Legislature(1999 - 2000)
05/03/1999 09:10 AM Senate FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
May 3, 1999
9:10 AM
TAPES
SFC-99 # 117, Side A and Side B
CALL TO ORDER
Co-Chair Torgerson convened the meeting at approximately
9:10 AM.
PRESENT Senator John Torgerson, Senator Sean Parnell,
Senator Al Adams, Senator Dave Donley, Senator Lyda Green,
Senator Pete Kelly, Senator Loren Leman, Senator Randy
Phillips, Senator Gary Wilken.
Also Attending:
GABRIELLE LAROCHE, Acting Director, Division of
Governmental Coordination, Office of Management and Budget,
Office of the Governor; KERRY HOWARD, Project Review
Coordinator, Division of Governmental Coordination, Office
of Management and Budget, Office of the Governor; REX
BLAZER, Division of Governmental Coordination, Office of
Management and Budget, Office of the Governor; KEN TAYLOR,
Director, Division of Habitat and Restoration, Department
of Fish and Game; WILSON CONDON, Commissioner, Department
of Revenue; DEBORAH VOGT, Deputy Commissioner, Department
of Revenue; WENDY REDMOND, Vice President, University
Relations, University of Alaska; MURRAY WALSH, Planning and
Development Consultant;
Attending via Teleconference: From Anchorage: JOHN BAKER,
Assistant Attorney General, Natural Resources Section,
Civil Division, Department of Law; JANE ANGVIK, Director,
Division of Land, Department of Natural Resources; NANCY
MICHAELSON; From Barrow: JOHN DUNHAM, Planning Department,
North Slope Borough; From Dillingham: JOHN EASTON, Coastal
Service Manager, Bristol Bay Coastal Resource Service Area;
From Kodiak: LINDA FREED, Kodiak Island Borough; From Mat-
Su: BILL EASTHAM; KATHY WELLS, Creator, Hatcher Pass
Management Plan; KAROL KOLEHMAINEN, Program Coordinator,
Aleutians West Coastal Resource Service Area; From Nome:
ROBBIE FAGERSTROM, Co-Chair, Alaska Coastal Policy Council;
SUMMARY INFORMATION
SB 140-COASTAL ZONE MANAGEMENT TO DNR
The committee heard from the sponsor, the Division of
Governmental Coordination and the Department of Law. Public
testimony was taken. A committee substitute, Version "N",
was adopted as a Workdraft. The bill was held in committee.
SB 67-GOVERNOR'S INC TAX:INDIVID/EST/TRUSTS
The committee heard from the Department of Revenue. The
bill was moved from committee.
(Senator Dave Donley wanted to know if there was a proposed
CS for the Power Cost Equalization bill. Co-Chair John
Torgerson there was proposed but it needed funding
sources.)
CS FOR SENATE BILL NO. 140(RES)
"An Act relating to the powers and duties of the
Department of Natural Resources, modifying that
department's power to control and manage land within
the Hatcher Pass Public Use Area, and authorizing
municipal selection of that land, and relating to the
Alaska coastal management program; and providing for
an effective date."
BRUCE CAMPBELL, staff to Senator Randy Phillips, testified.
SB 140 was a mission alignment bill. It also changed
statutory adjustment needed to allow for the budget
allocation to the Department of Natural Resources.
The statutory adjustments for Department of Natural
Resources would make the planning and classification
process more flexible, optional or more permissive.
"Shall" was replaced with "may" in many places in the first
ten pages of the bill. This would allow flexibility in the
classifications land planning process.
The land planning process was not the only process the
department engaged in. It was one of the steps prior to
getting to a land sale. Land planning classification
usually preceded a best interest finding, which also had a
public review and public notice. It also preceded sales or
leases, each of which had its own public notice, public
hearings, findings and determinations that were generally
preformed in a specific order. This change would perhaps
lower litigation cost, according to Bruce Campbell.
The second half of the bill, beginning on page eleven,
would move the Division of Governmental Coordination and
its associated coastal management program into the
Department of Natural Resources.
[Pause on the record to determine the location of the
language in the bill.]
