Legislature(2017 - 2018)ADAMS ROOM 519

04/17/2018 09:00 AM House FINANCE

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Recessed to a Call of the Chair --
<Bill Hearing Canceled>
-- Public Testimony --
Moved CSSB 185(EDC) Out of Committee
-- Public Testimony --
Heard & Held
-- Public Testimony --
Moved CSHB 409(FIN) Out of Committee
-- Public Testimony --
+ Bills Previously Heard/Scheduled TELECONFERENCED
Heard & Held
Moved HCS CSSB 92(FIN) Out of Committee
CS FOR SENATE BILL NO. 92(FIN) am                                                                                             
     "An  Act relating  to abandoned  and derelict  vessels;                                                                    
     relating to  the registration  of vessels;  relating to                                                                    
     certificates  of title  for  vessels;  relating to  the                                                                    
     duties  of the  Department of  Administration; relating                                                                    
     to the  duties of the Department  of Natural Resources;                                                                    
     establishing  the derelict  vessel prevention  program;                                                                    
     establishing  the  derelict vessel  prevention  program                                                                    
     fund; relating  to the authority of  certain persons to                                                                    
     enforce   laws  relating   to  derelict   vessels;  and                                                                    
     providing for an effective date."                                                                                          
12:53:00 PM                                                                                                                   
Co-Chair Foster asked Co-Chair Seaton's staff to review the                                                                     
changes in the committee substitute (CS).                                                                                       
12:53:30 PM                                                                                                                   
ELIZABETH  DIAMENT,   STAFF,  REPRESENTATIVE   PAUL  SEATON,                                                                    
highlighted the changes in the  CS ["Explanation of Changes:                                                                    
CSSB  92 (FIN)Version  I.A to  House Finance  CS for  CSSB92                                                                    
(FIN) Version M (copy on file)]:                                                                                                
     Section 7 (page 4, line 23)                                                                                                
     Definition of Barge                                                                                                        
     In SB  92 Version  I.A "barge" is  defined as  a "flat-                                                                    
     bottomed boat used for carrying  freight that is either                                                                    
     nonmotorized and towed by another boat or motorized."                                                                      
     In the  CS for  CSSB92 (FIN)  Version M  the definition                                                                    
     has been changed  to "barge" means a boat  that is: (A)                                                                    
     motorized or  nonmotorized, (B)  designed to  be towed,                                                                    
     and (C) used for carrying freight.                                                                                         
     Note: The  main difference reflected is  the removal of                                                                    
     the  flat-bottomed  boat  portion  of  the  definition.                                                                    
     There  was some  concern that  definition from  CSSB 92                                                                    
     Version I.A  could misinterpret a flat  bottom skiff as                                                                    
     a barge.                                                                                                                   
     Section 24 (page 14, line 30)                                                                                              
     Instead of  repealing Chapter  30. Article  03. Vessels                                                                    
     Abandoned on  Business Premises  of Persons  Engaged in                                                                    
     Repair  Business, the  CS for  CSSB92  (FIN) version  M                                                                    
     keeps  the article  in  statute and  amends  it to  add                                                                    
     storage businesses,  as well  as extending  the waiting                                                                    
     period for auctioning abandoned vessels from 5 days to                                                                     
     30 days.                                                                                                                   
     Note: The  change from 5  to 30  days was in  the house                                                                    
     companion  bill which  did not  repeal but  amended the                                                                    
     section to  be in line  with the timeframe laid  out in                                                                    
     other sections of the bill.                                                                                                
12:55:07 PM                                                                                                                   
Co-Chair   Seaton   MOVED   to  ADOPT   proposed   committee                                                                    
substitute  for  CSSB   92(FIN)am,  Work  Draft  30-LS0481\M                                                                    
(Bruce,  4/17/18).  There  being  NO OBJECTION,  it  was  so                                                                    
Representative Ortiz asked where  he could find the language                                                                    
pertaining to an exemption for boats up to 24 feet long.                                                                        
Co-Chair Seaton directed attention to page 3, line 30.                                                                          
Ms. Diament confirmed  the language was on page  3, line 30,                                                                    
subsection  (f):   "This  section  does  not   apply  to  an                                                                    
undocumented boat that is 24  feet or less in length, unless                                                                    
