Legislature(2015 - 2016)BARNES 124
03/16/2016 03:15 PM House LABOR & COMMERCE
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HB 337-MARIJUANA TAXES;EXCESS POSSESSION;BONDS 3:47:52 PM CHAIR OLSON announced that the next order of business would be HOUSE BILL NO. 337, "An Act relating to taxes on marijuana." 3:48:13 PM REPRESENTATIVE HUGHES moved to adopt the proposed committee substitute (CS) for HB 337, labeled 29-LS1490\H, Nauman, 3/10/16, as the working document. CHAIR OLSON objected for discussion purposes. 3:48:32 PM KALYSSA MAILE, Staff to Representative LeDoux, Alaska State Legislature, sponsor, informed the committee there are two substantive changes in the proposed CS for HB 337. The first change is on page 2, lines 14-20, which read: Sec. 43.61.050. Administration and enforcement of tax.(a) Each marijuana cultivation facility is primarily liable for the payment of the excise taxes on marijuana sold and shall furnish a cash or surety bond of $5,000, payable to the department and approved by the Department of Law. If a marijuana cultivation facility fails to pay the tax to the state, the marijuana cultivation facility forfeits the bond, and the Marijuana Control Board shall suspend the marijuana cultivation facility's license until payment is made. MS. MAILE said in response to public testimony, the $5,000 bonding requirement was changed to a cash or surety bond. The second change is on page 3, line 7, which read: Sec. 4. This Act takes effect immediately under AS 01.10.070(c). MS. MAILE said this section would ensure that the bill would be signed into law before licenses for marijuana establishments are issued. REPRESENTATIVE JOSEPHSON has heard that there are 200 applications for commercial marijuana operations, and he asked when the applications would be accepted or rejected. MS. MAILE deferred to the Department of Commerce, Community & Economic Development. 3:50:17 PM CHAIR OLSON removed his objection, and without further objection, Version H was before the committee. REPRESENTATIVE HUGHES opined that the tax for excess marijuana is really a penalty or a fine. REPRESENTATIVE LEDOUX responded that the amount would be the same amount as though the business had registered. REPRESENTATIVE HUGHES maintained that a penalty is more appropriate, as she is unfamiliar with a civil tax. 3:52:07 PM CHAIR OLSON reopened public testimony. After ascertaining no one wished to testify, public testimony was closed. REPRESENTATIVE JOSEPHSON returned attention to page 2, lines 6- 13, which read: Sec. 43.61.040. Tax for Excess Marijuana. A person who is not registered under AS 17.38 and who is found to be in possession of marijuana plants in excess of the amount of marijuana plants authorized for personal use in AS 17.38.020(2) is subject to the tax on the marijuana plants possessed in excess of the amount authorized for use in AS 17.38.020. The tax due under this section is $50 for each ounce or partial ounce of marijuana possessed. When determining the weight of marijuana for purposes of this section, the department shall use the aggregate weight calculated under AS 11.71.080. REPRESENTATIVE JOSEPHSON questioned the use of "not" registered instead of "registered or unregistered." REPRESENTATIVE LEDOUX explained that when a person is not registered, "personal use doesn't come into play." [HB 337 was held over.]