Legislature(1999 - 2000)
04/29/1999 03:40 PM House FIN
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 157
"An Act relating to absences from the state while
serving on oceangoing vessels of the United States
merchant marine for purposes of eligibility for
permanent fund dividends; and providing for an
effective date."
REPRESENTATIVE JERRY SANDERS, SPONSOR spoke in support of HB
157. He noted that there are several merchant mariners in
Alaska who do not receive the permanent fund dividend even
though they live and maintain a residence in Alaska. He gave
examples of mariners who live in Alaska. He noted that the
number of people that the bill would affect is small.
Representative J. Davies questioned why Peace Corps
volunteers were not included. Representative Sanders
responded that the intent was to keep the legislation narrow
to increase its chances of passage.
Representative Austerman expressed support for the
legislation but questioned the number of permanent fund
dividend exceptions. He asked if a merchant marine serves on
a vessel that does not dock in Alaska if they would receive
the permanent fund dividend.
HAROLD HOLTON, REPRESENTATIVE, SEAFARERS INTERNATIONAL
UNION, ANCHORAGE stated that if a merchant marine sailed off
and did not return for two or three years they would not be
considered a resident. He stressed that the Alaskan merchant
marine jobs are very unique. The important issue is where
mariners reside when they are off the ship.
Co-Chair Therriault observed that the exception states:
"serving under foreign or coastal articles of employment
aboard an oceangoing vessel of the United States merchant
marine." He observed that the individual that has a home in
Valdez might or may not come home when he is off the ship.
Mr. Holton stated that it is the intent to allow Alaskans to
accept jobs. He showed members a video overview of their
training program in Piney Point, Maryland.
Mr. Holton provided members with written testimony:
I was born in Ketchikan, raised in Ketchikan,
Petersburg, and Juneau, upon my completion of 6 years
in the Marine Corps, I came back to Alaska and became a
state trooper for a short period of time. I was a
Salmon tender captain for 15 years, before becoming a
union rep.
The Seafarers opened an office in Anchorage, almost 2
years ago to the day. Our objective is to recruit
Alaskans to go to our unlicensed apprenticeship program
in Piney Point, Maryland, and give them an opportunity
to obtain good paying jobs with good benefits when they
complete the program.
I first became alerted to the fact that Merchant Seamen
were being denied their permanent fund, by a Merchant
Seaman from a different union. His name is Ross Perrine
from Palmer, and he owns a home, has an Alaska driver's
license, voter registration card, etc. he has been
denied the fund since the inception. I went to one of
our ships, and found that a boatswain on the Tote ship
Northern Lights has also experienced the same problems.
His name is John Glenn and he will be testifying this
afternoon.
My recruiting effort has taken me around a lot of the
state, and in my interviews with young people, I seem
to have their interest in the program until the
question of the Permanent Fund dividend comes up, then
I am told they are no longer interested. I thought to
myself and have shared this view, that these people
seemed awfully shortsighted, until I really thought
about it, this is probably the only steady money. They
have ever seen, and are reluctant to let it go under
any circumstance.
One of our recent graduates (Jessie Sharp) who will
testify this afternoon, that already this year he has
been denied the Permanent Fund dividend
These merchant seaman being denied, does not have a
choice when they sail, as to whether they can sail in
Alaska or not. Sailing is based on a seniority system,
and believe it or not, our Alaska routes, are in high
demand. The ones that have the Alaska routes Ross and
John are denied because they are not physically in
state a minimum of 180 days.
All of our Alaskans have been accepted to Piney Point
because they are Alaska residents. I would hate to
discourage good young people, (short sighted as they
may be) from enjoying such a career opportunity.
Right now we have 18 Alaskans who have graduated from
Piney Point, and we presently have 2 in school. Besides
the 18 graduates, we have created a Riding Maintenance
gang. These merchant seaman go on oil tankers and do
preventative maintenance. We hired 10 Riding gang a
year ago, and all have done an outstanding job. When
they have a year of sea time, they will be sent back to
Piney Point and upgraded to Able-bodied seaman. We will
start training and working a new crew. This crew
averages $3,200.00 per month, with full benefits. Two
of these Merchant Seaman have recently put money down
on homes in the Wasilla area. They also will be denied
their Permanent Fund dividend.
