Legislature(2011 - 2012)SENATE FINANCE 532

02/24/2012 09:00 AM FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSSB 27(HSS) Out of Committee
Moved CSSB 136(FIN) Out of Committee
Moved SB 68 Out of Committee
Scheduled But Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
SENATE BILL NO. 136                                                                                                           
     "An Act providing a tax  credit for employing an Alaska                                                                    
     veteran that may  be taken against a  liability for the                                                                    
     tax  on  corporation  income;   and  providing  for  an                                                                    
     effective date."                                                                                                           
9:11:14 AM                                                                                                                    
Senator  Ellis   MOVED  to  ADOPT  the   proposed  committee                                                                    
substitute  for SB  136,  Work  Draft 27-LS0983\R  (Bullock,                                                                    
2/16/12) as a working document.                                                                                                 
9:11:19 AM                                                                                                                    
Co-Chair Stedman Objected for the purpose of discussion.                                                                        
DARWIN  PETERSON,  STAFF,  SENATOR BERT  STEDMAN,  explained                                                                    
that  the new  CS  version R  incorporated  four changes  as                                                                    
        · Subsection B on page 1, line 9 was rewritten so                                                                       
          that in order for the tax credit to apply, the                                                                        
          veteran must have been unemployed for at least                                                                        
          four weeks.                                                                                                           
        · Page 1, line 13 now required the tax credit to be                                                                     
          applicable for up to ten years for disabled                                                                           
        · On page 2, line 7 the amount of the tax credit                                                                        
          was increased to $3,000 for a disabled veteran;                                                                       
          the amount remained $2,000 for other veterans.                                                                        
        · On page 2, line 9 a $1,000 tax credit was added                                                                       
          for seasonal employment; under this section, a                                                                        
          veteran must be employed for at least 600 hours                                                                       
          for five consecutive months in order to qualify.                                                                      
9:12:47 AM                                                                                                                    
Co-Chair Stedman  WITHDREW his OBJECTION. Seeing  NO FURTHER                                                                    
OBJECTION, Work Draft 27-LS0983\R was ADOPTED.                                                                                  
Senator Wielechowski  introduced SB 136 and  stated that the                                                                    
changes in the new CS  made the legislation better. The bill                                                                    
was designed  assist veterans with the  unemployment problem                                                                    
that they were currently  experiencing. He stated that there                                                                    
had  been  concerns  raised  during  a  veterans  summit  in                                                                    
Fairbanks  and at  a  town hall  meeting  in Anchorage  that                                                                    
veterans had a higher  than average unemployment rate state-                                                                    
wide, as well as on the national level.                                                                                         
Senator  Wielechowski explained  that the  first Section  of                                                                    
the  bill specified  that you  could take  a tax  credit for                                                                    
employing a  veteran; the credit  could be taken  within ten                                                                    
years of service for disabled  veterans and within two years                                                                    
for   non-disabled  veterans.   The  rationale   behind  the                                                                    
timeframe was that  it was harder for veterans  to find jobs                                                                    
during the first months and years after exiting service.                                                                        
Senator Wielechowski  stated that  sub-Section C on  page 2,                                                                    
lines 5 through 8 detailed that  in order to qualify for the                                                                    
tax credit,  employment had to  cover 12  consecutive months                                                                    
and 1,560 work  hours; the credit was $3,000  for a disabled                                                                    
veteran and $2,000 for a non-disabled veteran.                                                                                  
Senator Wielechowski pointed out  that sub-Section 2 on page                                                                    
2, lines 9 through 13 was  added in response to a suggestion                                                                    
from Senator  Thomas and that  it incorporated a  $1,000 tax                                                                    
credit for employing a veteran in a seasonal position.                                                                          
9:15:26 AM                                                                                                                    
Senator  Olson  referenced  the  tax  credit  increase  from                                                                    
$2,000 to $3,000  for disabled veterans and  queried how the                                                                    
amount   of  $2,000   was   initially  determined.   Senator                                                                    
Wielechowski  responded that  the amount  of the  credit had                                                                    
been determined by looking at  what the other states and the                                                                    
federal government had  set their credits at.  He noted that                                                                    
he believed the  federal government had set  their credit at                                                                    
$2,400.  He observed  that it  had  been Co-Chair  Stedman's                                                                    
idea  to  increase  the  credit  in SB  136  to  $3,000  for                                                                    
disabled veterans and stated that he agreed with the idea.                                                                      
Senator Olson asked  how the tax credit compared  to that of                                                                    
other states.  Senator Wielechowski stated  that Legislative                                                                    
Research Services had conducted  an analysis about the other                                                                    
state  and  federal  tax  credits  that  were  available  to                                                                    
veterans (copy on  file). He gave examples  of other state's                                                                    
veteran tax credits as follows:                                                                                                 
              · Vermont had a $2,000 tax incentive, but it                                                                      
                only applied to veterans who had returned                                                                       
                from deployment in Afghanistan or Iraq with                                                                     
                the last two years.                                                                                             
              · California's veteran tax credit required                                                                        
                that a veteran had left service in the last                                                                     
                48 months.                                                                                                      
              · Illinois had a tax credit that was not to                                                                       
                exceed $1,200 annually.                                                                                         
              · West-Virginia had a tax credit available to                                                                     
                an employer of the first $5,000 in wages.                                                                       
Senator Thomas  thanked the bill  sponsor for  the inclusion                                                                    
of seasonal employment in the legislation.                                                                                      
Co-Chair   Stedman   discussed    a   previously   published                                                                    
indeterminate fiscal note: FN1 (DOR).                                                                                           
9:17:50 AM                                                                                                                    
Senator  Ellis   MOVED  to  report  CSSB   136(FIN)  out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal  note. There being NO  OBJECTION, it was                                                                    
so ordered.                                                                                                                     
9:18:23 AM                                                                                                                    
CSSB  136(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass"  recommendation   and  with  a   previously  published                                                                    
indeterminate fiscal note: FN1 (DOR).                                                                                           
Co-Chair Stedman asked that the  record reflect that Senator                                                                    
McGuire  had joined  the committee  and  that Senator  Cathy                                                                    
Giessel had been present throughout the meeting.                                                                                

Document Name Date/Time Subjects
Approved LegLog 1027 Response to SB144 Questions ( Sen Stedman).pdf SFIN 2/24/2012 9:00:00 AM
SB 144
SB 68 2011 CFAB Annual Report.pdf SFIN 2/24/2012 9:00:00 AM
SB 68
SB 27 Opposition Burn Association.pdf SFIN 2/24/2012 9:00:00 AM
SB 27
SB 27 Opposition Letters.pdf SFIN 2/24/2012 9:00:00 AM
SB 27
SB 27 Opposition Letters 2.pdf SFIN 2/24/2012 9:00:00 AM
SB 27
SB 68 Amendment 1.pdf SFIN 2/24/2012 9:00:00 AM
SB 68
SB 27 (HSS) Sectional Analysis.pdf SFIN 2/24/2012 9:00:00 AM
SB 27
SB 144 Letter of Support - Covenant House of Alaska.pdf SFIN 2/24/2012 9:00:00 AM
SB 144