the owner of the boat chooses to apply..."                                                                                      
Representative  Ortiz wondered  if  vehicles were  currently                                                                    
exempt from  registering or titling  in rural  areas without                                                                    
access to Division  of Motor Vehicles (DMV)  offices. If so,                                                                    
he asked  if the  exemption was  maintained for  boats under                                                                    
the legislation.                                                                                                                
Ms. Diament deferred to the bill sponsor's staff.                                                                               
RACHEL HANKE,  STAFF, SENATOR  PETER MICCICHE,  replied that                                                                    
she  could follow  up with  the  information after  speaking                                                                    
with DMV.                                                                                                                       
Co-Chair Seaton  believed 24 foot  boats were exempt  in any                                                                    
location. He stated that vessels  operating on inland waters                                                                    
were required to be registered.                                                                                                 
12:58:29 PM                                                                                                                   
Representative  Ortiz  believed  that  current  titling  and                                                                    
registration  requirements for  vehicles  in outlying  areas                                                                    
were  exempt. If  there  was an  exemption  for vehicles  in                                                                    
rural areas without access to  DMV, he wondered if there was                                                                    
an exemption for all boat owners.                                                                                               
Co-Chair Seaton  believed if there  was an exemption  it was                                                                    
not due  to lack  of access  to DMV,  but due  to a  lack of                                                                    
access to  roads with state  maintenance. He  believed there                                                                    
was  a registration  exemption on  vehicles not  operated on                                                                    
any public road.                                                                                                                
Representative  Ortiz asked  for verification  that Co-Chair                                                                    
Seaton believed that the issue  was not about lack of access                                                                    
to  DMV  offices, but  was  related  to  being on  the  road                                                                    
Co-Chair Seaton  added that registration  with DMV  could be                                                                    
accessed  via  mail.  He  noted  some  areas  may  not  have                                                                    
internet, but there was phone and mail access.                                                                                  
Ms. Diament added that DMV would provide a written answer.                                                                      
Representative  Kawasaki stated  that Section  4 dealt  with                                                                    
inadequate  evidence of  ownership. He  stated a  person was                                                                    
supposed  to   obtain  documentation   to  present   to  the                                                                    
Department of Administration (DOA)  as proof of ownership of                                                                    
a boat. He asked if it  was the same way people licensed and                                                                    
registered their cars.                                                                                                          
Ms.  Hanke  responded  that   DMV  considered  current  boat                                                                    
registration  as  proof  of ownership,  which  was  slightly                                                                    
different than vehicles.                                                                                                        
1:01:17 PM                                                                                                                    
Representative Kawasaki was concerned  they could be getting                                                                    
to a point  where statute designated a  person had ownership                                                                    
of  a boat,  even though  they  may not  have ownership.  He                                                                    
referenced  Section  4(c)(2),  which  specified  if  it  was                                                                    
uncontested for  three years following  the issuance  of the                                                                    
"no title  issued" registration that  a person  could become                                                                    
the owner of  record even though they may not  have been the                                                                    
owner  of  record.  He  asked  if  the  issue  had  come  up                                                                    
Ms. Ranke  responded that someone  could currently go  in to                                                                    
DMV  with  a  bar  napkin  as  a  bill  of  sale  to  get  a                                                                    
registration.  After starting  to  issue the  titles with  a                                                                    
sale and initial titling would  use current registrations as                                                                    
proof  of  ownership. She  supposed  it  could be  happening                                                                    
1:02:37 PM                                                                                                                    
Representative   Kawasaki  referenced   the  exemption   for                                                                    
undocumented boats  that were 24  feet or less.  He wondered                                                                    
how 24 feet had been chosen.                                                                                                    
Ms. Hanke  replied that she  would have  to get back  to the                                                                    
