Legislature(1999 - 2000)

02/11/1999 01:07 PM TRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HB 73 - MOTOR VEHICLE REGISTRATION FEES                                                                                         
CHAIR MASEK announced the first order of business was House Bill                                                                
No. 73, "An Act relating to commercial vehicle registration fees                                                                
and taxes; and providing for an effective date."                                                                                
Number 0089                                                                                                                     
TED DEATS, Legislative Assistant to Representative Beverly Masek,                                                               
Alaska State Legislature, read the following sponsor statement into                                                             
the record:                                                                                                                     
     Last year, the Twentieth Legislature, Second Session, passed                                                               
     Senate CS for CS for House Bill No. 404(RLS).  This bill                                                                   
     raised temporary registration fees for out-of-state trucks to                                                              
     fund size, weight and safety inspections statewide.  This bill                                                             
     eliminated the requirement of annual registration of                                                                       
     commercial trailers with the Division of Motor Vehicles (DMV),                                                             
     saving the state $100,000 by eliminating 20,000 yearly                                                                     
     transactions.  It also saved trucking companies the chore of                                                               
     hunting down hundreds of trailers statewide, on barges, or                                                                 
     even out of state, to affix registration stickers.                                                                         
     The House version raised fees on commercial trucks to offset                                                               
     the revenue lost to the state from registering trailers.                                                                   
     However, in the final days of passage, bill critics noted that                                                             
     some municipalities lost tax revenues by eliminating trailer                                                               
     registrations. (The DMV collects taxes for some municipalities                                                             
     when it registers vehicles.)                                                                                               
     The bill was amended to include a 'sunset' date of March 30,                                                               
     1999.  This 'sunset' was to allow the trucking industry,                                                                   
     municipalities, and DMV time to agree on a plan to replace the                                                             
     lost revenues or go back to yearly registration of trailers.                                                               
     After several recent teleconferences and meetings, the                                                                     
     affected parties reached certain agreements.  HB 73 meets                                                                  
     these agreements by:                                                                                                       
     *    Making permanent the new registration fees for commercial                                                             
     *    Raising the municipal tax schedule by $75 per year on                                                                 
          trucks over 12,000 pounds to restore lost revenue to                                                                  
          affected municipalities.                                                                                              
     *    Tightening the 'situs' language so that trucks are                                                                    
          registered for where they are normally used.                                                                          
Number 0345                                                                                                                     
FRANK DILLON, Executive Vice President, Alaska Trucking                                                                         
Association, testified via teleconference from Anchorage in support                                                             
of HB 73.  He agreed that HB 73 is basically a corrective bill for                                                              
actions taken under HB 404 last session.  He emphasized how                                                                     
important this is to the trucking industry in Alaska, in that last                                                              
year was one of the best the industry has had in a decade.  He                                                                  
added, however, that the prospects for the rest of this year and                                                                
next year are a little bit less optimistic.  He further stated that                                                             
many trucking companies do the majority of their work in oil field                                                              
servicing.  As a result of fiscal problems related to the price of                                                              
oil, he explained, these companies are looking at the loss of                                                                   
millions of dollars in contracts that they had thought were secure.                                                             
MR. DILLON reported having met numerous times over the last six                                                                 
months with representatives from the major municipalities that                                                                  
collect this tax, and he stressed that their industry has worked                                                                
very hard to accommodate them.  It was the intention of HB 404, he                                                              
added, to be a revenue-neutral piece of legislation, and it was                                                                 
purely an oversight on the part of all parties involved that the                                                                
municipalities were not involved earlier.                                                                                       
MR. DILLON further explained that it was agreed upon several weeks                                                              
ago that increasing the fee on the allowable portion for municipal                                                              
taxes by $75 on the two heaviest weight classes of vehicles would                                                               
replace the potential loss of revenue from commercial vehicle                                                                   
trailers that would no longer be on their tax rolls.  He emphasized                                                             
that the short-term efficiencies for government, the 20,000                                                                     
transactions that the industry does not have to go through, and the                                                             
trailers that do not have to be located to affix tags to, would all                                                             
be compelling reasons to pass HB 73.  He declared that this bill                                                                
had the support of "the Municipal League, the people who would be                                                               
collecting taxes, the state government, the Division of Motor                                                                   
Vehicles and the Teamsters."  He clarified that, despite the                                                                    
voluminous size of HB 73, the only real change in this bill from HB
404 would be the allowance of an increase of $75 in the 12,000-                                                                 
pound-and-up class of vehicles for municipal tax purposes.                                                                      
Number 0628                                                                                                                     
REPRESENTATIVE HALCRO noted that the increased registration fees                                                                
were intended to apply towards weight and safety inspections.  He                                                               
wondered how effective the state of Alaska has been in utilizing                                                                
collected fees as intended for a safety program.                                                                                
MR. DILLON responded, "Unfortunately, there is no direct linkage                                                                
between the fees that we pay in motor vehicle licensing and our                                                                 
safety inspection program and our measurement standards weighing                                                                
program."  It was his opinion that both of these programs are                                                                   
locally underfunded and not doing the job they should.  He                                                                      
clarified that this funding has to be re-appropriated specifically                                                              
from the general fund by the Governor's budget.                                                                                 
Number 0720                                                                                                                     
