WORK SESSION

SB 480 A, SB 896 A,

SB 996 A, HB 3481 A

 

TAPES 192-193 A-B

 

HOUSE REVENUE COMMITTEE

JUNE 14, 2005   1:00 PM   STATE CAPITOL BUILDING

 

Members Present:                      Rep. Tom Butler, Chair

                                                Rep. Vicki Berger, Vice-Chair

                                                Rep. Mark Hass, Vice-Chair

                                                Rep. Brian Boquist

                                                Rep. Sal Esquivel

                                                Rep. Larry Galizio

                                                Rep. Betty Komp

                                                Rep. Andy Olson

                                                Rep. Chuck Riley

 

 

Staff Present:                          Paul Warner, Legislative Revenue Officer

                                                Lizbeth Martin-Mahar, Economist

                                                Kristi Bowman, Committee Assistant                                            

                                                                                               

                                                                                   

 

TAPE 192, SIDE A

002

Chair Butler

Calls meeting to order at 1:05 p.m.

 

 

 

OPENS WORK SESSION FOR SENATE BILL 996 A

 

 

 

018

Chair Butler

MOTION: REP. BERGER MOVES THAT THE VOTE BY WHICH SB 996 A WAS PREVIOUSLY PASSED TO THE FLOOR WITH A DO PASS AS AMENDED RECOMMENDATION BE RECONSIDERED IN ORDER TO CONSIDER A CONFLICT AMENDMENT.

 

 

 

019

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, RILEY, BERGER, BUTLER. EXCUSED: GALIZIO, HASS.

 

 

 

023

Paul Warner

Discusses the conflict amendment SB 996 A-3 (Exhibit 1). It does not change any of the policy decisions made by the House Revenue Committee when the bill was heard on 06/01/05.

 

 

 

032

Chair Butler

MOTION: REP. BOQUIST MOVES TO ADOPT THE SB 996 A-3 AMENDMENT.

 

 

 

035

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, RILEY, BERGER, BUTLER. EXCUSED: GALIZIO, HASS.

 

 

 

036

Rep. Berger

MOTION: MOVES SENATE BILL 996 A AS AMENDED TO THE HOUSE FLOOR WITH A DO PASS RECOMMENDATION.

041

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 7-0-2. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, RILEY, BERGER, BUTLER. EXCUSED: GALIZIO, HASS.

 

 

 

CLOSES WORK SESSION FOR SENATE BILL 996 A

 

 

 

OPENS WORK SESSION FOR SENATE BILL 480 A

 

 

 

053

Warner

Discusses the changes incorporated in the SB 480 A-12 amendment. (Exhibit 2). The changes include:

  • ·         Clarifying the definition of “listed transactions”
  • ·         Defining reportable transactions
  • ·         Modifications to penalties imposed
  • ·         Modifications to the Voluntary Compliance Initiative (VCI)

 

 

 

092

Chair Butler

Discusses the definition of “listed transaction” with Warner.

 

 

 

100

Warner

Continues summary of changes in the amendment.

 

 

 

124

Rep. Hass

Asks about the intent of the change to the VCI.

 

 

 

125

Warner

Responds that there was confusion between listed and reportable transactions and their respective “look-backs”. Continues summary of changes in the amendment.

 

 

 

155

Rep. Hass

Asks how the California amnesty model affects the bill’s look-back for reportable transactions.

 

 

 

158

Warner

Discusses the California look-back policy.

 

 

 

178

Rep. Komp

Asks if the amount of years for a look-back is critical to the overall benefit of the amnesty program.

 

 

 

186

Warner

Responds that there are trade-offs to the length of look-back. The further you go back, the more burdensome it is on taxpayers for recordkeeping. The SB 480 A-12 amendment shortens the 8 year time period to 6 years.

 

 

 

207

Warner

Comments that the SB 480 A-12 amendment does not affect the revenue impact estimate from the SB 480 A-11 amendment (Exhibit 5 dated 05/31/05)

 

 

 

219

Rep. Galizio

Asks about the proposed Dept. of Revenue Internet site for tax abusers.

 

 

 

230

Rep. Berger

Responds that the Internet proposal was eliminated in the SB 480 A-12 amendment because all of the information is public information and is available already. Expresses concern that The “Wall of Shame” Internet site exposes the state to liability if the information is wrong. There is an easier way to get that information to those concerned.

 

 

 

244

Chair Butler

Additional comments about the proposed website for tax abusers.

 

 

 

257

Rep. Berger

MOTION: TO RESCIND THE SUBSEQUENT REFERRAL TO WAYS AND MEANS AND REQUEST A SUBSEQUENT REFERRAL TO HOUSE BUDGET.

 

 

 

265

Rep. Hass

Asks about the intent of the referral of the bill to the House Budget Committee.

 

 

 

271

Chair Butler

Responds that a discussion about the amount of penalties needs to be addressed in the Budget Committee. Discussion with Rep. Hass.

 

 

 

303

Rep. Boquist

Asks about the fiscal impact.

 

 

 

304

Warner

Responds that the fiscal impact is estimated @ $600,000 because of the elimination of the website. The fiscal impact has been coordinated with the Dept. of Revenue’s budget.

