Legislature(1999 - 2000)
04/08/1999 05:10 PM House WTR
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE SPECIAL COMMITTEE ON WORLD TRADE
AND STATE/FEDERAL RELATIONS
April 8, 1999
5:10 p.m.
MEMBERS PRESENT
Representative Ramona Barnes, Chair
Representative John Cowdery, Vice Chair
Representative Beverly Masek
Representative Gail Phillips
Representative Joe Green
Representative Ethan Berkowitz
Representative Reggie Joule
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
* HOUSE JOINT RESOLUTION NO. 34
Relating to the federal estate and gift taxes.
- MOVED HJR 34 OUT OF COMMITTEE
* HOUSE JOINT RESOLUTION NO. 33
Urging the United States Senate to decline to ratify the treaty
from the United Nations Framework Convention on Climate Change
adopted in December 1997 at Kyoto, Japan.
- MOVED HJR 33 OUT OF COMMITTEE
(* First public hearing)
PREVIOUS ACTION
BILL: HJR 34
SHORT TITLE: REPEAL ESTATE AND GIFT TAX
SPONSOR(S): REPRESENTATIVES(S) COGHILL, Barnes
Jrn-Date Jrn-Page Action
3/31/99 624 (H) READ THE FIRST TIME - REFERRAL(S)
3/31/99 624 (H) WTR
4/08/99 (H) WTR AT 5:00 PM CAPITOL 124
BILL: HJR 33
SHORT TITLE: U.N. TREATY ON CLIMATE CHANGE
SPONSOR(S): REPRESENTATIVES(S) PHILLIPS, Green
Jrn-Date Jrn-Page Action
3/26/99 583 (H) READ THE FIRST TIME - REFERRAL(S)
3/26/99 583 (H) WTR
4/08/99 (H) WTR AT 5:00 PM CAPITOL 124
WITNESS REGISTER
REPRESENTATIVE JOHN COGHILL, JR.
Alaska State Legislature
Capitol Building, Room 416
Juneau, Alaska 99801
Telephone: (907) 465-3258
POSITION STATEMENT: Testified as sponsor of HJR 34.
SCOTT KOHLHAAS, Membership Chairman
Alaska Libertarian Party
234 East 15th Avenue, Number 604
Anchorage, Alaska 99501
Telephone: (907) 258-2848
POSITION STATEMENT: Testified in support of HJR 34.
PAMELA LaBOLLE, President
Alaska State Chamber of Commerce
217 Second Street, Suite 201
Juneau, Alaska 99801
Telephone: (907) 586-2323
POSITION STATEMENT: Testified in support of HJR 33.
GARY C. NEWMAN
1083 Esro Road
Fairbanks, Alaska 99712
Telephone: (907) 488-2001
POSITION STATEMENT: Testified in opposition to HJR 33.
ACTION NARRATIVE
TAPE 99-09, SIDE A
Number 0001
CHAIR RAMONA BARNES called the House Special Committee on World
Trade and State/Federal Relations meeting to order at 5:10 p.m.
Members present at the call to order were Representatives Barnes,
Cowdery, Masek, Phillips, Green, and Joule. Representative
Berkowitz arrived at 5:15 p.m.
HJR 34-REPEAL ESTATE AND GIFT TAX
Number 0038
CHAIR BARNES announced that the first order of business was House
Joint Resolution No. 34, relating to the federal estate and gift
taxes. She asked Representative Coghill to come forward and
testify on HJR 34.
Number 0090
REPRESENTATIVE COGHILL, JR., Alaska State Legislature, came forward
to testify. He stated that HJR 34 was a resolution asking the
federal government to speed up the process of H.R. 86 which would
repeal the Internal Revenue Code of 1986, Subtitle B, and
essentially eliminate the so-called "Death Tax". He said that HJR
34 was in existence because the estate tax in Alaska is tied
directly to the Death Tax. He indicated that "any dollar that we
get from the Death Tax or from the estate tax is directly tied to
that federal law; for example, if we repeal our estate tax, then it
all goes to the federal government."
