Legislature(1993 - 1994)
02/08/1994 08:00 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE STATE AFFAIRS STANDING COMMITTEE
February 8, 1994
8:00 a.m.
MEMBERS PRESENT
Representative Al Vezey, Chairman
Representative Pete Kott, Vice Chairman
Representative Bettye Davis
Representative Gary Davis
Representative Harley Olberg
Representative Jerry Sanders
Representative Fran Ulmer
MEMBERS ABSENT
None
COMMITTEE CALENDAR
HB 328: "An Act relating to motor vehicle registration
and registration fees; to fees for drivers
licenses and permits; and providing for an
effective date."
HEARD AND HELD TO TIME UNCERTAIN
HB 363: "An Act repealing an additional fee for motor
vehicle registration not conducted by mail."
HEARD AND HELD TO TIME UNCERTAIN
HCR 25: Relating to a state materials exchange.
PASSED OUT OF COMMITTEE
HB 240: "An Act allowing gaming devices on ferries."
HEARD AND HELD TO TIME UNCERTAIN
HB 345: "An Act relating to the preservation of public
facilities and to appropriations for annual
maintenance and repair, periodic renewal and
replacement, and construction of public
facilities."
NOT HEARD
WITNESS REGISTER
REP. TERRY MARTIN
Alaska State Legislature
Alaska State Capital, Room 411
Juneau, AK 99811
Phone: 465-3783
Position Statement: Sponsor of HB 328.
JANE BUTLER, Staff
REPRESENTATIVE PETE KOTT
Alaska State Capitol, Room 409
Juneau, AK 99811
Phone: 465-3777
Position Statement: Testified in favor of HB 328.
JUANITA HENSLEY
Division of Motor Vehicles
Department of Public Safety
P.O. Box 20020
Juneau, AK 99802
Phone: 465-2650
Position Statement: Testified in favor of HB 328 and HB
363.
REPRESENTATIVE CARL MOSES
Alaska State Legislature
Alaska State Capitol, Room 204
Juneau, AK 99811
Phone: 465-4451
Position Statement: Sponsor of HB 240.
DONALD STOLWORTHY, Director
Division of Charitable Gaming
Department of Revenue
P.O. Box 110440
Juneau, AK 99811
Phone: 465-2229
Position Statement: Answered questions on HB 240.
PREVIOUS ACTION
BILL: HB 328
SHORT TITLE: BIENNIAL VEHICLE REGISTRATION
SPONSOR(S): REPRESENTATIVE(S) MARTIN,BARNES,Phillips,B.Davis
JRN-DATE JRN-PG ACTION
01/03/94 2013 (H) PREFILE RELEASED
01/10/94 2013 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2013 (H) STATE AFFAIRS, FINANCE
01/13/94 2054 (H) COSPONSOR(S): B. DAVIS
01/22/94 (H) STA AT 08:00 AM CAPITOL 102
01/22/94 (H) MINUTE(STA)
01/29/94 (H) MINUTE(STA)
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 363
SHORT TITLE: NO FEE FOR CAR REGISTRATION IN PERSON
SPONSOR(S): REPRESENTATIVE(S) KOTT,B.Davis
JRN-DATE JRN-PG ACTION
01/11/94 2033 (H) READ THE FIRST TIME/REFERRAL(S)
01/11/94 2033 (H) STATE AFFAIRS, FINANCE
01/13/94 2056 (H) COSPONSOR(S): B. DAVIS
01/29/94 (H) STA AT 08:00 AM CAPITOL 102
01/29/94 (H) MINUTE(STA)
01/29/94 (H) MINUTE(STA)
01/29/94 (H) MINUTE(STA)
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HCR 25
SHORT TITLE: STATE INDUSTRIAL MATERIALS EXCHANGE
SPONSOR(S): REPRESENTATIVE(S)
KOTT,Green,Menard,Nordlund,B.Davis
JRN-DATE JRN-PG ACTION
01/10/94 2005 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2005 (H) LABOR & COMMERCE, STATE AFFAIRS
01/14/94 2082 (H) COSPONSOR(S): GREEN
01/21/94 2126 (H) COSPONSOR(S): MENARD
01/24/94 2139 (H) COSPONSOR(S): NORDLUND
01/26/94 2159 (H) COSPONSOR(S): B. DAVIS
01/27/94 (H) L&C AT 03:00 PM CAPITOL 17
01/27/94 (H) MINUTE(L&C)
01/31/94 2201 (H) L&C RPT CS(L&C) 6DP
01/31/94 2201 (H) DP: HUDSON, PORTER, SITTON,
MACKIE
01/31/94 2201 (H) DP: WILLIAMS, GREEN
01/31/94 2201 (H) -ZERO FISCAL NOTE (DEC) 1/31/94
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 240
SHORT TITLE: GAMBLING DEVICES ON STATE FERRIES
SPONSOR(S): REPRESENTATIVE(S) MOSES,Bunde
JRN-DATE JRN-PG ACTION
03/19/93 708 (H) READ THE FIRST TIME/REFERRAL(S)
03/19/93 708 (H) TRANSPORTATION, STATE AFFAIRS,
FINANCE
04/01/93 (H) TRA AT 05:00 PM CAPITOL 17
04/01/93 (H) MINUTE(TRA)
04/05/93 977 (H) TRA RPT 1DP 3NR
04/05/93 978 (H) DP: G.DAVIS
04/05/93 978 (H) NR: MACKIE, MULDER, MENARD
04/05/93 978 (H) -FISCAL NOTE (DOT) 4/5/93
