Okay, I'm going to call this meeting the House Finance Committee to order let the record reflect that the time is currently 9.06 a.m. on Thursday, February 5, 2026 and present today, we have Representative Allard, Representative Hannon,
Representative Moore,
Representative Coachere,
Tragi,
Representative co-chair Josephson,
Representative Jimmy,
Representative Galvin,
Morning everyone looks like we've got a pretty full house today
Before we start, please mute your cell phones
We have one bill before the committee this morning and that's House bill 284
It's the governor's omnibus tax bill and the plan is to introduce the bill
And have the Department of Revenue give a presentation
then we'd like to
Have a Presentation from the Alaska Municipal League and I believe it's knows and racing there you go and
And then this evening starting at 5.30 we'd like to get some feedback from the public
on this bill and so again at five thirty we'll be taking some public testimony.
At that meeting what I'd
like
to do is just have a really short overview just to kind of bring the
public up to speed just kind
of hitting the highlights and give the brief overview of the bill
and then we're going to public
So, with that, I'd like to invite, oh, and I glad somebody mentioned this.
Thank you, Representative Hannon.
I would like recognize that we do have some legislators in the room,
and thanks for being here today.
We do you have Representative Colomb,
Representative Ruffridge,
Representative Ilam,
and,
I think I have everyone.
And so,
with, that appreciate you being there.
So I'd like to invite up to the table Ms. Janelle Earls, the administrative services director and acting commissioner for the Department of Revenue
Brandon Spanos, acting tax director, Department
of revenue, Dan Stickle, chief economist, department of
revenue. If you could all please come up
to table and put yourselves on the record and begin your presentation. We do have quite a few slides in the slide deck. So
What I would like to do is if maybe folks could hold their questions until the end of each section
I think that might help to speed things up a little bit while at the same time allowing folks to ask questions
So again if we could just hold questions into the End of Each section and with that
Commissioner, thanks for being here today
Thank you
Thank You all for having us here house finance committee
Janelle Earls, Acting Commissioner and Administrative Services Director for the Department of Revenue
here with me today are Acting Tax Director Brandon Spanos and
Chief Economist Dan Stickle. We are here today to present on the Governor's Tax Bill, House Bill 284.
As
Representative Foster said we have a long presentation today on a large bill. So
We'll try to get through each slide fairly quickly.
This presentation will first go through policy goals,
talk about each component of the bill,
and if there is time, the fiscal note
and sectional analysis.
Next slide.
The governor's policy goal are to provide a plan
for fiscal stability and its spending.
Improve Alaska's long-term appeal for families and businesses to ensure a predictable PFD and
require agency operations be reviewed on a regular regular basis
And slide five is just the fiscal plan in more detail I
will now turn it over to
Acting director spanos and chief economist
They have 20 years of experience each
with the tax division and are well suited
to answer your tax questions.
Robson, Valor, did you have a question
or Robsen of staff?
Robzen of Staff?
Yeah, I think Coach here foster to the chair
to our wonderful revenue folks.
Thanks for being here and it's good to see you guys.
As always.
I'm just on slide four, where we look to articulate the policy objectives of this proposal.
I think it's probably going to be an interesting as we walk through this bill to determine whether or
not aspects of the bill actually do that, right?
Especially on point three, improving Alaska's long term appeal for
families and businesses.
I fail to see how enshrining a liability that outstrips the amount of revenue I'm raising in taxation creates anything but more instability and a need for more taxes, but I look forward to having you guys articulate that as we go through the process.
Thank you.
Thank You. Please proceed with the presentation.
It didn't get me out of coming up and presenting, though, so.
Good try.
Yeah.
So moving into the omnibus bill, as you stated, Mr. Chair,
it's a relatively long presentation,
because it is a very long bill.
There are three main components of the bill that
is the first, the proposed seasonal sales tax,
second, updates to the.
updates to an eventual eventual elimination of the corporate income tax and third two changes to the oil and gas
production tax
The first change there is right raising the minimum tax floor from four to six percent
And then second adding a new fee for pipeline corridor maintenance
I will go through each of these components one at a time and
Appreciate as mr. Chair you noted questions could be held until the end of each section to allow us to get through all of
So first we'll go over the sales tax.
This is the largest section of the bill because it's standing up a new statute.
So the tax rate would be 4% for half of a year and 2%
for the other half the year.
It has certain exemptions which I'll do over in more detail in later slides.
And it would also be administered by the state which will also go.
Through in more detail in later slides the bill has
Rather the Bill provides for timely allowance of the lesser of 1% or $75 for the seller
For the burden of collecting and remitting the tax to the state
Moving on to slide 10
The tax is at the on the consumer or the purchaser and is collected and remedied to this state
By the business that sells the product or service
For those who itemize deductions on their federal tax return they can itemise the sales
tax as one of those deductions.
Slide 11, most people understand what a sales tax is.
We put in the slide specifically about the use tax because there's often confusion on
Use tax is basically a complimentary tax to a sales tax and it allows
It basically tries to close a loophole of if you purchase an item in another
Non-tax jurisdiction and bring it into the state to use it that you still would pay the tax
So when the sales tag supplies the use tax does not and when they use tag suppliers the sale tax
Does not they're mutually exclusive
It only applies to sales
That that are
So this used to be mainly for online sales.
Those are mostly taxed now after the Wayfair Supreme Court
decision, which we'll get into a bit more.
So states used apply the use tax to those.
And it was on the honor system.
And they had a hard time collecting those taxes today.
And that's larger items like cars and such,
or what states mainly capture.
And then it's still on honor for everything else.
And so, we would envision, our bill has a requirement to, when you register your vehicle, you would pay the tax.
So those would be captured.
Other things like major purchases that are brought in through customs are reported to the Tax Division, so those will also be
captured, other things would have to be self-reported.
So moving on to slide 12.
Historically, as I mentioned, internet cells were not taxed by states unless the seller
had a physical presence in the state, and this was the result of a string of cases,
but the most recent case in that string was Quill Corp versus North Dakota, where in
that case the US Supreme Court decided back in 1992 that most cells from, well, just stepping
92 most sales were done, cross-border sales
were down through mail order.
And fast forward to 2000, and physical presence
was not as much of a concern for states.
And they started to question,
if that standard should still be applied,
given that most cross border sales
were now internet based and the
computers made the burden of tracking taxes and various jurisdictions simpler.
So in Quill, the court had stated that a tax payer shouldn't have to know the
burden. A seller of goods shouldnít have
to have the burdens of the hundreds of jurisdictions that it sells its goods
into. And because of that, it was overly burdensome. They shouldníst
have collect the tax at all. The burden should be on the individual
South Dakota decided to challenge that because online sales was very prominent
and modern computer systems allowed for simpler tracking and reporting and they
passed a law that crafted specifically to
challenge the physical present standard that was which was in the quill case they
was pretty popular among states and certain tax attorneys. South Dakota applied its sales
tax to internet sales through a statute change which was challenged by Wayfair, an online
seller of goods and furniture. The case went to the U.S. Supreme Court which overturned
the prior precedent in the quill case by stating that as long as a state met three criteria,
that had no physical presence in their state.
And so those three criteria are,
a company must have substantial nexus,
excuse me, substantial economic nexus with the state,
this bill does that by having a threshold
of $100,000 sales into the State,
which the US Supreme Court determined
in South Dakota was a substantial Nexus.
And second, a state must apply non-discriminatory
standards to all sellers.
And this bill meets that test by having only one sales tax that applies to in-state and out-of-state sellers in the same way and in
the manner, except for that $100,000 threshold, which is the first test.
And then third, a state must not impose undue burdens on interstate commerce.
By ensuring that the compliance process is reasonable and fair
This bill proposes to do that in a way in the same way that South Dakota did that
Which is by having all sales tax in this state administered at the state level
So moving on to slide 13 would like to note we also have with us representative Bynum, and we're actually gonna hold questions till after each
Section if that's okay, thank you
Please proceed. Thank you
The taxes would be remitted to the state by the seller using our revenue online system,
which is electronic filing of tax returns, electronic payments, and electronic communication
with the tax division in a secure system.
As I stated in the last slide, the State would administer the Tax to be compliant with
the Wayfair case.
In that case, The Supreme Court highlighted that the South Dakota system for administering
designed to minimize burdens in interstate commerce.
And one of the key factors was centralized administration.
The court pointed out that South Dakota
had a single state level taxing authority
that handled both state and local taxes.
This means the sellers had to register, file,
and remit through one system.
They didn't need to deal separately
with hundreds of local tax jurisdictions.
this streamlined approach to reduced compliance, complexity, and support of the court's finding
that the law did not impose an undue burden on interstate commerce.
The court contrasted this with states that have fragmented systems which could create
significant administrative challenges for remote sellers. South Dakota's centralized
system was cited as a reason it was constitutionally sound under the Commerce Clause.
The vast majority of states levy a sales tax and a use tax.
At the seasonal 4% rate that's proposed in this bill, Alaska would tie with five other states as the second lowest tax rate in the nation.
At that 2% tax rates, we would be the lowest in tax in a nation at the state level.
The average local sales tax rates, Alaska, would be the sixth lowest combined when other states combined their average
local tax rate and
The very broad base that that you see in the bill allows for a a low rate
Slide 15 the intent behind the legislation is to create a very
broad Base that applies to most consumer goods and services allowing for one
of the lowest rates in the nation, as we just mentioned,
the governor deliberately excluded intermediate business
transactions, which can lead to tax-perimiting,
and the goods being even more than just one tax level.
They can have multiple tax levels in that in
the chain of a good as it makes its way to the consumer.
