Legislature(2011 - 2012)CAPITOL 17
03/15/2011 01:00 PM House TRANSPORTATION
| Audio | Topic |
|---|---|
| Start | |
| HB64 | |
| HB10 | |
| HB131 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 64 | TELECONFERENCED | |
| += | HB 10 | TELECONFERENCED | |
| *+ | HB 131 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 64-PERMANENT MOTOR VEHICLE REGISTRATION
[Contains brief discussion of HB 10, a related bill that affects
noncommercial trailer registration fees.]
1:07:51 PM
CHAIR P. WILSON announced that the first order of business would
be HOUSE BILL NO. 64, "An Act relating to permanent motor
vehicle registration; and providing for an effective date."
CHAIR P. WILSON asked Representative Petersen to report on the
work the subcommittee did on the motor vehicle and trailer
registration fee bills.
1:08:21 PM
REPRESENTATIVE PETERSEN referred to the subcommittee work on HB
10 and HB 64 and indicated the subcommittee met and have made
suggestions to the committee for consideration. He asked his
staff to provide details.
DAVID BREMER, Staff, Representative Pete Petersen, Alaska State
Legislature, explained the changes the subcommittee recommended,
which he said are incorporated into a proposed committee
substitute for the committee's consideration. He stated that
the subcommittee suggested removing the language in proposed
subsection (b) that referred to the lesser of five times the
rate or $100, and replaced it with "three times the rate" which
would apply to the registration fee rate and the Motor Vehicle
Registration Tax (MVRT) collection. The subcommittee suggested
adding a new section, proposed section 4, which would allow a
municipality to establish a permanent MVRT. A municipality
could charge more or less than the three times set in subsection
(b) of the bill.
MR. BREMER reported the subcommittee considered issues with
respect to collections budgeting discussed at prior committee
hearings for both the vehicle registration and noncommercial
trailer registration. He stated that the state revenues would
increase for two years, but revenues would drop off for each
year thereafter. Currently, emissions tests (I/M) are required
in Anchorage. Owners would still be required to obtain
emissions test and present the results to the DMV at the time of
renewal. Older vehicles are most likely to fail I/M testing,
and someone who has permanent registration may move into an I/M
area and there is no way to verify the vehicle can comply with
the IM requirements. Owners in I/M areas would still be
required to obtain I/M testing.
1:13:30 PM
MR. BREMER related that HB 64 is based on Montana's law, which
allows for permanent motor vehicle registration based on a fee
of five times the vehicle registration rate for vehicles that
are 11 years old. The subcommittee suggests inserting language
eight years old and three times the rate. Once a vehicle
reaches 14 years, a municipality would begin to lose revenue.
The benchmark arrived at is a combination of the vehicle age and
a multiplier of the registration rate. He said that 34 years is
the point at which the bill becomes revenue neutral. Montana
permanent registration also applies to light vehicles only, or
vehicles of one ton or less whereas the proposed HB 64 would
apply to all vehicles. Montana provides the county treasurer
the authority to collect the motor vehicle tax. In Alaska, the
tax is an MVRT, which is not collected by municipalities.
However, the bill allows a municipality to establish a permanent
MVRT. in the original HB 64, motorcycle fees were set higher
than the MVRT. The subcommittee removed the lesser of five
times the rate or $100, which addresses the motorcycle fee
issue, he said.
MR. BREMER recalled the issue of safety, noting that people may
wish to drive their motor vehicle longer, which could lead to an
increase in the number of unsafe cars on the roadway. Permanent
registration is not transferable, but is not enforceable unless
a driver is pulled over by law enforcement. Some members
expressed concern over liability issues if a vehicle with
permanent registration is sold and not reregistered. This
issued is not easily detected unless the person is involved in a
vehicular accident.
1:16:10 PM
MR. BREMER related a concern with respect to DMV funding, which
is receipt based funding. If the DMV revenues decreased to a
level below the necessary funding level, the legislature would
need to enact a new funding mechanism for the DMV's day-to-day
operations.
MR. BREMER highlighted the current Municipality of Anchorage
(MOA) tax cap limits the amount of taxes the MOA can collect.
This bill would increase MVRT revenues in the first two years
significantly with a corresponding property tax decrease. In
year three and thereafter, MVRT revenues would significantly
decrease, which could adversely affect MOA property tax rates.
The MOA's tax cap is calculated annually based on all tax
revenues collected, including property tax, liquor taxes,
tobacco taxes. As MVRT tax income decreases property taxes
would increase.
