Legislature(2023 - 2024)BARNES 124
04/27/2023 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB133 | |
| HB134 | |
| HB153 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 133 | TELECONFERENCED | |
| += | HB 134 | TELECONFERENCED | |
| *+ | HB 153 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
ALASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
April 27, 2023
8:04 a.m.
MEMBERS PRESENT
Representative CJ McCormick, Chair
Representative Kevin McCabe, Vice Chair
Representative Tom McKay
Representative Justin Ruffridge
Representative Rebecca Himschoot
Representative Donna Mears
MEMBERS ABSENT
Representative Josiah Patkotak
OTHER LEGISLATORS PRESENT
Representative Louise Stutes
COMMITTEE CALENDAR
HOUSE BILL NO. 133
"An Act exempting municipal service area boards from the
requirements of the Open Meetings Act; and providing for an
effective date."
- HEARD & HELD
HOUSE BILL NO. 134
"An Act prohibiting municipalities from levying a tax on the
transfer of real property; prohibiting the state from levying a
tax on the transfer of real property; and relating to municipal
taxation of mobile telecommunications services."
- HEARD & HELD
HOUSE BILL NO. 153
"An Act relating to oil and gas exploration, production, and
pipeline transportation property taxes; and providing for an
effective date."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 133
SHORT TITLE: MUNICIPAL SERVICE AREA BOARD MEETINGS
SPONSOR(s): REPRESENTATIVE(s) SUMNER
03/27/23 (H) READ THE FIRST TIME - REFERRALS
03/27/23 (H) CRA, STA
04/27/23 (H) CRA AT 8:00 AM BARNES 124
BILL: HB 134
SHORT TITLE: PROPERTY TRANSFER TAX; MUNI TELECOMM TAX
SPONSOR(s): REPRESENTATIVE(s) COULOMBE
03/27/23 (H) READ THE FIRST TIME - REFERRALS
03/27/23 (H) CRA
04/13/23 (H) CRA AT 8:00 AM BARNES 124
04/13/23 (H) Heard & Held
04/13/23 (H) MINUTE(CRA)
04/27/23 (H) CRA AT 8:00 AM BARNES 124
BILL: HB 153
SHORT TITLE: OIL AND GAS PROPERTY TAX
SPONSOR(s): REPRESENTATIVE(s) GROH
04/05/23 (H) READ THE FIRST TIME - REFERRALS
04/05/23 (H) CRA, RES
04/27/23 (H) CRA AT 8:00 AM BARNES 124
WITNESS REGISTER
REPRESENTATIVE JESSE SUMNER
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 133.
STEVE MENARD, Chief of Staff
Representative Jesse Sumner
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Gave the sectional analysis for HB 133 on
behalf of Representative Sumner, prime sponsor.
JILL PARSON
Big Lake Road Service Area
Big Lake, Alaska
POSITION STATEMENT: Gave invited testimony during the hearing
on HB 133.
MOKIE TEW
Matanuska-Susitna Valley, Alaska
POSITION STATEMENT: Gave invited testimony during the hearing
on HB 133.
REPRESENTATIVE JULIE COULOMBE
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 134.
RYLEH BODYSELT
Fairbanks, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
BARBARA ANGAIAK
Homer, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
MARK MASLEY
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
LARRY BURKE
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
CALLIE BACON
Seward Properties
Seward, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
TERRY BRYAN
Fairbanks, Alaska
POSITION STATEMENT: Gave invited testimony in support of HB
134.
NILS ANDREASSEN
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on HB 134.
TONJA MOSER, representing self
Juneau, Alaska
POSITION STATEMENT: Testified in support of HB 134.
REPRESENTATIVE CLIFF GROH
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented HB 153.
CAMERON EBERSOLD, Staff
Representative Cliff Groh
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Gave the sectional analysis for HB 153 on
behalf or Representative Groh, prime sponsor.
