00 CS FOR SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 397(FIN) 01 "An Act relating to the fisheries resource landing tax and to the seafood 02 marketing assessment; and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04 * Section 1. LEGISLATIVE FINDINGS, INTENT, AND PURPOSE. (a) The legislature 05 finds that 06 (1) the state has various research, management, and enforcement 07 responsibilities in connection with the offshore fisheries; 08 (2) through transfer of processed products, taking on and disembarking crew, 09 taking on fuel and supplies, obtaining vessel and gear repairs, discharging wastes, and seeking 10 protection in sheltered water, the exclusive economic zone catcher-processor fleet has a 11 significant presence in the state; and 12 (3) the state and its municipalities and unincorporated communities are affected 13 by the additional burdens placed by the exclusive economic zone catcher-processor fleet on 14 educational facilities and services, road maintenance, public safety, airport and dock facilities, 01 hospitals and health facilities, and other programs. 02 (b) The fisheries resource landing tax 03 (1) is both designed as and intended to be a compensatory tax that 04 complements the fisheries business tax levied and collected under AS 43.75; 05 (2) is intended 06 (A) to compensate the state for the burdens that the exclusive economic 07 zone catcher-processor fleet places on the state and its municipalities and 08 unincorporated communities; and 09 (B) to require the exclusive economic zone catcher-processor fleet to 10 bear a portion of the costs of services received from the state and its municipalities and 11 unincorporated communities; and 12 (3) attempts to achieve a rough equality of treatment between local and 13 interstate commerce among those engaged in fisheries resource businesses in the state in that 14 the tax imposes a burden, comparable to that borne by in-state processors through payment 15 of the fisheries business tax, for the burdens attributable to the activities of the exclusive 16 economic zone catcher-processor fleet on the state and the benefits that the fleet receives from 17 the state. 18 * Sec. 2. AS 16.51.120(a) is amended to read: 19 (a) A seafood marketing assessment shall be levied on the value of seafood 20 products produced [PURCHASED] in Alaska as provided in (b), (c), (d), or (e) of this 21 section if an election is held under [IN ACCORDANCE WITH] AS 16.51.140 at 22 which the assessment is approved by eligible processors who together produce 23 [PURCHASE] at least 51 percent of the value of seafood products produced 24 [PURCHASED] in Alaska in the calendar year. 25 * Sec. 3. AS 16.51.120(b) is amended to read: 26 (b) Each processor [WHO PURCHASES AT LEAST $50,000 OR MORE OF 27 SEAFOOD PRODUCTS IN ALASKA] shall pay a seafood marketing assessment of 28 .1 percent of the value of seafood products produced in Alaska [PAID] by the 29 processor. 30 * Sec. 4. AS 16.51.120(c) is amended to read: 31 (c) Each processor [WHO PURCHASES AT LEAST $50,000 OR MORE OF 01 SEAFOOD PRODUCTS IN ALASKA] shall pay a seafood marketing assessment of 02 .2 percent of the value of seafood products produced in Alaska [PAID] by the 03 processor. 04 * Sec. 5. AS 16.51.120(d) is amended to read: 05 (d) Each processor [WHO PURCHASES AT LEAST $50,000 OR MORE OF 06 SEAFOOD PRODUCTS IN ALASKA] shall pay a seafood marketing assessment of 07 .3 percent of the value of seafood products produced in Alaska [PAID] by the 08 processor. 09 * Sec. 6. AS 16.51.120(e) is amended to read: 10 (e) Each processor [WHO PURCHASES AT LEAST $50,000 OR MORE OF 11 SEAFOOD PRODUCTS IN ALASKA] shall pay a seafood marketing assessment of 12 .4 percent of the value of seafood products produced in Alaska [PAID] by the 13 processor. 