Legislature(2019 - 2020)BARNES 124
03/10/2020 01:00 PM House TRANSPORTATION
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| Audio | Topic |
|---|---|
| Start | |
| HB253 | |
| SB115 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 253 | TELECONFERENCED | |
| + | SB 115 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
HOUSE TRANSPORTATION STANDING COMMITTEE
March 10, 2020
1:06 p.m.
MEMBERS PRESENT
Representative Louise Stutes, Chair
Representative Bryce Edgmon
Representative Matt Claman
Representative Harriet Drummond
Representative Andi Story
Representative Mel Gillis
MEMBERS ABSENT
Representative Dave Talerico
COMMITTEE CALENDAR
HOUSE BILL NO. 253
"An Act relating to the powers of the Department of
Transportation and Public Facilities; and relating to the sale,
transfer, or disposal of state ferries."
- MOVED HB 253 OUT OF COMMITTEE
CS FOR SENATE BILL NO. 115(FIN)(EFD FLD)
"An Act relating to vehicle registration fees; and relating to
the motor fuel tax."
- HEARD & HELD
PREVIOUS COMMITTEE ACTION
BILL: HB 253
SHORT TITLE: SALE, TRANSFER, OR DISPOSAL OF FERRIES
SPONSOR(s): REPRESENTATIVE(s) KREISS-TOMKINS
02/17/20 (H) READ THE FIRST TIME - REFERRALS
02/17/20 (H) TRA, STA
02/25/20 (H) TRA AT 1:00 PM BARNES 124
02/25/20 (H) Heard & Held
02/25/20 (H) MINUTE(TRA)
03/03/20 (H) TRA AT 1:00 PM BARNES 124
03/03/20 (H) -- MEETING CANCELED --
03/10/20 (H) TRA AT 1:00 PM BARNES 124
BILL: SB 115
SHORT TITLE: MOTOR FUEL TAX; EV REG FEES
SPONSOR(s): SENATOR(s) BISHOP
04/24/19 (S) READ THE FIRST TIME - REFERRALS
04/24/19 (S) FIN
02/03/20 (S) FIN AT 9:00 AM SENATE FINANCE 532
02/03/20 (S) Heard & Held
02/03/20 (S) MINUTE(FIN)
02/21/20 (S) FIN RPT CS 3DP 1DNP 3NR NEW TITLE
02/21/20 (S) DP: VON IMHOF, HOFFMAN, BISHOP
02/21/20 (S) NR: STEDMAN, WILSON, OLSON
02/21/20 (S) DNP: WIELECHOWSKI
02/21/20 (S) FIN AT 9:00 AM SENATE FINANCE 532
02/21/20 (S) Moved CSSB 115(FIN) Out of Committee
02/21/20 (S) MINUTE(FIN)
03/02/20 (S) TRANSMITTED TO (H)
03/02/20 (S) VERSION: CSSB 115(FIN)(EFD FLD)
03/03/20 (H) READ THE FIRST TIME - REFERRALS
03/03/20 (H) TRA, FIN
03/10/20 (H) TRA AT 1:00 PM BARNES 124
WITNESS REGISTER
SARA PERMAN, Staff
Representative Louise Stutes
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Explained Amendment 1 to HB 253 on behalf
of Representative Stutes, prime sponsor.
MATT MCLAREN, Business Development Manager
Alaska Marine Highway
Juneau, Alaska
POSITION STATEMENT: Provided clarification during the hearing
on HB 253.
ROB CARPENTER, Deputy Commissioner
Department of Transportation and Public Facilities
Juneau, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
253.
JANICE WRENTMORE, Chair
Skagway AdHoc Marine Highway Committee
Skagway, Alaska
POSITION STATEMENT: Testified in support of HB 253.
SENATOR CLICK BISHOP
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: As prime sponsor, presented CSSB
115(FIN)(efd fld).
DARWIN PETERSON, Staff
Senator Click Bishop
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Gave a PowerPoint presentation on CSSB
115(FIN)(efd fld), on behalf of Senator Bishop, prime sponsor.