Bruce Campbell explained where the language defining the
Alaska Coastal Policy Council was located.
The intent was to move the process with no major policy
changes or alterations to the program that would disturb
the on-going process. The individuals themselves would not
physically move.
The Division of Governmental Coordination currently did not
have a director. Efficiencies would be realized by the
savings of eliminating this position through merging the
division with the Department of Natural Resources.
Co-Chair John Torgerson wanted to know if the witness still
anticipated a saving in the maintenance of efforts from
combining the two agencies. Would more federal funding be
captured? Bruce Campbell had spoken to the National
Oceanographic and Atmospheric Administration and was told
the funding would probably not change. The programs had
reached a funding cap. US Representative Don Young was
working on obtaining more funding, but Bruce Campbell did
not anticipate an increase in federal funding.
Current state funds allocated to the Division of
Governmental Coordination were fairly low and functioned
under the Office of Management and Budget, Office of the
Governor.
Senator Al Adams asked if the merger would create any
potential conflict with the regulation of state land use or
with activities on private or public lands. Bruce Campbell
replied that he did not see any and detailed. Federal law
expressly requested that the governing state agency have
the power to direct state land and water use planning and
regulations, which the Office of Management and Budget did
not have but the Department of Natural Resources did have.
Federal law required that the entity that operated the
coastal zone program shall have the power to approve or
disapprove, after public notice, specific permits or
actions. The Division of Governmental Coordination assumed
that through a peripheral relationship to Department of
Natural Resources, Department of Environmental Conservation
and Department of Fish and Game.
The specific mission alignments affected both the structure
in which federal code was built and in the agency's impact
on that.
Co-Chair John Torgerson wanted to know what the changes in
the proposed committee substitute would do. Bruce Campbell
replied that it added language to the provision of the
merger. It also added language in the planning process
portion to allow it to become optional. He showed where on
page two line 28 "may" was inserted, and was "shall"
deleted. This was repeated in other areas of the bill.
This stipulated that the commissioner "may" engage in a
planning process to determine among other things whether
there were sufficient funds to do the project. Currently,
statute stated that the planning process was required.
Without the change the ability to sell and lease lands
would be difficult for the department.
Co-Chair John Torgerson asked what changes were made in
Section 23. Bruce Campbell answered this was an add-on made
by the Senate Resources Committee and included the shift on
page ten lines 20, 24 and 25 that excluded specific tracts
of land that were included in municipal lease. This
amounted to 939 acres of land where there was overlap
between the Legislatively created public use area and the
contract happening in the Hatcher Pass area. This involved
an agreement to construct a ski resort.
Bruce Campbell continued with other changes made on page
eight to allow the use of electronic technologies for
public notices. This could result in savings and if
successful, the department would be expected to build upon.
The department had asked to remove a coordinating body from
the public notice provision. They felt that was not a
useful function.
Senator Gary Wilken noted the multitude of fiscal notes and
wanted to know which applied to the committee substitute.
Co-Chair John Torgerson answered that probably none applied
since the CS had not been adopted.
Senator Gary Wilken noted a Coastal Policy Council
Resolution. It was not included in the packet and he
wanted it distributed for member's consideration.
Senator Randy Phillips moved to adopt CS SB 140 Version "N"
as a Workdraft. Without objection, it was adopted.
GABRIELLE LAROCHE, Acting Director, Division of
Governmental Coordination, Office of Management and Budget,
Office of the Governor and Program Coordinator, Alaska
Coastal Management Program, testified in opposition to the
bill.
The sixteen-member policy council, who had prepared the
resolution opposing the legislation that Senator Gary
Wilken spoke of, was comprised of nine locally elected
governmental officials. Also, she noted that no one who had
testified before the Senate Resources Committee was in
favor of the bill.
The sponsor staff stated that this was a mission alignment
and efficiency bill. In response, she had three points that
disproved that. First, the missions of the two agencies
were different. Second, no savings to the state general
fund could be identified with this legislation. Finally,
previous legislative audits found the Division of
Governmental Coordination was the most appropriate agency
for administering the Alaska Coastal Management Program.
