MINUTES OF THE ASSEMBLY COMMITTEE ON TAXATION Sixty-Eighth Session June 1, 1995 The Committee on Taxation was called to order at 1:15 p.m., on Thursday, June 1, 1995, Chairman Jeannine 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. Michael A. (Mike) Schneider, 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 GUEST LEGISLATORS PRESENT: Mr. John Carpenter STAFF MEMBERS PRESENT: Mr. Ted Zuend, Deputy Fiscal Analyst OTHERS PRESENT: Carole Vilardo, President, Nevada Taxpayers Association Michael Pitlock, Executive Director, Department of Taxation OTHERS PRESENT, CONT. John Orr, DETR Bob Barengo, Amusement and Vending Machine Association Chairman Jeannine Stroth opened the meeting by requesting a formal attendance roll call from the Committee Secretary. All members on the Taxation Committee were present. Assemblyman John Carpenter (Assembly District 33), the sponsor for Assembly Bill 377, was first to testify. ASSEMBLY BILL 377 - Exempts certain charitable organizations from responsibility of paying business tax on behalf of certain persons who participate in trade show or convention. Mr. Carpenter stated A.B. 377 was introduced because of problems that ladies in Lamoille and Elko had when they put on small craft fairs (e.g., the country fairs). They were "really put out" when they had to collect the business tax. It was Mr. Carpenter's feeling it should not be the responsibility of the small, non-profit organizations to collect the business tax. He believed the lion's share of the vendors who participated in the fairs were charitable organizations, non-profit. He thought if there were people at the fairs who should be paying the business tax, the people from the Department should collect the taxes -- rather than have "the poor little ladies do it." If they had only one or two events a year, they should be exempt from the responsibility. In this day and age, we needed to keep charitable organizations alive and well. Assemblyman Joan Lambert asked Mr. Carpenter if the ladies in Lamoille actually had a 501(c)(3) exemption. And Mr. Carpenter confirmed yes, they had the exemption. Mr. Ted Zuend addressed a possible amendment (Exhibit C) and deferred to Mr. Michael Pitlock. Mr. Pitlock spoke about language in Senate Bill 144 (Section 10). In the beginning, they had looked at 501(c)(3) to see if that was a reasonable way to characterize those organizations. It did not take long before the group realized the particular categorization was way too broad for the purposes they were looking at. Therefore, they developed other guidelines to help the department deal with the definition of what a charitable organization was. Mr. Pitlock preferred the language from Section 10 of Senate Bill 144 be placed in Mr. Carpenter's bill (A.B. 377). He did not think it would affect the Lamoille Woman's Club at all. It would make for a consistent set of standards to use. Another minor change Mr. Pitlock suggested to A.B. 377 was in the notification provision (paragraph E). He wanted to see the fifteen days changed to thirty days. With those amendments, or similar ones, the department had no difficulty with A.B. 377. Ms. Lambert wondered if an organization came under the amendment and had thirty booths at a trade show in Ely, for example, what it would cost to collect the tax for those booths. Most of the events only ran for a couple of days, and Mr. Pitlock thought it would require one revenue officer going to the event for one day. That would incur travel cost and per diem. Obviously, a decision would have to be made on the part of the department as to whether or not the expense would justify the trip. If they knew in advance it was going to be only a small event, they would probably just ask for a list of the vendors that were going to be there and notify them by mail. And when the vendors received the letter, Ms. Lambert asked if they had to pay a $25.00 fee. But Mr. Pitlock said, "No, that is allocated to the event. But there was sales tax involved in many instances. The business tax was often a minor part of what the department's total involvement would be. Chairman Stroth wondered if the people who came to the functions had to pay sales tax under S.B. 144, or if they were exempt. The exemption only applied to the person actually selling the product, explained Mr. Pitlock. If a for-profit entity attended one of those events and set up a booth, they would be subject to all the taxes; there would be no exemption for them. The only exemption went to the reporting requirement in the collection function that normally falls upon the organizer of the event. Nothing in A.B. 377 relieved any of the tax burden upon a for-profit participant. "So it is your opinion that with this amendment (Exhibit C), plus changing the 15 days to 30 days, the problem being addressed would be solved?" Ms. Stroth asked Mr. Pitlock; he believed that was the case. ASSEMBLYMAN NEIGHBORS MOVED TO AMEND AND DO PASS A.B. 