02/15/2024 01:30 PM Senate COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SB207 | |
| SB179 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 161 | TELECONFERENCED | |
| *+ | SB 179 | TELECONFERENCED | |
| += | SB 207 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
February 15, 2024
2:10 p.m.
DRAFT
MEMBERS PRESENT
Senator Forrest Dunbar, Chair
Senator Elvi Gray-Jackson
Senator Jesse Bjorkman
Senator Cathy Giessel
MEMBERS ABSENT
Senator Donald Olson, Vice Chair
COMMITTEE CALENDAR
SENATE BILL NO. 207
"An Act creating the military and veteran family help desk in
the Department of Military and Veterans' Affairs; and providing
for an effective date."
- MOVED SB 207 OUT OF COMMITTEE
SENATE BILL NO. 179
"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
SENATE BILL NO. 161
"An Act relating to municipal taxation of farm use land; and
providing for an effective date."
- <ABOVE ITEM REMOVED FROM AGENDA>
PREVIOUS COMMITTEE ACTION
BILL: SB 179
SHORT TITLE: PROPERTY TRANSFER TAX; MUNI TELECOMM TAX
SPONSOR(s): SENATOR(s) BJORKMAN
01/16/24 (S) PREFILE RELEASED 1/12/24
01/16/24 (S) READ THE FIRST TIME - REFERRALS
01/16/24 (S) CRA
02/15/24 (S) CRA AT 1:30 PM BELTZ 105 (TSBldg)
BILL: SB 207
SHORT TITLE: MILITARY AND VETERAN FAMILY HELP DESK
SPONSOR(s): SENATOR(s) KAWASAKI
01/26/24 (S) READ THE FIRST TIME - REFERRALS
01/26/24 (S) CRA, FIN
02/08/24 (S) CRA AT 1:30 PM BELTZ 105 (TSBldg)
02/08/24 (S) Heard & Held
02/08/24 (S) MINUTE(CRA)
02/15/24 (S) CRA AT 1:30 PM BELTZ 105 (TSBldg)
WITNESS REGISTER
RILEY VON BORSTEL, Staff
Senator Scott Kawasaki
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Available to answer questions on SB 207.
KONRAD JACKSON, Staff
Senator Jesse Bjorkman
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Presented the sectional analysis for SB 179
on behalf of the sponsor.
ANN SPARKS, Past President
Southeast Alaska Board of Realtors
Juneau, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
MARK MASLEY, Director
Alaska Realtors
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
ANDREW DUNMIRE, Legislative Counsel
Legal Services
Legislative Affairs Agency
Juneau, Alaska
POSITION STATEMENT: Answered questions during the discussion of
SB 179.
KAITLYN ESPADA, President-Elect
Mat-Su Valley Board of Realtors
Wasilla, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
TERRY BRYAN, Strategic Program Manager
Steward Title Insurance Company
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
JOE LOGAN, Secretary-Treasurer
Board of Realtors - Anchorage and Alaska
Anchorage, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
ELISE BUCHHOLZ, President-Elect
Alaska Realtor Association
Wasilla, Alaska
POSITION STATEMENT: Gave invited testimony in support of SB 179.
ACTION NARRATIVE
2:10:41 PM
CHAIR FORREST DUNBAR called the Senate Community and Regional
Affairs Standing Committee meeting to order at [2:10 p.m.]
Present at the call to order were Senators Gray-Jackson,
Giessel, Bjorkman, and Chair Dunbar.
SB 207-MILITARY AND VETERAN FAMILY HELP DESK
2:11:59 PM
CHAIR DUNBAR announced the consideration of SENATE BILL NO. 207
"An Act creating the military and veteran family help desk in
the Department of Military and Veterans' Affairs; and providing
for an effective date."
He said that this is the second hearing of SB 207 in the Senate
Community and Regional Affairs Committee. The intention is to
look to will of the committee and take action on SB 207. He
invited Ms. von Borstel to offer comments.