ROB CARPENTER, Deputy Commissioner
Department of Transportation and Public Facilities
Juneau, Alaska
POSITION STATEMENT: Offered information during the hearing on
CSSB 115(FIN)(efd fld).
DANIEL NICHOLS
American Society of Civil Engineers
Anchorage, Alaska
POSITION STATEMENT: Testified in support of SB 115.
NILS ANDREASSEN, Executive Director
Alaska Municipal League
Juneau, Alaska
POSITION STATEMENT: Testified in support of SB 115.
FRANCIS LEACH, Executive Director
United Fishermen of Alaska
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on SB 115.
ACTION NARRATIVE
1:06:38 PM
CHAIR LOUISE STUTES called the House Transportation Standing
Committee meeting to order at 1:06 p.m. Representatives Claman,
Drummond, Story, and Stutes were present at the call to order.
Representatives Gillis and Edgmon arrived as the meeting was in
progress.
HB 253-SALE, TRANSFER, OR DISPOSAL OF FERRIES
1:07:56 PM
CHAIR STUTES announced that the first order of business would be
HOUSE BILL NO. 253, "An Act relating to the powers of the
Department of Transportation and Public Facilities; and relating
to the sale, transfer, or disposal of state ferries."
1:08:56 PM
CHAIR STUTES opened public testimony on HB 253. After
ascertaining that there was no one who wished to testify, she
closed public testimony.
1:09:24 PM
REPRESENTATIVE DRUMMOND moved to adopt Amendment 1, labeled 31-
LS1541\M.4, Fisher, 3/10/20, which read as follows:
Page 1, following line 7:
Insert a new bill section to read:
"* Sec. 2. AS 19.65.060(a) is amended to read:
(a) There is created, as a special account in
the general fund, the Alaska marine highway system
fund, into which shall be deposited
(1) the gross revenue of the Alaska marine
highway system;
(2) money that is appropriated to the
Alaska marine highway system fund by the legislature
in an amount that is consistent from year to year and
is the amount necessary, after consideration of gross
revenue, to provide stable services to the public
consistent with the provisions of AS 19.65.050(b)(4),
which appropriations are not one-year appropriations
and the balances of which do not lapse under
AS 37.25.010; [AND]
(3) any other money that is appropriated to
the Alaska marine highway system fund by the
legislature, which appropriations are not one-year
appropriations and the balances of which do not lapse
under AS 37.25.010; and
(4) the proceeds from the sale, transfer,
or disposal of a ferry, except for proceeds that are
required to be used for an eligible purpose under 23
U.S.C."
1:09:29 PM
CHAIR STUTES objected, for the purpose of discussion.
1:09:36 PM
REPRESENTATIVE DRUMMOND said Amendment 1 would ensure that any
proceeds from sale, transfer or disposal of ferries would return
funds to the appropriate account.
1:10:08 PM
SARA PERMAN, Staff, Representative Louise Stutes, Alaska State
Legislature, on behalf of Representative Stutes, prime sponsor
of HB 253, explained that Amendment 1 would add a section
stating that any proceeds from the sale, transfer, or disposal
of a ferry - except for those classified in Title 23, Federal
Highway Administration dollars - would be returned to the Alaska
Marine Highway System (AMHS) fund. Vessels built with federal
dollars were not eligible to go straight to AMHS, she explained.
Funds that were not able to be separated could go back to AMHS.
1:11:10 PM
REPRESENTATIVE DRUMMOND presented an example wherein a ferry
that had been built with 90 percent federal funds generated
$200,000, and she asked whether $180,000 would be returned to
the federal fund.
1:11:54 PM
MS. PERMAN responded that the lifetime of a vessel was also a
factor: if a vessel had lived its lifetime there may be a
different calculation in terms of which funds were returned to
the federal fund.
1:14:16 PM
The committee took a brief at-ease at 1:14 p.m.
1:14:51 PM
MATT MCLAREN, Business Development Manager, Alaska Marine
Highway, replied that it was not simply a matter of a ship
having been built with federal funds, but any federal funds used
on the vessel from the date it was built through the current
date, as well as improvements made using federal dollars that
would be factored in, as well as how much money the state had
put into the vessel over the years. Inflation was also a
factor, he said. In terms of the motor vessel (M/V) Taku, 63.9
percent was the federal portion, and 36.1 percent was determined
to go to the state.
