Revenue & Tax - Senate

Thank you. Collis meeting of our Senate Revenue and Tax to To order jerseys a quorum and of. Senator Stubblefield. House Bill. Senator Gary Stubblefield. I would yes it is okay with committee of like for Mister Board come up. You would statement for the record please. Thank you Mr chairman Kelly Boyd chief deputy commissioner of state lands okay. Senator Stubblefield present your bill please. Thank you Mr chairman I'm gonna let Mr board president is just deals with the tax delinquent property and selling that tax delinquent property online or let. Okay to board explaining. Thank you Mr chairman committee thanks B. twelve twenty nine renames we have three types of sales that we conduct one of the first time property comes up before the public it's done physically in the county or an adjacent county where the land is located that is going to be named the tax delinquent property sale delinquent tax property sale apologists the second top occurs after that sale in occurs within a two year period between that sale and well to two years expires and that's called a post auction sale yes all property that did not sale at the physical auction physical option for that property loan sale only occur one time the third top this after two years we can conduct a negotiated sale let's say that the piece property hasn't sold and someone wants to contact us and offer a bid on that piece of property we can elect to accept that at that time property at the post option sale and if the tax delinquent sale has to occur are has to be the taxes and fees that are owed for the property at a minimum what's that two year period expires if we deem it good to get the property back on the tax rolls we can take less money for this bill changes those three taps of auction changes the name of this bill also establishes a prohibition from people outside the United States for being able to purchase property from the Commissioner state lands in the past four years we've had seventy one instances where people from Porta Rico Canada Great Britain Ireland Australia to name a few have purchased property from the state of Arkansas in the State of Arkansas from the commissioner of state lands not all of these were even Post option some of them occurred at the physical option in the county. The problem with that is we don't have any way of notifying those people let's say they quit paying their proper sales the property taxes on that property. And it goes delinquent we don't have any way of notifying them. Legally so we're going up codified we pretty much try to have a prohibition we're going to codify the prohibition so this bill this bill will state that it's illegal for someone outside who is domiciled outside the United states Alaska Hawaii included from purchasing property from which they do purchase it there and we find out about it then they forfeit that it comes back to us they forfeit the money they paid for it goes back on the road and we will sell it as tax delinquent property again. The this gives us the opportunity to create an online auction for post auction sales give us the opportunity right now we don't plan but it gives the opportunity to create an online auction for negotiated sales and those the only two types of sales that we would do online auctions specifically requires us to do the first auction the physical option in the county or in adjacent counties say they're only one or two properties we've had that happen some of our smaller counties this gives us the right to have an initiation County that was already codified we just clarifies here. And It states that we can do the post option and the negotiated sales not in the county it exemptions from that requirement That has never been a problem but the AG's office pointed out to us this year that it might be a problem in the future and that we need to clarify that so we're clarifying that with this bill. Mr. Why would you not want to have an auction in accounting I mean if Arkansas understand if you revenue option and Jason County and you only had a couple pieces of. Real estate sale Arkan understand that but if. Other than that why would you not want to have the option in the in the in the county that it represents I'm sorry Mr chairman the. The property is already been offered up for once FOR sale once in the county okay and we didn't sell at that time so we want to expand the ability to sell it be online or post auction sales okay our thank you Senator Johnson. Thank you. Mr Ford on first of all these great bill the thing about foreigners buying land and you mention their domicile if an American citizen. Was domiciled in a foreign country rossii same related to their job or whatever but they're living in Ireland waiter forever with this. Allow them to come and let's say I work for a multinational corporation I'm in Kuwait and I'm gonna retired a couple years would it keep me from being able to come over and buy tax delinquent lands in sight Senator Stubblefield district because I want to build cabin out in the woods or whatever would that stop an American citizen in that situation the language of domicile it's an excellent questions Senator Johnson the way the language is written we followed the language that the military uses for servicemen over six scoter home of record and you have to have a home of record. To purchase land from the under this bill you would have to have a home of record in the continental United States Alaska or why purchase land. Okay and then that would probably solve that that scenario that I mention one last follow up I could share of. I'm more concerned I think Senator Stubblefield as to about maybe foreign controlled corporations buying the land like this is there any mechanism to. Sort of check out a corporate buyer in and even though they might. Be a. California or Delaware corporation or whatever to make sure that they're not if they were functioning as an individual at. Using that as a as a a loophole to get around so to speak. Unfortunately not to the dept that you're seeking that's a wider more widespread problem than just the Commissioner state lands and. We feel like. By putting the pressure on. Say you're gonna lose your property and lose money paid for is about this the strongest that we can as an entity percent That covers a much broader swath of purchases than just us so we don't have a lot of corporate. We have a lot of companies about property to sell again but we don't have a lot of corporate such as the work works II that type of organization that purchase these so I'm trying not to dance around your question I think the question you're asking answers probably know. But it's something we'll certainly be happy to sit and I working with you all I think Mister Board you answered my question very very well and I'm happy with your answer thank you Mr chairman thank you Senator Stubblefield Mr