377. ASSEMBLYMAN SANDOVAL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** The hearing on A.B. 377 closed, and Chairman Stroth opened the hearing on Assembly Bill 490 (also Mr. Carpenter's bill). ASSEMBLY BILL 490 - Gradually reduces and prospectively repeals business tax. Mr. Carpenter offered his suggestions for A.B. 490. As introduced, the bill would phase out the business tax over a five year period. After hearing the testimony and questions raised, Mr. Carpenter felt the bill was still worth pursuing. His idea was to amend A.B. 490 with what he termed a "reverse trigger." A reverse trigger was what would happen if the funds came in over and above what the economic forum had forecasted; the business tax legislation, as presently written, would trigger in an exemption for the first five employees for all businesses. According to figures Mr. Carpenter had received from Ted Zuend, this would be an amount of about $10 million. Small business was burdened by the business tax, and Mr. Carpenter's opinion was exempting the first five employees would be a responsible move. In July of 1996, if the forecast was over $10 million, Mr. Carpenter wanted it to "kick in at that time." Ms. Lambert liked the reverse trigger. However, there was concern regarding the tax being a disincentive to employing more people. If the first five employees were exempted, when the sixth came, Ms. Lambert reasoned that suddenly the business was paying a tax on six employees. The business went from paying nothing to paying $600. But Mr. Carpenter's notion was that you would figure out the total number of employees, figure the amount of the tax ($25 per quarter per employee) and subtract the first five employees by the number of hours. That came out to approximately 2,000 hours; therefore, if the business employed six people, they would pay for only that one employee. The problem Assemblyman Pete Ernaut had with A.B. 490 was the problem he had with the business tax in general: he thought it was BAD TAX POLICY. There was no reciprocal relationship between the number of employees a business had and the amount of the money that was generated. There were a lot of one or two person law firms that generated a lot of money and there were a lot of other businesses that had 20 or 30 employees that did not. It was using the same strained logic to exempt the first five as was done to create the business tax in the first place. Mr. Ernaut would rather just go for an "all out repeal of it." If Nevada was going to have a business tax that was fair and equitable, it would have to be something you could "fight out" -- whether it was gross proceeds or net proceeds. Then it would be a fair tax. At that point, you were taxing people on some sort of a standard. "This is like trying to fix a poorly built house by putting more nails in it," illustrated Mr. Ernaut. "It was just decorating it." "We just passed a bill that would have an exemption for businesses that were in a position to employ kids who needed training," retorted Mr. Carpenter. "All employees were not in the position to do that depending upon the nature of their business. But at least exempting the first five would certainly help everyone." However, he agreed with Mr. Ernaut's opinion of there being no tax that was fair. Mr. Carpenter's opinion was we could all find issues with any tax. "Yes, but those on more solid footing as far as tax policy (is concerned) are those based on ability to pay," Mr. Ernaut contended. "With this tax, it was arbitrary." "I heartily agree with you. But I think if we exempt those first five employees, it would help those who really needed the help," reiterated Mr. Carpenter. Assemblyman Price thought the business tax was a "bummer" tax. He suggested the possibility of passing the bill, but moving the enactment dates back two years to get it on the books ("a reverse sunset" situation.) It would give true long-range planning, and put pressure on the next session of the legislature to decide if they wanted to re-enact it. Mr. Ernaut agreed, with the slight modification: he would make the effective date January 1, 1997. When the Governor was building the 1997 budget, he would understand that A.B. 490 needed to be considered. It amazed Assemblyman Larry Spitler that with all the budgetary dilemmas the Committee faced, they were just casually mentioning getting rid of a revenue source and not talking about what it would be replaced with. It was well and good to say two years down the pike you were going to tell whoever the chief executive officer of the state was you have $300 million down, but how are we going to fund education? "This is not something you just decide to do all of a sudden!" expounded Mr. Spitler. "This is something that takes planning and transition and I WILL NOT BE SUPPORTING THIS!" Mr. Price openly admitted if he had it all to do over again, he would have supported the governor's business activity tax in that