REPRESENTATIVE COGHILL further explained that there is a motion in
the United States Congress to repeal the Death Tax in order to
ensure that American children receive the inheritance they are
entitled to. He stated that HJR 34 is a way to convey that "from
Alaska we think that taxing people after they have worked and
actually paid taxes on the inheritance that they have is bad
policy". He asked that the federal estate and gift tax be repealed
in an expeditious manner.
REPRESENTATIVE COWDERY asked if limits existed on inheritance in
Alaska. He wondered if it was "$600,000 per person before a tax
comes into place."
Number 0289
REPRESENTATIVE COGHILL replied that he understood it to be 20
percent of the federal tax. However, he believed that the federal
tax would depend on the wage. The federal tax could range from 35
percent to 55 percent depending on the size of the estate.
REPRESENTATIVE COWDERY rephrased his question to ask whether or not
there was an exact dollar limit on the size of the estate.
REPRESENTATIVE COGHILL responded that he did not believe a dollar
limit existed.
REPRESENTATIVE GREEN agreed with Representative Coghill's response.
He wondered if an exact dollar limit existed for state tax, though.
REPRESENTATIVE COGHILL replied that the computation at the state
level is just 20 percent of whatever the federal requirement is.
Number 0415
SCOTT KOHLHAAS, Membership Chairman, Alaska Libertarian Party,
testified via teleconference from Anchorage in support of HJR 34.
He read the following testimony into the record:
I am here today with a song in my heart to support House
Joint Resolution No. 34. The estate tax is a
confiscatory tax. It is a tax on dead people. It is a
double tax because they have already paid taxes on it.
People spend their whole lives accumulating whatever they
can and the government decides: "No. This is not going
to go to their children. This will go to us."
When I grew up, my dad used to tell me: "Scott, we are
better than Russia because in Russia you cannot own
property, but here you can." I believed in that. I
thought we were different, and I thought we were better,
but then I grew up and I learned about things like the
property tax and the inheritance tax and the gift tax.
I learned that our government, too, believes that really
they own everything and that it should all go back to
them eventually.
I have been thinking that if the government feels they
have assets - who cares? It is the people without assets
that are voting us in. Then I see something like this
sponsored by Representatives Coghill and Barnes, and I
have hope again. I am here to ask you to vote for HJR 34
and help move along H.R. 86. Let's get rid of the estate
and gift taxes.
CHAIR BARNES asked if any of the committee members had questions.
There were no questions.
Number 0590
REPRESENTATIVE COWDERY made a motion to move HJR 34 with a zero
fiscal note out of committee and asked for unanimous consent.
There being no objections, HJR 34 moved from the House Special
Committee on World Trade and State/Federal Relations.
HJR 33-U.N. TREATY ON CLIMATE CHANGE
Number 0635
CHAIR BARNES announced that the next order of business was House
Joint Resolution No. 33, urging the United States Senate to decline
to ratify the treaty from the United Nations Framework Convention
on Climate Change adopted in December 1997 at Kyoto, Japan.
REPRESENTATIVE PHILLIPS testified as the sponsor of HJR 33. She
read the following statement for the record:
This Resolution is an issue of fairness and protection,
protection against higher costs for Americans and the
loss of American jobs. The Resolution urges the United
States Senate to decline to ratify the treaty from the
United Nations Framework Convention on Climate Change
[Kyoto Treaty] adopted December, 1997 in Kyoto, Japan.
The treaty, if ratified by the U.S. Senate, would commit
the U.S. to reducing our carbon dioxide levels to 7
percent below the levels of 1990. If the U.S. Senate
ratifies this treaty, the U.S. will be placed at a
considerable economic disadvantage to many other
countries with no assurance that these efforts would
substantively impact global warming.