The way the bill is structured.
is straightforward. It starts with the assumption that all goods and services are taxed, and then
it lists specific exemptions one by one. This approach is administratively simpler than trying
to define which or what is taxable from scratch.
It gives clarity and consistency. And then on the next slide is where we start to go through the
exemptions. I'm not going to read all the exemptions, I will just leave the slide up here for a minute
even more exemptions. Most of the exemptions are either exemptions where
the state doesn't want to tax itself. Exemptions that are required by the
federal government or exemptions that just make sense like employee wages that
are usually taxed under an income tax rather than a sales tax. And slide 17
We have been asked about that jet fuel a few times. So I'll just highlight that one
This come goes back to
Interstate and international commerce
States cannot tax
the
Getting goods from point A to point B for interstate or international Commerce
So the only thing that you can tax is the fuel used in your airspace
you can't tax the fuel used in international flights
or interstate flights when they're used
in interstate commerce, which most of our flights are.
So rather than do it, having some complicated credit system
to apply only the tax to the sale of fuel
used on our airspace, the decision was made
to exclude jet fuel completely,
which is also excluded on are motor fuel tax.
Different fees that out there for like this bar the jet fuel is also excluded there
Any question representative
Step and it looks like that takes us through
The first section just for the public we're looking at three section of this almond this bill
That's the sales tax corporate tax and oil and gas taxes, so
Thank you very much for that was a good high-level introduction. I think and I'm sure there are going to be a lot of questions probably a
Lot to impact there.
I Think we've got representative staff and then representative Galvin
Rips in of step. Yeah, I thank coach or foster
I have a few in succession if that's permissible or through the chair
Sure, it's an upset dr. Spanos
So first wayfare case also had a second test
It was a transactions test and I think it was 200 plus annual transactions
I do not see that outlined in the bill through the chair
Through the Chair Representative staff after Wayfair was decided
first of all, South Dakota wanted to
Ensure that they were going to meet that standard and so they had two tests
Most states currently only have one test in and talking to those states
They strongly recommend that you do NOT use the transaction test because you can sell
200 keychains into a state and the total cost might only be $50 and now you're requiring
them to file a tax and remit tax on that $15 and it was just overly burdensome.
So the $100,000 is the current standard for most states.
Okay.
A follow-up?
Yeah.
Thank you.
So on slide 11, I was hoping that you could perhaps break this down a little bit more
regarding the mechanics of the way the used tax works.
So, the away I read this, it says the tax basically would be applied on anything that
in the state, including purchases made outside and then brought into the
state. So a lot of Alaskans buy vehicles in Washington and bring them into Alaska.
In that scenario, if this bill were to pass, what happens to the use fee on that or
tax on the type of purchase through the chair? Through the Chair Representative
It's bill will bill were to pass and you purchased the vehicle out of state brought it into state when you went to register the
Vehicle that's when the tax the use tax would be applied
Fault mr. Coach here. Hello. Yeah, thank you. Okay, so just to be honest just be clear
If this bill we're going to law all those folks who
Buy their vehicles out-of-state as soon as they would register they'd have to pay the 4% or 2%
um under that point like does it
Now, is the point of the purchase, where we're going to apply the seasonal sales tax, or is it the
point in registrations? Because obviously there's a material difference between registering at 4%
and then registering it 2% through the share. Through the chair representative staff, most states
do this the same way. They have the tax paid at the registration. And the reason for that is that
unrelated purchasers that aren't businesses and so the states capture the
tax by the point of the registration for a vehicle specifically however if you
purchase a
vehicle at a dealership I'd have to look into that some states may have a
transaction there as well but I believe that almost all of them are the
DMB level okay continuing on Mr. President thank coach your foster to the chair so getting into and I won't I
Won't kind of go through this like super in-depth Lee on the exemptions, but explain to me
We are exempting purchases made with on through wick and food stamps
But we are not exempt in the things that you use wic for
to people who aren't on that so for example diapers formula that type of
stuff all those things are currently taxed under this broad proposal unless
you are purchasing them or receiving them through wick or through food stamps
or some other type public assistance program is that correct through the
chair through The chair representative staff that's correct okay my last
How are we improving Alaskan's lives as it shows on slide four?
How is the objective to make this a state that has more appealing long-term for families when we're taxing purchases of vehicles out of state?
taxing formula and diapers that they use
taxing fuel purchases, that's not jet fuel. How we are improving
families lives in Alaska by doing this through the chair.
Janelle Earls, Acting Commissioner,
again, Representative Stapp through the chair.
This is the comprehensive fiscal plan
the governor has put together.
It still allows for the PFD and a small share of sales tax.
Yeah, I'm just reading off the slide through the chair. It says in slide four
It's says we're improving Alaska's long-term if you'll for families and businesses by doing this and
I am failing to see how taxing all those things
Would achieve that outcome, but I know there's more to the proposal
So I'll probably go back to this point a few times, so thank you. Thank you
Let's see at the beginning of the presentation we had Representative Galvin who had a question
and then Representative Bynum, Representative Hannon, and Representative Allard.
So next we'll go to Representative Gallvin.
Thank you, co-chair Foster, through the chair.
Thank for being here.
I appreciate that the governor is putting something forward around revenue.
I really appreciate this conversation.
now starting to face and and I also understand that we want to keep Alaskans here safely
on roads that they can travel on and in schools where our families want
to spend their time and feel proud that
we are supporting as a state these important pieces so thank you for this
and with this particular peace in mind the sales tax I want
around your decision on slide 9, thank you, to call this seasonal sales tax, in this case it is a sales
tax that is year round. It is adjusted as far, I just want to make sure that I'm reading this right.
It's not what most people think of as a seasonal
sales-tax, which means typically
Some states do this when they know there's going to be a large influx of visitors into the state.
They want to make sure if they're using the roads and they are using this systems.
That they also paying a little extra when spending their money on products.
And perhaps that's why we've chosen the different dates, but I do see that Alaskans are being taxed year round.
Could you confirm that?
when we were putting this presentation together,
I had the same concern.
It's like seasonal is usually means that,
but I did actually have to Google it
and look it up and there are states
that have a rate that changes seasonally,
that they call a seasonal sales tax.
So we did determine that while it's pretty standard
to call that also seasonal,
I wanted to called it a seasonall adjusted rate.
So that's another term that you could use,
but there our states that call it
I appreciate that very much, and in a state where we've not had this before, it makes sense to call it
whatever it is that helps people appreciate what it
is. And so in this case, I like your
suggestion of a seasonally adjusted sales tax because it
is a sales
tax year round for all Alaskans. So thank you for that.
And then, if I may, there was a slide that noted the breakout as well.
It was 70-30 split when we combined those rates over the, and in doing it seasonally and
having the 4% rate during a tourist season, that does reduce the tax burden on residents.
Without that, I think it was at a 75-25 split.
Thank you, and if I may a follow-up. Yes, I'd like to quickly
Welcome representative Underwood to house finance. Thanks for joining us representative Galvin
Thank You and the next question. I am going to give a little context because I think it may be
helpful given this larger broader conversation I
wanted to ask you to comment on sales tax versus income tax and one night
before I get to your answer
I want to state that Alaska's context,
which I'm sure we'll be hearing about.
We already have over 100 municipalities
and with local sales tax, as you know.
And it's different in every single community.
Not in any community, do we have a sales-tax?
I appreciate that, and Anchorage, we do not yet,
but it is complicated.
sales taxes, when you look at historically all across American cities, what I'm hearing
from when I've done my research from many of the economists that it does have more impact
on families with less. Without question, economists say that. It has more
would disproportionately hurt rural residents if a statewide tax is put in place.
And the burden on non-residents is substantially different.
Especially nonresidants who come up here and make over $200,000 a year.
By coming up for two weeks, going to the North Slope and then going back home.
And they pay income taxes and oftentimes sales taxes in their region,
I warmly welcome those workers to still continue coming,
but when you were considering sales versus income,
I hope that there was some discussion around this,
and I hoped that you could give me a bit more reassurance
about why a sales tax is a better idea
than an income tax, please.
Commissioner Earls?
Through the chair to Representative Galvin,
I really appreciate that comment.
no perfect tax regime. By having the sales tax, we are able to collect from
non-resident workers and tourists as well. So it's not fully the burden of the
residents of Alaska. Follow-up? Do you have any research that shows that
come up here and spend time and a lot of their money in a way that would pour into our Alaska
state revenue pot, if you will. I have a lotta my own research from what I've seen that many
get back on the plane, they always get the first class seats
because they're high flyers, right?
And I'm not against that, but I just want
us to understand that they are not necessarily in my mind.
But if you have data that proves otherwise,
I am all in to hear that I know they go fishing occasionally
and things like that.
But I would like to see data
that shows, if have it, that we are capturing
important revenue for Alaska by instead of capturing
2 or 4% of their income, which by the way, is less than what they're paying back home.
So we're not going to lose any workers.
They're going be double taxed if there's an income tax, that doesn't happen.
It's not legal, but I don't know that 2% or
4%, would give us a lot more funds if it's put on the sales versus income.
So that's the data, or if you have any broad understanding of that, I'd appreciate it.
Thank you, Representative Galvin, through the chair.
I would have to double check to see if we have data.
Sure, maybe I can jump in here.
Dan Stickles, Chief Economist with Department of Revenue
to Representative galvin through chair, so we do have some
information about potential contribution to sales tax
from non-resident workers.
So broadly speaking, there's three groups of individuals
who would pay the tax.
There's your more traditional tourists who are coming here on cruise ships or independent
tours.
