Legislature(1993 - 1994)

03/11/1994 01:35 PM JUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                   SENATE JUDICIARY COMMITTEE                                  
                         March 11, 1994                                        
                           1:35 p.m.                                           
  MEMBERS PRESENT                                                              
 Senator Robin Taylor, Chairman                                                
 Senator George Jacko                                                          
 Senator Dave Donley                                                           
 Senator Suzanne Little                                                        
  MEMBERS ABSENT                                                               
 Senator Rick Halford, Vice-Chairman                                           
  OTHERS PRESENT                                                               
 Senator Bert Sharp                                                            
  COMMITTEE CALENDAR                                                           
 HOUSE BILL NO. 71                                                             
 "An Act relating to the involuntary dissolution of Native                     
 corporations; and providing for an effective date."                           
 HOUSE BILL NO. 280                                                            
 "An Act adopting the Uniform Custodial Trust Act."                            
 HOUSE BILL NO. 415                                                            
 "An Act making corrective amendments to the Alaska Statutes as                
 recommended by the revisor of statutes; and providing for an                  
 effective date."                                                              
 SENATE BILL NO. 332                                                           
 "An Act relating to the method of calculating the weight of live              
 marijuana plants for purposes of applying controlled substance laws           
 and amending the definition of `marijuana'."                                  
 SPONSOR SUBSTITUTE FOR SENATE BILL NO. 223                                    
 "An Act relating to credits against certain taxes for contributions           
 to certain public educational radio and television networks and               
 stations; and providing for an effective date."                               
 SENATE BILL NO. 256                                                           
 "An Act increasing the tax on transfers and consumption of aviation           
  PREVIOUS SENATE COMMITTEE ACTION                                             
 HB 71 -  See Community & Regional Affairs minutes dated                       
          4/28/93.  See Judiciary minutes dated 3/9/94.                        
 HB 280 - See State Affairs minutes dated 3/2/94.  See                         
          Judiciary minutes dated 3/9/94.                                      
 HB 415 - See Judiciary minutes dated 3/9/94.                                  
 SB 332 - See Judiciary minutes dated 2/11/94.                                 
 SB 223 - See Community & Regional Affairs minutes dated                       
 SB 256 - See Transportation minutes dated 1/27/94.                            
  WITNESS REGISTER                                                             
 Lt. Charles Mallott, Commander                                                
 Investigation & Support Services                                              
 Ketchikan Police Department                                                   
 361 Main Street                                                               
 Ketchikan Alaska 99901                                                        
   POSITION STATEMENT: Supports SB 332.                                        
 Cheri Davis                                                                   
 Box 5723                                                                      
 Ketchikan, Alaska 99901                                                       
   POSITION STATEMENT: Supports SB 332.                                        
 Lynda Adams                                                                   
 Alaskans for a Drug Free Youth                                                
 2557 Tongass                                                                  
 Ketchikan, Alaska 99901                                                       
   POSITION STATEMENT: Supports SB 332.                                        
 Sallie Dodd-Butters                                                           
 P.O. Box 1223                                                                 
 Homer, Alaska 99603                                                           
   POSITION STATEMENT: Opposes SB 332.                                         
 Julie Cesarini                                                                
 P.O. Box 812                                                                  
 Homer, Alaska 99603                                                           
   POSITION STATEMENT: Opposes SB 332.                                         
 Margot Knuth, Asst. Atty. General                                             
 Criminal Division                                                             
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska 99811-0300                                                     
   POSITION STATEMENT: Supports SB 332.                                        
 Rob Rawls                                                                     
 Alaska Public Radio Network                                                   
 810 E. Ninth Ave.                                                             
 Anchorage, Alaska 99510                                                       
   POSITION STATEMENT: Supports SB 223.                                        
 Helvi Sandvic, Deputy Commissioner                                            
 Department of Transportation                                                  
 3132 Channel Drive                                                            
 Juneau, Alaska 99801-7898                                                     
   POSITION STATEMENT: Opposes SB 256.                                         
 Gary Moore, Planning Director                                                 
 Tanana Chiefs Conference                                                      
 OFFNET from 452-8251                                                          
 Fairbanks, Alaska                                                             
   POSITION STATEMENT: Opposes SB 256.                                         
  ACTION NARRATIVE                                                             
 TAPE 94-15, SIDE A                                                            
 Number 001                                                                    
  CHAIRMAN ROBIN TAYLOR  called the Judiciary Committee meeting to             
 order at 1:35 p.m.                                                            
 reviewed the problems of Native land titles solved by the passage             
 of HB 71.  There was a discussion of the number of corporations               
 involved with this problem.                                                   
 SENATOR JACKO moved to pass HOUSE BILL NO. 71 (DISSOLUTION OF                 
 NATIVE CORPORATIONS) from committee with individual                           
 recommendations.  Without objections, so ordered.                             