thank you. Members are there other questions. Senator you want to close for your bill I'm closed. US Senator Dismang has disclosure. Would you let. Members I think I mentioned this at the last meeting will have an official letter that all submit with the Senate but I work for I will L. O. C. which is a company that buys and sells well historically may not be anymore but by the sales tax only to properties there other associated entities that have common ownership that are not received payment from those those companies but anyway just disclosure that again I'm not sure how this impacts us one way or the other but I we do buy and sell tax and billing properties. Thank you Senator Dismang Senator Johnson you have a motion. do pass. I have a motion do pass second from senator Kerr well is there any discussion on the motion. And members this does not have a revenue impact to and so we will take a vote on this one. Seeing no discussion all in favor say aye. Posebno congratulations interested through your bill has passed. Members of a Senator Dismang is cool president. Senate bill five twenty five which I am the. I'm sure but he is the co sponsor of so since this morning thank you Mr chairman I'm assuming or if you haven't gotten them yet you probably would have gotten them that there's been quite a bit Scotian especially months folks repair the franchise tax returns that the the switch over to DFA has been pretty burdensome and so in a way just wasn't ready for the etap system and that sort of thing And so this bill flips it back to the Secretary state will out of them to utilize their system and then if I remember right is an effective date that it's to transfer back and we just leave that out of this bill this point. Ninety first offered. On the first paragraph of going. Once after okay I'm sorry is going to stay with secretary of state for the. The merchant class excellent okay yes so it flew back secretary state hopefully your followers will be able to get back the more simplistic system and they may not have some of those future phone calls. Members other questions Senator Johnson. Thank you Mr chairman. Other than the phone calls Senator Dismang can you can't tell me why we need to do this or why we. Why we messed up for why we did this what we used to we did last time and the first time in theory I think it's a great idea for transfer to DFA the you know that way you've got one taxing authority that's making the collections of the problem once again it's a system difference someone could file with the secretary of state's office or franchise tax the information would also feel any could be done filing your franchise tax for single company in five minutes also if you're prepared you could batch repair again you just go in and you verify the information each one is pre filled ascential in you could have filed a hundred franchise tax reports in a matter of an hour or so my understanding and I haven't heard the myself but it in the preparation through the a tax system the sign up that's required and everything else it's a process that can go anywhere from forty five minutes plus to a couple of hours for especially folks they're not sophisticated enough for haven't navigated a tap or company that has utilized a tap in the past it's a really it's just a it's a timing issue the problem there if you're having to prepare perfect very return let's just say it's a hundred dollars an hour and it takes two hours to fill it out or to to the two hours to go through the sign up process you can very quickly get in excess of preparation cost of the actual taxes employ. Thank you for your answer follow up Mr yes Dismang you are also are here and that are the resources that are moving around to do this job accounted for in our our budget situation my understanding someone else could speak to this but I don't think you know secretary of state dropped any positions due to the transfer and I think this I got a sign and some of the roles again minus and they can come back and and do this most of it's going to be online anyway through the existing system the have I can't remember the name of it but I think it's a matter was flip the switch back on on that that online system that's in place well I always think it's great when government admits it made a mistake and moves to correct so it's a good bill thank you thank you. Are there other questions members. Of the morass of. Mr hearing please come forward it does have a. There is an impact statement with this. All. I will I will gladly Mr Collins if you will. You're recognized he's. You may want. Thank you Mr chair members of the committee Paul hearing DFA. Charlie Charlie Collins with the effect thank you Mr Collins now that you've. Rearrange your furniture. If you have which one are you going to our first. Certainly hearing Mr Mister chair we certainly we prepared a fiscal impact statement regarding Senate bill five two five course this bill is a straightforward it does provide that those taxpayers that filed with DFA during two thousand twenty one that we would be able an author and legally authorized to share all that information with the Secretary state which was an important thing to make sure that we had this in this legislation certainly also we are not anticipating any revenue impact from this change over the changeover was not scheduled to take place until may the one who made the first of course we've had people that within DFA that were reassigned to work on the franchise tax project we will certainly after this step is concluded if this bill were to become law that we would make sure that they were brought on to job duties that were no longer necessary I'm sorry that would be that we would redirect them from franchise tax duties to other areas of DFA in cap income tax or other tax actions we'd be happy to answer any questions and of course Mister Collins is also here to comment upon the work that we've done with the Secretary stayed up until this point. Mr Collins. Sure I really don't have anything to add Senator Dismang Mr hearing the questions that have happened so far really cover things but if there's anything else I'm happy to participate thank you members of the questions. And seeing no questions there are members of the secretary of state's office here and I think that they are all on board with this since we brought it to our attention but Senator Dismang you have a motion. Motion to pass tax center Johnson seconds motion any discussion on the bill seeing none all in favor say aye. Lows NO congratulations central. Okay now we have House Bill fourteen fifty seven and I think we have representive each year to taken present. Thank you Mr chairman for state representative lessees. Welcome and thank you present your bill first thank you. Miller this is a pretty simple bill to to explain but I want to give you a little background that I think