Legislature(1999 - 2000)
03/09/1999 03:31 PM Senate STA
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* first hearing in first committee of referral
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SJR 10-CONST AM: SUPERMAJORITY FOR TAX LEVIES
MARK HODGINS presented SJR 10 for its sponsor, Chairman Ward. SJR
10 creates a constitutional amendment that requires a two-thirds
majority vote of both the House and Senate to levy any new state
taxes or increase the rate of any present state tax. If passed,
the constitutional amendment will be placed before the voters at
the next general election. Fourteen other states have passed
similar legislation to enact or increase various state taxes. SJR
10 allows the citizens of Alaska to vote on taxation.
CHAIRMAN WARD asked if "taxes" are defined in statute. MR. HODGINS
did not have an exact definition.
CHAIRMAN WARD noted he has requested a legal definition of "taxes"
because it is not his intent to include fees.
Number 531
SENATOR ELTON expressed concern about the Alaska Seafood Marketing
Institute's (ASMI) processor assessment. He explained that
assessment is levied by processors by a vote of 50 percent plus
one. The assessment currently equals a fee of three percent of the
value of the product. That money is deposited in the General Fund
and appropriated for domestic marketing programs. He asked whether
SJR 10 will limit the processors' ability to raise the fee.
CHAIRMAN WARD said he has the same concern and has asked the same
question. He clarified if the assessment is called a "fee," it is
not considered a tax.
SENATOR ELTON questioned whether an assessment would be considered
a fee. CHAIRMAN WARD said all fees and other revenue-generating
mechanisms that are not called a "tax" are not subject to the two-
thirds majority vote.
SENATOR GREEN asked if the ASMI assessment must be approved by the
Legislature. SENATOR ELTON replied that statutory authority is
granted by the Legislature which allows processors to self-assess.
Number 558
SENATOR GREEN asked if the assessment can be increased without
legislative approval. SENATOR ELTON replied the processors can
increase or decrease the assessment amount under the statutory
structure.
SENATOR PHILLIPS noted the Legislature must approve General Funds
for reappropriation for domestic marketing efforts. SENATOR ELTON
said that is true, and the Legislature has always acted in good
faith and reappropriated those funds.
MR. HODGINS reviewed the tax levy requirements of the other 14
states. Delaware, Florida, Mississippi, and Oregon require a 3/5
vote of their legislatures to enact taxes; Florida also requires
a 2/3 vote of the public to enact new taxes. Arizona, California,
Louisiana, Nevada, South Dakota, and Washington require a 2/3 vote
of their legislatures to enact taxes. Missouri requires a 2/3 vote
of the public to enact or increase taxes. Arkansas, Colorado, and
Oklahoma require a 3/4 vote of their legislatures to enact taxes.
The vote requirement does not apply to all taxes: some apply to
either income, sales, or property taxes.
SENATOR WILKEN questioned whether any of those states have
dedicated funds that the voting requirements do not apply to. MR.
HODGINS assumed they do. SENATOR WILKEN noted the people may not
have a say in how certain expenditures are made because their
states have dedicated funds.
TAPE 99-4, SIDE B
SENATOR GREEN moved SJR 10 from committee with individual
recommendations. SENATOR ELTON objected and commented he does not
know how he would have voted in the early 1990's on the
Constitutional Budget Reserve (CBR). He believes SJR 10 is the
flip side of that issue. He could argue that the supermajority
vote required to use CBR funds limits the Legislature's ability to
accomplish the legislative agenda. He sees SJR 10 as creating an
additional limit.
The motion to pass SJR 10 from committee carried with Senators
Phillips, Green, Wilken, and Ward voting "yea," and Senator Elton
voting "nay."
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