRMAN  TORGERSON said  he knew  that, he  just wanted  it on  the                                                            
record.                                                                                                                         
                                                                                                                                
There were no other questions or individuals giving testimony.                                                                  
                                                                                                                                
He asked for the will of the committee.                                                                                         
                                                                                                                                
SENATOR AUSTERMAN  moved HB 118 and zero fiscal note  from committee                                                            
with individual recommendations. There were no objections.                                                                      
                                                                                                                                

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