04/05/93 978 (H) REFERRED TO STATE AFFAIRS
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
BILL: HB 345
SHORT TITLE: PRESERVATION OF PUBLIC FACILITIES
SPONSOR(S): REPRESENTATIVE(S) JAMES
JRN-DATE JRN-PG ACTION
01/07/94 2018 (H) PREFILE RELEASED
01/10/94 2018 (H) READ THE FIRST TIME/REFERRAL(S)
01/10/94 2018 (H) STATE AFFAIRS, FINANCE
01/25/94 (H) STA AT 08:00 AM CAPITOL 102
01/25/94 (H) MINUTE(STA)
02/08/94 (H) STA AT 08:00 AM CAPITOL 102
ACTION NARRATIVE
TAPE 94-8, SIDE A
Number 000
CHAIR AL VEZEY called the meeting to order at 8:00 a.m.,
announcing that a quorum was present. Members present were
REPRESENTATIVES KOTT, SANDERS, G. DAVIS, B. DAVIS, and
ULMER. REPRESENTATIVE OLBERG entered at 8:01 a.m.
HB 345 was postponed by request of the sponsor,
REPRESENTATIVE JEANNETTE JAMES. CHAIR VEZEY opened the
floor with HB 328 and a work draft of the committee
substitute to HB 328 was handed out.
HB 328 - BIENNIAL VEHICLE REGISTRATION
Number 046
REPRESENTATIVE TERRY MARTIN, sponsor of HB 328, began with
an overview of the committee substitute to HB 328. He
thanked the Department of Finance and the Department of
Environmental Conservation (DEC) for their contributions to
the revised version of HB 328. There is now a savings of
$300,000 dollars to the general fund which will be made up
by fees. Changes include the date, the addition of picking
up stalled or trashed vehicles, and the DEC will be the
major enforcer of emissions control. Cities do not like the
idea of collecting their own taxes, however, it will add to
the efficiency of the registration process. REPRESENTATIVE
MARTIN noted Anchorage as an example.
JANE BUTLER, representing REPRESENTATIVE KOTT, explained the
changes to HB 328. Sections 1-5 have no changes. Section 6
adds a motor vehicle pollution fee, while deleting the
annual Motor Vehicle Registration Tax (MVRT). The MVRT will
be transferred to municipalities. Sections 7-11 have no
changes. Section 12 is corrected on page 6(15) to have no
increase in fee. Section 13 allows the Division of Motor
Vehicles (DMV) to collect the emission control program fee,
which will be transferred to the DEC. Section 14 allows
fees to be paid with a credit card. Section 15 is a
conforming amendment to Section 16 having the municipalities
impose the tax instead of the DMV. Section 16 changes the
title from the DMV to the municipalities. The fee schedule
is the same, but the reference to the DMV to collect the tax
is deleted, page 8(c). Section 18 refers to the DEC
administering the emission control program. DEC is to
determine enforcement, regulation, and price of the program.
Section 18(f) establishes a motor vehicle emissions control
account in the general fund which the Environmental
Protection Agency is in favor of. Section 19 deletes AS
28.10.108(b) by request of the DMV because it is no longer
applicable to the current registration process. AS
28.10.431 will be repealed and a new statute will be enacted
with the municipalities to cover the tax collection change.
Section 20 allows the registration fee to be collected at
the time of registration or renewal. Section 20(b) begins a
start up fee on July 1, 1994, through December 1, 1994,
which will cost $2 for six months before the biennial
process begins. This fee will provide DEC with a start up
fund to implement the emissions program. DEC's fee for
biennial registration, which is yet to be determined, will
begin on January 1, 1995.
Number 208
REP. FRAN ULMER inquired if the transfer of the tax to the
municipalities would really be more efficient. The increase
of paperwork was as concern.
Number 225
MS. BUTLER could not answer the question and deferred it to
REPRESENTATIVE MARTIN to answer in later testimony.
Number 237
CHAIR VEZEY noted the direction of HB 328 was to remove the
DMV from the collection of municipal property taxes. He
asked if the possibility of collecting taxes on a biennial
basis was explored.
MS. BUTLER believed not. The main accomplishment of HB 328
was to separate the DMV from the MVRT.
