Legislature(2023 - 2024)BARNES 124
04/06/2023 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB70 | |
| HB69 | |
| HB123 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 70 | TELECONFERENCED | |
| += | HB 69 | TELECONFERENCED | |
| += | HB 123 | TELECONFERENCED | |
| + | TELECONFERENCED |
LASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
April 6, 2023
8:01 a.m.
DRAFT
MEMBERS PRESENT
Representative CJ McCormick, Chair
Representative Kevin McCabe, Vice Chair
Representative Tom McKay
Representative Justin Ruffridge
Representative Rebecca Himschoot
Representative Donna Mears
MEMBERS ABSENT
Representative Josiah Patkotak
COMMITTEE CALENDAR
HOUSE BILL NO. 70
"An Act relating to property exempt from municipal taxation."
- HEARD & HELD
HOUSE BILL NO. 69
"An Act relating to the reclassification of first class cities
as second class cities; and providing for an effective date."
- MOVED CSHB 69(CRA) OUT OF COMMITTEE
HOUSE BILL NO. 123
"An Act relating to an amendment to the articles of
incorporation of a corporation organized under the Alaska Native
Claims Settlement Act; and providing for an effective date."
- MOVED HB 123 OUT OF COMMITTEE
PREVIOUS COMMITTEE ACTION
BILL: HB 70
SHORT TITLE: MUNICIPAL PROPERTY TAX EXEMPTIONS
SPONSOR(s): REPRESENTATIVE(s) TOMASZEWSKI
02/13/23 (H) READ THE FIRST TIME - REFERRALS
02/13/23 (H) CRA
04/06/23 (H) CRA AT 8:00 AM BARNES 124
BILL: HB 69
SHORT TITLE: RECLASSIFICATION OF FIRST CLASS CITIES
SPONSOR(s): REPRESENTATIVE(s) CRONK
02/10/23 (H) READ THE FIRST TIME - REFERRALS
02/10/23 (H) EDC, CRA
03/01/23 (H) EDC AT 8:00 AM DAVIS 106
03/01/23 (H) Heard & Held
03/01/23 (H) MINUTE(EDC)
03/13/23 (H) EDC AT 8:00 AM DAVIS 106
03/13/23 (H) Heard & Held
03/13/23 (H) MINUTE(EDC)
03/20/23 (H) EDC AT 8:00 AM DAVIS 106
03/20/23 (H) Moved HB 69 Out of Committee
03/20/23 (H) MINUTE(EDC)
03/22/23 (H) EDC RPT 5DP 2NR
03/22/23 (H) DP: STORY, MCKAY, MCCORMICK, ALLARD,
RUFFRIDGE
03/22/23 (H) NR: HIMSCHOOT, PRAX
04/04/23 (H) CRA AT 8:00 AM BARNES 124
04/04/23 (H) Heard & Held
04/04/23 (H) MINUTE(CRA)
04/06/23 (H) CRA AT 8:00 AM BARNES 124
BILL: HB 123
SHORT TITLE: ARTICLES OF INCORPORATION FOR ANCSA CORPS
SPONSOR(s): REPRESENTATIVE(s) C.JOHNSON
03/17/23 (H) READ THE FIRST TIME - REFERRALS
03/17/23 (H) CRA
04/04/23 (H) CRA AT 8:00 AM BARNES 124
04/04/23 (H) Heard & Held
04/04/23 (H) MINUTE(CRA)
04/06/23 (H) CRA AT 8:00 AM BARNES 124
WITNESS REGISTER
REPRESENTATIVE FRANK TOMASZEWSKI
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 70.
MICHAELLA ANDERSON, Staff
Representative Frank Tomaszewski
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided an overview and the sectional
analysis on HB 70 on behalf of Representative Tomaszewski, prime
sponsor.
DAVE STANCLIFF, Staff
Representative Mike Cronk
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented HB 69 on behalf of Representative
Cronk, prime sponsor.
REPRESENTATIVE MIKE CRONK
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 69.
NILS ANDREASSEN, Executive Director
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 69.
TOM WRIGHT, Staff
Representative Craig Johnson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Re-capped HB 123 on behalf of
Representative C. Johnson, prime sponsor.
ROBERT MISULICH, General Counsel
Aleut Corporation
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 123.
