Legislature(1997 - 1998)

03/19/1998 01:35 PM TRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
            CSHB 231(FIN) - REGULATION OF SNOWMOBILES                          
CHAIRMAN WARD brought CSHB 231(FIN) before the committee as the                
final order of business and stated the committee would take                    
testimony from witnesses waiting to testify over the legislative               
teleconference network.                                                        
MAX LOWE, President of the Alaska Snowmobile Representatives                   
Alliance (ASRA), testifying from Anchorage in support CSHB
231(FIN), said the alliance feels it is the proper funding                     
mechanism for construction and improvement of trails, trail signage            
maintenance, etc., in the state of Alaska.  He said there are great            
safety implications for snowmobiling in the bill, and it has the               
support of the majority of recreational users and clubs.                       
Number 268                                                                     
SENATOR HALFORD questioned what the envisioned fee would be for                
registering a snowmobile at the time of purchase.  MR. LOWE replied            
that there is currently a $5  per year fee which has to be renewed             
every two years.  He noted that in eleven western states, the fees             
range anywhere from $15 to $26 per year.                                       
SENATOR HALFORD asked the status of municipal taxation on these                
vehicles.  MR. LOWE responded that there is none at this time.                 
Although it was on the property tax roles of the municipality at               
one time, it was exempted along with boats, aircrafts, etc.                    
SENATOR HALFORD said his only concern is that we not create a very             
attractive vehicle for municipalities to jump on to and people end             
up paying $50 or $75 on a new machine per year.  MR. LOWE agreed               
that it is a possibility, but he expressed the need  to move this              
legislation ahead and get some trails funding because that could be            
a possibility at any time.                                                     
Number 295                                                                     
CHAIRMAN WARD announced the arrival of Representative Masek who is             
the prime sponsor of HB 231.                                                   
KEVIN HITE, representing the Alaska State Snowmobile Association               
and testifying from Anchorage, stated their support for CSHB
231.(FIN).   For years snowmobile clubs have sought this type of               
state mechanism for registration and accounting.  They support the             
legislation in several areas, primarily the accounting of the                  
number of registrations in Alaska for acquiring trail funding, as              
well as the advantages and benefits to owners of this being a theft            
MICHAEL EASTHAM, representing the Snomad Snowmachine Club  and                 
testifying from Homer, voiced their total support for the                      
legislation.  They believe it will a big advantage to snowmobile               
owners because it will provide an easier way to register  their                
snowmachines.  He noted a state parks survey has shown that                    
approximately six to eight thousand new snowmobiles are sold                   
annually in Alaska, which, he said, represents a large dollar value            
of revenues being lost to the state.  It is his understanding that             
some snowmobile dealers are opposed to this legislation because of             
the added responsibility of registering newly purchased                        
snowmobiles, but he believes these dealers should have to share the            
burden for the convenience of the new owners.  He has also heard               
that some Native groups and persons living in remote areas are                 
opposed to this, and although it has been law since 1968 that                  
snowmobiles be licensed by owners, he assumes that 10 percent or               
less of those people living in those areas even register their                 
snowmobiles, which is a great loss of revenue to the state.                    
Number 360                                                                     
BILL EASTHAM, testifying from the Mat-Su LIO in support of CSHB
231(FIN), said they need another vehicle for snowmachine users to              
be able to register their snowmachines besides standing in line at             
the Division of Motor Vehicles.                                                
SENATOR HALFORD wondered if any of the people testifying would                 
object if the legislation had a provision in it that said it                   
wouldn't be used as the basis of establishing a municipal                      
snowmobile property  tax.                                                      
EDDIE GRASSER, staff to Representative Masek, said it is not the               
intent of this legislation to assist the boroughs or                           
municipalities  in assessing a property tax.  REPRESENTATIVE MASEK             
added that perhaps Senator Halford's concern could be addressed in             
a separate piece of legislation.                                               
Number 428                                                                     
JAMES DAY, representing Arctic Cat and testifying from Anchorage,              
stated support for the legislation because it will provide an                  
accurate account of snowmachine sales in the state, which is very              
important to the manufacturers.  It will also aid police forces in             
all communities in their efforts to find and return stolen                     
Number 446                                                                     
JAY DULANY, Director, Division of Motor Vehicles, Department of                
Administration, testifying from Anchorage, said he would address               
some of the questions raised during the meeting.                               
Relating to a discussion on the fee, Mr. Dulany said the fee  set              
under AS 28.10.421(d)(7) is not affected by this bill, and it is               
currently set at $10 for the biannual period.                                  
He said there is a provision in statute that allows the Division of            
Motor Vehicles to collect taxes on certain vehicles, but this class            
of vehicles is not listed in that table, so for the division to                
collect the tax there would have to be a change in the table made              
by the Legislature.                                                            
Mr. Dulany pointed out that snowmobile registrations can be renewed            
over the Internet or by telephone, so people don't have to go to               
the DMV offices.                                                               
Mr. Dulany also pointed out that it is a common practice for                   
dealerships to charge a fee for processing paperwork.                          