In spite of the lack of sound scientific evidence
supporting the conclusion that carbon emissions are a
major contributing factor to global warming, the Kyoto
Treaty sets very tough standards for the U.S. and other
industrialized countries to meet. However, the treaty
exempts 129 developing nations. China, Mexico, India,
Brazil and South Korea are among the many nations
exempted from these treaty requirements. Not considered
by the Framework Convention were the rapidly increasing
greenhouse gas emissions of the exempted developing
nations. As early as 2015, these countries are expected
to surpass emissions of the U.S. and other countries
included under a more strict application of the treaty.
Number 0800
Forcing the reduction in our carbon emissions will no
doubt result in more government regulation and,
potentially, imposition of carbon production permits,
rationing and taxes on consumer carbon emissions. These
actions would result in sharply increasing costs of
production and in the loss of many American jobs.
Finally, the charge of the United Nations Framework
Convention on Climate Change was to address the
greenhouse gas emissions problem on a global basis. The
Kyoto Treaty fails to do this. While the U.S. should
make every effort to do its part to address the global
warming problem, the burden should not fall
disproportionately on our shoulders while other countries
are exempted from this responsibility. Your support for
this message to the U.S. Senate would help ensure the
Kyoto Treaty is not ratified.
Number 0867
REPRESENTATIVE PHILLIPS noted that in the packets provided to the
committee members there was a policy statement from the Energy
Council stating that the Energy Council unanimously took a stand
against the U.S. Senate's ratification of the Kyoto Treaty. She
further noted that there was more supporting information for
perusal included in the bill packet for HJR 33.
CHAIR BARNES asked if any members of the committee had questions.
There being none, she inquired if there were any people on-line
wanting to testify. There were none and she asked Pam LaBolle to
come forward and testify. [Two testifiers, Cam Toohey and Lori
Cameron, whom Representative Phillips said were in support of HJR
33 had planned to speak via teleconference, but were unable to
because of technical difficulties.]
Number 1079
PAMELA LaBOLLE, President, Alaska State Chamber of Commerce, came
forward to testify in support of HJR 33. She expressed that the
Alaska State Chamber of Commerce did not feel that there was enough
scientific evidence to support the direction the Kyoto Treaty took.
REPRESENTATIVE BERKOWITZ asked, "What is the scientific evidence
that was relied on, and what is the scientific evidence that runs
counter?"
MS. LaBOLLE responded that there is a "great deal" of evidence to
support both sides. She stated that there has not been a complete
and definitive determination that says a drastic action is needed.
Number 1210
CHAIR BARNES recalled that, at the time of the Kyoto Treaty, there
was considerable discussion about the U.S. picking up the burden
for the exempt countries with respect to carbon dioxide gas
emissions. She asked Ms. LaBolle to comment on this issue.
MS. LaBOLLE agreed with the comments Chair Barnes made. She added
that more evidence is being found on other sources of carbon
dioxide not previously known about. She stated that it does not
make sense for developing countries whose populations are ever
increasing to be exempt from the Kyoto Treaty.
CHAIR BARNES commented that she had been to China and the pollution
was so severe that she did not know "they had a sky". She thanked
Ms. LaBolle for her testimony.
Number 1358
REPRESENTATIVE COWDERY added that he felt America sets the
standards for environmental conservation and remarked that he was
very supportive of HJR 33.
REPRESENTATIVE BERKOWITZ asked Representative Phillips if the main
point of HJR 33 was to support U.S. Senate Resolution No. 98.
Number 1514
REPRESENTATIVE PHILLIPS replied that the point of HJR 33 is to urge
the U.S. Senate to oppose ratification of the Kyoto Treaty
developed at the United Nations Framework Convention on Climate
Change.
REPRESENTATIVE BERKOWITZ asked whether the terms referred to on
page 2, line 6, of HJR 33 are the same terms laid out in U.S.