SUSAN TAYLOR, CEO
St. Mary's Native Corporation
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 123.
NICHOLAS OSTROVSKY, General Counsel
Ahtna, Incorporated
Anchorage, Alaska
POSITION STATEMENT: Testified in support of HB 123.
SARAH OBED, Senior Vice President
External Affairs
Doyon, Limited
Fairbanks, Alaska
POSITION STATEMENT: Testified in support of HB 123.
ACTION NARRATIVE
8:01:17 AM
CHAIR CJ MCCORMICK called the House Community and Regional
Affairs Standing Committee meeting to order at 8:01 a.m.
Representatives McKay, Ruffridge, Himschoot, and McCormick were
present at the call to order. Representative Mears and McCabe
arrived as the meeting was in progress.
The committee took a brief at-ease at 8:03 a.m.
HB 70-MUNICIPAL PROPERTY TAX EXEMPTIONS
8:03:50 AM
CHAIR MCCORMICK announced that the first order of business would
be HOUSE BILL NO. 70, "An Act relating to property exempt from
municipal taxation."
8:04:18 AM
REPRESENTATIVE FRANK TOMASZEWSKI, Alaska State Legislature, as
prime sponsor, thanked the committee for hearing HB 70 and
introduced his staff to give an overview of the bill.
8:04:43 AM
MICHAELLA ANDERSON, Staff, Representative Frank Tomaszewski,
Alaska State Legislature, gave a brief overview of HB 70 on
behalf of Representative Tomaszewski, prime sponsor. She
paraphrased the sponsor statement [included in the committee
packet] which read as follows [original punctuation provided]:
House Bill 70 adds new language exempting non-
profits from municipal taxation on certain properties.
This includes parking lots owned by non-profits and
used for parking or other uses free of charge. This
also includes property of a store operated by a non-
profit that distributes food, shelter, clothes, or
health care for below market value or free.
Additionally, this maintains a non-profit's tax
exemption if they rent out their property to another
non-profit.
The Fairbanks Community Food Bank was founded in
1982 in the midst of a recession. People were
struggling to put food on their table, but stores had
an excess and food was going to waste. While in the
first year they collected and distributed a few
thousand pounds of food to a couple hundred people,
they now collect and distribute approximately five
million pounds of food.
Food banks and other charitable non-profits are a
pillar of our communities. They help our communities'
least fortunate when they need basic goods and
services. Of course, many nonprofits turn to
fundraising and facility rentals to keep their lights
on and doors open so they can continue to provide
their essential services.
This bill aims to support our non-profits in a
time of economic uncertainty in our state. With
revenues being down and permanent fund dividends being
cut creating a regressive tax on our least fortunate,
we must help those who help those in need.
MS. ANDERSON pointed out locations on a service map [included in
the committee packet], showing all areas the Fairbanks Community
Food Bank had assisted with "food through shipping."
8:06:38 AM
REPRESENTATIVE HIMSCHOOT asked if Representative Tomaszewski's
office had spoken with any local municipalities about the
possible impact of HB 70 on local revenue.
MS. ANDERSON replied that Representative Tomaszewski's staff
have talked to the Fairbanks North Star Borough and are
currently working with the borough on potential minor changes in
the bill language that would work better. She noted she had not
reached out to any other municipalities.
REPRESENTATIVE HIMSCHOOT questioned what the potential impacts
to education funding would be in terms of how the cap is related
to property tax.
MS. ANDERSON replied that she can provide the answer at a later
date.
REPRESENTATIVE HIMSCHOOT presumed that this would be a state
statute governing what happens at the local level while removing
some of the tax base at the local level, and she inquired about
a tax reimbursement.
MS. ANDERSON replied that staff can do research and provide the
committee with clarification at a later date.
8:08:35 AM
REPRESENTATIVE TOMASZEWSKI explained that the food bank
traditionally has had no property taxes; this would be new
revenue from the municipality.
8:09:16 AM
REPRESENTATIVE HIMSCHOOT commented that she favored local
control. She stated she will have to look into HB 70 more.
