04/28/1993 09:05 AM Senate CRA

  The Senate Community & Regional Affairs Committee was called                 
  to order  by Senator Randy Phillips, Chairman,  at 9:05 a.m.                 
  He introduced HB 253 (FISHERIES BUSINESS TAXES) as the first                 
  order of business.                                                           
                                                                               
  Number 010                                                                   
                                                                               
                                                                               
  REPRESENTATIVE MIKE NAVARRE, representing  the House Finance                 
  Committee, explained the legislation takes five  percent off                 
  the  top   of  the   shared  fisheries   business  tax   for                 
  administrative  costs.   It  is  recognition that  there are                 
  administrative costs that go along with some of the programs                 
  administered by the  state.  After the  administrative costs                 
  are  taken  off, whatever  is  left  is shared  back  to the                 
  municipalities.                                                              
                                                                               
  Number 033                                                                   
                                                                               
  SENATOR ZHAROFF asked how much  money is collected from  the                 
  raw fish tax.   REPRESENTATIVE  NAVARRE responded that  last                 
  year it was approximately $30 million.  SENATOR ZHAROFF said                 
  of  that  $30 million,  $15 million  should  go back  to the                 
  municipalities, but it doesn't work that  way.  It only goes                 
  back  to  those  areas  that  can  identify  that they  have                 
  processing taking place within that area.  He concluded that                 
  the state already receives in excess of 5 percent of the $30                 
  million that  goes into  the general  fund.   REPRESENTATIVE                 
  NAVARRE agreed that was true  until the statute was  changed                 
  last year.   Under  the change,  that money  that is  caught                 
  outside  of  those  areas   will  now  be  shared  back   to                 
  communities that can show  an impact, even if it  wasn't the                 
  area that  the tax  was collected in.   That  cost was  $1.5                 
  million to the general fund this year.                                       
                                                                               
  SENATOR  ZHAROFF  said  some  municipalities have  suggested                 
  giving the  municipalities authorization for  collecting the                 
  entire raw fish  tax and  then reimburse them  for their  50                 
  percent, minus administrative costs.  REPRESENTATIVE NAVARRE                 
  said if all  of the communities that  share in the  raw fish                 
  tax had the ability to do that it might work, but  he thinks                 
  it  is  far more  efficient to  do it  this way  because the                 
  administrative costs that  would be  encumbered by doing  it                 
  that way  would be  far more than  the 2.5  percent cost  to                 
  municipalities under this legislation.                                       
                                                                               
  Number 168                                                                   
                                                                               
  SENATOR ZHAROFF suggested  that the committee  should pursue                 
  the option of allowing the collection of the raw fish tax by                 
  municipalities   that   have    that   capability.       The                 
  municipalities would  then get  their money  right up  front                 
  instead of having  to wait  a year to  have it  appropriated                 
  back to them by the legislature.                                             
                                                                               
  Number 200                                                                   
                                                                               
  After further discussion, it was agreed  to hold HB 253 over                 
  for one day so that members could take a closer look at it.