Number 250
CHAIR VEZEY asked if the vehicle registration fees remained
unchanged and if they still are one and one-half times the
current rate. He noted the change to allow the DMV to
collect a $2 emissions fee for the rest of the calendar
year.
MS. BUTLER replied the fee begins July 1, 1994.
Number 257
CHAIR VEZEY emphasized the July 1, 1994, start up date and
the effective date in Section 22 would be nullified without
a two-thirds vote by both houses.
Number 261
MS. BUTLER stated the DEC expects the administration costs
for the emission control program will be covered by a fee of
approximately $8 every two years.
Number 263
CHAIR VEZEY questioned why the tax rate for vehicles is
included in HB 328, if the DMV is getting out of collecting
taxes.
MS. BUTLER replied the original information was located in
AS 28 which is under DMV. The information is being repealed
from AS 28 to be in AS 29 under a municipalities statute.
Number 299
CHAIR VEZEY asked who would be collecting the taxes under
Section 16.
MS. BUTLER responded the municipalities would be.
Number 304
CHAIR VEZEY stated he understood why a state would need a
statute if it needed to collect taxes, however, he did not
understand why the legislature would need to be involved in
the Anchorage municipality.
Number 310
REPRESENTATIVE GARY DAVIS asked MS. BUTLER which of the fees
or taxes are new to the municipality of Anchorage.
Number 313
MS. BUTLER noted the MVRT under Section 16 is exactly the
same as what is currently being charged.
REPRESENTATIVE G. DAVIS believed Section 16 would be new.
MS. BUTLER pointed out to REPRESENTATIVE G. DAVIS that the
MVRT has always been collected.
REPRESENTATIVE PETE KOTT stated there may be reason to
remove Section 16 from HB 328 since there is not a fee
change.
REPRESENTATIVE BETTYE DAVIS requested the testimony of
REPRESENTATIVE MARTIN on HB 328.
Number 341
REPRESENTATIVE ULMER highlighted the principle purposes of
HB 328 to REPRESENTATIVE MARTIN. She then questioned what
the true efficiency would be of giving the MVRT back to the
municipalities and wondered if it would be a duplication of
the current state process.
Number 359
REPRESENTATIVE MARTIN replied in the past individuals
received and filled out a property tax statement. The DMV
then began collecting taxes for the city. He believed this
was done to make the people believe they were paying less in
property taxes by having the state take care of it. The
fees are included because the Alaska Constitution states
only the Legislature has the power to tax and it shall never
be surrendered; meaning the state has the power on all
levels to impose taxes. The degree of taxation is included
in Title 29 for municipalities. REPRESENTATIVE MARTIN noted
the MVRT has become a burden to the state and just last year
the DMV wanted to increase the fees to 35 percent. The
cities, however, did not want to give them more money for
collecting the fee. He felt the one form the city will
provide would be more efficient than the transporting
process from the state to the city. REPRESENTATIVE MARTIN
emphasized Section 16 was included to show the changes
occurring and his major concern with HB 328 was to decrease
the lines at the DMV.
REPRESENTATIVE B. DAVIS inquired if this process would
provide the $300,000 savings.
Number 423
REPRESENTATIVE MARTIN replied yes, and noted the DEC will be
able to decrease the general fund allocation to about
$260,000 and also collect fees on those who default on
getting their registration. Decals are going to be provided
to ease in the enforcement of inspection and registration
control.
Number 439
CHAIR VEZEY asked REPRESENTATIVE MARTIN if he believed
Section 16 was needed to grant Anchorage the authority to
takeover the MVRT.
Number 442
REPRESENTATIVE MARTIN responded Anchorage already has the
authority and it is for technical purposes to return it to
Title 29.
CHAIR VEZEY asked if the legislature structures property
taxes for municipalities.
REPRESENTATIVE MARTIN clarified the legislature allows the
cities certain authority.
Number 452
CHAIR VEZEY noted the legislature does not structure sales
taxes.
Number 453
REPRESENTATIVE MARTIN replied the authority (to structure
taxes) is in Title 29.
Number 454
CHAIR VEZEY wondered why the cities needed more authority
than that given in Title 29 to do property taxes.
Number 455
REPRESENTATIVE MARTIN answered past legislatures decided the
MVRT would be the tax for various vehicles and experts
believe it should now be in Title 29.
Number 461
CHAIR VEZEY introduced JUANITA HENSLEY as the next witness.
Number 474
JUANITA HENSLEY, representing the DMV, testified in favor of
HB 328. MS. HENSLEY stated the DMV has been collecting 5-6
million dollars for 10 municipalities, eight percent of
which is being kept to cover administrative costs. HB 328
will account for a 4.9 million dollar loss to the general
fund which will be further increased without the eight
percent collection. Section 16 of HB 328 will provide a set
fee for the municipalities to collect the MVRT. Currently,
the municipalities are set into a tax base when they agree
to have the DMV collect their taxes. Therefore, without DMV
available for collection, Section 16 will provide the
municipalities with tax base guidelines. MS. HENSLEY
proposed Section 16 be deleted and the authority be placed
back with the municipalities under Title 29, but do not
establish a set tax base structure. The municipalities
could set it where they like. DMV is in favor of biennial
vehicle registration to cut down on their lines and improve
efficiency.