And then there are the non-resident workers.
Some of those nonresident workers are come here for extended periods of time, for instance,
in the tourism and fishing industry, oil and gas mining as well.
But the model does specifically break out the share of revenue that comes from those
non resident workers, and we could provide that.
Great.
That would be very helpful.
to what two or 4% of income versus the model of what they're bringing in from sales that
would be a great comparative study for us. Thank you. And if I may, I have one last follow-up.
Representative Galvin. Actually,
I'm going to hold on that because I know there's other questions.
Thank You. Sure.
Thank
you in line. I've got Representative Bynum,
Hanan, Allard, Tom Schofsky, and Josephson.
And I don't see any other hands. So with that, Representative
interesting topic we have in front of us here today really looking forward to
getting more into this. We went through the slide deck here on the
presentation of sales tax and I think there's going to be probably
lots of questions swirling around that because I don't think
the 15 slides or so that we will adequately convey to
not just this committee but to the Alaskan people on why
Representative Stapp had actually asked a question that I was thinking about here quite a bit.
It was about vehicle registration and when does that apply?
Are we going to have all of our Alaskans buying vehicles in the winter time
because they don't want to be subject to a 4% in summertime?
So I appreciate that question being asked to look forward to the answer on that.
But one of the things that is interesting about this particular proposal,
is that I understand that we're trying to say we are trying
to capture revenue from all of our visitors.
And for those of us that watch the ISER presentation
on this topic, one of the things they talked about it was
using the sales tax mechanism to create stability.
However, as it not being as volatile as maybe other forms
of taxation, but at that presentation I asked the question
Well, how is that being modeled and why are you modeling it that way?
Because we know that in Alaska, if we're trying to capture non-resident revenue through visitors,
that those opportunities are tied to the economic condition of the country.
And so when we see that cost of travel or there's an economic instability in the country,
maybe in world, that the volume of people actually coming to our state for travel may
go down.
But even if it doesn't go there, spending habits absolutely do change.
And we, and I came before I was here on a borough assembly where we monitored what was
happening in our economy, which is a very highly influenced by tourism.
And, we saw that global pandemic wiped out all revenue coming in from a sales tax.
We know that instability,
People come in to visit our community, has went up,
sometimes it levels off.
But even with high numbers of people coming,
that when we do have that economic instability,
they spend a lot less money.
So when I asked this question of ISER,
I said, was this taken into consideration?
Their answer was no.
That they are modeling over the United States as a whole.
OK.
So I was just really wanting to know,
And what your perspective on that answer is, and does this truly create a stable income
source for Alaskans that's leveraging our visitor industries and people that are here
temporarily?
Or is this fully focused long-term stability going to be placed on the backs of Alascans
to fund this?
Is this something that was considered?
And if I can read read request the question if it wasn't clear what I'm trying to get at here
Representative Bynum, did you say you're gonna rephrase the questions? I mean asking if they need to re-phrase a question who would like take a stab at that
Commissioner Earls
Through the chair to representative Bineham if i'm hearing you correctly
You want to ensure that it's not fully gonna ride on
Alaskans to have these taxes collected, and I think that the study, as you had stated,
did not take into those economic downturns. So, at this point in time, I'm not entirely
Presenting a plan to us that is going to try to you know something for us to consider
Those particular economic instabilities were not considered as part of this fiscal plan
Is that what you're saying?
Through the chair to representative Bynum. I may have to turn to Chief Economist Stickles to help answer some of the
The modeling that has been done. Thank you
Mr. Stickel?
Sure, again, Dan Steckel for the record represented by them through the chair.
So I can provide some general's perspective around stability on state revenues.
So, you know, our fiscal system now.
Has a lot of reliance on the oil and gas industry that tends to be a a very volatile
Revenue source to the state looking at other states that do have sales and income taxes those both tend to
More stable than oil in gas as far as as revenue goes for the states. That have
Sales taxes. Those are actually a little less volatile than income tax is in a downturn
or an upturn and one of the reasons for that is income taxes tend to be heavily
influenced by things like capital gains and so you have
when you a big expansion or downturn that will lead to
either really big stock market gains or losses and that makes the
income tax can be more volatile than a sales tax for other states. So
sales taxes generally viewed by economists and
tax professionals as one the most stable revenue sources.
Follow-up follow-ups. So
When you're evaluating this my understanding as you were trying to bring forward something you figured would be or that you believe will be more stable
But in application when I go through the from the presentation you guys were talking about
That the state will set the parameters for what can and can't be collected as far as exemptions
Does that go across the board for the local taxes?
Because, again, I'll use my community as an example.
I have a borough and a city.
We have city taxes.
We are borough taxes, we have the sales tax cap.
We a senior sales taxes exemption.
There's items that aren't exempted, and my understanding
is that this bill basically tells municipal governments
the exemptions and things that will happen
will go out the window.
and this will be the framework in which we are applying the taxes.
Is that an accurate understanding?
Mr. Spanos.
Through the Chair, Representative Bynum,
in order to be compliant with the Wayfarer decision,
a centralized administration, and also
like the same exemptions across the board and the
same definitions are...
standard in states that are doing their best to comply with Wayfair.
So this proposal, because we're standing up a brand new tax, we don't want to,
we want learn best practices from other states.
And other States have said this is by far the best practice.
And if there are other exemptions that the state wants in general,
they can be added to the bill.
There's nothing preventing the legislature from changing the governor
broad base so that he could have the lowest rate, but if there's certain items that are
exempt locally that the committee or the legislature would want to exempt, certainly that is an
option that can be done in order to hit the same revenue target, the rate would then have
to go up to match and we can model that.
Senator Bynum.
Thank you.
Through the Chair, specifically for that then, did you take into consideration?
The impacts on those on the on these communities that are charging those taxes and the current tax structures that they have
Because with organized with the organization in the state with organize burrows there already is a cost shift from the
State to those organized burrow's
You know I've heard through presentations from
The governor on this that. They've talked a little bit about
There was a talk about
You know, if more people came to the state, that there would be this big burden on the
state because services are being provided and that wouldn't necessarily be good for
the State.
And then I think about my community and I'm like, boy, how did I love to see my
community grow?
I mean, kids in my schools, people working in the shops, but those services
whether it's roads or other services, police, fire, all those things are being provided
locally through local taxes.
So now I have the state telling me we're going to put the sales tax provision in place that
discounts every measure that's already been put in places to provide services.
So did you take into consideration or have you evaluated the impact in communities that
Through this chair, Representative Bynum, to be clear, it's the governor's plan, and
as the commissioner stated, there is no perfect tax regime.
This is the regime that the Governor believes is best for the state, we did model the impacts
on the State, whether those models went down to the local level, I looked at.
to Dan Stickle, but the governor did consider all options
and landed on a sales tax is the best option
for the state at this time.
So through the chair, I'm gonna take that as a no,
you didn't consider or evaluate impacts to communities
they're already charging or already collecting sales taxes
to support the local communities.
Is that?
Mr. Spidey, I hear you say through the chair representative by them. I the governor considered all
The options on the table and and shows this one
Thank you
Okay in the lineup I have representative Hanan allard Tom chef's key Josephson
Galvin and more
Robson of him. Thank you, co-chair Foster. I think my questions are a little simpler
on slide 14
You say average local sales tax rate in Alaska is
1.82 and I am looking to understand how that calculation was done whether it was
100 taxing
jurisdictions without weight or
The example that Representative Bynum just gave in Ketchikan, most consumers would say we have a 6% sales rate because we've got a city and a borough sales.
So were those sales rates.
Counted as to in calculating the average or were they combined to say?
Purchasing in catch can is it 6% in this you have eight in the summer and there's a proposal that eight and a half
So this would put it at 12. Yeah, so I'm not looking to see what it would be with the additional
But I am reading that average local sales tax rate in Alaska is 1.82 is what currently from 100 jurisdictions that are exercising sales
Tax just very quickly. I saw the
are clerking the back look in order to see who's speaking that was a representative by him mr. Spanos
Through the chair representative hannon, uh, thank you for the question
um, I'll have to get back to the committee with my actual reference because
When I printed out the page it didn't come with it, but it's a reputable
Uh, tax website that does an analysis each year on all the states sales taxes and they analyze
Uh what those different rates are they are the ones that came up with that one
0.82%, so I'll have to also get back to you on how they computed that, but they compute those, that combined local rate for all of the states, and then they rank the state's on where you fall.
Okay, follow-up?
Follow-ups.
So in looking at that I'd be interested to see where they counted all municipalities who could exercise and don't, because when I've looked at sales tax, to get us below 2% on an average, there's got to be a lot of our jurisdictions that are.
Only taxing 1% and I don't hear that from communities that exercise sales tax, so I'm wondering if it's the
You know you've got a city and a baro tax to the consumer
It's one tax but to tax analysis. It may look like it is two different jurisdictions
And whether we're including jurisdictions that don't have any in that when they're looking at the average sales tax in Alaska across all municipalities if they are including ones who are not exercising that taxation, so.
And then I have one other follow-up.
Representative Hannon.
On slide 16, one of the exemptions listed is internet access.
And I am looking to define that that means.
the utility bill you're paying for an internet provider.
If that's the definition that you are using as internet access.
Through the chair, Representative Hannon,
the bill drafters added that in because there's a tax freedom
at, excuse me, internet.
Now I've forgotten the name of the internet freedom act.
I believe it's what it is called, the federal government
individuals to connect to the Internet, so it would be the cost to access the
Internet through your either utility or however else you're accessing it.
Representative Hendon.
