Legislature(2021 - 2022)ADAMS 519
04/20/2022 09:00 AM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB71 | |
| HB21 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 71 | TELECONFERENCED | |
| + | HB 21 | TELECONFERENCED | |
| + | TELECONFERENCED |
CS FOR SENATE BILL NO. 71(FIN)
"An Act relating to special request registration
plates celebrating the arts; relating to artwork in
public buildings and facilities; relating to the
management of artwork under the art in public places
fund; relating to the powers and duties of the Alaska
State Council on the Arts; establishing the Alaska
arts and cultural investment fund; and providing for
an effective date."
9:05:15 AM
SENATOR GARY STEVENS, SPONSOR, thanked members for hearing
the bill. The bill was related to the Alaska State Council
on The Arts (ASCA) and the council had requested the
legislation. It was a result of complications that had
occurred during the council's budget cycle in 2019. The
legislation would provide some needed stability to the
council and make it less reliant on unrestricted general
funds (UGF).
9:07:14 AM
BEN BROWN, CHAIR, ALASKA STATE COUNCIL ON THE ARTS, thanked
Senator Stevens for introducing the legislation. He
detailed the purpose of the bill and explained that it was
not simply about state license plates. Prior to holding the
first contest to design an Alaska license plate, the
council ensured that the winning plate would become one of
the three default plates available in the state, meaning
that it could be chosen by drivers at no additional cost.
The license plate program had been a tremendous success and
had become a popular option at the Division of Motor
Vehicles (DMV). He thought that the license plates were so
popular because Alaskans were unified in their love for the
state's natural beauty. The council thought the popularity
of the plates presented an opportunity to generate revenue
with the program. The bill would implement a modest
surcharge at a maximum of $50, though the charge would
likely be much lower than the maximum. The goal was to
charge just the right amount in order to reduce the
council's reliance on UGF. In order to receive the
allocation as a state arts agency from the National
Endowment for the Arts (NEA), the council had to match
dollar-for-dollar about a $700,000 grant that came to the
council every year as part of a three-year partnership
agreement. It was possible for the program to generate
between $50,000 and $100,000. He relayed that it seemed
that the governor and the Department of Administration were
amenable to the bill. He was happy to discuss the vetting
of the bill that took place in the House State Affairs
Committee, which was the previous committee of referral.
9:10:18 AM
Representative Wool wondered if the artistic plates would
move in statute from the category of plates that could be
selected at the DMV that came at no additional cost to the
category of plates with an additional fee.
Mr. Brown replied that the artistic plate would not be
moved to another category in statute. He explained that the
artistic plate would remain one of the three default
plates. He relayed that the council was the only state
agency with its own plate. The bill would simply allow for
a surcharge of the artistic plate that would generate
additional revenue. He indicated that Representative
Jonathan Kreiss-Tompkins was involved in the original
legislation for the artistic plate program and was
insistent that the mechanism of the program stayed the
same. He emphasized that the process would remain the same
apart from the modest surcharge.
Co-Chair Merrick indicated Representative Johnson had
joined the meeting.
Representative Wool understood that if a person wanted an
artistic plate, there would be a surcharge that would
benefit ASCA. Other plates that were not part of the
default three also had surcharges, but the money would not
go to a state agency.
Mr. Brown responded that he was correct.
9:13:02 AM
Co-Chair Foster asked if people who already had artistic
plates would be grandfathered in and therefore not required
to pay the surcharge.
Mr. Brown responded that the charge would only apply when
an individual received the physical plate. There would be
no additional fee associated with car registration renewal
stickers for individuals who already had artistic plates.
Only upon receiving a new plate associated with the
upcoming license plate design contest would the fee begin
to apply.
Co-Chair Foster asked whether the surcharge would be in
addition to the fees already in place.
Mr. Brown responded in the affirmative. The council was
envisioning a charge in the $3 range. A person would not be
paying $50 or $100 as they would with some of the other
specialty plates.
Representative LeBon suggested that people would only pay
the surcharge once.
Mr. Brown responded that he was correct.
9:14:47 AM
Representative Johnson thought that the surcharge fee
should be consistent.
Mr. Brown responded that the bill was set up with input
from DMV. The program would be easy to implement
administratively as it would change the current system as
little as possible. He spoke of the robust interest there
had been in the design contest in the past. Over 15,000
people voted to select the currently offered artistic
plate.
Co-Chair Merrick indicated Representative Rasmussen and
Representative Carpenter had joined the meeting.
Representative Wool asked whether the $3 fee was the goal
of the bill. He thought it seemed low and wondered if it
would be enough to generate the revenue the council
desired. He asked where the revenue would be applied.
Mr. Brown thought people would pay more for luxury goods,
but license plates were not a luxury item. There would be a
public process in which the council would receive feedback
on whether the $3 fee seemed reasonable. If the public
thought the fee should be higher, it might be revised.
9:17:52 AM
TIM LAMKIN, STAFF, SENATOR GARY STEVENS, noted that
committee packets included a helpful document: "DMV License
Plates Total by Calendar year" (copy on file). He explained
that it behooved the council to not make the surcharge too
high. The maximum fee was set at $50 in the bill simply to
allow for flexibility, but it was unlikely that it would
reach that amount.
Co-Chair Merrick indicated that her notes reflected that
three members recommended amending the bill. She asked what
the suggestions were.
Mr. Brown relayed that there was some discussion about
other sections of the bill unrelated to license plates.
There were some questions about legal counsel and ensuring
that it was clear that the Attorney General would serve as
legal counsel for ASCA. There were also questions about the
Arts and Culture Investment Fund in Section 6 of the bill.
