Legislature(1995 - 1996)
04/28/1995 08:55 AM House FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
April 28, 1995
8:30 A.M.
TAPE HFC 95-104, Side 2, #000 - end.
TAPE HFC 95-105, Side 1, #000 - 424.
CALL TO ORDER
Co-Chair Mark Hanley called the House Finance Committee
meeting to order at 8:55 p.m.
PRESENT
Co-Chair Hanley Representative Martin
Co-Chair Foster Representative Mulder
Representative Brown Representative Navarre
Representative Grussendorf Representative Parnell
Representative Kelly Representative Therriault
Representative Kohring
ALSO PRESENT
Representative Carl Moses; Senator Johnny Ellis; Bob
Bartholomew, Director, Income and Excise Audit Division,
Department of Revenue; Margot Knuth, Criminal Division,
Department of Law; Cheryl Sutton, Staff, Representative
Moses.
SUMMARY
HB 122 An Act authorizing payment of a portion of the
motor fuel tax on boats and watercraft as refunds
to municipalities; and providing for an effective
date.
CSHB 122 (FIN) was reported out of Committee with
"no recommendation" and with a fiscal impact note
by the Department of Revenue.
HB 297 An Act relating to fees for a commercial fishing
vessel license.
HB 297 was reported out of Committee with "no
recommendation" and with a fiscal impact note by
the Department of Fish and Game.
SB 67 An Act relating to the crime of unlawful evasion.
1
SB 67 was reported out of Committee with and with
two zero fiscal notes; one by the Department of
Administration, dated 3/9/95; one by the
Department of Law, dated 3/9/95; and one by the
Department of Corrections, dated 3/9/95.
$hb122
HOUSE BILL NO. 122
"An Act authorizing payment of a portion of the motor
fuel tax on boats and watercraft as refunds to
municipalities; and providing for an effective date."
REPRESENTATIVE CARL MOSES, SPONSOR provided members with a
proposed committee substitute for HB 122, work draft
the work draft would increase the marine motor fuel tax from
$.05 to $.08 cents. Three cents on each gallon would be
shared back to the municipality where the fuel was sold.
The revenue generated from the $.05 cent tax would be
deposited in to the General Fund. He stressed that the
$40.0 thousand dollar administrative cost would be deducted
by the portion shared to municipalities. He emphasized that
during the last 10 years funding for boats and harbors has
declined. He advocated making special concessions to small
boats of 64 feet and under. He observed the need for
facilities. He stressed that HB 122 would provide a
mechanism to maintain or build harbor facilities. He noted
in some communities boats have been lifted on to city docks
due to the lack of safe moorings.
In response to a question by Representative Therriault, Mr.
Moses stated that the accounting and collection of $.05 will
not be changed.
In response to a question by Representative Brown,
Representative Moses reiterated that the tax will be shared
back to the communities where the tax was collected.
Representative Brown noted that new reporting requirements
would be imposed on motor fuel sales.
BOB BARTHOLOMEW, DEPUTY DIRECTOR, INCOME AND EXCISE AUDIT
DIVISION, DEPARTMENT OF REVENUE stated that motor fuel
dealers contacted by the Department indicated that they
would be able to comply with the additional reporting
requirement. He observed that under current law the tax is
collected at the wholesale level. The tax is collected on
the first sale or transfer within the State. The committee
substitute would require that a secondary sale or transfer
that changes cities would have to be reported. The person
who transported the fuel across city lines would be
responsible for reporting. The fuel is only taxed once at
2
the wholesale level. The reporting requirement would allow
the Department to track the disposition of fuel use.
In response to a question by Representative Kelly,
Representative Moses acknowledged that municipalities could
impose a motor fuel tax. He emphasized that a statewide tax
would prevent competition among municipalities.
Representative Navarre expressed concern that the
legislation would take away from the State's ability to
raise revenues. He emphasized that there are a wide range
of opportunities to raise revenues on a local level.
Representative Mulder asked if other funding sources exist.
Representative Moses noted that the United States Corps of
Engineers assist where breakwaters are required.
Representative Mulder emphasized that an overall problem in
relation to the state's transportation system exists. He
suggested that a ballot amendment should be placed to see if
voters will adopt a fuel tax increase dedicated to improving
roads, airports, and harbors around the state.
In response to a question by Representative Therriault,
Representative Moses observed that the tax would be
deposited in the General Fund. He noted that the Department
of Transportation and Public Facilities would like to see
the funding dedicated for maintenance or new facility
construction. He felt that utilities and landfills should
be included. Representative Therriault did not think that
municipal dumps should be funded by motor fuel taxes.
Representative Moses observed that marine fuel purchased
from gas stations would already be paying a tax of $.08
cents on a gallon.
Representative Grussendorf observed that the city of Sitka
has an enterprise harbor fund to encourage privatization of
State harbors. Any money generated from the fishing fleet
is used to support the water front. He stressed that the
public will support a tax that is used to support local
harbor needs.