And that would, thank you Chair Foster, and that
would only be to individuals, not to a business, say a cafe that has Internet
access for its consumers.
The businesses would still be taxed on it, but an individual would have an
Mr. Spunner through the chair representative hannon, I
Would have to give back to you on that unless department of law is here and can answer that right now
Don't see a law online back you, on, that we do have law here, but they've they don't have the answer at the moment, so okay
Thank you. Okay, next up. We've got represented valored. Thank, you care
Through the chart, So I have
A couple of questions, one that I was going to circle back around that representative from Anchorage had brought up income tax.
The first one I wanted to talk about was, I think it's the sales for resale.
So if we already know that there's about a 20% kick up on vehicles up here and then there is a dealer markup.
And if I'm correct, you said if you go down, say to Oregon, we don't pay tax down there, ship our car up, here,
we're going have to pay a tax?
On that purchase when we register the vehicle, that's correct, right?
Okay.
Then if we buy a use card down in the lower 48, ship it up here.
Are we going to have to pay tax on that when you register it in Alaska?
Through the chair, Representative Allard, to be clear, it's not just out of state sales that are brought to Alaska.
All purchases that don't have a specific exemption would have attacks.
at the local sales tax or the use tax.
So to answer your question directly, yes,
the tax would be applied both to a new vehicle
and a used vehicle.
And I'm not trying to be sarcastic, thank you.
So if I went down and I just bought a whole bunch of stuff
and brought it back by barge,
am I paying tax on like clothes, furniture,
and everything if go shopping down there?
Or is that like a knot?
I think it's a good question.
Through the chair, Representative Allard, I agree.
That is a good question.
There is an exemption for moving to Alaska
and bringing all of your household goods with you.
The use tax would not apply in that case.
But if you go shopping and bring in items,
the tax will apply.
But you would have to self-report that.
We wouldn't have any way of knowing
that you brought goods into the state.
So states commonly have a non-reporting,
right, nonfiling people.
do that and don't report it and the state has a few mechanisms to capture that.
But yes, there would be a self-reporting requirement in the statute.
Okay, just to comment on that part, I'm glad I am military, because then I would purchasing everything through the military PX.
Okay so, car is included.
Okay. So then the other question is.
The representative from Anchorage had brought up income tax and the reason I want this on the record.
We have approximately 11,045 military retirees.
And we have, approximately, 9,000 federal retirees and right now they're not.
So of the military attire, it's approximately over 15%.
So we had the highest per capita basically in the nation, that's a lot.
an income tax, I'm not saying we need to.
I am not say I want to, and frankly,
I don't want any of this.
But if we were to do that, are we looking at,
have you researched that to counter
when someone talks about the income
tax of how detrimental that would be
because of the loss of military persons?
And I will be frank with you.
When we came up to retire, well, when we
came almost 20 years ago, Alaska was high consideration
Tax our federal income when it comes to retirement
Have you guys have any way of countering so that when my esteemed colleagues from other jurisdictions?
Comment about income tax. How are you gonna counter that?
So through the chair representative Allard as noted earlier Dan stick when I've been with the division for a long time
We've presented on income taxes sales taxes pretty much any tax that you could think of we've modeled all sorts of
of those income tax that's been a little while
since I've looked at those models.
Dan, do you have an answer for that?
Sure, Dan Stickel, again, to Representative Allard to the Chair.
Broadly speaking, I think as was stated earlier,
there is no perfect tax.
Any tax is going to have negative downsides.
And...
You know, that's definitely that true of a sales tax.
It's true an income tax and yeah, the impact on on population
and decision to live in Alaska is one of the impacts of attacks
that gets balanced against the positive impacts
of having a sustainable fiscal plan.
And so that is definitely something that we have modeled
in excruciating detail and was covered in the ISA report as well.
Thank you. And I just have a quick comment.
Representative Ellard.
Yeah, I would feel that the military would just kind of cross us off the list if everything
goes up with the income tax and perhaps even with sales tax, they might cross this off
the lists to come up here and retire because it's notably a lot of income with that, the
military and the federal retirees bring in for the population.
that was coined many, many years ago.
I feel like that the sales tax is not a bridge to nowhere.
I think it's a bridged income tax.
So I really think we all need to consider
how not to possibly do that.
Okay, thank you.
Thank you, okay.
Okay.
Mr. Chairman.
Representative Biden.
I'd just like to note that that bridge
to know where it was actually bridges to somewhere
and it wasn't catch a can just for the record.
So.
We have a lot of hard feelings about that bridge.
Thank you for the clarification.
OK, in the lineup, I have Representative Tom Shevsky,
Josephson, Galvin, Moore, and Stapp.
I don't see any other hand.
So with that, Representative Thomas Shevsky.
Thank You, Coach Air Foster, through the chair.
So my question was what Representative Hanan alluded
to with the metrics on how you calculated the average sales
tax.
So I'm looking forward to how those metrics played out.
but I'm also wondering so whenever we institute any kind of tax like this we're kind
of everyone's familiar with the camel's nose under the tent right and once we
institute this even at a two and a four percent what are the levers and how how is it
be assured that it's not going to be 4% and 6% in another year or
6 and 12% years down the road.
How easy is it going be for the next legislature to increase this tax amount in?
And what will be the ramifications of that on the citizens of Alaska?
Mr. Spanos through the chair representative Thomas Shevsky. That's a great question and
They're the control is is you the legislature would of course have the ability to change the statutes and
And if you view that that is the camels knows under the under-the-tent
You need to take that into consideration. However, the governor feels that we are in a well
I think it's everyone realizes that were in the fiscal
difficult situation. A fiscal cliff was mentioned earlier. And the governor wants to have a conversation
about how to solve that. This is the fiscal plan he's put forward to get us to balance
our revenues with our expenses and not doing that, he believes is just not the right thing
years going forward. But if we look at the reality of the situation, we have those concerns now.
And so he wants to act.
Follow-up, Representative Tom Schifsky.
So were there any consideration in how we can make it more difficult for this body to go ahead and just
unilaterally raise the taxes next year? Was there, was there
Was there any consideration in making it
constitutional or
or no
Commissioner Urls
Through the chair to representative Tom Choskey the governor feels strongly that
We need to be looking at this
you know
All the time where where are we at fiscally and going forward a fiscal plan is
Even a ten-year fiscal plan is really hard to predict
So the levers are there though to turn it up and down. Okay, thank you
Okay in the lineup of get representative
Looks like Gellvin stepped out or actually it's Josephson then Gelvin more staff shogging Bynum. We're absent of Joseph's in
Thank you, mr. Coach Herman. I think sort of consistent with where representative Bineum was going
My concern, and Representative Hannon, my concern at slide 14 is that to achieve this average local state or sales tax rate of 1.82,
it must have considered the larger municipalities and Anchorage and Fairbanks in particular,
and their zero rates.
And because the mean should be closer to 5% or better,
While that there's an opportunity to raise lots of revenue, I guess for local governments because
many of them have one in two thousand dollar caps on
purchases
Well purchases above one or two
Thousand dollars so so that may have some enticement for them. It it's it. Its the
The centralization of the exemptions. I think that we're gonna hear they fear
And also at some point the tax rate, the total tax
rate gets so large that it acts as a deterrent for local economies.
Do you have any concerns with those issues?
Now through the chair.
Does that respond to us?
Co-chair Josephson.
Certainly we have concerns and the governor would like to not have a tax as well.
But that's not the situation we're in.
We have a fiscal crisis that needs to be resolved.
And the governor feels this is the best solution for this time.
There is a zeroing out of the tax rate after seven years
so that the legislature can look at it again
and determine is it still needed?
Do we need to change it?
Of course, with such a broad base,
we probably need a comeback and make some tweaks.
sooner rather than later as well and look at other options so yes the governor did consider
everything that concerns him because he didn't want to pass it or ask for attacks either
but that's not the situation we're in we have to resolve the the fiscal problem okay
follow-up follow up on slide 17 as for trades and businesses there's a reference to cost
being deductible. And the concern I have is that lots of potential tax might not be
captured because all a business's purchases, at least under this bullet point, I'd have
to dive into the language itself, would be tax exempt. How do your swash my concerns
So through the chair, co-chair Josephson, the intent behind that, and there's more than
just that one bullet that are doing the same thing, it's to not tax business to business
transactions.
So business inputs that go into an item that is later sold, they intend is to have just
one sales tax applied to it at the consumer level.
We already tax certain industries with specific items, like oil, fish, mining.
And we didn't want to overburden those that we're already taxing with other taxes.
Okay, I guess my last question, if I might, is a comment you made, Director Spanos.
You said that the legislature could make exemption adjustments.
that might then require increases to achieve the goal.
And this is where I most troubled,
with great respect for you all, by the total package.
I can only, all of us can judge
what comes next in our lives, experientially.
What have I experienced?
What I've experienced is that the governor
will object to changes to his legislation.
You made it sound like we were welcome to engage in those sorts of adjustments.
But I just haven't experienced that.
What I've experienced is I got to vote for this bill the way it is.
And I don't know how much allowance the legislature has to go it alone and make changes.
I didn't mean go to alone in that we wouldn't communicate.
I'm, I dunno.
if the commissioner has a response to that.
Commissioner Earls?
Through the chair to Representative Josephson,
I think it's open to some conversation.
This is the conversation that we're having
on the comprehensive fiscal plan.
I'm not exactly, I can't speak to exactly
what the governor would accept,
but I thinks it is a conversation to be had.
Real quick follow-up follow how?
How would those conversations occur?
Would they occur like any other legislation where we would speak to you and you would speaking to the third floor? I
Know that's a odd question, but really how would they happen?