COLLEEN GLOVER, Director
Division of Tax
Department of Revenue
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
153.
ACTION NARRATIVE
8:04:00 AM
CHAIR CJ MCCORMICK called the House Community and Regional
Affairs Standing Committee meeting to order at 8:04 a.m.
Representatives McKay, Ruffridge, Himschoot, Mears, McCabe, and
McCormick were present at the call to order. Also present was
Representative Louise Stutes.
HB 133-MUNICIPAL SERVICE AREA BOARD MEETINGS
8:05:45 AM
CHAIR MCCORMICK announced that the first order of business would
be HOUSE BILL NO. 133, "An Act exempting municipal service area
boards from the requirements of the Open Meetings Act; and
providing for an effective date."
8:06:05 AM
REPRESENTATIVE JESSE SUMNER, Alaska State Legislature, as prime
sponsor, presented HB 133. He read the sponsor statement
[included in the committee packet], which read as follows
[original punctuation provided]:
House Bill 133 would give specific exemptions to local
municipalities on the Open Meetings Act.
Currently, the Open Meetings Act (OMA) doesn't allow
for Board Supervisors on the Road, Safety and
Assessment (RSA) board to ride in the same vehicle,
because of the quorum statute in OMA. For example, in
the Mat-Su Borough, RSA is an advisory only position
appointed by the Mayor. These positions are strictly
voluntary; with no power to contract or spend any of
the Borough's money.
Not only would this change incentivize local board
members; which has been a problem filling, but in the
Mat-Su Valley, it is critical to get all the
Supervisors together and brainstorm on how best to
solve Borough issues, without the cloud of the OMA.
Currently, in practice, if a board member found out
something wrong with a road, he or she does not have
the ability to call others on the board to come look
at said problem and discuss solutions on solving the
issue, because of the Open Meetings Act. This is a big
problem for local municipalities with an easy solution
set forth in this bill.
Please join us in supporting HB 133.
8:07:41 AM
STEVE MENARD, Chief of Staff, Representative Jesse Sumner,
Alaska State Legislature, gave the sectional analysis for HB
133, on behalf of Representative Sumner, prime sponsor, which
read as follows [original punctuation provided]:
Section I:
Just a small grammatical amendment AS 44.62.310(d)(5)
from UPON to ON.
And
Removes a portion of AS 44.62.310(d)(8) to ultimately
read "meetings of municipal service area boards
established under AS 29.35.450 29.35.490." This is
the heart of the Bill that will give the power back to
local municipalities to function reasonable in
deciding on how best to problem-solve and not be in
violation of the Open Meetings Act.
Section II:
If passed, this would take effect immediately under AS
01.10.070©.
8:09:18 AM
JILL PARSON, Big Lake Road Service Area, explained she is on the
Road, Safety, and Assessment (RSA) 21 Big Lake Board of
Supervisors, and stated that the board is significantly impacted
by the Open Meetings Act (OMA). While all meetings are open to
the public, that does not work when observing road conditions is
the reason for the meeting and sight visits are often
spontaneous and weather dependent. She noted that board members
end up driving in separate vehicles, so they do not have a
quorum of their five-member board in any one vehicle. If all
five members traveled in one vehicle, they could discuss and
evaluate issues in between stops - a valuable and efficient way
to find solutions to road problems. Members can then be
prepared with alternatives to present to the public at regularly
scheduled monthly meetings in which the public participates.
8:11:27 AM
REPRESENTATIVE MEARS observed that "the work folks do in
infrastructure" is underappreciated, and she stressed the
importance of having site visits. She said she looked forward
to supporting the bill.
8:12:04 AM
REPRESENTATIVE MCCABE offered his understanding that the makers
of the statute assume that any time the board members get
together they will be talking about common interests, and the
ultimate authority for "the spend" comes from the assembly.
