Legislature(2003 - 2004)

04/29/2003 01:46 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  HOUSE FINANCE COMMITTEE                                                                                       
                       April 29, 2003                                                                                           
                          1:46 PM                                                                                               
TAPE HFC 03 - 69, Side A                                                                                                        
TAPE HFC 03 - 69, Side B                                                                                                        
TAPE HFC 03 - 70, Side A                                                                                                        
CALL TO ORDER                                                                                                                 
Co-Chair Williams called the House  Finance Committee meeting                                                                   
to order at 1:46 PM.                                                                                                            
MEMBERS PRESENT                                                                                                               
Representative John Harris, Co-Chair                                                                                            
Representative Bill Williams, Co-Chair                                                                                          
Representative Kevin Meyer, Vice-Chair                                                                                          
Representative Mike Chenault                                                                                                    
Representative Richard Foster                                                                                                   
Representative Mike Hawker                                                                                                      
Representative Bill Stoltze                                                                                                     
Representative Reggie Joule                                                                                                     
Representative Jim Whitaker                                                                                                     
MEMBERS ABSENT                                                                                                                
Representative Eric Croft                                                                                                       
Representative Carl Moses                                                                                                       
ALSO PRESENT                                                                                                                  
Representative   Gutenberg;  Representative   Peggy   Wilson;                                                                   
Representative Tom  Anderson, Sponsor, Rynnieva  Moss, Staff,                                                                   
Representative Coghill;  Kelly Hepler, Director,  Division of                                                                   
Sport Fish, Department of Fish  and Game; Jeff Cook Williams,                                                                   
Vice  President, Williams  Company;  Mark  Smith, Yukon  Fuel                                                                   
Company,  Anchorage; Jim  Boltz, Petro  Star Refinery;  Bryan                                                                   
Butcher,   Legislative   Liaison,  Alaska   Housing   Finance                                                                   
Corporation;   Mary  Francis,   Executive  Director,   Alaska                                                                   
Council of  School Administrators;  Laura Glasier,  Director,                                                                   
Division  of   Elections;  Sarah  Felix   Assistant  Attorney                                                                   
General, Department of Law.                                                                                                     
PRESENT VIA TELECONFERENCE                                                                                                    
Jim  McMillian,   Deputy  Director,  Credit,   Department  of                                                                   
Community  and Economic  Development; Steve  Van Sant,  State                                                                   
Assessor;  Byron Haley,  President of  the Chitina  Dipnetter                                                                   
Association,  Fairbanks; Dick  Bishop, Fairbanks; Mark  Helm,                                                                   
Vice   President,   Chitina  Dipnetters   Association;   Paul                                                                   
Holland,   Board   Members   of    the   Chitina   Dipnetters                                                                   
Association,  Fairbanks; Jesse  VanderZanden, Alaska  Outdoor                                                                   
Council;  Justin Charon,  Yukon  Fuel; Tim  Beck,  Fairbanks;                                                                   
Merrick Pierce, Fairbanks; Paul Barrett, Fairbanks.                                                                             
HB 210    "An Act  relating to  the Chitina dip  net fishery;                                                                   
          and providing for an effective date."                                                                                 
          HB 210 was heard and HELD in Committee for further                                                                    
HB 216    "An Act  relating to municipal taxation  of refined                                                                   
          fuel products."                                                                                                       
          HB 216 was HELD in Committee for further                                                                              
HB 266    "An Act  relating to elections,  questioned ballots                                                                   
          and   questioned   voters,    voter   registration,                                                                   
          training  of  election  officials,  preparation  of                                                                   
          election materials,  voter identification, absentee                                                                   
          voting,   counting   ballots,   and   the   primary                                                                   
          election; and providing for an effective date."                                                                       
          CSHB 266  (FIN) was REPORTED out of  Committee with                                                                   
          a  "do pass"  recommendation  and  two zero  fiscal                                                                   
          notes:   #1 from the Office of the  Governor and #2                                                                   
          from the Department of Administration.                                                                                
CSSB 25(FIN)                                                                                                                    
          "An  Act relating to  the acquisition  of teachers'                                                                   
          housing  by regional  educational attendance  areas                                                                   
          and  to  teachers'  housing loan  programs  in  the                                                                   
          Alaska Housing  Finance Corporation;  and providing                                                                   
          for an effective date."                                                                                               
          HCSSB 25  (HES) was REPORTED out of  Committee with                                                                   
          a  "do pass"  recommendation  and  one zero  fiscal                                                                   
          note from the Department of Revenue.                                                                                  
CS FOR SENATE BILL NO. 25(FIN)                                                                                                
     "An  Act  relating  to  the   acquisition  of  teachers'                                                                   
     housing by regional educational  attendance areas and to                                                                   
     teachers'  housing loan programs  in the Alaska  Housing                                                                   
     Finance  Corporation;  and  providing for  an  effective                                                                   
SENATOR GARY  WILKEN, SPONSOR provided information  about the                                                                   
bill.  He explained that the bill  allow teachers to take out                                                                   
zero  down payment  loans under  the  Alaska Housing  Finance                                                                   
(AFHC).  He noted that this was  in conjunction with programs                                                                   
such  as the  first time  homebuyer program,  with a  similar                                                                   
interest  rate through  AHFC.   He noted that  a Senate  bill                                                                   
passed,  which  allows  REAA  [Rural  Educational  Attendance                                                                   
Areas] school  districts to construct, own and  manage rental                                                                   
housing for teachers.    He stated that public  elementary or                                                                   
secondary  school  teachers  would   be  eligible,  including                                                                   
therapists, nurses and school  librarians, who must possess a                                                                   
certificate from  the Department of Education.   Restrictions                                                                   
