1993-01-15                     House Journal                      Page 0084
HB 66                                                                        
HOUSE BILL NO. 66 by the House Rules Committee by request of                   
the Governor, entitled:                                                        
                                                                               
"An Act relating to municipal property tax exemptions for certain             
residences and to property tax equivalency payments for certain                
residents; and providing for an effective date."                               
                                                                               
was read the first time and referred to the Community & Regional               
Affairs, Health, Education & Social Services and Finance Committees.           
                                                                               
The following fiscal notes apply:                                              
                                                                               
Zero fiscal notes (2), Dept. of Community & Regional Affairs,                 
1/15/93                                                                      
Zero fiscal note, Dept. of Administration, 1/15/93                            
                                                                               
The Governor's transmittal letter, dated January 15, 1993, appears             
below:                                                                         
                                                                               

1993-01-15                     House Journal                      Page 0085
HB 66                                                                        
"Dear Speaker Barnes:                                                          
                                                                               
Under the authority of art. III, sec. 18, of the Alaska Constitution, I am     
transmitting a bill relating to the mandatory and optional property tax        
exemptions for residences of senior citizens, disabled veterans and their      
widow or widowers, and to property tax equivalency payments for                
certain residents.                                                             
                                                                               
                                                                               
The bill provides for municipalities to offer tax exemptions to these          
people and repeals the mandatory property tax exemption.  The bill             
also repeals the provision for state reimbursement to municipalities for       
property tax revenue lost to the municipality by operation of the              
mandatory tax exemptions.  Also, the bill repeals the provision for a          
property tax equivalency payment from the state to persons who rent            
a residence but would otherwise qualify for a mandatory tax exemption          
(the "renter's rebate" program).  Finally, the bill has a retroactive          
effective date to January 1, 1993.                                             
                                                                               
                                                                               
Due to declining state revenue, it has become apparent over the past           
several years that the state can no longer afford to fully pay for the         
municipal reimbursement program for the mandatory senior citizen or            
disabled veteran property tax exemptions.  As a result, municipalities         
have not been reimbursed in full for the tax revenue lost due to the           
mandatory property tax exemptions.  This bill will allow municipalities        
to decide whether they wish to exempt such property from taxation in           
whole or in part.  If they choose to exempt the property, they will, of        
course, lose tax revenue, but that decision will be up to the individual       
municipality and will not be mandated by the state.                            
                                                                               
                                                                               
Also, again due to declining state revenue, the state has not fully            
funded the "renter's rebate" program during the past several years.  It        
is appropriate that this program be repealed at the same time as the           
mandatory property tax exemption provision in order to ensure that, for        
property tax purposes, the state is treating seniors and disabled veterans     
who rent a residence in a manner similar to seniors and disabled               
veterans who own a residence.                                                  
                                                                               
                                                                               

1993-01-15                     House Journal                      Page 0086
HB 66                                                                        
I urge your prompt consideration and passage of this bill.                     
                                                                               
           Sincerely,                                                          
           /s/                                                                 
           Walter J. Hickel                                                    
           Governor"