MR. BREMER related that the subcommittee discussed potential
amendments to HB 64. The first amendment was proposed and
withdrawn for further discussion by the full committee. The
subcommittee considered on page 1, line 12 of HB 64 to replace
"eight" with "fourteen" to push back the eligibility date of
vehicles to lessen potential revenue loss. He reiterated that
the amendment was proposed, discussed, and withdrawn.
MR. BREMER stated the subcommittee considered on page 2, lines
5-6 of HB 64, to replace "three" with "six" times the permanent
registration fees to increase permanent registration cost and
reduce revenue loss. This amendment was considered and
withdrawn. Finally, the subcommittee considered on page 2, line
29 of HB 64 to replace 2012 with 2014 to allow municipalities to
set a permanent MVRT. The municipality must file a notice of
change by January 1 of the preceding year in which the tax
change would take effect. A municipality may not change the
amount of the tax imposed more than once every two years. Some
municipalities set their MVRT last year and would need the
effective date adjusted to enact a permanent motor vehicle
registration tax without incurring a drastic loss of revenue.
1:20:40 PM
MR. BREMER recapped the subcommittee's work on HB 10.
Currently, owners can register their commercial trailers by
paying a one-time fee for permanent registration. This bill, HB
10, would offer the same consideration for owners to register
noncommercial trailers. Some of the same issues were raised,
but the revenue issues were minimal. The sponsor suggested
incorporating language from Section 4, of 64 into HB 10, in
order to allow municipalities a mechanism to collect any
permanent MVRT for trailers. This provision is necessary in the
event that HB 10 passes prior to passage of HB 64.
1:21:52 PM
REPRESENTATIVE PRUITT moved to adopt the proposed committee
substitute (CS), labeled 27-LS0327\I, Luckhaupt, 3/14/11, as the
working document. There being no objection, Version I was
before the committee.
1:22:23 PM
DARRELL BREESE, Staff, Representative Bill Stoltze, Alaska State
Legislature, on behalf of one of the prime sponsors of HB 64,
Representative Bill Stoltze, stated that the sponsor reviewed
and the agrees with the changes incorporated into the proposed
CS, Version I. He also discussed the effective date change with
the sponsor, who agrees since it would allow the municipalities
to make an adjustment to the MVRT. Additionally, the sponsor
agreed to add the language from proposed Section 4 of HB 64 to
HB 10, which would allow the permanent registration rate to be
set for noncommercial trailer ownership.
1:23:14 PM
REPRESENTATIVE MUNOZ referred to the issue for the MOA. She
asked if the municipality takes advantage of increased revenues
and budgets the revenues over ten years whether the MOA would
run into the problem of revenue shortfalls after year two of the
permanent registration for motor vehicles.
MR. BREESE answered no. He discussed this with the MOA mayor's
office, who advised him that so long as the MVRT is collected in
2010 but accounted for 2011-13, that the MOA would not have
issues with major adjustment to the tax cap or tax revenue
collected. The MOA could assign the MVRT revenue to a different
year, such as 2011-2013, the revenue would affect the tax cap in
the subsequent years.
1:24:24 PM
REPRESENTATIVE MUNOZ recapped the amendments the subcommittee
discussed. The subcommittee did not have consensus on two
amendments. She clarified that the subcommittee brought up the
first amendment for discussion to push back the eligibility date
to a higher level but did not reach any consensus.
1:25:24 PM
MR. BREESE, in response to Chair P. Wilson, explained that if a
municipality decides to set an MVRT rate, the rate it sets would
cover the municipal tax imposed for the life of the vehicle. In
further response to Chair P. Wilson, he described the
registration fees. Currently, Alaska statutes allow a motor
vehicle registration tax (MVRT) rate to be collected on the age
of the motor vehicle. As per the table set in existing statute,
once a vehicle is eight years old, the rate is flat. Thus,
additional MVRT is not imposed on motor vehicles eight years or
older. A municipality can also elect to impose an additional
MVRT, by ordinance. He recalled that currently, 16
municipalities have done so. He related a scenario in which a
municipality would charge $50 or $100, instead of charging a fee
of $25 set in current statute. The municipality can set the
rate based on the vehicle age and at a rate that a municipality
determines provides adequate revenue for the municipality.
CHAIR P. WILSON asked whether a municipality could add
additional fees in year nine or 10.
MR. BREESE answered that after year eight, the MVRT rate would
be flat, but the provision would allow a municipality to set a
fee for motor vehicle owners who elect to have permanent
registration. Thus, a municipality could impose an extra fee
and decide the amount of the fee required to register the
vehicle permanently to keep the municipal revenue neutral.