REPRESENTATIVE COWDERY asked if this bill was identical to the one                                                              
last year, with the exception of the addition to accommodate the                                                                
MR. DILLON said yes.                                                                                                            
Number 0779                                                                                                                     
CHARLES R. HOSACK, Deputy Director, Division of Motor Vehicles                                                                  
(DMV), Department of Administration, testified via teleconference                                                               
from Anchorage on behalf of the DMV in support of HB 73.  He agreed                                                             
that HB 73 benefits the DMV, as well as businesses. The DMV has                                                                 
been charging these fees since January 1, 1999, he added, and they                                                              
are issuing permanent plates to trailers.  He stressed that passage                                                             
of this bill would allow continuation of this program.  He                                                                      
confirmed the earlier belief that HB 73 was fully supported by the                                                              
municipalities involved.                                                                                                        
Number 0868                                                                                                                     
JUANITA HENSLEY, Administrator, Division of Motor Vehicles (DMV),                                                               
Department of Administration, State of Alaska, testified via                                                                    
teleconference from Texas on behalf of the DMV in support of HB 73.                                                             
She confirmed that it was simply an oversight that HB 404 did not                                                               
address the 13 communities around the state that the DMV collects                                                               
taxes for, and she reported that they have been working with these                                                              
various municipalities since then to rectify the situation.  It was                                                             
never their intention, she added, to have these communities lose                                                                
money due to this simple oversight.                                                                                             
MS. HENSLEY stated, "Any time you start dealing with Title 28 in                                                                
the Alaska motor vehicle laws, if you change one small section in                                                               
there, there is a whole triage of other sections that also need                                                                 
changing."  She explained that HB 73 would not change the fee                                                                   
structure from what the DMV is already doing today, other than the                                                              
fact that they would be collecting additional taxes on those two                                                                
larger sets of trucks.                                                                                                          
Number 1009                                                                                                                     
REPRESENTATIVE COWDERY asked whether the plates would be                                                                        
transferable from one vehicle to another.                                                                                       
MS. HENSLEY said no, and added that they belong to the trailer and                                                              
would stay there.                                                                                                               
REPRESENTATIVE COWDERY questioned if rural Alaska would be exempt                                                               
from this if HB 73 were to become law.                                                                                          
MS. HENSLEY confirmed that the list of communities that are                                                                     
currently exempt would remain exempt under this bill.                                                                           
REPRESENTATIVE COWDERY sought clarification as to how a community                                                               
achieved this exempt status.                                                                                                    
MS. HENSLEY explained that this was granted if a community had an                                                               
average of less than 499 vehicles daily on a particular roadway.                                                                
REPRESENTATIVE COWDERY wondered whether this was true even if the                                                               
state of Alaska was maintaining the roads.                                                                                      
MS. HENSLEY said yes, as long as the road was not connected to a                                                                
highway system that had greater than 499 vehicles daily on it.                                                                  
Number 1115                                                                                                                     
PETER BLANAS, Member, Teamsters Union Local 959, Anchorage,                                                                     
testified via teleconference in support of HB 73.  He emphasized                                                                
that HB 73 would benefit the transportation sector in many ways,                                                                
not the least of which would be no longer having to chase down and                                                              
apply decals to trailers which may be scattered, literally, across                                                              
the country.  He agreed that this would represent a cost-cutting                                                                
measure for both the DMV and the transportation industry.  He added                                                             
that the additional collection of fees to satisfy local tax                                                                     
impositions would be an adequate "fix" to any foreseeable problem.                                                              
Number 1170                                                                                                                     
BARBARA HUFF TUCKNESS, Director of Legislative and Governmental                                                                 
Affairs, Teamsters Union Local 959, Anchorage, appeared before the                                                              
committee on behalf of her union to go on record in support of HB
73.  She referred the committee to the letter submitted by Gerald                                                               
L. Hood, Secretary-Treasurer of General Teamsters Local 959, State                                                              
of Alaska, as further proof of this support.  While addressing                                                                  
issues of safety, adoption of federal regulations into state law,                                                               
and registration issues, she explained, some of the municipal taxes                                                             
being collected were inadvertently overlooked.  She endorsed HB 73                                                              
as a solution to this problem.                                                                                                  
Number 1230                                                                                                                     
REPRESENTATIVE HALCRO sought clarification concerning the process                                                               
involved with registering out-of-state trailers entering the                                                                    
Municipality of Anchorage.                                                                                                      
MS. HUFF TUCKNESS indicated she believed that these individual                                                                  
companies had employees who register these trucks as part of their                                                              
job, and added that it usually takes about three to four months of                                                              
each year to tag these trailers and make sure they have appropriate                                                             
registration.  The trucks are registered, she explained, at the                                                                 
location they are being utilized in.                                                                                            
Number 1324                                                                                                                     
MR. DILLON added to his previous testimony. He stated that the goal                                                             
was to expedite HB 73, as it has a March 30, 1999, deadline to                                                                  
Number 1366                                                                                                                     
REPRESENTATIVE COWDERY made a motion that HB 73 move from the                                                                   
committee with individual recommendations and a zero fiscal note.                                                               
There being no objection, HB 73 was moved out of the House                                                                      
Transportation Standing Committee.                                                                                              

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