Number 510
CHAIR VEZEY asked if it would be feasible to change the tax
collection to a biennial period.
Number 518
MS. HENSLEY did not know if there was a constitutional
problem with collecting on a two year tax base, in which
case, moving out of the state and eligibility for rebates
would have to be a consideration.
Number 522
CHAIR VEZEY noted people do not receive a rebate after
buying an annual license and moving out of state after six
months.
Number 524
MS. HENSLEY replied there is a difference between an annual
registration and an actual tax the state is collecting for
the cities.
Number 525
CHAIR VEZEY clarified the state is collecting the tax now
and people who are living in Alaska only part of the year
are not being rebated.
Number 527
MS. HENSLEY agreed with CHAIR VEZEY.
Number 528
CHAIR VEZEY was not aware of any constitutional problems
with biennial tax collection.
Number 530
REPRESENTATIVE ULMER questioned how the DMV felt towards the
collection of the municipalities taxes and if this process
was a stable situation as long as the fees to cover the
administrative cost are being collected.
Number 532
MS. HENSLEY replied the DMV has a neutral opinion. DMV is
one of the revenue generators for the state, as it collects
over 29 million dollars for the general fund.
REPRESENTATIVE ULMER requested an overview of the fiscal
note.
Number 540
MS. HENSLEY noted the loss incurred with the change from two
times the current rate to one and one-half times. The fee
will be reduced from $70 to $53 every two years which will
amount to a loss of $4.6 million. The MVRT will also lose
the collection of fees for one year due to the expanded two
year base. This factor will amount to about $4.9 million in
lost funds to the state. An additional $2.75 million will
be lost to the municipalities in the original version of HB
328. The revised version of HB 328 which takes the MVRT
from the DMV and places it back on the municipalities will
total the states losses at $4.9 million.
Number 559
REPRESENTATIVE ULMER could not understand why state revenues
were being released when the state has a great deficit.
Efficiency is great, however, a revenue neutral bill should
be considered.
MS. HENSLEY added the credit card cost would be another cost
with an operational fee of approximately $225,000 a year.
CHAIR VEZEY asked to point out the credit card cost in the
bill.
Number 569
MS. HENSLEY noted page 3, line 22, Section 9(3). The cost
is paid to the credit card companies.
Number 576
CHAIR VEZEY inquired of the DMV's position on the use of
credit cards.
Number 578
MS. HENSLEY welcomed credit card use to cut down on NSF
checks and the extra work they create.
Number 582
REPRESENTATIVE KOTT reaffirmed MS. HENSLEY'S opinion. The
extra payment on top of the reduction in fees may "dig a
deeper hole" REPRESENTATIVE KOTT stated.
Number 586
MS. HENSLEY urged the use of credit cards to ease those
people who dislike using checks or money orders. A credit
card system will provide an easier move to higher technology
using touch-tone phones to renew registrations and ATM
machines to acquire driving records. Drivers license
reinstatements can also be quite expensive and the use of a
credit card would ease payments for the customer. The
reduction of fees, MS. HENSLEY believes, does not have to
happen and the current rate times two could remain in place,
thereby, the state would only incur the credit card cost.
Number 614
CHAIR VEZEY asked if the credit card cost would be less than
the current cost of pursuing bad debt receipts.
Number 619
MS. HENSLEY replied no. The action taken on bad checks
received is to place holds on registrations, titles, and
drivers licenses. The credit card fee would have to be
appropriated because the DMV budget could not absorb it.
Number 623
CHAIR VEZEY related to the reason of increased efficiencies
as a justification for the credit card cost.
Number 627
MS. HENSLEY agreed.
REPRESENTATIVE HARLEY OLBERG stated the credit card fees
would be deducted from the revenues generated by the fees
from the bank in which it is deposited. Therefore, no
appropriation should be necessary.
CHAIR VEZEY believed the state would probably not see the
money unless it was accounted for.
Number 635
REPRESENTATIVE G. DAVIS questioned if an extra charge could
already be on the credit card and if the credit card company
would collect it.
Number 641
REPRESENTATIVE OLBERG answered an extra charge cannot be
charged for a service or product because the payment is made
by credit card. As the transaction takes place the bank
will skim its discount off the transaction and there will be
no exchange of money between the State of Alaska and the
bank.
CHAIR VEZEY asked REPRESENTATIVE OLBERG if he was referring
to federal law and whether it was still legal to offer cash
discounts as opposed to credit card charges.
REPRESENTATIVE OLBERG replied yes.