8:13:27 AM
REPRESENTATIVE SUMNER replied that it may seem like the
Matanuska-Susitna Borough is taking the Act too seriously, but
it may be the only municipality that has a standing injunction.
8:13:47 AM
REPRESENTATIVE MCCABE confirmed his understanding of the legal
aspect, and said he thought there is some intent to increase the
size of the road service area board in different RSA districts
that currently cannot be increased, due to the restrictions. He
stated he supported the legislation.
8:14:42 AM
REPRESENTATIVE RUFFRIDGE asked for clarification that the
provisions under HB 133 would ensure the service area board
would still have some kind of mechanism to have a say in public
meetings, and he questioned what would prevent the board from
having all its meetings behind closed doors.
8:15:25 AM
REPRESENTATIVE SUMNER replied, "We did bring the bill that way
... as a bare bones approach to this." He said he did not think
it would be problematic for the service area boards to be
excluded from the OMA, although he would consider it a friendly
amendment if the committee were to "put some side rails" on the
legislation.
8:15:52 AM
REPRESENTATIVE SUMNER, in response to a question from
Representative Himschoot regarding board discussion on the road,
said it would be difficult outside of a public meeting to pass a
resolution. It is the assembly that ultimately has the "purse
strings" and is accountable to the public.
8:17:21 AM
MR. MENARD further explained the vital point of the bill is
local authority, the assembly's ability to set the parameters of
when to meet, what to discuss, and when to present to the
public.
8:17:52 AM
REPRESENTATIVE MCCABE asked if the borough code sets the timing
and dates for RSA required meetings.
REPRESENTATIVE SUMNER replied that local government couldn't set
times and dates out in code without the restriction that the OMA
has created.
8:19:19 AM
MOKIE TEW gave invited testimony on HB 133 and informed the
committee he is a Matanuska-Susitna Borough Assembly member. He
explained that the operation of the road superintendent and RSA
supervisor are hindered in regard to responding when the
citizens call about road problems; it is difficult for more than
one assembly member to go out and look at the problem on the
road and then report the problem and possible solution back to
the Mat-Su Borough road superintendent. He stated that the bill
would allow the road supervisors to volunteer people, and when
meetings take place, solutions are formulated and put together.
He stressed that there is no intention of excluding the public
from the meeting. In conclusion, he said that a much stronger
team of people would be built as a result of having a "volunteer
road supervisor."
8:24:14 AM
CHAIR MCCORMICK thanked Mr. Tew for his testimony and invited
questions from the committee.
8:24:25 AM
REPRESENTATIVE MEARS was curious if anyone had reached out to
other areas of the state to find out if there were any similar
issues or questions.
MR. MENARD replied he did not, that this was brought as a
specific issue in the Mat-Su Valley.
8:26:04 AM
REPRESENTATIVE SUMNER expressed his appreciation for being able
to present HB 133.
8:26:13 AM
CHAIR MCCORMICK announced that HB 133 was held over.
8:26:32 AM
The committee took an at-ease from 8:26 a.m. to 8:28 a.m.
HB 134-PROPERTY TRANSFER TAX; MUNI TELECOMM TAX
8:28:15 AM
CHAIR MCCORMICK announced that the next order of business would
be HOUSE BILL NO. 134, "An Act prohibiting municipalities from
levying a tax on the transfer of real property; prohibiting the
state from levying a tax on the transfer of real property; and
relating to municipal taxation of mobile telecommunications
services."
8:28:25 AM
REPRESENTATIVE JULIE COULOMBE, Alaska State Legislature, as
prime sponsor, presented HB 134. She paraphrased the sponsor
statement [included in the committee packet], which read as
follows [original punctuation provided]:
HB 134 prohibits the state and local governments from
imposing real estate transfer taxes, fees, other
assessments on sales, grants, assignments, or transfer
of real property. A transfer fee is an additional cost
that is increasingly being assessed by local and state
governments for property transactions in other states.
