Legislature(2015 - 2016)BELTZ 105 (TSBldg)

01/28/2016 01:30 PM LABOR & COMMERCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB 155 FEES; WAIVERS; CREDITS; DEDUCTIONS;TAXES TELECONFERENCED
Heard & Held
+= HB 12 MORTGAGE LENDING AND LOAN ORIGINATORS TELECONFERENCED
Heard & Held
*+ SB 111 LIMIT FLAME RETARDANT ITEMS/FURNITURE TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled: TELECONFERENCED
+= SB 121 SECURITY FREEZE ON MINOR'S CREDIT REPORT TELECONFERENCED
Moved SB 121 Out of Committee
-- Public Testimony --
        HB 155-FEES; WAIVERS; CREDITS; DEDUCTIONS; TAXES                                                                    
                                                                                                                                
2:05:51 PM                                                                                                                    
CHAIR COSTELLO  announced the consideration  of HB 155.  [This is                                                               
the first hearing and CSHB 155(FIN) is before the committee.]                                                                   
                                                                                                                                
2:06:05 PM                                                                                                                    
REPRESENTATIVE STEVE THOMPSON,  Alaska State Legislature, Juneau,                                                               
Alaska,  sponsor of  HB 155,  introduced the  legislation stating                                                               
the following:                                                                                                                  
                                                                                                                                
     In the  28th Legislature,  legislation was  passed that                                                                    
     defined indirect expenditures  as foregone revenue. The                                                                    
     legislation also  set forth a requirement  that certain                                                                    
     reports identify potential loss  of foregone revenue by                                                                    
     the  department.   The  Legislative   Finance  Indirect                                                                    
     Expenditure   Report   reviewed  the   departments   of                                                                    
     Commerce, Community and  Economic Development, Fish and                                                                    
     Game,  Health  and  Social Services  and  Revenue.  The                                                                    
     report  identified  certain credits,  fees,  discounts,                                                                    
     and deductions  that should  be terminated.  House Bill                                                                    
     155  repealed  some  of   these  expenditures  with  an                                                                    
     estimated   increase   of  revenue   of   approximately                                                                    
     $450,000.                                                                                                                  
                                                                                                                                
He requested that his staff walk through the bill.                                                                              
                                                                                                                                
2:07:02 PM                                                                                                                    
BRODIE  ANDERSON, Staff,  Representative  Steve Thompson,  Alaska                                                               
State Legislature,  sponsor of  HB 155, stated  that the  bill is                                                               
the next  step in  addressing the foregone  revenue to  the state                                                               
identified in the  2015 Indirect Expenditure Report.  HB 155 will                                                               
repeal the following indirect expenditures:                                                                                     
                                                                                                                                
   · Small Loan Company Business License Exemption                                                                              
   · The Exploration Incentive Credit                                                                                           
   · Tobacco Product Tax Deduction for Timely Filing                                                                            
   · Cigarette Tax Stamp Discount                                                                                               
   · Motor Fuel Tax Timely Filing                                                                                               
   · Large Passenger Vessel Gambling Tax Deduction                                                                              
                                                                                                                                
MR.  ANDERSON explained  that the  bill  repeals the  exemptions,                                                               
credits, deductions  and discounts  in Section 10.  The remainder                                                               
of  the sections  provide  cleanup language  to  the portions  of                                                               
statute that  reference those statutory repeals.  He provided the                                                               
following sectional analysis:                                                                                                   
                                                                                                                                
     Sections  1-2  repeal  references  to  the  Exploration                                                                    
     Incentive Credit from AS 41.09.010(a) and (b).                                                                             
                                                                                                                                
     Section  3  removes  references  from  the  Exploration                                                                    
     Incentive Credit from AS 43.20.043(g).                                                                                     
                                                                                                                                
     Section  4   amends  AS   43.55.210  to   disallow  the                                                                    
     deduction  for  federal  taxes   for  the  purposes  of                                                                    
     calculating  the state  tax on  large passenger  cruise                                                                    
     ship gambling activity.                                                                                                    
                                                                                                                                
