Legislature(1993 - 1994)
02/04/1993 03:45 PM Senate TRA
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SENATE TRANSPORTATION COMMITTEE
February 4, 1993
3:45 p.m.
MEMBERS PRESENT
Senator Bert Sharp, Chairman
MEMBERS ABSENT
Senator Randy Phillips, Vice Chairman
Senator Tim Kelly
Senator Jay Kerttula
Senator Georgianna Lincoln
COMMITTEE CALENDAR
SENATE JOINT RESOLUTION NO. 18
Proposing amendments to the Constitution of the State of
Alaska creating a transportation fund.
PREVIOUS SENATE COMMITTEE ACTION
SJR 18 - No previous action to record.
WITNESS REGISTER
John Watts
Board of Directors
Alaska Air Carriers Association
P.O. Box 787
Bethel, Alaska 99551
POSITION STATEMENT: Testified on SJR 18.
Kim Daniels, Executive Director
Alaska Air Carriers Association
1117 East 35th, Number 102
Anchorage, Alaska 99508
POSITION STATEMENT: Testified against SJR 18.
Frank Dillon, Executive Director
Alaska Trucking Association
3443 Minnesota Drive
Anchorage, Alaska 99503
POSITION STATEMENT: Testified in support of SJR 18.
ACTION NARRATIVE
TAPE 93-3, SIDE A
Number 001
CHAIRMAN SHARP called the Senate Transportation Committee
meeting to order at 3:45 p.m.
The only order of business was SJR 18 (CONSTITUTIONAL
AMENDMENT FOR TRANSPORTATION FUND), sponsored by the Senate
Rules Committee by request of the governor. FRANK TURPIN,
Commissioner, Department of Transportation and Public
Facilities gave a brief overview of the resolution. He
indicated that the resolution proposes a constitutional
amendment to allow revenues derived from taxes on motor
fuel, marine fuel and aviation fuel; revenue derived from
license fees for the registration and operation of motor
vehicles, aircraft and watercraft; and, revenue derived from
the use of state transportation facilities, to be placed
into a transportation fund dedicated for the maintenance and
operation of transportation facilities. The marine highway
ticket revenues will be used in the operation of the marine
system, marine fuel taxes can be used for maintenance or
construction of harbor facilities, he explained.
Commissioner Turpin indicated that there is very strong
support from many constituents. Polls have shown that up to
seventy-five percent of the people favor the resolution.
Numerous organizations have passed resolutions supporting
the proposal such as the State Chamber of Commerce, the
Alaska Trucking Association, organized labor, the Municipal
League, Southeast Conference, Southwest Conference, the
Harbor Masters, etc. There has also been editorial support
from all of the state's major newspapers. Commissioner
Turpin explained that there is some opposition from the
Alaska Air Carriers, and indicated he isn't sure what their
objection may be.
Commissioner Turpin said the change will pay for the
administrative costs of collecting vehicle registration and
operator's licensing fees. It also contains an escape
clause where the funds could be used for any purpose by a
three-fourths vote of each house. He said he would be happy
to answer any questions.
Number 024
JOHN WATTS, Board of Directors, Alaska Air Carriers
Association, said one of the biggest problems is maintaining
the accountability of the funding. If all questions by the
Alaska Air Carriers can be answered relating to
accountability, the commissioner may gain the support of the
Alaska Air Carriers as a group. Mr. Watts said he would
like to hear other questions and responses from other people
testifying on the bill.
KIM DANIELS, Executive Director, Alaska Air Carriers
Association, testified in opposition to SJR 18. She
explained her organization was founded in 1966, and
currently represents 128 commercial airline companies
operating in Alaska. In the past, the Air Carriers
Association has taken a strong position in opposition to a
dedicated fund and it is their opinion that the current
situation is no different today than before. She said that
her organization has asked that the administration to more
clearly define and justify the dedicated fund concept and
they received no response. An accounting of the existing
appropriations and a justification for approximately $7 to
$8 million appropriated for rural airport maintenance and
operations was asked for and a response was not received.