14 * Sec. 7. AS 16.51.120 is amended by adding a new subsection to read: 15 (g) Notwithstanding (a) - (e) of this section and AS 16.51.150(c), a processor 16 is not subject to, or liable for payment of, an assessment under this section on the 17 value of the seafood products produced in Alaska if the value of seafood products 18 produced in Alaska by the processor is less than $50,000 in a calendar year. This 19 subsection does not exempt a processor from liability for payment of taxes imposed 20 under AS 43.75 or AS 43.77. 21 * Sec. 8. AS 16.51.130(a) is amended to read: 22 (a) A seafood marketing assessment levied under AS 16.51.120(b), (c), (d), or 23 (e) shall be terminated by the commissioner of revenue if 24 (1) an election is held under [IN ACCORDANCE WITH] 25 AS 16.51.140 in which the termination is approved by eligible processors who together 26 produce [PURCHASE] at least 51 percent of the total value of seafood products 27 produced [PURCHASED] in Alaska during the calendar year; or 28 (2) the board, at a regularly scheduled meeting, adopts a resolution 29 approved by two-thirds of the voting membership of the board requesting the 30 commissioner of revenue to terminate the assessment. 31 * Sec. 9. AS 16.51.130(b) is amended to read: 01 (b) An election under (a)(1) of this section shall be held if 02 (1) the proposed election for the termination of the assessment is 03 approved by a majority of the whole membership of the board at a regularly scheduled 04 meeting; or 05 (2) a petition is presented to the director of elections requesting 06 termination of the assessment by eligible processors who together produce 07 [PURCHASE] at least 25 percent of the total value of seafood products produced 08 [PURCHASED] in Alaska during the calendar year. 09 * Sec. 10. AS 16.51.150 is amended to read: 10 Sec. 16.51.150. DETERMINATION OF VALUE. Upon request from the 11 director of elections, the commissioner of revenue shall determine 12 (1) the total value of seafood products produced [PURCHASED] in 13 Alaska during any calendar year; 14 (2) whether the eligible processors approving the levy or termination 15 of a seafood marketing assessment together produced [PURCHASED] at least 51 16 percent of the total value of seafood products produced [PURCHASED] in Alaska 17 during the calendar year; or 18 (3) whether the eligible processors petitioning for an election under 19 AS 16.51.130(b)(2) together produced [PURCHASED] at least 25 percent of the total 20 value of seafood products produced [PURCHASED] in Alaska during the calendar 21 year. 22 * Sec. 11. AS 16.51.150 is amended by adding new subsections to read: 23 (b) The total value of seafood products produced in Alaska in a calendar year 24 is the sum of the 25 (1) total value of the fisheries resource on which the tax imposed under 26 AS 43.75.015 and 43.75.100 is levied in that calendar year; and 27 (2) total value of the fisheries resource on which the tax imposed under 28 AS 43.77 is levied in that calendar year. 29 (c) The value of seafood products produced in Alaska by a processor during 30 a calendar year is the sum of the 31 (1) total value of the fisheries resource on which the processor must 01 pay the tax imposed under AS 43.75.015 and 43.75.100 in that calendar year; and 02 (2) total value of the fisheries resource on which the processor must 03 pay the tax imposed under AS 43.77.010 in that calendar year. 04 * Sec. 12. AS 16.51.160(a) is amended to read: 05 (a) Each processor [PROCESSORS] shall remit to the Department of Revenue 06 before [BY] April 1 of each year the total amount of the seafood marketing 07 assessment owed on the value of [PAID FOR] seafood products produced in Alaska 08 by the processor in the previous calendar year. 09 * Sec. 13. AS 16.51.180(3) is repealed and reenacted to read: 10 (3) "processor" means a person who is liable for 11 (A) the tax imposed under AS 43.75.015; 12 (B) the tax imposed under AS 43.75.100; or 13 (C) the landing tax imposed under AS 43.77. 14 * Sec. 14. AS 16.51.180 is amended by adding new paragraphs to read: 15 (7) "eligible processor" means a processor who would be liable for 16 payment of a seafood marketing assessment levied under AS 16.51.120; 17 (8) "produce" means perform an activity upon which a tax is imposed 18 under AS 43.75 or AS 43.77, including the purchase, production, landing, or export 19 of a fisheries resource. 