JIM STRATTON, Director, Division of Parks and Outdoor Recreation,              
testifying from Anchorage, said he was present to respond to                   
questions about the trail use and trail moneys that would come from            
adding increased registrations.                                                
SENATOR HALFORD pointed out that none of this money is dedicated so            
it could be used for non-motorized trail development.  MR. STRATTON            
said they would hope that when the money is authorized for trail               
use that it would come with intent on how it is to be spent.  He               
added that the money the division currently gets from the federal              
government for trails is dedicated specifically for trails and                 
there is formula that allocates that money between motorized and               
non-motorized that they do follow.  He also clarified that fuel tax            
money goes into the general fund and there is no reallocation of               
fuel tax money to the trail program.                                           
Number 506                                                                     
SENATOR WILKEN inquired if the state is losing money from the                  
National Trails funds because of the lack of registration of                   
snowmachines.  MR. STRATTON acknowledged that the state is losing              
money because the snowmobile numbers aren't as high as they should             
be.  There are about 12,000 snowmobiles registered in the state of             
Alaska, but it is estimated that up to 80,000 exist.  He said he is            
not sure how much more money the state would get if all of them                
were registered, but that question has been posed to the people who            
administer that grant money.  The division currently gets about                
$165,000 in federal highway money, and he estimated it would be                
about a 15 percent increase.                                                   
TIM BORGSTROM, representing the Anchorage Economic Development                 
Corporation and testifying from Anchorage, said the corporation has            
been looking for ways to promote winter tourism and they have                  
concluded that snowmobile recreation is an increasing and very                 
lucrative industry in roughly 28 states.  Every one of those states            
has a point of sale registration law in place which helps as a                 
funding mechanism for the development of trails to attract tourists            
to the state.                                                                  
Mr. Borgstrom said he has talked to the president of the                       
International Snowmobile Manufacturers Associations and was told               
that it is not just federal highway money that the state is losing             
out on.  The state has lost out on millions of dollars because  of             
not having a point of sale program.                                            
In his closing comments, Mr. Borgstrom related that there have been            
over 80 snowmobiles stolen within the Anchorage bowl this winter.              
With a point of sale registration, snowmobile owners would have to             
register their machines every year, get a new sticker that would be            
easily identifiable at a distance.  He said the legislation                    
provides mechanisms for money, mechanisms for law enforcement, and             
a protection and safety net for snowmobile owners.                             
There being no further witnesses to testify on HB 231, CHAIRMAN                
WARD asked Representative Masek if she had any additional comments.            
Number 554                                                                     
REPRESENTATIVE MASEK said she wanted to make it clear that this is             
not a new fee that is being initiated.  There has been a statutory             
requirement on the books since 1968 for registering snowmobiles;               
however, very few Alaskans have participated in this process and               
HB 231 makes it easier for people who want to purchase snowmachines            
in the future to comply with the requirement.  She pointed out that            
the legislation has a lot of support and she urged the committee's             
support as well.                                                               
SENATOR HALFORD asked Representative Masek if she would object to              
an option that would make it easier for people to re-register their            
machines by providing a longer period of time in between                       
registering the machine at the time of purchase and the renewal                
requirement.  He  suggested  instead of it being $10 for two years,            
it could be $20 for four years.  He said he thinks a lot of the                
objection to registration is just the contact with the bureaucracy.            
REPRESENTATIVE MASEK responded that the legislation provides for a             
mail in system for registration renewal the same as is done with               
motor vehicles.                                                                
TAPE 98-5, SIDE B                                                              
Number 587                                                                     
MR. DULANY added that he didn't see a problem with handling it                 
either way.                                                                    
SENATOR WILKEN said most of the comments he has had on this                    
legislation were good with the exception of one dealer who thought             
he didn't want the burden of the additional paperwork.  He asked if            
there was some thought of increasing the $5 yearly fee.                        
REPRESENTATIVE MASEK responded that at this time the $5 fee is                 
SENATOR WILKEN asked how the dealer will get the required signature            
to complete the paperwork if a Fort Yukon resident orders a                    
snowmachine from a Fairbanks dealer.  MR. DULANY replied that it               
could be handled in the same way that occurs now with automobile               
dealers.  When the individual is ordering the snowmachine, he can              
request that the application for the registration be faxed or                  
mailed to him.  Once the application is completed and returned the             
dealership would either register the machine or submit the                     
paperwork to the local DMV office for registration.  He added that             
before the machine can be shipped the chain of title would have to             
be complete.                                                                   
There being no further testimony on HB 231, CHAIRMAN WARD asked for            
the pleasure of the committee.                                                 
SENATOR WILKEN moved CSHB 231(FIN) and the accompanying fiscal note            
be passed out of committee with individual recommendations.                    
Hearing no objection, it was so ordered.                                       

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