Additionally, the municipality could decide to accept the "three
times" fee as currently written. The proposed Section 4 of the
committee substitute (CS) for HB 64 would allow a municipality
to set a certain tax for permanent motor vehicle registration.
It is possible an owner could decide to wait until his/her
vehicle is 12 years old before permanent registration is
selected. At the point an owner selects permanent registration,
any municipal fees would apply, if the municipality has passed
an ordinance imposing additional one-time registration fees on
motor vehicles, he said. In further response to Chair P.
Wilson, Mr. Breese he reiterated the process municipalities
would use to collect either three times the MVRT or another
amount set by municipal ordinance for any amount it elects to
adopt.
1:29:37 PM
REPRESENTATIVE PETERSEN pointed out that the MOA's Treasurer,
Cheryl Frasca, said the collection of the MVRT is based on
collection rather than on budgeting. He related his
understanding that the MOA is not set up to collect taxes in one
year and budget it over other years.
1:30:15 PM
RICK GIFFORD, Manager, Kodiak Island Borough (KIB), stated that
the KIB still has concerns with HB 64. He said it was unclear
in HB 64 exactly how the MVRT will be administered and
collected. He related his understanding that municipalities use
the MVRT funds for abandoned vehicles, noting that the older
vehicles cause problems in Kodiak. He recalled that the DMV had
a similar fund and reducing the overall MVRT collected would
impact the DMV's ability to assist municipalities. He expressed
his concern over HB 64.
1:32:45 PM
WHITNEY BREWSTER, Director, Division of Motor Vehicles (DMV),
Department of Administration (DOA), stated the CS drastically
reduces the fiscal note from the DMV. She advised the FN was
submitted just prior to this hearing. She highlighted that
removing certain language from the bill solidifies the fees
collected by the DMV.
CHAIR P. WILSON related that she has not yet received the fiscal
note and asked for clarification.
MS. BREWSTER understood. The Governor's office prepared a draft
fiscal note since the CS had not yet been adopted. In the first
year, FY 2012 the change in revenue would increase to
$3,550,000, and revenue would increase in FY 2013 to $4,120,000.
In FY 2014, the DMV anticipates a revenue reduction of $1.2
million, in FY 2015 the DMV anticipates a revenue reduction of
$1,500,000, in FY 2016 the DMV estimates a revenue reduction of
$1,500,000, and in FY 2017 the DMV estimates a $1,800,000
revenue reduction. She stated that the CS dramatically changes
the fiscal note. In response to Chair P. Wilson, she responded
that the DMV's proposed budget is approximately $16 million.
She stressed that with the adoption of the proposed CS, the DMV
does not see an impact on the DMV's budget. In further response
to Chair P. Wilson, she indicated that the proposed changes will
reduce the overall revenue collected, but in FY 10 the DMV
collected approximately $65.8 million in revenue, which is still
substantially more than necessary to run DMV.
CHAIR P. WILSON related the revenue collected would be less
revenue collected for the general fund each year.
MS. BREWSTER agreed.
1:36:16 PM
KATHIE WASSERMAN, Executive Director, Alaska Municipal League
(AML), stated that she spoke to a number of municipalities prior
to the meeting. Many of them indicated that the MVRT funds help
with junk car removal. If this bill passes, the municipalities
will need to determine how much tax to require. She said the
municipalities would estimate the proposed MVRT, since it is not
possible to determine how many years an older vehicle may
operate. Thus, some municipalities will have shortfalls or
excesses, accordingly. Additionally, municipalities would still
need to adopt the tax change by ordinance and may result in some
"pushback" from residents. She is most familiar with the City
and Borough of Juneau, which collects $22 per registered motor
vehicle, or basically $11 per year. If an automobile will be on
the road for an indeterminate amount of time, the municipalities
express concern. The system seemed to work fine. She concluded
that the municipalities are at a loss in terms of assessing the
overall impact, which would likely increase personnel. She
said, "The municipalities are not comfortable with this bill."
1:38:46 PM
CHAIR P. WILSON, after first determining no one else wished to
testify, closed public testimony on HB 64.
1:38:57 PM
REPRESENTATIVE PETERSEN suggested considering the age of vehicle
for eligibility for one-time registration. The current CS uses
eight years, the Montana model uses 11 years. He wondered if
the bill was moved to 11 years it may allow municipalities to be
revenue neutral until motor vehicles are 17 years old. The
number of motor vehicle on the roadway greater than 17 years old
diminishes rather quickly, he said. Thus, it would likely have
a little less effect on municipalities strapped for funding, he
said.