Representative Wilson thought  a boat had to  be larger than                                                                    
24 feet and commercial.                                                                                                         
Ms.  Diament  responded  that  the  language  Representative                                                                    
Wilson was  referencing was in  the house companion  bill HB
386, whereas,  SB 92 only contained  a length determination.                                                                    
She explained boats  that were 24 feet or  less were exempt;                                                                    
boats over 24 feet would require a title.                                                                                       
Representative Wilson  asked how  many 25-foot  personal use                                                                    
boats there  were that would  have to register.  She thought                                                                    
the  problem pertained  to  commercial  boats, not  personal                                                                    
boats. She wondered why the change had been made.                                                                               
1:04:09 PM                                                                                                                    
Co-Chair Seaton  responded that the 20-foot  length was used                                                                    
because it was  considered fairly easy to  dispose of. Boats                                                                    
over 24  feet had built in  fuel tanks and other  things. He                                                                    
stated  there was  generally a  length and  width ratio.  He                                                                    
continued  it became  a larger  problem. The  exemption used                                                                    
[by the House  version] had been for  non-commercial so that                                                                    
commercial  vessels  under 20  feet  would  still require  a                                                                    
title,  but  that  had  not  been in  the  Senate  bill.  He                                                                    
continued  that   the  provisions  considered  what   was  a                                                                    
reasonable amount.  He asked his  staff for number  of boats                                                                    
excluded pertaining to difference between 20 and 24 feet.                                                                       
Ms.  Diament  relayed  that there  were  about  9,100  boats                                                                    
between 20 and 25 feet that were exempt.                                                                                        
Co-Chair Seaton explained the  consideration was a balancing                                                                    
act  around  what  qualified  as  something  that  could  be                                                                    
abandoned,  but  would  need  to  be  taken  care  of  by  a                                                                    
different mechanism; it was the  reason for the length of 24                                                                    
feet  suggested by  the  Senate. He  stated  that the  House                                                                    
version of  the bill  had used  20 feet,  but it  had agreed                                                                    
with the Senate.                                                                                                                
Representative Wilson pointed out  the 9,000 boats mentioned                                                                    
by Ms.  Diament pertained to  boats between 20 and  25 feet,                                                                    
not  20 and  24 feet.  She  asked if  her understanding  was                                                                    
Ms. Diament replied  that the current language  was 24 feet.                                                                    
She stated the  bill related to boats that were  20 feet and                                                                    
under or 24 feet and under.  She explained it would be under                                                                    
25 feet.                                                                                                                        
Representative Wilson  restated her question.  She explained                                                                    
that Ms.  Diament had previously provided  information about                                                                    
the number of boats between 20 and 25 feet.                                                                                     
Ms. Diament  corrected her previous testimony  and clarified                                                                    
that the [9,100] boats were between 20 and 24 feet.                                                                             
1:06:23 PM                                                                                                                    
Vice-Chair Gara  reviewed the four fiscal  notes. There were                                                                    
two  zero  fiscal  notes  from  the  Department  of  Natural                                                                    
Resources and  the Department of  Environmental Conservation                                                                    
(OMB Component  Numbers 3002  and 3094  respectively). There                                                                    
was one Department of  Natural Resources fund capitalization                                                                    
fiscal  note  for  funds  from   fees  generated  under  the                                                                    
legislation - fees would  generate roughly $58,600 beginning                                                                    
in  2020   and  would   decline  after   registrations  were                                                                    
completed  to $30,000  in 2022  and  to $2,500  in 2023  and                                                                    
2024.   The   last  note   was   from   the  Department   of                                                                    
Administration  (OMB Component  Number 2348)  DMV reflecting                                                                    
fee  generation of  $65,000, declining  to $50,000  in 2020.                                                                    
The note reflected additional  designated general fund (DGF)                                                                    
revenues from fees beginning at  $64,100 in 2019, increasing                                                                    
