Legislature(1995 - 1996)

02/01/1996 08:00 AM STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= 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             
 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                     
 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                  
 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               
 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             
 Number 1099                                                                   
 CHAIR JAMES reiterated the amendment before the committee to HJR 49           
 was to tighten the language to specifically refer to motor                    
 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                    

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