Number 649
Seeing no more testimony, CHAIR VEZEY asked REPRESENTATIVE
KOTT if he would like to continue working on HB 328.
Number 651
REPRESENTATIVE KOTT replied it would be a good idea to look
HB 328 over again as the committee substitute was just
received. The reduction in fees is a concern and the need
for Section 16 will be examined.
Number 663
CHAIR VEZEY announced HB 328 would be held over for review
and would be rescheduled in the future.
HB 363 - NO FEE FOR CAR REGISTRATION IN PERSON
CHAIR VEZEY opened the floor for discussion on HB 363.
Number 672
REPRESENTATIVE KOTT reviewed HB 363. The $10 surcharge is
repealed for those who want to apply for their vehicle
registration in person. A fiscal impact of a $1.6 million
would occur. He felt the registration fees for those who
apply in person could increase by $5 which would generate $2
million and offset the $1.6 million loss. If the situation
were to remain neutral the state could gain about $400,000.
A $5 reduction would still be offered for those who opt to
use the mail system.
CHAIR VEZEY asked if a sponsor or committee substitute would
be proposed for HB 363.
Number 696
REPRESENTATIVE KOTT replied yes.
TAPE 94-8, SIDE B
Number 000
REPRESENTATIVE OLBERG asked if REPRESENTATIVE KOTT intended
to propose the substitute in State Affairs or in Finance.
REPRESENTATIVE KOTT said it did not really make a
difference; however, Finance may be the appropriate place
for it. The fees for all registered vehicles will increase
by $5 in person with a $5 break for using the mail system.
Number 026
REPRESENTATIVE OLBERG stated he had received a numerous
amount of support for repealing the $10 fee and he supports
REPRESENTATIVE KOTT'S $5 increase and decrease suggestion.
REPRESENTATIVE OLBERG did state he cannot support HB 328 if
it includes any sort of reduction in registration fees.
REPRESENTATIVE OLBERG is in favor of moving HB 328 to
Finance.
REPRESENTATIVE ULMER liked REPRESENTATIVE KOTT's adjustment
to HB 328 and asked how successful the $10 fee was in
discouraging people from coming in and applying in person.
Number 055
JUANITA HENSLEY answered questions on HB 363. Prior to the
$10 fee 30 percent mailed registration renewals in. After
imposing the fee, the percentage of mailed registration
renewals has increased to 60 percent. Lines have decreased
in size. There is a three-five percent increase in new
titles every year. MS. HENSLEY believed a $5 increase will
not be a suitable deterrent for coming to DMV in person.
Number 087
REPRESENTATIVE KOTT responded an increase in the size of
lines may turn out to be more incentive to want to use the
mail system. There is no greater efficiency by using the
mail rather than applying in person because handling the
mail takes just as long as person to person contact. He
reinforced the lines would not substantially increased and
the $5 increase would be alright.
MS. HENSLEY hoped to see a decrease of lines because the
front counter clerks tend to take a lot of abuse from the
public.
Number 141
REPRESENTATIVE ULMER suggested the application for the
permanent fund dividend include a one page attachment for
motor vehicle registration. The public may take note of the
form if attached to a widely read document. She also
suggested to REPRESENTATIVE KOTT that a State Affairs
committee substitute to HB 328 be proposed before it is
given to the Finance Committee because they may not pay
attention to a revenue reducing bill. A bill which will
raise revenues may have more of a chance.
REPRESENTATIVE G. DAVIS agreed with REPRESENTATIVE ULMER and
would like a substitute to HB 328.
REPRESENTATIVE KOTT had no problem with proposing a
substitute, however, he has contacted Finance with the
changes to be made to HB 328 and they had no problem with
it.
Number 195
CHAIR VEZEY asked for further comment on HB 363.
REPRESENTATIVE KOTT asked CHAIR VEZEY for his decision on HB
363.
CHAIR VEZEY announced HB 363 would be held in committee for
reconsideration.
Number 216
REPRESENTATIVE KOTT asked the committee members if an
amendment might be offered so HB 328 might move out of
committee amended.
Number 221
CHAIR VEZEY did not want to move HB 328 out of committee on
a verbal amendment, however, the committee substitute may be
discussed.
REPRESENTATIVE OLBERG reminded REPRESENTATIVE KOTT a
committee substitute for HB 328 would be made be State
Affairs members.
Number 230
REPRESENTATIVE ULMER proposed a committee substitute should
be prepared with a new fiscal note so HB 328 may pass out of
the committee with "do pass" written on it.
CHAIR VEZEY allowed REPRESENTATIVE KOTT to put forth an
amendment if he wished to do so.
Number 246
REPRESENTATIVE KOTT opted to bring back a committee
substitute.
HCR 25 - STATE INDUSTRIAL MATERIALS EXCHANGE
Number 248
CHAIR VEZEY opened the floor for discussion of CSHCR 25
announcing a zero fiscal note and that if passed it will
proceed to House Rules.