year. He remembered no one who was enthusiastic about the employee tax, which was used only in a couple places, e.g., Canada used it in one of their provinces (for hospitalization "free" medical care) and Chicago also used it. But it was not a commonly used concept. The reason Mr. Carpenter had been thinking about the "reverse trigger" was, if the money was there over and above the Economic Forum's projection, the money would be there to trigger in at that time and the governor could easily figure it into his budget. An exemption of five employees would help everyone in a small business and it was a way to stay away from the budget situation Assemblyman Spitler spoke about. He admitted it would make a $10 million hole in the next budget, but if the state's economic activity increased, we could well afford it. Assemblyman Mike Schneider responded to Mr. Spitler's question regarding planning for the future. He liked the concept of "building it out four years." He disagreed with what Mr. Ernaut had said about it not being a fair tax. Mr. Schneider asserted it WAS a fair tax, because it was $25/quarter for everyone who worked and had a job regardless of anything else. He thought what Mr. Ernaut favored was taxing those who had more ability to pay, which sounded like an income tax to Mr. Schneider. Chairman Stroth illustrated Mr. Ernaut's viewpoint by using the example of a labor intensive business like a restaurant, which may employ 60 people, but did not have nearly the revenues as, say, a jewelry store that may employ only four people but was making $2 million a year. In addition, it penalized people who created jobs. To no surprise, Assemblyman Mark Manendo spoke in favor of small business. He saw firsthand how the little "Mom and Pop" operations had not hired anybody because of how the tax hit them. He believed if we really wanted to help the "little guy," maybe the people who could pay more, should, i.e., the businesses that have hundreds of employees and have the revenue to pay the tax, should continue to pay it. He felt if the Committee was really concerned about the "little guy" NOW and wanted to give them a break if the money was available in the next session, the Committee needed to address the little businesses that were really in need. Mr. Manendo exclaimed, "There is no doubt about it! The facts show the small businesses are the ones doing the major employing all over the country. We should concentrate and help the little guys: let us discuss that! But, if it is just a total shot across the board, I am really concerned about that!" If Mr. Spitler's memory served him correctly, he said this all came about because, at the time, the teacher's union and citizens had been very effective at "getting on next to an income tax (sic)" and it concerned people a great deal to get that referendum on the ballot. Every poll he had taken in his district, as well as state- wide that was taken, said that would have passed. Further, he believed this issue, while the governor came up with one proposal and other people came up with what we ended up with, Mr. Spitler had talked with business groups MUCH preferring this methodology over what would have been more onerous than the current business tax. He thought if we kept changing these things, all we were doing was begging the public to come up and say, "Look, we do not fund the basics (such as education)," and Mr. Spitler said he was not talking about frivolous kinds of funding, or flowery kinds of things. He thought the public -- on education ALONE -- would go back to do some sort of referendum to get a tax base that would increase the amount of money being paid currently. Mr. Spitler pointed out the increased demands for prisons and the fact that education was short-changed. He had no idea how we were going to handle the growth in southern Nevada. He had not had a large out-cry to get rid of the business tax. He liked the idea of the Economic Forum coming in with the number and everything over that number coming back; however, how were we going to accommodate for the growth and demands on the school systems, et. al? How were we going to pay for that if we suddenly began taking away the things that barely funded the basic needs now? Mr. Carpenter responded to Mr. Manendo, saying he agreed with him that we had "a situation in our constitution that taxes need to be fairly equal (sic)." He guessed if we tried to carve out too many things, there might be a challenge. Also, he acknowledged his understanding of what Mr. Spitler spoke about. But he thought the Economic Forum was projecting the growth to cover the needs of the state and if we had a surplus, maybe we should be giving some monies back. There were large surpluses or ending fund balances this time. In the Governor's State of the Union (speech), he "was not only to have the fund balance we always keep, but another one. That was responsible fiscal policy (sic)." Mr. Manendo informed