She spoke to the conflict of interest in the missions and
mandates of the Division of Governmental Coordination and
the Department of Natural Resources. One of the main
functions of the DGC was to make determinations and provide
conflict resolutions between the Department of Natural
Resources, Department of Environmental Conservation,
Department of Fish and Game, developers and other
interested parties.
The bill could result in increased start-up costs when
combining the agencies. Although there would be savings in
the elimination of the director position, it would be
offset by other costs such as position reclassifications
and hiring procedures associated with the transfer.
Short-term inefficiencies were also anticipated. A
changeover of the lead agency would require an amendment to
the federal program approval. She described the steps
required in this process. Delays or decreases in federal
funding would not only impact state agency functions, but
also pass-through dollars provided to coastal districts and
communities in the state.
Gabrielle LaRoche told the committee that the director's
position, which was proposed to be assigned to the Division
of Land, would not qualify for full federal funding since
the position would have other duties beside the coastal
management program. The difference would have to be made
up.
She repeated her argument that the Office of the Governor
was the best location for the Alaska Coastal Management
Program.
JANE ANGVIK, Director, Division of Lands, Department of
Natural Resources, testified via teleconference from
Anchorage. She opposed the bill and had two points to make.
The first was that the Division of Governmental
Coordination and the Department of Natural Resources were
very different and performed different functions.
The Division of Lands functioned as the owner of the state
lands and made decisions on how to best use the state's
resources. The Division of Governmental Coordination on the
other hand was a permitting agency that attempted to
resolve conflicts between parties whether they affected
state, federal or private lands.
Secondly, she believed the intention was to make the
planning process optional for the Division of Lands. She
disagreed that funding for the planning functions could be
eliminated since the process would no longer be required.
She also disagreed that with the elimination of the
planning positions, the functions could be taken over by
the personnel from the current Division of Governmental
Coordination. Neither of those perceptions would be
accurate because, she warned.
She talked about the language addressing the planning
requirements and explained that it still required the
division to go through a reasoning process before making
decisions. With no funding or staff to perform that
function, that could not be done.
She stressed that this legislation would not achieve the
objectives of mission alignment stated by the sponsor. She
detailed the different missions of the two agencies.
JOHN BAKER, Assistant Attorney General, Natural Resources
Section, Civil Division, Department of Law, testified via
teleconference from Anchorage. He addressed the
implications of Title 38. He characterized the Department
of Law's concerns with the dispersion as constitutionally
based. The department did not believe that these changes
would make the bill, as written, unconstitutional. However,
he did want to point out that there were constitutional
implications in how the courts would likely construe the
legislation. That would have a direct effect on whether
the legislation would achieve its objective to produce cost
and efficiency savings. Those comments were directed mainly
at Sections 4, 10, 11, 13 and 14 of Version "N" that made
the planning functions optional.
The court under Alaska law would construe all legislation
as avoiding a constitutional conflict whenever possible. To
do that, it would interpret the legislation with its own
view of what the constitution required. The department
believed that the court would view the constitution as
requiring some record of the decision making for all
disposals of land and other state resources in order to
make public participation in that process meaningful. The
department anticipated that the court would require the
Department of Natural Resources to continue to engage in a
process described in Title 38. The legislation could change
the name of the process.
If the goal were to reduce the workload in the planning and
classification functions, this bill would not accomplish
that.
He deferred to Gabrielle LaRoche's comments on the Coastal
Management Program implications.
Senator Al Adams had a question on the constitutionality of
the bill. Was that because the constitution specifically
stated that the government needed a reasonable approach to
land management and that the public was entitled to a due
process? John Baker replied that there were several
sections of Article 8 of the constitution that required
public notice and pointed out the linkage to the
classification and planning process. In a nutshell, the
linkage should be described as that which a record of
decision making was produced. The court required not only
public notice, but meaningful public notice that the public
was able to participate in.
JOHN DUNHAM, Planning Department, North Slope Borough.
Testified via teleconference from Barrow to the items in
the bill relating to the Coastal Management Program. He
was concerned that the move was unneeded and that there
would be no net savings. He was concerned how the Division
of Governmental Coordination activity would integrate
administratively into the Department of Natural Resources.
