04/30/2024 01:30 PM Senate COMMUNITY & REGIONAL AFFAIRS

                   HB 347-PROPERTY ASSESSMENT                                                                               
                                                                                                                                
1:33:14 PM                                                                                                                    
CHAIR  DUNBAR announced  the consideration  of CS  FOR HOUSE  BILL                                                              
NO.  347(CRA)  am "An  Act  relating  to assessment  of  property,                                                              
boards  of  equalization,  and  certification  of  assessors;  and                                                              
providing for an effective date."                                                                                               
                                                                                                                                
CHAIR DUNBAR  stated this  is the introductory  hearing of  HB 347                                                              
in the  Senate Community and  Regional Affairs Committee.  SB 242,                                                              
the Senate  companion bill,  was heard in  committee on  March 12,                                                              
2024,  invited and  public testimony  were heard.  He invited  the                                                              
bill sponsor to introduce HB 347.                                                                                               
                                                                                                                                
1:33:44 PM                                                                                                                    
REPRESENTATIVE   JULIE  COULOMBE,   District   11,  Alaska   State                                                              
Legislature, Juneau,  Alaska, sponsor of HB 347, said  that HB 347                                                              
is  the  companion  legislation  to SB  242.  HB  347  establishes                                                              
fairness  in property tax  assessments by  setting guidelines  for                                                              
municipalities  while preserving  local  control.  It directs  the                                                              
Department  of Commerce,  Community, and  Economic Development  to                                                              
set  clear  assessment  standards   for  Alaskans  while  allowing                                                              
municipalities to  adopt their own to address  specific needs. She                                                              
explained that  HB 347  shifts tax appeals  to an appointed  board                                                              
of  equalization  instead  of a  local  arraigned  body,  ensuring                                                              
separation  between  policymakers   and  quasi-judicial  decision-                                                              
makers.  Many  Alaskans  may  hesitate to  speak  openly  with  an                                                              
elected  official who  could later  rule on their  appeal.  HB 347                                                              
prohibits   municipalities  from   increasing  assessed   property                                                              
values  during an  appeal, preventing  punitive  actions. It  also                                                              
requires assessors  to have the necessary  professional experience                                                              
and credentials.                                                                                                                
                                                                                                                                
1:35:43 PM                                                                                                                    
CHAIR DUNBAR  invited Ms.  Morledge to put  herself on  the record                                                              
and present the summary of changes for HB 347.                                                                                  
                                                                                                                                
1:35:49 PM                                                                                                                    
EDRA  MORLEDGE,  Staff,  Representative   Julie  Coulombe,  Alaska                                                              
State  Legislature,  Juneau,  Alaska,  presented  the  summary  of                                                              
changes for HB 347 and introduced herself.                                                                                      
                                                                                                                                
1:36:12 PM                                                                                                                    
At ease.                                                                                                                        
                                                                                                                                
1:37:15 PM                                                                                                                    
CHAIR DUNBAR reconvened the meeting.                                                                                            
                                                                                                                                
1:37:23 PM                                                                                                                    
MS. MORLEDGE continued the summary of changes for HB 347.                                                                       
                                                                                                                                
[Original punctuation provided.]                                                                                                
                                                                                                                                
                                                                                                                                
              Summary of Changes  CSHB 347(CRA)am                                                                               
                     Version 33-LS1430\S.A.                                                                                     
                           4.25.2024                                                                                            
                                                                                                                                
     "An Act relating to assessment of property, boards of                                                                      
       equalization, and certification of assessors; and                                                                        
               providing for an effective date."                                                                                
                                                                                                                                
       • Defined the full and true value of a property as                                                                       
        "the estimated  price that the  property would  bring                                                                   
        in an  open market  and under  the prevailing  market                                                                   
        conditions in a sale  between a willing seller  and a                                                                   
        willing buyer both  conversant with the  property and                                                                   
        with prevailing general price levels."                                                                                  
                                                                                                                                
1:37:46 PM                                                                                                                    
CHAIR DUNBAR asked where this change occurs in the bill.                                                                        
                                                                                                                                
1:37:54 PM                                                                                                                    
REPRESENTATIVE COULOMBE  replied it occurs on page  1, lines 10-12                                                              
[lines 7-10].                                                                                                                   
                                                                                                                                