1:15:48 PM
REPRESENTATIVE CLAMAN asked whether the AMHS fund was a
designated or a dedicated fund.
1:16:19 PM
ROB CARPENTER, Deputy Commissioner, Department of Transportation
and Public Facilities, replied that funds are designated for
AMHS, not dedicated.
1:16:30 PM
CHAIR STUTES reopened public testimony on HB 253.
1:16:49 PM
JANICE WRENTMORE, Chair, Skagway AdHoc Marine Highway Committee,
testified in support of HB 253. She said she would like to
learn what happens to vessels, and she offered her experience
and understanding that communities that inquire almost never
hear back from AMHS staff. Ms. Wrentmore remarked that AMHS
does not get much from the sale of vessels. She said she thinks
there should be some public scrutiny of the process and
suggested the information could be provided in the form of an
engineer's report, so folks could learn about the vessel's
issues. She then suggested that AMHS offer [retired] vessels to
Alaska communities.
1:19:22 PM
CHAIR STUTES removed her objection to the motion to adopt
Amendment 1. There being no further objection, it was so
ordered.
1:19:52 PM
CHAIR STUTES closed public testimony on HB 253.
1:20:48 PM
The committee took an at-ease from 1:20 p.m. to 1:21 p.m.
1:21:14 PM
REPRESENTATIVE EDGMON moved to report HB 253, as amended, out of
committee with individual recommendations and the accompanying
fiscal notes. There being no objection, CSHB 253(TRA) was
reported out of the House Transportation Standing Committee.
1:21:34 PM
The committee took an at-ease from 1:21 p.m. to 1:22 p.m.
SB 115-MOTOR FUEL TAX; EV REG FEES
1:22:18 PM
CHAIR STUTES announced that the final order of business would be
CS FOR SENATE BILL NO. 115(FIN)(efd fld), "An Act relating to
vehicle registration fees; and relating to the motor fuel tax."
1:23:18 PM
SENATOR CLICK BISHOP, Alaska State Legislature, as prime
sponsor, presented CSSB 115(FIN)(efd fld). He informed the
committee motor fuel tax, which accounted for 6 percent of the
state's budget, had not been raised since 1970. The base excise
rate for motor fuel is still $.08 per gallon, he imparted, and
marine fuel is still $.05 per gallon. After adjusting for
inflation, the motor fuel tax rate of 1970 would be the
equivalent of $.52 today. Alaska fuel tax has lost 82 percent
of its purchasing power since 1970, he said. With the increase,
Alaska would move from fiftieth to forty-first in the nation, he
related. No proposed increases in aviation or jet fuel would be
included in SB 115, he added. The revenue sources book shows
that Alaska is losing between 1 and 2 percent a year in income,
he said.
SENATOR BISHOP related that cars get better fuel mileage today,
about 25 miles per gallon. Electric vehicles (EV) and plug-in
hybrid vehicles increase "wear and tear" but do not add to
revenue, he said, and a good transportation system is necessary
to move goods and commerce. Approximately $33 million in new
revenue would be generated by SB 115 and would move Alaska
forward on deferred road maintenance. Senator Bishop urged the
passage of SB 115 for the purpose of citizens' safety on
Alaska's highways.
1:28:22 PM
The committee took a brief at-ease at 1:28 p.m.
1:28:41 PM
DARWIN PETERSON, Staff, Senator Click Bishop, Alaska State
Legislature, gave a PowerPoint presentation on SB 115 CSSB
115(FIN)(efd fld) [hard copy included in the committee packet],
on behalf of Senator Bishop, prime sponsor. Beginning with
slide 2, Mr. Peterson showed a brief primer on motor fuel tax
history. In 1945, as the slide showed, motor fuel tax was
levied at $.01 per gallon. In 1970, the last increase brought
it to $.08 per gallon. In 1977 and 1994, marine fuel tax and
aviation tax were raised respectively to $.05 and $.047 per
gallon; from September 1, 2008, until August 31, 2009, a fuel
tax "holiday" took place in which motor fuel tax was suspended
on all types; and in 2015, House Bill 158 added a $.0095 per
gallon surcharge on motor fuel intended for spill prevention and
response fund, Mr. Peterson imparted.