include using the  program only once, and that  the home must                                                                   
be  owner occupied  and be  a single-family  home, and  agree                                                                   
with all  AHFC credit  criteria.  The  sponsor added  a five-                                                                   
year sunset in order to evaluate the program's success.                                                                         
Senator  Wilkins stated  that the bill  is about  recruitment                                                                   
and retention,  a tool to  attract qualified teachers  to the                                                                   
state.  He pointed out that the  Alaska Association of School                                                                   
Boards had  written in support  of the  bill.  He  noted that                                                                   
Representative  Bunde  had  written  an  editorial  piece  in                                                                   
October asking for relief for  Alaska teachers' housing.  The                                                                   
Anchorage  school district requested  legislation to  provide                                                                   
housing relief,  as well as  The Alaska Statewide  Educators'                                                                   
Supply  and Demand Report  highlighted  the need for  teacher                                                                   
housing.    On  a  national  basis,  the  "no  dream  denied"                                                                   
publication  speaks of  how districts  across the nation  are                                                                   
attracting good teachers by providing affordable housing.                                                                       
In   regard  to   other  state   programs,  Senator   Wilkins                                                                   
highlighted  these  examples:   Oregon  is  offering  signing                                                                   
bonuses  to retain  teachers;  California  is offering  large                                                                   
bonuses  for advanced  teachers;  New  Mexico  is offering  a                                                                   
signing bonus.   He explained that the bill  allows a teacher                                                                   
to  come to  Alaska  and buy  into  the "American  dream"  of                                                                   
owning a  home.  He pointed  out that registered  nurses were                                                                   
added in the House and that he supports that amendment.                                                                         
Representative  Hawker expressed  his support  for the  bill.                                                                   
He  asked  why  administrators  were included  in  the  bill.                                                                   
Senator Wilken  speculated that  school districts  might need                                                                   
to hire administrators from other  states and that this would                                                                   
be a way to attract quality administrators.                                                                                     
Representative  Hawker commented  that administrators  seemed                                                                   
to  be plentiful.    Senator Wilken  noted  that  they had  a                                                                   
difficult time looking for a Commissioner  for the Department                                                                   
of Education and Early Development.                                                                                             
Co-Chair Harris  observed that  the legislation was  intended                                                                   
to make  a home available to  teachers with no  down payment.                                                                   
He asked what happened if they  ceased to teach, whether they                                                                   
kept the  home.   Senator Wilken  speculated that they  would                                                                   
keep  their mortgage.   Co-Chair  Harris asked  if the  homes                                                                   
would be  owned by  an REAA.   Senator  Wilken referred  to a                                                                   
previous   bill    that   gave   government    entities   and                                                                   
municipalities a  way to build multi-family housing  in rural                                                                   
Alaska.  He  explained that the current bill  carried this to                                                                   
the REAA's  as long  as no state  foundation monies  are used                                                                   
and   teachers  qualify   for  an   Alaska  Housing   Finance                                                                   
Corporation loan.                                                                                                               
BRYAN BUTCHER,  LEGISLATIVE LIAISON,  ALASKA HOUSING  FINANCE                                                                   
CORPORATION confirmed that the  main advantage to the initial                                                                   
purchase was  the absence  of a down  payment.  He  explained                                                                   
that  should the  house be  resold,  it would  then become  a                                                                   
regular  mortgage.   In response  to a  question by  Co-Chair                                                                   
Harris,  Mr.  Butcher  confirmed   that  the  mortgage  would                                                                   
function as a regular loan through AHFC.                                                                                        
Representative Croft asked how  the fiscal note could be zero                                                                   
if there  was a no down  payment loan and potential  defaults                                                                   
might  then represent  a  cost  to the  State.   Mr.  Butcher                                                                   
conceded  that  there  would  be  a  minimal  increased  risk                                                                   
associated with  no down payment.   He also pointed  out that                                                                   
the  stability  of  teachers  and  mortgage  insurance  would                                                                   
mitigate   the  risk.     In  response   to  a  question   by                                                                   
Representative  Croft, Mr. Butcher  noted that if  there were                                                                   
an unforeseen  problem  the program would  be re-examined  in                                                                   
five years at its sunset.                                                                                                       
MARY FRANCIS,  EXECUTIVE DIRECTOR,  ALASKA COUNCIL  OF SCHOOL                                                                   
ADMINISTRATORS  testified  in  support  of  the  bill.    She                                                                   
explained   that   the   Council    represents   all   school                                                                   
administrators  in the state.   She  pointed out that  Alaska                                                                   
was facing a  shortage in school administrators,  in addition                                                                   
to teachers.  She stated that  the Council viewed the bill as                                                                   
a positive step toward providing  incentives for professional                                                                   
educators to live  and work in Alaska.  She  noted that other                                                                   
states  had  also provided  benefits  to  attract  educators,                                                                   
including  exemption  from  state income  taxes  and  singing                                                                   
bonuses.  She maintained that  Alaska must compete with these                                                                   
incentives  at a  time when  fewer people  were choosing  the                                                                   
teaching profession.                                                                                                            
Representative  Stoltze  asked  what the  average  salary  of                                                                   
school superintendents was in  Alaska.  Ms. Francis responded                                                                   
that  the administrators  make  more  than $50  thousand  per                                                                   
year, and  offered to  provide more  specific information  in                                                                   
the future.   She  indicated that  it was  difficult to  hire                                                                   
school principles in the state.                                                                                                 
REPRESENTATIVE  PEGGY  WILSON  spoke  to  the  provision  for                                                                   
nurses.  She indicated that the  nursing profession currently                                                                   
had  an 11.5  percent  vacancy  rate.   She  stated that  the                                                                   
health care industry  was one of the state's  fastest growing                                                                   
industries, projecting  a need for  4,100 nurses in  the next                                                                   