 Number 053                                                                    
 SENATOR TAYLOR returned HB 280 (UNIFORM CUSTODIAL TRUST ACT) to               
 committee and reviewed the discussion by DAVID DIERDORFF, Revisor             
 of Statutes, on the legislation.                                              
 TRUST ACT) from committee with individual recommendations.  Without           
 objections, so ordered.                                                       
 SENATOR TAYLOR returned HB 415 (1994 REVISOR'S BILL) to committee.            
 SENATOR LITTLE moved to pass CS FOR HOUSE BILL NO. 415(JUD) from              
 committee with individual recommendations.  Without objections, so            
 sponsored by the Senate Judiciary Committee, and invited LT.                  
 CHARLES MALLOTT, Commander for the Ketchikan Police Department, to            
 testify by teleconference.                                                    
 LT. MALLOTT began by pointing out that presently their police                 
 department has been addressing the current mandate that involved              
 processing a large growing operation of 200 marijuana plants, and             
 this has entailed many personnel hours harvesting, hanging, drying,           
 and then plucking the buds and leaves from the stems.  He explained           
 the two hundred mature marijuana plant growing operation took the             
 narcotics enforcement team approximately 32 officer hours to                  
 process.  He thought it was a real waste of resources that could be           
 better allocated time wise.                                                   
 Number 103                                                                    
 LT. MALLOTT described the growing operation of 200 marijuana plants           
 as a large growing operation complete with an irrigation system,              
 lighting equipment, utility records, potting soil, plants, and                
 fertilizer.  He explained all of these items were photographed, but           
 the processing just wasn't practical.                                         
 LT. MALLOTT hoped there could be a number of plants that would be             
 the determination as to a felony cutoff or a misdemeanor cutoff.              
 He discussed having to deal with specific weights, and he quoted              
 the current law dealing with the finished product.  He thought it             
 would be a big help for small agencies if that could be changed in            
 SB 332 so the plants could be cut off at the stem and weighed at              
 the time of harvest.  He argued that even thought not all of the              
 plant was smoked, the plant is still an illicit plant.                        
 SENATOR TAYLOR invited former representative, CHERI DAVIS to                  
 testify from Ketchikan.                                                       
 MS. DAVIS testified in support of SB 332 explained how she thought            
 it would save money in law enforcement.  In talking to persons on             
 the street in Ketchikan, she commented they thought the process was           
 crazy.  She urged that the legislation be passed quickly to free up           
 the police for more important duties.                                         
 Number 142                                                                    
 LYNDA ADAMS also testified from Ketchikan on behalf of Alaskans for           
 a Drug Free Youth, and she indicated support for the bill from the            
 Governor's Advisory Board on Alcoholism and Drug Abuse, as well as            
 the Ketchikan Mayor's Task Force on Substance Abuse.  She thought             
 the current process was a handicap for law enforcement.                       
