Legislature(2023 - 2024)ADAMS 519
04/17/2023 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB3 | |
| HB83 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 3 | TELECONFERENCED | |
| + | HB 83 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
April 17, 2023
3:01 p.m.
3:01:24 PM
CALL TO ORDER
Co-Chair Foster called the House Finance Committee meeting
to order at 3:01 p.m.
MEMBERS PRESENT
Representative Bryce Edgmon, Co-Chair
Representative Neal Foster, Co-Chair
Representative DeLena Johnson, Co-Chair
Representative Julie Coulombe
Representative Mike Cronk
Representative Alyse Galvin
Representative Sara Hannan
Representative Andy Josephson
Representative Dan Ortiz
Representative Will Stapp
Representative Frank Tomaszewski
MEMBERS ABSENT
None
ALSO PRESENT
Representative Kevin McCabe, Sponsor; JP Cortez, Policy
Director, Sound Money Defense; Representative George
Rauscher, Sponsor; Ryan McKee, Staff, Representative George
Rauscher.
SUMMARY
HB 3 GOLD AND SILVER SPECIE AS LEGAL TENDER
HB 3 was HEARD and HELD in committee for further
consideration.
HB 83 CITIZEN ADVISORY COMM ON FEDERAL AREAS
HB 83 was HEARD and HELD in committee for further
consideration.
Co-Chair Foster reviewed the meeting agenda. He noted the
meeting would be expedited due to an upcoming meeting with
the governor.
HOUSE BILL NO. 3
"An Act relating to specie as legal tender in the
state; and relating to borough and city sales and use
taxes on specie."
3:03:44 PM
REPRESENTATIVE KEVIN MCCABE, SPONSOR, gave a brief
introduction to HB 3. He read from the sponsor statement
(copy on file) as follows:
The purpose of HB 3 is to recognize Alaska's
constitutional duty, power and right under Section 10,
Article I, of the United States Constitution, and the
Tenth Amendment of the United States Constitution to
make gold and silver legal tender in the payment of
debt.
HB 3 will secure the rights of citizens of this state
under the Ninth and Tenth Amendments of the United
States Constitution to tender gold and silver in the
payment of a debt should the merchant or payee agree
to accept it.
This bill will bring Alaska into full compliance with
the United States Constitution with the policies,
practices, and procedures of this State with respect
to the use of gold, silver, and specie as legal tender
in the payment of debt.
Representative McCabe added that 12 other states had
already passed similar legislation to accept gold and
silver coins as legal tender. Tennessee had passed its
legal tender bill in the current year and Missouri and
Minnesota would be soon hearing a version of the
legislation. As of 2022, there were 42 states that had
removed some or all of the taxes from the purchase of gold
and silver. He continued reading from the sponsor
statement:
This bill will preserve, protect, and promote the
state and its economic security, safety, health, and
welfare of the people of this state; and protect this
state and its citizens in the acquisition and
possession of gold and silver and their use as legal
tender in the payment of debt.
Representative McCabe noted that his office was working on
a modification to Article 5, Subparagraph C of the bill.
The section tasked the House Finance Committee with
studying the possibility of establishing additional forms
of legal tender for various expenses, and the change would
move that responsibility to the Legislative Budget and
Audit Committee (LB&A). The change was suggested by
Representative Hannan in the prior year and he agreed that
LB&A would be better suited for the job. He concluded his
comments and offered to
Co-Chair Foster suggested that the invited testifier speak
on the bill.
3:06:43 PM
JP CORTEZ, POLICY DIRECTOR, SOUND MONEY DEFENSE, thanked
the committee for hearing HB 3 and stated his support for
the bill. He understood that Alaska did not charge a sales
tax on purchases of goods, but boroughs and municipalities
occasionally chose to charge a sales tax. He thought that
sales taxes discouraged Alaskans who wished to own gold and
silver to protect their savings at a time of record high
inflation. The bill would ensure that there were no taxes
or disincentives to prevent Alaskans from owning the
precious metals. He reiterated that the bill would also put
Alaska in compliance with the U.S. Constitution.
Mr. Cortez continued that one of the reasons that the bill
was important was because investments were not typically
subject to sales tax. There were 42 states that had active
legislation to eliminate sales taxes from precious metals
and reaffirm gold and silver as legal tender. He relayed
that there was currently a similar bill on the Mississippi
governor's desk and once signed, it would make Mississippi
the forty-third state to pass similar legislation. He added
that Missouri and Arkansas also had bills to reaffirm gold
and silver as legal tender and the bills were anticipated
to pass within the following week. In 2023, there were 25
states that had introduced similar legislation to either
remove taxes from the purchase or from the sale of metals.
He indicated that HB 3 would also allow the state treasurer
to invest state funds in physical holdings to establish in-
state depositories. He thanked the committee for its time.
