Legislature(2017 - 2018)CAPITOL 106
03/27/2017 08:00 AM House EDUCATION
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| HB102 | |
| HB52 | |
| HB146 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 102 | TELECONFERENCED | |
| += | HB 52 | TELECONFERENCED | |
| += | HB 146 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 146-SCHOOL TAX; PFD PAYMENT FOR SCHOOL TAX
8:38:58 AM
CHAIR DRUMMOND announced that the final order of business would
be SPONSOR SUBSTITUTE FOR HOUSE BILL NO. 146, "An Act imposing a
school tax on certain income of residents, part-year residents,
and nonresidents; relating to a payment against the school tax
from the permanent fund dividend disbursement; and providing for
an effective date."
8:39:23 AM
CHAIR DRUMMOND opened public testimony.
8:39:39 AM
ALLEN MCCARTY, Spokesperson, Citizens Alliance Protecting School
Lands, informed the committee Citizens Alliance Protecting
School Lands is a statewide organization formed to protect
school lands and school funds. He said the proposed bill would
attack the 5 percent per year trust fund. Mr. McCarty expressed
his understanding that the school fund is a trust, and is not
state money, but is school money. Each year the earnings from
the trust are deposited into the general fund. The earnings
have reduced from $24 million per year to $10 million per year
due to poor investments by the Department of Revenue (DOR). He
cautioned that at the end of the bill the language of the bill
would attack the trust fund and in 26 years the fund that has
been building since 1915 will be totally gone.
8:41:51 AM
OWEN PHILLIPS, Staff, Representative Matt Claman, Alaska State
Legislature, said he is unware of a 5 percent decrease [in the
school fund]. He further clarified that the bill would garner
approximately $500 million through taxes that would be
designated to "the school fund and then, as I understand it, the
leftover would just stay in undesignated funds and be allocated
elsewhere."
CHAIR DRUMMOND asked whether the school tax funds would be
"somehow distinguished."
MR. PHILLIPS said DOR would have authority to adopt regulations
for management of the funds.
8:43:39 AM
CHAIR DRUMMOND, after ascertaining no one further wished to
testify, closed public testimony. She remarked:
This bill, SSHB 146, has a lot of working parts. I
believe that with our current fiscal reality, we need
to keep our options open. I feel there are some
things in this bill that need to be clarified, but I
think I want to let [the House Finance Committee] do
that. I don't want to hold this bill up here, so we
can give them time to fully vet this bill in that
committee. ... I know I would like to see a more
progressive tax scale, but I am not sure how that
would look. I'm not sure how I feel about taxing
children who only receive a PFD as income, even though
they would benefit from this tax. But those issues,
to me, are less about education policy and more about
finance, so I would like to move this bill out today
with the understanding that in its current form, I
would not necessarily vote for this bill on the House
floor.
REPRESENTATIVE PARISH opined the bill levies a tax on every
Alaskan and urged for a mechanism to draw revenue from
nonresidents and working adults earning income from other
sources. He agreed the education committee is not the best
committee to address the [financial aspects] of the bill.
REPRESENTATIVE TALERICO directed attention to the bill on page
2, lines 4-13, which read:
(b) For a taxpayer whose adjusted gross income is
(1) less than $20,000, the tax is $100 a year;
(2) $20,000 or more, but less than $40,000, the
tax is $250 a year;
(3) $40,000 or more, but less than $50,000, the
tax is $500 a year;
(4) $50,000 or more, but less than $75,000, the
tax is $750 a year;
(5) $75,000 or more, but less than $100,000,
the tax is $1,000 a year;
(6) $100,000 or more, but less than $150,000,
the tax is $2,500 a year;
(7) $150,000 or more, but less than $200,000,
the tax is $5,000 a year;
(8) $200,000 or more, but less than $250,000,
the tax is $6,500 a year;
(9) $250,000 or more, the tax is $8,500 a year.
REPRESENTATIVE TALERICO related the rates for adjusted gross
income are much higher than the previous school tax; also,
aspects of the maximum income limit, the steps between income
limits, and part-time income are questionable. He pointed out
the bill assesses a tax on year-around Alaska residents who live
below the poverty level. Representative Talerico said he could
not support the bill.
8:48:21 AM
REPRESENTATIVE SPOHNHOLZ stated support for the overall intent
of the bill, which is to find a way to fund public education
based on one's income. She said progressivity in a revenue plan
is appropriate at both ends of the income scale, however, she
expressed her concerns about the structure of the bill and its
disproportionate impact on lower-income taxpayers, with maximum
tax [relief for] higher-income taxpayers. Representative
Spohnholz said she would reluctantly support moving the bill
from committee.
8:51:27 AM
REPRESENTATIVE PARISH moved to report SSHB 146 out of committee
with individual recommendations and the accompanying fiscal
notes.
REPRESENTATIVE TALERICO objected.
8:51:47 AM
A roll call vote was taken. Representatives Parish, Fansler,
Spohnholz, and Drummond voted in favor of SSHB 146.
Representatives Kopp and Talerico voted against it. Therefore,
SSHB 146 was reported out of the House Education Standing
Committee by a vote of 4-2.
| Document Name | Date/Time | Subjects |
|---|