 From Ketchikan, SENATOR TAYLOR moved on to Homer, Alaska to hear              
 first from SALLIE DODD-BUTTERS.                                               
 MS. DODD-BUTTER claimed the police were spying on people in their             
 back yards.  In regards to the 4 oz rule, she suggested the police            
 dry and weigh one plant, and use a formula to decide how much is              
 lost in the stems and "things," to decide the amount.  She declared           
 the whole process was fascist and ridiculous.  She also thought               
 cigarettes and alcohol use should be pursued rather increasing                
 marijuana seizures.  She claimed to have been a marijuana smoker              
 since 1966, has had a successful life, and deeply resents this                
 intrusion on her civil liberties.                                             
 Number 208                                                                    
 Next to testify from Homer was JULIE CESARINI, who spoke in                   
 opposition to SB 332, and reviewed her knowledge of the hemp plant,           
 including the importation of hemp cloth from China.  She demanded             
 to know what scientific evidence was being used to calculate the              
 amount of mind altering qualities in the stalk.  She thought the              
 troopers should be freed to pursue people who are committing                  
 vicious and anti-social crimes.  She urged the committee to read              
 the information on hemp, which she claimed was a most healthy                 
 SENATOR TAYLOR explained the legislation only defines the manner in           
 which the plant of marijuana would be weighed, and he asked if she            
 knew a better way to weigh the plant.                                         
 MS. CESARINI explained the weight was arbitrary, and should only be           
 the weight of the buds, excluding the seed, leaves, stalks, and               
 roots.  She said the buds were the mind altering portion of the               
 Number 252                                                                    
 SENATOR LITTLE asked if the buds were the portion being weighed.              
 SENATOR TAYLOR called on MARGOT KNUTH with the Criminal Division              
 from the Department of Law to answer some of the questions.                   
 MS. KNUTH explained the Department of Law supports the provision in           
 the bill that will allow the entire marijuana plant to be weighed,            
 including the stalk.  She quoted the definition as set out in                 
 present statute is the seeds, leaves, buds, and flowers, but not              
 the stalk.  Adding the stalk, she said would allow the prosecution            
 to reach the one pound level sooner.                                          
 MS. KNUTH addressed the new language at the time of harvest or                
 seizure and presented a practical problem of having the plants rot            
 if not dried, and secondly, it is the State's burden of proof in              
 criminal cases beyond a reasonable doubt.  She said the weight of             
 the plant needs to be the same at the time the case goes to the               
 jury as has been charged, and she gave an example.                            
 MS. KNUTH reiterated the Department's support for SB 332 -                    
 especially Section 2, but she suggested the phrase on page 1, lines           
 9 and 10, [WHEN REDUCED TO ITS COMMONLY USED FORM] be reinstated.             
 Number 298                                                                    
 SENATOR DONLEY questioned the amount of time saved since most of              
 the time seemed to be in the drying out process.                              
 MS. KNUTH said it would still have to be dried, but with the weight           
 it would be more for the product.                                             
 SENATOR DONLEY protested it would never get passed a judge, and MS.           
 KNUTH thought the matter could be addressed by changing the                   
 language to include "dried" weight.                                           
 SENATOR JACKO asked about the stalks not having THC, and SENATOR              
 DONLEY confirmed there was nothing in the stalk that is mind                  
 altering, but the whole stalk is illegal.                                     
 SENATOR DONLEY agreed there was a compelling reason behind the                
 bill, because there is a considerable waste of resources for law              
 enforcement officers to be processing this illegal substance.  He             
 also agreed there had to be a preservation of the evidence, but he            
 was concerned there would be nothing done but increasing the                  
 penalty for smaller amounts of the drug.                                      
 MS. KNUTH was hoping there would be a difference between processing           
 and simply drying it, so it remains unspoiled evidence.  She said             
 the prosecution had no interest in processed marijuana, but they do           
 need the marijuana to be a stable amount.                                     