Through the chair to representative Josephson
they can come through us we can speak the governor and
And we could find out more information and get back to as well if that would help
Okay, let's see, you know, for the questions,
Representative Josephson, next we'll go to Representative Moore,
Staff Shrogging Bynum, Representative More.
Thank you, Chair Foster, through the chair.
I think a lot of us have spoken about the fears
about double taxation with our cities and our boroughs
that rely heavily on sales taxes already.
And so maybe you guys can just give another stab at
explaining, watering it down a little bit more for the public that's listening, how this is going to interact with this bill.
And with, so are we, is it a double taxation or, why not, you guys explain that a
little better for people that are listening at home?
Chair.
Through the Chair, Representative Moore.
So double taxation is usually referring to an income tax where two states are taxing the same income twice.
For a sales tax, it's standard, and I can't think of one state that doesn't add a local tax on top of a state level tax.
So the tax is only applied once to the same item,
and there's a State level of tax in most states,
and then they allow for some states have a cap that the local can add.
looking at the numbers here some of those are up to 11% at
the local level on top of the state tax that's sometimes
four to five percent so that the combined rate is a high
tax and that would be the case here in some
of our local communities that have a higher rate.
So if there's a six percent tax
and you add two percent state level
on the off-season then you're going to have
follow-up. Thank you. Um, thank you for that explanation. And then I have another question if
the department has modeled. The household level impact on what the sales tax is going to do,
especially for our rural communities that goods that the price of goods are already
so high. Do you guys have you, guys, looked into that model that seen what what that's going
Sure, Dan Stickel for the record represent more through the chair. So yes, and also
ICER has done that type of modeling as well,
and we'd be happy to provide some information.
Wonderful, thank you.
Okay, we do have 20 more minutes
in this meeting or scheduled to go until 1030, if folks could start.
Thinking about I'll bring this question back to the committee, but if the Department of Revenue and the Committee members can just think about whether or not
We want to go over. I don't know folks have commitments after this in which case we we don t go
over but
If we are able to I
Don't have anything until our next meeting at 1 30 and happy to
Go over if we can but it folks can at least think
About it feel free to pass me a note otherwise I can take in at ease before we gavel out and we
come to some kind of a determination.
So with that, next up, I've got Representative Galvin.
I was before Moore, so Representative
Galvan, and Stapp Schruggie,
and Bynum, Representative Gallvin?
Thank you, co-chair foster.
Appreciate the opportunity to ask just a couple more questions.
One is, actually,
I hope this will highlight a positive about this.
whole presentation and that's around ratings
When I say ratings, I mean ratings for our state and I know that we've already improved many levels
But what I recall in the conversation was that if and when there is a broad base revenue measure put in place in Alaska
It likely will improve our ratings which of course means that for any
dollars that we owe out there, we will likely see a lower percentage that
we would owe on top of that.
And I'm hoping that you might speak to that, that is, what will this do or
how will it look to those who are Moody's or poor others who were out
there in New York deciding what our rating should be and will that save the state of Alaska money?
And if you can give us some picture of
that I would appreciate hearing it.
Representative Galvin through the chair, I would have to get back to you on that our state debt manager does a lot of the rating
Meets with a, lot, of, the, rating agencies and so I could get you more information
Okay, i think i've heard from
This panel i, think perhaps mr. Tickle in the past or maybe it was another
economist but if
If it's okay with you, I would like to hear just a broad statement around whether broad-based revenue would look good for Alaska.
That's just to go.
Sure, Dan Stickel for the record again to represent Calvin through the chair and as Acting Commissioner mentioned,
we can get some detailed nuance and statements broadly speaking.
A sustainable fiscal plan is going to be viewed positively by the rating agencies and we would anticipate that that would be.
something that would favor positive ratings for state debt, which would save the state money.
Thank you, I appreciate that, because I know since things have changed, the balance has changed from 90% oil revenue.
Which now we know is fluctuates because of price much more.
We're needing those dollars that are easy to.
to spend for services. And then we have this investment fund that's doing quite nicely.
But this other piece of revenue isn't in place yet.
And so I have
I really thought about this quite a bit, and I know other states have found favor.
Or I should say the ratings companies have
found flavor in states who do have something in place.
Just as a safety measure, should there be a need for
revenue that is steady.
So I appreciate that, I wanted to thank you again for bringing this to the table because a broad-based measure is important.
So thank-you.
around, if I may, follow up.
Senator Galvin.
Thank you, co-chair Foster.
This one is around multiplier effect, and I think that some of you have touched on it
a bit being concerned about piling on taxes.
And I want to think about what I've heard around multiplier effect of the 1.2 million
passengers, for example, who come in on a cruise ship.
And I've heard there's been some discussion around can we add another head tax there
so that we can make some money, for example.
And what I hear from the cruise companies is if you add
another dollar, we might lose a lot of passengers.
what the chamber and others who care so deeply about making sure that this influx of tourism
still continues.
I wonder if they see that there's a, you know,
attacks on this set of individuals who are coming
into Alaska to spend their money and spend
their time, have we thought about the multiplier effect,
perhaps negative multiplier effects, perhaps not?
But if we've done any research on that and whether
or not it might shoe away some of these passengers
or new visitors because they're concerned
about their costs, I would like to hear that.
That's true.
Mr. Stickel.
Dan Steckel for the record, Representative Galvin through the chair.
So we've looked at macroeconomic modeling, similar to the type of modeling that ISER
has done, that allows us to look at relationships between data and understand how just as the
numbers work, how a change in tax is likely to affect other variables like visitation
and spending.
that should be viewed alongside input from stakeholders.
So one of the things that those models miss sometimes
and can't perfectly quantify is the impact on the climate,
the business climate the investment climate.
The attractiveness of how individuals are going to respond.
So I would view those as one important tool in the toolkit
but then hearing from stake holders is absolutely
another important tools.
Thank you and for clarification. I do want to make sure that we're all aware if you add a head tax money on to
Cruise ship passengers that has to that fund has go directly to something related to the cruise ship industry
So just to clarify I get that this was just an analogy that when we add on
Extra cost to any sort of a visitor that may have a negative effect in terms of bringing in all of these visitors
getting taxes into the high double digits who already has a local tax and how that might affect folks.
So thank you very much for the opportunity to ask that question and I think it's clear to me that we have a lot of
Broad questions yet to be answered and I'm grateful to
be hearing from you and learning from
you about how we can make this piece of
legislation very very strong. Thank you.
Thanks.
I am receiving a few notes here.
Some folks can stay up until a
few hours and some up
until half an hour.
So at least we've got a minimum
of half and hour and but what I
plan to do is we do have looks
like three or four more questions
and then we'll take a three-minute
break. Let folks use the bathroom,
grip some coffee, stretch your legs
and we're going to the next section
which is the corporate income tax
and the oil tax, oil and gas tax.
I don't know if we had a clarification question,
before we go to questions, Representative Moore.
Okay, so in line, I do have Representative Stapp,
Schruggie, Bynum Moore, and then Jimmy,
Representative Stout.
Yeah, thank you, Chair Foster,
Chair to Mr. Spanos.
Okay, so rep allard kind of brought up a pretty good scenario here and you mentioned something that kind
Of concerned me which is basically that this policy we have what's called planned non-compliance for failure to self-report
Right, sorry you bring up goods
State has no mechanism right now for enforcement. So now we had Alaskans that are circumventing the law
Maybe they know or maybe they don't know and it kind
of made it sound like
that's in the plan, i.e. non-compliance for payment.
So first, I'd like to clarify,
are we actually planning for active noncompliance?
And second, is there any legal repercussions
for Alaskans or enforcement mechanisms
when they would be indeed breaking the law
by being noncompliant through the chair?
Mr. Spanos?
Through the Chair, Representative Stapp,
I always have to be careful what I say in a presentation.
To clarify what I was saying is what we've seen from other states, right?
I go to to tax conferences. I talk to other States. They tell me
What they're seeing and that's what they see that there's noncompliance exists
We have non-compliance in our current taxes and and we take action where we can
And we've talked about those bills in this committee before.
Our vehicle rental tax was one, and we as the tax administrators are obligated to enforce the taxes.
So if we know about non-compliance and
we now where it is, we enforce it.
Yeah, follow Mr. Chair.
Representative.
Yeah.
Thank you.
In this same line here.
Okay.
So that's kind of my understanding.
Obviously, we know noncompliance is a thing, but you are the enforcer and Alaskans who do
not report things that they bought and brought here are violation law.
What's the penalty?
What is the punishment?
And how do you actually enforce that?
have random spot checks on vehicles across the border and search their receipts to see
hey did you buy something out of state you got to pay tax on probably not but i mean like what
is our the mechanism here to enforce law violations through the chair through
the Chair representative stat title 43 0 5 is the general tax penalties that apply to all taxes
There is a failure to file penalty and it's well to failure the file slash failure
to pay penalty 5% per month up to 20%
Or 25% I'll have to double check fault mr. Coacher
Okay, well, I'm glad to know that if this bill does pass indeed
People need to make sure that they are complying otherwise that that'd be a hell of an expensive
piece of furniture, I'd imagine, if you had to pay the non-compliance taxes.
You said something earlier through the chair, Mr. Spanos, that I'm very puzzled by, we
reference the executive would not like to have taxes as well, but the fiscal situation
demands that.
I don't see that in the bill.
I see the Bill creates a constitutional liability that is far greater than the revenue measures
are proposing.
Why do we need this proposal and what is the purpose of this?