Senate Resolution No. 98.
REPRESENTATIVE PHILLIPS responded that the terms given in U.S.
Senate Resolution No. 98 may not be exactly the same as those
defined in the Kyoto Treaty since the resolution was adopted prior
to the Kyoto meeting.
Number 1610
GARY C. NEWMAN came forward and testified in opposition to HJR 33.
He read the following testimony for the record:
This resolution says that climate change isn't a
certainty and because every country isn't 100 percent on
board that the U.S. shouldn't participate. It further
asserts that there might be taxes imposed to reduce our
contribution to the burning of fossil fuels.
I'm going to be quite candid because I think that
refusing to acknowledge that fossil fuel consumption has
a negative impact on our world's climate is like burying
your head in the sand as the rise of the ocean erodes the
sands around you. Saying that there is still some
uncertainty about the interaction of our impacts on the
world's climate is a fair statement, but I think we take
out household fire insurance on far smaller odds than the
likelihood of our impact on climate change. I think it's
most obvious that we can and are having an impact on the
climate, and nearly all of the scientific community
accepts this. I am somewhat refuting--and we could get
into numbers schemes as to how many scientists support it
or don't support it, but overwhelmingly more and more
folks are finding this is the case. I think by the time
it is totally refutable, it is going to be far too late
to mitigate the severe impacts on the world's
bio-regions.
In Alaska, along with other polar regions, the impacts of
climate change are felt sooner and are far more severe
than in temperate regions. This is just a function of
how the world's climate operates. If you wonder why our
traditional fish stocks are down, why tuna are coming
farther north than before, why permafrost melting is
impacting our infrastructure and roads and buildings more
than ever, these are the sorts of impacts that actually
cost us money. You are looking at one of the areas here
in Alaska where we are more likely to be severely
impacted. I think we ought to be in the forefront of
advocating the reduction of climate change impacts
because it is going to cost us a lot more in the long run
to deal with the impacts.
Representative Barnes, you may recall that there was a
House joint resolution passed under Governor Cowper's
administration that asked the administration to detail
ways that the state of Alaska could help reduce our
contribution to global warming. The report prepared for
the legislature, I thought, was less than settling, but
at least was an attempt to look forward rather than
backward.
As to the failure of other countries such as China or
South Korea to be included in the Kyoto accords, of
course, it would be nice for everybody to be on board,
but we are the richest country in the world, and I think
we can set a better example than we do now by consuming
more fossil fuels per capita than any other country in
the world. I think we can afford to share some of our
better technology with these other countries, and that is
also in our best interest. If you wonder where Arctic
haze comes from, I don't think anyone would argue that
it's coming from the Far East in places like China and
Russia. Those sorts of things are actually contributing
to messing with our climate, our local climate here in
Alaska.
I think reduction of our carbon consumption would,
instead of sharply increasing costs and the loss of
thousands of jobs, as this resolution suggests, ... give
us a better quality of life at a sustainable level. It
has taken us only a hundred years to expend fossil fuel
resources that took nature millions of year to put there.
You can't continue that indefinitely. Now, would you pay
a few hundred dollars more for a car that got 30 miles
per gallon instead of 15? If you look at it over three
years, you are probably going to save over a thousand
dollars. That's a no-brainer. Of course, you would want
to look a little bit to the long term. I know it is hard
to do that in the legislature when you are elected every
two years and you have, basically, the run on (indisc.)
for that. We need to look forward. And we need to look
a little further forward than just the next election.
Number 1892
I think that the most successful energy conservation
program in our state is the Five Star Home Program that
some of you folks may be aware of. It gives a small
discount on the interest rate to folks that have better
and more efficient homes from the standpoint of energy
conservation; better forced ventilation allows people to
live more healthy and allows them to save money in
operating their house. That is a win-win situation. And
I look at some of the concerns of this resolution, and it
looks like it's impact of carbon taxes and government
interference; it looks like it's just trying to sow some
fear, uncertainty and doubt, but I don't think it's in
our best interests in our state. I'm basically trying to
clearly state that in the long run it is cheaper to make
changes now from our very profligate consumption of
finite resources than it is to mitigate the impacts
later. For our kids and their kids' sake, I'd like you
to turn this resolution around and support the concept of
trying to reduce our carbon emissions.