20 * Sec. 15. AS 21.89.070(c) is amended to read: 21 (c) A contribution claimed as a credit under this section may not 22 (1) [MAY NOT] be claimed as a credit under more than one provision 23 of this title; and 24 (2) [MAY NOT,] when combined with credits taken during the 25 taxpayer's tax year under AS 43.20.014, AS 43.55.019, AS 43.56.018, AS 43.65.018, 26 [OR] AS 43.75.018, or AS 43.77.045, exceed $150,000. 27 * Sec. 16. AS 43.20.014(d) is amended to read: 28 (d) A contribution claimed as a credit under this section may not 29 (1) [MAY NOT] be claimed as a credit under another provision of this 30 title; 31 (2) [MAY NOT] also be allowed as a deduction under 26 U.S.C. 170 01 against the tax imposed by this chapter; and 02 (3) [MAY NOT,] when combined with credits taken during the 03 taxpayer's tax year under AS 21.89.070, AS 43.55.019, AS 43.56.018, AS 43.65.018, 04 [OR] AS 43.75.018, or AS 43.77.045, exceed $150,000. 05 * Sec. 17. AS 43.55.019(d) is amended to read: 06 (d) A contribution claimed as a credit under this section may not 07 (1) be claimed as a credit under another provision of this title; and 08 (2) when combined with credits taken during the taxpayer's tax year 09 under AS 21.89.070, AS 43.20.014, AS 43.56.018, AS 43.65.018, [OR] AS 43.75.018, 10 or AS 43.77.045, exceed $150,000. 11 * Sec. 18. AS 43.56.018(d) is amended to read: 12 (d) A contribution claimed as a credit under this section may not 13 (1) be claimed as a credit under another provision of this title; and 14 (2) when combined with credits taken during the taxpayer's tax year 15 under AS 21.89.070, AS 43.20.014, AS 43.55.019, AS 43.65.018, [OR] AS 43.75.018, 16 or AS 43.77.045, exceed $150,000. 17 * Sec. 19. AS 43.65.018(d) is amended to read: 18 (d) A contribution claimed as a credit under this section may not 19 (1) be claimed as a credit under another provision of this title; and 20 (2) when combined with credits taken during the taxpayer's tax year 21 under AS 21.89.070, AS 43.20.014, AS 43.55.019, AS 43.56.018, [OR] AS 43.75.018, 22 or AS 43.77.045, exceed $150,000. 23 * Sec. 20. AS 43.75.018(d) is amended to read: 24 (d) A contribution claimed as a credit under this section may not 25 (1) be claimed as a credit under another provision of this title; and 26 (2) when combined with credits taken during the taxpayer's tax year 27 under AS 21.89.070, AS 43.20.014, AS 43.55.019, AS 43.56.018, [OR] AS 43.65.018, 28 or AS 43.77.045, exceed $150,000. 29 * Sec. 21. AS 43.77.010 is amended to read: 30 Sec. 43.77.010. LANDING TAX. A person who engages or attempts to 31 engage in a floating fisheries business in the state and who owns [A PERSON 01 OWNING] a fishery resource that is not subject to AS 43.75 but that is brought into 02 the jurisdiction of, and first landed in, this state is liable for and shall pay a landing 03 tax on the value of the fishery resource. The amount of the landing tax is 04 (1) for a developing commercial fish species, as defined under 05 AS 43.75.290, one percent of the value of the fishery resource at the place of 06 landing; 07 (2) for a fish species other than a developing commercial fish 08 species, three [3.3] percent of the value of the fishery resource at the place of the 09 landing. 10 * Sec. 22. AS 43.77 is amended by adding a new section to read: 11 Sec. 43.77.035. TAX CREDIT FOR SCHOLARSHIP CONTRIBUTIONS. (a) 12 A fisheries business is entitled to a credit of not more than five percent of the landing 13 tax liability under AS 43.77.010 for contributions made during the tax year to the A. 14 W. "Winn" Brindle memorial scholarship account under AS 14.43.250. A tax credit 15 under this section may not be approved for more than 100 percent of a scholarship 16 contribution. 17 (b) The department may not approve a tax credit under this section if the 18 fisheries business claiming the credit is in arrears in the payment of the landing tax 19 under AS 43.77.010. For purposes of this subsection, a taxpayer is not in arrears if 20 the payment is under administrative or judicial appeal. 