Proposal when the proposal spends more money than it raises through the chair
Mr.. Just bonus through. The chair representative staff that the governor's
Over-office goal plan wants to maintain 50% of the dividend to the to
the residents of state as well as close the budget gap that that's
that exists on paper, and this fiscal plan
includes taxing in order to help close that gap.
Fault, Mr. Coacher.
Hold on.
The proposal doesn't close the budget gap
based on your own projections.
So I mean, I don't,
I think that's a good question, right?
Does the proposal close
the Budget Gap by constitutionalizing the liability?
by your own tenure projections.
Maybe that's for Mr. Stickle through the chair.
Mr Stickles?
Sure, Dan Stickole for the record
to represent a staff through
the Chair and I believe you may have a handout
that was provided by Office of Management and Budget.
So we prepared a comprehensive fiscal model
that included numerous
Use the governor's tenure plan as a starting point and layered on numerous options for levers around state revenue and state spending
that plan
Does have an initial draw from savings in fiscal year
2027 and as we're working to implement the new revenues, but beyond fiscal years 20 27 the plan is roughly in balance
Fall just represents now
Until the sunset of the revenues
and the payment is constitutionalized.
So if I go 10 years out from today, today is 2027.
If I to 2037 in my revenue sunset,
my liability is always there.
How does that balance through the chair?
Mr. Stickle?
Sure, a representative staff through
the Chair, so in the fiscal model,
in our fall revenue forecast to be clear,
Lower revenue situation for the next several years for next five to seven years
once
Production starts to come online from some of these new fields like the willow and pick a field and once those fields
graduate from
Being eligible for new for certain incentives that apply for for several year of new oil production. We are expecting
a higher baseline, a revenue outlook.
We also have a growing, an assumption for growth
in the permanent fund which leads
to a high or a percent of market value transition.
Also layering on, the administration is very optimistic
around gas pipeline coming online
and we've layered on an assumptions.
You have revenue from the AKL and G projects starting to come online in the 2030s.
And so this baseline revenue combined with the other elements of the fiscal plan in that
modeling does roughly balance even as the sales tax and corporate income tax expire.
Last fault, Mr. Coacher.
I've sensed that.
So if all those things happen, I mean,
I'll just give you a nice round number.
I'm going to add a forever, at least billion dollar liability, obviously it's simplified math because it changes and the taxes are going
to go away and then the gas line and all this production is going
to net me atleast another billion dollars through the chair. Is that correct?
Representative Stapp, through
the Chair, that's the assumption, correct.
Okay.
And obviously uncertainty around any forecast and any model.
Okay. Let's see here. Just so the public is aware, we're starting to get into a little
bit of the big picture and there's a lot of pieces that are out there. This bill is one
of these pieces.
This is the tax component of Governor's fiscal plan. He also has a spending cap bill and
also the split of permanent fund earnings and the bill for that as well. So there is a
let's talk about here. In the lineup I have repped in a
shruggi, buying them more in jimmy, and then what I'd like to
do is I think AML last communicable league is most
interested in speaking to the sales tax component. So before
we go to next section and before we get off of this subject
maybe I might let them speak. We'll take a brief break after
we'll get through these questions. With that, Representative
Thank you to you all for being here.
I really appreciate a tough meeting.
I think you have the unenviable position of advancing
a major fiscal policy change,
which is, I mean, something that everyone admits
is incredibly difficult.
Legislatures had challenges.
The governor has admitted that this is a challenge,
and it's tough to be here presenting that.
So thank you for bein' here and having this conversation.
I do think it is an important conversation
that we need to have, and so I'm glad that were having it.
You know, I think we have had a lot of very challenging questions today that are fair
There's a lotta concerns with this bill
Probably gonna take us quite a while to work through these just based on how things are going so far
But I'd be remiss if I didn't take a moment just to
maybe take a step back and think about the challenges
that we have with the status quo.
I think there's a lot of concerns
with this specific proposal.
I mean, we need to work through those
and figure out how we might address those
or if they can be addressed,
but we haven't really spent any time talking
about challenges that the Status Quo presents us.
And I was hoping to just spend maybe a second
talking about some of those things.
You know, one of the
opportunities that is presented to us in the next few years is potentially a gas
line and I thought that the governor did a fairly good job of articulating the
concern that we have where if we had a Gas Line or some other major investment
whatever it might be in Alaska that would result in a huge influx of people
into the state of Alaska and a large increased burden on state services and
Can you talk a little bit about how implementing a fiscal policy like this
allows us to maybe restructure the way that we fund and decide the size and scope
of government and how this would allow us
to better maybe be flexible to major positive developments in the state of Alaska
in near future?
Mr. Stickle?
Mr Stickles, you're the lucky one here.
Sure, Dan Sickle, for the record I can take a first stab
So looking at the status quo and for the in terms of status
quo, I'll look at
the governor's 10 year plan that came out with the FY 27 budget
proposal in our fall 2025 revenue forecast.
So oil prices are lower.
And that's that is a fact our revenue forecasts have been have
been coming down.
There's cost pressure on various elements of state government
If we assume that our revenue forecast holds and we pay a
dividend in line with the governor's proposal and fund
government at a fairly stable level the CBR
Our main savings account that we're drawing from the constitutional budget reserve fund
That won't last for long and I think in the in one of the slides that
We presented
We're able to make a CB R draw for 27 and 28 and then it's gone
And so, there is this structural fiscal issue that has to be addressed.
As far as the broader questions around that, it does create uncertainty.
So, we as individuals know that something eventually will have to happen.
We don't know what that is.
So we can't make our plans.
Businesses don t know whats going to decided.
Having some sort of certainty and addressing that that's very difficult to quantify
I know folks at Department of Labor and I sir have tried to quantify that but it is an
Element that solving the fiscal system provides some level of certainty to under to underpin long-term decisions that
Individuals and businesses are making in the state
Thanks for that I think
One of our members talked about how this fiscal cliff is upon us.
I think it's actually been upon
us for quite some time, some would say more than a decade.
We've been aware of these challenges and my experience talking with community businesses.
And other stakeholders is that the instability does have a very negative impact on investment
in our state and our ability to have some stability and even just public confidence
in Alaska.
And I think really we see some of that in the outmigration we currently experience.
You know, one of the other things that has come to mind through all this discussion,
I remember when Musi and Ghatabi was with Eisir years back and he would talk.
Fairly often about one of the challenges we face in Alaska is that we have a large
Outflow of money from the state of Alaska. It's generated here and then goes elsewhere spent elsewhere and flows out of The state
Of Alaska
the representative from Eagle River talked a little bit about
The prospect of us taxing sales that occur outside of Alaskan Alaska and Alaska goes maybe to Seattle to do some spending
Have you looked at as our chief economist, can you speak at all about the impact of
dollars that are spent here in the state and the
impact they have on our economy when they are
spent, here versus what happens when we spend those out of state
and we don't have any mechanism to recapture those dollars or re-home some of those back
into Alaska through some tax mechanism?
Mr. Stickle?
Sure.
Representative Shoggi through the chair, those are good questions.
We do have a fairly transient population.
We rely heavily on outside companies and workers
in some of our industries.
And we do like to go outside the state for college
to get some sunshine in the winter time.
So there is definitely some money that flows out of the
state and money, that falls into the
state, an element of a broad-based tax
Addresses a piece of that so the sales tax is one one element where
You know we're not going to tax the money that Alaskans spend outside of the state, but we would be
generating some revenue from the
The sales of outsiders spending money in in the State generally in The analysis that that we've looked at around
spending and
employment it tends to be that outsiders are spending more in state than in
state folks are spinning outside so by putting in a broad-based tax it would
be a net positive for the state in terms of of just those relationships of where
money is being spent. Thanks I just bring these up to note that I think there are
I think legitimate reasons that we should look there are some there's trade-offs with any policy choice that
We might make in the state of Alaska, and I
Think we've spent a lot of time talking about the concerns
I thing that's very valid there
Are a lotta concerns with this bill and the structure and we're going to have to work through those but I
Think the economic instability that We face the negative business confidence and public confidence
We have in Alaska the out migration
and the outflows of monies that we see from Alaska to other states are all challenges that could be
at least partially mitigated or addressed through fiscal reform like this and so
I think it's an important conversation to have and I I
think its important that remember there are ways that
we can improve our fiscal structure. I'm not sure if this is the way to do it or this package is
Okay, I've got in line here.
We're up to a Bynum Moor,
Galvin, Jimmy, three-minute break,
and then AML starting to maybe think
if there's a way we could hold off on questions.
But let's, we'll go ahead and jump into questions here,
and I'll think about this as we're going along.
But we've about half an hour,
and we'd really like to get AMl up here
so with that we have some Bymum.
Thank you, Coach here Foster.
I know this is a very hot topic.
I saw a bunch of fire chiefs in the building here yesterday.
I was wondering if you might have had them on standby just in case a fire breaks out in here.
So something to keep in mind.
More serious note, we talked a little, I represent Gavin's trying to hit on this a
little bit talking about, you know, people in our communities.
And we've been hearing this undertone about affordability in
the state of Alaska.
I know from my experience in my community, the biggest outmigration is specifically due to the cost of living in the community.
And when I look at this plan, on slide four, one of the big components of this is to create long-term appeal for families and businesses by enshrining a 50-50 PFD.
