Legislature(1993 - 1994)
04/21/1993 09:05 AM Senate FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
CS FOR HOUSE BILL NO. 66(FIN) am
An Act relating to an exemption from and deferral of
municipal property taxes for certain primary
residences, to property tax equivalency payments for
certain residents, to the determination of full and
true value of taxable property in a municipality; and
providing for an effective date.
Co-chair Pearce directed that CSHB 66 (Fin)am be brought on
for discussion and referenced a new draft SCS CSHB 66 (Fin)
(8-GH1032\M, Cook, 4/20/93), two new fiscal notes from the
Dept. of Community and Regional Affairs, and an April 20,
1993, memorandum from Tam Cook regarding the optional tax
exemption.
RICK SOLIE, aide to Co-chair Frank, came before committee.
He advised of need for a technical amendment. Co-chair
Frank MOVED for adoption of the "M" version of SCS CSHB 66
(Fin). He explained that the draft contains provisions for
municipalities to opt out of the senior citizens' portion of
the tax exemption but not from the exemption for veterans.
Senator Rieger voiced his understanding that the draft would
prohibit a municipality from opting out of an exemption for
disabled veterans. He then requested clarification of
language at Sec. 5. Rick Solie advised that changes within
Sec. 5 allow a municipality to increase the exempted amount
for disabled veterans.
Senator Kelly suggested that reference to the municipal
option should be included within title language. He then
MOVED to amend the title as follows:
Page 1, line 1:
Following the word "to" add: "a municipal option for"
He said that the thrust of the Senate Finance version is the
option, and it should be so stated in the title. No
objection having been raised, the title amendment was
ADOPTED.
CAROLYN BERG came before committee representing "most of the
pioneers in Alaska." She stressed that the state has an
important and legitimate interest in preserving and
protecting the health of its senior citizens. That cannot
be done when the existing senior citizen property tax
exemption is posed for cut off at a time when health care
costs are the greatest. Senator Kelly attested to Mrs.
Berg's many years of involvement in issues before the
legislature. Senator Kerttula concurred in need for the
state to take the leadership on behalf of senior citizens.
Narrow-tax-based local communities often cannot provide much
support. Much of available local resources are devoted to
schools. Seniors are a contributing influence by virtue of
expenditure of their income. It would be an "incorrect
posture for the state not to give direction to local
governments to continue a senior citizen discount program."
He termed the proposed legislation "a bad bill."
KEN SWISHER, Alaska Municipal League, next came before
committee. He voiced a preference for the House version of
the legislation over the newly adopted SCS CSHB 66(Fin).
The House legislation allowed maximum flexibility to local
governments to structure programs most fitting the local
level. The preferred option is for full funding of the
exemptions. Support for CSHB 66 (Fin)am is the second
choice.
The Municipal League surveyed local officials to determine
what action might be taken should the legislation pass.
Most agree that the matter will become an issue at the local
level, and some form of action will be taken. The survey
covered Anchorage, Kenai, Juneau, MatSu, Cordova, and
Valdez. Referencing the disabled veterans mandate, Mr.
Swisher expressed a preference for municipalities to be able
to consider need. The needy should be helped rather than
those who do not require assistance. Assistance to those
who are not needy comes at the expense of those who do.
Preserving seniors in their homes is of great value. The
league supports that effort. On the other hand, a number of
young families have difficulty keeping their children fed
and clothed. Senator Kerttula spoke to tax payments by
seniors over many years. He reiterated that most of the
support at the local level goes to schools. Taxpayers
continue to support schools long after their children have
graduated. Mandating the continued exemption should not
adversely impact boroughs. Senator Kerttula took exception
to the position taken by the league, terming it
"intolerable."
BRUCE GERAGHTY, Deputy Commissioner, Dept. of Community and
Regional Affairs, next came before committee. He initially
spoke to problems surrounding lack of a disability threshold
for the disabled veteran exemption and suggested that the
committee include language relating to 50% disability. At
the present time there are 703 disabled veterans who would
qualify for the program. Of that number, 421 are in
Anchorage.
Mr. Geraghty expressed the department preference for an
earlier work draft of the bill, distributed for review at a
prior meeting. That version allows municipalities the
greatest flexibility and maintains programs unless
municipalities take action to alter them.
Discussion followed between Mr. Geraghty and committee
members regarding inclusion of the 50% disability threshold
in the earlier version and lack thereof in adopted version
"M." Rick Solie clarified the issue by explaining that the
since the "M" version does not amend "any aspect of the
disabled veterans' program" there was no need for the
definition. Mr. Geraghty said the department would have no
problem with the bill if the definition remains in law. Mr.
Solie concurred that it remains in existing statutes.
Senator Kerttula noted that a 10% disability in youth may
comprise a much larger percentage as one grows older. He
then asked if statutes contain a method of reevaluating
injuries. Mr. Geraghty said that the department does not
determine disability. It is identified at the time of
discharge from the military. If an adjustment needs to be
made, the issue would be dealt with by the Dept. of Military
and Veterans' Affairs. Co-chair Pearce asked that Mr.
Geraghty research the matter and provides members
information on available avenues.
Co-chair Pearce called for additional questions or comments
on the bill. Senator Kerttula MOVED to TABLE the bill. Co-
chair Frank OBJECTED. Co-chair Pearce called for a show of
hands. The motion FAILED on a vote of 1 to 5.
Co-chair Frank MOVED for passage of SCS CSHB 66 (Fin) with
individual recommendations and the appropriate fiscal notes.
Senator Kerttula OBJECTED. Co-chair Pearce called for a
show of hands. The motion CARRIED on a vote of 5 to 1, and
SCS CSHB 66 (Fin) was REPORTED OUT of committee with the
following fiscal notes:
DOA 0
DOE 0
DC&RA (homeowner exemption, seniors) 0
DC&RA (renter rebate, seniors) 0
DC&RA (homeowner exemption, veterans) $1,109,520
DC&RA (renter rebate, veterans) $ 162,294
Co-chairs Pearce and Frank and Senators Rieger and Sharp
signed the committee report with a "do pass" recommendation.
Senator Kelly signed "do pass as amended." Senator Kerttula
signed "do not pass." (Senator Jacko was absent from the
meeting and did not sign.)
RECESS
Co-chair Pearce directed that the meeting be recessed at
this time, and scheduled to reconvene later in the day for
continued hearing and action on SB 7, SB 88, and SB 150.
The meeting was recessed at approximately 11:00 a.m.
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