An article in the Anchorage news recently the 12th did
an article on our first native Alaskan. This has
generated such a positive response it is hard for me to
keep up with it. The first day generated about 20 phone
calls, and yesterday I received 71 inquires. This has
resulted in 6 tests being given Monday, and 6 more done
on Friday. Plus 2 in Soldotna, 1 in Anchor Point, 2 in
Kodiak, 2 in Ketchikan, and several from Willow. These
numbers are candidates that are qualified.
In my estimation, we are not talking about any more
than 200 Merchant Seaman over a ten-year Period.
Representative J. Davies summarized that mariners working in
other seas would still have to maintain an Alaskan
residency. Co-Chair Therriault asked if consideration was
given to restricting the legislation to individuals sailing
from Alaskan ports.
(Tape Change, HFC 99 - 114, Side 2)
Mr. Holton stated that there are individuals that do sail
out of Anchorage. He pointed out that they would ship out of
Alaska regardless of where they sail. Representative Sanders
stressed that they have to fulfill the other resident
requirements.
Representative Austerman noted that they could be gone for
up to two years. He observed that the intent is to cover
individuals that are residents and are dispatched out of
Alaska to do a job for four months to be eligible for their
permanent fund dividend.
Mr. Holton clarified that there are not enough Alaskans to
ship out of Alaska. He observed that graduates ship out of
Piney Point when their training is finished. He anticipates
that there will eventually be an Alaskan dispatch hall.
Representative Austerman expressed surprise that the
legislation did not reference shipping out of Alaska. Mr.
Holton stated that he would not be adverse to an amendment
to tighten the language.
Representative J. Davies questioned if "dispatched" out of
Alaska would be an appropriate qualifier. Mr. Holton stated
that it would be an appropriate qualifier.
JOHN GLENN, SEAMAN, ANCHORAGE testified via teleconference
in support of the legislation. He stated that he has been
denied the permanent fund dividend. He observed that many
ferry workers receive permanent fund dividends. He stated
that he feels like a second class citizen, while everything
he does is in Alaska.
EDEN LATTA, MERCHANT MARINE, ANCHORAGE testified via
teleconference in support of the legislation. He noted that
he is a graduate from the Piney Point program. He was also
denied his permanent fund dividend. He stressed that he
lives in Alaska when he is off of the ship and meets other
residency requirements.
In response to a question by Representative Austerman, Mr.
Latta stated that he has been a merchant marine since 1997.
He has left Alaska twice as a merchant marine.
JOY TUCKER, ANCHORAGE testified via teleconference in
support of the legislation. He noted that her husband works
as a merchant marine. She stressed that they live in Alaska
and he returns home when he is off of the ship.
DEBORAH VOGT, DEPUTY COMMISSIONER, DEPARTMENT OF REVENUE
provided information on the legislation. She emphasized that
the list of allowable absences does not include all
Alaskans. She observed that the legislature has identified
Alaskans that qualify. She noted that there are inequities.
The commissioner has been allowed to include individuals
that demonstrated their intent to return. The provision was
difficult to administer. The department adopted the 180-day
absence provision as an alternative. She noted that the
commissioner's discretion was removed during the prior
session. She stated that the proposed exemption is clear and
would not be difficult to administer. She noted that the
intent would be to support individuals that do remain in
Alaska and whose families remain in Alaska.
Representative J. Davies questioned if the department would
support "dispatched out of Alaska". She stated that the
department would not object to the addition.
Mr. Vogt explained that the two-year return rule requires
that Alaskans return to the state within two years for a
minimum of 72 hours. She added that if an individual is gone
for over five years there would be a presumption that there
is not an intention to remain in the state. Individuals can
demonstrate to the contrary. Another provision that will go
into effect in the current year would prevent a continuous
absence for more than 10 years for any reason.
Representative Austerman noted that military personal who
come to Alaska register as an Alaskan resident and continue
to get the permanent fund dividend after they transfer, as
long as they return within two years for a minimum of 72
hours. After five years they would be ineligible. Ms. Vogt
clarified that they would be presumed ineligible unless they
affirmatively prove that they have substantial ties to the
state. Military spouses are also eligible.
In response to a question by Representative J. Davies, Ms.