Over the last several years we have seen an increase
in tax rates across America. By increasing the cost of
purchasing a home, higher transfer taxes have a ripple
effect on this pattern of homeownership. Those seeking
to be first-time homeowners face great upfront costs
to purchase a home, thereby reducing the potential
number of first-time homebuyers. Families seeking to
purchase larger homes may find it difficult to sell
their homes and/or find a home. This impact extends to
seniors, who are retired and on fixed incomes and are
dependent on selling their homes home to help finance
their retirement. In short, transfer tax increases
disrupt a lifecycle model of housing, whereby
households adjust their housing as their needs change.
HB 134 will aid not only homebuyers and sellers, but
existing real estate laws overall in Alaska. It
reassures the state will not enact additional charges
to real estate property purchases which would increase
affordability for the housing market and raise real
estate economy.
I respectfully request the support of my colleagues on
HB 134.
8:30:14 AM
CHAIR MCCORMICK welcomed invited testifiers.
8:30:40 AM
RYLEH BODYSELT gave invited testimony in support of HB 134. She
began by mentioning Alaska's several military bases, and that
military personnel often face challenges when it comes to
finding housing. She stated some of the most "gut wrenching"
experiences in her career had been helping clients that are not
able to find affordable housing. She opined that HB 134 is
needed, as the bill would help fight to keep housing affordable
in Alaska.
8:33:19 AM
REPRESENTATIVE HIMSCHOOT offered her understanding that military
families have programs or federal assistance that help them with
buying and selling homes due to the transient nature of serving
in the military.
8:33:52 AM
MS. BODYSELT confirmed there are programs to help buy and sell
homes - most commonly being VA loans - but military personnel
must be able to afford it.
8:34:24 AM
BARBARA ANGAIAK gave invited testimony in support of HB 134, and
she stated the cost of living in Alaska is already high, and
affordable housing is a huge factor for families as well as the
ability to attract and retain employees in all sectors. Added
fees on top of already high prices cause even more problems, she
concluded.
8:37:46 AM
MARK MASLEY gave invited testimony in support of HB 134, and
expressed his belief that the bill is critical for the future of
home ownership in Alaska. As other testifiers have noted, he
acknowledged that Alaska is facing an affordable housing crisis.
The potential for a transfer tax could harm current and future
homeowners, in particular first-time buyers, who are already
facing rising interest rates, property taxes, and significant
financial challenges that affect their ability to purchase a
home. Senior citizens on fixed incomes, he explained, could
also be significantly impacted by a transfer tax. He urged the
committee to support HB 134 and thanked them for their time.
8:40:29 AM
LARRY BURKE gave invited testimony in support of HB 134. He
explained that the transfer tax is separate from recorded
mortgage taxes; the transfer tax is not tax deductible on
federal taxes. He stressed his support for moving HB 134 out of
committee.
8:42:23 AM
CALLIE BACON, Seward Properties, gave invited testimony in
support of HB 134. She stated that a transfer tax on the sale
of real estate would be harmful to the residents of rural
Alaska, and she noted 45 percent of all buyer clients served in
2022 were first-time buyers, and affordability is already a
challenge. People in rural communities such as Seward, she
explained, cannot afford a real estate transfer tax. She
stressed her opposition to the transfer tax and her support for
the passage of HB 134 that it may be heard by the full body.
8:44:33 AM
TERRY BRYAN gave invited testimony in support of HB 134 and
provided a brief background of his time in title insurance. He
said that although title companies would not be directly
impacted by the implementation of transfer fees, he is still in
support of HB 134. Adding any additional expense to home
ownership would force many first-time home buyers out of the
market. Being the real estate industry is a key economic force
in the state of Alaska, the legislature should look at ways to
support and ensure the state's growth, not to impede or handicap
the path to homeownership. He stated he personally and
professionally supports HB 134.
8:48:04 AM
CHAIR MCCORMICK opened public testimony on HB 134.