He talked about the change in employment status from exempt
positions and how that might affect the impartiality or the
expertise of the decision-makers.
He then referred to the land planning process. He detailed
the unfulfilled municipal entitlement situation. He noted
that the North Slope Borough was not the only municipality
in this position and felt this bill would have a larger
impact than the committee realized.
The Division of Lands and the Division of Governmental
Coordination were completely different agencies. He closed
by saying there were no simple answers.
JOHN EASTON, Program Director, Bristol Bay Coastal Resource
Service Area, testified via teleconference from Dillingham
testified against the bill. This would affect the Bristol
Bay Area Plan that included state land classifications and
designations. This plan and others had gone through a full
public process to find the best use.
The Division of Governmental Coordination served its
mission. SB 140 would remove a network system that worked
quite well.
LINDA FREED, Community Development Director, Kodiak Island
Borough testified via teleconference from Kodiak. She had
serious concerns with the state land planning functions.
She felt the bill was short sighted.
The Kodiak Island Borough was opposed to the Coastal
Management Program portions of the bill and did not see the
savings in merging the office with the Department of
Natural Resources. She did not feel that by eliminating the
director's position was advantageous. The director position
played an important part in the process, often as an
arbitrator.
BILL EASTHAM, President, Mat-Su Motor Mushers, testified
via teleconference from Mat-Su in opposition to the Senate
Resources Committee version of the bill. He felt the
Hatcher Pass community would have no control over the area.
KATHY WELLS, Creator, Hatcher Pass Management Plan,
testified via teleconference from Mat-Su in opposition to
the bill. She did not want the Mat-Su Borough to acquire
the land arguing that it did not have the capacity to
properly manage it. She was concerned with the poor public
notice process with this bill.
KAROL KOLEHMAINEN, Program Coordinator, Aleutians West
Coastal Resource Service Area, testified via teleconference
from Mat-Su. She spoke to the concerns of the CRSA with the
bill. She did not support the merging of the two agencies
or the elimination of the planning process requirement. She
also had concerns about funding for the CRSA.
ROBBIE FAGERSTROM, Co-Chair, Alaska Coastal Policy Council,
testified via teleconference from Nome. He requested the
committee members be provided with two letters to use when
making their decisions regarding this bill.
He referenced a Legislative Audit Report that found the
Division of Governmental Coordination was the most
appropriate location for the coastal policy functions.
Tape # 117 Side B 9:57 AM
Robbie Fagerstrom continued.
NANCY MICHAELSON testified via teleconference from
Anchorage regarding the Hatcher Pass Public Use Area. She
told of the area and the many recreational activities her
family and thousands of other South-central Alaskans
enjoyed there. She pointed out that the borough was not
bound by the limitation agreement and was more interested
in developing the land.
MURRAY WALSH, Planning and Development Consultant testified
in Juneau. He felt the provisions in SB 140 would not
accomplish the goals of the permitting process. The only
defense his permit applicants had was the Division of
Governmental Coordination, which served as a referee.
Co-Chair John Torgerson ordered the bill held in committee.
SENATE BILL NO. 67
"An Act relating to taxation, including taxation of
income of individuals, estates, and trusts; and
providing for an effective date."
The Senate Rules Committee at the request of the Governor
introduced the bill.
WILSON CONDON, Commissioner, Department of Revenue
testified. This bill was part of a package of bills that
the Governor had requested with respect to his proposal to
address the long-range financial plan the Legislature and
Governor had been focused on this session.
The Governor included a broad-based tax in his proposed
financial plan because he believed it was needed to fulfill
one of the five key principles that he urged should apply
to any long-range financial plan. That principal was to
maintain and protect a healthy permanent fund dividend.
Both Alaska families and Alaska businesses were in some
way, dependent on the continuation of a healthy permanent
fund dividend program.
Wilson Condon restated the four main elements of the
Governor's plan. One was to transfer $4 billion from the
permanent fund earnings account into the Constitutional
Budget Reserve (CBR) and use earnings from the CBR to pay
for public services. The second key was to invest the CBR
more aggressively. Third was a broad-based tax that would
raise approximately $300-350 million. Finally, for the plan
to continue, another transfer to the CBR would be needed
around 2010.