So the PFD is a major component of what we're actually trying to do here when I'm looking at this
Some of the arguments that I've heard have talked about well
If we in trying a P FD and we have this P F D
Available that when people are paying their taxes that we can transfer that and pay the pfd
And then they'll have the you know
They'll had these big checks and it'll offset that that pain of paying the additional taxes
then I get to thinking about
my community and we're trying to grow the community, and I see in this plan there is absolutely nothing in
this Plan that will create stability in capital investment in the state,
building things,
having people working through that building of things and making life easier for those people by us building
things in doing things. And maintaining things this budget or I'm sorry this plant does absolutely Nothing.
for that that I can see.
What it does is it taxes my community
to ensure that we're in training a PFD, okay?
One of the challenges with that,
and this is not a comment about the validity
of that PFG program,
but if I'm trying to grow my communities
and trying field teacher jobs
and police officers and firefighters,
and I'm not growing from within my own community.
That means people are having to come to my community,
and this tax that would be in place
would immediately be imposed upon them.
Yet they don't have the privileges
of receiving a dividend because they have to wait.
They can be here for over two years
before they see any kind of relief.
So on one hand, we're saying we are creating
an enshrined PFD which will help Alaskans
And then on the other hand, we're seeing that our community is just shrinking and costs continue to go up and people are leaving and
I don't see how we level that with trying to make it more affordable for my community to grow and
This plan does absolutely nothing to do that
so
When you did the evaluation on this and we were talking about trying, to, grow Alaska and keep our communities healthy
Was that something that was considered as part of?
the calculus, because like I said, this is to transfer funds from collected taxes directly
into the dividend program that's been enshrined into Constitution.
Was the element that I just spoke about where we were trying to grow our communities?
Was that taken into consideration?
Because many of those members are never going to, maybe we have members in our community
that don't get the PFD, or they won't give it for many years.
was that something considered?
Commissioner Earls?
Through the chair to Representative Bynum,
I would have to see if there was any economic research done
on the impact to people leaving the state.
I'm not sure that that was completed.
Mr. Stickle sure Dan Stickles through the chair to representative by my my numb
You know broadly speaking yes, we've modeled impacts of permanent fund dividend
taxes spending
The sustainable fiscal plan would provide a stable source of revenue for a variety of government spending to include
dividends to Alaskans to conclude
providing government services
such as capital budget education
Governor has been clear that providing a dividend is a priority and when he set the
The fiscal plan that he put forward that was a core part of the fiscal Plan
So follow up follow thank you through the chair
I hear what you're saying there, but when we look at this plan
There's absolutely no way that we're actually doing any capital investment. We're not doing capital. Investment now
We are not maintaining operational expenses now
So nothing here is actually causing that to happen, but we're putting more burden on our communities to pay taxes
and
One of the things that I find really challenging to understand with this plan is on one hand
We're saying we want to have stability by imposing a sales tax because oil revenues are volatile
Then on the other hand we are saying but just wait seven years
And we're going to go back to that volatility, because that's
OK.
So I'm not sure if it's, I am not
sure that I understand that what we are saying, sales tax
is because it is not volatile, but after seven years,
that is going go away.
And I know that we were saying we will have additional resources
coming online in the future.
But the predictions and projections we have on here the 10-year don't show that we're going to create additional revenue
We just created permanent liability like represent staph was pointing out permanent LiBility
for us with the
Deficites into the future and and no investment in capital in this state
So I just I'm finding it really challenging to to link the the concept of
Stability through sales tax, but then we're just gonna get rid of it in the future and gonna depend on what we currently do
Thank you
Okay
Okay, the last two we've got Ruppson of Galvin and Jimmy and then will go to our break and have Amal come up
And Rupson and Moore's passing she might have been first Rumpson or Moore is passing
Rups in Galvan
Thank you, co-chair Foster, I appreciate it.
I have a couple of questions again around the sales tax.
And this one in particular is around
the implementation of the sale's tax I did a little bit of research
back when I was thinking about the broader picture of how important broad-based
revenue will be to our state given diminishing revenue.
currently. And in that work, what I found was that it was pretty simple from a sale income
tax point of view just because you take or you could, depending on how you want to pull
the levers, you can just take one line from the federal income tax that everybody fills
sales tax, which puts a bit of work on all of the local businesses.
And so I was thinking about this and I don't see any slides on implementation and what that might look like,
costs of implementation, things like that.
And the idea of standing it up and then taking it away feels burdensome as well.
I wondered if you could speak to that initially.
I know that, and I want to add one other caveat that what I had in place when looking at an income tax was that if they wanted to pay their income
tax with their PFD, they could just place that check mark on the online tax.
form and so this feels a lot different to me and we're putting the burden absolutely on
Businesses and, so would you help me with that piece the cost of implementation and
It's kind of what that's going to look like to stand it up and then shut it down
Let's just bond us through the chair representative Galvin. I think for the question
I don't think we are going, to get to the fiscal note in our slides, but that is where the costs are
embedded and
We maybe can come back and talk about that at another time.
But generally speaking, a sales tax is not simple.
It sounds simple, this body a decade ago passed sales
tax or rather income tax that did not pass the Senate.
What one that we did a lot of work on internally it is a complicated mechanism it requires as much if not more employees that that were expecting here this bill.
I believe we landed on 60 60 was it four or seven employees for the for
the plan.
Yeah, 67 I saw 34, but that's a year one.
So 67 employees, for this there, I'd believe it was 72 for an income tax.
you have a fiscal note on that from us and I just can't remember it off the top of my head.
So they're roughly the same as far as implementing. It's about 10 million a year for
this cost of having those employees and other costs associated travel, etc. for doing audit programs.
And if I may have follow-up.
Representative Galvin.
Were you, did you consider costs to businesses each,
you know, that there would be perhaps
an extra level of consideration
with regard to the local businesses
who may or may not have more paperwork
or things associated with that
as a business owner or business worker?
I understand that for the state costs,
it would one piece, but I'm thinking
it's like the multiplier effect of other pieces to it.
Certainly after the chair representative Galvin the costs for for implementing a sales tax of the local business
Especially one that already has a tax at the Local Level is
Is miniscule they their systems are already set up even if they're in a city like anchors that doesn't have a sale stacks
This systems the point of sale system has the sales Tax built into it all they have to do is turn it on turn
It on okay. Thank you. That's good to understand. I appreciate that and
the other
Consideration if I may have a follow-up. I think on a previous site or previously in this presentation you mentioned that
Taxes like income taxes may be volatile because they're dependent upon what we think about
future
Overall issues with relation to our
economy, whether it's up or down, and so there was some discussion around how that is somewhat
volatile, I would think similarly with sales tax, there's some volatility as well.
I guess what I wanted to ask you is that when I think about that sort of volatility, if
we're projecting out that there is at some level of confidence that the sales taxes are
Then aren't we also saying that we have some level of confidence that the oil fields and
other areas are going to continue to bring us some positive returns?
I think in our outlook, the reason that were de-escalating not only corporate income tax,
but also were desalating the sales tax in this model,
other revenue to come in heavier, for example, our oil revenue.
And of course, that's considering that we think the oil price will be predictable.
And if that is the case, then I would think that, we should consider
that will still have the high revenue workers in place in Alaska.
working on the oil fields, and I just want to make sure that you would agree with me that if we think we're going to get oil revenue in the next ten years escalating,
that we also would be workers on those oil field maintaining some level of high income.
And follow up to that particular question.
And if you have done any research on the overall revenue from oil and gas work field.
Work, I guess work revenue, workers revenue wage revenue.
What percentage of the wage what revenue comes from out of state workers?
I'd be surprised, actually Dan always surprises me though.
So we do that modeling, but we didn't bring that.
We weren't prepared to talk about an income tax today.
I appreciate that, but as we're considering one versus the other and whether how to best
fill a hole, I think at some point, if we can hear numbers, that will help us make decisions.
A lot of Alaskans think that it's not right,
that people work, come up here and take the very best, highest jobs,
highest paying jobs and yet they don't put in to Alaska. And I
appreciate some of your thoughts that well, maybe they're going to be buying
Tents and things if they come up here, but I want to make sure that we're being mindful and thoughtful about what that bottom
Number really looks like so I would appreciate it as being part of this conversation
Because chair as you know
This is a bigger conversation that
We have many levers to pull and we want make
Sure we are pulling the right ones that are appropriate for the revenue that
We need now and in the long-term
Jimmy
Yes, thank you
Chair Foster, before I get in, I'd just like to give a shout out to the Akotan Takukon tribe for allowing us to conduct state business on their land, going to check the taxes.
So I grew up not knowing about taxes, you know, get my little dollar, 25 cents, go buy my pop in Kenya, not know I was paying a tax as a kid.
Not when I know that I'm upset about that.
But as we got our business, and then I started understanding about tax.
It's a pretty unique situation.
We pay taxes on stuff that garches that are flowing,
building materials, and that freight is also included
with the taxes.
So on top of that, our business have to make money.
So they put, they add on to more, as you guys are well aware,
sometimes two, three, four, five times more
than what we are, their purchase that.
And from what I understand, we pay tax is in the rule.
Urban does not, and we pay year-round tax.
So with seasonal income, meaning sometimes corporations come in or entities come
in and help provide jobs and somebody only works for like six weeks and then the rest
of the year they have no income.
determine their over income, in fact, when they're still struggling to make a good paycheck in the rule,
but yet they are still struggled to pay for fuel, food, and still try to seek assistance in their denied,
so then it puts another burden on the family, so they still are struggling.
Excuse my voice. So from what I'm understanding, this tax, we would be paying more.
And receiving less back in my own village in
My village communities
I'm sure you guys are well aware of we had typhoon hailong and
A lot of homes in My district were damaged
Out of the bush. We can't have insurance. I am sure. You guys. Are aware that
There's nothing to file female help support people in the immediate moment
It wasn't designed to rebuild homes. It was designed
to help repair homes, and this is not to, like, you know,
extend the house.