1:30:19 PM
REPRESENTATIVE STORY asked why CSSB 115(FIN)(efd fld) would not
include an increase on marine and aviation fuel and how those
types of fuel compared to other states.
1:30:46 PM
MR. PETERSON replied that an increase was proposed for marine
fuel but not jet and aviation fuel. He explained there was a
more competitive advantage in Alaska than in other states for
jet and aviation fuel, currently ranking thirty-sixth and
fortieth, respectively. Cargo flying through Ted Stevens
Anchorage International Airport was quite a benefit to Alaska's
economy, he explained, so the competitive advantage with jet
fuel need not be jeopardized. Money generated by jet and
aviation fuel is required by the Federal Aviation Administration
(FAA) to be spent on airports, so there are federal requirements
if those fuels were to undergo a tax increase.
1:32:38 PM
REPRESENTATIVE DRUMMOND asked whether the FAA would allow
revenue to be spent on state airports or only international
airports.
MR. PETERSON answered that it wasn't restricted to region; money
just needed to be spent on maintenance or upkeep to airports.
1:33:24 PM
REPRESENTATIVE DRUMMOND said it had been proposed to transfer a
couple of rural airports to local communities. She asked Mr.
Peterson how much jet and aviation tax would be directed toward
the smaller airports.
1:33:58 PM
MR. PETERSON replied there was a municipal sharing program in
which revenue was shared with municipalities that owned their
airports, and he estimated 60 percent went to municipalities.
He added this was in statute so could be raised or lowered
according to the will of the legislature.
1:34:33 PM
ROB CARPENTER, Deputy Commissioner, Department of Transportation
and Public Facilities, said the FAA did require that revenue
generated at an airport be spent at that airport. Ted Stevens
Anchorage International Airport and Fairbanks International
Airport were considered a "system," meaning revenue was shared
between those two airports. All the rural airports were a
system as well, so any revenue generated at a rural airport
could be used for any rural airport.
1:35:54 PM
CHAIR STUTES asked how Juneau International Airport was
designated.
MR. CARPENTER replied that Juneau International Airport was
owned by the City & Borough of Juneau (CBJ).
1:36:04 PM
REPRESENTATIVE STORY asked whether there was any more
information about rural airports which would be closing.
1:36:33 PM
MR. CARPENTER replied that there was some information regarding
into which airports DOT&PF was considering divesting, and that
it would be provided to the committee.
1:36:52 PM
MR. PETERSON moved on to slide 3, which showed current motor
fuel tax rates and what they would be under CSSB 115(FIN)(efd
fld): highway fuel and marine fuel would increase from $.08 to
$.16 and $.05 to $.10, respectively; aviation fuel and jet fuel
would stay the same at $.047 and $.032, respectively; and the
off-road use refund would increase from $.06 to $.12. He
explained the off-road refund applied to gas used in snow
machines or other vehicles that did not use the public road
system, and to receive the refund, receipts must be kept and
sent to the Department of Revenue (DOR). The refund also
applied to mines that bought fuel for machinery, he said.
1:39:39 PM
REPRESENTATIVE STORY asked whether there was a breakdown of the
total revenue received from highway fuel, marine fuel, and off-
road use.
MR. PETERSON replied it hadn't been broken down as such for the
fiscal note, but the rough number was at $33.8 million,
approximately $5 million of which came from the marine fuel tax
and $28.8 million from the highway tax.
1:40:43 PM
REPRESENTATIVE CLAMAN asked why, after adjusting for inflation,
motor fuel tax had been set at $.52 and whether there was any
reason why CSSB 115(FIN)(efd fld) was not increasing motor fuel
tax more.
MR. PETERSON replied that a previous attempt to increase by two
tiers had not passed, so Senator Bishop had decided not to "bite
off such a big chunk" and instead just pass something that had
support.
REPRESENTATIVE CLAMAN asked whether these funds were dedicated
or designated.