In the plan presented following the State of the Budget
address, the permanent fund dividend would average slightly
under $1500 a year over the next fifteen years. The
Governor had made it clear that he would be flexible on a
financial plan with respect to the fund in which the money
would be transferred. He was open to more aggressive
investment of the earnings and he was flexible a different
tax than what was proposed in SB 67. However, he believed
that without any additional revenue, the maximum
sustainable permanent fund dividend would be about $800-900
per year no matter how the plan was structured. To use of
the permanent fund to pay for public services and to
continue to pay dividends over $1000, there would need to
be a broad-based tax.
He did the addition to find that $60 million in additional
revenue had the effect of raising the per capita by about
$100 per person a year.
With respect to a broad-based tax, there was one other
general public policy reason that should be considered. The
Commonwealth North committee that looked at the management
of the state's financial resources, pointed out that there
was an "Alaska disconnect". That was defined as economic
development in areas other than the oil and gas industries;
such as mining, timber or investments in transportation,
were activities that made the private sector of the economy
more prosperous, but did not bring more public revenues
that paid for public services. People who moved to the
state and participated in those public service activities
required these.
Wilson Condon repeated the comment that the Governor was
willing to consider any form of broad-base tax. This could
include an income tax, sales tax, motor fuel tax, etc. The
reason Governor Knowles specifically proposed an income tax
were that it would reach out-of-state workers. Also, state
income tax was deductible on federal income tax where sales
tax was not. Finally, the income tax was progressive. It
required more from those who had the ability to pay more
and as some believed, benefited more from the public
services.
The Alaska Credit featured in the tax added to the
progressivity of the tax by making the tax rate a
percentage of the federal tax. In terms of the public
reaction to that, Wilson Condon thought it added to much
progressivity. The public reaction had been that the way
the tax was structured, too few people would pay the tax.
Therefore, the Governor was open to proposals to change the
structure of that tax so that it would address those
perceived difficulties.
A number of the people Wilson Condon talked to
misunderstood the thirty-one percent rate. They thought it
was a thirty-one percent tax rate, when it really was
thirty-one percent of one's federal income tax. His own tax
rate was twenty-eight percent on his taxable income.
Thirty-one percent of that twenty-eight equaled a rate of
taxation of 8.6 percent of his taxable income. If the
Alaska Credit feature were removed, which removed the size
of the tax base and introduced the elevated progressivity,
the tax would be lowered to 5.9 percent.
He returned to his main point that a broad-based tax of
some type was necessary if a health dividend was to be
preserved. It was a balance. It was possible to cover the
budget deficit entirely from the permanent fund earnings.
However, that would eliminate the dividend. On the other
hand, it was probably not possible to cover the entire
budget deficit with taxes. It was too large.
It was a matter of fairness and was a political judgement
that balanced the question of who paid to close the budget
gap, according to Wilson Condon. The Governor believed the
fairest way to do that was to preserve a dividend in the
range that went with his proposal and to put in place a
broad-based tax. This was a fair way of distributing the
burden of balancing the budget.
He again stressed that the Governor was flexible.
Co-Chair John Torgerson asked how long this tax plan would
protect the dividend and the state's savings account.
Wilson Condon used the oil production figures set forth by
the Department of Revenue's Spring forecast for the next
five years and the Fall revenue forecast for the period
thereafter. The projections for a flat-line budget over the
next fifteen years, without taking some other action,
showed the CBR depleted by 2014.
Senator Loren Leman had questions on the Governor's tax
proposal. He remembered the rate on the previous personal
income tax was sixteen percent. Wilson Condon didn't
believe that was correct. He thought it was fourteen
percent.
Senator Loren Leman said that he had paid the income tax
and he certainly was not in the higher income categories at
the time.
DEBORAH VOGT, Deputy Commissioner, Department of Revenue
said the rates had been graduated starting at three-percent
and went up to 14.5 percent. The highest rate applied to a
taxpayer who was single and with an income over $150,000
annually. She clarified that that was a percentage of the
federal tax.