8:09:41 AM
REPRESENTATIVE RUFFRIDGE, [regarding Section 1 of HB 70, which
lists property exempt from taxation], referenced [subsection
(3)], beginning on page 2, line 16, which read:
(3) property used exclusively for nonprofit religious,
charitable, cemetery, hospital, or educational
purposes;
REPRESENTATIVE RUFFRIDGE questioned why the additional language
[proposed on page 3, line 19, through page 4, line 2] is
necessary and not covered already by subsection (3).
MS. ANDERSON replied that the intent of the added language is to
make explicit in statute that the other instances would be
exempt.
8:10:43 AM
REPRESENTATIVE MCCABE asked Representative Tomaszewski to
confirm that the City of Fairbanks is trying to tax the
foodbank, which does not make money.
REPRESENTATIVE TOMASZEWSKI responded that the food bank brings
in food donated by many organizations and gives the food away
for free.
8:12:04 AM
MS. ANDERSON clarified to Representative McCabe it is the
Fairbanks North Star Borough, not just the City of Fairbanks.
8:12:11 AM
REPRESENTATIVE MCCABE asked for clarity that the food bank does
not have any income to speak of other than what is donated to
them, but under HB 70, it would have to find a source of revenue
to pay taxes to the Fairbanks North Star Borough.
REPRESENTATIVE TOMASZEWSKI replied he did not know about income
sources; mostly [food banks] work on grants and do not generate
a lot of money.
8:13:00 AM
MS. ANDERSON gave the sectional analysis for HB 70 [included in
committee packet] which read as follows [original punctuation
provided]:
Section 1: Amends AS 29.45.0303(a) to add new
subsections (11) and (12)
(11): Adds parking lots
(A) owned by organizations incorporated
under state law being exempt under 26 U.S.C.
501(c)
(B) that is used for parking or other use
free of charge
(12): Adds real and personal property of a store
operated by organizations incorporated under
state law being exempt under 26 U.S.C. 501(c) if
the store
(A) deals with exclusively donated inventory
of food, shelter, clothes, or health care
distributed at no cost to needy individuals
(B) sells merchandise below market value to
support a literacy program or a program
providing needy persons with food, shelter,
clothes, or health care free of charge.
Section 2: Amends AS 29.45.030 to add a new subsection
(o) stating organizations exempt from (a)(11) or
(a)(12) may lease property and still qualify if
(1): the leasing organization is incorporated
under state law being exempt under 26 U.S.C.
501(c) and that organization uses the property
for an exempt activity under (a)(11) or (12)
(2): the lease payments are not the product of
the owner's main profit motive
(3): The amount charged is incidental and
reasonable for the exempt use of the property not
exceeding operational requirements for the
activity.
8:15:00 AM
REPRESENTATIVE HIMSCHOOT asked for understanding on whether it
is a local decision to tax a parking lot.
MS. ANDERSON offered her understanding it is under the
discretion of local control.
[HB 70 was held over.]
8:16:26 AM
The committee took an at-ease from 8:16 a.m. to 8:18 a.m.
HB 69-RECLASSIFICATION OF FIRST CLASS CITIES
8:18:41 AM
CHAIR MCCORMICK announced that the next order of business would
be HOUSE BILL NO. 69, "An Act relating to the reclassification
of first class cities as second class cities; and providing for
an effective date."
8:19:00 AM
VICE CHAIR MCCABE moved to adopt the proposed committee
substitute (CS) for HB 69, Version 33-LS0407\B, Dunmire, 4/4/23,
as a working document.
8:19:15 AM
CHAIR MCCORMICK objected for the purpose of discussion and
explanation of changes.
8:19:45 AM
DAVE STANCLIFF, Staff, Representative Mike Cronk, Alaska State
Legislature, on behalf of Representative Cronk, prime sponsor of
HB 69, explained that the Local Boundary Commission had a recent
meeting to discuss matters as HB 69 moves forward, and two
issues came to mind. They wanted time to develop a better
system of treating communities that fall below the 400
threshold, and there was an agreement for a two-year sunset to
allow the commission to internally deal with this at its level
so the legislature can "stay out of their business." The Local
Boundary Commission also explained that it takes time to give
public notice and pull a meeting together and get a 10-day
interval to notify communities; the commission asked for 60
days, but 30 days was agreed upon.