2:12:31 PM
RILEY VON BORSTEL, Staff, Senator Scott Kawasaki, Alaska State
Legislature, Juneau, Alaska, stated that she was available to
answer questions and indicated she had no further comments to
offer on SB 207.
2:12:40 PM
CHAIR DUNBAR gave committee members an opportunity to ask final
questions. Finding none, he solicited a motion.
2:12:57 PM
SENATOR GIESSEL moved to report SB 207, work order 33-LS1234\A,
from committee with individual recommendations and attached
fiscal note(s).
2:13:10 PM
CHAIR DUNBAR found no objection and SB 207 was reported from the
Senate Community and Regional Affairs Standing Committee.
2:13:17 PM
At ease.
SB 179-PROPERTY TRANSFER TAX; MUNI TELECOMM TAX
2:15:05 PM
CHAIR DUNBAR reconvened the meeting and announced consideration
of SENATE BILL NO. 179 "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."
He said that this is the introductory hearing of this bill. The
intent is to hear an introduction of SB 179, review the
sectional analysis, have committee discussion, and hear public
testimony. He invited the bill sponsor to introduce his bill.
2:16:20 PM
SENATOR BJORKMAN, speaking as sponsor, introduced SB 179, as
paraphrased below:
This straightforward bill would disallow municipalities and home
rule cities from taxing the sale of real property. The impetus
of this bill is to ensure local tax authority groups are not
able to levy taxes on property and, by levying those taxes,
discourage the sale of property. Especially the sale of property
that could be used for building homes and residences during this
housing shortage and crisis in much of Alaska.
2:17:42 PM
KONRAD JACKSON, Staff, Senator Jesse Bjorkman, Alaska State
Legislature, Juneau, Alaska, presented the following sectional
analysis for SB 179 on behalf of the sponsor:
[Original punctuation provided.]
This is a summary only. Note that this sectional
analysis should not be considered an authoritative
interpretation of the bill and the bill itself is the
best statement of its contents.
Section 1. Amends AS 29.10.200(56) conforming to
Section 4, to add reference to new subsection (l).
Section 2. Amends AS 29.10.200(57) conforming to
Section 6, to add reference to new subsection (h).
Section 3. Amend AS 29.45.650(a) adding reference to
subsection (k) and (l).
Section 4. Amends AS 29.45.650 to add new subsection
(l) to provide that a borough may not levy or collect
a sales tax on the transfer of real property if the
borough is a home rule or general law municipality.
Section 5. Amends AS 29.45.700(a) to add reference to
(g) and (h).
Section 6. Amends AS 29.45.700 to add new subsection
(h) providing that a city may not levy or collect a
sales of use tax on the transfer of real property if
the city is a home rule or general law municipality.
Section 7. Amends AS 43.98 by adding new section to
article 3, AS 43.98.035 provides that the state may
not levy or collect a sales or use tax on the transfer
of real property.
Section 8. Repealer section relating to municipal
taxation of mobile telecommunication devices.
2:20:13 PM
SENATOR GRAY-JACKSON asked about the repealer language in
Section 8.
2:20:42 PM
MR. JACKSON replied that Legislative Legal occasionally finds
inconsistencies in statute. The passage of SB 207 would create
some inconsistency. So, the drafters added Section 8 to clean up
that language, removing the inconsistency from AS 29.45.650(a).
He deferred the question to Mr. Dunmire for further explanation.
2:21:34 PM
CHAIR DUNBAR asked for a more detailed description of the
repealer in Section 8.
2:22:07 PM
MR. JACKSON offered to get Mr. Dunmire from Legislative Legal on
the phone to answer questions about the repealer while the chair
took up invited testimony.
2:22:25 PM
CHAIR DUNBAR asked whether any municipalities currently levy
this kind of tax.
SENATOR BJORKMAN expressed his belief that two municipalities
have this kind of tax. According to the Alaska Municipal League
(AML), the City of Bethel and North Pole levy a type of transfer
tax that would fall under this prohibition.
CHAIR DUNBAR commented that this was good to know, as he thought
there were none.