He assumed that this section was the target of the
amendments but disagreed with amending the section. There
had been significant collaborative work to ensure that the
bill would not create a dedicated fund but a designated
fund. He elaborated that the $700,000 that ASCA received as
part of the agreement with NEA was only 45 percent of the
council's budget. The remaining 55 percent came from the
Rasmuson Foundation and other state partners. The council
was the only state agency leveraging non-governmental money
to accomplish its work. He thought it was important to
identify that the council was bringing in private funds.
Co-Chair Merrick agreed that Section 6 might have been
controversial.
9:21:30 AM
Co-Chair Foster asked if the fund was sweep-able.
Mr. Brown understood that it was not.
Mr. Lamkin confirmed that the issue came up in the State
Affairs Committee and representatives from the Department
of Law and the Legislative Division reported that it was
not sweep-able.
9:22:25 AM
Co-Chair Foster asked what the vision was around
capitalizing the fund. He wondered whether the state would
capitalize the fund or if it would be a combination of
state and private capitalizations.
Mr. Brown responded that the fund consisted of money
appropriated by the legislature, donation funds, and other
sources. It was a combination of state, federal, and
private contributions.
Co-Chair Foster asked what the plan would be for the
initial capitalization from the state.
Mr. Brown responded that it would be the same as the budget
allocation, which was approximately $3.7 million in the
operating budget. He thought the allocation had been
pleasingly consistent.
9:23:40 AM
Representative Wool referred to the license plate handout.
He noted that the artistic plate was the most popular
option in 2019. He relayed that when he had recently gone
to get a new license plate, he was told by a DMV employee
that he would simply get whichever plate was on the top of
the pile and he did not get a choice. He asked if the
surcharge might cause the amount of artistic plates
distributed to go down.
Mr. Brown would be surprised if it was normal DMV procedure
to get the plate that was at the top of the pile. He
thought the only thing that would change would be that the
artistic license plate would include the surcharge. He
thought the question would be better suited for DMV in
terms of how staff was trained. The goal was to make sure
the license plates were accessible. He assured the
committee that the artistic plate contest would be highly
publicized.
Co-Chair Merrick jokingly asked if rank-choice voting would
apply.
Mr. Brown supposed that it could, but it would be at the
discretion of the council.
Representative Thompson was in favor of the bill and
offered to cosponsor it.
9:26:49 AM
Co-Chair Merrick asked Mr. Brown to present the fiscal note
from the Department of Education and Early Development
(DEED)with control code zPppx.
Mr. Brown deferred to Mr. Lamkin.
9:27:08 AM
AT EASE
9:28:19 AM
RECONVENED
ANDREA NOBLE, EXECUTIVE DIRECTOR, ALASKA STATE COUNCIL ON
THE ARTS, EAGLE RIVER (via teleconference), explained that
Fiscal Note 6 with control code zPppx had a one-time impact
of $6,000 in order to meet the obligations set forth in
regulation.
9:30:17 AM
Co-Chair Merrick asked Mr. Steininger to review Fiscal
Note 4 put forth by the governor with control code FVAZY.
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, explained that the fiscal note was
indeterminate and structured to ensure that the fund would
not be considered a dedicated fund. It would ensure that
the funds were appropriated by the legislature before
becoming available to the council. The fiscal note was a
placeholder for a language section item that would include
the amount of capitalization should the bill pass.
Co-Chair Merrick indicated Fiscal Note 5 would be reviewed
at a future meeting.
9:31:43 AM
Representative Carpenter asked if there was an estimated
cost that would be incurred by the Department of Law.
Mr. Brown replied that the Department of Law was de facto
counsel for ASCA. In 2019 when funds were vetoed, the
assistant attorney general at the time was having to advise
two clients with diametrically opposed positions, which was
a violation of the rules of conduct. It would have been
better to have a second attorney general to advise ASCA. He
suggested that a fiscal note by the Department of Law would
be indeterminate because ASCA's need for legal counsel was
unpredictable. He added that in the unlikely event that
ASCA needed to hire outside legal counsel, it would not be
a reimbursable service agreement.
Co-Chair Merrick indicated a representative from DMV was
available to review Fiscal Note 5 from the Department of
Administration with control code mqgls.
9:35:04 AM
JEFFERY SCHMITZ, DMV, DIRECTOR, DIRECTOR, DIVISION OF MOTOR
VEHICLES, DEPARTMENT OF ADMINISTRATION (via
teleconference), reviewed the fiscal note. He explained
that DMV made an estimate that just over 3,000 people would
select the artistic plate option. However, it was unclear
how accurate that estimate was. The surcharge amount was
also unknown and the DMV based the estimate on the maximum
surcharge of $50.
Representative Wool asked how license plates were
distributed. He asked if people were able to choose or
simply given the next plate available.
Mr. Schmitz responded that people were given a choice. It
would not be the correct procedure if people were not
offered a choice between plate types.
CSSB 71(FIN) was HEARD and HELD in committee for further
consideration.
9:37:17 AM
AT EASE
9:39:21 AM
RECONVENED
Co-Chair Merrick invited Representative Wool to begin.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 21 Backup Faculty Alliance Support Letter.pdf |
HFIN 4/20/2022 9:00:00 AM |
HB 21 |
| HB 21 Sectional.pdf |
HFIN 4/20/2022 9:00:00 AM |
HB 21 |
| HB 21 Sponsor.pdf |
HFIN 4/20/2022 9:00:00 AM |
HB 21 |
| HB 21 Backup Intro Presentation.pdf |
HFIN 4/20/2022 9:00:00 AM |
HB 21 |