 SENATOR TAYLOR expressed concern for the officer who initiate the             
 process, and talked in terms of fishing violations where just                 
 samples were saved.  Illegal fish are sold and the fish ticket is             
 preserved for evidence.  He questioned whether truck loads of                 
 marijuana would be saved, rather than just samples and the                    
 Number 350                                                                    
 SENATOR DONLEY, a lawyer, declared he could beat that scenario in             
 court, and asked about the fish.  There ensued a discussion between           
 SENATOR DONLEY and SENATOR TAYLOR about fishing violations,                   
 penalties, higher standards, evidentiary process, and the lack of             
 logic in the different violations.                                            
 SENATOR TAYLOR asked MS. KNUTH about processing a large growing               
 operation, and she suggested Public Safety could provide more                 
 information on these facts.  She described her position as a                  
 prosecutor and the manner in which she presented marijuana as                 
 SENATOR DONLEY clarified the difference from existing law is that             
 the stocks would be included in the dried product, and he asked               
 what the difference would be in the aggregate weight.  He wanted to           
 know how many people would be moved into a felony category, and he            
 also wanted to know the status of the initiative thrown out by the            
 superior court.  He asked MS. KNUTH if her division had appealed              
 the decision.                                                                 
 MS. KNUTH said her division had not, but she thought it was a                 
 district court from Southeast Alaska, possibly Ketchikan, that                
 curtailed it in that area.  She explained there was a supreme court           
 decision that if the court did not appeal an adverse decision, the            
 prior law would prevail.  MS. KNUTH quoted a supreme court opinion            
 that says it doesn't have binding effect in another judicial                  
 SENATOR DONLEY didn't think it was binding completely, but there              
 was room to maneuver, and asked if the decision was published.                
 Number 398                                                                    
 MS. KNUTH explained, at this point, the department has no statewide           
 ruling that says the amendment was unconstitutional, but she                  
 thought the superior litigation was still ongoing, where the                  
 amendment was attacked by a right-to-privacy group.  She said it              
 was stalled out on the plaintiff's burden of proof, and they                  
 continued to discuss the constitutionality of the suit.                       
 SENATOR DONLEY thought the initiative was still good, but he was              
 unclear as to whether it made all possession of marijuana a felony.           
 MS. KNUTH said it became a misdemeanor offense that could be                  
 prosecuted to possess, even your own home, but it would require               
 law enforcement officers to have a reason to be there. If the                 
 officers enter on a search warrant for some other offense and find            
 marijuana, prosecution could be initiated.  There was a discussion            
 of quantity cutoffs for marijuana.  She said one pound was the                
 felony cutoff.                                                                
 SENATOR DONLEY indicated that was a beginning point for a                     
 discussion on the impact of prosecutions by including the stalks,             
 and he opined there would be more people prosecuted on felony                 
 crimes as opposed to misdemeanors.  He claimed there would also be            
 an impact on the fiscal note with the increase in felony crimes,              
 and he asked the committee if that was what they really wanted.               
 SENATOR DONLEY also asked if the committee was actually addressing            
 a procedural and a time problem.  SENATOR TAYLOR thought the focus            
 was in solving the actual practical problem of handling this                  
 contraband subsistence in the manner in which it would have to be             
 stored, collected, and saved.                                                 
 SENATOR TAYLOR turned to LT. MALLOTT in Ketchikan to respond to               
 some of the practical concerns.                                               
 LT. MALLOTT explained the actual harvesting of cutting off the                
 plant at the base and hanging it up in a room to dry, is not as               
 time consuming as the physical process of taking each marijuana bud           
 off the plant and storing various parts independently.  He claimed            
 the major time consuming process is the grooming, and he explained            
 it took 32 officer hours grooming the 200 plants seized in a recent           
 LT. MALLOTT explained if they could weigh the entire dried plant it           
 would be less time consuming, and he objected to having to deal               
 with the time consuming procedures mandated by law.                           
 Number 452                                                                    
 SENATOR DONLEY indicated a great deal of sympathy for the plight of           
 LT. MALLOTT and thought the process was ridiculous.  However, he              
 noted the relevant factor to the amount of an illicit substance,              
 and gave the analogy of how large a theft is involved in a crime.             
