04/16/1993 10:05 AM Senate CRA

  SENATOR RANDY PHILLIPS brought  SB 176 (MUNICIPAL  INVENTORY                 
  TAX EXEMPTION:EXPORTS) before the committee.                                 
                                                                               
  SCOTT   HAWKINS,  President   of   the  Anchorage   Economic                 
  Development  Corporation,  said  there is  some  urgency  to                 
                                                                               
                                                                               
  getting SB  176 passed,  because without it,  municipalities                 
  are forced to  levy property  taxes even on  goods held  for                 
  shipment outside of the state.  That hasn't been an issue in                 
  the  past   because  of   the  lack   of  an   international                 
  distribution industry in Anchorage.                                          
                                                                               
  SB 176 will give  localities the option of  classifying that                 
  kind of an inventory and setting it outside of the inventory                 
  tax.    He  added  that  if  on the  following  Tuesday  the                 
  Municipality of Anchorage votes  in a sales tax, the  way it                 
  is  structured it  actually  eliminates the  inventory  tax.                 
  However, Mr. Hawkins still urged going forward with the bill                 
  because there  are other communities in the  state that will                 
  benefit  from the  bill,  and  the  chances  of  the  ballot                 
  proposition passing in Anchorage are not real high.                          
                                                                               
  Mr. Hawkins pointed out  that there is no inventory  that is                 
  currently being taxed  because they have yet to  attract the                 
  international distribution  industry, so there would  not be                 
  any fiscal impact that  they are aware of.   This will allow                 
  the municipality to  attract this  industry, and the  actual                 
  long-term fiscal impact  would be positive because  it would                 
  be necessary to build warehouses, etc.                                       
                                                                               
  Number 408                                                                   
                                                                               
  SENATOR  ZHAROFF  asked  if the  Department  of  Community &                 
  Regional Affairs  has a  position was  on SB  176.   SHIRLEY                 
  ARMSTRONG,  staff  to  the committee,  responded  that their                 
  position paper is neutral and that they have provided a zero                 
  fiscal note.                                                                 
                                                                               
  Number 417                                                                   
                                                                               
  SENATOR RANDY  PHILLIPS said  he was  concerned because  the                 
  legislation was taking  out the  language that an  ordinance                 
  like  this  may not  be  repealed  by the  voters  through a                 
  referendum,  and  he thinks  that  language should  stay in.                 
  SCOTT HAWKINS answered that it  was cleanup of the  language                 
  and  was  considered  superfluous.    Any ordinance  can  be                 
  repealed  by the  voters by  referendum.  He  also clarified                 
  that this  legislation would  have no  direct affect  on the                 
  public school  foundation formula  or the  dollars that  the                 
  district would receive from the state through the foundation                 
  program.  He  said if  anything, it will  actually help  the                 
  Municipality of Anchorage  raise tax  revenue and help  fund                 
  the school district budget.                                                  
                                                                               
  Number 485                                                                   
                                                                               
  DUANE GUILEY,  Director  of School  Finance,  Department  of                 
  Education,  also  clarified  that in  that  this  section is                 
  included under optional  exemptions for  local tax in  state                 
  statute (AS 29.45.050), it has absolutely no affect on local                 
                                                                               
                                                                               
  contribution rates in public school  districts in the state.                 
  Only mandated exemptions are excluded from the value of full                 
  and true determination for real and personal property.                       
                                                                               
  Number 500                                                                   
                                                                               
  SENATOR  RANDY  PHILLIPS  asked  for  the  pleasure  of  the                 
  committee.                                                                   
                                                                               
  SENATOR LEMAN moved  that SB 176  be moved out of  committee                 
  with individual recommendations.    Hearing no objection, it                 
  was so ordered.