2:23:26 PM
SENATOR GRAY-JACKSON asked if the two municipalities could be
grandfathered in. She explained that the tax collected by these
municipalities supports their operating costs and budgets in
some form.
2:24:01 PM
CHAIR DUNBAR announced invited testimony on SB 179.
2:24:31 PM
ANN SPARKS, Past President, Southeast Alaska Board of Realtors,
Juneau, Alaska, gave invited testimony in support of SB 179,
mainly representing realtors. She is a 22-year veteran of the
U.S. Coast Guard (USCG) and has lived in Alaska 12 years. She
has been a homeowner since 2016 and owns a small business in
Southeast Alaska. She emphasized that homeownership is a conduit
to wealth and stability; everyone needs a home. She described
reasons price disclosure and transfer taxes contribute to
housing market instability:
Sales Price Disclosure
She highlighted that the Juneau Assembly passed a price
disclosure ordinance on real property during COVID in 2020,
which inflated the housing market during the pandemic. This
ordinance mandated the collection of sales price data on real
property transactions. She noted that during the pandemic,
Juneau experienced a limited supply of homes, leading buyers to
pay above the appraised value in cash, thereby significantly
driving up home prices. The city used collected price data in
the calculation of property assessments, resulting in increased
assessed real estate values and, consequently, higher property
taxes. She pointed out that the mill rate is not the sole
determinant of property taxes; higher assessments also
contribute to higher property taxes.
2:26:28 PM
MS. SPARKS explained that the sale of a property is a contract
involving many negotiated costs. So, a home's sales price may
not reflect the home's true value because the negotiated costs
are undisclosed. Nonetheless, the city used these skewed values
to determine property taxes. She illustrated this point with a
"cookie-cutter" example involving the sale of a condo, which
affected the property taxes of the entire condo complex:
• A buyer pays $100,000 over appraised value in a competitive
multiple-offer situation.
• The sale price is disclosed.
• The city uses the sale price to calculate the new assessed
value for every condo in the complex.
• Property taxes increase accordingly, affecting first-time home
buyers, families, single parents, and seniors on fixed
incomes.
MS. SPARKS said that 39 states with disclosure laws have adopted
transfer taxes as high as three percent at the city, county, or
state level.
2:27:58 PM
Transfer Tax
MS. SPARKS asserted that transfer taxes increase housing prices.
Alaska Statutes allow municipalities to levy property taxes. She
emphasized the importance of keeping housing prices lower for
seniors on fixed incomes and young adults in their 20s who
cannot afford a home. As a realtor who works with military
veterans and the U.S. Coast Guard community, she explained that
transfer taxes burden military personnel who are typically in a
home for only three or four years. These individuals often have
their nest egg and retirement tied up in their homes. When they
sell the house, they need to recoup the transfer tax cost, which
contributes to the high cost of housing.
MS. SPARKS urged prohibiting transfer taxes and keeping Alaska a
nondisclosure state to promote stability in home prices and
related impacts, such as property taxes, interest rates,
inflation, and insurance costs.
2:30:39 PM
MS. SPARKS mentioned that Juneau voted for Proposition 4, which
repealed the sales price disclosure ordinance. The repeal
demonstrated that financial privacy and nondisclosure are
important to Juneau residents. She explained that disclosure
ordinances affect multiple aspects of real property ownership,
not just homeownership but also rental prices for residential
and commercial properties. Landlords had to increase rents to
recoup costs. She highlighted the interconnected nature of these
issues and advised following the trail to understand how a
transfer tax could impact the housing market.
2:31:47 PM
SENATOR GIESSEL sought confirmation that Alaska is a
nondisclosure state and wondered how the City and Borough of
Juneau (CBJ) implemented a sales price disclosure ordinance.
MS. SPARKS replied that while Alaska is generally known as a
nondisclosure state, this status is not explicitly stated in the
Alaska State Constitution nor codified in statute. Alaska
Statutes have a provision for financial privacy but lack a
detailed definition. This allows municipalities to decide
whether to require sale price disclosure for their communities.
