SENATE BILL NO. 22                                                                                                            
                                                                                                                                
     "An Act relating to the collection costs for the                                                                           
     municipal   motor   vehicle    registration   tax;   and                                                                   
     providing for an effective date."                                                                                          
                                                                                                                                
2:36:47 PM                                                                                                                    
                                                                                                                                
SENATOR  CATHY GIESSEL,  SPONSOR,  introduced  the bill.  She                                                                   
explained  that  since the  inception  of the  motor  vehicle                                                                   
registration tax  system in 1993,  the cost to the  state (in                                                                   
collecting  taxes   for  municipalities)  had   been  reduced                                                                   
considerably,  while  the  rate charged  to  communities  had                                                                   
not.  SB 22  proposed to  reduce  the amount  that the  state                                                                   
collected  from   each  community  that  signed   on  to  the                                                                   
program. She directed  attention to the second page  of FN 1,                                                                   
and discussed  the list of  communities in which  local motor                                                                   
vehicle taxes  were collected and  8 percent was  retained by                                                                   
the  state. She  pointed  out that  the  communities did  not                                                                   
incur  8   percent  cost  to   conduct  the  tax   collecting                                                                   
activity,   and    the   bill   proposed   to    reduce   the                                                                   
administrative  fee to 5.5 percent.  The proposed  amount was                                                                   
more closely calculated  to the actual cost  for the Division                                                                   
of Motor  Vehicles (DMV). She  emphasized that there  were no                                                                   
new  costs or  fees  to the  state, and  the  bill left  more                                                                   
money in the communities.                                                                                                       
                                                                                                                                
Co-Chair MacKinnon OPENED public testimony.                                                                                     
                                                                                                                                
2:39:35 PM                                                                                                                    
                                                                                                                                
DANIEL   MOORE,   TREASURER,   MUNICIPALITY   OF   ANCHORAGE,                                                                   
ANCHORAGE (via  teleconference), testified in support  of the                                                                   
bill.  He   related  that  in   2012,  the  Municipality   of                                                                   
Anchorage increased  its rate schedule for the  motor vehicle                                                                   
registration  program,  almost doubling  the  rates to  match                                                                   
the  rates  of  Mat-Su.  He  described  the  disproportionate                                                                   
administrative  costs   of  the  tax  collection   after  the                                                                   
dramatic increase  in fees, despite  the fact that  the scope                                                                   
of work  was unchanged.  He estimated  that the  Municipality                                                                   
of  Anchorage was  paying  the DMV  about  $500,000 more  per                                                                   
year  than  it  had  in  prior   years.  He  added  that  the                                                                   
Anchorage area had  45 percent of all registered  vehicles in                                                                   
the  state, and  prior  to 2012  it paid  45  percent of  the                                                                   
administrative  cost  to  DMV.   Due  to  the  rate  schedule                                                                   
update,  the municipality  currently paid  59 percent  of the                                                                   
administrative  cost. By changing  the statutory rate  from 8                                                                   
percent  to 5.5  percent,  the new  payment  amount would  be                                                                   
proportionate and  benefit the participating  communities. He                                                                   
estimated  the each  community  would  gain about  3  percent                                                                   
additional  revenue  if  the bill  successfully  passed  into                                                                   
law.                                                                                                                            
                                                                                                                                
2:42:02 PM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon CLOSED public testimony.                                                                                     
                                                                                                                                
Co-Chair   MacKinnon  reiterated   that  the  committee   was                                                                   
working  on the  capital budget,  and would  stand in  recess                                                                   
until later in the day.                                                                                                         
                                                                                                                                
SB  22   was  HEARD  and   HELD  in  committee   for  further                                                                   
consideration.                                                                                                                  
                                                                                                                                
2:42:55 PM                                                                                                                    
RECESSED                                                                                                                        
                                                                                                                                
8:50:51 PM                                                                                                                    
RECONVENED