1:38:01 PM                                                                                                                    
CHAIR DUNBAR  sought confirmation  those lines  were added  to the                                                              
bill.                                                                                                                           
                                                                                                                                
1:38:10 PM                                                                                                                    
REPRESENTATIVE   COULOMBE   replied    that   those   lines   were                                                              
accidentally  removed  in drafting  and  were  put back  into  the                                                              
bill.                                                                                                                           
                                                                                                                                
1:38:20 PM                                                                                                                    
CHAIR DUNBAR  asked if  these lines  were also  in the  version of                                                              
the Senate companion bill.                                                                                                      
                                                                                                                                
REPRESENTATIVE COULOMBE replied yes.                                                                                            
                                                                                                                                
1:38:25 PM                                                                                                                    
MS. MORLEDGE  continued the summary  of changes, stating  the next                                                              
change is in Section 3 on page 2, lines 15 -16 [lines 6-7]:                                                                     
                                                                                                                                
     • Allows for a level 3 certification or higher, rather                                                                     
        than requiring only a level 3 certification of a                                                                        
        municipal assessor.                                                                                                     
                                                                                                                                
1:38:58 PM                                                                                                                    
REPRESENTATIVE  COULOMBE   said  that  assessors  can   go  up  to                                                              
level 5. The House  did not want to restrict  the certification to                                                              
a level 3,  so it added the  words  or higher  to include  level 4                                                              
and level 5 assessor certifications.                                                                                            
                                                                                                                                
1:39:16 PM                                                                                                                    
MS. MORLEDGE  said the  next change  is on  page 2, line  18[lines                                                              
12-14]  and clarified  that  the change  amends  Section 4,  which                                                              
begins on line 10.                                                                                                              
                                                                                                                                
     • Requires the assessor to meet with a person who has                                                                      
        received an assessment notice they believe to be in                                                                     
        error to advise them of the methods used and to                                                                         
        answer questions of the property owner.                                                                                 
                                                                                                                                
1:40:30 PM                                                                                                                    
CHAIR  DUNBAR reiterated  the change,  reading  the inserted,  new                                                              
text aloud.                                                                                                                     
                                                                                                                                
1:40:42 PM                                                                                                                    
MS.  MORLEDGE continued  the  summary of  changes  with the  final                                                              
bullet point, stating  the effective date for when  a municipality                                                              
shall  engage  a certified  level  3  or  higher was  extended  to                                                              
January 1, 2026, rather than 2025.                                                                                              
                                                                                                                                
      • Extended the effective date for municipalities to                                                                       
        employ or contract with a level 3 certified assessor                                                                    
        to January 1, 2026.                                                                                                     
                                                                                                                                
1:41:13 PM                                                                                                                    
CHAIR  DUNBAR  stated  that  some   small  communities  in  Alaska                                                              
contract assessors  who may  not live in  the community.  He asked                                                              
if Section 4 allows for a remote meeting with an assessor.                                                                      
                                                                                                                                
1:41:47 PM                                                                                                                    
REPRESENTATIVE COULOMBE  replied that public  testifiers mentioned                                                              
difficulty  meeting   with  the  assessor.  She   noted  that  the                                                              
language remains  general to allow meetings in  person, online, or                                                              
by  phone. Some  public testifiers  wanted the  assessor to  visit                                                              
their  property. Section  4 does  not require  an in-person  visit                                                              
but ensures availability to speak with an assessor.                                                                             
                                                                                                                                
1:42:46 PM                                                                                                                    
CHAIR DUNBAR  stated that Anchorage  has thousands  of properties,                                                              
making  it  possible  for  a  group   to  exploit  the  system  by                                                              
organizing  hundreds  of  meeting  requests.  He  noted  that  the                                                              
assessor has a small  staff but would still be  required to attend                                                              
the meetings.  This could  create a  filibuster of the  assessor's                                                              
office.  He  asked  if this  concern  was  considered  during  the                                                              
drafting of HB 347.                                                                                                             
                                                                                                                                
