Legislature(1995 - 1996)
02/01/1996 08:00 AM STA
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HJR 49 - DEDICATED HIGHWAY FUND The next order of business to come before the House State Affairs Committee was HJR 49. CHAIR JAMES called on Barbara Cotting, Legislative Assistant to Representative Jeannette James to present the sponsor statement. Number 2191 BARBARA COTTING, Legislative Assistant to Representative Jeannette James, said there was a wide amount of support for HJR 49. She said this resolution differed from similar ones in that it utilized only state taxes on motor vehicle fuel, and that the legislature may appropriate money from the fund only for the maintenance of roads and highways. She said it did not deal with aircraft and watercraft, and enforcement of motor vehicle laws as other attempts had done. Ms. Cotting said the amendment was an attempt to tighten the resolution. She further said the Department of Transportation, truckers, and the tourist industry supported HJR 49. There was information available if the committee members wanted describing the research behind the resolution and what other states had done. CHAIR JAMES announced to Robert Gigler in Anchorage that the House State Affairs Committee would not be hearing HB 363 today in the event he needed to leave. CHAIR JAMES referred the committee members to the amendment and read, "from state taxes on fuel used for the propulsion of highway or road use motor vehicle." TAPE 96-9, SIDE A Number 0000 REPRESENTATIVE IVAN IVAN asked how a road was defined in HJR 49. He cited in rural Alaska there were many dirt and gravel roads. Number 00029 CHAIR JAMES said anyplace a road tax was paid. She cited a federal definition that mentioned a maintained road. Number 0076 REPRESENTATIVE PORTER enquired about the previous attempt and the problems. CHAIR JAMES called on the next witness in Juneau, Sam Kito III, to answer Representative Porter's question. Number 0102 SAM KITO III, Legislative Liaison/Special Assistant, Office of the Commissioner, Department of Transportation and Public Facilities, said the previous dedicated fund resolution contained too many components and too many interests which created problems. He said it was too big of a bill. CHAIR JAMES asked about licensing fees. MR. KITO III responded licensing fees were included as well as funding provisions. Number 0182 REPRESENTATIVE OGAN said he did not understand the fiscal note and wondered if it would increase the appropriations for road maintenance. Number 0205 CHAIR JAMES replied, no, because the amount of motor vehicle tax received was $24 million to $25 million and the state was spending $75 million in road maintenance. She further said there was a road tax being proposed, and the public was willing to pay a higher tax if they knew it went into a fund. Therefore, HJR 49 would guarantee a certain level of funding and would not suffer with the declining budget. Number 0295 REPRESENTATIVE OGAN wondered if this was a cog in the wheel of the long range fiscal plan. Number 0305 CHAIR JAMES replied it could be. She read the following definition of a highway found in a statute. "`highway' means the entire width between the boundary lines of every way that is publicly maintained when a part of it is open to the public for purposes of vehicular travel, including but not limited to every street and the Alaska state marine highway system but not vehicular ways or areas." Number 0349 MR. KITO III added the Department of Transportation and Public Facilities was very interested in the concept of a dedicated fund because it ensured a revenue stream for maintenance. This, he alleged, was valuable to guarantee the state road system was adequately maintained. Number 0380 CHAIR JAMES said there was support for a similar resolution for boat and aircraft taxes. She said she did not want to include them to keep HJR 49 focused in-order-to pass. Number 0434 REPRESENTATIVE GREEN mentioned the 90/10 federal government rebate split for road maintenance in Alaska and wondered how HJR 49 would affect it. Number 0475 MR. KITO III said HJR 49 would demonstrate to the federal government the state was trying to maintain our existing highway system. The split he cited was between $6 to $7 for every tax dollar put into the fund. He cited California put in $1 and received 80 cents and they wanted to get their dollar back. He said Alaska needed to justify that $7 for every $1 put in the fund to other states for support. He cited seven alternatives were released in a report by the General Accounting Office for redistribution of the federal highway trust revenues to the states. He said in the alternatives the state of Alaska went from $230 million to $89 million in the best case scenario. In the worst case scenario, he stated, Alaska went from $230 million to $37 million. He further said Congress did not have to choose one of the alternatives, but they would take it under advisement. Therefore, he said in six years or so the state could see a serious decrease