to $108,600  in 2020 and  2021, $80,500 in 2022,  $52,500 in                                                                    
2023  and 2024.  Undesignated  general  fund (UGF)  revenues                                                                    
were projected at $19,600 starting in 2020.                                                                                     
1:09:16 PM                                                                                                                    
Representative Wilson  referred to page 2  of the Department                                                                    
of Administration  fiscal note  (OMB Component  Number 2348)                                                                    
related to title  and barge fees. The  fiscal note specified                                                                    
there  were over  68,000 motorized  boats registered  in the                                                                    
State of  Alaska, of which  8,418 are  25 feet and  over. It                                                                    
also specified  that a title fee  of $20 for boats  above 24                                                                    
feet would  generate approximately  $168,360. She  asked why                                                                    
the language  used 25 feet  in one  sentence and 24  feet in                                                                    
MARLA  THOMPSON,  DIRECTOR,   DIVISION  OF  MOTOR  VEHICLES,                                                                    
DEPARTMENT OF ADMINISTRATION,  (via teleconference), replied                                                                    
the language was  merely an error. The  language should read                                                                    
"25 feet and above."                                                                                                            
Representative  Wilson  asked   for  verification  that  the                                                                    
reference to 24 feet should be changed to 25.                                                                                   
Co-Chair Foster replied in the affirmative.                                                                                     
Representative  Ortiz  asked  about   the  fiscal  note  OMB                                                                    
Component Number  2348. He wondered  if the fiscal  note had                                                                    
been changed  since the boat  exemption had changed  from 20                                                                    
feet to  24 feet.  He believed there  would be  less revenue                                                                    
with the inclusion of the exemption.                                                                                            
Ms.  Thomson responded  that the  fiscal note  reflected the                                                                    
Co-Chair  Seaton  noted  there  had been  a  question  about                                                                    
numbering of documented vessels. He  read from a response he                                                                    
had   received  to   the  question:   "states  may   require                                                                    
documented  vessels  to be  registered  and  to display  the                                                                    
state  decal  showing that  they  have  complied with  state                                                                    
requirements."  However,   there  was  some   dispute  about                                                                    
whether vessels could be renumbered.  The bill specified the                                                                    
same  numbers  would be  used  in  titling  as used  in  the                                                                    
documentation.  He noted  that the  Coast Guard  was present                                                                    
for  questions.   Apparently  other  states  had   the  same                                                                    
1:12:17 PM                                                                                                                    
Co-Chair  Seaton MOVED  to report  HCS CSSB  92(FIN) out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
HCS CSSB  92(FIN) was REPORTED  out of committee with  a "no                                                                    
recommendation"  recommendation  and  with  one  new  fiscal                                                                    
impact note  from the Department of  Administration; one new                                                                    
fiscal impact note from the  Department of Natural Resources                                                                    
for Fund  Capitalization; and two previously  published zero                                                                    
notes: FN3 (DEC) and FN4 (DNR).                                                                                                 
1:12:57 PM                                                                                                                    
AT EASE                                                                                                                         
1:13:15 PM                                                                                                                    

Document Name Date/Time Subjects
HB119 Sectional Analysis ver A 3.28.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 119
HB 119 Supporting Documents Presentation Slides 3.27.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 119
HB119 Supporting Documents - AIDEA GASB Examples 03.27.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 119
HB119 Supporting Documents - AIDEA Historic Dividend Comparison Existing to Proposed 03.27.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 119
SB185 Sponsor Statement 4.14.2018.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
SB185 Sectional Analysis ver. D.PDF HFIN 4/17/2018 9:00:00 AM
SB 185
SB185 Explanation of Changes Ver. A to Ver. D 4.14.2018.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
SB185 Support Doc - Fiscal Note Explanation Graphic 4.14.2018.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
SB185 Support Doc - 10 Year Utilization Summary 4.14.2018.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
HB 409 Sponsor Statement 4.16.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 409
HB409 Sectional Analysis 4.16.18.pdf HFIN 4/17/2018 9:00:00 AM
HB 409
SB 92 Explanation of changes Ver I.A to Ver M.pdf HFIN 4/17/2018 9:00:00 AM
SB 92
SB 92 HCS WORKDRAFT vM.pdf HFIN 4/17/2018 9:00:00 AM
SB 92
SB 185 Matt Moser Testimony NEA.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
SB 185 Supporting Document Conduent .pdf HFIN 4/17/2018 9:00:00 AM
SB 185
SB 185 Supporting Document Retention.pdf HFIN 4/17/2018 9:00:00 AM
SB 185
CSSB 105(FIN) DHSS' Alaska ER Report_2017.pdf HFIN 4/17/2018 9:00:00 AM
SB 105