8:48:14 AM
NILS ANDREASSEN, Alaska Municipal League, gave testimony during
the hearing of HB 134. He stated not being sure if the bill
addresses housing costs in Alaska, and the lack of definition
within the bill does not help clarify what a transfer is applied
to and would require a definition of "transfer" to be
applicable. He highlighted a specific concern about the
ambiguity of the bill and its effect on local government, and
its intent to address the housing crisis Alaska is facing. He
encouraged the committee to spend time on the housing crisis, as
well as the many other costs involved in housing consideration.
8:51:11 AM
TONJA MOSER, representing self, testified in support of HB 134.
She noted her disagreement with the last testifier, but said she
understood his intent. She stated her concern is that adding
another tax to an already expensive transaction would make
housing more unaffordable than it already is. She urged the
committee to work towards positive solutions for affordable
housing.
8:52:43 AM
CHAIR MCCORMICK, after ascertaining there was no one else who
wished to testify, closed public testimony on HB 134.
8:52:56 AM
REPRESENTATIVE COULOMBE thanked the committee for hearing the
bill, and to the testifier referencing definitions, she
confirmed that there are statutory definitions for transferring
real property that can be given to the committee.
8:53:36 AM
CHAIR MCCORMICK announced that HB 134 was held over.
8:53:44 AM
The committee took an at-ease from 8:53 a.m. to 8:55 a.m.
HB 153-OIL AND GAS PROPERTY TAX
8:55:13 AM
CHAIR MCCORMICK announced that the final order of business would
be HOUSE BILL NO. 153, "An Act relating to oil and gas
exploration, production, and pipeline transportation property
taxes; and providing for an effective date."
8:55:27 AM
REPRESENTATIVE CLIFF GROH, Alaska State Legislature, as prime
sponsor of HB 153, paraphrased the sponsor statement [included
in the committee packet], which read as follows [original
punctuation provided]:
Alaska's reliance on savings accounts to fill budget
deficits is no longer sustainable without risking the
future of the Permanent Fund. We need new revenues,
and changing the oil and property tax is one way to
raise new revenues in a predictable fashion.
This bill proposes to increase the maximum mill rate
from 20 mills (2%) to 30 mills (3%) on the full and
true value of oil and gas property assessed under
Alaska Statute 43.56. Currently, the total mill rate
is capped at 20 mills, and municipalities may collect
taxes up to that amount. The State retains the
property tax not otherwise collected by
municipalities, so the State's collections fall each
time a municipality raises its property tax rate.
Under this bill, the maximum municipal rate would
remain at 20 mills leaving local communities harmless,
but the State would tax an additional 10 mills that
would generate revenue reserved for the State.
HB 153 offers a fixed and predictable cost for the oil
and gas industry. The petroleum property tax has not
been raised since its establishment in 1973, and the
proposed increase in the mill rate will offer a
reliable source of revenue for the State.
Depending on the price of oil, the property tax
increase would be offset by existing oil production
taxes and royalties. Given that offset the state would
net up to approximately $250 million in new revenue
under this bill each year.
HB 153 suggests three tiers of designated
appropriation, while not dedicating the funds:
• 50% to the capital income fund to help pay down
the deferred maintenance backlog;
• 25% to the Department of Education and Early
Development for investments in early education,
including pre-K, childcare and early development; and
• 25% to higher education investment to enhance
the merit-based Alaska performance scholarship and
needs-based Alaska education.
HB 153 bill increases an existing, predictable revenue
source to improve Alaska's quality of life and build
opportunities for future generations. Thank you for
your consideration.
8:57:49 AM
CAMERON EBERSOLD, Staff, Representative Cliff Groh, Alaska State
Legislature, on behalf of Representative Groh, prime sponsor,
gave the sectional analysis for HB 153 [included in the
committee packet], which read as follows [original punctuation
provided]:
Section 1: Amends AS 43.56.010(a) to include a new
subsection (2) that increases the maximum mill rate an
additional 10 mills. This only applies to taxable
property as defined under AS 43.56.210.
