02/10/2015 03:30 PM Senate COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| Overview: Local Boundary Commission Decision on Allakaket Annexation | |
| Confirmation Hearings: State Assessment Review Board | |
| SB22 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| *+ | SB 22 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
SENATE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
February 10, 2015
3:29 p.m.
MEMBERS PRESENT
Senator Click Bishop, Chair
Senator Bert Stedman, Vice Chair
Senator Lyman Hoffman
Senator Anna MacKinnon
Senator Dennis Egan
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
OVERVIEW: LOCAL BOUNDARY COMMISSION DECISION ON ALLAKAKET
ANNEXATION
- HEARD
CONFIRMATION HEARINGS:
STATE ASSESSMENT REVIEW BOARD
William Roberts - Kodiak
Steve Van Sant - Palmer
CONFIRMATIONS ADVANCED
SENATE BILL NO. 22
"An Act relating to the collection costs for the municipal motor
vehicle registration tax; and providing for an effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 22
SHORT TITLE: MOTOR VEHICLE REG. TAX: COLLECTION COSTS
SPONSOR(s): SENATOR(s) GIESSEL
01/21/15 (S) READ THE FIRST TIME - REFERRALS
01/21/15 (S) CRA, STA, FIN
WITNESS REGISTER
JOHN MANLY, Staff
Senator Bishop
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided an overview of the Allakaket
annexation.
STEVE VAN SANT, Appointee
State Assessment Review Board
Palmer, Alaska
POSITION STATEMENT: Answered questions regarding State
Assessment Review Board appointment.
WILLIAM ROBERTS, Appointee
State Assessment Review Board
Kodiak, Alaska
POSITION STATEMENT: Answered questions regarding State
Assessment Review Board appointment.
SENATOR CATHY GIESSEL
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor for SB 22.
FORREST WOLFE, Staff
Senator Giessel
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Announced his availability to answer
questions regarding SB 22.
DANIEL MOORE, Municipal Treasurer
Treasury Division
Municipality of Anchorage
Anchorage, Alaska
POSITION STATEMENT: Supports SB 22.
KATHIE WASSERMAN, Executive Director
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: Supports SB 22.
ACTION NARRATIVE
3:29:14 PM
CHAIR CLICK BISHOP called the Senate Community and Regional
Affairs Standing Committee meeting to order at 3:29 p.m. Present
at the call to order were Senators Hoffman, MacKinnon, Egan, and
Chair Bishop.
^OVERVIEW: LOCAL BOUNDARY COMMISSION DECISION ON ALLAKAKET
ANNEXATION
OVERVIEW: LOCAL BOUNDARY COMMISSION DECISION ON ALLAKAKET
ANNEXATION
3:31:05 PM
CHAIR BISHOP announced that the committee will briefly discuss
the Local Boundary Commission decision on Allakaket. He
specified that afterwards, the committee will hear from two
appointees to the State Assessment Review Board: Steve Van Sant
and William Roberts. Lastly the committee will hear SB 22 on
vehicle registration costs.
JOHN MANLY, Staff, Senator Bishop, Alaska State Legislature,
Juneau, Alaska, explained that the committee discussion on the
Allakaket annexation is just an informational item. He explained
that the Local Boundary Commission's decisions are often
referred to the Legislature to take action, generally to
disapprove a decision if desired. He specified that the
Legislature has 45 days from the day the decision arrives at the
Senate Secretary's Office. He noted that the 45 day period will
end on March 8, 2015.
He specified that the annexation decision has been brought
before the committee to decide whether or not the committee
wants to do anything. He detailed that the decision was made by
the Local Boundary Commission on November 12, 2014. He said the
annexation decision involves Allakaket and Alatna, both located
on the Koyukuk River. He revealed that no one in the annex area
is opposed. He added that neither Senator Olson nor
Representative Nageak are against the annexation. He asked if
the committee has any interest in having further hearings on the
annexation. He explained that if the committee does not take
action, the 45 days will run out and the annexation will take
effect.
3:32:51 PM
CHAIR BISHOP announced that seeing no objection, the committee
will allow the 45 day period to run out and allow the annexation
to move along.
^ CONFIRMATION HEARINGS: STATE ASSESSMENT REVIEW BOARD
CONFIRMATION HEARINGS:
State Assessment Review Board
3:33:33 PM
CHAIR BISHOP announced that the committee will hear from the
State Assessment Review Board appointees.