Number 259
REPRESENTATIVE KOTT, sponsor of CSHCR 25, began an overview
of the contents. CSHCR 25 would acknowledge April as the
State Materials Exchange Month. REPRESENTATIVE KOTT read
his sponsor statement. (See attached.) CSHCR 25 is a joint
effort of the public and private sector to reduce the flow
of industrial waste into Alaska landfills. The Support
Industry Alliance, British Petroleum, ARCO, and the DEC
Pollution Prevention office are participants. Various
materials will be for sale or just available at no cost. A
computerized network or booklet will be available to locate
available materials. Across Canada and the lower 48 states
there are about two dozen material exchanges already in
operation. These exchanges are saving the industry
approximately $27 million annually and the equivalent of
100,000 barrels of oil. REPRESENTATIVE KOTT believed CSHCR
25 would foster responsible management of available
resources in Alaska with minimal or no cost. There is great
support for CSHCR 25.
Number 319
CHAIR VEZEY wanted to clarify if REPRESENTATIVE KOTT meant
mainly hazardous and toxic materials, not general
construction materials.
REPRESENTATIVE KOTT answered the materials could consist of
anything. There is no limit. (i.e. large machinery)
Number 324
CHAIR VEZEY stated hazardous and toxic waste has a very
important role in our society and he clarified CSHCR 25 does
relate to all industrial materials.
Number 332
REPRESENTATIVE KOTT agreed.
Number 333
CHAIR VEZEY inquired of the states role in the materials
exchange process.
Number 335
REPRESENTATIVE KOTT replied the state would facilitate the
private and public sector to work together.
Number 339
REPRESENTATIVE G. DAVIS indicated CSHCR 25 sounded like
other recycling efforts and wanted to make sure CSHCR 25
would not be duplicating other business.
Number 347
CHAIR VEZEY rejected CSHCR 25 as recycling, rather a
redistribution of useful materials. A potentially hazardous
material needs to be handled properly as long as it is
useful, however, it becomes an expensive commodity when
termed a hazardous waste and no longer needed. CSHCR 25
allows potential users to locate surplus supplies.
Number 366
REPRESENTATIVE JERRY SANDERS agreed with the intent of CSHCR
25, however, he questioned the zero fiscal note and the
desire government employees to facilitate the program for
nothing.
Number 372
REPRESENTATIVE KOTT responded he would not challenge the
fiscal note and stated he was informed the employees would
cooperate. The cost estimated at $30 would have to be
absorbed and there would be little work to do. He noted the
effort has been on-going and CSHCR 25 is merely recognizing
April as the "kick-off month". This coincides with DEC's
major promotional effort to prevent pollution.
Number 387
CHAIR VEZEY stated if the amount of material being dumped in
disposal sites would be reduced there would be substantial
savings in future recycling efforts. CSHCR 25 is a
statement of support for the program without mandating any
programs or authorizing any funds.
Number 398
REPRESENTATIVE SANDERS offered CSHCR 25 may have a negative
fiscal note with more research.
Number 402
CHAIR VEZEY agreed if the program was identified. CHAIR
VEZEY also felt private industry would not support the
resolution if it did not see CSHCR 25 as a place to save
money.
Number 404
REPRESENTATIVE G. DAVIS supported CSHCR 25 and proposed this
effort may have been instigated by large companies due to
DEC eliminating clean-up day after a reduction in its'
budget.
Number 421
REPRESENTATIVE KOTT did not know who began the program. DEC
is merely beginning a campaign to include both the public
and private sector in the clean up process.
Number 430
REPRESENTATIVE ULMER moved CSHCR 25 to the committee and
asked for individual recommendations.
Number 435
CHAIR VEZEY asked if there were any objections, hearing
none, the secretary noted the vote had unanimous consent,
and the bill was passed around the committee for signatures
and recommendations. CHAIR VEZEY called for a short recess
at 9:10 a.m. and will reopen business with HB 240.
(REPRESENTATIVE ULMER left the committee meeting at 9:10
a.m.)
HB 240 - GAMBLING DEVICES ON STATE FERRIES
CHAIR VEZEY reconvened the meeting at 9:20 a.m. and opened
discussion on HB 240.
Number 448
REPRESENTATIVE MOSES, sponsor of HB 240, presented a brief
overview of HB 240 supplied by his sponsor statement. (See
attached.) HB 240 is intentionally crafted to allow the
state ferry system to set up and operate or contract out the
program.
Number 465
CHAIR VEZEY commented HB 240 has been created in a
convoluted manner and asked if Commerce and Economic
Development has been changed to Revenue.
Number 478
REPRESENTATIVE MOSES replied if HB 240 passes "(we) can do
whatever we want to it."
