HB 10-NONCOMMERCIAL TRAILER REGISTRATION FEE  1:08:07 PM CHAIR P. WILSON announced that the first only order of business would be HOUSE BILL NO. 10, "An Act relating to the registration fee for noncommercial trailers and to the motor vehicle tax for trailers." 1:08:24 PM DARRELL BREESE, Staff, Representative Bill Stoltze, Alaska State Legislature, on behalf of the prime sponsor of HB 10, Representative Bill Stoltze, explained that HB 10 relates to registration fees for noncommercial trailers. During the 20th Legislature the legislature passed a bill granting permanent trailer registration for commercial trailer owners. This bill would offer the same permanent registration to consumers and owner of noncommercial trailers. MR. BREESE offered one secondary effect should provide additional efficiency and help streamline the Division of Motor Vehicles (DMV) processing of trailer registrations. He remarked that another measure before the legislature would also offer similar changes to motor vehicles. He pointed out that this bill would still allow noncommercial trailer owners to opt to use the biennial registration method to pay fees rather than the permanent registration. CHAIR P. WILSON, in response to Representative Gruenberg, clarified that the bill heard by the House State Affairs Standing Committee technically was not a companion bill since that bill refers to motor vehicles. 1:11:15 PM MR. BREESE, in response to Chair P. Wilson, agreed that the fees would increase to $100 for the permanent registration of noncommercial trailers. He explained the process to determine the registration fee amount. The sponsor's goal attempts to cover costs by projecting an estimated cost for someone who has owned a trailer for 10 years. Thus, the fees included in this bill would probably be close to $100. He further explained that the DMV did not project the number of trailers that these fees may apply to since people often register a trailer, park it, and only re-register the trailer when the owner needs to use the trailer again. This is unlike a car since people tend to keep their vehicles currently registered. While using a 10 year ownership seemed reasonable the fees in HB 10 are not based on any statistical data. In response to Chair Wilson, he reported that commercial vehicle registration fees currently are a one- time $20 fee. He related his understanding that the intent of the enabling legislation for commercial trailers are also based on the owner paying increased taxes and higher fees for the truck operation. However, noncommercial trailer fees were not adjusted since no additional taxes are associated with the fees. In further response to Chair Wilson, he answered that the fees for commercial trailers are a flat $20 fee and are not based on the number of axles. 1:14:17 PM REPRESENTATIVE FEIGE asked for DMV's costs to register one trailer. MR. BREESE said he was unsure. CHAIR P. WILSON noted that someone from the DMV would be testifying later who could answer that question. 1:14:41 PM REPRESENTATIVE GRUENBERG referred to page 3, line 18 of HB 10. He asked which statutes are being repealed in this subsection. MR. BREESE referred to page 3, lines 2-4 of HB 10. He said that this language is being reinserted in another part of the statute. REPRESENTATIVE GRUENBERG asked for clarification on the fees. He asked whether the fees for noncommercial vehicles on page 3, line 1 of HB 10 would apply if the person decided to pay the biennial fees. If the person decided to apply for permanent registration fees, the fees listed on page 3, line 14 of HB 10 would apply. He offered his belief that the permanent one-time fee would be $51 as opposed to $17 for an annual fee. MR. BREESE, referred to page 2, beginning on line 13 of the bill to the chart, "Tax According to Age of Vehicle." He advised that the chart calculates the taxes for the vehicle depending on the vehicle's age. The fee for a vehicle, such as a motorcycle [line 19] would be $17 in the first year but would drop to $4 in the eighth year. He agreed that the biennial registration for every year past the eighth year would be $4 for a motorcycle. He also agreed that on page 3, line 14 of HB 10, the fee of $51 refers to the permanent one-time fee. 1:17:20 PM REPRESENTATIVE MUNOZ asked why the fee structure for commercial fees is different than those for noncommercial vehicles. MR. BREESE explained that owners of commercial vehicles currently pay a higher tax registration and tax rate based on the weight of the vehicle and the number of axles. He stated that the flat fee for noncommercial vehicles is a structure that was used in the enabling legislation. This bill is consistent with the enabling legislation, which is to charge the bulk of the fees for a commercial vehicle rather than to charge a fee for the vehicle being towed. An owner is already paying registration fees for his/her truck so an extra charge would not be passed on for the vehicle registration in this bill. 1:18:27 PM REPRESENTATIVE MUNOZ asked whether the analogy would also be the same for noncommercial vehicles. MR. BREESE agreed that some consistency would be achieved, but to be perfectly consistent would require rewriting the whole section for non-commercial vehicles and "that's a bigger pie than we were trying to cut at this time," he said. 1:18:59 PM REPRESENTATIVE GRUENBERG referred to the title, which is "An Act relating to the registration fee for noncommercial trailers and to the motor vehicle tax for trailers." He referred to page 1, lines 12-14, to proposed Section 2 of HB 10, which applies only to noncommercial trailers. He reiterated that subsection (j) refers only to noncommercial vehicles. MR. BREESE answered that subsection (j) reads, "When a person registers a trailer not used or maintained for the transportation of person or property for hire or for other commercial use..." He explained that this subsection means that if the purpose is not for commercial use that this provision would apply. REPRESENTATIVE GRUENBERG agreed, noting the language is a double negative, so he initially missed the intent. 1:20:24 PM WHITNEY BREWSTER, Director, Division of Motor Vehicles (DMV), Department of Administration (DOA), addressed an earlier question by Representative Feige. She responded that she did not have a definitive answer to how much it costs the agency to process a trailer renewal but she estimated the staff time for a renewal transaction would be about three minutes. She thought an initial registration transaction may take about seven minutes to complete. She pointed out the clerks processing these transactions fall in the payroll ranges of range 10-12. She estimated the time needed to process noncommercial trailers would be included as part of the scope of their regular job duties. She explained that online transactions cost the state about $1 per transaction and including the credit card fees charged would amount to two percent of the total transaction. Thus, transaction fees would cost about $2 on noncommercial trailer registration fees of $30. In response to Chair P. Wilson, she answered that the motor vehicle fees collected are deposited to the general fund. In further response to Chair P. Wilson, she agreed that the revenue collected would increase in the first two years and then would decrease every year thereafter. 1:23:39 PM REPRESENTATIVE FEIGE asked how many trailer applications were anticipated per year. MS. BREWSTER answered that the DMV processes about 5,000 new trailer applications per year. In further response to Representative Feige, she responded that due to the small numbers of registrations, the DMV does not anticipate a decrease or reduction in staff levels. 1:24:37 PM CHAIR P. WILSON recalled that the DMV's costs of operation are taken directly from the revenue it collects. MS. BREWSTER responded that the DMV is a receipt-supported services organization, which means that the DMV's funding is based on the amount of revenue it generates. In response to Chair P. Wilson, she explained that the DMV operates on an annual amount of $16.5 million. The proposed bill would not sufficiently impact the DMV to affect its operating funds. She added that the DMV's receives approximately $68.5 million annually in total revenue. 1:26:37 PM MS. BREWSTER advised that this program would be a fairly simple program to administer at the DMV. In response to Representative Johnson, she answered that the DMV is neutral on HB 10. MARC LUIKEN, Commissioner, Department of Transportation & Public Facilities (DOT&PF), stated the Department of Transportation & Public Facilities (DOT&PF) does not have a position on HB 10 at this time. 1:28:00 PM CHAIR P. WILSON after first determining no one else wished to testify closed public testimony on HB 10. She explained that the bill would be discussed at a subsequent hearing. 1:28:41 PM