Legislature(1995 - 1996)
04/27/1995 04:10 PM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SSTA - 4/27/95 Number 368 SB 118 TAX CREDIT: GIFTS TO PUBLIC BROADCASTING SENATOR SHARP brings up SB 118 as the next order of business before the Senate State Affairs Committee and calls the first witness. Number 373 SENATOR TORGERSON, prime sponsor of SB 118, informs the committee that SB 118 is an attempt to plug some of the gaps in funding for public broadcasting that were created by budget cuts. The original intent of the bill was to allow up to a $100,000 tax credit. It is his intent to create a true public-private partnership in the face of declining revenue. Senator Torgerson understands there might be a motion to adopt the house version of this legislation, which is quite different from SB 118. Number 390 SENATOR LEMAN states he has not seen a proposed committee substitute. CHAIRMAN SHARP does not have one either. SENATOR LEMAN comments that SB 118 seems to be reasonably consistent with existing tax credits. But if it [the house version?] is substantially different, he would want to give it careful scrutiny. SENATOR TORGERSON states it [the house version?] will increase the amount available for a tax credit to $350,000, and includes other categories. It also has a sunset at five years. SENATOR LEMAN asks if it [the house version?] keeps the credit at 50% of the amount given. SENATOR TORGERSON replies he would have to defer to his staff on that question. Number 427 BOB BARTHOLOMEW, Deputy Director of the Income & Excise Audit Division, Department of Revenue, informs the committee that there is currently in statute a provision for taking a tax credit for contributions to postsecondary educational institutions. This bill would expand that credit to cover public broadcasting contributions. The estimated fiscal impact of SB 118 is about $845,000. This figure is included in the department's fiscal note. CHAIRMAN SHARP asks what amount was taken for education credits last year. MR. BARTHOLOMEW responds that $944,000 in education tax credits were taken last year. SENATOR RANDY PHILLIPS asks Ms. Kaplan to convey her concerns to the committee. Number 460 DIANE KAPLAN, KOAHNIC Broadcasting Corporation, states the purpose of SB 118 is to encourage increased private contributions from corporations in Alaska. The goal is to begin an endowment fund to begin to replace some of the state funding that has been lost over the last ten years, and to preserve essential services throughout the state. The house version of the bill that was adopted originally had a $500,000 cap, with no sunset date. The committee substitute that was reported from the House Finance Committee places a $350,000 maximum on tax credits, with a five-year sunset provision. It also includes the fish-landing tax as one of the eligible taxes. We consider this to be the most important piece of legislation for public broadcasting this year: in addition to encouraging new private contributions, it also increases the ability of corporations to donate to higher education. Ms. Kaplan hopes that the Senate State Affairs Committee will adopt a senate committee substitute that matches the house version of the bill. She thinks it is important that public broadcasting and higher education not be put in competition for the same level of contributions. Number 483 SENATOR LEMAN asks, why not allow for donations to primary and secondary education, in addition to donations for postsecondary education? Number 499 SENATOR RANDY PHILLIPS comments he would like to keep the bill moving, and asks if a committee substitute can be presented when the bill is in the Finance Committee. CHAIRMAN SHARP adds that he would be more comfortable moving the original bill, than something he hasn't seen. Number 510 SENATOR LEMAN states he is not on the Finance Committee, and he thinks the committee should consider expanding SB 118 to include contributions towards primary and secondary education. CHAIRMAN SHARP notes that any diversion from the general fund is a dilution of funds available for appropriation. Number 545 SENATOR LEMAN states he intends to offer an amendment to include K- 12 education in the state. SENATOR RANDY PHILLIPS asks if that would be constitutional, especially if the money was contributed to a private, religious school. SENATOR LEMAN responds that it's not unconstitutional to make tax- deductible contributions to a church. SENATOR TORGERSON adds that Senator Leman's suggestion would also require a title change. Number 563 CHAIRMAN SHARP states he would just as soon hold the bill over to work on those suggestions, if it is the desire of the committee to make such substantial changes to the bill. Number 567 MS. KAPLAN expresses concern that if too many items, or even any other beneficiaries are added to SB 118, it would so dilute the amount of money that would go to any one entity, that it would not make a meaningful difference. She also thinks adding on other items would make it harder to pass the bill. Number 580 SENATOR LEMAN expresses disagreement with Ms. Kaplan's previous statement. CHAIRMAN SHARP states the committee will hear SB 118 again, as soon as the committee substitute for the bill is prepared.