MR. PETERSON replied that they were designated; none of the fuel
tax categories were dedicated. Designated funds were sub-funds
of the general fund, he said. All highway fuel tax proceeds
were deposited into the highway maintenance account, all marine
fuel tax proceeds were deposited into the watercraft account,
and off-road has its account meant to be used for trails.
1:43:39 PM
MR. PETERSON moved on to slide 4, regarding the impact the tax
increase would have on the average Alaska consumer. The
Division of Motor Vehicles (DMV) put the total number of
registered cars and trucks in Alaska at 654,826, Mr. Peterson
stated. The average number of miles per year per vehicle by
Kelley Blue Book was estimated at 15,000. To get the average
miles per gallon (mpg), the average for cars, 24.2, plus the
average for trucks, 17.5, was divided, coming up with 20.85 mpg
total. To reach the number of gallons of fuel used per year,
15,000 miles was divided by 20.85 mpg to come up with 719
gallons per year. The annual cost per vehicle, then,
multiplying 719 gallons by $.08 per gallon, was found to be
$57.52.
MR. PETERSON continued with slide 5, the Electric Vehicle
Registration Fee. There is an additional registration fee for
EVs, he imparted, because they do contribute to the need for
road maintenance and are heavier than gasoline-powered vehicles
due to the rechargeable batteries. About half of U.S. states
charge an additional registration fee for EVs for purposes of
maintenance since they do not buy gasoline, he added. The
proposal is to increase fees for EVs, of which there are 600-
plus in Alaska, from $100 to $200, as well as that of plug-in
hybrid vehicles, of which there are 300-plus in Alaska, from
$100 to $150. The revenue will be collected by the DMV and
deposited into the highway maintenance fund.
1:48:58 PM
CHAIR STUTES said that as an EV owner she personally was happy
to pay a fee to use the roads.
1:49:09 PM
REPRESENTATIVE STORY asked whether after eight years it would
still be in effect to obtain permanent registration for EVs and
plug-in hybrids.
1:49:44 PM
MR. PETERSON replied that was correct, for boroughs that
participated. He added that Juneau was not a participating
municipality.
REPRESENTATIVE STORY asked whether Mr. Peterson knew how the
permanent registration came to be.
MR. PETERSON said that he did not, but he would research it and
let the committee know.
1:51:38 PM
REPRESENTATIVE CLAMAN asked why CSSB 115(FIN)(efd fld) showed a
$100 increase in fees but the PowerPoint showed $200.
1:52:05 PM
MR. PETERSON replied that Section 1 in SB read "in addition to
other fees imposed", so the EV charge of $100 and $50 for plug-
in hybrids was in addition to the regular registration fee,
making EVs $250 and plug-in hybrids $150.
REPRESENTATIVE CLAMAN said folks have complained that a higher
registration for EVs and hybrids created a disincentive to
purchase those vehicles, and asked Mr. Peterson how he would
respond to the criticism that the increased fee makes it more
difficult for people to purchase vehicles that have some obvious
positive advantages in terms of climate change.
MR. PETERSON reiterated EVs did provide more wear and tear
because of their weight, but the sponsor had taken into
consideration that EVs and plug-in hybrids were better for the
environment, so that is why the increase was still lower bi-
annually than those with gas tax vehicles were paying per year.
1:56:11 PM
MR. PETERSON moved on to slide 6, which compared Alaska to other
states in terms of fuel tax rates. Alaska has the lowest tax
rate on highway fuel and marine fuel of any state, he informed
the committee. In most states, he added, the marine rate is the
same as the highway rate, so Alaska is one of the few states
that separates and charges a separate rate for marine fuel and
highway fuel. With the passage of SB 115, Alaska would remain
well below the national average in highway fuel, moving from
fiftieth to forty-first, and would still have the lowest tax on
marine fuel in the U.S.
MR. PETERSON showed slide 7, a graph that depicted the base
excise tax beside other fees and taxes imposed by each state.