Number 1951
REPRESENTATIVE GREEN stated, "It may be a pretty good leap from the
fact that we are opposed to Kyoto protocals and to say that because
of that we are not trying to do something to reduce the emissions
of our fossil fuel burning. This country has made tremendous
strides in that direction and will continue to do so whether it's
because of an economic imposition, a lack of resources or whatever
the reason. There have been tremendous changes. You see ... in
Los Angeles, Denver-places in the past that were really, really
terrible smog areas-much, much cleaner air now. But to limit us,
to put handcuffs on our development, I think is absolutely the
wrong direction. And you see that same concept in countries that
are developing. Those countries, ... because of poorer economics
they are the ones that pollute the worst. My point to you is that,
I think rather than to handcuff this thing, we will go along with
Kyoto and drop back to a pre-1990 type emissions. What we need to
do is encourage us to go ahead and continue our research, but not
to handcuff us economically to do it. We will do less good under
economic constraints than we will by allowing the economics to
develop and then use those to develop better technology."
MR. NEWMAN inquired if Representative Green was asking him a
question.
REPRESENTATIVE GREEN responded that he wanted to know if Mr. Newman
thought that it made sense to not hinder economic development, and,
at the same time, continue research.
Number 2040
MR. NEWMAN expressed the desire to point out the difference between
smog and "the type of pollution we are talking about that is
climate-change induced." He agreed that the U.S. has made some
strides in the reduction of carbon dioxide emissions, but he said:
By the same token, we are not going quite as far as we
could and we are not looking at this as an opportunity.
We are looking at it as something that is going to cause
us pain, or gas is going to cost more. I will give you
an example. During the Iraqi wars, gas prices shot up.
Everyone was complaining: 'Oh, gee, gas prices are high,
but we are trying to fight a dictator, so I guess we have
to live with that'. But if you put a
five-cent-per-gallon tax on to help defer some of the
carbon emissions and maybe put that into more research to
be able to come up with some better technologies, people
will be complaining a lot more. So, it is a matter of
perspective as to what is better for the short term and
what is better for the long term.
Number 2119
I am urging us to take the long term. If we can come up
with better technology, it is better for us to even give
it to China and South Korea because it is going to help
not only our climate, It's going to help their climate
and it's going to help the world's climate. So, I am
saying that we have more of an opportunity in this
country to do it than anywhere. And in Alaska we have a
definite problem if we don't because if the makers of the
resolution are wrong and, in fact, there is definitely
some impact on climate, it's going to hit us harder here
than any other place in the country just by the nature of
how the world's climate works. I can tell you I live in
areas where there is permafrost and you melt it a degree
or two and you are going to find some impact on how that
is. You talk about money for roads and money for other
sorts of things that are state responsibilities, you are
going to be hurting and you talk about the problems with
the fish, the disaster relief funds and that's a problem
right now.
REPRESENTATIVE PHILLIPS commented that there was scientific
evidence of cooling and warming trends in the state of Alaska in
the last 75 or 80 years. She pointed out that these trends in
Alaska are not necessarily related to global warming, but, instead,
are cyclical.
Number 2273
REPRESENTATIVE COWDERY made a motion to move HJR 33 out of
committee.
CHAIR BARNES asked if there were any objections. There being none,
HJR 33 moved from the House Special Committee on World Trade and
State/Federal Relations.
Number 2318
ADJOURNMENT
There being no further business before the committee, the House
Special Committee on World Trade and State/Federal Relations
adjourned at 5:43 p.m.
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