Legislature(2017 - 2018)SENATE FINANCE 532
04/11/2017 01:30 PM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB48 | |
| SB45 | |
| SB78 | |
| SB51 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 51 | TELECONFERENCED | |
| + | SB 83 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | HB 48 | TELECONFERENCED | |
| += | SB 45 | TELECONFERENCED | |
| += | SB 78 | TELECONFERENCED | |
SENATE BILL NO. 78
"An Act creating the education endowment fund and the
dividend lottery fund; authorizing contributions from
the permanent fund dividend to the dividend lottery
fund; relating to transfers from the dividend lottery
fund and the education endowment fund; relating to the
definition of 'gambling'; and providing for an
effective date."
1:55:59 PM
Vice-Chair Bishop MOVED to ADOPT proposed committee
substitute for SB 78, Work Draft 30-LS0534\M (Martin,
4/5/17).
Co-Chair MacKinnon OBJECTED for discussion.
Co-Chair MacKinnon noted that the public hearing on the
bill had been held on April 7, 2017.
1:56:44 PM
PETE FELLMAN, STAFF, SENATOR CLICK BISHOP, shared that
people had been uncomfortable with the word "lottery" being
used in the legislation. He said that the word "raffle" had
been chosen as a replacement because the bill was akin to a
bucket raffle. He stated that throughout the bill the
descriptions for "contributions" and "donations" had been
clarified to indicate that the donations would be used for
a specific purpose. He added that some language had been
changed from "may to "shall" because it would clarify that
the commissioner would use the donations for the programs
that the bill created. He referred to the document,
"Changes Proposed by Finance CS-Version 30-LS0534\M to
CSSB78(EDC) (copy on file):
Proposed Finance CS would change all references from
"lottery" to "raffle" and it will change all
references from 'contributions" to "donations" it also
changes the "may" to "shall"
Bill Title
Page 1, line 1: Delete "lottery" Insert "raffle"
Page 1, line 2: Delete "contributions" Insert
"donations"
Page 1, line 2: Insert "for educational"
Page 1, line 3: Insert "purposes and to enter the
permanent fund dividend raffle"
Page 1, line 3: Delete "lottery fund" Insert "raffle"
Page 1 line 4: Delete "lottery" Insert "raffle"
*Section 1. AS 11.66.280(3) is amended to read.
Page 2 line 19: Delete "drawing" Insert "raffle"
*Section 2. AS 43.23.063. Education endowment fund.
Page 2 line 25: Delete "contributions" Insert
"donations"
Page 3 line 18: Delete "lottery" Insert "raffle"
Page 3 line 19: Delete "contributions" Insert
"donations" Delete "lottery" Insert "raffle"
Page 3 line 20: Delete "lottery" Insert "raffle"
Page 3 line 22: Delete "may" Insert "shall"
Page 3 line 23: Delete "contributions" Insert
"donations"
Page 3 line 24: Delete "may "Insert "shall" Delete
"lottery" insert "raffle"
Page 3 line 28: Delete "lottery" Insert "raffle"
Page 3 line 31: Delete "contributed" Insert "donated"
Page 4 line 4/5 Delete "contributed" Insert "donated
for educational purposes and to enter the
permanent fund dividend raffle"
Page 4 line 5: Delete "contributions" Insert
"donations"
Page 4 line 8: Delete "contributions "Insert
"donations"
Page 4 line 9: Delete "may" Insert "shall"
Page 4 line 10: Insert "shall appropriate"
Page 4 line 11: Delete "lottery" Insert "raffle"
Delete "may" Insert "shall"
Page 4 line 12: Delete "contributions" Insert
"donations"
Page4 line 13: Delete "Nothing in this section created
a dedicated fund"
Page 4 line 15: Delete "lottery" Insert "raffle"
Page 4 line 15, 16: Delete "contribution to the fund"
Insert "donation as provided in (b) of this section"
Page 4 line 17: Delete "drawing" Insert "raffle"
Page 4 line 19, 21, 23, 25: Delete "lottery "Insert
affle"
Page 4 line 26: Insert "Nothing in this section
creates a dedicated fund.
*Section 3. This act takes effect January 1, 2018
1:59:02 PM
Co-Chair MacKinnon asked about Page 4, line 9; and queried
the purpose of changing the word "may" to "shall."
Mr. Fellman explained that the language change was meant to
specify that the money would be used exclusively for
education.
1:59:58 PM
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
OBJECTION, it was so ordered.
Senator Micciche wondered whether an individual could
write-off $75 dollars as a donation to the Public Education
Fund and the Education Endowment, while the $25 to the
raffle fund would be non-deductible.
Mr. Fellman answered in the affirmative.
2:00:58 PM
Co-Chair MacKinnon solicited comments from the
administration concerning the legislation.
SARA RACE, DIRECTOR, PERMANENT FUND DIVIDEND DIVISION,
DEPARTMENT OF REVENUE, replied that the fund would work
similarly to the University of Alaska College Savings
Program and would be another available option on the online
permanent fund application.
2:01:29 PM
Senator von Imhof considered the estimated 2 percent
administrative costs and wondered whether the costs could
fluctuate as the raffle became more popular.
Ms. Race stated that the Treasury Division would be
managing the account, while the Permanent Fund Division
would be simply hosting the program through the
application. She said that she could refer the question to
the Treasury Division and have an answer sent back to the
committee.
