WORK SESSION: HB 2705

 

PUBLIC HEARING: HB 3397, HB 3398, HB 3134

 

TAPE 108-109, A-B

 

HOUSE REVENUE COMMITTEE

April 4, 2003†† 9:00 AM†† STATE CAPITOL BUILDING

 

Members Present:††††††††††† ††††††††††† Representative Lane Shetterly, Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Wayne Scott, Vice Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Joanne Verger, Vice Chair

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Mark Hass

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Elaine Hopson

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Max Williams††††††††††† ††††††††††††††††††††††† †††††††††††

 

Members Excused:††††††††† ††††††††††† Representative Phil Barnhart

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Vicki Berger

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Pat Farr

 

Witness Present:††††††††††† ††††††††††† Patti Milne, Marion County Commissioner

††††††††††††††††††††††† ††††††††††† ††††††††††† James Balkema, Marion County

††††††††††††††††††††††† ††††††††††† ††††††††††† Toni Balkema, Marion County

††††††††††††††††††††††† ††††††††††† ††††††††††† John Phillips, Department of Revenue

††††††††††††††††††††††† ††††††††††† ††††††††††† Diane Belt, Oregon Association of County Tax Collectors

††††††††††††††††††††††† ††††††††††† ††††††††††† John Blatt, Association of Oregon Community Development Organizations

††††††††††††††††††††††† ††††††††††† ††††††††††† Representative Kelly Wirth, District 16

††††††††††††††††††††††† ††††††††††† ††††††††††† Jason Williams, Oregon Taxpayers Association

††††††††††††††††††††††† ††††††††††† ††††††††††† Joe Schweinhart, Associated Oregon Industries

††††††††††††††††††††††† ††††††††††† ††††††††††† Senator Gary George, District 12

††††††††††††††††††††††† ††††††††††† ††††††††††† Marcia Kelley, Womenís Rights Coalition

††††††††††††††††††††††† ††††††††††† ††††††††††† Tom Potiowsky, Office of Economic Analysis

††††††††††††††††††††††† †††††††††††††††††††††††

Staff Present:††† ††††††††††† ††††††††††† Paul Warner, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Lizbeth Martin-Mahar, Legislative Revenue Office

††††††††††††††††††††††† ††††††††††† ††††††††††† Tara Lantz, Committee Assistant

 

TAPE 108, SIDE A

 

004

Chair Shetterly

Calls meeting to order at 9:12am.

 

OPENS PUBLIC HEARING ON HB 3134

 

015

Paul Warner

Explains HB 3134 which grants counties the right to sell tax lien certificates on properties to investors. Exhibit 1.

 

 

 

028

Patti Milne

Testifies in support of HB 3134 because it maximizes what it owed to county tax districts in a time when local budgets are shrinking. Refer to written testimony. Exhibit 2.

 

 

 

086

James Balkema

Testifies in support of HB 3134 because it would bring in money to counties and increase tourism. Discusses his experiences investing a similar program in Arizona. Refer to written testimony. Exhibit 3.

 

 

 

163

J. Balkema

Walks through how the program would work for one property.

 

 

 

185

Rep. Shetterly

Asks what the statutory rate for lien delinquency is in Oregon.

 

 

 

186

J. Balkema

Responds 16 percent.

 

Discussion follows.

 

 

 

224

Toni Balkema

Discusses the process of the lien certificate program.

 

Discussion follows.

 

 

 

251

Rep. Shetterly

Asks who is responsible for taxes that arenít paid in the future.

 

 

 

253

J. Balkema

Responds that the investor could sub-tax to keep an investor from buying the certificate.

 

 

 

278

Rep. Hass

Asks how this program would improve the situation for delinquent taxpayers.

 

 

 

280

T. Balkema

Responds that it would not make their situation any better but would also not make it worse.

 

 

 

302

Rep. Shetterly

States that the process would not change except that the investor would take the debt off the hands of the state.

 

Discussion follows.

 

 

 

318

Milne

Clarifies that it relieves the county from uncollected debts.

 

Discussion follows.

 

 

 

356

J. Balkema

Points out that if the bill passed a lot of delinquent taxpayers would pay the owed debts to keep investors from coming in and foreclosing on property.

 

 

 

375

J. Balkema

Discusses figures on delinquent property taxes in Marion County.

 

Discussion follows.

 

 

 

404

Rep. Verger

Asks about bankrupt properties.

 

 

 

405

J. Balkema

Responds that bankrupt properties are not allowed to be sold until the bankruptcy goes through and that even after that they are seldom sold.

 

Discussion follows.

 

TAPE 109, SIDE A

 

010

Milne

Points out that this program could turn around the health of the general fund for Marion County.

