05/08/2023 03:30 PM Senate RESOURCES

                  SB 137-REFINED FUEL SURCHARGE                                                                             
                                                                                                                                
4:03:11 PM                                                                                                                    
CO-CHAIR BISHOP  announced the consideration  of SENATE  BILL NO.                                                               
137  "An  Act  relating  to   the  refined  fuel  surcharge;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
He  noted  that there  was  an  amendment  for the  committee  to                                                               
consider.                                                                                                                       
                                                                                                                                
4:03:26 PM                                                                                                                    
CO-CHAIR  GIESSEL moved  to  adopt Amendment  1,  work order  33-                                                               
LS0768\B.2, for SB 137.                                                                                                         
                                                                                                                                
                                                 33-LS0768\B.2                                                                  
                                                      Dunmire                                                                   
                                                      4/26/23                                                                   
                                                                                                                                
                                                                                                                                
                          AMENDMENT 1                                                                                       
                                                                                                                                
                                                                                                                                
     OFFERED IN THE SENATE              BY SENATOR BISHOP                                                                       
          TO: SB 137                                                                                                            
                                                                                                                                
     Page 1, line 3:                                                                                                            
           Delete "AS 43.40.005(a)"                                                                                             
           Insert "AS 43.40.005"                                                                                                
     Page 1, following line 5:                                                                                                  
          Insert a new subsection to read:                                                                                      
               "(b) The following refined fuels are exempt                                                                      
               from the surcharge imposed under                                                                                 
          this section:                                                                                                         
                    (1) fuel sold to a federal or state                                                                         
                    government agency for official use;                                                                         
                    (2) fuel consigned to a foreign                                                                         
                   country [REFINED AND USED                                                                                
          OUTSIDE THE UNITED STATES];                                                                                           
                    (3) liquefied petroleum gas;                                                                                
                    (4) aviation fuel;                                                                                          
                    (5) fuel sold or transferred between                                                                        
                    qualified dealers."                                                                                         
                                                                                                                                
CO-CHAIR BISHOP objected for purposes of discussion.                                                                            
                                                                                                                                
CO-CHAIR  GIESSEL explained  the genesis  for Amendment  1. A  US                                                               
flagged tug  and barge company  transports fuel to  Skagway where                                                               
it is  loaded onto  a truck that  is owned and  operated by  a US                                                               
firm and trucked  to the Yukon Territory.  The amendment proposes                                                               
exempting  that company  from paying  the refined  fuel surcharge                                                               
because the fuel is not used in the US.                                                                                         
                                                                                                                                
4:04:22 PM                                                                                                                    
CO-CHAIR  BISHOP removed  his objection.  He  noted that  Brandon                                                               
Spanos was available to answer questions.                                                                                       
                                                                                                                                
CO-CHAIR  GIESSEL asked  Mr. Spanos  to articulate  the potential                                                               
financial impact of the amendment.                                                                                              
                                                                                                                                
4:04:57 PM                                                                                                                    
BRANDON  SPANOS, Deputy  Director,  Tax  Division, Department  of                                                               
Revenue, Anchorage, Alaska,  stated that he was  unable to answer                                                               
the question  because too few  taxpayers are affected to  be able                                                               
to aggregate the information. The  only available information was                                                               
confidential.                                                                                                                   
                                                                                                                                
4:05:31 PM                                                                                                                    
SENATOR DUNBAR asked if that means  that the fiscal note that the                                                               
Finance  Committee  considers won't  reflect  the  impact of  the                                                               
proposed amendment.                                                                                                             
                                                                                                                                
MR.  SPANOS responded  that the  division will  amend the  fiscal                                                               
note if the amendment passes. It  will state that there will be a                                                               
negative impact  on revenue but  the amount is  indeterminate due                                                               
to taxpayer confidentiality.                                                                                                    
                                                                                                                                
CO-CHAIR BISHOP said the members  will see the fiscal note before                                                               
the bill leaves the committee.                                                                                                  
                                                                                                                                
4:06:15 PM                                                                                                                    
SENATOR WIELECHOWSKI asked at what level the tax is paid.                                                                       
                                                                                                                                
MR. SPANOS  replied that the  tax is assessed on  the distributor                                                               
when the fuel is sold to the retailer.                                                                                          
                                                                                                                                
4:06:47 PM                                                                                                                    
CO-CHAIR BISHOP  found no further  objection and Amendment  1 was                                                               
adopted.                                                                                                                        
                                                                                                                                
4:06:56 PM                                                                                                                    
CO-CHAIR BISHOP held SB 137 in committee.