He pointed out Pennsylvania, which had the second highest taxes
in the U.S. after California, even though they had no base
excise tax. Showing the other fees was important for "apples to
apples" comparison, he related. The chart did not include the
$.18 per gallon federal excise tax charged in every state, he
added. Mr. Peterson pointed out where Alaska currently stood at
the graph's far left, the lowest in the U.S. With the passage
of CSSB 115(FIN)(efd fld), Alaska would move ten spaces to the
right as indicated on the graph.
1:59:18 PM
CHAIR STUTES opened invited testimony on CSSB 115(FIN)(efd fld).
1:59:39 PM
DANIEL NICHOLS, American Society of Civil Engineers, informed
the committee that the American Society of Civil Engineers
(ASCE) was one of the oldest civil organizations in the U.S.
with 150,000 members. In Alaska there are about 900 members
across the state, he said, and they are politically motivated in
terms of infrastructure. In 2017 the organization issued an
"Alaska infrastructure report card," and Alaska's grade of C-
was still higher than the national average of D+. Alaska has
almost 5,600 miles of road, 60 to 70 percent of which are paved,
and all of which are extremely important in terms of
transporting people and goods. Funding has not increased since
the report had been done in 2017, he said. It was estimated
that there was about a $22 million deficit in operation and
maintenance, and ASCE had long been advocating for a fuel tax
increase. In 2013 ASCE estimated that failure to invest in
roads was costing American families $3,400 per year in increased
transportation costs. He related anecdotally that hitting a
pothole with a sport utility vehicle cost $500 to $600 to
repair. If that number were multiplied per number of vehicles
in a family, then it would start to add up quickly.
2:05:34 PM
MR. NICHOLS related to the committee the different metrics used
by DOT&PF, including a performance and economic rating system
which helped identify the condition of a road through different
factors on a scale from 2.5 to 4. Roads in Alaska were largely
around 3.1, which was considered marginal, he said. The system
had been devised in 2017, he reminded the committee, and the
transportation budget had not increased since then. As Mr.
Nichols pointed out, the fatalities on roads, however, had
increased.
2:08:06 PM
The committee took an at-ease from 2:08 p.m. to 2:09 p.m.
2:09:02 PM
NILS ANDREASSEN, Executive Director, Alaska Municipal League
(AML), spoke on the need for a healthy DOT&PF, which included
communities and "everything in between communities," he related.
Mr. Andreassen, referencing slide 2 of a PowerPoint
presentation, entitled "Funding Transportation: Municipal
Perspective," said it was understood municipalities managed
about 5,500 road miles, equal to DOT&PF road miles. The
municipal transportation budget, or the budget for roads, ports,
harbors, and airports, was $190 million, he said.
Municipalities' annual need as it applied to roads, when looking
at a $28,000 per mile national average, was around $154 million,
and the state of Alaska's need was $308 million, he stated. He
could also point to $2.8 billion in need when it came to
projects within boroughs, he said, and $1.9 billion in need for
projects outside boroughs.
MR. ANDREASSEN continued with slide 3, which looked at specifics
on ports and harbors. He pointed to a 2010 study by the Army
Corps of Engineers which stated roughly $600 million was needed.
He said AML would update the figure to include coastal
infrastructure needs. Mr. Andreassen provided detailed
information regarding port and harbor matching grants, which are
related to SB 115 directly, from 2007 to 2019: 98 of these were
requested; 45 were awarded. Of the grants awarded, 30 were
considered Tier I and 15 were considered Tier II. He also
looked at debt reimbursement for DOT&PF projects, as provided
for under House Bill 528 [passed during the Twenty-Second Alaska
State Legislature]. Reimbursement stood at 16.4 million, he
imparted. Regarding ferry terminals, another $68.25 million was
needed, he added.