3:34:04 PM
STEVE VAN SANT, Appointee, State Assessment Review Board (SARB),
Palmer, Alaska, noted that he retired from state service a year
ago. He specified that he was the State Assessor for 22 years in
addition to serving on the State Assessment Review Board (SARB)
for 25 years, 15 years as chairman. He detailed that SARB
consists of five members and asserted that he brings a lot of
knowledge to the board.
He explained that SARB hears appeals from the oil and gas
industry or municipalities on valuation of oil and gas property
that is assessed under AS 43.56. He noted that the biggest issue
started in 2006 when the State Petroleum Assessor increased the
Trans-Alaska Pipeline System (TAPS) valuation that resulted in a
Supreme Court decision due to appeals from oil companies and
municipalities. He detailed that in 2006, TAPS was assessed at
$3 billion and its value was going down. He noted that the
current value of TAPS is assessed in the $9 billion range.
3:36:52 PM
CHAIR BISHOP concurred that Mr. Van Sant's education, training,
and experience is impressive.
SENATOR MACKINNON stated that she wanted to speak on behalf of
Mr. Van Sant. She noted that Mr. Van Sant has proven to be
honest, trustworthy, and she values his opinion. She stated that
she would be happy to forward Mr. Van Sant's name.
3:38:03 PM
WILLIAM ROBERTS, Appointee, State Assessment Review Board,
Kodiak, Alaska, stated that he has been doing appraising and
assessing work for 32 years in Alaska, the last five years as
the assessor in Kodiak Island Borough. He set forth that his
main emphasis as assessor is trying to bring everything into
"fair and equitable." He stated that he will bring a new
perspective to SARB due to his 23 years as an appraiser in the
field. He specified that he has done a lot of commercial
appraisal. He summarized that he will be able to look at values
and methodology to bring in fair and equitable assessments for
the pipeline.
SENATOR MACKINNON asked Mr. Roberts to address equitability and
how he will decide a value concerning pipelines.
MR. ROBERTS answered that he has reviewed previous pipeline
assessments and asserted that he will find the methodology that
makes the most sense to give a value that is fair and
reasonable.
3:41:31 PM
SENATOR MACKINNON asked what methodology Mr. Roberts will lean
towards in valuation.
MR. ROBERTS replied that SARB has used the cost approach in the
past, an approach that gives good value. He detailed that the
cost approach takes into account economic facts, pipeline
depreciation, previous court cases, and proven oil reserves in
order to decide what is reasonable. He pointed out that
depreciation and economic factors will be the biggest issues for
the TAPS assessment.
SENATOR MACKINNON noted that Mr. Roberts has quite a bit of
community and municipality experience. She asked if Mr. Roberts
tends to think his assessments will be looking more towards
value for local communities or towards the State of Alaska. She
explained that the reason for her question in based upon Mr.
Roberts' statement about equity and fair distribution in
downward oil markets. She noted that there may be resolve to
make up valuation either at the state or local level due to an
actual value devaluation.
3:43:12 PM
MR. ROBERTS replied that Senator MacKinnon misunderstood his
comment on equity. He specified that his whole point would be
that the assessment has to be a reasonable value that is not
partial towards municipalities, the state, or the oil companies.
He asserted that he is supposed to look at the presentations
from all three entities and decide which one makes the most
sense or which blend makes the most sense given the economic
situation of the oil industry.
SENATOR MACKINNON noted that it is important for the committee
to understand the current pipeline's assessment when
consideration is being given to purchase or partner in another
pipeline.
3:45:03 PM
SENATOR STEDMAN moved that the confirmations for Mr. Van Sant
and Mr. Roberts be advanced to the joint session.
3:45:18 PM
CHAIR BISHOP declared that the committee will stand at ease.
3:46:53 PM
CHAIR BISHOP called the committee back to order. He announced
that a confirmation document was signed to move the appointees
forward. He read the following statement:
This does not reflect an intent by any of the members
to vote for or against the confirmation of the
individuals during any further sessions.
SB 22-MOTOR VEHICLE REG. TAX: COLLECTION COSTS
3:47:19 PM
CHAIR BISHOP announced that the next of order of business will
be the consideration of SB 22.
3:47:28 PM
SENATOR CATHY GIESSEL, Alaska State Legislature, Juneau, Alaska,
provided a sponsor's statement as follows:
SB 22 would update the Division of Motor Vehicle's
registration tax that charges to the municipalities.
