05/19/2003 03:23 PM House L&C

SB 112-MOTOR FUEL TAX:GOVT AGENCY REFUNDS                                                                                     
                                                                                                                                
CHAIR ANDERSON announced  that the final order  of business would                                                               
be  CS FOR  SENATE BILL  NO. 112(FIN),  "An Act  relating to  tax                                                               
refunds for  government agency purchases  of fuel;  and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
Number 0412                                                                                                                     
                                                                                                                                
KEVIN   JARDELL,   Assistant    Commissioner,   Office   of   the                                                               
Commissioner, Department  of Administration,  spoke on  behalf of                                                               
the sponsor of  SB 112, Senate Rules Committee by  request of the                                                               
governor.  Mr. Jardell explained  that CSSB 112(FIN) now contains                                                               
a technical  fix to  a statute  that will  allow Alaska  to fully                                                               
utilize its new credit card.   Currently, a reseller of fuel when                                                               
purchasing fuel from a wholesaler pays  the entire gas tax to the                                                               
wholesaler.  [The reseller] recoups the  tax when the gas is sold                                                               
to the consumer, who pays the  fuel price plus the tax.  However,                                                               
when  the  Department  of   Transportation  &  Public  Facilities                                                               
(DOT&PF) purchases the  fuel, the department doesn't  pay the tax                                                               
because  the  state is  exempt  from  the  tax.   Therefore,  the                                                               
reseller  doesn't  recoup the  tax  paid  when the  purchaser  is                                                               
DOT&PF.   Current statute  specifies that  a reseller  can recoup                                                               
the  tax from  the Department  of  Revenue by  sending in  forms.                                                               
However, the state's new credit  card would assume the "headache"                                                               
with regard  to recouping the tax  rather than the reseller.   In                                                               
order to  use this ability the  statutes need to be  changed such                                                               
that  the  participation  to  include  the  state's  credit  card                                                               
company  as well  as  the  already specified  reseller.   Such  a                                                               
change will  make this process  more efficient because  the state                                                               
will  only have  to deal  with one  vendor, one  entity, and  one                                                               
form.                                                                                                                           
                                                                                                                                
Number 0508                                                                                                                     
                                                                                                                                
REPRESENTATIVE  LYNN  moved  to   report  CSSB  112(FIN)  out  of                                                               
committee  with individual  recommendations and  the accompanying                                                               
zero fiscal note.  There being no objection, it was so ordered.