the Committee that in 1990 a business tax had been implemented. It exempted the employers who employed 6,200 employees or more. The tax stayed in effect for two years and was not an across the board business tax. There were some people who were exempt from that tax. There had been a public outcry. People said, "Hey! Wait a minute! You pounded the little guys and let the big guys off the hook!" Last session, the tax was changed to make it across the board. "Where do you start (giving the so-called surplus money back or reducing it?) At the top end or the bottom end?" cried Mr. Manendo. "Do you start at the top end again?! What if there is only a tiny bit of money? Does one employee get exempted across the board . . . or does the little guy get pounded again, and the bigger guys get their four or five employees erased off?! Then we would be right back to the 1990 tax!" He reiterated it was the little guys he was concerned with. Mr. Manendo had "Mom and Pop" businesses in his district and they had only four or five employees at THE MOST! "They all screamed and hollered," exclaimed Mr. Manendo with great passion, "and I understand that!" Chairman Stroth announced that since Assemblyman Marvel was going to be absent, he asked the Committee not take any action. A.B. 490 would be brought up again in the future. With that, she closed the hearing. But Mr. Michael Pitlock sprang out of the audience, crying "Madam Chairman, wait! I have some details behind how the fiscal was calculated for some of the other proposals! This data might be helpful in putting this in perspective!" At that juncture, Ms. Stroth recognized Mr. Pitlock. For the record, Mr. Michael Pitlock identified himself as the Executive Director of the Department of Taxation. To put together the fiscal impact for a five employee exemption, they examined some information they had (as of September of 1994) that "brought out" the number of taxpayers by the number of employees. In the categories of five or less employees, there were 17,874 employees. That represented approximately 62 percent of the firms that paid a business tax. Those firms employed 40,655 employees. If the five employee exemption were granted, all 40,655 of those employees would be exempt. There were an additional 11,035 firms that had more than five employees. If there was an across the board exemption for the first five employees, there would be a little over 55,000 ADDITIONAL employees from firms of six or more that would also be exempt. Therefore, about $4 million dollars of the $10 million dollars would go to the 17,000 with five or less employees and then there would be another almost $6 million that would go to the larger firms. If you (the Committee) did not want to make it an across the board five employees, but only exempt with less than five, the fiscal impact would only be $4 million going to the 17,000 small firms. With that, Mr. Pitlock concluded his testimony. Mr. Manendo requested the figures in writing and the hearing on A.B. 490 closed. ASSEMBLY CONCURRENT RESOLUTION NO. 17 - Directs Department of Taxation to review and revise regulations governing collection of taxes on retail sales of food prepared for immediate consumption. Chairman Stroth referred to A.C.R. 17 as the "deli tax/vending machine" resolution. Mr. Michael Pitlock testified first. He referred to his hand-out (Exhibit D): "Proposed Regulation of the Nevada Tax Commission". This report was composed by the Department of Taxation, who had met informally with representatives from the retail industry. Those businesses had been, for the most part, fairly receptive to the regulations. But the exception was the representatives from the vending machine industry. Also contained in the packet of information provided was a copy of the notice that had been issued. The proposed regulations would be considered by the Tax Commission at their meeting on June 26. In accordance with the language in A.C.R. 17, the department scheduled three public meetings: one to be held in Las Vegas on June 7, one in Reno on June 12, and one in Elko on June 14. These meetings were to take further public comment on the regulation. In Mr. Pitlock's opinion, the department had substantially complied with all the provisions currently contained in A.C.R. 17 if it were to be adopted in its present form. The department was directed to review and revise the proposed regulations (Exhibit D) in A.C.R. 17; the hand-out was not a proposed amendment to the resolution. It was not a new issue. The department had been working on it for quite some time. The Committee was not being asked to approve the regulations. He was providing the regulations to show the department's compliance with the provisions of A.C.R. 17. Regarding the vending machine issue, Mr. Pitlock said the easiest way to sum it up was by referencing the specific legislative intent currently contained in the statute. The statute said the exemption did not