Legislature(2015 - 2016)SENATE FINANCE 532

04/14/2015 09:00 AM FINANCE

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as
Download Video part 1. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ SB 53 Presentation: Overview FY17 Operating Budget TELECONFERENCED
Heard & Held
+ HB 146 MUNICIPAL TAX EXEMPTION TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= SB 82 ALCOHOL/SUBST ABUSE PROGRAM MITIGATION TELECONFERENCED
Moved SB 82 Out of Committee
CS FOR HOUSE BILL NO. 146(CRA)                                                                                                
                                                                                                                                
     "An Act relating to a municipal tax exemption for                                                                          
     certain subdivided property."                                                                                              
                                                                                                                                
9:49:37 AM                                                                                                                    
                                                                                                                                
SENATOR CATHY  MUNOZ, SPONSOR, explained  that HB  146 would                                                                    
give  municipalities the  option of  exempting the  increase                                                                    
value of  a new subdivision  until the lot started  to sell,                                                                    
or until  a certain  time period was  met. She  related that                                                                    
the legislation came as a result  of a request from the City                                                                    
and  Borough of  Juneau to  look  at ways  to encourage  new                                                                    
housing  development,  especially  affordable  housing.  She                                                                    
furthered that the  legislation would incentivize developers                                                                    
to   develop  lands   while  keeping   down  the   costs  of                                                                    
developments.   She   explained   that  currently   when   a                                                                    
subdivision  plot  map  was  finalized  and  certified,  the                                                                    
property assessment  rose considerably. She stated  that the                                                                    
legislation was  a tool that  would allow  municipalities in                                                                    
communities  with   housing  shortages  to  work   with  the                                                                    
developer  to exempt  a portion,  or all,  of the  increased                                                                    
valuation for a certain time period.                                                                                            
                                                                                                                                
9:51:41 AM                                                                                                                    
                                                                                                                                
EDRA MORLEDGE, STAFF TO SENATOR  KEVIN MEYER, explained that                                                                    
the  amendment  to the  bill  made  in the  Senate  Regional                                                                    
Affairs  Committee  would  allow  for  a  partial  or  total                                                                    
exemption,  or deferral  of  property  tax for  deteriorated                                                                    
properties.  The   amendment  clarified  that  the   8  unit                                                                    
requirement currently  in statute for the  rehabilitation of                                                                    
deteriorated  properties could  be required  at the  time of                                                                    
application for  the tax  exemption or  deferral, or  at the                                                                    
completion of  the project. The  amendment also  allowed for                                                                    
multiple  properties in  a designated  deteriorated property                                                                    
area to be  considered collectively for the  8 unit minimum.                                                                    
Finally, the  amendment made a technical  fix, inserting the                                                                    
word "not"  where it had  be omitted  prior on Page  2, line                                                                    
27.                                                                                                                             
                                                                                                                                
9:53:40 AM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon OPENED public testimony.                                                                                     
                                                                                                                                
9:54:25 AM                                                                                                                    
                                                                                                                                
GABE LAYMAN, GENERAL COUNSEL,  COOK INLET HOUSING, ANCHORAGE                                                                    
(via teleconference),  testified in support of  the bill. He                                                                    
asserted  the legislation  would  empower municipalities  to                                                                    
offer certain  property tax incentives that  would encourage                                                                    
private developers to proceed  with developments in Alaska's                                                                    
challenging  real estate  market. He  spoke to  the positive                                                                    
impact  of the  provisions  in the  bill  that pertained  to                                                                    
optional   municipal  property   tax   incentives  for   the                                                                    
redevelopment of  deteriorated properties. He  believed that                                                                    
HB 146  would clarify  ambiguous provisions of  the existing                                                                    
state  statute, improving  its  usefulness.  He pointed  out                                                                    
that municipalities  would need to  opt into the  program in                                                                    
order to offer  the tool to developers. He  shared that once                                                                    
a  municipality  opted  in,   it  retained  the  ability  to                                                                    
evaluate project  applications on a  case by case  basis. He                                                                    
concluded  that  the   legislation  would  promote  economic                                                                    
development,  further  empower   municipalities  to  address                                                                    
blight  and deterioration  in  a  locally controlled  manner                                                                    
without costing the state any money.                                                                                            
                                                                                                                                
