Legislature(1999 - 2000)
02/17/2000 01:10 PM House TRA
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
HOUSE TRANSPORTATION STANDING COMMITTEE
February 17, 2000
1:10 p.m.
MEMBERS PRESENT
Representative Andrew Halcro, Chairman
Representative Beverly Masek
Representative John Cowdery
Representative Allen Kemplen
Representative Albert Kookesh
Representative Vic Kohring
MEMBERS ABSENT
Representative Bill Hudson
COMMITTEE CALENDAR
HOUSE BILL NO. 182
"An Act relating to charitable gaming and to gaming on state
ferries; and providing for an effective date."
- FAILED TO MOVE CSHB 182(TRA) OUT OF COMMITTEE
HOUSE BILL NO. 59
"An Act relating to the motor fuel tax; and providing for an
effective date."
- HEARD AND HELD
HOUSE BILL NO. 319
"An Act providing for and relating to the issuance of state
guaranteed transportation revenue anticipation bonds for the
purpose of paying the cost of transportation projects that
qualify for federal highway aid and the allocation of those bond
proceeds; and providing for an effective date."
- BILL HEARING POSTPONED
PREVIOUS ACTION
BILL: HB 182
SHORT TITLE: CHARITABLE GAMING & GAMING ON FERRIES
Jrn-Date Jrn-Page Action
4/08/99 690 (H) READ THE FIRST TIME - REFERRAL(S)
4/08/99 690 (H) TRA, JUD, FIN
2/01/00 (H) TRA AT 1:00 PM CAPITOL 17
2/01/00 (H) Heard & Held
2/01/00 (H) MINUTE(TRA)
2/15/00 (H) TRA AT 1:00 PM CAPITOL 17
2/15/00 (H) -- Meeting Postponed to 2/17/00 --
2/17/00 (H) TRA AT 1:00 PM CAPITOL 17
BILL: HB 59
SHORT TITLE: MOTOR FUEL TAX
Jrn-Date Jrn-Page Action
1/22/99 67 (H) READ THE FIRST TIME - REFERRAL(S)
1/22/99 67 (H) TRA, FIN
1/22/99 67 (H) 2 FISCAL NOTES (REV, DOT)
1/22/99 67 (H) GOVERNOR'S TRANSMITTAL LETTER
1/20/00 (H) TRA AT 1:00 PM CAPITOL 17
1/20/00 (H) Heard & Held
1/20/00 (H) MINUTE(TRA)
2/15/00 (H) TRA AT 1:00 PM CAPITOL 17
2/15/00 (H) -- Meeting Postponed to 2/17/00 --
2/17/00 (H) TRA AT 1:00 PM CAPITOL 17
WITNESS REGISTER
PATRICK HARMAN, Staff
to Representative Pete Kott
Alaska State Legislature
Capitol Building, Room 118
Juneau, Alaska 99801
POSITION STATEMENT: Answered questions on behalf of the sponsor
of HB 182.
DENNIS POSHARD, Legislative Liaison/Special Assistant
Office of the Commissioner
Department of Transportation & Public Facilities
3132 Channel Drive
Juneau, Alaska 99801-7898
POSITION STATEMENT: Answered questions regarding public transit
systems in relation to HB 59.
ACTION NARRATIVE
TAPE 00-9, SIDE A
Number 0001
CHAIRMAN ANDREW HALCRO called the House Transportation Standing
Committee meeting to order at 1:10 p.m. Members present at the
call to order were Representatives Halcro, Masek, Cowdery,
Kemplen and Kohring. Representative Kookesh arrived as the
meeting was in progress. Representative Hudson was excused.
HB 182 - CHARITABLE GAMING & GAMING ON FERRIES
CHAIRMAN HALCRO announced the first order of business as House
Bill 182, "An Act relating to charitable gaming and to gaming on
state ferries; and providing for an effective date." There was a
proposed committee substitute [version 1-LS0805\D, Luckhaupt,
2/11/00].
CHAIRMAN HALCRO explained that the proposed committee substitute
strips everything out that deals with the ferries. The title was
also amended to reflect the change. He stated the following as
the reason for the change:
I don't believe the state should be in the business of
promoting or providing video gaming. I think, if the
private sector wants to do that, that's fine. I think
the state exposes itself to some tremendous liability
having these machines, and I think it's--in this day
and age--I think it's something that the state should
not be involved with.
