MINUTES OF THE ASSEMBLY COMMITTEE ON TAXATION Sixty-eighth Session April 25, 1995 The Committee on Taxation was called to order at 1:15 p.m., on Tuesday, April 25, 1995, Chairman Stroth presiding in Room 332 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Bob Price, Chairman Ms. Jeannine Stroth, Chairman Mr. Pete Ernaut, Vice Chairman Mr. Morse Arberry, Jr. Mrs. Maureen E. Brower Mrs. Joan A. Lambert Mr. Mark Manendo Mr. John W. Marvel Mr. P.M. Roy Neighbors Mr. Brian Sandoval Mr. Larry L. Spitler COMMITTEE MEMBERS ABSENT/EXCUSED: Mr. Michael A. (Mike) Schneider, Vice Chairman GUEST LEGISLATORS PRESENT: Senator Kathy Augustine, Senate District #7 STAFF MEMBERS PRESENT: Ted Zuend, Deputy Fiscal Analyst OTHERS PRESENT: Ms. V. Brett Mulligan, representing Congresswoman Vucanovich James Sarintino S. J. R. 15 - Urges Congress to pass legislation prohibiting states from imposing tax on income from pensions of nonresidents. Chairman Stroth introduced Senator Augustine and asked her to proceed with her testimony on SJR 15. Senator Augustine briefed the committee on the reason for this measure explaining it was the result of two bills currently under consideration in Washington, D.C., HR 394 and S 44. She reminded the members who served with her in the Assembly last session they passed an almost identical resolution but it was not passed by Congress. Included as part of the record is Senator Augustine's written testimony attached as Exhibit C. There being no questions proposed to the Senator, she thanked the committee for hearing this bill. She then introduced a representative from the office of Congresswoman Vucanovich and turned the floor over to her. Testifying next in support of the resolution was Ms. V. Brett Mulligan, District Director for Congresswoman Vucanovich. She submitted, and read for the record, a letter from the Congresswoman, addressed to Senator Augustine, outlining her position on the source tax legislation. Attached as Exhibit D. Included in the Exhibit is a copy of H.R. 394 currently under consideration in Washington, D.C. Submitted for distribution to the committee members was a statement from United States Senator Harry Reid, with an accompanying copy of the proposed Senate Bill 44 currently under consideration in Washington. (Exhibit E) Copies of a statement from Ted Zuend, Deputy Fiscal Analyst, giving a brief explanation of the bill (Exhibit F) have been made available to the committee. Testifying next in support of the bill was Mr. James Sarintino a resident of Gardnerville who stated he retired to Nevada five years ago from Los Angeles County. He receives a retirement income from that employment and during the past five years he has been forced to pay taxes to California in a substantial amount. He feels this is entirely unfair and wants to express his thanks to Congresswoman Vucanovich and Senator Reid for the strong efforts they put forward to eliminate this unfair taxation. He pointed out there was an anomaly in the California taxation code that a lien cannot be placed against a retiree who draws a retirement pension and resides in California. However, a non-resident is specifically exempt from that lien. Therefore, any retiree who is not a resident can be subject to a lien being placed against his retirement income and if he refuses to pay the taxes that lien continues to build with penalties to an ungodly amount. He strongly urges the committee to adopt this resolution and continue to support our congressional delegates to pass the two bills currently under consideration. There being no further testimony the hearing was closed. UPON MOTION BY MR. MARVEL, SECONDED BY MR. MANENDO S.J.R 15 WAS GIVEN A `DO PASS'. MOTION CARRIED UNANIMOUSLY. The Committee took up the following bills as a work session: ASSEMBLY BILL 170 - AUTHORIZES TAX FOR PARKS IN EXISTING RESIDENTIAL COMMUNITIES Chairman Stroth asked for a report from the sub-committee on A.B.170. Mr. Neighbors responded they did have