pertain to any food sold from a vending machine (statute number NRS 372.284). The indication was the exemption was not intended to include sales by or from catering services or vending machines; therefore, they took exact language and put it into the regulation. During the course of the meetings they had with them, the vending machine industry basically commented they felt it was unfair for a similar product that was exempt from tax if it was sold from the grocery store was not exempt if sold from the vending machine company. The department's response to the industry was unless there was some legislative change, the department did not have the authority to go beyond what was clearly stated in the statute. Assemblyman Price laughed that his memory was quickly fading, but wished to provide some background. Only three states that had the food tax removed ever had it put back on. Removing the sales tax from food was very substantial. In round numbers, food was approximately one-third of the sales tax at that time. Mr. Price pointed out the sales tax on the water machines. Logic dictated that, if you are going to do something fairly, if a person bought a sandwich in a machine they should not have to pay more tax than if you bought it in a 7-Eleven store. Chairman Stroth wondered if candy bars at a movie theater were taxed. Mr. Pitlock replied that, with the proposed regulation, candy was exempt regardless of where it was purchased. One of the things the department had attempted to do with the proposed regulation was to make it transparent as to where the candy was being purchased. That way, there would not be inequitable situations whereby if you bought the same product one place it was taxable, but if it was purchased some other place, it was not. But Mr. Pitlock did not include vending machines because of the language in the statute. If it were not for that language, there would be a different proposed regulation to the Tax Commission. Mr. Price noted that in the Bay Area, candy was taxed. It had been a big hassle when they did that (it was a "junk food" tax). It appeared to Chairman Stroth we did not need A.C.R. 17 because the Taxation Department was already acting upon it. Although if the vending machine situation was to be corrected, there needed to be a resolution. At that point, Mr. Robert Barengo who represented the Association of Vending Machine Operators in Nevada, testified. They felt the Tax Department had done a good job; they understood their position. They requested the Tax Committee to amend A.C.R. 17 to make a new legislative intent to overturn that particular language to say that, regardless of where the item was purchased -- or the method of purchase -- it is taxed the same way. That sounded like a reasonable solution to Chairman Stroth. Assemblyman Mark Manendo agreed and wanted to make a motion. Mr. Price thought, from a procedural viewpoint, the resolution would need to go through the money committees because there would be some fiscal impact. Mr. Pitlock volunteered to provide the fiscal note to the Committee. And Mr. Barengo interjected that it would not be all of the items in the vending machines, just those particular items that fell within the regulations. Assemblyman Joan Lambert questioned what would happen if one bought a candy bar at a restaurant: would tax be paid then? "No," replied Mr. Pitlock. "If you look at the proposed regulation on Page 2, Item D, it specifically mentions baked goods or candy. We had problems with buying donuts. Depending on where you bought your donut and how many you bought could change whether or not it was taxed. Therefore, we specifically mentioned candy and baked goods as items that would be exempt." "But, if I went to Marie Callender Pies and bought blueberry pie," Ms. Lambert conjectured, "I'd paid tax." Mr. Pitlock shook his head no. "Not after the adoption of this regulation! We tried to make the regulation transparent (as) to where you bought it. That was where a lot of the public confusion came from. If I went to one place and bought this pie, I would pay taxes. If I went somewhere else, I would not. How come?! It is the same pie!" Chairman Stroth requested Mr. Ted Zuend to come up with some language to amend A.C.R. 17. He immediately agreed, saying he would talk to the bill drafter. ASSEMBLYMAN PRICE MOVED TO AMEND AND ADOPT A.C.R. 17. ASSEMBLYMAN BROWER SECONDED THE MOTION. Chairman Stroth clarified the amendment was to reflect a new legislative intent dealing with where an item was purchased. Assemblyman Larry Spitler, though, reminded the Committee that all the facts were not in. Mr. Zuend was supposed to provide the fiscal note. He questioned the wisdom of voting on the motion BEFORE all the information was available. "This has to be addressed, Mr. Spitler. Taxation is here to develop policy and it makes no sense to tax the same item in one place and not tax it in another," asserted Chairman Stroth. "I am a