1:41:03 PM
REPRESENTATIVE PETERSEN made a motion to adopt Conceptual
Amendment 1 to HB 64. He referred to page 1, line 12 of HB 64,
to change the applicable vehicle age from "eight" to 11.
REPRESENTATIVE JOHNSON objected.
REPRESENTATIVE JOHNSON related the committee spent considerable
time discussing how to best accommodate the municipalities, but
little time to discuss the convenience or cost savings to
consumers. The point of this bill has somewhat been missed,
which is to save money, time and convenience for consumers. He
said it might be inconvenient for municipalities. He pointed
out that any money municipalities lose is money that is saved by
consumers. He maintained his objection.
1:43:10 PM
A roll call vote was taken. Representatives Munoz, Gruenberg,
and Petersen voted in favor of Conceptual Amendment 1.
Representatives Johnson, Feige, Pruitt, and P. Wilson voted
against it. Therefore, Conceptual Amendment 1 failed by a vote
of 3-4.
1:43:55 PM
REPRESENTATIVE PRUITT moved to report the proposed committee
substitute (CS) for HB 64, labeled 27-LS0327\I, Luckhaupt,
3/14/11, out of committee with individual recommendations and
the accompanying fiscal note. There being no objection, CSHB
64(TRA) was reported from the House Transportation Standing
Committee.
HB 10-NONCOMMERCIAL TRAILER REGISTRATION FEE
1:44:54 PM
CHAIR P. WILSON announced that the next order of business would
be HOUSE BILL NO. 10, "An Act relating to the registration fee
for noncommercial trailers and to the motor vehicle tax for
trailers."
REPRESENTATIVE PRUITT moved to adopt the proposed committee
substitute (CS) for HB 10, labeled 27-LS00091\B, Luckhaupt,
3/14/11, as the working document. There being no objection,
Version B was before the committee.
1:45:12 PM
DARRELL BREESE, Staff, Representative Bill Stoltze, Alaska State
Legislature, on behalf of one of the prime sponsors,
Representative Bill Stoltze, stated that the only change to the
bill contained in the proposed CS is the inclusion to allow
municipalities to adopt by ordinance the permanent vehicle
registration rate for noncommercial trailers.
1:46:17 PM
REPRESENTATIVE PETERSEN made a motion to adopt a Conceptual
Amendment to change the effective date from 2012 to 2014. He
stated he misstated his amendment since the CS for HB 10 does
not have an effective date. He withdrew his amendment.
REPRESENTATIVE PETERSEN made a motion to adopt a Conceptual
Amendment to create an effective date for bill as 2014.
REPRESENTATIVE JOHNSON objected. He pointed out that 2014 is
not a date.
CHAIR P. WILSON referred to the date in the previous bill the
committee just passed out, which was January 1, 2014.
REPRESENTATIVE PETERSEN made a motion to adopt a Conceptual
Amendment to create effective date for HB 10 of January 1, 2014.
REPRESENTATIVE JOHNSON raised a point of order. He said a
motion is before the committee and the motion must be withdrawn
REPRESENTATIVE PETERSEN withdrew his prior motion which did not
contain the date, January 1, 2014.
1:48:30 PM
REPRESENTATIVE PETERSEN made a motion to adopt a Conceptual
Amendment to create an effective date in HB 10 of January 1,
2014.
REPRESENTATIVE JOHNSON objected. He asked to hear from sponsor.
MR. BREESE answered that the sponsor agrees with the inclusion
of the effective date of January 1, 2014.
REPRESENTATIVE JOHNSON withdrew his objection.
There being no further objection, Conceptual Amendment 1 was
adopted.
1:49:14 PM
REPRESENTATIVE PRUITT moved to report the proposed committee
substitute (CS) for HB 10, labeled 27-LS00091\B, Luckhaupt,
3/14/11, as amended, out of committee with individual
recommendations and the accompanying fiscal notes. There being
no objection, CSHB 10(TRA) was reported from the House
Transportation Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 131.Community & Transportation Board.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131 Sectional Analysis.2.2.11.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131.Sponsor Statement.2.14.11.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131.Alaska Mobility Coalition support ltr.2.15.11.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131.Trust transportation priorities.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131.Gov Task Force Recommendation Report.2.11.10.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131.Gov Coordinated Transportation Task Force.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB0131A.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| HB131-DOT-PD-3-11-11.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 131 |
| CSHB64- sub committee version I.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 64 |
| HB64 Vehicle Counts Statewide.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 64 |
| HB 64 CS Section Changes.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 64 |
| HB 64cs Sponsor Statement.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 64 |
| CSHB10 Ver B.pdf |
HTRA 3/15/2011 1:00:00 PM |
HB 10 |