Vogt noted that the definition of "state resident" in AS
43.23.005 is modified by AS 43.23.095:
"state resident" means an individual who is physically
present in the state with the intent to remain
indefinitely in the state under the requirements of AS
01.10.055 or, if the individual is not physically
present in the state, intends to return to the state
and remain indefinitely in the state under the
requirements of AS 01.10.055:
(a) A person establishes residency in the state by
being physically present in the state with the intent
to remain in the state indefinitely and to make a home
in the state.
(b) A person demonstrates the intent required under (a)
of this section
(1) by maintaining a principal place of abode in the
state for at least 30 days or for a longer period if a
longer period is required by law or regulation; and
(2) by providing other proof of intent as may be
required by law or regulation, which may include proof
that the person is not claiming residency outside the
state or obtaining benefits under a claim of residency
outside the state.
(c) A person who establishes residency in the state
remains a resident during an absence from the state
unless during the absence the person establishes or
claims residency in another state, territory or
country, or performs other acts or is absent under
circumstances that are inconsistent with the intent
required under (a) of this section to remain a resident
of this state.
Ms. Vogt noted that the department looks at extenuating
circumstances to determine if they are retaining ties to the
state. She noted that the department looks to see if a
person has friends or family present when the five-year
presumption arises. She clarified that the qualifying year
is the prior calendar year.
Representative J. Davies observed that the applicant must be
physically present during the qualifying year or if absent
was absent only as allowed in the exceptions.
NANCI JONES, DIRECTOR, ALASKA PERMANENT DIVIDEND DIVISION,
DEPARTMENT OF REVENUE pointed out that the trainees were not
denied because they were away at training. Training is an
allowable absence. They were denied because the did not
return after the training.
In response to a question by Representative Moses, Ms. Vogt
noted that on the 1998 permanent fund dividend there were
4,419 armed forces absent from the state. There were also
2,100 spouses and 4,600 children accompanying an Alaskan
resident who was eligible for a permanent fund dividend.
Representative J. Davies MOVED to insert on page 2, line 2
"dispatched out of Alaska and." Representative G. Davis
OBJECTED for the purpose of discussion. He questioned if
the definition of "dispatched" would be problematic.
Representative Sanders stated that he did not oppose the
amendment but did not think it was necessary. Ms. Vogt
stated that the department would work with the union to
define "dispatch" through regulation. She did not think
there would be a difficulty.
Representative Moses pointed out that a person could be
dispatched out of the state without being present in the
state. Ms. Vogt emphasized that the department would look at
where the applicant spent their time. Representative G.
Davis did not think the amendment was necessary.
Representative J. Davies stated that the intent is to
encourage opportunities for Alaskans. He stressed that it
would provide an incentive for an Alaskan office.
Representative Sanders pointed out that some merchant
mariners do not belong to the union. He questioned if there
would be a problem for non-union mariners. Representative J.
Davies WITHDREW his amendment.
Co-Chair Therriault recalled a situation with one of his
constituents. In response to comments by Co-Chair
Therriault, Ms. Vogt stated that the merchant marine list is
a definite list. She observed that there are other people
that are not on the merchant marine list that work outside
of Alaska for employment. She noted that other legislation
was offered to pay Alaskans that work outside of the state.
The department had trouble with that legislation because it
is hard to tell if an employee is required by their employer
to leave the state. It would be hard to administer because
the lines are "fuzzy". Co-Chair Therriault observed that
congressional staff receives permanent fund dividends if
they work in the congressional legislator's office but not
if they work for the committee chaired by the Alaskan
member.
Representative Moses noted that there are a significant
number of people living out of the state and collecting the
permanent fund dividend.
Representative Austerman stressed that individuals make
lifestyle choices. He expressed concern with the number of
exceptions. Co-Chair Therriault echoed his concerns.
Representative J. Davies stressed that there are equity
issues. He pointed out that there has to be a good public
interest reason for treating Alaskans differently. He
maintained that people should qualify if they meet the
resident requirements.
Representative G. Davis MOVED to report HB 157 out of
Committee with the accompanying fiscal note. There being NO
OBJECTION, it was so ordered.
HB 157 was REPORTED out of Committee with a "do pass"
recommendation and with a zero fiscal note by the Department
of Revenue dated 4/16/99.
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