Representative Moses noted the need for small boat
facilities.
In response to a question by Representative Kelly,
Representative Moses noted that CDQ funds have been used to
build docks. He noted that CDQ funds do not have to be
spent on dock facilities. Representative Grussendorf
pointed out that CDQ funds only pertain to Bering Sea
communities. They do not have a statewide affect.
3
Representative Therriault summarized that the legislation
would impose a uniform tax on municipalities to prevent
competition.
Representative Brown observed that the title would require
reporting for all motor fuels. Mr. Bartholomew explained
that section 5 on page 3 incorporates current regulation
requirements for reporting. He stated that the new
reporting requirement for marine motor fuel is on page 5
(d).
Representative Navarre pointed out that the committee
substitute sets up a mechanism in which any increases in
motor fuel tax would include water craft and motor fuel, and
be shared back to municipalities at a rate of 37.5 percent.
He emphasized that any future increase in motor fuel tax
would be accompanied by a demand for some level of
allocation to municipalities. He stressed that the areas of
greatest sales would benefit most from the shared tax. He
observed that there are huge portions of the state's
transportation system that are not within areas where the
fuel might actually be sold.
In response to a question by Co-Chair Foster, Representative
Moses clarified that the administrative fee would be taken
from the municipalities' portion of the tax. Mr.
Bartholomew added that the accompanying Department of
Revenue fiscal note would be revised to reflect the net zero
impact.
Representative Mulder argued that if coastal communities
receive a share of marine fuel tax that there will be no
incentive for them to approve a ballot measure to increase
the motor fuel tax. He spoke in favor of a dedicated motor
fuel tax for support of the State's transportation system,
administered directly by the State. He emphasized that the
only way that a motor fuel tax proposition will be supported
is if there is broad base support. He maintained that the
big picture must be considered.
Representative Moses expressed concern that the federal
government will look at the State's highway fund formula and
decide that the State is not taxing itself. He emphasized
that the State is behind in addressing these problems. He
observed that if the tax were instituted by municipalities
it would be possible for dealers to escape the tax by the
use of barges for fuel sales.
Representative Mulder suggested that a constitutional vote
needs to be taken. Representative Brown stated that she
does not support dedicated funds. She acknowledged that
4
facilities have been allowed to deteriorate. She expressed
support for expanding the legislation to include all motor
fuels. She observed that there are many interest groups
that would have a legitimate reason to argue for their own
dedicated fund. She felt that the public would understand
that it is necessary to support the transportation
infrastructure. She reiterated support for inclusion of
other motor fuel taxes.
Representative Moses pointed out that there is currently no
accounting method to determine where the marine fuel tax is
being paid. He estimated that non-residents and residents
in his district pay a large portion of the tax. He
reiterated the need for maintenance and new harbor
facilities in his district. He asserted that his district
is 10 to 15 years behind in supporting these needs.
Representative Grussendorf spoke in support of providing a
funding source for municipalities to address their harbor
needs. He observed that there is competition to attract the
fishing fleet. He emphasized that a steady revenue stream
would allow municipalities to make provisions for the
services the fishing fleet needs. He observed that the
fishing fleet has a positive effect on a municipality's
economy.
Representative Grussendorf MOVED to adopt work draft
so ordered.
Representative Mulder MOVED to adopt an updated Department
of Revenue fiscal note to reflect that the administrative
cost will be deducted from the share of the tax given to
municipalities.
In response to a question by Representative Mulder,
Representative Moses acknowledged that there is no guarantee
that revenues raised as a result of the legislation would be
used to fund harbor maintenance or projects.
(Tape Change, HFC 95-105, Side 1)
Representative Navarre maintained that the State has
attempted to meet the growing need for harbor maintenance
and facilities. He stressed that the State's contribution
for harbor facilities has been adequate given fiscal
constraints. He pointed out that municipalities have the
ability to raise revenues through harbor and other user
fees. He expressed his concern with the erosion of a
potential tax base for the State.
Representative Brown questioned if language would be
5
included in the front section of the HB 100 to authorize the
Department to distribute back the money collected under the
statute. Mr. Bartholomew noted that other shared taxes
administered by the Department of Revenue are authorized
through the front section.
Representative Moses stated that the language in HB 122 is
almost identical to authorization language in other shared
taxes.
Representative Grussendorf MOVED to report CSHB 122 (FIN)
out of Committee with individual recommendations and with
the accompanying fiscal note which reflects that the
administrative cost would be deducted from the $.03 cents
shared with municipalities. Representative Navarre
OBJECTED.
A roll call vote was taken on the MOTION to move CSHB 122
(FIN) from committee.
IN FAVOR: Grussendorf, Kelly, Kohring, Mulder, Parnell,
Therriault, Foster, Hanley
OPPOSED: Navarre, Brown
Representative Martin was absent from the meeting.
The MOTION PASSED (8-2).