CHAIRMAN HALCRO further stated that if the bill passes and
becomes law, the state would be in the position of regulating,
which is totally different from participating and regulating.
Number 0198
REPRESENTATIVE JOHN COWDERY asked: What assurance is there that
the money would go where the bill says?
CHAIRMAN HALCRO answered that the bill indicates the "cut" would
go into the general fund. The question of assurance really is an
issue for the House Finance Committee.
Number 0319
REPRESENTATIVE ALLEN KEMPLEN asked Chairman Halcro whether the
memorandum from Dan Branch [Assistant Attorney General,
Commercial Section, Civil Division, Department of Law] dated
2/15/00 would still apply, since the language pertaining to the
ferries has been stripped. He was referring to the finding that
HB 182 would "open the door" to expanded Indian gaming in the
state.
CHAIRMAN HALCRO replied that his comments would still apply. As
soon as video gaming is legalized, however, it would open gaming
activity on Indian lands for the same type of gaming; it wouldn't
"open the door" to card tables and roulette wheels.
Number 0447
REPRESENTATIVE KEMPLEN asked Chairman Halcro whether the proposed
committee substitute still includes the repealers for political
parties and labor unions.
CHAIRMAN HALCRO called on the sponsor's staff.
Number 0562
PATRICK HARMAN, Staff to Representative Pete Kott, Alaska State
Legislature, came before the committee on behalf of
Representative Kott, sponsor. He answered that the repealer
removes political parties and labor unions from their nonprofit
status for the purposes of gaming. It's the sponsor's intent to
delete that section [Section 33] in the next committee of
referral.
CHAIRMAN HALCRO asked Representative Kemplen whether he would
feel more comfortable offering an amendment to delete that
section in this committee.
REPRESENTATIVE KEMPLEN replied yes. He proposed to delete line
23, on page 21 of Version D.
REPRESENTATIVE COWDERY made a motion to adopt the proposed
committee substitute (CS) for HB 182, version 1-LS0805\D,
Luckhaupt, 2/11/00, as a work draft. There being no objection,
Version D was before the committee.
Number 0617
REPRESENTATIVE KEMPLEN stated the proposed CS really just deals
with video gaming, which is a very narrow purpose. Including
language that repeals who qualifies seems to be outside the scope
of the intent.
CHAIRMAN HALCRO asked Mr. Harman whether AS 05.15.690(25) and
05.15.690(34) deal specifically with labor unions and political
parties.
MR. HARMAN replied yes, that's his understanding.
REPRESENTATIVE MASEK stated that it would be nice to hear from
the bill drafter in relation to the effects of the proposed
amendment.
CHAIRMAN HALCRO noted that according to the [staff of the] bill
sponsor, the proposed amendment would simply leave in place the
ability for both labor unions and political parties to be
"permitees" of video gaming. Right now, they are able to collect
receipts from pull-tabs. The proposed CS simply allows the same
for video gaming.
REPRESENTATIVE KEMPLEN pointed out that there is a linkage to his
proposed amendment on page 19, lines 2-3, of Version D.
REPRESENTATIVE KEMPLEN made a motion to delete line 23 on page
21, and to delete lines 1-8 on page 19 [Amendment 1].
REPRESENTATIVE COWDERY objected. He said this is not an issue
for the House Transportation Standing Committee; the next
committee of referral [Judiciary] can deal with it.
CHAIRMAN HALCRO said he would agree, except this might be
Representative Kemplen's only opportunity to propose an
amendment, since he doesn't sit on the next committees of
referral.
MR. HARMAN announced that the sponsor does not object to
Representative Kemplen's proposed amendment.
A roll call vote was taken. Representatives Masek, Kemplen,
Kookesh and Halcro voted in favor of Amendment 1. Representative
Kohring and Cowdery voted against it. Therefore, Amendment 1 was
adopted by a vote of 4-2.
Number 1028
REPRESENTATIVE COWDERY made a motion to move CSHB 182, version 1-
LS0805\D, Luckhaupt, 2/11/00, as amended, from the committee.
REPRESENTATIVE MASEK objected.
REPRESENTATIVE KEMPLEN asked whether the proposed CS would exempt
video lottery machines from the 1 percent fee referred to in
Section 1. He expressed concern about any potential impact on
revenues.