 He thought the punishment should fit the crime and be done in a               
 rational manner.  He expressed concern the change in the bill would           
 change the level of punishment which would bring about fiscal and             
 social impacts.  He again asked the committee members what they               
 were trying to do.                                                            
 LT. MALLOTT explained in his eighteen years experience, extremely             
 few cases were involved at or near the one pound level, so he                 
 thought it would effect a small number of cases.  His concern was             
 the growing operation of 50 or 75 plants, where there is obviously            
 more than a pound, and he thought it was a waste of resources to              
 continue to process all those plants.                                         
 SENATOR DONLEY agreed it was a waste of resources but could be                
 fixed without the increase in penalty for possession to do that,              
 and he led a discussion of rational ratio adjustment in a felony v.           
 a misdemeanor.                                                                
 LT. MALLOTT did not see the bill as increasing penalties so much as           
 trying to make it simpler for law enforcement to obtain a usable              
 weight in a large growing operation.                                          
 SENATOR TAYLOR reviewed the interchange with SENATOR DONLEY on the            
 points of the legislation dealing with the inclusion of the stalks            
 in the grooming of the marijuana, making a major impact on breaking           
 through the borderline of felony v. misdemeanor.  SENATOR TAYLOR              
 quoted SENATOR DONLEY'S idea for a formula to allow for the stalks            
 to be of a certain percentage of the groomed weight.  SENATOR                 
 DONLEY agreed with his assessment of the problem.                             
 Number 508                                                                    
 MS. KNUTH questioned MR. MALLOTT if someone had dried weight that             
 included the stalk making it over a pound, would that still be a              
 quantity that could be arguably "personal use."  Or would it be a             
 commercial quantity when the amount is over a pound including the             
 MR. MALLOTT was not aware of anyone has been in possession of more            
 than a pound of groomed and processed marijuana for their personal            
 use.  He described various times at which a marijuana plant could             
 be harvested, and he gave an example of finding 1000 starter                  
 plants, two inches high, but which might not contain a pound of               
 useable product.  He expressed appreciation at the struggles by the           
 legislators to address his problem, and he restated his dilemma as            
 continuously discussed.                                                       
 SENATOR DONLEY suggested using the standard of so many pounds of              
 total weight or so many plants, saying he would be suspicious of              
 anyone with 100 plants.                                                       
 SENATOR TAYLOR talked about MS. KNUTH'S amendment to insert "dried"           
 on page 1, line 8, before the word "weight."  MS. KNUTH suggested             
 placing a period after the word "attachments" on line 9 on page 1.            
 SENATOR LITTLE clarified the weight at seizure would not be the               
 dried weight.                                                                 
 SENATOR DONLEY clarified the use of "dried weight" in the sentence,           
 line 8, page 1.  He said he was also interested in the using the              
 number of plants as an issue, and there was some discussion of this           
 among the committee members.                                                  
 Number 550                                                                    
 SENATOR DONLEY gave some examples for getting a search warrant for            
 probable cause for large scale marijuana crops, along with some               
 concerns that 200 small plants might not fit the definition.                  
 MS. KNUTH explained AS 11.71.040 is misconduct involving a                    
 controlled substance in the fourth degree, which is a class C                 
 felony, and she explained how a subsection (g) could be added to              
 describe the number of plants, which would be the cutoff level.               
 SENATOR TAYLOR asked MS. KNUTH if she thought it had to be a dried            
 product, and she quote some statutory authority consistent with the           
 need from an evidentiary stand point.                                         
 After some discussion, SENATOR DONLEY proposed some provisions for            
 total numbers of plants, along with some adjustment in total weight           
 as a felony, taking into consideration the stalks.                            
 SENATOR TAYLOR asked MS. KNUTH to work with the committee and his             
 aide, KEVIN, to amend the bill for a future hearing.  SENATOR                 
 DONLEY admitted to having some constitutional qualms about the                
 lower levels within a person's home and the privacy clause of the             
 constitution.  He thought there was a compelling state interest in            
 regulating the substance, which goes beyond the constitutional                
 right to privacy.                                                             
 SENATOR TAYLOR expressed concern that persons may have in their               
 homes a substance which we cannot purchase, transport, receive by             
 gift, or sale and can only appear on his dining room table by                 
 immaculate reception.                                                         
 SENATOR TAYLOR thanked all who worked on the legislation, asked for           
 additional ideas, and promised copies of a proposed committee                 
 substitute to the LIO in Ketchikan.                                           
 TAPE 94-15, SIDE B                                                            
 Number 001                                                                    
 SENATOR TAYLOR introduced his bill, SB 223 (TAX CREDIT: GIFTS TO              
 PUBLIC BROADCASTING) to committee and explained it was "An Act                
 relating to credits against certain taxes for contributions to                
 certain public educational radio and television networks and                  
 stations; and providing for an effective date."  He said the bill             
 was really intended to provide for Alaska Public Radio and                    
 television an opportunity to get off of the State general fund, but           
 he admitted the process could lose some general funds. He didn't              
 think the State would lose quite the amount as suggested by the               
 Department of Revenue, who indicates the fiscal note on this bill             
 is $122,250,000.                                                              
 There was some raillery about the funding of other educational                
 SENATOR TAYLOR called on ROB RAWLS in Anchorage, to testify.                  