a subcommittee meeting and had one person attend. At the conclusion of the meeting, it was the consensus of the members to recommend "Indefinitely Postpone" to the full committee; that recommendation was put forth by motion duly made and seconded, carrying unanimously. MR. ERNAUT INTRODUCED A MOTION TO ACCEPT THE RECOMMEN- DATION OF THE SUBCOMMITTEE AND INDEFINITELY POSTPONE A.B. 170, SECONDED BY MR.MANENDO AND CARRIED UNANIMOUSLY. ASSEMBLY BILL 90 - INCREASES EXCISE TAXES ON LIQUOR TO PROVIDE TREATMENT FOR ALCOHOL AND DRUG ABUSERS WHO HAVE BEEN ACCUSED OR CONVICTED OF CRIMES. A.B. 90 INDEFINITELY POSTPONED UPON MOTION BY MR. ERNAUT SECONDED BY MR. NEIGHBORS AND CARRIED UNANIMOUSLY. By way of explanation, Chairman Stroth explained the committee members, after the full hearing on this measure, were very supportive of the programs and recognize the benefits to be derived from the treatment centers, but there was some question as to whether this was the best avenue of raising money. Mr. Neighbors concurred and suggested this may be something that could be funded out of the General Fund. Mr. Price agreed the programs and help for people is desperately needed but he agrees this tax is not the way to go. ASSEMBLY BILL 373 - PROPOSES TO EXEMPT FROM TAXES ON RETAIL SALES ORTHOTIC APPLIANCES AND AMBULATORY CASTS, OTHER SUPPORTS AND CASTS IF PRESCRIBED OR APPLIED BY LICENSED PHYSICIAN, AND SPLINTS, BANDAGES, PADS, COMPRESSES AND DRESSINGS PRESCRIBED, FURNISHED OR SOLD UNDER CERTAIN CIRCUMSTANCES. A. B. 373 WAS VOTED OUT OF COMMITTEE WITH AN "AMEND AND DO PA PASS" VOTE. MOTION MADE BY MR. ERNAUT AND SECONDED BY MRS. LAMBERT. MOTION CARRIED WITH MR. MARVEL ABSTAINING. Prior to the vote being taken, Mr. Spitler noted the fiscal note on this measure concerned the committee members at the time of the full hearing and there was testimony that the fiscal note was incorrect. He asked if there was a more specific number that could give us a clearer picture on the fiscal impact. Mr. Sandoval responded to Mr. Spitler's question pointing out several of the proponents of the bill did some independent research on what they felt would be a more realistic fiscal impact and rather than the $2-million dollars for six months, which is extrapolated out to $4-million dollars per year, their estimate was between $400,000 to $600,000 per year. Mr. Marvel suggested this bill be rereferred to Committee on Ways and Means as it does have a fiscal impact and, for that reason, he felt more comfortable abstaining from the vote. Those present agreed the bill will be rereferred to Ways and Means. Chairman Stroth asked the members if they were ready to proceed with Mr. Carpenter's bill A.B. 377. Mr. Marvel interjected he received a letter from the Department of Taxation and the point they were trying to make is for "outside vendors". It is not organizations like the Lamoille Womens Club the Department is trying to penalize, it is people coming from out of state who have their wares to sell. This has come about from quite a few complaints from the downtown business people in Elko. That did not come out in the previous testimony during the hearing on this bill. It was concluded by those present to hold action on A.B. 377 until Mr. Carpenter can be available. Mr. Price proffered a request for Committee introduction of a bill which is the result of ACR 47 of last session. Summary: "Repeals certain provisions governing suppliers of certain intoxicating liquor who are required to hold certificate of compliance". (BDR 32-509). A motion was made to introduce the bill by Mr. Ernaut, seconded by Mrs. Lambert and carried unanimously. There being no further business, the meeting was adjourned at 2:30 p.m. RESPECTFULLY SUBMITTED: Nykki Kinsley, Committee Secretary APPROVED BY: ________________________________ Assemblyman Bob Price, Chairman ______________________________________ Assemblyman Jeannine Stroth, Chairman Assembly Committee on Taxation April 25, l995 Page