 

 

 

330

Chair Butler

Asks for roll-call vote.

 

 

 

340

Chair Butler

ORDER: THE MOTION HAVING RECEIVED THE REQUIRED MAJORITY IS DECLARED PASSED. VOTE: 6-3-0. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, BERGER, BUTLER. VOTING NO: GALIZIO, RILEY, HASS.

 

 

 

347

Rep. Berger

MOTION: MOVES THE ADOPTION OF THE SB 480 A-12 AMENDMENT. 

 

 

 

352

Rep. Berger

Comments on her reason for not supporting the website. Supports the referral to the Budget Committee in order to have another group look at the bill.

 

 

 

368

Rep. Galizio

Comments on the website issue. Acknowledges the additional costs to develop and maintain it and states that negative publicity is a strong motivator.

 

 

 

394

Chair Butler

Asks for roll-call vote.

 

 

 

403

Chair Butler

ORDER: THE MOTION HAVING RECEIVED THE REQUIRED MAJORITY IS DECLARED PASSED. VOTE: 6-3-0. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, BERGER, BUTLER. VOTING NO: GALIZIO, RILEY, HASS.

 

 

 

407

Rep. Berger

MOTION: MOVES SB 480 A WITH A DO PASS AS AMENDED RECOMMENDATION, AND THE BILL BE REFERRED TO THE HOUSE BUDGET COMMITTEE.

417

Chair Butler

Asks for roll-call vote.

 

 

 

427

Chair Butler

THE MOTION HAVING RECEIVED THE REQUIRED MAJORITY IS DECLARED PASSED. VOTE 7-2-0. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, RILEY, BERGER, BUTLER. VOTING NO: GALIZIO, HASS.

 

 

 

CLOSES WORK SESSION FOR SENATE BILL 480 A

 

 

 

OPENS WORK SESSION FOR SENATE BILL 896 A

 

 

 

TAPE 193, SIDE A

020

Lizbeth Martin-Mahar

Gives overview of the SB 896 A-4 amendment (Exhibits 3 and 4).  The amendment increases the tax credit to $5000 and establishes a sunset date of 01/01/13.  

 

 

 

035

Chair Butler

Comments that the amendment clarifies the definition of water vessel that is eligible for the tax credit.

 

 

 

047

Martin-Mahar

Adds that the amendment does not have a significant revenue impact (Exhibit 5).

 

 

 

057

Chair Butler

REP. RILEY MOVES THE ADOPTION OF THE SB 896 A-4 AMENDMENT.

 

 

 

060

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 8-0-1. VOTING AYE: BOQUIST, GALIZIO, KOMP, OLSON, RILEY, BERGER, HASS, BUTLER. EXCUSED: ESQUIVEL.

 

 

 

063

Martin-Mahar

Gives overview of the SB 896 A-5 amendment (Exhibits 6 and 7). In addition to the components of the SB 896 A-4 amendment, it includes a property tax exemption for newly acquired real or personal property. The company must pay taxes on the first $1 M and is exempt from taxes above that amount. The amendment establishes a sunset date.

 

 

 

086

Chair Butler

Clarifies the property tax component in the amendment. Discussion with Martin-Mahar.

 

 

 

100

Rep. Riley

Clarifies the definition of newly acquired or newly constructed property eligible for exemption.

 

 

 

108

Rep. Olson

Asks why the exemption is not facilitated by a local agency instead of a state agency.

 

 

 

128

Rep. Berger

Expresses similar concerns to Rep. Olson’s about the property tax exemption.

 

 

 

 

147

Rep. Esquivel

Expresses concern about the two sunset clauses. In response to Rep. Olson and Rep. Berger, this bill is not designed for local control.

 

 

 

160

Chair Butler

General comments about the revenue impact of increased assessed valuation of property.

 

 

 

179

Rep. Boquist

Asks about the revenue impact statement (Exhibit 8) for the SB 896 A-5 amendment.

 

 

 

182

Martin-Mahar

Explains the property tax component. Discussion with Rep. Boquist and Rep. Berger.

 

 

 

300

Chair Butler

Comments on assessed value on vacant buildings.

 

 

 

370

Rep. Berger

Expresses concern about the property tax component and its effect on small communities.

 

 

 

390

Chair Butler

General comments about the SB 896 A-4 amendment.

 

 

 

421

Rep. Boquist

MOTION: MOVES SB 896 AS AMENDED TO THE HOUSE FLOOR WITH A DO-PASS RECOMMENDATION.

 

 

 

434

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. THE MOTION PASSES 9-0-0. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, KOMP, OLSON, RILEY, BERGER, HASS, BUTLER.

 

 

 

CLOSES WORK SESSION FOR SENATE BILL 896 A

 

 

 

OPENS WORK SESSION FOR HOUSE BILL 3481 A

 

 

 

TAPE 192, SIDE B

025

Martin-Mahar

Gives overview of HB 3481 A-6 amendment (Exhibit 9). The changes:

  • ·         Clarifies definition of new property
  • ·         Clarifies definition of farm storage facilities
  • ·         Biofuel facilities will conform to Dept. of Environmental Quality (DEQ) standards
  • ·         New definition of “agricultural producer”
  • ·         Decrease of tax credit for biomass production

 

 

 

093

Rep. Hass

Discussion with Martin-Mahar on the tax credit reduction pertaining to research and development.