seven  years.  She  stated that  the bill  would give  nurses                                                                   
another incentive  to move to  Alaska, and thereby  prevent a                                                                   
potential  health care crisis  in the  state.  She  expressed                                                                   
her support of the bill.                                                                                                        
Representative Stoltze asked for  a definition of nurses.  He                                                                   
asked  if home  care  providers would  be  eligible for  this                                                                   
benefit.  Representative  Wilson explained that  to qualify a                                                                   
nurse  must be  registered.   In  response to  a question  by                                                                   
Representative  Stoltze,  Representative   Wilson  speculated                                                                   
that the  type of nurse or  their job did not  affect whether                                                                   
they qualified  for the benefit.   The state needs  nurses of                                                                   
all types.                                                                                                                      
Representative Foster  MOVED to report HCS CSSB  25 (HES) out                                                                   
of Committee with the accompanying  fiscal note.  There being                                                                   
NO OBJECTION it was so ordered.                                                                                                 
HCS CSSB  25 (HES) was REPORTED  out of Committee with  a "do                                                                   
pass"  recommendation  and  one  zero fiscal  note  from  the                                                                   
Department of Revenue.                                                                                                          
HOUSE BILL NO. 210                                                                                                            
     "An Act relating to the Chitina dip net fishery; and                                                                       
     providing for an effective date."                                                                                          
RYNNIEVA   MOSS,  STAFF,   REPRESENTATIVE  COGHILL   provided                                                                   
information about  the bill.   She noted  that a bill  in the                                                                   
last legislative  session would have extended  the $25 permit                                                                   
for Chitina  dipnetting  and then  phased it  out.  She  read                                                                   
from minutes of the Senate Resources  Committee in that year,                                                                   
when Senator  Wilkins stated that  his intent was to  have an                                                                   
accessible, productive  and safe  fishery, and that  he could                                                                   
support a continuation  of the fee knowing that  it would end                                                                   
in the  following year, passing  administration along  to the                                                                   
State and [Native] Corporations.   She noted that since then,                                                                   
there had been a survey of lands in the Chitina River area.                                                                     
Ms. Moss referred to a map outlining  the area referred to in                                                                   
the  bill, indicating  both public  and private  lands.   She                                                                   
stated  that  approximately  60  percent of  the  lands  were                                                                   
public  access.    She  noted that  the  survey  indicated  a                                                                   
monument  every 2/10  mile and  explained  that $50  thousand                                                                   
remained  of the  survey  monies to  produce  a brochure  for                                                                   
anyone  applying  a permit,  indicating  public  and  private                                                                   
land. The  bill does  not eliminate  the permit process,  but                                                                   
only the $25 fee.                                                                                                               
Ms. Moss  addressed the fiscal  note, which indicated  a loss                                                                   
of  $170  thousand  in  revenues.    She  explained  how  the                                                                   
Department  used this  funding, and noted  that the  original                                                                   
note indicated a $181 thousand  loss.  The trespass fees paid                                                                   
to   native   corporations   totaled   $130,536;   the   site                                                                   
maintenance  totaled another  $36 thousand.    She  concluded                                                                   
that the Department  was actually losing only  $2 per permit,                                                                   
less the cost of printing the  permits, which totaled $3,600.                                                                   
She pointed out that the bill  presented no major loss to the                                                                   
general fund.                                                                                                                   
Ms. Moss explained that in the  Spring the Fish Board changed                                                                   
the classification of fishing  in Chitina from subsistence to                                                                   
"personal  use",  which would  require  a $15  sport  fishing                                                                   
license, above  the fish netting permit.   Estimates indicate                                                                   
that ten  percent of  fishers were  now required to  purchase                                                                   
sports fishing  licenses and that  under the bill,  providing                                                                   
$11 thousand additional revenue  to the State. She also noted                                                                   
estimates  that  a potential  of  3,000  additional  licenses                                                                   
would be  purchased, totaling  $45 thousand  in new  revenue.                                                                   
She   indicated  that   this   revenue   could  support   the                                                                   
maintenance  issue surrounding  the  bill.   She stated  that                                                                   
Representative  Coghill believes that  the funding  should be                                                                   
found through  other efficiencies and treated  as an existing                                                                   
maintenance  expense.    She pointed  out  that  the  Chitina                                                                   
dipnetters  were the only  fisheries in  the state  of Alaska                                                                   
that was paying for permits.                                                                                                    
Representative Chenault  asked if Chitina dipnetting  was the                                                                   
only fishery to subsidize waste  disposal through a fee.  Ms.                                                                   
Moss confirmed that  this was true, but added  that the Kenai                                                                   
dipnetting area  had a municipal  charge for waste  disposal.                                                                   
In response  to a  question by  Representative Chenault,  Ms.                                                                   
Moss  replied that  the benefit  did  not go  to the  fishers                                                                   
Co-Chair Harris  asked if Atna [Native Corporation]  land was                                                                   
used to access the river.  Ms.  Moss stated that the brochure                                                                   
would  clearly  detail public  and  private access,  so  that                                                                   
there would  be no reason to  use private property  to access                                                                   
the river. In response to a question  by Co-Chair Harris, Ms.                                                                   
Moss  confirmed that  the only  action was  to eliminate  the                                                                   
Representative  Croft  referred   to  the  fiscal  note,  and                                                                   
observed an average of 7,000 people  to whom a fee of $25 was                                                                   
charged  generated  approximately  $180 thousand  in  revenue                                                                   
that the State  would no longer be received.   Ms. Moss noted                                                                   
that all of the $2 per permit  was being directed to services                                                                   
other than the Department of Fish and Game.                                                                                     
Representative Croft  observed that the  fee went to  pay for                                                                   