CSHB 122 (FIN) was reported out of Committee with "no
recommendation" and with a fiscal impact note by the
Department of Revenue.
HOUSE BILL NO. 297
"An Act relating to fees for a commercial fishing
vessel license."
REPRESENTATIVE CARL MOSES, SPONSOR testified in support of
HB 297. He stressed that there has been an inequity in the
vessel licensing fee. He noted that a 14 foot skiff is
charged the same $20 dollar fee as a 300 foot off shore
troller. He observed that similar legislation passed both
Houses in the previous session, but was vetoed by the
Governor. He stated that the previous legislation was
amended in the Senate to increase non-resident fees beyond
resident fees. The Governor was concerned that litigation
involving disparities between resident and non-resident fees
could be affected by the legislation. He added that a
disparity in resident and non-resident fees could be
confusing where residency differs among owners. He observed
that the legislation will raise approximately $544.0
thousand dollars. He expressed the intent that the revenues
6
raised by the legislation be used to support the Department
of Fish and Game's budget. He emphasized the fairness of
charging according to the ability of a vessel to harvest the
resource.
Co-Chair Hanley acknowledged that he has a boat in the 25 to
50 foot range. He questioned if the Department would have
the flexibility to issue two year licenses.
CHERYL SUTTON, STAFF, REPRESENTATIVE MOSES clarified that
the Department would be able to issue two year licenses at
double the cost of a one year licenses. She noted that it
is not the intent of the legislation to provide a discount
for a two year license.
Representative Navarre MOVED to report HB 297 out of
Committee with individual recommendations and with the
accompanying fiscal note.
Representative Therriault OBJECTED for purpose of
discussion. He referred to the intent section. He stated
that anticipated that the FY 97 House Finance Subcommittee
for the Department of Fish and Game will develop a budget
for the Department within the constraints of available
funding. Representative Therriault WITHDREW his objection.
Representative Kohring summarized that funds resulting from
the increase in vessel fees will go into the General Fund
with the intent that they will be appropriated for fish and
game related uses.
Representative Moses commented that most of the fees will be
received before the January 1, 1995.
Representative Grussendorf pointed out that program receipts
generated through limited entry permits are deposited into
the General Fund. He observed that the request for an
investigator by the Limited Entry Commission was denied. He
emphasized that there is no guarantee that the money will be
used for the Department of Fish and Game.
There being NO OBJECTION, HB 297 was reported out of
Committee.
HB 297 was reported out of Committee with "no
recommendation" and with a fiscal impact note by the
Department of Fish and Game.
SENATE BILL NO. 67
"An Act relating to the crime of unlawful evasion."
7
SENATOR JOHNNY ELLIS, SPONSOR testified in support of SB 67.
He observed that Anchorage downtown activists requested the
legislation in response to concerns that escapes of
misdemeanants from halfway houses were not being taken
seriously. He observed that there were 23 walk-aways by
misdemeanants in half-way houses in FY 93, 68 in FY 94, and
31 to date in FY 95. He stated that walk aways have gone on
to commit drunk driving and drug crimes. He maintained that
the current sanction should be consolidated at the higher
felony level of up to one year in prison and up to a $5.0
thousand dollar fine. Misdemeanants would have the same
deterrent as felons for escaping from a half-way house. He
observed that a consensus was achieved by neighborhood
activists and operators of the half-way houses.
Co-Chair Foster questioned the zero fiscal impact. Senator
Ellis emphasized that the intent is to create a deterrent.
MARGOT KNUTH, CRIMINAL DIVISION, DEPARTMENT OF LAW stressed
that there is no difference in the cost of prosecuting class
A or class B misdemeanor cases. She stressed that while
there would be no fiscal cost from the legislation there
would be a deterrent impact. She emphasized that the
legislation simplifies the criminal code and is welcomed by
the Department of Law.
In response to a question by Co-Chair Foster, Ms. Knuth
noted that the typical offender housed in a half-way house
is non-violent.
Representative Parnell questioned why there would be no
increase to the Department of Corrections to reflect the
increased jailed time. Ms. Knuth stated that there is an
assumption that the actual period of incarceration is not
likely to go up. She observed that there would be a longer
period of supervision under a suspension of sentence. She
acknowledged that there may be some additional time if the
suspension is revoked. She added that if the suspended
sentence is revoked another offense would be involved.
Representative Martin queried if offenders that walk away
from a half-way house would have to serve their probation
time. Ms. Knuth noted that there will be times when the
half-way house constitutes the offender's sentence.
Senator Ellis observed a trend toward more serious offenders
being placed in halfway houses due to over crowding in
correctional facilities. He acknowledged that it is good
policy to have a facility from which offenders can be
transitioned back into the community.
Co-Chair Foster MOVED to report SB 67 out of Committee with
individual recommendations and with the accompanying fiscal
8
notes.
ADJOURNMENT
The meeting adjourned at 10:05 a.m.
9
| Document Name | Date/Time | Subjects |
|---|