CHAIRMAN HALCRO answered that Representative Kemplen's question
is an issue for the House Finance Committee.
A roll call vote was taken. Representatives Cowdery and Halcro
voted to move CSHB 182, version 1-LS0805\D, Luckhaupt, 2/11/00,
as amended, from committee. Representatives Kohring, Masek,
Kemplen and Kookesh voted against it. Therefore, CSHB 182(TRA)
failed to move from the House Transportation Standing Committee
by a vote of 2-4.
HB 59 - MOTOR FUEL TAX
CHAIRMAN HALCRO announced the next order of business as House
Bill 59, "An Act relating to the motor fuel tax; and providing
for an effective date." [Not yet adopted was a proposed
committee substitute (CS), Version G (1-GH1040\G, Kurtz,
2/17/00.)]
CHAIRMAN HALCRO explained that in a meeting with Commissioner
Joseph L. Perkins of the Department of Transportation & Public
Facilities, it was agreed that all monies would be directed
towards maintenance, including the existing tax and any proposed
increase. In addition, the proposed CS includes a requirement
for the department to bid out to the private sector all
maintenance jobs. He noted that the department has the ability
to bid on those jobs itself.
CHAIRMAN HALCRO further stated that after hearing testimony from
Kevin Ritchie [Executive Director, Alaska Municipal League], it
was agreed that municipalities would get a rebate. He noted that
the original intent of the 9-cent increase to go towards match-
money for federal highway funds no longer applies. The proposed
committee substitute, therefore, would require 5 cents, of the 9-
cent increase, to be rebated back to municipalities. The
remaining 4 cents would go to the Department of Transportation &
Public Facilities for maintenance projects.
CHAIRMAN HALCRO referred to a spreadsheet from the Municipal &
Regional Assistance Division [Department of Community & Economic
Development] entitled, "HB 59 CS With 5 Cent Allocation to SRS
Road Maintenance Account at FY 00 Road Miles," that illustrates
what each community would get under the proposed committee
substitute. He said the Municipality of Anchorage would get over
$2 million, which could go to either supplementing public works
projects, hauling snow or lowering property taxes. He pointed
out that this type of proposal has never been done before. He
also noted that the 5-cent rebate would make up for the losses in
the municipal revenue sharing assistance program that occurred
last year. He called it a "win-win" [proposal].
CHAIRMAN HALCRO further stated that the gas tax has been at 8
cents a gallon since 1961. It has not been adjusted for almost
40 years, and it doesn't take much to agree that the state's
transportation infrastructures have dramatically increased over
the last 40 years.
CHAIRMAN HALCRO stated in conclusion that he is very wary of
increasing taxes, but this is a user fee. Since the September 14
advisory vote, his constituents have indicated that they want
"something like this"; they want their money to go towards a
tangible benefit. He also pointed out that the proposed CS
contains a sunset clause of July 1, 2005. That way, the
communities and citizens can see whether or not their tax dollars
are translating into funds for road improvements, which is the
intent of the legislation.
Number 1475
REPRESENTATIVE COWDERY asked Chairman Halcro whether his staff
has analyzed how the gas tax compares to other states.
CHAIRMAN HALCRO replied that Alaska ranks fiftieth at 8 cents a
gallon. Alaska would rank forty-fifth increasing it by 9 cents.
REPRESENTATIVE COWDERY pointed out that Alaska is at the top in
terms of the cost of gas. He said:
If we're not going to save the people money, I don't
think when somebody fills their car up, they know
whether it's going to taxes or just coming out of their
pocketbook. That's what they're going to think.
That's why I discussed with you earlier that I wasn't
very enthused about this. ...
REPRESENTATIVE COWDERY mentioned the low price of gas in
Anchorage, and mentioned the outlying areas. He concluded:
So the people, I don't think they will distinguish,
except the bottom line, how much it costs to fill their
tank up - whether it goes for 20 cents for tax or a
nickel for tax. So that's why I'm not really enthused
about this. ... If you want to move it out of
committee, I would support that, but I'm not going to
guarantee that I support the idea.