The way this works is citizens renew their vehicle
registration and we do that through the State of
Alaska. Part of the fee that we pay is a Municipal
Motor Vehicle Registration Tax (MVRT); State of Alaska
collects that for the municipalities and in doing so
they charge an 8 percent user-fee, a charge to
recuperate the cost for the Division of Motor Vehicles
(DMV) for collecting this for the municipalities. DMV
passes the tax itself on to the municipalities, but
they charge this 8 percent fee. This fee was set in
1993 and it hasn't been updated since then despite a
reduction in the cost of collecting this fee. DMV has
become much more computerized, we can now renew our
registrations online and it takes less staff on the
part of DMV. In your packet you have a statement from
the Municipality of Anchorage which points out the
ramifications of this. In 2012 the municipality chose
to nearly double its auto registration fee; they did
this to reduce the amount of property tax for local
residents. As a result of that, with that 8 percent
collection fee, it doubled the fee collection that DMV
did for the very same amount of work, no increased
work, but once the registration fee had gone up and
the 8 percent was calculated off of that, then DMV
ended up collecting over $500,000 in excess fees and
that's just from the municipality of Anchorage. There
are actually 16 municipalities that the DMV collects
this user fee from, this 8 percent fee.
What the bill proposes to do is to lower that
collection percentage to 5.5 percent, so from 8
percent down to 5.5 percent. In looking at the
breakeven cost in 2010, a breakeven would have been
5.1 percent for DMV; so this actually would still give
them a bit of a buffer, it's lowering to 5.5, 5.1 they
would still be collecting the same amount of fee as
they did in 2010. So it is not taking it all away,
it's still going to be collecting some cost for their
administration, but it would essentially be moving
money from DMV into the communities where it actually
belongs, so it would still help reduce property taxes
on the local level.
3:51:11 PM
FORREST WOLFE, Staff to Senator Giessel, Alaska State
Legislature, Juneau, Alaska.
3:51:45 PM
DANIEL MOORE, Municipal Treasurer, Treasury Division,
Municipality of Anchorage, Anchorage, Alaska, confirmed that the
Municipality of Anchorage did write a letter of support for SB
22. He specified that SB 22 corrects an inequity that surfaced
several years ago when the city of Anchorage increased its fee
schedule and basically DMV started to receive a windfall of
revenues based upon the 8 percent statutory rate. He continued
to confirm Senator Giessel's information on MVRT. He pointed out
that DMV has received $500,000 per year for the last 3 years
from Anchorage in additional windfall revenues. He noted that he
disagreed with DMV's assessment in the fiscal note that the
reduced percent was characterized as a loss to the division. He
asserted that DMV's user-fee change should be specified as a
reduction in DMV's windfall.
3:56:04 PM
MR. MOORE summarized that SB 22 represents a win-win for all 16
Alaska communities by reasonably adjusting the MVRT revenues
retained by DMV and corrects the inequity that was never
intended when the city of Anchorage increased its rate base.
SENATOR STEDMAN noted that there are multiple communities listed
and he asked that an impact breakdown be provided on each
community.
SENATOR MACKINNON noted that the expenses that the state incurs
for each community may differ because some communities may be
more labor intensive. She pointed out that Anchorage may have a
consolidation of services from the perspective of electronic
services. She asked that DMV share what their costs are
associated with each of the communities' expenses and variances.
3:58:01 PM
KATHIE WASSERMAN, Executive Director, Alaska Municipal League
(AML), Juneau, Alaska, noted that last year AML dealt with a
bill where DMV provided tax collection breakdowns for 16
communities' license fees. She opined that DMV can assist with
providing the committee with the tax collection breakdowns. She
asserted that AML will be helpful during the current deficit
situation to offer revenue stream assistance.
4:00:16 PM
CHAIR BISHOP announced that SB 22 will be held in committee.
4:00:30 PM
There being no further business to come before the committee,
Chair Bishop adjourned the Senate Community and Regional Affairs
Standing Committee hearing at 4:00 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Roberts resume.pdf |
SCRA 2/10/2015 3:30:00 PM |
|
| SB22 Add'l Info.pdf |
SCRA 2/10/2015 3:30:00 PM |
SB 22 |
| Van Sant Resume.pdf |
SCRA 2/10/2015 3:30:00 PM |
|
| SB22 Sponsor statement.pdf |
SCRA 2/10/2015 3:30:00 PM |
SB 22 |
| SB22 Version A.pdf |
SCRA 2/10/2015 3:30:00 PM |
SB 22 |
| SB22 Sectional.pdf |
SCRA 2/10/2015 3:30:00 PM |
SB 22 |
| SB22 Fiscal Note.pdf |
SCRA 2/10/2015 3:30:00 PM |
SB 22 |
| Allakaket Local Boundary Commission.pdf |
SCRA 2/10/2015 3:30:00 PM |
|
| Allakaket Additional Local Boundary Commission Information.pdf |
SCRA 2/10/2015 3:30:00 PM |