 

 

 

035

John Phillips

Explains HB 3134 and gives figures on delinquent taxes for all counties in Oregon. Discusses issues of concern for the Department of Revenue. Refer to written testimony. Exhibit 4.

 

 

 

203

Diane Belt

Testifies against HB 3134 because it could decrease funding for assessment and taxation and would create more administrative duties for county offices. Refer to written testimony. Exhibit 5.

 

 

 

255

Rep. Shetterly

Asks why it would work better for small districts.

 

 

 

257

Belt

Responds that it would benefit the districts where the taxes were owed. Discusses the administrative costs that would be placed on the counties.

 

 

 

286

Rep. Shetterly

Asks if it would be acceptable to have it on a county by county basis.

 

 

 

289

Belt

Responds that it would create an inconsistency in the statewide process of foreclosing if one or a few counties offered tax lien certificates.

 

 

 

315

Rep. Verger

Asks how this bill would be taking advantage of a person who refuses to pay their taxes.

 

 

 

335

Belt

Responds that many of the people she talks to donít refuse to pay their taxes, but are unable to pay them.

 

Discussion follows.

 

TAPE 108, SIDE B

 

002

John Blatt

Testifies that this bill would not have much of an affect on non-profit organizations. Offers personal support for HB 3135 because he feels it makes sense from a financial standpoint. Recommends selling the interest on the income and not the asset.

 

CLOSES PUBLIC HEARING ON HB 3135

 

OPENS PUBLIC HEARING ON HB 3397

 

102

Paul Warner

Explains HB 3397 which modifies statute allocating surplus kicker refund to individual income taxpayers, limiting the amount of surplus refund for taxpayers with prior year liability above $80,000 and increasing the percentage of refund for those with less than $80,000. Exhibit 6.

 

OPENS PUBLIC HEARING ON HB 3398

 

125

Rep. Wirth

Introduces HB 3397 and HB 3398. Gives history of the kicker refund and discusses the intent of the bills. Refer to written testimony. Exhibit 9.

 

 

 

286

Rep. Verger

Asks if the bills would be allowed by the constitution.

 

 

 

290

Warner

Responds affirmatively.

 

 

 

305

Jason Williams

Testifies in opposition to HB 3397 because he disagrees with redistributing wealth.

 

362

Rep. Hass

Asks if Williams is opposed to HB 3398.

 

 

 

367

Williams

Responds that they havenít had enough time to look at it but that if it does not redistribute wealth in an unfair manner they would probably not have problem with it.

 

 

 

389

Rep. Shetterly

Points out that in general the income tax system penalizes income earning.

 

 

 

394

Joe Schweinhart

Testifies that people who get more money back from the kicker refund pay more taxes and should not be penalized.

 

TAPE 109, SIDE B

 

005

Sen. George

Testifies against SB 3397 because the state shouldnít penalize people who pay higher taxes and it would decrease credibility from the public which voted for the kicker refund.

 

 

 

044

Marcia Kelley

Testifies that there are substantial tax breaks for people who are high income earners and that wealth should be distributed to help people who are out of work and poor.

 

CLOSES PUBLIC HEARING ON HB 3397 and HB 3398

 

OPENS WORK SESSION ON HB 2705

 

065

Warner

Discusses changes made in the proposed amendments.

 

 

 

130

Tom Potiowsky

States that the office of economic analysis is moving ahead and forming an advisory revenue forecast board.

 

 

 

165

Rep. Verger

States that she will not be voting for the bill because she does not support an advisory board.

 

CLOSES WORK SESSION ON HB 2705

 

180

Rep. Shetterly

Adjourns meeting at 10:47am.

 

 

 

 

 

Tape Log Submitted by,

 

 

 

Tara Lantz, Committee Assistant

 

Exhibit Summary:

1.†† HB 3134, Paul Warner, Staff Measure Summary, 1p.

2.†† HB 3134, Patti Milne, Written Testimony, 2pp.

3.†† HB 3134, James Balkema, Written Testimony, 12pp.

4.†† HB 3134, John Phillips, Written Testimony, 6pp.

5.†† HB 3134, Diane Belt, Written Testimony, 4pp.

6.†† HB 3397, Paul Warner, Staff Measure Summary, 1p.

7.†† HB 3397, Paul Warner, Kicker Rebates by Liability Class, 1p.

8.†† HB 3398, Paul Warner, Staff Measure Summary, 1p.

9.†† HB 3397, Rep. Wirth, Written Testimony, 5pp.

10. HB 2705, Paul Warner, Proposed HB 2705-1 Amendments, 3pp.

11. HB 2705, Paul Warner, Proposed HB 2705-2 Amendments, 6pp.