Ms. Daniels said her organization has asked for and was
promised a roll back in landing fees if the aviation fuel
tax audit money was found. The audit money was found, but
the administration has not followed through on its promise
to roll back landing fees. She said the Alaska Air Carriers
don't necessarily oppose the concept of a dedicated fund,
they cannot presently support SJR 18 or any other similar
proposal without more clearly detailed definition.
COMMISSIONER TURPIN referred to the accounting question and
said the maintenance of the airports is often done by the
same people, and in many cases by the same person who also
does highway maintenance. He discussed the situation in
Talkeetna where one man who maintains the airport and
thirty-nine miles of highways. The department isn't able to
tell him how much time should be charged to airports and
highways. It is difficult to give an exact figure of what
the maintenance of many of the airports would be.
Commissioner Turpin referred to the audit of tax funds
collected and said he believes that the Air Carriers were
concerned that a lot of taxes were not being collected from
various aviation units. DOT/PF had the Department of
Revenue performed an audit which indicated that the
collection was very accurate. He noted that in one case
about $75 thousand was returned due to an error in the
collection. Commissioner Turpin said the department has
informed the Air Carriers that they prefer an increase in
aviation gasoline as opposed to landing fees at the
certified airports. There hasn't been an increase in
aviation taxes and the department is not proposing that.
Number 085
FRANK DILLON, Executive Director, Alaska Trucking
Association, said the association has been in existence for
thirty-three years and is comprised of approximately 300
members throughout Alaska. He explained that they support
the dedicated transportation fund. The Alaska Trucking
Association discussed dedicated funding and are convinced
that it is in the best interest of Alaska. It is the
association's belief that a dedicated fund, which fairly
taxes and collects fees from different transportation modes
to be used in maintaining facilities related to those modes,
will in the long term provide the very best way to meet the
financial needs of maintenance and repair work on Alaska's
highways, airports, and port facilities. He indicated that
the association believes it is important to retain
legislative appropriation in the process.
Mr. Dillon asked several questions as to how will spending
from the fund will be prioritized. He asked who will be
eligible - which agencies and which programs. There is also
concern as to how the criteria for establishing eligibility
will be determined. Mr. Dillon noted concern that because
of Alaska's small tax base and there not being lot of
people, it may not be possible or practical to fully fund
the maintenance needs of the transportation infrastructure
through user fees and taxes. He suggested that the door be
left open so that at discretion of the legislature,
supplements to the transportation fund can be made.
COMMISSIONER TURPIN explained that most of the details of
any tax program that is associated with the fund would be
included in the bill that would provide the taxes.
Number 121
CHAIRMAN SHARP referred to page 2, line 7 and asked why it
has maintenance and operation and not construction. He also
asked why line 10 says, "improvement and construction" and
not "maintenance and operation of harbor facilities."
Commissioner Turpin explained that virtually all of Alaska's
construction money for highways now comes from the federal
government. The amount of that funding is so vast compared
to the tax receipts. The department felt that it would be a
much more desirable situation to have the maintenance money
provided by the gasoline taxes as the federal gasoline taxes
are providing construction funds. Commissioner Turpin said
the maintenance of the boat harbors can be provided by the
users of the harbors in berth fees. He said the tax monies
in marine fuels could be very effective when used in the
state for retiring bonds and constructing or renovating boat
harbors rather than just for maintenance.
Chairman Sharp asked if there are state built harbor
facilities operated by the municipalities that collect the
berthing fees and do the maintenance. Commissioner Turpin
explained that in many cases the municipalities collect the
berthing fees which are used to operate the city. Very
little is put into maintenance. He noted that is the case
of Whittier.
Chairman Sharp referred to highway and airport construction
federal matching money and asked if the state's matching
money would come out of the general fund and not the
dedicated fund. Commissioner Turpin indicated the chairman
is correct.
Chairman Sharp referred to page 2, lines 17, and 18 and
asked the commissioner to give an example of a public
corporation whose revenue must by federal law be retained
and managed by the corporation. Commissioner Turpin said
the Alaska Railroad.
Number 164
Chairman Sharp said the bill would be scheduled for action
by the committee the following week. He continued to
discuss the scheduling for the following week.
Number 183
CHAIRMAN SHARP adjourned the Senate Transportation meeting
at
4:10 p.m.
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