Senator Loren Leman then voiced concern with the creation
of another bureaucracy to collect and audit the tax. There
was also a similar administration to distribute the
permanent fund dividend. This did not make sense to him.
He noted that some felt there was a social benefit of
taking from producers of income and redistributing to those
who did not produce incomes.
One goal of the Legislature was to have as lean and
efficient a government as possible.
He asked for response to the dual mechanism.
Wilson Condon said the answer was both very simple and very
complex. It was a policy choice whether to have both
programs. If there were both, there would need to be
administration for both. It was a question of what people
felt was fair.
Senator Pete Kelly had a question on comments made about
the fairness issue. The argument the witness gave was that
a tax on higher income was justified because it was
believed those people were the ones who most benefited from
government services. Senator Pete Kelly didn't think those
people were the ones who mostly used the programs of the
Department of Health and Social Services, the Department of
Public Safety or the Power Cost Equalization program.
Wilson Condon said there was not a true answer to who
benefited. He felt he had as much or more of a stake in
government services. He did not pay as much for what he got
from roads, airports, etc. He had a big stake in the
economy having a well-educated workforce. It was important
to have a state park system where he could go camping. He
saw himself as having a tremendous stake in Alaska's future
than people of lesser means. More possibilities were made
available to him as a consequence of his having a higher
income. Others would evaluate that differently and he
didn't think there was a right answer.
When talking about fairness in the tax system, there were
four considerations. One was whether taxes should be
collected on an ability to pay basis. There was the matter
of collecting taxes on the use of services. He noted there
were many services he received that he did not pay for. The
third consideration was that of horizontal equality. This
was the determination of whether individuals in the same
situation paid comparable amounts. The final consideration
addressed whether those who could pay more should pay more.
There were no true answers to any of those debates but they
were value choices that the Legislature had to make when
deciding how to pay for public services.
Senator Pete Kelly noted that most of the services the
witness mentioned were paid by federal funds: roads,
airports, public education and parks. When talking about
fairness, it was a different debate in paying for use of
services. He detailed his argument on fairness. He believed
people should not be taxed for the reason that they
benefited more from general fund dollars if in fact they
didn't.
Senator Gary Wilken asked if S-Corps were treated as
individual incomes in this proposal. He wanted to know
that if a S-Corp had before-tax earnings of $1 million and
if thirty-one percent of the thirty-nine percent federal
tax rate was taken the S-Corp would then pick up an
$120,000 obligation. Wilson Condon said if it was a solely
owned S-Corp, it would. Senator Gary Wilken was afraid
that would be the answer. Wilson Condon qualified that the
affect of the Alaska Credit feature would have the affect
of raising the rate by about 40-50 percent on the remaining
tax base. This was because the S-Corp itself would not be
receiving a permanent fund dividend.
Deborah Vogt clarified that the S-Corp would not pay this
tax, the individual to whom the income was distributed
would. That person would probably be eligible for the
credit.
Senator Gary Wilken noted discrepancies on the additional
positions requested in the handouts. The Governor's Tax
Plan on page 13 showed an increase of 56.7 positions while
page 12 appeared to be 87 positions. Wilson Condon was
unsure about that. Co-Chair John Torgerson asked for the
correct information to be provided.
Senator Sean Parnell wanted to know how many people would
be paying the tax on an annual basis for the first five
years. Deborah Vogt did not have the exact figures. She
estimated it would not be less than 75,000.
Senator Sean Parnell wanted to know how much of that
revenue would come from out-of state workers. The
department did not have that information prepared. Wilson
Condon only had a table that broke down the tax revenue by
income. Senator Sean Parnell asked what the department was
attempting to estimate. Wilson Condon answered they wanted
to determine both the number of taxpayers and the
proportion of the tax that would be raised by the various
brackets of federal taxable income.
Senator Sean Parnell wanted to know how much of the $350
revenue would be paid by out-of-state residents. Wilson
Condon said it would be between $35 and $50 million.
Senator Sean Parnell calculated that Alaskan residents
would then pay about $300 million.