the  agreement with  Atna.  To use  their  private lands  for                                                                   
access  and asked  if the  sponsor proposed  that the  access                                                                   
would  no  longer  be  paid  for  or  available.    Ms.  Moss                                                                   
confirmed  that this  was correct  and added  that the  State                                                                   
would no longer pay for waste management in the area.                                                                           
Co-Chair  Harris asked  if outdoor  plumbing  would still  be                                                                   
maintained,  since this  was a  popular fishing  area in  the                                                                   
State.   Ms. Moss responded that  this issue was  still under                                                                   
consideration and that separate  legislation was being worked                                                                   
on to address the issue.  She  added Representative Coghill's                                                                   
belief  that  the Department  of  Transportation  and  Public                                                                   
Facilities  and  the  Department  of  Fish  and  Game  should                                                                   
collaborate to equitably address  this issue.  She noted that                                                                   
their  office was  communicating  with various  agencies  and                                                                   
organizations to resolve the problem.                                                                                           
Representative  Croft concurred with  Co-Chair Harris  in the                                                                   
concern  for  locating  general  funds  to  provide  restroom                                                                   
facilities and other services.   He agreed that the fee might                                                                   
be reduced, but maintained that  even given a clear brochure,                                                                   
without legal  access through private lands,  border disputes                                                                   
might arise, in  addition to problems with waste  disposal if                                                                   
facilities were  not available.   He suggested that  Fish and                                                                   
Game might at  least find funding to provide  these services.                                                                   
Co-Chair Williams  recalled that  the reason the  statute was                                                                   
initiated was  to prevent crossing  of private  Native lands.                                                                   
He asked how the Committee might address this.                                                                                  
Representative Stoltze  observed that there had  been a great                                                                   
deal of  resources spent  in delineating  the property  lines                                                                   
and access points.                                                                                                              
Co-Chair  Williams   recalled  that  originally   there  were                                                                   
private property signs on the  roadways. Ms. Moss stated that                                                                   
the reason  to keep  the permit,  while eliminating  the fee,                                                                   
was to provide information to  every person fishing outlining                                                                   
the  property lines  between  state and  private  land.   She                                                                   
noted that trespassers stood the  chance of being prosecuted.                                                                   
Representative  Stoltze expressed  his  support of  repealing                                                                   
the  fee,  in that  it  was inappropriate  to  provide  these                                                                   
services  through the  use of  fees. He  maintained that  the                                                                   
Department  of  Transportation   and  Public  Facilities  had                                                                   
plenty  of opportunity  to provide  services  apart from  the                                                                   
permit process.  He noted regulatory  power to set up charges                                                                   
for  use   of  facilities,  and   stated  that  it   was  not                                                                   
appropriate  to charge  fees in correlation  with the  permit                                                                   
Ms. Moss  noted that  at the last  hearing the Department  of                                                                   
Fish and Game stated that they  could use proceeds from sport                                                                   
fishing licenses to provide maintenance of this kind.                                                                           
Representative Joule asked to hear public testimony.                                                                            
Co-Chair Harris asked  if they had received  any comment from                                                                   
the Native Corporation.  Ms. Moss said they had not.                                                                            
The  Glennallen Legislative  Information  Office stated  that                                                                   
written testimony  from Joseph  Hart, General Manager  of the                                                                   
Chitina Native Corporation had been faxed (copy on file).                                                                       
Representative  Foster pointed  out that  many areas  provide                                                                   
their own  maintenance without  state assistance just  out of                                                                   
pride for  their area.   He  gave the  example that  in Nome,                                                                   
citizens provided cleanup on a volunteer basis.                                                                                 
BYRON HALEY, PRESIDENT OF THE  CHITINA DIPNETTER ASSOCIATION,                                                                   
FAIRBANKS,  testified via  teleconference in  support of  the                                                                   
bill.  He stated that Chitina  was the corridor to fishing in                                                                   
the  area,  and maintained  that  a  $25  fee was  no  longer                                                                   
necessary.  He  referred to a letter from the  Departments of                                                                   
Natural  Resources  and Fish  and  Game  in August  of  2002,                                                                   
stating  that the  current  yearly compensation  process  has                                                                   
been difficult  and that  given the  recent survey  and other                                                                   
developments, they do not believe  that the fee is any longer                                                                   
necessary.   He  stressed that  the  private landowner  could                                                                   
still  choose to charge  for access  to their  property.   He                                                                   
strongly encouraged passage of the legislation.                                                                                 
DICK  BISHOP,  FAIRBANKS,  testified  via  teleconference  in                                                                   
support of the bill.  He expressed  thanks to legislators for                                                                   
their work  on the bill  over the years.   He explained  that                                                                   
the  Chitina  Dipnet  industry   was  for  personal  use  and                                                                   
required a  sports fishing  license as a  result of  a recent                                                                   
Board  of  Fisheries  decision.   He  maintained  that  there                                                                   
should be no need for an additional  fee to allow Alaskans to                                                                   
fish  for  food in  that  fishery  and  pointed out  that  no                                                                   
additional  fee  was  charged  for  any  other  personal  use                                                                   
fishery in the state.                                                                                                           
TAPE HFC 03 - 69, Side B                                                                                                      
Mr. Bishop pointed  out that the Native Corporation  was free                                                                   
to charge fees for trespass on their lands as they saw fit.                                                                     
Co-Chair Harris referred  to a letter faxed  from the Chitina                                                                   
Native  Corporation  concerning  trespass  and  cutting  down                                                                   
trees.  He asked  if there was a way to relieve  the concerns                                                                   
of the Native Corporation regarding  activity on their lands.                                                                   
He suggested that if the state  had clearly delineated access                                                                   
to  state  lands,  there  was  a way  to  allay  fears  about                                                                   