8:21:01 AM
CHAIR MCCORMICK removed his objection to the motion to adopt the
proposed committee substitute (CS) for HB 69, Version 33-
LS0407\B, Dunmire, 4/4/23, as a working document. There being
no further objection, Version B was before the committee. He
gave the bill sponsor the opportunity to add any closing
comments.
8:21:31 AM
REPRESENTATIVE MIKE CRONK, Alaska State Legislature, as prime
sponsor of HB 69, commented that the bill had been written for
the City of Tanana, but mainly for the students in the Tanana
City School District. He noted it has been an improvement for
the community now that the Tanana City School District is under
contract with the Yukon-Koyukuk School District.
8:22:10 AM
CHAIR MCCORMICK opened public testimony on HB 69.
8:22:41 AM
NILS ANDREASSEN, Executive Director, Alaska Municipal League,
gave testimony in support of HB 69, and explained that the bill
would offer an expedited process for local governments to
reclassify from first to second class, resulting in improved and
strengthened local control.
8:23:13 AM
CHAIR MCCORMICK, after ascertaining that no one else wished to
testify, closed public testimony on HB 69. He entertained a
motion to move the bill out of committee.
8:23:34 AM
REPRESENTATIVE MCCABE moved to report CSHB 69, Version 33-
LS0407\B, Dunmire, 4/4/23 out of committee with individual
recommendations and the accompanying zero fiscal notes. There
being no objection, CSHB 69(CRA) was reported from the House
Community and Regional Affairs Standing Committee.
HB 123-ARTICLES OF INCORPORATION FOR ANCSA CORPS
8:24:00 AM
CHAIR MCCORMICK announced that the final order of business would
be HOUSE BILL NO. 123, "An Act relating to an amendment to the
articles of incorporation of a corporation organized under the
Alaska Native Claims Settlement Act; and providing for an
effective date."
8:24:14 AM
TOM WRIGHT, Staff, Representative Craig Johnson, Alaska State
Legislature, re-capped HB 123 on behalf of Representative C.
Johnson, prime sponsor. He explained that HB 123 would bring
the Alaska Native Claims Settlement Act (ANCSA) in line with the
Alaska Corporations Code wherein those who formed a corporation
after 1989 are allowed to have a 50 percent plus one threshold
for amendments to the articles of corporation; the bill would
eliminate the two-thirds threshold corporations are currently
under.
8:25:05 AM
CHAIR MCCORMICK opened public testimony on HB 123.
8:25:27 AM
ROBERT MISULICH, General Counsel, Aleut Corporation, testified
in support of HB 123, which addresses the important issue of the
voting threshold for an Alaska Native corporation to amend its
articles of incorporation through a simple majority vote of the
outstanding voting shares.
8:27:11 AM
SUSAN TAYLOR, CEO, St. Mary's Native Corporation, testified in
support of HB 123, noting that Mr. Misulich had covered all the
points she had planned to make.
8:27:58 AM
NICHOLAS OSTROVSKY, General Counsel, Ahtna, Incorporated,
testified in support of HB 123. He stated the bill would bring
Native corporations in line with modern corporations code, and
it would help Native corporations be more agile, efficient, and
continue with the important mission to provide economic and
social benefits for Alaska Native shareholders.
8:28:43 AM
SARAH OBED, Senior Vice President, External Affairs, Doyon,
Limited, testified on behalf of the ANCSA Regional Association
(ARA) in support of the passage of HB 123. She stated that ARA
and the member organizations are tasked with providing for their
Alaska Native shareholders socially, culturally, and
economically. She noted the current two-thirds majority
requirement is an outdated rule, and a hurdle. She thanked the
committee for its work on behalf of Alaska and the consideration
of this legislation.
8:31:56 AM
CHAIR MCCORMICK, after ascertaining that there was no one else
who wished to testify, closed public testimony on HB 123.
8:32:26 AM
CHAIR MCCORMICK entertained a motion to move HB 123 from
committee.
8:32:33 AM
REPRESENTATIVE MCCABE moved to report HB 123 out of committee
with individual recommendations and the accompanying zero fiscal
note. There being no objection, HB 123 was reported out of the
House Community and Regional Affairs Standing Committee.
8:33:26 AM
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 8:33 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 70 Fiscal Note CCED.pdf |
HCRA 4/6/2023 8:00:00 AM HCRA 4/13/2023 8:00:00 AM |
HB 70 |