Section 2: Amends AS 43.56.010(d) with conforming
language. This clarifies the municipal property tax
under (a)(1) of the bill can only be credited to the
taxpayer.
Section 3: The estimated balance of the taxes
collected in section one of this bill may be
appropriated by the legislature as follows:
1. 50% to the Alaska Capital Income Fund;
2. 25% to Department of Education and Early
Development for early childhood education
programs, including pre-elementary programs,
childcare, and educational programs; and
3. 25% to the Alaska higher education investment
fund.
Section 4: Establishes an effective date of January
1st, 2024.
8:59:07 AM
REPRESENTATIVE MCCABE asked whether a dedicated fund would be
established that may not be constitutional. He paraphrased a
section in the fiscal note, which read as follows:
For purposes of this fiscal note, the property tax
revenue increase is shown as Designated General Fund
but this bill directs the legislature to appropriate
revenue as follows: (1) 50% into the Alaskan Capital
Income Fund, (2) 25% to Department of Education and
Early Development for specified programs, and (3) 25%
into the Alaskan Higher Education Fund. While the bill
directs the aforementioned distribution, the revenues
are technically available for appropriation for any
purpose.
REPRESENTATIVE MCCABE stated that, in spirit, it may violate
what the Constitution of the State of Alaska disallows, which is
to earmark monies to go into specific funds.
9:00:05 AM
REPRESENTATIVE GROH replied that Section 3 of the bill read that
"the annual estimate balance of the account may be appropriated
by the legislature"; therefore, it would be consistent with the
constitutional language that is being referenced.
9:00:40 AM
REPRESENTATIVE RUFFRIDGE asked what the effective tax rate would
be by state - particularly in states that have a high amount of
oil and gas production; he noted North Dakota has no property
tax on oil and gas. He asked how Alaska ranked.
REPRESENTATIVE GROH replied there are a mix of taxes that
various states have, and he stated he did not have a precise
ranking. He said he understood there is room to raise revenues
here [in Alaska], and it should be seen in terms of the overall
package of taxes on the oil and gas industry.
REPRESENTATIVE RUFFRIDGE expressed concern over becoming a
competitive disadvantage if Alaska would be at "that highest tax
rate."
9:04:01 AM
REPRESENTATIVE MCKAY agreed with Representative Ruffridge and
said that he thought the concept needed a lot of study. He also
acknowledged the need to look at the constitutionality of
dedicated funds; it could be a big flaw with the bill, as well
as how boroughs where production takes place could be affected.
He reiterated his stance that the proposed legislation needs
significant study for consideration.
9:06:37 AM
REPRESENTATIVE GROH clarified that there would not be an effect
on the property tax revenues, and he stated Mr. Andreassen is
available to address what needs further clarification.
9:07:25 AM
MR. ANDREASSEN stated that as the bill is currently drafted, it
would not change existing law as it relates to local government
collection of property taxes, it would apply to oil and gas
property.
9:07:59 AM
REPRESENTATIVE MCKAY expressed concern about the money that
would be taken out in the private sector from the oil industry
that would otherwise be used to drill new wells and give new
production.
9:08:26 AM
REPRESENTATIVE MCCABE asked for confirmation that the tax has
nothing to do with production; it's simply land/property tax.
REPRESENTATIVE GROH replied that is correct, and he stated Ms.
Glover is available to address the issue further.
9:10:08 AM
COLLEEN GLOVER, Director, Division of Tax, Department of
Revenue, answered questions during the hearing of HB 153. She
said HB 153 is specific only to the oil and gas property tax,
and it has secondary impact on the production tax. She pointed
out the fiscal note shows some negative impact on general funds
because of the production tax. She explained there could also
be some impact on corporate income tax dependent on the
taxpayer. She provided a brief breakdown of percentages
directed towards boroughs that may be affected.