Mr. Bishop related a story about  an individual who purchased                                                                   
land  near a  well-used  trail, and  had  not posted  private                                                                   
property  signs indicating  that he  did not  wish people  to                                                                   
trespass.  He  indicated that the private landowners  had the                                                                   
responsibility  to  convey  their wishes  through  signs  and                                                                   
notices, in  the hope  that most  people would respect  those                                                                   
MARK HELM,  VICE PRESIDENT,  CHITINA DIPNETTERS  ASSOCIATION,                                                                   
testified  via teleconference  in support  of the  bill.   He                                                                   
referred to the  map of the surveyed area, sheet  2 of 5, and                                                                   
highlighted  Mile Post  One.   He  indicated  that there  was                                                                   
public access  from that  point to  Milepost 60.62  (GPSO 2).                                                                   
He noted  that from  Milepost  .40 to Milepost  2.21 was  the                                                                   
origination  of  the  trespass  fee eleven  years  ago.    He                                                                   
pointed  out  that  at  that  time,  public  access  was  not                                                                   
available in this area; the state  has now repaired the road,                                                                   
and provided public access.  He  noted that he has operated a                                                                   
fishing  charter for the  past twenty  years, and  maintained                                                                   
that there was little access by  the public in this area, and                                                                   
therefore  not  much  trespassing.     He  stated  that  most                                                                   
dipnetters  fished in  the area  from Milepost  2.39 down  to                                                                   
Haley  Creek.   He maintained  that  percentage figures  were                                                                   
misleading.   He also referred to  the last page of  the map,                                                                   
and stated  that the potential  trespass area was  actually a                                                                   
dangerous cliff,  where no one  fished.  He proposed  that in                                                                   
the current  circumstances,  the trespass  fee was no  longer                                                                   
valid.   He pointed out that  the Native Corporation  did not                                                                   
pay to survey the land.                                                                                                         
PAUL  HOLLAND,  BOARD  MEMBERS   OF  THE  CHITINA  DIPNETTERS                                                                   
ASSOCIATION,  FAIRBANKS,  testified   via  teleconference  in                                                                   
support of the  bill.  He stated that the majority  of dipnet                                                                   
fisherman  fished within  the right  of way.   He also  noted                                                                   
that the  road was  closed at  the present  time, making  the                                                                   
issue of trespass moot at this point.                                                                                           
JESSE  VANDERZANDEN, ALASKA  OUTDOOR  COUNCIL, testified  via                                                                   
teleconference  in support  of  the bill.    He stated  that,                                                                   
according to  the recent survey,  at least 60 percent  of the                                                                   
area  used by  dipnetters was  public  land.   He also  noted                                                                   
identified  public access to  the area.   He maintained  that                                                                   
the trespass  fee was no  longer valid.   He referred  to two                                                                   
letters  provided   as  testimony  to  the   House  Resources                                                                   
Committee.    He quoted  from  a  letter from  Governor  Tony                                                                   
Knowles  to the  Chitina  Native Corporation,  stating  "last                                                                   
summer  DOT/PF  staff  completed  this  legislatively  funded                                                                   
survey which showed that at least  60 percent of the right of                                                                   
way  between O'Brien  and Haley  Creek  affords legal  public                                                                   
access to  the Copper River."   The letter  went on  to state                                                                   
that "  the results of  this survey places  the state  in the                                                                   
awkward position  of collecting fees from a  portion of users                                                                   
in the Chitina  subsistence fisheries to pay  for access that                                                                   
is  not needed  in  order  to  participate in  the  fishery".                                                                   
Finally,  he read,  "ADF&G  is  considering a  proposal  that                                                                   
would  repeal the  access  fee".   He  then  quoted from  the                                                                   
letter by  quoted earlier by Mr.  Haley.  He  maintained that                                                                   
the  current bill  was a  win/win situation  for both  public                                                                   
access  fishers  and  private  landowners.    He  noted  that                                                                   
private  landowners benefited  from  information provided  to                                                                   
the  public by  state agencies  on the  delineation of  their                                                                   
lands.   He emphasized that  private landowners  could choose                                                                   
to  charge fees  for trespass.    He also  stressed that  the                                                                   
Department  of Fish and  Game should  not be responsible  for                                                                   
trash  and  waste  removal  contracts.    He  submitted  that                                                                   
discussion about  cleanup should  not be a legislative  issue                                                                   
but rather a regulatory one.                                                                                                    
HB  210  was   heard  and  HELD  in  Committee   for  further                                                                   
HOUSE BILL NO. 266                                                                                                            
     "An Act  relating to  elections, questioned  ballots and                                                                   
     questioned  voters,  voter   registration,  training  of                                                                   
     election officials,  preparation of election  materials,                                                                   
     voter   identification,    absentee   voting,   counting                                                                   
     ballots, and the primary  election; and providing for an                                                                   
     effective date."                                                                                                           
Co-Chair  Harris MOVED  to ADOPT  Committee Substitute  (FIN)                                                                   
Work Draft 23-GH1133\S,  4/29/03.  There being  NO OBJECTION,                                                                   
the Work Draft was ADOPTED.                                                                                                     
LAURA  GLAISER,  DIRECTOR,  DIVISION  OF  ELECTIONS  provided                                                                   
information  about the  changes  contained  in the  Committee                                                                   
Substitute.   She explained that  the intent of the  bill was                                                                   
to  address  compliance  with  the  Help  American  Vote  Act                                                                   
(HAVA), signed  into law in October  of 2002.  The  law was a                                                                   
result  of  a bi-partisan  effort  in  Congress  intended  to                                                                   
improve   overall  administration   of  elections,   increase                                                                   
accessibility  to voters with  disabilities and  reduce voter                                                                   
fraud.  She  continued to read from the Sponsor  Statement as                                                                   
     Many  changes   required  under  HAVA  do   not  require                                                                   
     amending  Alaska  statute,  but HB  266  includes  those                                                                   
     necessary   to   meet   federal   mandates.      Changes                                                                   