 

 

 

108

Martin-Mahar

Comments that bill’s property tax exemption is designed to be used after the enterprise zone exemption is depleted. The company would need to get consent from the local government. 

 

 

 

141

Chair Butler

Asks about the wood chipper issue.

146

Martin-Mahar

Responds that Legislative Counsel advised that because of the relating clause in the bill regarding expansion of environmental improvements, the deletion of wood chippers from the bill cannot be done.

 

 

 

150

Rep. Berger

Asks about the definition of biomass.

 

 

 

155

Martin-Mahar

Responds that the definition is on pages 34 and 38 of the amendment.

 

 

 

174

Martin-Mahar

Discusses the revenue impact statement (Exhibit 10) pertaining to the property tax exemption for biofuel production or fuel additive production facilities.

 

 

 

281

Rep. Hass

Comments on the pollution control credits currently being claimed. Discussion with Martin-Mahar.

 

 

 

300

Chair Butler

Comments on growth and expansion of the biofuel industry and the revenue impacts. General comments on the amendment.

 

 

 

357

Rep. Berger

MOTION: MOVES THE ADOPTION OF THE HB 3481 A-6 AMENDMENT.

 

 

 

373

Chair Butler

ORDER: THERE BEING NO OBJECTION, THE CHAIR SO ORDERS. MOTION PASSES 9-0-0. VOTING AYE: BOQUIST, ESQUIVEL, GALIZIO, KOMP, OLSON, RILEY, BERGER, HASS, BUTLER.

 

 

 

376

Rep. Berger

MOTION: MOVES HB 3481 A AS AMENDED TO THE HOUSE FLOOR WITH A DO-PASS RECOMMENDATION.

 

 

 

383

Rep. Hass

Discusses legislation in 2001 regarding the extension of the pollution control credit. To extend a credit that is not used by 70% of the industry “seems like the wrong way to go.”  Expresses concern that the biodiesel component of this bill will “die” in the Senate. Would like to see an amendment that would allow the pollution control tax credit to expire but would keep the biodiesel incentives.

 

 

 

TAPE 193, SIDE B

014

Rep. Galizio

Comments that he likes the original bill with the biodiesel component, but he does not support the extension of pollution control credit.

 

 

 

020

Chair Butler

General comments about previous testimony on the bill. Expresses concern about the stricter DEQ standards used in Oregon instead of the Environmental Protection Agency standards used by other states.

 

030

Rep. Olson

Concurs with Rep. Hass’ comments and hopes for the best when the bill is heard in the Senate.

 

 

 

 

037

Rep. Riley

Comments that “he would much rather have actual clean air than a clean air act.”

 

 

 

041

Rep. Boquist

Concurs with Rep. Olson’s comments. Comments that the most important focus of the bill is the biofuel component.

 

 

 

053

Chair Butler

Asks for roll-call vote.

 

 

 

059

Chair Butler

ORDER: THE MOTION HAVING RECEIVED THE REQUIRED MAJORITY IS DECLARED PASSED. MOTION PASSES 7-2-0. VOTING AYE: BOQUIST, ESQUIVEL, KOMP, OLSON, RILEY, BERGER, BUTLER. VOTING NO: GALIZIO, HASS. REP. HASS SERVES NOTICE OF A POSSIBLE MINORITY REPORT.

 

 

 

CLOSES WORK SESSION FOR HOUSE BILL 3481 A

 

072

Chair Butler

Adjourns meeting at 2:34 p.m.

 

 

Tape Log Submitted by:

Reviewed by:

 

 

 

Kristi Bowman, Committee Assistant

Kim Taylor James, Committee Coordinator

 

Exhibit Summary:

  • 1.      SB 996, Amendment SB 996 A-3, Leg. Counsel, 5 pp., 06/07/05
  • 2.      SB 480, Amendment SB 480 A-12, Leg. Counsel, 34 pp., 06/14/05
  • 3.      SB 896, Amendment SB 896 A-4, Leg. Counsel, 1 pg., 06/06/05
  • 4.      SB 896, Staff Measure Summary, Martin-Mahar, 1 pg., 06/13/05
  • 5.      SB 896, Revenue Impact Statement, Martin-Mahar, 1 pg., 06/13/05
  • 6.      SB 896, Amendment SB 896 A-5, Leg. Counsel, 2 pp., 06/07/05
  • 7.      SB 896, Staff Measure Summary, Martin-Mahar, 1 pg., 06/13/05
  • 8.      SB 896, Revenue Impact Statement, Martin-Mahar, 1 pg., 06/14/05
  • 9.      HB 3481, Amendment HB 3481 A-6, Leg. Counsel, 47 pp., 06/14/05
  • 10.  HB 3481, Revenue Impact Statement, Martin-Mahar, 3 pp., 06/14/05