 MR. RAWLS said SB 223 provides a challenge to public broadcasters             
 in Alaska to see how effective they can be in attracting new                  
 businesses to become involved in underwriting the cost of                     
 programming, and getting current contributors to increase their               
 contributions to public broadcasting with private funds.  He                  
 thought it would mean less demand on the capital budget.                      
 MR. RAWLS explained SB 223 has the potential to bring substantial             
 new federal dollars to Alaska through a new CBB funding formula               
 negotiated last year in Washington, D.C. with the support of                  
 SENATOR TED STEVENS.                                                          
 MR. RAWLS said as of October 1, 1994 stations which are Native                
 licensed, located in rural areas, are eligible for a higher level             
 of federal matching dollars to fund public broadcasting stations.             
 He said it was an important new flow of federal funds to rural                
 Alaska, and he claimed Bethel and Barrow will now receive over $25            
 in federal matching funds for every $100 they can raise themselves.           
 MR. RAWLS explained the Alaska Public Radio Network is facing                 
 difficult times as well, and for the first time the membership is             
 looking at cutting back programs such as Alaska News Nightly, or              
 eliminating the morning news.  He said this bill would be a                   
 valuable tool for the network to attract new underwriters, which              
 would be necessary to continue to offer news and information to               
 SENATOR TAYLOR questioned the qualifications as an Native community           
 entitled to the 25%.                                                          
 MR. RAWLS explained CBB established the qualifications as having              
 more than 50% Native Alaskans on their Board of Directors, 50%                
 Native Americans in their audience, and the other criteria would be           
 50% Native Americans on the staff.  He said it is an important                
 piece of legislation for rural Alaska radio stations.                         
 Number 045                                                                    
 SENATOR TAYLOR asked if the station had to qualify on all three               
 MR. RAWLS explained there was another requirement for rural                   
 stations if it is a sole signal providing the only public                     
 broadcasting, the station can also qualify for increased match for            
 the dollars raised.                                                           
 After some discussion among the members, SENATOR TAYLOR asked if              
 the station had to meet all of the criteria, and MR. RAWLS said               
 that meeting the 50% of board members, automatically qualified the            
 station, but he thought the station had to meet two out of the                
 three if they didn't have the 50% board members.  SENATOR TAYLOR              
 thought his area could meet those qualifications.                             
 SENATOR DONLEY explained the persons currently giving the amounts             
 would also qualify for the 50% tax credit, and he didn't think this           
 met the goal of getting more money for public broadcasting.  He               
 thought it only reduced income to the state treasury, and he                  
 contended there should be a threshold beyond which a present                  
 corporation contributes, in order for them to receive the credit,             
 as an incentive for people to give more.                                      
 SENATOR TAYLOR and SENATOR DONLEY said there was a need to reach              
 for new money, and SENATOR DONLEY said this formula as in current             
 statute, does not encourage new money.                                        
 In another complaint, SENATOR DONLEY expressed a concern as to                
 where the process would end, and he explained he had opposed it for           
 the universities.  He listed both universities and public radio as            
 being worthy recipients, but he also thought domestic shelters and            
 other non-profits as being equally deserving and perhaps more                 
 important than public broadcasting.  He used the proliferation of             
 gaming in Alaska as an argument for his point that others will want           
 to be included in the formula of tax and credits.                             