The disclosure ordinance was unpopular in Juneau. Even though
the ordinance was in effect, people were not disclosing sales
prices, believing it conflicted with the Alaska State
Constitution. The City of Juneau imposed a 30-day window for
compliance, after which a $50 per day fee was instituted for
noncompliance. She appreciated that the voters overturned the
ordinance but observed that two years of mandatory sales price
disclosure damaged the housing market. Assessment values in
Juneau became unmanageable, with some commercial properties
experiencing a 50 percent increase in land value, followed by
another 50 percent increase the next year. These commercial
properties are now stagnant and unable to sell at their assessed
value.
MS. SPARKS acknowledged that while SB 179 does not address
disclosure, the issues are interconnected. She reiterated that
preventing a transfer tax would help with these issues.
2:33:40 PM
CHAIR DUNBAR expressed appreciation for the distinction made
between disclosure and transfer tax because they are separate
issues. He said Anchorage faces a different set of issues, where
relatively few people are willing to sell property at the
assessed value, which tends to be lower than the sale prices. He
opined that a transfer tax decreases the ability of property to
change hands and would potentially increase the expense of
housing, among other implications.
2:34:25 PM
SENATOR GRAY-JACKSON thanked the testifier. She expressed
support for SB 179, stating she is a cosponsor. She asked her to
comment on grandfathering in communities that already collect
this tax.
MS. SPARKS replied that CBJ taxes real estate commissions in
Juneau, real estate transactions are taxed. The city considers
the commission a service and taxes it at five percent. There is
a cap for high-priced sales, so the tax on commissions is capped
at $675. The City and Borough of Juneau collects this tax on the
sale of a home, and it is directly related to the commission
services that are provided. She said she could not speak to the
specifics of sales taxes in other municipalities, as this was
the first time she heard of that. She expressed an understanding
that smaller communities need taxes and revenue streams to
support cities. She acknowledged the necessity for a grandfather
period to allow communities time to look for other revenue
stream opportunities.
2:36:30 PM
MARK MASLEY, Director, Alaska Realtors, Anchorage, Alaska, gave
invited testimony in support of SB 179 on behalf of Alaska
Realtors. Alaska Realtors represents 1,900 plus realtors from
Southeast Alaska to Nome. The organization's purpose is to
create a positive real estate business environment by promoting
and protecting its members, real property ownership, and private
property rights. He is a realtor serving Anchorage and the Mat-
Su Borough. He lives in a home he has owned for 18 years in
Senate District H. He spoke as an Alaska Realtors
representative, concerned citizen, and homeowner.
2:37:21 PM
MR. MASLEY provided a brief history of reasons realtors are
involved with the issue of SB 179. It harkens back to Juneau's
disclosure ordinance, which mandated the disclosure of real
property sale prices to the city's assessor. Alaska has
traditionally maintained a nondisclosure policy regarding real
estate prices, valuing financial privacy. He pointed out that in
39 other states, the disclosure of real estate prices has often
preceded the implementation of a transfer tax. The transfer tax
in Washington is as high as three percent of the sales price,
meaning a $90,000 tax on a $3,000,000 home. Despite the repeal
of the disclosure ordinance by voters, the threat of future
changes in disclosure rules could lead to implementing a
transfer tax.
MR. MASLEY argued that imposing such a tax would increase the
overall cost of homeownership. The average price of a single-
family home in Anchorage exceeds $480,000. With the critically
low supply of homes and 30-year fixed mortgage rates of around 7
percent, homeownership dreams are slipping away for many home
buyers.
2:39:14 PM
MR. MASLEY said that in addition to increasing the cost for
buyers, transfer taxes also increase the cost of selling. During
COVID, some homeowners were fortunate to secure refinanced
mortgage rates as low as 2 1/2 percent. Consequently, many of
these individuals are choosing to hold onto their properties.
Realtors call this a "rate lock;" instead of selling, owners are
investing in upgrades and staying put because of the disparity
between the 2 1/2 percent mortgage they have and the 7 percent
market mortgage that is available. The shortage of available
homes is also a significant factor in the decision not to sell.