     recommended in the bill before  you follow the intent of                                                                   
     the federal law and do not  place unnecessary burdens on                                                                   
     the  voter.    It  is  imperative   that  these  changes                                                                   
     mandated by  federal law  are passed by the  Legislature                                                                   
     this year.                                                                                                                 
     HB 266  also includes  changes the Division  recommends.                                                                   
     The  Division  supports   the  language  recommended  in                                                                   
     Senator  Lincoln's SB 24,  and it  had been included  in                                                                   
     this bill with her permission.   Other changes regarding                                                                   
     returning    identification/voter    cards   to    other                                                                   
     jurisdictions, reference  to a "master list", and adding                                                                   
     types of information  that can be provided  by the voter                                                                   
     when  registering   in  person  are  requested   by  the                                                                   
     Division in this bill.                                                                                                     
Ms. Glaiser  stated that, although  not mandated to do  so by                                                                   
federal   law,   the  Division   had   recommended   grouping                                                                   
"undeclared" and "non-partisan"  voters into one group called                                                                   
"unaffiliated   voters".    She   stated  that   the  current                                                                   
Committee Substitute (Version  S) had removed those sections.                                                                   
She  also noted  that  in the  original  version, the  phrase                                                                   
"question ballot"  had been changed to  "provisional ballot".                                                                   
House State  Affairs had  recommended  reverting back  to the                                                                   
term "question  ballot".  In  addition, federal law  asks the                                                                   
Division to provide a free access  system, whether a web site                                                                   
or toll  free number, by  which a voter  may check to  see if                                                                   
their  question  ballot  had been  counted.    Currently  the                                                                   
practice  is   to  send  a   letter  to  those   voters,  and                                                                   
Representative  Gruenberg   requested  that  the   letter  be                                                                   
included along with the free access  system.  She stated that                                                                   
both methods are included in the Committee Substitute.                                                                          
Representative Croft  asked why combining  "non-partisan" and                                                                   
"undeclared"  into "nonaffiliated"  was not  included in  the                                                                   
bill.     Ms.  Glaiser  responded   that  it  was   a  policy                                                                   
recommendation,  but there  was  no federal  mandate.     She                                                                   
referred  to   the  Sectional  Analysis  of   the  bill  that                                                                   
indicated   which  measures  were   housekeeping  and   which                                                                   
responded to federal compliance.                                                                                                
Representative  Croft asked about  the language contained  in                                                                   
Section 17  of Representative  Lincoln's bill  (SB 24).   Ms.                                                                   
Glaiser responded  that SB 24,  as well as the  current bill,                                                                   
requested   that  special   absentee  ballots   be  sent   to                                                                   
individuals who, at the time of  the election, were living in                                                                   
a remote area  of the state where distance,  terrain or other                                                                   
natural conditions  denied the  voter reasonable access  to a                                                                   
poling place.                                                                                                                   
Vice-Chair  Meyer  asked what  must  be  done to  have  local                                                                   
elections  coincide with  statewide elections.   Ms.  Glaiser                                                                   
noted that a statutory change would be required.                                                                                
Representative Whitaker  asked for clarification  regarding a                                                                   
resolution  from the League  of Women  Voters and asked  what                                                                   
relevance it  had to  the bill.   Ms. Glaiser responded  that                                                                   
this  resolution  bore  no  relevance  to this  bill,  as  it                                                                   
relates to APOC.                                                                                                                
Representative  Foster MOVED to  report Committee  Substitute                                                                   
HB266 (FIN)  out of  Committee with  the accompanying  fiscal                                                                   
note.   There being NO OBJECTION it was so ordered.                                                                             
CSHB  266 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation and two zero  fiscal notes:  #1 from the                                                                   
Office  of  the  Governor  and  #2  from  the  Department  of                                                                   
HOUSE BILL NO. 216                                                                                                            
     "An Act relating to municipal taxation of refined fuel                                                                     
REPRESENTATIVE  TOM ANDERSON,  SPONSOR, provided  information                                                                   
about  the bill.    He read  from  the sponsor  statement  as                                                                   
     House  Bill 216  clarifies  local taxing  authority  for                                                                   
     refined fuels  sold both within  and outside of  a local                                                                   
     CS  HB 216(CRA)  clarifies that  local governments  have                                                                   
     the  right  to  tax  any   fuel  consumed  within  their                                                                   
     governmental   boundaries,  but   do  not  have   taxing                                                                   
     authority  on  fuel  used  in  turbine-powered  aircraft                                                                   
     (except fuel that his transferred  into an aircraft at a                                                                   
     municipal  or private  airport)  or  wholesale sales  or                                                                   
     transfers of any refined petroleum product.                                                                                
     This type of taxation would also result in residents                                                                       
     from other parts of the State paying local governments                                                                     
     costs in municipalities where they do not reside.                                                                          
     The clarification contained  in HB 216 will also benefit                                                                   
     local governments.  There is some uncertainty now in                                                                       
     state law about the authority to tax fuel, and HB 216                                                                      
     will clarify the authority to tax locally consumed                                                                         
     Finally, one addition has been made to this bill.                                                                          
     Section 4 contains language designed to increase the                                                                       
     maximum amount of loans from the bulk fuel revolving                                                                       
     loan fund from the current $200,000 to $300,000.  This                                                                   
     change is necessary due to the rise in fuel prices                                                                         
     nationwide, especially in rural Alaska.                                                                                  
     And  here in  the  audience and  online  are members  of                                                                   
     industry   including  Jeff   Cook  of  Williams   Alaska                                                                   