you'll find is important as to why I think this bill is needed so. In the summer of two thousand eighteen there's a couple found out they were going to be parents they found out that the baby would be born in February they found out that is going to be a little girl. Things are going along pretty normally the baby was scheduled to be delivered in February February sixth so one single day before that time they discovered that this little girl's heart had stopped beating. Their worst fears came true the little girl passed away only one day before being born. The baby's mother endured an otherwise normal delivery and the baby came into this world only a few hours after she passed away. She passed away from a condition called amniotic band syndrome. She was otherwise a perfectly healthy perfectly formed beautiful little baby girl she had a chubby little cheeks she had her mother's nose but their family never had the joy of even seeing the colorized. So they all gathered around Helder Kester lover FOR a couple hours before the hospital took her away. So the next day proceeded like any other day. The parents gathered all their belongings they collected all the cards and flowers and made their way to the car they just didn't have a baby to take home at home it would look like any other day when you bring your baby home for the first time. There was a nursery full of all the little things a little girl needs. There was a rocking chair crib changing table the little mobile that sings the song that would help or go to sleep they were car seats strollers diapers wipes. Bottles and blankets and plush toys and even her name was painted on the wall but that little baby girl was not there. This parents agony didn't end there. The day that followed. Included having to make decisions on funeral arrangements where she would be laid to rest they had picked out a casket. Pay for the burial plot pay for her burial marker things This family never dreamed they'd be doing three days after having a baby. This was the most painful thing I've ever seen. That little baby girl with my granddaughter. Thank you her name was Paisley. What we learned through this tragedy was our family was not alone. There are hundreds of Arkansas families that go through this tragedy each year. They experience the same heartbreak and trauma our family did. I've heard the similar stories from parents of stillborn children. Children's names like Madeline grace and sudden Caleb and hundreds of others. My heart goes out to every single one of these families. Because I know what they've experienced. And I hope this bill will provide at least a small bit of relief for these grieving families. This bill would allow the parents of a stillborn child a one time tax credit of five hundred dollars. It applies to a stillborn child whose reach twenty weeks of gestation because twenty weeks of gestation is the medical definition of still work still birth in this country. And the whole point of the tax credit is that children are expensive. And a parent spends just as much money preparing for a child born alive as they do for a stillborn child especially when the stillbirth is near full term. And this bill serves three important purposes. Referred to the knowledges parenthood it will affirm that these parents are still parents of their stillborn child. Second my hope is that it will help or rate raise awareness of the issue of infant mortality. And third it will help parents with some of the costs they face. Because in addition to all the things I've been purchased in preparation for the arrival of the new baby these parents also face elevated medical costs because stillbirth tend to cost more. And they may also be faced with additional costs related to an autopsy or genetic testing in search of answers to their child's death. And lastly they face the funeral costs and burial costs because there is no insurance there's no life insurance rather to help cover these costs. Thankfully stillbirth is fairly rare so it's a very minimal impact on our state's tax revenue it would be around a hundred and thirty nine thousand dollars based on two hundred and seventy nine stillbirths in twenty eighteen. But this will make a big difference for these families your wallet tax credit can ease the pain caused by the death of a child it can ease the financial strain caused by this unexpected death. Parents who are struggling with grief and just trying to put one foot in front of the other shouldn't have to worry about the financial impact caused by the loss of their child. I appreciate your support this bill and I'd be happy to take any questions. Membership or other questions. Senator Johnson. Thank you Mr chairman representative these condolences for the loss of your granddaughter thank you circumstances makes it that much more tragic thank you for bringing this bill thank you Mr chairman my question is more to you under our rules for the session what would we be able to vote on the suspension the rule and pass this today or is this would that not be possible. As much as I would like to pass this bill out. We have a rule and I will be taken in. Well we should honor that route well again the. We are a whole lot of people that have to pay a whole lot of tax understanding and and we will be making decisions and certainly this bill right here with its. Very minimal cost will come to the top of the latest I respect my chairman's statement and I will not make such a motion and I hope you understand why we're doing that representive age we're we're not doing anything affects the budget until we get closer the in the session I've heard all day and I understand that I'm I wanted to make a point in the House Committee meeting my colleagues and I appreciate what they tried to do was to amend it to a thousand dollar tax credit and my thought on that was I would rather have something to help these families than to make it more than we can afford we can always have this as a starting point maybe look at it further down the road and and I also didn't want to put the Senate in that position of that amendment coming your way. Thank you thank you Mr thank you represent. Members seeing no other discussion and Mr during I think we've if you will go ahead and come forward out of we all know that the. Cost of this pathology. Like a Fisher. For. Thank you Mr chair Paul hearing D. thank yes I did if they did prepare a fiscal impact statement for house bill fourteen fifty seven the revenue impact approximately hundred thirty nine thousand dollars that's based upon CDC statistics as to the number of stillborn children in Arkansas which was approximately two hundred seventy nine in the two thousand eighteen calendar year we'd be happy to answer any questions about the fiscal impact statement members are the question Mr. Seeing thank you thank you Sir. Seeing no other business we're adjourned.