2:12:45 PM
MR. ANDREASSEN directed the committee's attention to slide 4,
which listed municipal airports: Juneau International,
maintained by CBJ; Merrill Field, maintained by the municipality
of Anchorage; Ketchikan International, managed by Ketchikan
Gateway Borough; Kenai Municipal Airport; Kodiak Municipal
Airport; and Wasilla Municipal Airport. Only a few localities
had a motor fuel tax, he stated, looking at slide 5. Anchorage
was at $.10 per gallon, and Cold Bay and Larsen Bay were at 4
and 3 percent, respectively. Whittier and Bettles were others
with very minimal local taxation for motor fuel tax, he
imparted. Marine fuel tax was available for appropriation to
port and harbor facilities, he said. In terms of airports the
state did share 60 percent with municipalities that owned or
managed airports. These were Akutan, Anchorage, Craig, Delta
Junction, Egegik, Haines, Juneau, Kake, Kenai, Klawock,
Ketchikan, Kodiak, Nenana, North Slope Borough, Palmer, Pelican,
Port Alexander, Seldovia, Sitka, Soldotna, Thorne Bay, Wasilla,
Whale Pass, Wrangell, and Yakutat, Mr. Andreassen shared with
the committee.
2:14:24 PM
MR. ANDREASSEN said that SB 115 would improve things.
Referencing slide 6, which looked at motor fuel tax, the
additional $30.5 million within DOT&PF would cover Southcoast
operations, he said. It would cover General Fund (GF) funding
for Central and Southcoast divisions. It would cover one-fifth
of the funding necessary for road maintenance. For marine fuel,
the additional $5.7 million wouldn't go a long way and was
probably insufficient considering the need. The state requested
$12.5 million and there is $5 million budgeted. The $5.7
million would cover just under one percent of port and harbor
infrastructure needs, he related.
MR. ANDREASSEN turned to slide 7, a map published by the
American Petroleum Institute, of gasoline taxes nationwide.
Alaska was in the "less than $.40 per gallon" category. The
average was found to be $.55. Slide 8 showed gasoline tax
increases or reforms enacted between 2013 and 2019; Mr.
Andreassen acknowledged that more recent data could be found on
these. Slide 9 showed states with variable-rate gasoline taxes,
in which inflation and fuel economy indexing, as well as EV and
plug-in hybrid vehicle fees were taken into consideration. In
many ways SB 115 mirrored nationwide trends, Mr. Andreassen
imparted, although it still had a way to go in terms of fully
funding infrastructure. Referencing slide 10, he added SB 115
increased Alaska's purchasing power as it applied to roads and
reiterated there was a critical need for the funding and support
of DOT&PF. He pointed out marine fuel tax sharing is important
to local governments responsible for the entirety of Alaska's
coastal infrastructure. Last, Mr. Andreassen said a portion of
SB 115 should be reserved for community infrastructure needs.
2:18:43 PM
REPRESENTATIVE EDGMON pointed out the last state to institute
income tax was Connecticut, and most states have had sales tax
in place for many years. He offered Mr. Andreassen the
opportunity to comment why this was not the case with gasoline
tax.
MR. ANDREASSEN replied that the taxes are considered user fees,
so for a nation that has huge infrastructure gaps states could
make a pretty strong argument for increasing a tax such as this
and directing it toward improved living conditions.
REPRESENTATIVE EDGMON clarified a point Mr. Andreassen made on
slide 5 that state fuel tax went to GF for DOT&PF.
2:21:25 PM
REPRESENTATIVE CLAMAN said that SB 115 would add $70 million in
state revenue and that may not pay the capital match to meet the
federal fund. In the future there would need to be an even
bigger federal match. He asked whether the legislature should
consider a slightly higher fuel rate that would provide a
greater chance of meeting the federal match fund-wise.
2:23:22 PM
MR. ANDREASSEN asked whether the match to which Representative
Claman referred was capital needs versus operations.
REPRESENTATIVE CLAMAN replied that the question was still how
much was being contributed to transportation. If the federal
funds increased, he stated, the amount needed to make the match
would increase.
MR. ANDREASSEN agreed with Representative Claman and said AML's
potential to increase the funding source during a period of
fiscal crisis should be considered. Whether for infrastructure
or operations, there was a deficit and a challenge, he said. It
would work better for AML members to support an increase beyond
what was proposed if some of the increase came back to local
governments, which might in turn supply a local match for some
of the same projects.