Number 481
CHAIR VEZEY understood the Commissioner of Revenue would
have control over the gambling. CHAIR VEZEY questioned the
wording which states "...a gambling device does not include
a gambling device as authorized by statutes." "...a gambling
enterprise is not a vessel of the Alaska Marine Highway
System." He felt the approach of HB 240 seemed backwards
and asked if it was necessary because Alaska's gambling was
so complicated.
Number 492
REPRESENTATIVE MOSES was not very familiar with the
technical details of HB 240, but felt the problems could be
worked out.
Number 495
CHAIR VEZEY began to examine where the gambling machines
would be located.
Number 503
REPRESENTATIVE MOSES answered the ferries would find room.
CHAIR VEZEY noted the different sizes of the ferries and the
limited space on the smaller ones. He questioned if HB 240
was practical.
Number 514
REPRESENTATIVE MOSES assumed the ferry system would have
discretion to put the gambling devices only on ferries where
it would be practical.
CHAIR VEZEY warned of constituents who are against legalized
gambling and wondered how it could be explained to those
individuals.
Number 527
REPRESENTATIVE MOSES explained a revenue stream would be
developed and the winter traffic on ferries would probably
increase by 20 percent.
CHAIR VEZEY asked if the increase in traffic would be
primarily residents of Alaska.
REPRESENTATIVE MOSES believed the gambling would be an
attraction for the tourist industry. The increased flow of
traffic would be very beneficial.
Number 539
REPRESENTATIVE KOTT commented some cruise lines have closed
down their gaming operations because they were not very
profitable. He warned the public may not feel the incentive
to take the ferry solely to gamble. He also inquired about
the associated costs involved in managing the gaming
facilities.
Number 554
REPRESENTATIVE MOSES had not seen a projected revenue report
and responded to REPRESENTATIVE KOTT gambling would be added
attraction to the ferries, not the sole incentive.
Number 561
REPRESENTATIVE OLBERG commented the gaming machines must be
located in the bar area to limit those under 21 years of age
from playing.
REPRESENTATIVE KOTT agreed a regulated area must be
available
Number 572
CHAIR VEZEY added minors are allowed in places which serve
alcoholic beverages as long as they are accompanied by a
parent or legal guardian. He did not, however, know if the
law also applied to gambling facilities.
Number 575
REPRESENTATIVE MOSES reaffirmed CHAIR VEZEY and stated
minors are allowed inside, however, gambling is not
encouraged.
REPRESENTATIVE KOTT agreed with CHAIR VEZEY and noted HB 240
has a provision which prohibits minors from entering a
gambling area. A ferry's bar area would no longer work as a
location for the gambling machines. The alcohol
establishment statute would either have to be changed or HB
240 would override it.
Number 598
REPRESENTATIVE MOSES thought the liquor laws would have to
be incorporated whereby HB 240 would be changed to specify
"unless accompanied by a parent or legal guardian."
Number 607
REPRESENTATIVE KOTT agreed and mentioned policies of other
states.
Number 610
CHAIR VEZEY thought other states did not allow minors in
alcohol facilities at all.
REPRESENTATIVE OLBERG suggested a space be dedicated to the
gambling devices and have the access controlled. An
overhead would have to be incurred.
Number 617
REPRESENTATIVE KOTT commented alcohol and gambling are
closely related in other facilities.
Number 621
REPRESENTATIVE OLBERG noted the object is to raise revenue.
Number 622
REPRESENTATIVE KOTT suggested alcohol and gambling not be
separated.
Number 625
REPRESENTATIVE SANDERS wanted HB 240 to be worded like the
liquor laws where minors may be present if accompanied by a
parent or guardian.
REPRESENTATIVE OLBERG stated if the gambling devices are not
in the bar the overhead becomes self-defeating. An extra
employee would be required.
Number 634
REPRESENTATIVE SANDERS added the social atmosphere would not
be the same in a separate area from the bar. The purpose of
HB 240 would be defeated.
Number 637
REPRESENTATIVE KOTT did not want minors in the gambling
area. He believed it did not facilitate the proper social
attitude.
CHAIR VEZEY clarified slot machines were not the topic of
conversation. The machines used would not distribute coins
or cash.
Number 660
REPRESENTATIVE OLBERG suggested the use of machines which
dispense pull tabs.
Number 661
CHAIR VEZEY agreed.
Number 663
REPRESENTATIVE B. DAVIS expressed concern for the amount of
machines required and the anticipated revenue stream. She
then asked if there was not any money coming to the state,
would HB 240 be for entertainment purposes only.
REPRESENTATIVE MOSES replied entertainment on coin operated
machines is common now with two people playing a machine,
not exposing their money, but still making debts.
TAPE 94-9, SIDE A
Number 007
REPRESENTATIVE B. DAVIS asked if these games are already
being played on the boats.
Number 011
REPRESENTATIVE MOSES said no, but the machines are available
and found in bars.
Number 022
REPRESENTATIVE KOTT illustrated the fiscal note does state
six machines will be put on mainline vessels.