in federal dollars. He also said at this point the department did not collect enough tax revenue to develop a state program if the federal funding was lost. Number 0598 REPRESENTATIVE GREEN replied the federal government would probably look more favorable towards Alaska by adopting HJR 49. Number 0624 MR. KITO III responded, yes. He said any indication that the state was working towards stabilizing a maintenance fund for the highways would look favorably compared to other states. Number 0639 REPRESENTATIVE PORTER wondered if other states that contributed to a federal highway fund used motor fuel taxes or general funds. Number 0666 MR. KITO III cited two states and the District of Columbia that did not have a dedicated fund for transportation. He said the state of Texas did not have a fund dedicated for transportation, but for every penney raised the state increased the revenue by $200 million. He said he did not know how the money was allocated to transportation, but the revenue generated was enough to adequately fund the transportation system. He further stated most states had a constitutional provision or a statute that set aside a separate account for maintenance and operation of the highways. Number 0715 REPRESENTATIVE PORTER wondered if the state would contribute to the fund through a general appropriation. Number 0723 MR. KITO III said everybody in the U.S. paid a federal fuel tax, that went back into the federal highway trust fund then subsequently reallocated. Therefore, the state of Alaska was not paying money directly, but paying through the usage of the fuel. Number 0742 CHAIR JAMES announced to the audience the House State Affairs Committee would not be hearing HB 368 today. CHAIR JAMES called on the next witness via teleconference in Anchorage, Robert Eakman. Number 0779 ROBERT EAKMAN, General Manager, Alaska Independent Truckers Association, announced his support of HJR 49. He wondered about the definition of the word "maintenance" in the resolution. Mr. Eakman wondered if fixing pot holes or tearing up roads and replacing with better material, for example, were included in the definition. He cited roads were surfaced very recently in Anchorage that needed repairing again due to ruts creating a hazard. Number 0848 MR. KITO III replied the maintenance that would be covered in HJR 49 would include filling of pot holes and minor resurfacing, for example. He also said the revenue coming in from the bill would not increase the current budget so the department would not be able to do more until the tax revenue increased. CHAIR JAMES called on the next witness via teleconference in Anchorage, Jack Wiegel. Number 0895 JACK WIEGEL, President, Alaska Independent Trucking Association, said he had been a resident of Alaska for 25 years. He stated his support for HJR 49 and alleged it would create jobs. He said it would be a direct injection of dollars into the economy as well as promote safety on the highways. CHAIR JAMES called on the next witness via teleconference in Anchorage, Ted Deboer. Number 0935 TED DEBOER, Alaska Operations Manager, Totem Ocean Trailer Express, stated his full support for HJR 49. He alleged it would solve a lot of the highway problems, as well as promote safety. CHAIR JAMES called on the next witness via teleconference in Anchorage, Duane Saulnier. Number 0969 DUANE SAULNIER stated his support for HJR 49. He further said he would like to see some up-keep on the roads. CHAIR JAMES called on the next witness via teleconference in Anchorage, Blaine Ghan. Number 0990 BLAINE GHAN, Lynden Transport, said his company strongly supported HJR 49. He said the wording was critical. He said the dedication of a highway maintenance fund would be very beneficial to the highway system for the public and the industry. In conclusion, he said, provided the wording was correct, his company was in full support. CHAIR JAMES called on the next witness via teleconference in Anchorage, Kym Swift. Number 1031 KYM SWIFT, said she did not understand why HJR 49 was before the legislature this year. She said the Administration alleged the resolution would not increase maintenance. She wondered why the money was being taken off the table when the state was facing a $500 million fiscal gap. She further said the framers of the constitution prohibited this for logical reasons because it made it hard to adopt in changing economic times which Alaska was about to face. She stated 25 states in the U.S. had dedicated education funds and Alaska should look at that before a highway maintenance fund. Number 1099 CHAIR JAMES reiterated the amendment before the committee to HJR 49 was to tighten the language to specifically refer to motor vehicles. Number 1122 REPRESENTATIVE PORTER moved to adopt the amendment. Hearing no objection it was so adopted. Number 1152 REPRESENTATIVE PORTER moved that HJR 49 move from the committee with individual recommendations and attached fiscal note. Hearing no objection, it was so moved from the House State Affairs Committee.