Senator Sean Parnell returned to the term "broad-based
tax." No matter how he looked at it, less than one-sixth
of the population and less than one-third of the wage
earners would pay the tax. This estimation was based on all
the information provided not just today's testimony. Wilson
Condon answered that the Alaska Feature narrowed the base
considerably. As he testified, if the Legislature were to
impose a tax, it would need to have a broader base.
Senator Sean Parnell wanted to know the economic impact.
Wilson Condon said the tax imposed would have the effect of
taking money out of the economy the same as reductions in
PFD dividends.
Senator Sean Parnell asked if it would result in higher
paying jobs going elsewhere and a decrease in higher paying
jobs. Wilson Condon did not know. Senator Sean Parnell
asked if that was because research had not been done or the
research was unable to determine. Wilson Condon said it
was because it was not yet done. He did not know of a
reason why there would be a greater loss of jobs at the
high end of the income spectrum. Senator Sean Parnell
thought there was intent to create higher income jobs. He
wondered if this tax was counter to that goal.
Senator Lyda Green said it appeared that this plan would
allow broad-scale use of personal information from one
agency to another. This would be intermingled with the
permanent fund. She wanted to know if when the permanent
fund was created, was there any implication that the
information gathered would be protected.
Deborah Vogt answered that there was a list of agencies
that had access to PFC information to some extent. Some
restrictions on the data were statutory and some were
regulatory. Some came about only at the advice of the
Attorney General. All the names and addresses were public
information. Social security number and other information
was fairly limited. The permanent fund program was in Title
43, the tax program, and was subject to the same
confidentiality as the tax information. She therefore
concluded that the two agencies were close enough that
there could be a sharing of information.
Senator Lyda Green asked if the same held true for child
support programs. Deborah Vogt responded that the Child
Support Enforcement Division had access to almost all of
the information on the dividend application.
Senator Lyda Green referred to cross-match employer
quarterly report filings to the Department of Labor and
wanted to know if that to obtain information of the number
of people a corporation was hiring. Deborah Vogt answered
that it was not. She explained that the employer
withholding funds would go through the Department of Labor.
The employee paycheck would have funds withheld for state
tax just as it did for federal tax.
Tape: SFC - 99 #118, Side A 10:44AM
Co-Chair John Torgerson pointed out that the savings,
except for the corpus of the permanent fund would run out
in the year 2014. He wanted to know what was the plan for
after the year 2014. Wilson Condon disagreed with the
assumption. He predicted the CBR would be empty by 2014.
However, if that were true, and there was no other
additional revenue, other steps would be necessary. More
transfers to the CBR would be required based on the
projections the department was currently doing.
Senator Sean Parnell offered a motion to move SB 67 from
committee with individual recommendations. He noted this
proposal reflected a very different view of financing
government than he had. Senator Dave Donley commented he
disagreed with the bill and did not think it should move
from committee without a statement of "no recommendation."
Senator Pete Kelly felt a statement in opposition should be
made on the Senate floor.
Senator Pete Kelly wanted to vote to move the bill from
committee because he wanted to make a statement on the
Senate floor in opposition to it. There were a lot of
discussions across the state about different sources of
revenue. The Governor had proposed an income tax and he was
willing to let it go to the whole Senate to get the
reaction of all the Senators.
Senator Loren Leman had not heard a compelling argument for
income tax. He would not oppose moving from committee but
would cast a no vote on in Senate Chambers.
Senator Al Adams would vote against moving the bill from
committee. His reasons were because he believed the long-
range plan was still being worked on and should be drafted
before the income tax options were eliminated.
AT EASE 10:48 AM / 10:50 AM
Senator Sean Parnell amended the motion to move SB 67 from
committee with a committee recommendation of "do not pass."
Senator Al Adams noted this was the last committee of
referral and the uniform rules requiring at least one "do
pass" from a committee must be followed. Co-Chair John
Torgerson suggested the uniform rules could be suspended on
the Senate floor.
There was no objection and the bill moved from committee
with a "do not pass" recommendation.
ADJOURNED
Senator Torgerson adjourned the meeting at 10:52 AM.
SFC-99 (1) 5/3/99
| Document Name | Date/Time | Subjects |
|---|