Co-Chair Foster reminded the committee that there was a
meeting with the governor in 21 minutes and he planned to
spend 15 minutes on each of the bills on the agenda.
Representative Josephson understood that Alaska was already
in compliance with the US Constitution; however, the system
to use gold and silver was simply not in place. It was an
option for the state, but the state was not in non-
compliance by not engaging in the system. He asked Mr.
Cortez if his understanding was accurate.
Mr. Cortez responded that Representative Josephson's
understanding was accurate. He indicated that one could
make the argument that taxes or impediments on using gold
and silver as legal tender were in opposition to the spirit
of the U.S. Constitution.
3:10:22 PM
Representative Ortiz asked if any other states had begun to
use gold and silver in normal transactions. He wondered if
it had created any confusion in the business world.
Mr. Cortez responded that some states had begun to use the
system. He emphasized that there was no obligation and
businesses could choose to accept or decline gold and
silver as a form of currency. There were businesses in
other states and countries that had decided to accept gold
backs as currency.
Representative Ortiz asked why there was a recent push to
establish the system in the current year as opposed to
beginning the process years ago.
Mr. Cortez responded that the world was in an unprecedented
monetary period. Advocates of gold financing had been
predicting that a time of high inflation would inevitably
arrive, and it had. He opined that paper money had been an
experiment for decades and that state treasurers,
investment groups, and citizens were "waking up" to the
realization that "paper money is just that" and it was not
as established as gold and silver.
Representative Stapp asked if capital gains would be
applicable if an individual were to purchase gold or silver
and sell it for profit in a year's time.
Mr. Cortez responded that federal gains would be applicable
but there would be no applicable state taxes because Alaska
did not have a state income tax.
3:13:53 PM
Representative Galvin asked how many decades paper money
had been an experiment.
Mr. Cortez responded it had been five decades, starting in
1971.
Representative Galvin stated her understanding that Mr.
Cortez thought that the world needed to "wake up" to the
gold and silver standard. She was also hearing from young
people that the world needed to wake up to the idea that
money was abstract and could be traded online. There seemed
to be a wide spectrum as to how money was viewed. She
wondered what the advantages would be to returning to the
gold and silver standard as opposed to using cryptocurrency
and other online monies.
Mr. Cortez responded that prior to 1971, barring the years
during which the country was involved in a world war, there
was no inflation. He thought official inflation numbers in
the present day were close to 7 percent. Individuals on
hourly wages, individuals with fixed incomes, and retirees
were most harmed by inflation. It was difficult to make
long-term plans when the economic environment was unstable.
He opined that it was easier to make long-term plans when
one could rely on a stable unit of currency that was not
being manipulated.
Representative Galvin asked for a description of the
difference between the price of oil changing, the price of
gold changing, and the inflationary costs of goods. She was
trying to understand his argument that gold bars would
eradicate inflation.
Mr. Cortez responded that from 1931 to 1971, there was a
floating exchange rate. Prior to 1931, the traditional gold
standard required that a dollar be attached to a fixed
amount of gold. There was a period of nearly 100 years
where there was no inflation in the United States. He
acknowledged that there was some movement in the price of
gold as it was a global market and one of the most liquid
markets in existence. Silver was a production metal and was
used in jewelry, cars, and other technologies and there
were industrial reasons for the movement of silver. The
difference between gold and silver was that gold was not
necessarily traded as an industrial metal.
Mr. Cortez continued that there were certain countries that
were stockpiling the available gold supply to bolster the
countries' treasuries. It was difficult for individuals to
trade commodities such as oil, but gold and silver were
generally uniform assets regardless of one's background and
nationality. He indicated that gold was a universal trading
instrument and had a fixed quantity in addition to a
longstanding history of stability. He thought it was
important that gold was mentioned in the U.S. Constitution.
He concluded that for the reasons mentioned, gold should be
placed in a different category than other commodities.
3:19:30 PM
Co-Chair Foster asked if Mr. Cortez would be available
online as a resource for future committee meetings on the
bill.
Mr. Cortez responded that he would be available.
HB 3 was HEARD and HELD in committee for further
consideration.
HOUSE BILL NO. 83
"An Act reestablishing the Citizens' Advisory
Commission on Federal Management Areas in Alaska; and
providing for an effective date."
3:20:54 PM
REPRESENTATIVE GEORGE RAUSCHER, SPONSOR, thanked the
committee for hearing HB 83. He read the sponsor statement
(copy on file):
House Bill 83 reestablishes the Citizens' Advisory
Commission on Federal Management Areas in Alaska
(CACFA), which sunset in 2021, and sets a new sunset
date of June 30, 2031. The Commission is made up of 10
public members, one Senator, and one Representative
who represent "the diversity of users and uses of
federal land in the state" and are appointed by the
Governor and Legislature.
