CS FOR HOUSE BILL NO. 67(FIN) am "An Act relating to a mandatory exemption from municipal property taxes for certain college property, to a mandatory exemption from municipal property taxes for residences of certain widows or widowers, and to optional exemptions from municipal property taxes for property of certain fraternal organizations and for certain residences of law enforcement officers; and providing for an effective date." REPRESENTATIVE GRUENBERG, CO-SPONSOR, addressed HB 67. Rep. Gruenburg referred to HB 67 as the "cop in the neighborhood" bill. The provision allows a municipality to provide an exemption from municipal property taxes for peace officers who move into a high crime neighborhood. He maintained that having an officer in the neighborhood is a crime deterrent. He outlined the sections of the bill: Sec. 1 extends the disabled veteran property tax exemptions to widows and widowers of peace officers. He noted the definitions used for this are the same as those in SB 204. Sec. 2 added by Senator Thomas expands the optional municipal tax exemption for residences to 40,000. Sec. 3 was added by Representative Meyer. Originally the exemption was mandatory. This was changed to optional to allow municipalities to exempt property of a private none profit four year college or university that is accredited that is not subject to the mandatory exemption. He added that other taxing provisions would still apply. Representative Gruenberg noted that section 3 is important to a facility located on the Alaska Pacific University campus. Sec. 4 provides the option for municipalities to exempt religious, charitable, education, scientific, literary, and fraternal organizations. Representative Gruenburg explained that many of the facilities are used as a meeting place and serve the entire communities. Representative Gruenburg purported that HB 67 has served as a repository for many tax relief provisions. He urged the Committee to pass HB 67 because it provides property tax relief to a wide variety of people and organizations. Senator Elton asked how the tax exemption effects "full and true value" that is applied to the school funding formula. Representative Gruenburg was not certain. He explained that the exemption may trigger a round of additional assessments or trigger the municipality to look at the rest of it's taxing structure. 10:50:17 AM Mr. Van Sant explained that HB 67 deals with optional exemptions and has no revenue impact to the State. He addressed the question regarding the full value determination. Any optional exemption, authorized by a municipality is put back into the full value, and would thereby not effect school funding. "If a municipality's full value is $100 and they exempt optionally a fraternal organization, for example, those are put back in so the full value will remain $100 even though the local assessed value may be $85." The full value will not be effected by this. For school funding purposes the 4 mills would be based on $100 rather than $85. He reiterated that because these are all optional exemptions it would not have an impact on the State. Mr. Van Sant added a clarification: Sec. 1 does not extend the exemption to widowers; it clarifies that it removes the age requirement. The language combines the criteria for disabled veterans and widowers. The language is removed so that there is no age restriction for veterans. 10:52:38 AM Rep. Gruenburg said the effective date needed to change because, if HB 67 was enacted now, the effective date would be retroactive. Co-Chair Stedman MOVED to ADOPT Amendment 1, 25-LS0314/J.2 Cook, 2/19/08. Co-Chair Stedman OBJECTED for purposes of clarification. REPRESENTATIVE CHENAULT, Co-Sponsor, explained that the amendment allows for boroughs, to charge cities inside the borough, for collecting a tax that is not uniform to the borough. The amendment provides for the borough to charge a fee to pay for purchases necessary for tax collection. Co-Chair Stedman WITHDREW his OBJECTION. There being NO OBJECTION, Amendment 1 was adopted. Senator Dyson asked if there would be efforts to combine legislation dealing with tax exemptions. 10:55:19 AM Co-Chair Stedman stated the intention was to provide an opportunity for discussion on various proposed legislation dealing with property tax exemption. Senator Dyson supported combining the tax exemption legislation. Co-Chair Stedman said the provision may fit into a long-term fiscal bill. HB 67 was Heard and HELD in Committee for further consideration.