     Petroleum who  can give some perspective  on the history                                                                   
     of this idea and the need for this legislation.                                                                            
Co-Chair Harris  clarified that the Committee  was discussing                                                                   
the Community and Regional Affairs version of the bill.                                                                         
JUSTIN CHARON,  YUKON FUEL,  testified via teleconference  in                                                                   
support of the  bill.  He stated that his company  would like                                                                   
to increase the  [AEA administered] Bulk Fuel  Revolving Loan                                                                   
Fund from  $200 to  $300 thousand  as a  result of  increases                                                                   
experienced  in  the  fuel  markets  over  the  past  several                                                                   
months.    He noted  that  volatility  in the  market  eroded                                                                   
buying  power of western  Alaskan consumers.  He pointed  out                                                                   
that  infrastructure was  available in  new villages  through                                                                   
the Denali Commission, which was  allowing them to buy enough                                                                   
fuel for the winter without flying  it in.  He explained that                                                                   
flying fuel could cost as much  as 100 percent more than fuel                                                                   
from barges, but stressed that  consumers sometimes could not                                                                   
afford to purchase barged fuel,  and had no choice but to pay                                                                   
the higher  prices of  flown fuel.   He recommended  that the                                                                   
loan program could alleviate this problem.                                                                                      
TIM  BECK,   FAIRBANKS,  testified   via  teleconference   in                                                                   
opposition  to the  bill.   He  maintained  that  this was  a                                                                   
special interest  tax, and stated that  it was a result  of a                                                                   
similar initiative in the North  Star Borough pertaining to a                                                                   
fuel transfer  tax  on certain  refined fuel  products.    He                                                                   
claimed that  a fuel transfer  tax he had sponsored  had been                                                                   
removed  from  the  agenda  due  to  its  similarity  to  the                                                                   
initiative, thereby curtailing  public discussion on the tax.                                                                   
He referred  to a  February 3,  03 letter  from Jeff  Cook at                                                                   
William  Alaska  validating the  alleged  misinformation  put                                                                   
forth  by  the   initiative  sponsors.    He   noted  that  a                                                                   
resolution  was   to  have  been  forwarded   to  the  Alaska                                                                   
Municipal  League for discussion.     He maintained  that the                                                                   
legislation constituted an "end  run" around the process that                                                                   
includes the states, boroughs,  cities and municipalities and                                                                   
directly  removes  a  local revenue  generator  from  already                                                                   
limited  taxing   authorities.     He  read  from   the  2003                                                                   
municipalities'  handbook,  under  Revenue and  Finance,  and                                                                   
emphasized  that  the  League  would  oppose  limitations  to                                                                   
taxing authority.  He noted that  several communities already                                                                   
had  fuel transfer  taxes  on the  books.   He  asked for  an                                                                   
opportunity for  the Alaska Municipal League  to address this                                                                   
issue at their fall meeting as originally intended.                                                                             
MERRICK  PIERCE, FAIRBANKS  testified  via teleconference  in                                                                   
opposition to the  bill.  He maintained that  the legislation                                                                   
supported special interest groups  and subordinated community                                                                   
interests.    He  suggested that  the  Williams  Company  had                                                                   
approached the North  Pole City Council to pass  a resolution                                                                   
asking  the  legislature  to  change  state  law  and  exempt                                                                   
Williams Alaska from  taxation of jet fuel.   This resolution                                                                   
was rejected by the Council, who  then sent the resolution to                                                                   
the AML for study.  He claimed  that the Corporation had then                                                                   
approached  the legislature  directly, which  resulted  in HB                                                                   
216.   He  offered  an example  of how  wealthy  corporations                                                                   
"played by  different rules"  and manipulate the  legislative                                                                   
system:   when the borough  tax assessors in  Fairbanks asses                                                                   
property  value  they  are required  to  assess  fair  market                                                                   
value,  resulting in  property tax  rates, but  they are  not                                                                   
allowed  to assess  the  pipeline  system lands  since  local                                                                   
officials had that authority taken  from them, resulting in a                                                                   
dramatic  drop  in  the  pipeline  property  valuation.    He                                                                   
maintained that  other residents of  the borough pay  more in                                                                   
property  taxes due  to that  under valuation.   He  stressed                                                                   
that  a rule  in  business was  not  to give  away  something                                                                   
valuable for free, and questioned  the return for Alaskans on                                                                   
this legislation.   He  maintained that  nothing was  gained,                                                                   
but  diversification of  the local  tax base,  needed in  the                                                                   
community to  offset the high cost  of living, was lost.   He                                                                   
noted that the  rate of delinquency of property  taxes in the                                                                   
borough  had exceeded  10 percent, indicating  the heavy  tax                                                                   
burden.   He  stated that  the Fairbanks  North Star  Borough                                                                   
Assembly had not  given its position on the  legislation, and                                                                   
the  North   Pole  City   Council  had   voted  against   the                                                                   
resolution, but asked the AML to consider the issue.                                                                            
Co-Chair Harris asked  if the Alaska Municipal  League or the                                                                   
communities   of  Anchorage   and   Fairbanks  had   provided                                                                   
information.    Representative  Anderson responded  that  the                                                                   
Executive  Director  of  the   Alaska  Municipal  League  had                                                                   
initially  expressed concern  about whether  language in  the                                                                   
bill  prevented taxes  on other  refined  fuel and  petroleum                                                                   
products, which he stated might  generate a future amendment.                                                                   
He  added that  the Municipal  League was  supportive of  the                                                                   
amended legislation.   In response to a question  by Co-Chair                                                                   
Harris, he noted  that Tim Rogers from the  City of Anchorage                                                                   
presented the same initial concerns,  which were also allayed                                                                   
by the amendment.   He stated that the city  of Fairbanks had                                                                   
not  been  present  at  that meeting,  but  stated  that  the                                                                   
