HB 162-FEES: BUSINESS LICENSE & RECORDING CHAIR ROKEBERG announced that the next order of business would be HOUSE BILL NO. 162, "An Act increasing the fee for a state business license; and providing for an effective date." Number 358 REPRESENTATIVE KOTT moved that the committee adopt Amendment 1, which reads as follows: Page 2, lines 7-14: Delete all material and insert: "(a) The [LICENSE] fee for each business license is $100 [$25] per year, except that the fee is  $50 if (1) the business is a sole  proprietorship; and (2) the sole proprietor is 65 years of  age or older when the sole proprietor applies for the  license or will reach 64 years of age at any time  during the year for which the license is issued. REPRESENTATIVE KOTT explained that Amendment 1 would lower the proposed fee for a business license from $300 a year to $100 a year. Therefore, this increase would be equitable because business license fees would be increased for both sole proprietors and any other partnerships or corporations that would be licensed under the chapter. Furthermore, increasing the business license from the existing $25 to $300 a year is too much of an increase. Amendment 1 also provides a provision that those 65 years of age or older would pay $50 for the business license. Number 338 REPRESENTATIVE McGUIRE inquired as to the difference Amendment 1 will make regarding the revenues captured. REPRESENTATIVE KOTT acknowledged that under Amendment 1 a smaller amount of revenue would be generated than under the current legislation. He indicated that a document, included in the committee packet, specified the difference in the amount of revenue generated by a $100 business license fee versus a $300 fee. REPRESENTATIVE McGUIRE remarked that she believes the senior business owner provision is a good idea. However, she inquired as to why there isn't an exemption for younger business owners. REPRESENTATIVE KOTT remarked that such an idea could be entertained. He explained that he had included the senior business owner exemption due to the possible disadvantage seniors face in various areas. He related his belief that the younger business owners would have a greater earning opportunity than those 65 or over. REPRESENTATIVE McGUIRE said she didn't disagree. However, she said she believes the current $25 business license, albeit low, has encouraged people to take risks. CHAIR ROKEBERG clarified that Amendment 1 would change the $300 business license fee in HB 162 to $100 for everyone and provide seniors with an additional break in that their business license fee would be $50. Chair Rokeberg noted that he will request a new fiscal note if Amendment 1 passes. Number 288 RICK URION, Director, Division of Occupational Licensing, Department of Community & Economic Development (DCED), explained that a new fiscal note from the division would show a change in revenue of about $4.2 million. He clarified that the $4.2 million includes a drop-out rate. A $100 business license fee, with no drop-outs would result in a change in revenue of about $5.2 million. REPRESENTATIVE KOTT related his understanding then that Mr. Urion's original analysis for a business license fee of $300 considered drop-outs. MR. URION answered that a 25 percent drop-out rate was considered at the $100 level for sole proprietorships. REPRESENTATIVE BERKOWITZ inquired as to the fees in other states. MR. URION responded that most business license fees in other states are higher than Alaska. Number 267 REPRESENTATIVES KOTT, BERKOWITZ, and ROKEBERG all noted a conflict of interest due to owning various types of businesses. CHAIR ROKEBERG reminded the committee that the motion to adopt Amendment 1 was before the committee. There being no objection, Amendment 1 was adopted. Number 253 REPRESENTATIVE COGHILL moved to report CSHB 162(FIN) as amended out of committee with individual recommendations and the accompanying and forthcoming fiscal notes. REPRESENTATIVE BERKOWITZ objected. A roll call vote was taken. Representatives Kott, Coghill, McGuire, Morgan, and Rokeberg voted in favor of reporting CSHB 162(RLS) from committee. Representative Berkowitz voted against it. Therefore, CSHB 162(RLS) was reported out of the House Rules Standing Committee by a vote of 5-1.