HOUSE BILL NO. 334 An Act relating to an exemption from and deferral of municipal property taxes for certain types of deteriorated property. Representative Holm MOVED to RESCIND previous action taken on adopting Amendment #1, #24-LS1353\A.3, Cook, 2/14/06. There being NO OBJECTION, action was rescinded. Representative Holm MOVED to ADOPT Amendment #2, #24- LS1353\A.4, Cook, 2/15/04. Vice Chair Stoltze OBJECTED. JIM POUND, STAFF, REPRESENTATIVE JAY RAMRAS, spoke to the amendment. He explained that following discussions with the municipalities and other governmental members, the language of #1 was simplified. Essentially, it would accomplish giving control to the municipality for what and how to accomplish the deferrals, Page 1, Line 12, deleting language and inserting a new section. The new language will provide finality to developers trying to restore the buildings through the application process. 4:35:56 PM Vice Chair Stoltze asked if the Fairbanks local government was in support of the legislation. Mr. Pound thought they were. 4:36:12 PM Representative Hawker acknowledged that with the proposed amendment, the bill could accomplish "something" but questioned if it would accomplish what was intended. He explained that the amendment clarifies in Statute a requirement regarding when a municipality authorizes one of the tax deferral activities that they must establish a schedule of dates certain to trigger a tax payment. Mr. Pound said that was correct. 4:37:21 PM Representative Hawker advised that this Legislature would be proscribing future legislatures criteria that might not be appropriate when approaching the municipality. He worried about forcing a date limiting the criteria to a date certain, which would compromise the abilities of the municipalities to pursue that type transaction. He thought the legislation was appropriate for only one specific transaction and not sufficiently broad. Mr. Pound said they attempted to keep the language as simple as possible, but agreed some cases could change that. 4:39:07 PM Representative Hawker stated that the amendment would prohibit such latitude, wondering if that was truly the intent. Mr. Pound noted the developers want a date certain. He added the latitude would be available to the developer and the municipality. 4:40:02 PM Representative Hawker voiced opposition with the Legislature dictating criteria to all municipalities throughout the State. 4:40:21 PM Representative Kerttula agreed with Representative Hawker. She recommended adding language to the Amendment on Line 5, inserting something like "unless otherwise agreed to by both parties". She thought that language could provide the option to negotiate out. Mr. Pound agreed. 4:41:07 PM Representative Hawker asked if it would accomplish the sponsor's goal and provide latitude preserved for the municipalities, by amending Line 5 to read, "deferred tax payments due as specific by the municipality". With that language, the date would not always be the trigger point. Other criteria could be appropriate. 4:42:42 PM REPRESENTATIVE JAY RAMRAS, SPONSOR, noted appreciation for that perspective. He asked an example for a practical application. 4:43:39 PM Representative Hawker stressed that he was not offering advise as a Certified Public Accountant (CPA). Representative Ramras noted he would support the language offered by Representative Hawker. Co-Chair Meyer requested that Ms. Cunningham testify regarding the proposed changes. SUZANNE CUNNINGHAM, STAFF, REPRESENTATIVE KEVIN MEYER, commented on the concern. The primary reason for introduction of the bill was that there was vagueness in the statute regarding when the deferrals and taxes would have to be paid to the municipality. Amendment #2 does accomplish the intent of making certain and putting language into statute that the tax payments become due on the date set by the municipality at the time of the deferral. The municipalities, ultimately, are the ones that chose to enact the ordinance under the authority of the statute, so there is flexibility defining when the taxes are do. 4:45:33 PM Representative Hawker requested that the sponsor and Ms. Cunningham discuss the proposed language amending Amendment #2. Co-Chair Meyer advised that Amendment #2 would be set aside and that the Committee move onto Amendment #3. 4:45:54 PM Co-Chair Meyer MOVED to ADOPT Amendment #3. Vice Chair Stoltze OBJECTED. Ms. Cunningham explained that the amendment would delete the language: "An exemption or deferral may not be granted under this subsection after July 1, 2010", Page 2, Lines 12- 13. 4:48:01 PM Vice Chair Stoltze WITHDREW his OBJECTION. There being NO further OBJECTION, Amendment #3 was adopted. AT EASE: 4:48:27 PM RECONVENE: 4:54:10 PM 4:54:28 PM Representative Hawker MOVED to ADOPT a conceptual language change to Amendment #2, deleting on Page 1, Line 5, "one the date set" and inserting, "as specified"; Page 1 Line 12, and deleting "include a proposed date that" and insert, "specify when". There being NO OBJECTION, Amendment #2 was amended. Representative Kerttula pointed out that now there is no escape clause for the municipality and the party to decide anything different, other than the date of the tax payment. She maintained that there are other mechanisms to enter into some kind of an agreement over the properties. She voiced concern and asked the sponsor if that was what he wanted. Representative Hawker thought that concern was addressed in the conceptual amendment. In the amendment, the local authority is specifying what the payment triggers will be. He stressed it does not mean time or date certain. When the local authority provides the "when" clause, it would be up to them to determine it and leave the decision making power with the municipality. 4:58:26 PM Representative Ramras agreed. Representative Kerttula argued that it does not really mean, "When something happens" and is not necessarily a specific time. Additionally, she was concerned about locking the municipalities into those conditions. 4:59:38 PM Mr. Pound suggested language, Page 1, Line 5, inserting "or on a date established by an occurrence of the events". Representative Hawker advised that the original language change satisfied him. There being NO OBJECTION to the amended Amendment #2, it was adopted. Representative Foster MOVED to REPORT CS HB 334 (FIN) out of Committee with individual recommendations and with the accompanying fiscal notes. There being NO OBJECTION, it was so ordered. CS HB 334 (FIN) was reported out of Committee with a "no recommendation" and with zero note #1 by the Department of Commerce, Community & Economic Development and a new zero note by the Office of Management and Budget.