Number 1574
CHAIRMAN HALCRO stated that this is obviously a difficult
situation, and there are a lot more people in the capitol
building concerned with reelection than reality. He said,
The fact is, with road maintenance or anything else,
... it's this chair's opinion that we need to stop
whistling as we walk past the graveyard, because, you
know, we have some serious problems in this state. And
9 cents a gallon: ... we have not raised this gas tax
in 40 years. ... In my community alone, I can point out
three or four major highways that have been built in
the last 20 years. I am very sensitive to taxes, very
sensitive, but the fact of the matter is, we have to
start somewhere, and on September 14 the people said,
"No, not this plan; come back with another." The
people want as close to user fees as you can get, and
that's exactly what a gas tax is.
Number 1619
REPRESENTATIVE MASEK said the comment made about individuals
getting reelected is going overboard in relation to this piece of
legislation. She said:
We are elected, and we do have to serve our
constituents. We have to get reelected every two
years. That's the norm, and I don't sit here thinking
I'm going to be here for ten years. I go back to the
polls and vote, as my constituents do.
REPRESENTATIVE MASEK further stated that according to surveys she
has conducted in her district regarding the state's fiscal
crisis, an increase in the gas tax is not acceptable. She will
not support it, even though the concept is great. She feels that
the state is not at a crisis [point] yet. The Department of
Transportation & Public Facilities is doing an outstanding job in
terms of getting the roads up to standard, especially since they
have to also deal with the airports and the Marine Highway
System; they have to stretch their budget. Furthermore, the
state receives a lot of federal funding through TEA-21
[Transportation Equity Act for the 21st Century], and the state's
congressional delegation continues to work hard to ensure that
the state gets its fair share. She agrees that there is room for
improvement, but she does not think that raising the gas tax will
solve many of the problems. She, therefore, feels uncomfortable
in supporting the proposed CS at this time.
Number 1758
CHAIRMAN HALCRO pointed out that TEA-21 funds cannot be used to
repair potholes, haul snow, or grate roads, which is where the
department's discretionary general fund money goes. He stated,
as a member of the transportation finance subcommittee, that they
are tasked with cutting $1.5 million from the department's budget
this year. He said:
We saw what happened last year. We have seasonal roads
that won't be opened until June or July. We have snow
hauling that's being capped, so communities are going
to suffer. And this is a good way, I feel, it's a good
way to start the discussion. And, if we're not willing
to start the discussion, what are we doing here?
CHAIRMAN HALCRO further stated that a rebate to local communities
is money that can be used to either offset property taxes or
supplement public works projects. He understands and agrees with
some of the previous comments, but the bottom line is, the state
has created a transportation infrastructure and it cannot pay for
its maintenance and repair.
Number 1823
REPRESENTATIVE COWDERY said if he had to make a decision based on
whether he would be here or not, he might change his vote, but he
does not make his decisions that way. He hopes to come back one
more time, but after that, if he's not reelected, he would
consider it a promotion.
CHAIRMAN HALCRO said the discussion needs to start somewhere. He
doesn't care if it starts with the gas tax or something else. In
addition, people cannot be afraid. He has ten thousand
constituents in his district, and he certainly can't read their
minds. However, it's not until something like this is pushed to
the forefront that people react in the form of e-mails, public
opinion messages and phone calls. It's hard to know if an idea
will "fly" until it's pushed.
Number 1887
REPRESENTATIVE KEMPLEN stated, in reference to the September 14
advisory vote, that it is clear the plan before the voters was
not fair. He said:
The issue of fairness is something that we have to be
addressing when we're crafting any type of solution to
the state's fiscal dilemma. And this piece of
legislation first, as currently crafted, doesn't pass
that test of fairness. Fairness would mean that we
have to be fair to all users of the road system, even
those who are low-income residents and they don't have
access to a vehicle but they depend upon public transit
to get to and from work and get around town. They
should not be shortchanged in how we produce solutions
here.
REPRESENTATIVE KEMPLEN suggested inserting "public transit" after
the phrase "maintenance of highways" on page 6, line 22, of
Version G. It would give those who depend on the public transit
systems a fair share of the resources raised as a result of the
proposed committee substitute.
Number 2005
REPRESENTATIVE ALBERT KOOKESH stated that the last time he
counted, only five or six communities had public transit systems.
The only small community is Metlakatla, which has two buses.
He's not sure that the suggestion by Representative Kemplen would
cover the issue of fairness.