21 (c) The department shall prepare an application form for a credit under this 22 section. 23 (d) The department shall approve or disapprove an application for a credit 24 under this section not later than 60 days after receiving the application. 25 * Sec. 23. AS 43.77 is amended by adding a new section to read: 26 Sec. 43.77.045. FISHERIES RESOURCE LANDING TAX EDUCATION 27 CREDIT. (a) In addition to the credit allowed under AS 43.77.040, for cash 28 contributions accepted for direct instruction, research, and educational support 29 purposes, including library and museum acquisitions and contributions to endowment, 30 by an Alaska university foundation or by a nonprofit, public or private, Alaska two- 31 year or four-year college accredited by a regional accreditation association, a person engaged 01 in a floating fisheries business is allowed as a credit against the tax due under this chapter 02 (1) 50 percent of contributions of not more than $100,000; and 03 (2) 100 percent of the next $100,000 of contributions. 04 (b) Each public college and university shall include in its annual operating 05 budget request contributions received and how the contributions were used. 06 (c) A contribution claimed as a credit under this section may not 07 (1) be claimed as a credit under another provision of this title; and 08 (2) when combined with credits taken during the taxpayer's tax year 09 under AS 21.89.070, AS 43.20.014, AS 43.55.019, AS 43.56.018, AS 43.65.018, or 10 AS 43.75.018, exceed $150,000. 11 * Sec. 24. AS 43.77.050(b) is amended to read: 12 (b) The [AFTER PAYMENT OF THE AMOUNT DETERMINED UNDER 13 (a) OF THIS SECTION, THE BALANCE OF THE] tax collected under this chapter 14 shall be paid into a separate account in the general fund. The annual balance in the 15 account may be appropriated by the legislature for revenue sharing under 16 AS 43.77.060. The amount of all tax credits approved by the commissioner under 17 AS 43.77.040(b) shall be deducted from amounts paid to municipalities under 18 AS 43.77.060(a) - (c). 19 * Sec. 25. AS 43.77.060 is amended by adding a new subsection to read: 20 (e) For purposes of this section, tax revenue collected under AS 43.77.010 21 from a person entitled to a credit under AS 43.77.035 or 43.77.045 shall be calculated 22 as if the person's tax had been collected without applying the credits. 23 * Sec. 26. AS 43.77.200 is amended by adding a new paragraph to read: 24 (7) "engages or attempts to engage in a floating fishery business in the 25 state" means conducting in the state an activity as part of an integrated mobile business 26 involving the harvesting or taking, processing, transportation, or delivery of a fishery 27 resource, including transfer of fishery resources or processed products, taking on and 28 disembarking crew, taking on fuel or supplies, obtaining vessel or gear repairs, 29 discharging wastes, seeking protection in sheltered waters, and any other related 30 activity that makes a claim on the resources of the state. 31 * Sec. 27. CREDIT FOR TAXES PAID. The Department of Revenue shall apply the 01 amount of tax paid by a person under AS 43.77, before the effective date of this Act, that is 02 equal to three-tenths of one percent of the value of the fishery resource subject to the landing 03 tax under AS 43.77 as a credit toward the seafood marketing assessment under AS 16.51, as 04 amended by this Act, that is retroactively imposed by this Act upon a person subject to the 05 landing tax under AS 43.77, as amended by this Act. 06 * Sec. 28. AS 16.51.180(6) and AS 43.77.050(a) are repealed. 07 * Sec. 29. This Act is retroactive to January 1, 1994, and applies to activities subject to 08 the fisheries resource landing tax levied and collected under AS 43.77 occurring after 09 December 31, 1993, and to the seafood marketing assessment assessed and collected under 10 AS 16.51. 11 * Sec. 30. This Act takes effect immediately under AS 01.10.070(c).