If homeowners are unsatisfied or unable to find a home that
meets their needs, they will remain in their current home rather
than sell. This leads to a self-perpetuating cycle of low
inventory, resulting in fewer homes for prospective buyers and
higher home costs. He emphasized that adding a transfer tax
would provide another reason for homeowners to hang onto their
houses instead of putting them on the market.
2:40:27 PM
MR. MASLEY said SB 179 represents critical steps for
safeguarding Alaska's economic health and ensuring homeownership
remains attainable. By prohibiting the levy of a transfer tax on
real property, this bill would alleviate some of the financial
pressures faced by buyers and sellers, thereby creating a more
accessible market overall. He said that as a realtor, he
constantly witnesses the struggles prospective buyers experience
in this housing market. Now more than ever, it is clear that the
state needs to adopt measures that support the stability and
growth of this sector of the economy. He pointed out that real
estate transactions and the resulting ancillary transactions
represent about 16 to 17 percent of the state's economy.
MR. MASLEY urged the committee to consider the long-term
benefits of this bill for the economic health and well-being of
Alaska's communities. He emphasized that SB 179 proposes a
significant step towards a more resilient and inclusive housing
market where Alaskans still maintain the dream of homeownership.
2:42:20 PM
CHAIR DUNBAR asked Mr. Dunmire to explain the repealer provision
in Section 8.
2:42:37 PM
ANDREW DUNMIRE, Legislative Counsel, Legal Services, Legislative
Affairs Agency, Juneau, Alaska, answered the repealer is a
conforming change. It deals with a session law that is still on
the books with a contingency. He explained the repealer
provision as follows:
• The legislature enacted AS 29.45.750, [the Mobile
Telecommunication Sourcing Act], which deals with mobile
telecommunications and taxing under a federal law.
• The Act included a contingent effect.
• This meant that the specific statute section would be repealed
if a court of competent jurisdiction, whose decisions are
binding in the state, enters a final judgment that
substantially limits or impairs the underlying elements of
that Act.
• Section 3 of the bill amends AS 29.45.650(a), and the first
sentence of subsection (a) references AS 29.45.750.
• If the legislature does not address the existing session law
and the contingency goes into effect, it will:
• delete AS 29.45.750,
• replace it with different language, and
• omit the references to subsections (a) and (l) that were
added to this bill.
MR. DUNMIRE said that this would create an inconsistency in the
law.
2:44:05 PM
CHAIR DUNBAR sought clarification about what would change in
Alaska law with that repealer if anything, or if it was simply
to prevent the inconsistency described.
MR. DUNMIRE replied that the change would eliminate the
contingency, so AS 29.45.750 would not be repealed if
successfully challenged in federal court.
2:44:53 PM
CHAIR DUNBAR sought clarification on what he meant by
"contingency."
MR. DUNMIRE replied that the legislature often includes
contingent effects in bills for specific sections or provisions.
In this case, the contingency was that if a federal law, now
over twenty years old, was ruled unconstitutional by a federal
court, the corresponding state law would be repealed.
2:45:45 PM
SENATOR GRAY-JACKSON appreciated the chair's request for further
explanation, stating she would have asked the same questions.
2:46:01 PM
SENATOR GIESSEL said that she has the Alaska Statutes opened and
is looking at AS 29.46.650 and AS 29.45.750. These statutes
reference U.S. Codes related to mobile telecommunications and
the food stamp program, which she noted is confusing.
MR. DUNMIRE drew attention to AS 29 45 750(a) and referenced the
provision that reads, "The provisions of 4 U.S.C. 116 126
(Mobile Telecommunications Sourcing Act) are incorporated in
this chapter by reference...". He explained that federal law was
the basis for this section when the Alaska State Legislature
enacted it. He presumed that, at the time, the legislature
thought there was a chance the federal law would be successfully
challenged in court and ruled unconstitutional. So, the
legislature included contingency language, stating that if that
happens, then AS 29.45.750 would be repealed. However, it has
been several decades, and that has not happened.
