Legislature(1993 - 1994)
04/29/1993 09:02 AM CRA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
Number 001 The Senate Community & Regional Affairs Committee was called to order by Chairman Randy Phillips at 9:02 a.m. He brought HB 253 (FISHERIES BUSINESS TAXES) before the committee as the only order of business and invited Larry Meyers, Director of Income & Excise Audit, Department of Revenue and Paul Dick, Juneau Operations, Division of Income & Excise Audit, Department of Revenue to join the members at the table. Number 030 LARRY MEYERS addressed some concerns the Department of Revenue has with a proposed amendment to HB 253, which would allow communities to collect the fisheries business tax. He said their purpose in looking at the bill was to try to see if it would fit in with the current existing operations that the department has. They believe those operations have run very smoothly to date; they have been very efficient in collecting the tax. Their concern is not only the potential loss of revenue that might come about as a result of the amendments, but the additional work loads that might be placed on the department and the individual communities. Mr. Meyers requested that a memo outlining the following points of concern be made a part of the record: loss of revenues; additional burden on fisheries businesses; returns still be required by the department; administrative costs higher; enforcement powers diminished; and confusion amongst taxpayers. Mr. Meyers stated that based on information that the department has received from the Governor's office, they would like to go on record in opposition to the proposed amendment. Number 075 SENATOR RANDY PHILLIPS asked Senator Zharoff to explain the proposed amendment. SENATOR ZHAROFF said the amendment relates to the five percent administrative costs. Any negotiations between the commissioner's office and a municipality that shows the willingness and has the capability of handling these functions could share in either that whole 5 percent administrative cost or a portion of it. Senator Zharoff said the Kodiak Island Borough is concerned about further eroding the revenue going to the municipality from the raw fish tax by another 2.5 percent. Number 125 SENATOR ADAMS commented that he has mixed feelings on the amendment, but feels it is a fair amendment. Number 150 PAUL DICK, Juneau Operations Chief, Income & Excise Audit Division, Department of Revenue, said the actual costs of accounting and collecting the monies is substantial, and he believes the department is doing a very efficient job in collecting the taxes and having it as a centralized program. Mr. Dick expressed concern with the concept of communities collecting fisheries business taxes for the state because the processors would be reporting to certain municipalities and not other communities. This would be very confusing for the processors, especially for the floating processors. Number 170 SENATOR ZHAROFF said he thought the logistics could be worked out over a period of time. Number 200 SENATOR ZHAROFF moved the adoption of the following amendment: AMENDMENT #1 Page l, line 1, after "Act": Insert "relating to the administration of fisheries business licenses and the fisheries business tax, and" Page 1, line 4, after "purpose of": Insert "secs. 2 - 4 of" Page 3, line 9: Insert a new bill section to read: "*Sec. 5. AS 43.75 is amended by adding a new section to article 4 to read: Sec. 43.75.280. MUNICIPALITY AS TAX COLLECTION AGENT. (a) If a municipality indicates a willingness to act as the department's agent for purpose of collection of the license fee and tax imposed by this chapter and the commissioner believes the municipality is capable of making and accounting for those collections, the commissioner shall appoint one or more employees of that municipality to assist in the collection of revenue owed under the license fee and tax levied by this chapter. (b) The commissioner may pay for the services of the municipal officials appointed to serve as collection agents under (a) of this section by (1) entering into contingent fee agreements the commissioner considers reasonable; or (2) the payment of amounts out of the proper appropriation for the department the commissioner considers reasonable." Page 3, line 10: Delete "*Sec. 5." and insert "*Sec. 6." Hearing no objection to Amendment No. 1, the Chairman stated the motion had passed and the amendment would be incorporated into a Community & Regional Affairs SCS. Number 210 SENATOR ZHAROFF moved that HB 253 be passed out of committee with individual recommendations. Hearing no objection, it was so ordered. There being no further business to come before the committee, the meeting was adjourned at 9:18 a.m.