 Number 105                                                                    
 SENATOR TAYLOR said he would prefer to spend his income taxes on              
 his own preferences, which resulted in some raillery on the                   
 223 (TAX CREDIT: GIFTS TO PUBLIC BROADCASTING) from committee.                
 SENATOR DONLEY objected as being consistently opposed to credits.             
 SENATOR TAYLOR called for a vote to move SB 223 from committee.               
 The roll was taken with the following results:  SENATORS TAYLOR,              
 JACKO, and LITTLE voted "yea," and SENATOR DONLEY voted "nay."                
 SENATOR TAYLOR stated the motion carried and SB 223 was passed from           
 SENATOR TAYLOR introduced SB 256 (INCREASE AVIATION FUEL TAX)                 
 sponsored by the Senate Transportation Committee at the request of            
 the Department of Transportation, and invited SENATOR BERT SHARP to           
 review the bill.  SENATOR SHARP noted the committee would be                  
 considering CS for SENATE BILL NO. 256(TRA).                                  
 SENATOR SHARP reviewed some of the history of supporting rural                
 airports through landing fees.  Last session, air carriers were               
 contacted and asked if they would prefer reinstatement of the                 
 landing fees or collection of an equivalent amount of revenue                 
 through another means.  While no firm commitment was made, the                
 general feeling expressed was that an increase in the aviation fuel           
 tax to collect an equivalent amount of revenue would be preferable,           
 since collecting landing fees was expensive and not always                    
 SENATOR SHARP said the bill would increase aviation and turbine               
 fuel tax in the amount of $.007/gallon, which would generate $1.6             
 million which would be needed to support the airports.                        
 SENATOR LITTLE clarified the amount of the tax, and SENATOR SHARP             
 assured the committee it was not a tax increase.                              
 SENATOR TAYLOR invited HELVI SANDVIC, Deputy Commissioner for the             
 Department of Transportation, to testify.                                     
 Number 153                                                                    
 MS. SANDVIC praised SENATOR SHARP for presenting the issue, and she           
 explained that DOTPF undertook an effort several years ago to help            
 off set the costs of maintenance and operation of their airports.             
 He said an analysis of the airports supported by the general fund             
 and determined the airports receiving certificated air service were           
 most costly due to the mandated federal requirements.  The decision           
 at that time, she explained was to go forth with landing fees                 
 applied to aircraft of 6,000 pound or greater, which are the type             
 of aircraft that require the additional presence of state forces to           
 respond in the event of a crash or with law enforcement response              
 MS. SANDVIC said there was significant opposition to any increase             
 in fees and several alternatives were suggested including the                 
 landing fees, with an increase in fuel tax being the other.  It was           
 decided to go forth with the landing fees; it was challenged in               
 court, and was ruled against them because they had not followed the           
 Administrative Procedures Act for implementing the landing fee that           
 was no longer valid.                                                          
 MS. SANDVIC said the preference, as stated by the air carriers, was           
 to apply a fuel tax increase was the most equitable means of                  
 sharing the cost of maintaining the airports among all aviation               
 users, and she claimed the proposed fuel tax would result in the              
 same amount of revenue that would have been coming into the State             
 had the landing fee proposal gone forward.                                    
 SENATOR LITTLE asked MS. SANDVIC about the consideration from the             
 people in rural areas about the idea of the fuel tax, and she                 
 suggested there were problems in collecting the landing fees.  She            
 asked if the people in rural areas approved of the solution.                  
 MS. SANDVIC explained initially there was opposition to landing               
 fees and difficult to collect, there was a feeling it was                     
 equitable.  She described the objection came from the larger                  
 carriers who felt everyone benefitted from the airport, but it was            
 felt that not everyone was contributing their fair share; whereas,            
 the tax would properly reflect usage because it wold be adjusted              
 according to the level of fuel used.                                          
 Number 196                                                                    
 SENATOR TAYLOR suggested MS. SANDVIC meant to use "gasoline use               
 fee."  He called on GARY MOORE, Planning Director for the Tanana              
 Chief's Conference, who testified OFFNET from Fairbanks.                      