2:47:41 PM
SENATOR GIESSEL asked why that is relevant to SB 179.
MR. DUNMIRE answered that it is relevant because the first
sentence of AS 29.45.650(a) explicitly cites AS 29.45.750. The
session law with the contingency says that if AS 29.45.750 gets
repealed, AS 29.45.650 must have new language to avoid citing a
repealed section of law. He explained that SB 179 includes
subsections (k) and (l), but the replacement language would not.
2:48:48 PM
CHAIR DUNBAR commented that he needs to review the statutes.
CHAIR DUNBAR sought confirmation that:
• the bill sponsor did not intend to touch that piece of law,
• this is unrelated to a transfer tax and is entirely separate,
and
• Legislative Legal included it in SB 179 for purely drafting
reasons.
MR. DUNMIRE replied if the repealer is removed from the bill,
the sponsor will have to amend the bill and change the session
law to keep everything consistent. He confirmed that repealing
that section has nothing to do with property tax or transfer
taxes; it is included for cleanup. If the repealer is removed
from the bill, a different provision would need to be added to
address the contingency if it ever happens.
2:50:04 PM
CHAIR DUNBAR asked for a written description of what he had just
explained to the committee and whether the bill makes a
substantive change to Alaska Statutes by repealing this section.
Mr. DUNMIRE replied that he could provide that.
CHAIR DUNBAR expressed his appreciation and looked forward to
receiving the written description.
2:50:58 PM
CHAIR DUNBAR continued with invited testimony on SB 179.
2:51:13 PM
KAITLYN ESPADA, President-Elect, Mat-Su Valley Board of
Realtors, Wasilla, Alaska, gave invited testimony in support of
SB 179, stating she is a realtor in the Mat-Su Valley and has
been in the industry since 2013.
MS. ESPADA said that she had a data-driven approach to explain
her viewpoint on the damaging effects of transfer taxes. She
pulled up today's multiple listing service (MLS) data and
delineated the damaging impact on the costs included in a
downpayment to buy an average-priced home in Palmer. She noted
that this time last year, the average-priced home in Palmer was
$426,000. This year, the average-priced home in Palmer is five
percent more. At $443,000, this increases the mortgage by $3,500
more per month than a buyer would have paid last year. She
explained that a transfer tax would exclude a whole segment of
the market from being able to purchase homes. She explained that
buyers with a regular Federal Housing Administration (FHA) loan
have to come up with $10,000 for their closing costs, a
downpayment of $15,500 at 3.5 percent, and a transfer tax of
$4,873 on the average sales price in Palmer today, which is
$443,000. Therefore, buying a house in Palmer today with an FHA
loan requires over $30,000 in the bank.
2:53:04 PM
MS. ESPADA said the lack of inventory is driving up prices, and
they are not coming down. The Mat-Su Borough is the fastest-
growing home market for the working class in the state. She said
Alaskans need to ensure that transfer taxes are prohibited
because they will harm the housing market.
2:53:51 PM
TERRY BRYAN, Strategic Program Manager, Steward Title Insurance
Company, Anchorage, Alaska, gave invited testimony in support of
SB 179, stating that he has been an Alaska resident for 46
years. He has lived in District E since 1989. With 27 years in
the title insurance business, he has had daily contact with over
500,000 consumers, both buyers and sellers. He mentioned that he
has never heard a positive comment about a transfer tax. It is
not unusual to hear clients from other states say, "I just moved
from an area where I was penalized with a transfer tax." He said
that the public has traditionally been concerned about this
issue. People often scrimp and save or leverage other assets to
purchase a home, and increasing costs will negatively affect
affordable housing and homeownership.
MR. BRYAN noted that he hears about affordable housing concerns
weekly and is certain that committee members hear about it
statewide. Homeownership will be negatively impacted by any
increase in the cost of entry, particularly during these
inflationary times. Increased interest rates are not expected to
return, in our lifetime, to the low levels seen recently. He
stressed that this period of high inflation and higher interest
rates will persist for a while, and any cost increase will have
a negative impact. He said that he promotes the passage of SB
179.