1:43:25 PM                                                                                                                    
REPRESENTATIVE COULOMBE  stated that  the issue was  not discussed                                                              
because   90   percent   of   problems    are   resolved   through                                                              
conversations within  the assessor's office. She noted  that it is                                                              
standard  practice  to  attempt  resolution before  the  Board  of                                                              
Equalization   (BOE)   process.  Complaints   about   difficulties                                                              
meeting with the assessor came from smaller communities.                                                                        
                                                                                                                                
1:44:15 PM                                                                                                                    
SENATOR   GRAY-JACKSON  stated   that  in   the  Municipality   of                                                              
Anchorage,  assessments are  typically  10 percent  or more  below                                                              
market  value.   She  asked   if  the   amendment  would   require                                                              
assessments to be at market value.                                                                                              
                                                                                                                                
1:44:36 PM                                                                                                                    
REPRESENTATIVE  COULOMBE asked if  the reference  was to  line 10,                                                              
which  states,   "the  full   and  true   value  as  provided   in                                                              
standards."  She  noted  that  this   language  was  inadvertently                                                              
removed from the original bill and does not create a change.                                                                    
                                                                                                                                
1:45:29 PM                                                                                                                    
SENATOR GRAY-JACKSON  stated that  she asked the  question because                                                              
the Summary  of Changes  for HB  347 reads,  "the estimated  price                                                              
that the  property would  bring in  an open  market and  under the                                                              
prevailing  market conditions,"  goes  further  than the  language                                                              
used in statute.                                                                                                                
                                                                                                                                
1:45:56 PM                                                                                                                    
CHAIR DUNBAR directed  the question to Mr. Nelson and  asked if he                                                              
sees the  language in  Section 1  as a  change in  policy or  as a                                                              
restatement of existing state and local tax policy.                                                                             
                                                                                                                                
1:46:34 PM                                                                                                                    
DAN  NELSON,  State  Assessor,   Community  and  Regional  Affairs                                                              
Division,   Department  of   Commerce,   Community  and   Economic                                                              
Development  (DCCED), Anchorage,  Alaska, answered  he sees  it as                                                              
the same policy.                                                                                                                
                                                                                                                                
1:46:54 PM                                                                                                                    
CHAIR  DUNBAR  noted  that  although  there  is  no  fiscal  note,                                                              
municipalities  may  incur  costs  if required  to  have  Level  3                                                              
assessors.  He asked  how  much it  would  cost municipalities  to                                                              
train assessors.                                                                                                                
                                                                                                                                
1:47:23 PM                                                                                                                    
MR. NELSON  stated that he was  unfamiliar with the costs  but was                                                              
familiar  with Level  3 certification  requirements. He  described                                                              
the point system.                                                                                                               
                                                                                                                                
1:49:09 PM                                                                                                                    
SENATOR  GRAY-JACKSON  asked  how  many  assessors  hold  Level  3                                                              
certification.                                                                                                                  
                                                                                                                                
MR. NELSON  replied  that he does  not know  the qualification  of                                                              
each  assessor.  He  stated  he  would  find  out  the  number  of                                                              
assessors with Level 3 certification.                                                                                           
                                                                                                                                
1:49:54 PM                                                                                                                    
SENATOR GRAY-JACKSON thanked Mr. Nelson for his offer.                                                                          
                                                                                                                                
1:50:05 PM                                                                                                                    
CHAIR DUNBAR asked  if the sponsor has a sense of  whether Level 3                                                              
is a new level of qualification for assessors.                                                                                  
                                                                                                                                
1:50:10 PM                                                                                                                    
REPRESENTATIVE  COULOMBE  replied that  this  discussion was  well                                                              
vetted among  colleagues from small  communities. She  pointed out                                                              
that  HB 347  allows  Level  3 assessors  to  oversee  lower-level                                                              
assessors. She noted  that assessor turnover is an  issue, and the                                                              
[state] will  grant Level  3 certification  to assessors  from the                                                              
lower 48  if they have  similar qualifications. Small  communities                                                              
can contract rather  than hire a Level 3 assessor.  She added that                                                              
problems  in Haines  and  Juneau were  the  result of  uncertified                                                              
assessors.                                                                                                                      
                                                                                                                                
1:51:49 PM                                                                                                                    
CHAIR DUNBAR opened  public testimony on HB 347;  finding none, he                                                              
closed public testimony.                                                                                                        
                                                                                                                                
CHAIR DUNBAR held HB 347 in committee.