CACFA was first established in 1981, shortly after
Congress passed the Alaska National Interest Lands
Conservation Act (ANILCA) comprehensive legislation
governing all federal public lands in the state. Under
the balanced compromise Congress crafted in ANILCA,
104+ million acres (on top of the ~100 million acres
already set aside) were set-aside in permanent federal
ownership as conservation system units (e.g., parks,
preserves, wildlife refuges, wilderness areas) while
at the same time enabling Alaskan's to maintain their
traditions, accommodate the social and economic needs
of the state, provide a range of land-use and land
access rights, safeguard opportunities for responsible
resource development, and facilitate continued
improvements in transportation and utility
infrastructure. The provisions of ANILCA plus those of
the Alaska Statehood Act and the Alaska Native Claims
Settlement Act (ANCSA) mean that most Alaskans are
regulated under a unique and extremely complex
regulatory web.
For the decades that CACFA operated, it was an
independent and impartial source of information and
center for advocacy on Statehood, ANCSA, and ANILCA
issues that impact all Alaskans. CACFA helps Alaskans
navigate complex regulations and works with federal
agencies to ensure Congressional intent is implemented
with respect to Alaska's interests. Among many things,
the Commission holds hearings to collect public
comment on decisions that affect them; disseminates
information about historical and new regulations to
the public, the Executive branch, and the Legislature;
monitors the Federal Register and regularly submits
written comment in response to actions that affect
Alaska; and helps Alaskans navigate federal permitting
processes.
While the State's ANILCA program and CACFA both
monitor federal actions, CACFA is the only entity that
represents the views of Alaskan citizens concerning
federal land management plans within the state.
The last state audit conducted in 2020 concluded that
"there is a continuing public need for the
commission." As time passes, institutional memory and
ANILCA expertise is lost at both the federal and state
level. An active CACFA is critical to ensure that this
critical knowledge is preserved, remains accessible to
Alaskans, and can be used to defend Alaska.
Furthermore, without CACFA, there is no organized
center through which individuals can channel their
concerns to the higher levels of government making
important land use decisions that impact them. CACFA
is an essential tool to ensure that Alaskans have a
strong and powerful voice in what happens in our
state.
3:25:46 PM
RYAN MCKEE, STAFF, REPRESENTATIVE GEORGE RAUSCHER, read the
sectional analysis (copy on file):
Sec 1. Amends AS 44.66.010(a) creating new
subsection (15) reestablishing the Citizens Advisory
Commission on Federal Management Areas in Alaska,
setting a new sunset date of June 30, 2031.
Sec 2. Amends AS 44.66.010(a), technical change:
Removes subsection (10) where CACFA's previous sunset
date (June 30, 2021) was listed.
Sec 3. Incorporates transition language to the
uncodified law of Alaska establishing the initial term
lengths of new appointments to the commission.
Thereafter, the term limits outlined in the
Commission's statute will take effect.
Sec 4. Sets an effective date of July 1, 2023.
Mr. McKee added that [legislative auditor] Ms. Kris Curtis
was available online to answer any questions regarding the
2020 audit mentioned in the sponsor statement.
Co-Chair Foster thought the bill might seem complicated and
he was aware that there was a lot of background information
involved in the legislation. For example, Serpentine Hot
Springs in Nome were difficult to access because it was
located within [Bering Land Bridge] National Park and all-
terrain vehicles were not allowed in the area. Elders in
particular had been experiencing difficulty accessing the
springs and historically, elders had visited the springs
frequently. He relayed that CACFA would allow the opening
of trails that fell under [federal] Revised Statute (RS)
2477, which were historical trails used by miners,
travelers, and villagers, among others. One of the concerns
he had heard was that CACFA might make private lands
vulnerable to unwanted visitors, but his understanding was
that CACFA only aimed to open federal lands, such as
national parks.
Representative Josephson thought the concerns about RS 2477
conflicts were valid. He had done research on the Klutina
Lake dispute in Wrangel and there were profound concerns
about the potential impacts of opening federal lands. His
main concern was that CACFA had a narrow perspective. The
Board of Game was entirely appointed by the governor and
Title 16 required that the governor appointment members
with reference to the diversity of users; however, he did
not think the requirement was being satisfied. On the
Department of Fish and Game's website, there was a video on
how to extradite a dog from a trap. He asked how an
individual dog owner who would like to avoid a similar
situation while walking on federal lands would have a voice
through CACFA. He thought that such an individual's voice
would be too small to be heard amid the federal outcry. He
wondered how the quiet user, such as the cross country
skier, dog walker, or backpacker, would have a voice under
CACFA.
Representative Rauscher responded that the quiet user would
have an opportunity to be heard under the bill and that it
was part of the purpose of CACFA. He thought that an
individual could always bring their concerns to CACFA and
that CACFA would make a determination. However, the
decision might not always be made in the individual's
favor.
3:32:31 PM
Co-Chair Foster reviewed the agenda for the following day's
meeting.
HB 83 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
3:33:28 PM
The meeting was adjourned at 3:33 p.m.