Legislature(2015 - 2016)BUTROVICH 205
02/16/2016 01:00 PM Senate TRANSPORTATION
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.
| Audio | Topic |
|---|---|
| Start | |
| SB132 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 132 | TELECONFERENCED | |
SB 132-ELECTRONIC TAX RETURNS & MOTOR FUEL TAX
1:18:15 PM
CHAIR MICCICHE announced consideration of SB 132. [Work draft
CSSB 132, version 29-GS2912\H, was before the committee.] He
said public testimony is still open and that at the last meeting
the Department of Revenue (DOR) was asked to bring some
projections on oil at the $70 to $90 a barrel range.
1:18:55 PM
JERRY BURNETT, Deputy Commissioner, Department of Revenue (DOR),
Juneau, Alaska, said the projections he provided include all of
the revenues that are available on an annual basis for
appropriation by the legislature. The estimate for FY17 is $6.2
billion; $6.1 billion of it is total available recurring
revenue. He explained the various places where revenues come
from provided in the charts and said he didn't know how the
legislature would chose to balance the budget this year.
SENATOR STEDMAN said the direction of the question wasn't so
much the aggregate total revenues subjected to appropriations,
but the mechanics of the severance tax portion of the tax bill
and the impacts the credits have.
DAN STICKLE, Assistant Chief Economist, Department of Revenue
(DOR), Juneau, Alaska, said for the revenues that come in
through the oil and gas production tax there is a point at
around $80/barrel where for each $1 of value in the barrel of
oil the state takes an increasing share. At this point the tax
transitions from the gross minimum production tax to paying the
progressive 35 percent income tax.
1:22:58 PM
SENATOR STEDMAN said this would have to be looked at in another
committee, but stated that "Nobody pays 35 percent. It's
mathematically impossible."
CHAIR MICCICHE explained that the reason he picked the $85 price
point is because it gave some room in the $80 to $85 range. If
the budget is reduced as planned, there would be more revenue
than needed at those price ranges. He thought it the right place
to promise Alaskans they would be returning some of this
revenue. However, some of the measures may not go through,
including a draw and that would be a very different picture.
He wanted to discuss a potential amendment. The changes include
removing the electronic submission, because it was problematic
in accordance Legislative Legal. That could be fixed in another
bill perhaps. The claw back was added that at $85/barrel for the
previous calendar year that the taxes would revert to current
rates. Two new exemptions were added for fuels in an emergency
vehicle and students' transportation services and made a few
statutory cleanup changes. Then finally, the tax is sunsetted on
July 1, 2018.
1:25:19 PM
SENATOR MICCICHE said another area of interest is they want
Alaskans to be able to transparently view this pool of revenue
with a special accounting fund by each fuel tax category. He
asked what dedicating funds back to transportation would look
like and to have that as a conceptual amendment.
MR. BURNETT answered that a number of revenues that are
accounted for in a separate fund. For example, when the alcohol
tax was last increased it created an Alcohol Substance Abuse
Fund where half of the alcohol tax was put in that fund and then
it's separately accounted for in the budget. Doing a similar
type measure with this is possible. This money is currently
accounted for in subaccounts of the General Fund, so it
certainly can be identified. He was certain the Department of
Transportation and Public Facilities' (DOTPF) budget contains
significantly more general funds dollars than is collected in
motor fuel taxes. But, there is no technical or legal issue with
doing what he suggests.
CHAIR MICCICHE asked if there is a cost.
MR. BURNETT answered that the department had never accounted for
an additional cost in a fiscal note for setting up a new fund in
the past when it was an accounting type fund.
1:28:57 PM
At ease
1:30:07 PM
CHAIR MICCICHE called the meeting back to order and noted
letters of support and two letters of opposition. Finding no
further comments, he closed public testimony.
SENATOR BISHOP offered conceptual Amendment 1 to create a
special accounting fund for the motor fuel tax to be identified
by fuel source; and he emphasized the fund is not to be
dedicated. There were no objections and Amendment 1 was adopted.
SENATOR BISHOP moved to report CSSB 132, version H as amended,
from committee with individual recommendations and attached
fiscal note(s).
1:31:42 PM
At ease
1:32:21 PM
CHAIR MICCICHE called the meeting back to order.
SENATOR DUNLEAVY objected. He said vetting the bill has been a
good process, but it's premature for taxes. It will raise $46
million, but he is on the Finance Committee that is still
finding "pockets of money." So, from his perspective they need
to spend another year "doing due diligence" on these funds in
the various departments and divisions, and when they get to the
point of discovering all the pots of money and they have been
used to cover this hole, he would feel more comfortable having a
serious conversation about revenue measures. If they default too
quickly to revenue measures they will never get to the bottom of
these funds and some of the things money is spent on.
SENATOR STEDMAN said he wouldn't support this measure now, but
he also thought it might be needed in the future. Other areas in
the tax structure need significant work and pale in comparison
to the revenue this measure is going to generate.
1:34:44 PM
SENATOR EGAN said he would reluctantly support this bill,
because he wants it out of this committee and into the Finance
Committee where it can be tackled to a greater degree.
SENATOR BISHOP said he would also support the bill; his reasons
for supporting it haven't changed from his origianl testimony.
CHAIR MICCICHE clarified that he, too, didn't know if he
supports the bill, but he wants to move it to the next
committee. He explained that the Transportation Committee
reviews the effect on transportation and they had done that and
added provisions that make the taxes revert to current rates
when it goes beyond where he feels transportation should be
contributing at that level and two new fuel tax exemptions have
been added. They also sunset the bill is two so it could be
reviewed if it does pass the legislature. They have also
provided an amendment allowing for a special accounting funds so
that Alaskans can transparently see where those funds are coming
from and what their totals are.
A roll call vote was taken: Senators Egan, Bishop, Micciche
voted yea; Senators Stedman and Dunleavy voted nay. Therefore,
CSSB 132, version \H as amended, moved from committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB132 DOR response for 'trigger' estimate analysis.pdf |
STRA 2/16/2016 1:00:00 PM |
SB 132 |