 MR. MOORE asked if there was just an increase aviation tax or did             
 it include motor fuel included in water craft, which is $.05 per              
 gallon.  Is it just aviation tax?                                             
 SENATOR TAYLOR directed MR. MOORE'S attention to the bill to the              
 language in darker print as the only changes being made, and                  
 explaining the rest of the bill is existing language in law.  He              
 reiterated the only changes were to aviation fuels.                           
 MR. MOORE described the aviation fuel tax increase as impacted on             
 the villages in his region and he reviewed the Interior regions               
 which are accessible only by air or river, where any increase in              
 aviation fuel would be passed on to the customers.  In checking the           
 prices of gasoline, MR. MOORE found the current cost of gasoline in           
 that region is $2.35 per gallon; aviation fuel is $4.18 per gallon;           
 gasoline in Galena is $2.50 per gallon, and aviation fuel is $3.50            
 a gallon, and in Fort Yukon the price of gas is $2.55 and aviation            
 fuel is $2.88 per gallon.                                                     
 MR. MOORE thought it was a substantial amount of money to pay for             
 fuel in the rural areas that are more depressed than the urban                
 areas in Alaska.  He expressed concerns the tax would be passed on            
 to the rural residents, and although he understands DOT's role in             
 maintenance, he could not support the bill.                                   
 Number 240                                                                    
 SENATOR TAYLOR assured MR. MOORE this was not a price increase on             
 the existing price of gasoline, but only on the amount of the flow.           
 He gave an example of an airplane burning 20 gallons an hour,                 
 making an increase of $.14 per hour's flying time.                            
 MR. MOORE asked if there would be a corresponding increase in the             
 fares to the rural areas, and SENATOR TAYLOR explained the $.14               
 would be divided among the fares of the passengers.                           
 MS. SANDVIC responded in describing the public hearing process                
 where the air carriers testified the fuel tax was preferable, since           
 it spreads the burden out amongst more carriers than otherwise.               
 SENATOR SHARP pointed to Section 6 as a blackmail clause to prevent           
 double dipping, and SENATOR TAYLOR referred Section 6 to MR. MOORE            
 which presents the Department of Transportation from charging                 
 landing fees until January 1, 2000.  MR. MOORE said most of his               
 questions had been answered.                                                  
 SENATOR LITTLE questioned SENATOR TAYLOR'S use of "kerosine                   
 burners," and he explained they were jets, which were very                    
 Number 289                                                                    
 SENATOR LITTLE asked MS. SANDVIC for a review of the fiscal note,             
 and she quoted the revenue as $1,725.7 million and would cost                 
 approximately $20.4 thousand to administer.  SENATOR JACKO asked              
 what assurance would there be the $1,725.7 million would be spent             
 on maintenance of rural airports.                                             
 MS. SANDVIC said it would not pay for the entire cost of                      
 maintenance of the airports, and she suggested several ways of                
 dealing with the problem by dedicated funds or a constitutional               
 SENATOR DONLEY declared he was not supporting any new taxes until             
 the operating budget was under control, and he blamed the                     
 administration for not proposing reductions in the operating                  
 budget.  His only exception was alcohol and tobacco taxes.                    
 Second, SENATOR DONLEY didn't think this was a fair tax, and he               
 blamed the Department of Transportation for not following the                 
 Administrative Procedures Act for implementing the landing fees               
 regulations.  He said he was voting against the bill.                         
 SENATOR JACKO moved to pass CS FOR SENATE BILL NO. 256(TRA)                   
 (INCREASE AVIATION FUEL TAX) from committee.  SENATOR DONLEY                  
 SENATOR TAYLOR called for a vote on SENATOR JACKO's move to pass              
 committee.  The roll was taken with the following results:                    
 SENATORS TAYLOR, JACKO, and LITTLE voted "yes," and SENATOR DONLEY            
 voted "nay."  SENATOR TAYLOR stated the bill was moved from                   
 There being no further business to come before the committee, the             
 meeting was adjourned at 2:55 p.m. by SENATOR TAYLOR.                         

Document Name Date/Time Subjects