little confused," cried Mr. Manendo. "You go to Winchell's and buy your donuts and you get taxed; and then you go to Dunkin Donuts and do not?! I understand we need to try to put it on a level playing field, but are we saying that there are places being taxed that should not be and we are removing the tax? Or are we saying there are items that are not being taxed, that should be? Or both?!" The answer from Mr. Pitlock was, "Both." There were some situations where the regulation would cause items to be taxed that currently were not; and then there were some situations that were the reverse. "Personally, Madam Chair, I would like to see more specifics about what we are talking about before I vote on this," Mr. Manendo exclaimed. "They are right in front of you, Mr. Manendo," Ms. Stroth replied in a dry tone. Assemblyman Roy Neighbors related that now he was confused, and illustrated the following example: "I go to Marie Callender's (which is a BIG business) and I buy a pie. I do not pay any tax. But when I order a piece of pie with my dinner at the restaurant, I pay tax on the pie?!" "If you are sitting in the restaurant and buy a piece of pie with your dinner, you pay a tax on it!" confirmed Mr. Pitlock. "That is food for immediate consumption. That is the term that triggers all this! I do not mean to be so bold as to tell the Committee what they are doing, but you are NOT approving this regulation by this vote! This regulation is to be approved or not by the Tax Commission. This is NOT part of the statute; this is an administrative regulation of the department. The issue before the Committee is the resolution." Mr. Zuend believed, regardless of what the Tax Committee did, the Department of Taxation was moving ahead with the regulation. It had been an issue of concern for years. In his opinion, the issue the Taxation Committee needed to address was on the vending machines. The coke bought from a vending machine was taxable; but the same coke bought in a can from a store was not. (Also, water was considered food.) "Regarding the definition of baked goods: a donut is FRIED, not BAKED!" proclaimed Ms. Lambert. This observation drew laughter, though Ms. Lambert was serious. "A cake was baked, a pie was baked, but a DONUT WAS FRIED!" However, Mr. Pitlock interpreted baked goods to include donuts. If they were wrong in that, he conceded the regulation might need to be changed -- perhaps say "baked goods AND donuts." Ms. Stroth suggested using the term "bakery goods." Ms. Lambert further suggested that maybe the entire definition did not work. Mr. Manendo had another angle. "You go into 7-Eleven and buy a coke out of the fountain, you are not taxed. However, you buy a coke from a vending machine, it is taxed. So are we going to see a reduction in prices of vending machine cokes? Because we will be obviously be losing revenue, but are the consumers going to be benefited? Also, I would like an example of an item currently being taxed that will change to not being taxed?" Mr. Pitlock clarified Mr. Manendo's example. If you bought a coke from the fountain, it was taxed. However, a can of coke would not be. The net impact would not be significant one way or another. The baked goods was an example of how taxes would change. If you go into a donut shop and order one donut, you are taxed -- opposed to going to the grocery and buying a box of donuts . . . "Okay" interrupted Mr. Manendo with a broad grin, "now there will be no more taxes at Winchell's!" Mr. Neighbors stated he did not like donuts, (a chuckle drawing remark) and he wanted to ask a question in another area regarding sales tax; specifically, the 2 cents the state got on sales tax: what was the estimate of what it would generate? Mr. Pitlock reported for FY93-94, the 2 percent generated $357 million. He did not, however, have with him the report from the Economic Forum. But, generally, it went up at a rate of approximately 7 percent a year. Since there was no sample language on the resolution at the present time, Mr. Spitler surmised the price of a coke could theoretically decrease in the vending machine (based on the language he was hearing), while the price could increase at the 7-Eleven. If they were priced equally, we were assuming one was going to come down in price. Ms. Stroth said that was because the tax was included in the vending machine price. But Mr. Spitler argued that if the language were crafted in such a way, there could be an increase at the deli; for example, the cost of a coke. However, Mr. Pitlock said it was impossible to determine exactly what a retailer would do with his prices if there was a change in the taxing policy; he was sure there were other factors based on the location of the vending machine. There was not a consistent price for a coke out of every vending machine. There would definitely be pressures going in both directions to modify a retailer's price scheme. Ms. Stroth hoped the vending machine