HB 341 TAX APPEALS/ASSESSMENT/LEVY/COLLECTION  CHAIRMAN TAYLOR announced a committee substitute has been prepared that incorporates the amendments adopted at the last meeting, however the working group, consisting of representatives from the Administration, industry, and Representative Green's staff, have come up with further amendments to present. DEBORAH VOGT, Deputy Commissioner of the Department of Revenue, explained the proposed amendments. The first amendment (work draft D) would permit a very limited appeal directly to court, or situations in which a taxpayer is challenging the validity of a statute for specific reasons. An appeal would be prohibited if there is a dispute of material fact that a factfinder would have to develop if a factual record is necessary to decide the question of law that is raised, if the development of a factual record will render an appeal unnecessary to reach the question of law raised, or if the taxpayer challenges the assessment of the tax on grounds other than the validity of the statute. This procedure would be used by the court system anyway. Number 574 SENATOR ADAMS questioned whether the time limit for payment made on page 3 is 30 or 60 days. MS. VOGT believed it should be 60 days and is a drafting error. In the original bill the requirement was 30 days, but Paul Frankel recommended lengthening the time limit to 60 days. CHAIRMAN TAYLOR noted the transitional provision has also been changed. MS. VOGT agreed and explained amendment #2 provides that if the taxpayer appeals after the effective date of the act, the appeal goes to the new administrative law judge, rather then staying within the department. Cases currently pending in the department will remain so, until resolved, unless both parties agree otherwise. CHAIRMAN TAYLOR asked whether the prepay requirement, adopted at Monday's meeting, will no longer be part of the transition requirement. MS. VOGT stated that is correct. CHAIRMAN TAYLOR questioned whether this transition amendment is slightly different in that it no longer offers an opt-in, opt-out provision. MS. VOGT clarified the option is no longer unilateral: A taxpayer cannot opt out without the state's permission. CHAIRMAN TAYLOR asked if the third and more significant change is the change from a direct-to-court option to a more definitive discussion of the subject matter that would be allowed to be argued in Superior Court. That discussion has been narrowed to issues of law, and not issues of fact or interpretation. MS. VOGT explained the discussion would have to focus on issues of law that would invalidate a statute. CHAIRMAN TAYLOR concluded the direct-to- court option has been limited to summary judgment motions. MS. VOGT explained, for the record, the group discussed the prepayment provision which she was adamantly in favor of retaining, but was later convinced that if a taxpayer is going to challenge the validity of a statute, the fact that the taxpayer will have already paid the undisputed amount of the tax is an appropriate approach. CHAIRMAN TAYLOR asked if the Administration supports the legislation if these amendments are adopted. MS. VOGT replied affirmatively. JEFF LOGAN, legislative aide to Representative Joe Green, sponsor of the measure, stated he appreciated the additional time given to the bill. He informed committee members that Representative Green spoke to Governor Knowles after Monday's meeting about the amendments discussed by Ms. Vogt. He was disappointed that he could not convince the Governor of his point of view, however he is willing to accept the proposed changes which were the result of another meeting with members of his administration and AOGA members. Representative Green would have preferred an unlimited option of going straight to court, or an option that requires prepayment, but is willing to see how this approach works for one or two years. TERRY CARNES, Alaska Judicial Council, commented that if the committee adopts the amendment regarding the appointment of administrative law judges requiring the participation of the Judicial Council, the Judicial Council concurs with that approach. She submitted a $13,000 fiscal note which covers the expense of appointing a single administrative judge. The Judicial Council does believe it would be appropriate to conduct an in-house Bar survey on the position, so the associated costs would cover a meeting of the Judicial Council to interview the candidates and make nominations, and to conduct a Bar survey. CHAIRMAN TAYLOR commented the bill has a referral to the Senate Finance Committee where the fiscal impact will be discussed. This position will be weighing matters that are of greater significance than normally seen in the Superior Courts. MS. CARNES believed it is appropriate to go through a very detailed, thorough selection process. SENATOR GREEN moved the adoption of the proposed amendments discussed by Ms. Vogt as one amendment to HB 341. There being no objection, the motion carried. There being no further discussion on the bill, SENATOR MILLER moved HB 341 as amended out of committee with individual recommendations with any accompanying fiscal notes. There being no objection, the motion carried. SENATOR ADAMS thanked the Chairman for making a bad bill good. CHAIRMAN TAYLOR thanked everyone who worked on the bill as this version is a much preferred product. MS. VOGT noted the Department has prepared a draft fiscal note to address the amendments that were adopted. CHAIRMAN TAYLOR asked her to submit it to the committee so that it can travel with the bill.