CHAIRMAN HALCRO stated that public transit is a function of local
governments, which are exempt from paying the fuel tax; they are
not affected by the increase. Furthermore, rebating this money
to communities would allow them to underwrite some of the public
transit routes that don't have a ridership. He also pointed out
that the funds would go toward repairing roads, which the public
transit systems use everyday. In addition, public transit
systems do a tremendous job of providing transportation programs
for the low-income and the rules that govern them should be left
at the local level. He doesn't see a place for them in state
statute. He called on Dennis Poshard from the Department of
Transportation & Public Facilities to discuss the issue further.
Number 2099
DENNIS POSHARD, Legislative Liaison/Special Assistant, Office of
the Commissioner, Department of Transportation & Public
Facilities, came before the committee to answer questions. The
department would not be opposed to adding public transit systems.
The department already provides facilities and works with local
governments in relation to CMAQ [Congestion Management/Air
Quality] funds. The department also uses other grants from the
federal government to help local communities implement transit
systems.
Number 2140
REPRESENTATIVE KEMPLEN asked Mr. Poshard whether it's true that
there are a number of public transit systems in the state.
MR. POSHARD replied that there are public transit systems in
Barrow, Kodiak, Mat-Su, Anchorage, Fairbanks, Juneau, Bethel and
Metlakatla.
Number 2171
REPRESENTATIVE KEMPLEN stated, according to his understanding,
that many of these public transit systems struggle to make their
annual budgets, and some help with the cost of maintenance could
make the difference between "being viable" and "going under." He
asked Mr. Poshard whether his comment is correct.
MR. POSHARD replied that nationally he's not aware of any public
transit system that operates solely on income received from the
users. Every public transit system relies to some degree on
public funding through federal, state and city grants. In
relation to Alaska, several public transit systems have had a
hard time coming up with their operating expenses. He said,
"It's pretty easy, you know when we work with them, to come up
with the capital funds to implement them, but actually keeping
their operations afloat is a more difficult task."
REPRESENTATIVE COWDERY made a motion to adopt the proposed CS,
version 1-GH1040\G, Kurtz, 2/17/00, as a work draft. There being
no objection, Version G was before the committee.
Number 2264
REPRESENTATIVE KEMPLEN made a motion to insert the language,
"public transit," after the language, "maintenance of highways,"
on page 6, line 22 [Amendment 1].
REPRESENTATIVE KOOKESH seconded the motion.
CHAIRMAN HALCRO objected. He reiterated that public transit is a
local function, and the funds that would be rebated under the
proposed CS could be used for the local transit system. It
doesn't need to be put in state statute.
REPRESENTATIVE KOOKESH pointed out that if the proposed CS passes
as written, the Municipality of Anchorage stands to gain $1.6
million, which could go towards their public transit system. He
clarified that he'd seconded the motion for discussion purposes
only.
REPRESENTATIVE KEMPLEN stated that public transit systems receive
federal funding from ISTEA [Intermodal Surface Transportation
Efficiency Act] and NECTEA [National Economic Crossroads
Transportation Efficiency Act] for capital equipment. It's
legitimate for the legislature to look at that equipment as an
investment and to maintain it as an asset. He further said:
As with a number of the smaller public transit
operations, if there is difficulty between being able
to pay for a driver and to operate a transit, and then
being able to do the preventative maintenance on their
bus, they're going to keep that service on the road and
they're going to stretch out on the preventative
maintenance.
A roll call vote was taken. Voting to adopt Amendment 1 were
Representatives Kemplen and Kookesh. Voting against it were
Representatives Kohring, Masek, Cowdery and Halcro. Therefore,
Amendment 1 failed to be adopted by a vote of 2-4.
Number 2440
REPRESENTATIVE KOOKESH said he agrees this is one way to utilize
a user fee. He called it a viable plan and a great step forward.
But he said he was a little uncomfortable because many small
communities will not get anything, even though they "pay at the
pump" in some way or another. He asked whether a "floor" has
been considered and suggested that he might propose such an idea.
TAPE 00-9, SIDE B
Number 0001
CHAIRMAN HALCRO said Representative Kookesh makes a good point.
The issue of a floor could be looked at as the bill moves
forward, to ensure that everybody is treated fairly.
CHAIRMAN HALCRO announced that he would not move the proposed CS
out of committee that day, but would bring it up within the next
week or two. [HB 59 was held over.]
ADJOURNMENT
There being no further business before the committee, Chairman
Halcro adjourned the House Transportation Standing Committee
meeting at 1:58 p.m.
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