It's to not build a man cave or a woman cave.
It is to repair where they have been living for generations.
Some of these homes were passed down, were built originally
and passed from their parents, which means a lot.
So many people have to pay out of pocket.
For building supplies repair our homes. Yes, but also for subsistence gear
for snow machines for four wheelers for our boats
That are our lifelines they help us subsistence out in the room
And you know basic things and it all comes in by planar barge
With this proposed statewide tax sales tax a tax that would apply to freight to
By the time those items reach my village, my communities,
my constituents, it's going to cost 2, 3, 4 times more over
than an urban area.
I'm not an economist, so I am asking honestly,
how is a statewide sales tax meant to be equal
costs for the same basic necessities,
especially after a disaster.
Commissioner Earls.
Representative Jimmy through the chair.
I've heard that concern from others,
and I think it spreads across all of the state.
We have.
I rural Alaska for sure and has high costs a lot of Alaska has
high cost and I'm not exactly sure how to answer every single individual
Alaskans answer. If I may add to that spot us Mr. Chair Representative Jimmy
there are places in Alaska that are more expensive, rural Alaska is more
expensive than urban Alaska. To reiterate what the commissioner said earlier, our
acting commissioner, said, earlier is that there is no perfect tax regime. It's
difficult to build equity into a flat tax, like a sales tax. There were, there
is an exemption for construction, at least. So for building of the homes,
to that. And as I mentioned earlier, there's, you know, a discussion can be had about other
exemptions. But again, the current structure is a very broad base to allow for a low rate for
rural Alaska, not just for rural, Alaska for all Alaska but it benefits rural
Alaska to have that low-rate. So, but again no perfect tax regime. We wish we weren't here
That that's the situation we're in
We're upset Jimmy
So a family lost their whole house their all their clothing all there everything from memories to what they
Purchase to like which is inexpensive to ship out items
So what you're telling me is my constituent who has to who lost her home?
Has no job has no other way to pay for any of her bills as her homes being repaired
She's selling her own dry fish just to make ends meet.
So you're telling me, hey, you gonna have to go and pay?
We all know eggs cost about 20 bucks for a box.
So now it's $80 and she's gonna pay sales tax to her village,
which it should be paid because it is gonna help the village run.
But not also that she is going to have
to help pay a tax that will not benefit rule but urban.
That's what you guys are telling.
So through the chair representative Jimmy what we're saying is we were having this conversation
It would be upon you to pass the tax and in which case then yes as the Tax Administrator
Then I would Be telling their your constituent they would have to pay the text until the
Tax becomes law what We're Saying is here's a solution that the Governor is proposing and
Having that conversation
Well if this does pass I really hope you guys there will be willing to help me write
What I need to tell my people at home and make it okay, because it is not okay.
It is okay for my constituents who is barely surviving, have to help and pay for this kind of tax.
I just want to put it out there, thank you.
Thank you, and I guess I just want to say that I share representative Jimmy's concern because it sounds like a sales tax is is equal
Everybody pays the same 4% for example
but you know when you've got
Cost of milk and cost of fuel and costs of groceries and costing everything
higher up in Alaska that same gallon of Milk is really being taxed more because if it's
Ten dollars for the gas and milk is I mean for that gallon and Milk as opposed to
Five dollars in other parts of the state then four percent of ten dollars is obviously more than
Four percent five dollars. So anyway, just want to say I appreciate your concern
We'll go to one last comment here up some of allerd and then what my plan is is to I
Think
Technically, I don't know for a recessing or we're just a journey, but we will take up AML at the 130
and so
I think that means I can adjourn, so would that represent a valor?
Thank you, I just quick comment to follow up on representative Jimmy.
I understand about the whole community, we lost several houses.
People lost everything in Eagle River with the earthquake we had,
I believe it was 2018, that November.
And unfortunately, they still had to pay property tax.
And so, my district's also impacted, but we hate property tax, and I think most of the rural communities don't.
And I have people in my District that pay anywhere between 10 and 15,000 in property taxes.
So, I would forgo property in a heartbeat and pick up the sales tax.
So if you can make that happen, i would appreciate it.
Thank you.
we'll figure out what our schedule is regarding going back to the other two
sections that we need to cover as well as the fiscal note I know you also have a
sectional in there aswell but I think we're hitting the the high points pretty
well so we might not need the section all but with that any final comments from
the committee or Department of Revenue represent Jimmy yes I just wanted to
with Representative Allard, are property taxes, local taxes?
That question is for Rux and Ballard.
Oh, I apologize, can you speak closer?
Okay, say it again.
Are property taxes,
local tax is not statewide taxes.
The property, taxes come from the municipality of Anchorage, yes.
Okay. Thank you for clarifying.
Yeah, you're welcome.
Thank You.
Any representative Biden?
So cut your foster, appreciate this.
Obviously, this is a very big topic.
The major components of this bill is the sales tax portion of it.
There are other measures in it that are worthy and important to talk about, but
when we go to, I just want to make sure we're going to have enough time to really come back.
Stop where we stopped and really be able to dive into this.
Is that the intention?
There's a lot, yes, you're absolutely correct.
There is a there's
Here, I think in terms of the questions that the folks have,
in some of some the analysis that folks are asking for,
this is definitely not the last conversation.
And so I I the intent right now is to try to get the high level
out there, the components of what the main point is.
And then we're also going to go to take up some public testimony tonight.
I think that'll be focused.
Most folks seem to be concerned about the sales tax portion.
And so we'll focus on that when we go to public testimony tonight
We can still come back to Public testimony in the other sections of the bill
Maybe at a later time because we are not going to have a robust conversation about those pieces
But certainly with regard to your concern about the sales tax portion
This is some you know, there'll be more opportunities talk about it resident of item
for clarity. So this afternoon we're going to come back at 1.30 and we'll get a presentation
from AML. Will we also be here? Will that be our only item of business for this particular?
That meeting we are supposed to have, I believe, ASME and ATIA at that meeting. It's today
Thursday. Yes, both Alaska travel industry. We're gonna take up,
I think, AMO first, probably maybe the first hour or so, and then the last half we will
So we had two other questions represent of Tom Seske and then Galvin represent Tom seski. Thank you co-chair foster through the chair
I just want to thank the department for being here today and and with a really difficult task of a
fiscal plan I
Since I've been in this building for the past three years
The constant drum beat has been
What is Alaska? What are we doing for a fiscal plan and how are
we going to make our ends meet? How are
we gonna make the budget balance? And I really
thank the governor for bringing this difficult
subject to us. You know, it does take strong
leadership in in your department in the in
the state. And i just thank you guys all for for
doing that. It's it's gonna be a difficult
conversation and I look forward to having the time to really dig into all the all
the aspects of this fiscal plan. So thank you all for being here. Thank you.
Ripsing of Galva.
Thank
you very briefly. I just wanted to make sure to for the record. Um I know I had
asked questions that we didn't have recent data for around out of state.
Employee wages and how much in all and I wanted to give some reference to that because it's so important as we're thinking about our options and our levers and so I'm going to
give you data from 2024 if I may at that time in 2024 we had 413,867 people working in Alaskan for at some point in the year.
And 22.9% were non-residents of that.
The nonresidence earned approximately $3.8 billion,
or 17.3% of total wages.
This does not include our newer projects that would be PICA.
That would willow willows now at about 50% and of course that
would not including the project that's coming, we think perhaps the gas pipeline that
would have 10,000 workers and they're estimating.
50% would be from out of state, so that's another 5,000 workers.
All of those they've estimated are at $175, 000 per year wage roughly.
So I just want to make sure that we are getting all the information at the table
as we include these very difficult conversations and decisions.
That information came out on Monday and it does not include federal employees.
So I want to make sure to clear the record on that.
So some of the federal wages are quite high,
but anyhow, I wanna make that we are thinking about
all of our choices, what will impact,
especially the more vulnerable Alaskans in rural Alaska,
less, and we do have a lot of options on the table,
and they're all gonna be difficult,
but some are more fair than others.
Thank you so much for allowing me to put that on record.
Appreciate it.
Last word, Commissioner Earls, do you have any comments
or any of your counterparts?
Thank you, Chair Foster.
I'm not sure if my counterparts do,
but thank you.
It's a difficult conversation.
It is hard to be here,
but we're happy for the interaction.
So, I mean, it-
Discussion.
The discussion, yeah.
And getting the questions out there for everyone.
Appreciate your being here definitely a robust conversation. It's a conversation that needs to be had and so
Again, thank you for being there
And so going forward here as I mentioned will have AML first at 130. I'm sorry AM L giving kind of the I
Assume the counterpoint or at least raising some concerns about the sales tax and and from a
From the local standpoint representing the Local Communities
And then we'll go to ASME and ATIA, that's the seafood and travel industries.
At 530, so at that point, we will have the discussion on the table regarding the sales tax.
So I would encourage the public if we maybe could focus on that as we go into public testimony at 5.30.
And that is going to be again on House Bill 284, the Almond Abyss Tax Bill.
We do anticipate a number of people calling in.
I want to make sure that folks are able to get their comments
on the record if they're wanting to call in,
so if folks could maybe limit their testimony to two minutes.
Folks also have the ability to email us their
comments and those can be sent to us at house.
dot finance at a k l e g dot gov i'll be repeating that often during our
testimony so with that if there is nothing else to come for the committee
we'll see you all at one thirty and then five thirty department of revenue
commissioner thank you for being here we will be adjourned at eleven oh six a.m.