SENATOR RANDY PHILLIPS brought SB 191 (MUNICIPAL PROPERTY TAX LIMITATIONS) before the committee. CAROL CARROL, staff to Senator Jay Kerttula, explained the legislation would clarify law for general law municipalities that would allow them to put a tax limitation on the ballot by initiative. If an initiative had passed and there was a tax cap, then the only way that it could be removed would be by referendum. Ms. Carrol said the legislation would become effective January 1, 1994, the beginning of the new calendar year. Number 390 TAM COOK, Director, Division of Legal Services, Legislative Affairs Agency, added that from time to time, people are concerned that if there were a tax limitation, it would somehow adversely affect bonding. This particular language is drafted so that the language on bonding which now exists in the statute and provides that any limit on taxes cannot be imposed to affect payback of bonds will apply to this limit too, assuming that the voters of a particular municipality chose to impose a limit. She assured the committee that bonds would remain protected. Number 400 KEN SWISHER, Executive Director, Alaska Municipal League, voiced opposition to SB 191. Doing something by initiative creates the opportunity to reduce municipal tax authority through an action directly by the public. The League believes that it creates a vulnerability in terms of the muncipality's operating budget. The proper remedy for disputes about taxation is through the electoral process in terms of selecting people who are in office. Mr. Swisher suggested that it would be more acceptable if the bill were to be amended in such a way that the initiative was not a possibility. Number 425 SENATOR LEMAN disagreed with Mr. Swisher's comments and said he thinks having the ability to have a "taxpayer revolt" is one of the beauties of the our system. SENATOR RANDY PHILLIPS closed the public hearing on SB 191.