     Section 5  amends AS 43.40.010(c) by  removing language                                                                    
     that allowed motor fuel dealers  to retain a portion of                                                                    
     the motor  fuel tax  due to  cover expenses  for filing                                                                    
     motor fuel tax return.                                                                                                     
                                                                                                                                
     Section  6  removes  references to  the  Cigarette  Tax                                                                    
     Stamps from AS 43.50.590(a).                                                                                               
                                                                                                                                
     Sections  7,  8  and  9   remove  references  from  the                                                                    
     Exploration  Incentive  Credit  from  AS  43.55.011(m),                                                                    
     43.55.020(a) and 43.55.023(l).                                                                                             
                                                                                                                                
     Section  10  repeals  AS 06.20.030(c)  The  Small  Loan                                                                    
     Company  License;   AS  38.05.180(i)   The  Exploration                                                                    
     Incentive   Credit;   AS  41.09.030   The   Exploration                                                                    
     Incentive  Credit; AS  43.50.330(b) The  Excise Tax  on                                                                    
     Tobacco  Products;,  43.50.540(c)   The  Cigarette  Tax                                                                    
     Stamps; and 43.50.540(h) the discount for the stamps.                                                                      
                                                                                                                                
     Section  11 provides  transition  language relating  to                                                                    
     the Exploration Incentive Credit.                                                                                          
                                                                                                                                
     Section 12  contains the effective  date of  January 1,                                                                    
     2016 for the gambling tax activities.                                                                                      
                                                                                                                                
     Section 13 provides  an effective date of  July 1, 2015                                                                    
     for  the other  sections in  order to  comply with  the                                                                    
     State  of Alaska  fiscal calendar  year  and all  other                                                                    
     related  fees,   discounts  and  deductions   that  are                                                                    
     calculated monthly.                                                                                                        
                                                                                                                                
2:10:47 PM                                                                                                                    
CHAIR  COSTELLO  questioned  the  reason  for  the  indeterminate                                                               
fiscal   note  when   the  anticipated   additional  revenue   is                                                               
approximately $450,000.                                                                                                         
                                                                                                                                
MR. ANDERSON deferred the question to Brandon Spanos.                                                                           
                                                                                                                                
2:11:29 PM                                                                                                                    
BRANDON  SPANOS, Deputy  Director,  Tax  Division, Department  of                                                               
Revenue  (DOR), Anchorage,  Alaska,  explained  that DOR  doesn't                                                               
collect  information needed  to estimate  the impact  of all  the                                                               
provisions  of  the  bill. The  estimated  increased  revenue  of                                                               
approximately  $450,000  is  based   on  the  money  forgone  for                                                               
affixing stamps  to cigarette packs  and other  tobacco products,                                                               
the  motor fuel  credit and  large passenger  gaming. "Those  are                                                               
numbers  we can  quantify and  that's where  that $450,000  comes                                                               
from," he said.                                                                                                                 
                                                                                                                                
2:12:59 PM                                                                                                                    
DANIEL   STICKEL,  Assistant   Chief  Economist,   Tax  Division,                                                               
Department  of  Revenue (DOR),  Juneau,  Alaska,  added that  DOR                                                               
currently does  not collect information  about the  deduction for                                                               
federal taxes so there may be  some revenue impact from the Large                                                               
Passenger  Vessel  Gambling Tax  but  the  amount of  benefit  is                                                               
unclear. "The $450,000 is probably  the floor. The actual revenue                                                               
benefit  might  be  higher  than  that but  it  is  the  lack  of                                                               
information  on  the gambling  taxes  is  the  reason we  put  an                                                               
indeterminate on the revenue."                                                                                                  
                                                                                                                                
CHAIR  COSTELLO asked  if this  money would  go into  the general                                                               
fund.                                                                                                                           
                                                                                                                                
MR. SPANOS indicated that was correct.                                                                                          
                                                                                                                                