2:56:07 PM
JOE LOGAN, Secretary-Treasurer, Board of Realtors - Anchorage
and Alaska, Anchorage, Alaska, gave invited testimony in support
of SB 179, stating he is a realtor who has been in business for
22 years. He started in Washington, a state that currently has a
transfer tax. He said that Washington's real estate market
experienced tough times, with many foreclosures, and the state's
transfer tax significantly impacted homeowners trying to recover
from the downturn. Though the market is doing well and
homeowners have equity in their homes, he emphasized the
importance of considering the long-term for every type of
market.
MR. LOGAN said that when he first moved to Anchorage, he was
amazed that there was 36 months' worth of inventory at nearly a
$1,000,000 price point. Currently, there is only 3/4 of a
month's worth of inventory for the entire Municipality of
Anchorage. If all the current listings were to sell, it would
take buyers about 3/4 of a month to deplete the available
inventory. He stressed that with low housing inventory, it is
crucial to consider the overall picture of the market and the
potential impacts on sellers. He said that the National
Association of Realtors did a study titled The Unintended
Consequences of Excessive Transfer Taxes conducted by Sage
Policy Group in June 2022. The study explored several markets
and explained in detail the historical consequences of this type
of tax.
2:59:21 PM
ELISE BUCHHOLZ, President-Elect, Alaska Realtor Association,
Wasilla, Alaska, gave invited testimony in support of SB 179,
stating that she is an associate broker in the Mat-Su Valley.
She explained that in the Mat-Su Borough, homeowners receive a
notice with an application asking what they sold their house
for. Realtors advise consumers to refrain from filling it out to
keep Alaska a nondisclosure state. She noted that assessments
have increased in the Mat-Su Valley since COVID, with home
values getting closer to Anchorage prices. The median home price
for the entire Valley, not just Palmer, is $407,000, compared to
Anchorage's $480,000. The price difference, which used to be
about $150,000 to $200,000, is narrowing. Wasilla, according to
economists, is the fastest-growing area in Alaska.
MS. BUCHHOLZ mentioned that the Valley's popularity and events
like the Arctic Winter Games have further limited the supply of
rentals or short-term rental properties. The Mat-Su needs
apartment buildings and new construction. Transfer taxes would
cause prices to rise more. She emphasized that she cannot say
enough about the borough's low inventory. She has renters who
want to buy homes but find renting cheaper than a mortgage due
to high interest rates and additional closing costs.
3:02:01 PM
CHAIR DUNBAR concluded invited testimony on SB 179.
CHAIR DUNBAR held SB 179 in committee.
3:02:22 PM
There being no further business to come before the committee,
Chair Dunbar adjourned the Senate Community and Regional Affairs
Standing Committee meeting at 3:02 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB179 ver A.pdf |
SCRA 2/15/2024 1:30:00 PM |
SB 179 |
| SB179 Sectional Summary ver A.pdf |
SCRA 2/15/2024 1:30:00 PM |
SB 179 |
| SB179 Sectional Summary ver A.pdf |
SCRA 2/15/2024 1:30:00 PM |
SB 179 |
| SB179 Sponsor Statement ver A.pdf |
SCRA 2/15/2024 1:30:00 PM |
SB 179 |
| SB 207 Sectional.pdf |
SCRA 2/15/2024 1:30:00 PM SFIN 3/19/2024 9:00:00 AM |
SB 207 |
| SB 207 Sponsor Statement.pdf |
SCRA 2/15/2024 1:30:00 PM SFIN 3/19/2024 9:00:00 AM |
SB 207 |
| SB 207 Background Information.pdf |
SCRA 2/15/2024 1:30:00 PM |
SB 207 |
| SB 207.pdf |
SCRA 2/15/2024 1:30:00 PM SFIN 3/19/2024 9:00:00 AM |
SB 207 |