9:56:01 AM                                                                                                                    
                                                                                                                                
CHUCK   HOMAN,  PRESIDENT,   ALASKA   STATE  HOME   BUILDING                                                                    
ASSOCIATION, EAGLE RIVER  (via teleconference), testified in                                                                    
support  of the  bill. He  noted that  his organization  had                                                                    
sent a letter of support (copy on file).                                                                                        
                                                                                                                                
9:56:43 AM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon CLOSED public testimony.                                                                                     
                                                                                                                                
9:57:05 AM                                                                                                                    
                                                                                                                                
Co-Chair  MacKinnon  asked how  the  bill  might affect  the                                                                    
values  across   the  state  in  comparison   to  the  state                                                                    
treasury.                                                                                                                       
RON   BROWN,  STATE   ASSESSOR,   DEPARTMENT  OF   COMMERCE,                                                                    
COMMUNITY   AND   ECONOMIC   DEVELOPMENT,   ANCHORAGE   (via                                                                    
teleconference), stated  that there exemption  was optional.                                                                    
He  explained  that if  a  municipality  were to  adopt  the                                                                    
legislation there  would be  zero impact  to the  full value                                                                    
determination, as  an optional exemption the  property would                                                                    
be  appraised and  reported by  the  local municipality  and                                                                    
added back into the full value for the community.                                                                               
                                                                                                                                
Co-Chair MacKinnon  asked how  the foundation  formula would                                                                    
be effected by the legislation.                                                                                                 
                                                                                                                                
Mr. Brown  explained that for optional  exemptions, the full                                                                    
value of  determination and local school  contribution would                                                                    
be returned to the local community.                                                                                             
                                                                                                                                
9:59:10 AM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon  asked if whether it  would positively or                                                                    
negatively affect the amount  of funding that municipalities                                                                    
would receive for schools.                                                                                                      
                                                                                                                                
Mr. Brown responded that the effect would be neutral.                                                                           
                                                                                                                                
Co-Chair MacKinnon thought that  the committee would need to                                                                    
hear from the Department of  Education on how the bill would                                                                    
affect the foundation formula.                                                                                                  
                                                                                                                                
10:00:03 AM                                                                                                                   
                                                                                                                                
TERRY HARVEY,  STAFF TO REPRESENTATIVE CATHY  MUNOZ, assured                                                                    
the  committee that  the  information  concerning the  bills                                                                    
effect on  formula funding for  education would  be provided                                                                    
to the committee.                                                                                                               
                                                                                                                                
CSHB 146(CRA)  was HEARD and  HELD in committee  for further                                                                    
consideration.                                                                                                                  
                                                                                                                                
10:00:14 AM                                                                                                                   
                                                                                                                                
Co-Chair MacKinnon discussed housekeeping.                                                                                      
                                                                                                                                

Document Name Date/Time Subjects
SB53 Backup States Adopting APRN Consensus Model.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Sectional Analysis vsn N.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Sponsor Statement vsn N.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support AaNA 3-9-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support AARP 3-3-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support AK Affiliate ACNM 2-23-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support AK Pharmacists 3-6-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support ANPA 2-24-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support AKANA 2-22-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support APRN Alliance 2-22-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support ASHNHA 3-5-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Bd of Nursing 3-9-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Dooley 3-6-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support FASDx Services 2-26-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Hartz 2-26-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Hiles 3-16-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Myers 2-24-2015.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Support Rader 2-22-15.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
SB53 Title Change Chart.pdf SFIN 4/14/2015 9:00:00 AM
SB 53
HB 146 - SB87 AAHA Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 ADP Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Anchorage Community Development Authority Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Anchorage Community Land Trust Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Anchorage Economic Development Corporation Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 CIHA Statement.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Fairview BA Letter.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Jack White Real Estate Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Peach Investments Letter.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Tacoma tax invest article.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 - SB87 Weidner Apartment Homes Letter of Support.pdf SFIN 4/14/2015 9:00:00 AM
HB 146
SB 87
HB 146 Statement Layman.pdf SFIN 4/14/2015 9:00:00 AM
HB 146