9:13:52 AM
REPRESENTATIVE HIMSCHOOT thanked Representative Groh for the
"creativity in how we may solve this structural deficit
problem." She asked to see the "full package" of how Alaska
taxes the oil industry.
9:14:47 AM
REPRESENTATIVE GROH replied that Ms. Glover can address the
question. He further commented on the various oil and gas
producing states that have suites or packages of taxes, of which
oil and gas property tax may or may not be one.
9:16:16 AM
MS. GLOVER explained that there are a few different taxes that
the state imposes on oil and gas producers: oil and gas
production tax; oil and gas property tax that the state
administers on a statewide level; and corporate income tax for
qualifying entities. She further explained that there are many
details that go behind each program, and she noted a
presentation is done each year and covers all the calculations
regarding "how it all works." She allowed that the department
is not an expert in other states' tax policies but could
research and follow up with information.
9:18:18 AM
REPRESENTATIVE GROH noted that the oil and gas property tax is a
much more stable form of revenue for the state; it has been
growing as a percentage of the oil and gas revenues.
9:19:26 AM
REPRESENTATIVE MCKAY commented that Alaska is unique in that its
reserves are publicly owned. He summarized what oil and gas
properties include, and that the properties are assessed
annually, which is then used to determine existing taxes paid.
He stated his concern the proposed legislation may
disincentivize further activity in the private sector, and he
opined that due to an incomplete bill and fiscal note, there are
open questions that need to be studied to determine whether
there may be unintended consequences of the bill.
9:22:14 AM
REPRESENTATIVE GROH responded that the additional revenues could
revive the structural deficit the state faces. He commented
that another committee could look at the issue that
Representative McKay has raised, but he reiterated that this is
a stable source of revenue.
9:23:31 AM
REPRESENTATIVE MCCABE questioned whether the structural deficit
in the state is a result of the major oil companies having been
driven out of state by "willy nilly" tax procedures and the
state focusing on the oil companies any time there is a fiscal
disturbance. He stated that the oil companies are not a "piggy
bank" or a revenue stream; they are a fixed asset.
9:24:59 AM
REPRESENTATIVE HIMSCHOOT agreed about the bill needing further
study.
9:25:48 AM
REPRESENTATIVE GROH noted that the proposed legislation has a
fixed cost, so it would provide more certainty. He also said
the state needs to look out for itself and its people, and the
proposed legislation would be one stab at confronting the
growing structural deficit.
9:27:55 AM
REPRESENTATIVE MCKAY referred to previous legislation and
commented on the decline and increase of oil production on the
North Slope. He stated his belief that the tax policies are
working now, and HB 153 would disturb that stability greatly.
He stressed the legislature must be very careful about the
taxation of the state's biggest industry.
9:30:03 AM
CHAIR MCCORMICK commented that it is important to be cognizant
of the different elements of the state and what makes up
Alaska's oil tax structure. He said he would like to see a
comparison, but raised concern about the amount of money it
would cost for a study that may turn out to be unnecessary.
CHAIR MCCORMICK announced that HB 153 was held over.
9:31:40 AM
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 9:32 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 133 Open Meeting Act-Sponsor statement.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 133 |
| HB 133 Sectional Analysis.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 133 |
| HB 153 DOR Fiscal Note.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 153 |
| HB 153 Sectional Analysis.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 153 |
| HB 153 Sponsor Statement.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 153 |
| HB 153 Selections from DOR Fall Revenue Source Book.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 153 |
| HB 133 Written Testimony.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 133 |
| HB 134 Written Testimony.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 134 |
| HB 153 Written Testimony.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 153 |
| HB 134 Written Testimony through 1000 4.26.23.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 134 |
| HB 134 Letter of Support Alaska REALTORS.pdf |
HCRA 4/27/2023 8:00:00 AM |
HB 134 |