Fairbanks Chamber of Commerce endorsed the legislation.                                                                         
Mr. Pierce stressed,  via teleconference, that  the issue was                                                                   
never brought before the Fairbanks Assembly.                                                                                    
PAUL  BARRETT,  FAIRBANKS  testified  via  teleconference  in                                                                   
opposition to  the legislation.   He concurred that  the bill                                                                   
represented  special  interests,  and maintained  that  while                                                                   
Fairbanks should  be enjoying the  lowest fuel prices  in the                                                                   
country, in  fact the  pricing was  among the highest,  since                                                                   
the  Alaska   market  was  smaller  and   instate  refineries                                                                   
experience  extreme economic  advantage.   He submitted  that                                                                   
the purpose  of the legislation  was to preserve  an economic                                                                   
advantage  by maintaining  a price advantage.   He  suggested                                                                   
that the  legislature  should not act  according to  business                                                                   
needs.   He  noted that  Williams Alaska  was concerned  with                                                                   
facilitating a sale of their refinery.                                                                                          
TAPE HFC 03 - 70, Side A                                                                                                      
Mr. Barret continued  his testimony.  He maintained  that the                                                                   
Supreme   Court   had   upheld   tax   plans   innovated   by                                                                   
municipalities.   He  suggested that  before the  legislature                                                                   
acted  preemptively in  this  area that  they  await the  AML                                                                   
analysis scheduled  for the fall.   He concluded  that should                                                                   
the legislature choose to act  preemptively, the state impose                                                                   
a statewide  excise tax  on instate  refiners. He  maintained                                                                   
that as long  as the tax was restricted to  instate refiners,                                                                   
the cost  would not be passed  on to Alaskans, and  that this                                                                   
would mitigate the extreme prices  currently paid by Alaskans                                                                   
for petroleum products.                                                                                                         
JEFF   COOK  WILLIAMS,   VICE   PRESIDENT,  WILLIAMS   ALASKA                                                                   
PETROLIUM testified  in support of the bill.   He stated that                                                                   
Williams  operates  Alaska's  largest  refinery,  located  at                                                                   
North Pole near  Fairbanks.  They also own  product terminals                                                                   
in Fairbanks and Anchorage, 29  convenience stores located in                                                                   
seven Alaskan  communities, and  a three percent  interest in                                                                   
the Trans  Alaskan Pipeline, which  he pointed out  that they                                                                   
did not  acquire until after  the TAPS settlement  agreement.                                                                   
He noted  that since  the refinery  began 25  years ago,  the                                                                   
company has purchased  300 million barrels of  crude oil from                                                                   
the  state  of Alaska,  in  addition  to oil  purchased  from                                                                   
Mr. Cook stated that in June 25,  2002 a special election was                                                                   
held  in  the  Fairbanks/North   Star  Borough  to  determine                                                                   
whether  a  two-cent  per  gallon   transfer  tax  should  be                                                                   
enacted.  He stated that after  much public debate the voters                                                                   
denied the tax  by 62 to 32 percent.  He  maintained that the                                                                   
issue  was  that  the  tax  would   have  cost  Williams  and                                                                   
Petrostar in excess of $20 million  per year.  Williams would                                                                   
not  have passed  the  tax on  to  customers  since they  had                                                                   
alternative sources of supply.   He noted that they refine 70                                                                   
thousand barrels per day of product,  60 percent is jet fuel,                                                                   
of which over 90 percent is shipped  by railcar to Anchorage.                                                                   
He noted that  in addition they supply fuels  to rural Alaska                                                                   
by barge and other means to support  airports and diesel fuel                                                                   
needs.   He  emphasized  that  the air  cargo  industry is  a                                                                   
competitive market,  and that even a penny per  gallon made a                                                                   
big difference. They also export to Japan from Anchorage.                                                                       
Mr. Cook  explained that by the  time the product  leaves the                                                                   
refinery,   it   goes   through    eight   potential   taxing                                                                   
jurisdictions.  If  the transfer tax was added,  they product                                                                   
could  be priced  out  of competition.    He maintained  that                                                                   
their product was a value added  service for interior Alaska.                                                                   
He  also pointed  out  that the  promoters  of  the tax  were                                                                   
asking  producers to  pay for  the  municipal government  and                                                                   
suggested that this  was unfair.  He noted that  prior to the                                                                   
election,  the  North  Start Borough  hired  former  Attorney                                                                   
General Avrum  Gross to  analyze the effects  of such  a tax.                                                                   
He stated  that Mr.  Gross had  determined [letter  dated May                                                                   
29, 2002,  COPY ON FILE]  that the tax  would be a  source of                                                                   
confusion  and  an  unreliable   means  of  revenue  for  the                                                                   
Mr.  Williams  concluded  that  within the  boundaries  of  a                                                                   
municipality,  any  excise  taxes   were  fair,  but  to  tax                                                                   
exported   products  to   pay   for  local   government   was                                                                   
Representative  Foster commented  that in  1993 a village  in                                                                   
his  district began  taxing all  the  by-pass coming  through                                                                   
their airport.  He concluded that  if each municipality added                                                                   
excise   taxes,  the   eventual   cost   of  products   being                                                                   
transported  to  the  villages  would  be  prohibitive.    He                                                                   
stressed his support for the legislation.                                                                                       
Mr. Williams  added that some  members had expressed  concern                                                                   
for small plants  in the North Slope that transfer  diesel to                                                                   
run machinery and wanted to make  sure that this would not be                                                                   
taxable.  He stated that their company understood the                                                                           
concern, and it would be addressed in the bill at a later                                                                       
Co-Chair Harris clarified that Co-Chair Williams did not                                                                        
intend to move the bill at this time, indicating that a new                                                                     
Committee Substitute was forthcoming.                                                                                           
CSHB 216 (CRA) was heard AND HELD in Committee for further                                                                      
The meeting was adjourned at 3:34 P.M.                                                                                          

Document Name Date/Time Subjects