CHAIR VEZEY recalled reading the provision of six machines
written in the fiscal note.
REPRESENTATIVE MOSES stated the amount of machines may
increase due to demand for their use.
CHAIR VEZEY introduced DONALD STOLWORTHY as the next
witness.
Number 052
DONALD STOLWORTHY, DIRECTOR, CHARITABLE GAMING DIVISION,
DEPARTMENT OF REVENUE, answered questions on HB 240. On
July 1, 1993, Charitable Gaming transferred from the
Department of Commerce to the Department of Revenue by
Executive Order 82. HB 240 states this change is for "house
cleaning purposes."
Number 072
CHAIR VEZEY recognized this reason.
REPRESENTATIVE KOTT asked what kind of machines might be
installed on the ferries.
MR. STOLWORTHY explained the three classes of gaming: Class
1 - video games, pinball machines; Class 2 - pull tabs,
bingo (nonelectronic & nonmechanical sanctioned games);
Class 3 - slot machines, electronic pull tab games (District
Court 4, District of Columbia, Washington, recently ruled
electronic pull tab games as Class 3.), video poker. Class
3 games return either money or tokens from the machine to
the player. MR. STOLWORTHY predicted HB 240 would allow
electronic pull tab games, video poker, and slot machines
which return tokens.
CHAIR VEZEY asked for a clarification of the three classes
of gaming devices.
Number 150
MR. STOLWORTHY offered the three criteria as proposed by the
courts which constitute gambling. These three include
chance, consideration (i.e. paying money), and prize (i.e.
receiving cash). Once past Class 1 the games are considered
gambling devices.
CHAIR VEZEY questioned if Class 1 games are not gambling
devices, why are they classified as a Class 1 gambling
device?
Number 174
MR. STOLWORTHY replied the Class 1 games are for
entertainment purposes only and he could not answer why they
are labeled as gambling devices.
Number 180
REPRESENTATIVE KOTT noted the difference between Class 1 and
Class 2 and 3 combined is no external pay out. He then
asked if HB 240 could require the provided slot machines to
only emit tokens which could be redeemed on the ferry.
Number 201
MR. STOLWORTHY felt REPRESENTATIVE KOTT's request could be
included in HB 240, however, he believed the ferries would
be more likely to use video poker and video pull tab
machines which dispense tokens.
Number 213
REPRESENTATIVE SANDERS asked about the use of "set back
buttons" on machines he has seen used in bars.
Number 222
MR. STOLWORTHY answered "set back buttons" are currently
illegal to use in the state of Alaska because the amount of
payout by the facility is harder to keep track of.
Fraternal clubs, veterans organizations, and bars tend to
have machines with these devices installed in them.
CHAIR VEZEY inquired if "set back buttons" were used to
reduce the chances of winning.
MR. STOLWORTHY responded "set back buttons" are merely used
to circumvent the law. The game tallies the total amount of
games played and can be reset at any time. Computers are
available to be hooked up to machines without "set back"
devices which give tallies of the amount of free games left
on the machines that have been paid back in cash.
REPRESENTATIVE SANDERS thought some states had their
gambling machines directly wired into the State Department
of Revenue and inquired if it would be possible on ferries.
Number 282
MR. STOLWORTHY clarified REPRESENTATIVE SANDERS was
referring to "on-line technology". States, such as Nevada,
have computers which calculate the odds on many machines and
print out any discrepancies found. These computers are
extremely accountable. He noted paper pull tabs have a wide
margin for pay out discrepancies with forged cards and
insider trading. Reports are filed quarterly that are
matched up with the computer printouts. This process
creates a solid accounting system.
Number 338
CHAIR VEZEY did not understand the incentive behind only
allowing gaming devices that do not dispense coins or cash.
MR. STOLWORTHY did not know the reason.
CHAIR VEZEY clarified Department of Revenue did not have a
preference because the accountability of both types of
machines would be close to the same.
Number 346
MR. STOLWORTHY replied the money and token dispensing
machines are identical devices which merely vary where the
money is picked up.
Number 348
CHAIR VEZEY asked for a committee member to volunteer to
work with REPRESENTATIVE MOSES, sponsor, on HB 240.
REPRESENTATIVE B. DAVIS volunteered. Hearing no more
testimony, HB 240 was held in committee to be rescheduled.
ANNOUNCEMENTS
CHAIR VEZEY announced a meeting for the Alaska Railroad
Review Committee would be scheduled, possibly Saturday,
February 12, and asked for members to relay convenient
times.
ADJOURNMENT
Seeing no more business before the committee, CHAIR VEZEY
adjourned the meeting at 10:00 a.m.
BILLS NOT HEARD
HB 345 - "An Act relating to the preservation of public
facilities and to appropriations for annual maintenance and
repair, periodic renewal and replacement, and construction
of public facilities" was scheduled but not heard.
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