05/18/2003 01:03 PM Senate FIN

                                                                                                                                
     CS FOR SENATE BILL NO. 112(TRA)                                                                                            
     "An Act increasing  the motor fuel tax; repealing  the special                                                             
     tax  rates  on blended  fuels;  removing  the motor  fuel  tax                                                             
     exemption of the Alaska Railroad;  relating to tax refunds for                                                             
     government  agency purchases  of  fuel; and  providing for  an                                                             
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
This was  the second hearing  for this bill  in the Senate  Finance                                                             
Committee.                                                                                                                      
                                                                                                                                
Co-Chair  Wilken stated that  this bill  would "increase the  motor                                                             
fuel tax."  He indicated a proposed  committee substitute,  Version                                                             
                                                                                                                                
                                                                                                                                
Co-Chair Green moved  for adoption of CS SB 112, 23-GS1118\W,  as a                                                             
working draft.                                                                                                                  
                                                                                                                                
Co-Chair Wilken objected for an explanation.                                                                                    
                                                                                                                                
KEVIN    JARDELL,    Assistant    Commissioner,    Department    of                                                             
Administration,   testified  to  the   changes  in  the   committee                                                             
substitute. He stated that the  "uncontroversial portions have been                                                             
removed". He spoke to the request  for proposals (rfp) the Division                                                             
of Finance  issued for credit  cards and  the provision that  those                                                             
credit  cards must be  authorized  for use in  purchasing fuel.  He                                                             
indicated he had  elaborated on this subject at a previous  hearing                                                             
and  stated  that  this  bill  was  chosen  as  the  "vehicle"  for                                                             
implementing  the intended  policy. He remarked  that because  this                                                             
legislation  was not progressing  through  the Legislature,  it was                                                             
determined that the  motor fuel tax provisions would  be deleted to                                                             
allow consideration of the credit card provision. He clarified that                                                             
only  language  pertaining  to credit  cards  is contained  in  the                                                             
committee substitute.                                                                                                           
                                                                                                                                
Senator Hoffman opined  that the committee substitute  is, "a major                                                             
move in the right direction."                                                                                                   
                                                                                                                                
There was no objection and the committee substitute Version "W" was                                                             
ADOPTED as a working draft.                                                                                                     
                                                                                                                                
Senator Taylor  offered a motion to  report the CS SB  112, Version                                                             
"W" from Committee with individual  recommendations and forthcoming                                                             
fiscal notes.                                                                                                                   
                                                                                                                                
Without objection  CS SB 112 (FIN)  MOVED from Committee  with zero                                                             
fiscal notes  dated 5/18/03 from  the Department of  Administration                                                             
and the Department of Revenue.                                                                                                  
                                                                                                                                
AT EASE 1:26 PM / 6:58 PM