Senator von Imhof wanted assurances that the administrative
cost would be controlled.
2:03:00 PM
Co-Chair MacKinnon noted that there was a one-time, fixed
expense of $8 thousand. She asked Ms. Race whether there
was anything she would like to highlight in the fiscal
note.
Ms. Race believed that the department could implement the
proposed program online application. She said that the one-
time charge was needed to make the changes necessary to
implement the program.
Co-Chair MacKinnon referred to the second page of the
fiscal analysis (FN 3):
This added option will require programming changes to
be made to the division's database and online dividend
application. It will take approximately 50 hours at $
160.00 per hour for a total of $8,000.
Ms. Race answered that the analysis was correct.
2:04:09 PM
Senator von Imhof queried the mechanics of the drawing.
2:04:43 PM
AT EASE
2:05:27 PM
RECONVENED
Mr. Fellman relayed that the department had communicated
that it was already doing online advertising for other
programs such as college savings program and thought it
would be very simple to add the raffle to those
advertisements.
2:06:12 PM
Senator Micciche understood that a person who turned 18
March 31, the deadline for the application, would be
eligible to participate in the raffle.
Ms. Race replied in the affirmative. She stressed that the
option to participate would only be available on an adult
application.
Co-Chair MacKinnon asked what would happen if an estimated
dividend did not cover the cost of the preordered raffle
tickets.
Ms. Race responded that the division would consider it in
the same way it currently handled garnishment, contribution
or assignment.
Co-Chair MacKinnon understood that the program would be
administered through regulation.
Ms. Race answered in the affirmative.
Co-Chair MacKinnon referred to an order of priority for
vetting those who owed the state money in the form of court
fines, child support, etc. She asked whether the bill
specifically prevented people from purchasing raffle
tickets if they had fiduciary obligations to the state.
Ms. Race stated that involuntary deductions were always
taken out first; the administration recommended that
language be written into the bill that addressed voluntary
deductions.
2:09:34 PM
Co-Chair MacKinnon said that the bill would be held until
the language was inserted. She requested that Ms. Race work
with the bill sponsor to update the legislation.
2:10:05 PM
Co-Chair MacKinnon noted that there were multiple voluntary
deductions that could be made, and she hoped to hear
recommendations from the administration and the committee
in the immediate future.
Senator Micciche probed the prioritization of deductions,
whether voluntary or involuntary.
Ms. Race specified that garnishments would always be paid
out first, then the university college savings program, any
funds available after that would be distributed to
Pick.Click.Give recipients in the order they were selected.
2:11:43 PM
Senator von Imhof thought it would make sense to put the
raffle alongside the Pick.Click.Give program as a voluntary
donation to education.
2:12:20 PM
Senator Micciche agreed with the payment priority list set
out by the administration. He thought that it needed to be
decided whether the raffle would come before or after
Pick.Click.Give on the priority list.
Ms. Race agreed.
2:12:52 PM
Co-Chair MacKinnon asked whether the sponsor had any
recommendations.
Vice-Chair Bishop appreciated the conversation and stated
that he was open to the committee's thoughts on the
legislation.
Senator Micciche feared that the raffle could take funds
away from organizations already in the Pick.Click.Give
program, which could result in the state having to pay for
additional services.
Co-Chair MacKinnon reiterated that involuntary deductions
already had a priority payment written into statute. She
stated that the issue to consider was how to order
voluntary contributions for payment.
2:15:00 PM
Vice-Chair Bishop referred to $388 million spent annually
on raffle tickets in the state.
Senator von Imhof wondered whether there could be a way to
let an applicant know when they had exhausted their total
dividend and had no more available funds to donate
Ms. Race replied in the negative. She stated that at the
point in time that the dividend application was being
administered, the amount of the dividend was not known. She
continued that individuals selected their contributions
based on a projected dividend amount.
2:17:20 PM
Co-Chair MacKinnon asked whether statute allowed for a
prorated reduction of a Pick.Click.Give. donation when the
actual dividend amount was less than the original donation.
Ms. Race stated that the distribution of the voluntary
donations to Pick.Click.Give would have priority based on
the order in which the organizations were chosen.
2:18:52 PM
Senator Micciche thought that if would be difficult to
choose whether to donate to Pick.Click.Give or the raffle.
2:19:54 PM
Vice-Chair Bishop agreed with Senator Micciche.
Co-Chair MacKinnon stated that with the support of the
sponsor, she would draft a committee substitute, which
would be sent in a timely manner to offices for review.
Mr. Fellman spoke to the concern addressed by Senator
Micciche. He thought that the language could be structured
to allow a person pinking the lottery first and then picked
an organization from Pick.Click.Give then the lottery could
be the last priority for payment.
Co-Chair MacKinnon wondered whether a modification in the
prompting programming for donations would be possible and
queried the cost of making changes to the application
prompting programming.
Ms. Race replied that modifying the program was possible.
She felt that further research should done to determine a
specific cost. She noted that Pick.Click.Give and the
university savings program were separate choices that would
be made when applying for a dividend, the lottery would
create a third choice.
2:22:08 PM
Co-Chair MacKinnon hoped Ms. Race could work with division
programmers to understand the details and cost of any
necessary changes.
SB 78 was HEARD and HELD in committee for further
consideration.
2:23:17 PM
AT EASE
2:23:56 PM
RECONVENED