owners would pass some of their savings on to the consumers and not absorb the tax being paid now. Mr. Manendo agreed, because he saw that instead of the state benefiting from the revenue, the owner was. And either way, the consumer was still going to pay and Mr. Manendo would rather have our government have the money to provide for our prisons and our schools, etc. "Mr. Manendo, that is the free enterprise system: the marketplace determines the price," educated Chairman Stroth. He indicated he understood. At this point, Mr. Marvel announced his opposition and proclaimed he thought the Committee was in a dilemma because they had just put the sales tax back on food. It was, in Mr. Marvel's opinion, "the biggest mistake we ever made," and he had opposed it. (His remark drew some chortles from those present.) Chairman Stroth smiled and announced there was still a motion to amend A.C.R. 17 to reflect the sales tax -- or lack of sales tax -- to be consistent, regardless of where the item was purchased. She inquired if there were any more discussion. Seeing none, Chairman Stroth asked for a vote to amend and adopt A.C.R. 17. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** Chairman Stroth conceded she was "jumping around" and not following the agenda. She decided to discuss Assembly Bill No. 169, but was interrupted by Assemblyman Larry Spitler. Mr. Spitler announced to Chairman Stroth that an error was made in the motion on A.C.R. 17: it should have included a re-refer to Ways and Means. But Mr. Price said it would be done on the floor. However, Mr. Spitler countered that it had to be reported out of Committee to re-refer; Mr. Price agreed amend and re-refer would have been a more appropriate motion -- still, it could be done on the floor and Chairman Stroth "was sure Mr. Spitler would not let the Committee forget." However, Assemblyman Joan Lambert did not agree and made the following new motion on A.C.R. 17: ASSEMBLYMAN JOAN LAMBERT MOVED TO RESCIND THE FIRST MOTION ON A.C.R. 17 TO AMEND AND ADOPT. ASSEMBLYMAN JOHN MARVEL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** Chairman Stroth asked for another motion on A.C.R. 17. ASSEMBLYMAN BOB PRICE MOVED TO AMEND, ADOPT AND RE-REFER TO WAYS AND MEANS. ASSEMBLYMAN MAUREEN BROWER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** The hearing on A.C.R. 17 was thereby closed and the hearing on Assembly Bill 169 was opened. ASSEMBLY BILL 169 - Authorizes nonprofit organization to acquire land held in trust by county treasurer for delinquent taxes for development of affordable housing for low-income families. Chairman Stroth informed she had spoken with the county people, who had no will to proceed with the legislation. She recapped some of the history of what had transpired in the previous meetings on A.B. 169. There had been a motion of which Assemblyman Brian Sandoval had made an amendment to, then there had been an "amendment to an amendment (sic)" and, after further discussion, the Committee had rescinded all the motions. ASSEMBLYMAN MARVEL MOVED TO INDEFINITELY POSTPONE A.B. 169. ASSEMBLYMAN LAMBERT SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** Chairman Stroth announced that Assembly Bill 481 would not be discussed as was reported on the agenda; the bill would be "held onto until it was seen if it were needed or not (sic)." That left the Committee with Assemblyman Max Bennett's bill, Assembly Bill 154. Ms. Stroth had talked with Mr. Bennett before the Committee met. Mr. Bennett had spoken with Assemblyman Morse Arberry and there was some difference in Mr. Arberry's bill, which had just passed in the Education Committee. Mr. Arberry's bill addressed people between the ages of 16 and 25 who were not attending school, had not received a high school diploma, and directed them into the building trades. Mr. Bennett's bill was directed toward disadvantaged employees and that seemed to be why the fiscal note and impact were so large (it was such a large group Mr. Bennett had been trying to address in his bill that it did not seem practical). ASSEMBLYMAN MIKE SCHNEIDER MOVED TO INDEFINITELY POSTPONE A.B. 154. ASSEMBLYMAN MARVEL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** Chairman Stroth opened the hearing on Assembly Bill 173, and informed the Committee that A.B. 173 was the companion bill to Senate Bill 144. It was her understanding that S.B. 144 cleared up the confusion created on the ballot and A.B. 173 was no longer required. ASSEMBLY BILL 173 - Makes various changes regarding exemption of charitable organizations from taxes on retail sales. ASSEMBLYMAN LAMBERT MOVED TO INDEFINITELY POSTPONE A.B. 173. ASSEMBLYMAN NEIGHBORS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT. ******** Seeing no further business to be discussed during the meeting, Chairman Stroth adjourned the meeting. RESPECTFULLY SUBMITTED: Carolyn Grabski, Committee Secretary Assembly Committee on Taxation June 1, 1995 Page