CHAIR COSTELLO  noted that  the sponsor was  nodding his  head in                                                               
the affirmative.                                                                                                                
                                                                                                                                
REPRESENTATIVE  THOMPSON offered  that  these  credits are  taken                                                               
against corporate  taxes so  the business would  pay more  tax to                                                               
the state, which he assumes would go to the general fund.                                                                       
                                                                                                                                
CHAIR COSTELLO  noted that the  fiscal note says  the regulations                                                               
would go  into effect  the last  day of 2016.  She asked  if that                                                               
will cause a problem.                                                                                                           
                                                                                                                                
MR. ANDERSON  said he spoke with  her staff about the  need for a                                                               
committee substitute to  reflect new dates. "The  2016 date would                                                               
be 2017 and the 2015 dates would turn into 16."                                                                                 
                                                                                                                                
CHAIR  COSTELLO   asked  if  there  has   been  discussion  about                                                               
emergency regulations to maintain the current timeline.                                                                         
                                                                                                                                
MR. ANDERSON  answered no, but  it is a conversation  the sponsor                                                               
could have with the department.                                                                                                 
                                                                                                                                
2:16:21 PM                                                                                                                    
SENATOR MEYER expressed appreciation for the legislation.                                                                       
                                                                                                                                
2:16:33 PM                                                                                                                    
CHAIR COSTELLO opened public testimony.  Finding none, she closed                                                               
public testimony and held HB 155 in committee.                                                                                  

Document Name Date/Time Subjects
HB 12 - Sponsor Statement.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Sectional Analysis.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12- Fiscal Note DCCED-DBS.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Flow Chart and Explanation.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents - SAFE Act.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Allie Hewitt.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Curtis Green.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Doug McCann.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Jim Kelly.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Justin Goodman.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Kris Yoder.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Kristie Babcock.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Nancy Field.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Rueben Willis.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Randy Rhodes.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Shannon Fortune.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter State Farm Agents.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter State Farm Corporation.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Todd Jackson.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Troy Sayer.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 12 - Supporting Documents-Letter Tyler Randolph.pdf SL&C 1/28/2016 1:30:00 PM
HB 12
HB 155 - Sponsor Statement.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Version Changes H-N.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Fiscal Note DOR.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Cigarette Tax Stamp Discount.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Commercial Passenger Vessel Gambling Tax Deduction.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Exploration Incentive Credit.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Motor Fuel Tax Timely Filing Discount.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Small Loan Company Exemption.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
HB 155 - Support Document Indirect Expenditure Report - Tobacco Product Tax Timely Filing Deduction.pdf SL&C 1/28/2016 1:30:00 PM
HB 155
SB 111 - Sponsor statement.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Fiscal Note DEC.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Fiscal Note DPS.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - AFN Resolution.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - AK Professional Fire Fighters Assoc.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Alaska Nurses Association Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Arc of Anchorage Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - ASBC Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Breast Cancer Fund Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 -Tony Stefani and Firefighters Cancer Prevention Foundation 1-27-16.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - American Chemistry Council Opposition Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Motorcycle Industry Council Letter.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Federal Statutes Regulating Chemicals.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
State Chamber SB111.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Journal Article - Prenatal exposure to polybrominated diphenyl ethers and child attention.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Journal Article - Flame Retardants in Furniture Foam Benefits and Risks.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - San Francisco Chronicle - Chemical industry hoodwinked California Legislature.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - European Food Safety Authority Brominated Flame Retardants.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Are PBDE's Making Bald Eagles Go Extinct.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Article - Flame Retardants Are They Extinguishing Brain Development.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - CDC Statement on PBDEs.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Chicago Tribune - Fear fans flames for chemical makers.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Chicago Tribune Article - Distorting Science.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - EndoWeb - Hypothyroidism Linked to Flame Retardants.pdf SL&C 1/28/2016 1:30:00 PM
SB 111
SB 111 - Misc. Support E-mails.pdf SL&C 1/28/2016 1:30:00 PM
SB 111