2:25:10 PM
FRANCIS LEACH, Executive Director, United Fishermen of Alaska,
representing 36 commercial fishing groups in Alaska, testified
regarding the marine fuel tax in SB 115. United Fishermen of
Alaska (UFA) understood that the tax was necessary to maintain
infrastructure and that it had not been raised in some time, but
UFA has faced numerous additional expenses over the past few
years, Ms. Leach stated, and a tax increase would be at a
detriment to commercial fishermen. Kodiak saw a 25 percent
increase in solid waste collection and disposal fees in both
2016 and 2017, she offered. In 2018 there was an increase in
the sales tax cap from $750 to $3000, or 300 percent, on
groceries and fuel.
MS. LEACH said the City of Kodiak increased harbor fees by 18.5
percent starting in July of 2017 and 2.8 percent annually after
that; this was the trend all over Alaska ports and was hitting
boaters hard. She stated that Chinese tariffs were also hurting
fishermen: as of January 2020, 37 to 42 percent tariffs on
seafood into China and "tariff on, tariff off again" policy was
forcing down prices overall. With the drop of fish prices, the
pink salmon disaster, lack of Pacific cod fisheries, rise in
fuel costs, continued trade tensions between the European Union
over World Trade Organization trade disputes, and the novel
Coronavirus threatening to further impact tourism, Ms. Leach
said that SB 115 could harm the commercial fishing industry,
which in 2017 paid $172,000,000 in taxes.
MS. LEACH mentioned that it was not only commercial fishermen
who would be adversely affected but all boat and watercraft
users, especially those who catered to tourism. She asked the
committee to consider relief under SB 115 for boat and
watercraft users.
2:29:18 PM
CHAIR STUTES announced that CSSB 115(FIN)(efd fld) would be held
over.
2:30:12 PM
ADJOURNMENT
There being no further business before the committee, the House
Transportation Standing Committee meeting was adjourned at 2:30
p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 253 v. M 2.17.20.PDF |
HTRA 2/25/2020 1:00:00 PM HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Sponsor Statement 2.17.20.pdf |
HTRA 2/25/2020 1:00:00 PM HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Sectional v. M 2.17.20.pdf |
HTRA 2/25/2020 1:00:00 PM HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Support Document - AMHS Vessel Status 2.21.19.pdf |
HTRA 2/25/2020 1:00:00 PM HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Fiscal Note - DOT&PF 2.22.2020.pdf |
HTRA 2/25/2020 1:00:00 PM HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Testimony - Received by 3.02.2020.pdf |
HTRA 3/3/2020 1:00:00 PM HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Amendment #1.pdf |
HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| HB 253 Testimony Submitted by 3.10.2020.pdf |
HTRA 3/10/2020 1:00:00 PM |
HB 253 |
| CSSB 115(FIN)(efd fld) ver. K.A 3.3.20.PDF |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Sponsor Statement 3.2.20.pdf |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 Sectional Analysis 3.2.20.pdf |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 Fiscal Note - DOR 2.24.20.PDF |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Fiscal Note - DOA 2.24.20.PDF |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Fiscal Note - DOT&PF 2.20.20.PDF |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| Senate Bill 115 PowerPoint 3.3.2020.pptx |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 - FAQs.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Motor Fuel Tax by State Graph 2.12.2020.pdf |
HFIN 3/20/2020 9:00:00 AM HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Anchorage Daily News editorial 2.8.20.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Letter of Support - Alaska Municipal League 1.30.20.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Letter of Support - JEVA 2.20.2020.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Letter of Support - Fairbanks Chamber of Commerce 2.27.20.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Letter of Support - AFL-CIO 3.8.2020.pdf |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 Support Document - Fall 2019 Revenue Sources Book Chapter 5.pdf |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 Support Document - 2018 Motor Fuel Tax Report, Tax Division, Department of Revenue.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Support Document - Federation of Tax Administrators, motor fuel tax rates, January 2019.pdf |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |
| SB 115 Support Document - Leg. Research MFT revenue 1993-2018.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Support Document - LFD Fund Sources_Motor Fuel Tax_2018.pdf |
HTRA 3/10/2020 1:00:00 PM HTRA 3/12/2020 1:00:00 PM |
SB 115 |
| SB 115 Presentation from AML 3.10.2020.pptx |
HTRA 3/10/2020 1:00:00 PM |
SB 115 |