02/22/2007 01:30 PM Senate LABOR & COMMERCE

            CSHJR 8(L&C) AM WASHINGTON CONTAINER FEE                                                                        
                                                                                                                              
CHAIR   ELLIS  announced   CSHJR   8(L&C)  AM   to   be  up   for                                                               
consideration.                                                                                                                  
                                                                                                                                
REPRESENTATIVE BILL  THOMAS, sponsor of  HJR 8, related  that the                                                               
Washington legislature  has introduced  SB 5207 that  proposes to                                                               
levy a  $50 tax  on 20 ft.  vans and  a $100 tax  on 40  ft. vans                                                               
leaving from  and going into  Washington. This will  represents a                                                               
10 percent increase  in freight cost of shipping  goods to Alaska                                                               
- a $40 million to $50  million increase. He said that 97 percent                                                               
of  goods  that  come  to  Alaska come  in  container  vans  from                                                               
Washington.                                                                                                                     
                                                                                                                                
1:40:53 PM                                                                                                                    
SENATOR DAVIS arrived.                                                                                                          
                                                                                                                                
REPRESENTATIVE  THOMAS  said  that  the state  of  Washington  is                                                               
targeting  Japanese and  Chinese  exports and  Alaska freight  is                                                               
incidental.  He   hoped  to  get  this   resolution  through  the                                                               
legislature  in  time to  keep  the  bill  from being  passed  in                                                               
Washington. His district consists  of primarily fishermen and its                                                               
related   processing    facilities,   so   this   would    be   a                                                               
disproportionate increase  for them. The  cost of moving  fuel to                                                               
Interior Alaska would increase as well.                                                                                         
                                                                                                                                
He related that Alaska can take  credit for about 103,500 jobs in                                                               
Washington  and brings  in  about $4  billion  worth of  products                                                               
through its ports.                                                                                                              
                                                                                                                                
1:43:28 PM                                                                                                                    
EVERETT BILLINGSLY, Linden Companies,  said he strongly supported                                                               
HJR  8.  Linden is  also  actively  working with  the  Washington                                                               
legislature to make sure this  issue doesn't go anywhere. He said                                                               
the  goal of  the  tax was  to get  money  to improve  Washington                                                               
infrastructure  and to  tax the  large  container lines  bringing                                                               
massive quantities  of cargo in to  the US from Asia.  The impact                                                               
on  Alaska  was  an  unintended consequence.  Alaskans  have  few                                                               
alternatives  to   using  Washington   ports  and   because  most                                                               
containers  return from  Alaska empty,  the tax  will effectively                                                               
double on a typical Alaska  Marine Lines (AML) container. He said                                                               
that  last   year  Linden  Transport   and  AML   together  moved                                                               
approximately  124,000  20-foot  containers  between  Alaska  and                                                               
Washington.  This  tax would  have  resulted  in more  than  $6.2                                                               
million in additional costs for shipping customers.                                                                             
                                                                                                                                
He  also mentioned  that the  sponsor is  coordinating this  bill                                                               
with  another  one   in  California  and  that   Hawaii  is  also                                                               
considering  similar  legislation.  Last  year it  did  pass  the                                                               
California  legislature, but  Governor Schwarzenegger  vetoed it.                                                               
He might not be able to do it again.                                                                                            
                                                                                                                                
1:46:42 PM                                                                                                                    
CHAIR  ELLIS closed  the public  hearing and  pointed out  a zero                                                               
fiscal  note and  said  that no  one had  come  forward with  any                                                               
amendments.                                                                                                                     
                                                                                                                                
1:47:22 PM                                                                                                                    
SENATOR DAVIS moved  to pass CSHJR 8(L&C) am  from committee with                                                               
individual recommendations  and zero  fiscal note. There  were no                                                               
objections and it was so ordered.