State Rep. Sam Kito III wants to close a $200,000 funding gap at the Alaska Public Offices Commission, or APOC, which oversees the activities of candidates, political groups and lobbyists.
His solution: a selective income tax on lobbyists. The revenue, he says, would help with accurate and timely oversight of lobbying activities.
“Over the recent couple of years we’ve actually, because of budget cuts, lost two lobbying staff people in Juneau … So this would be trying to bring some support back,” he explained in a recent interview.
In 2016, the state increased the amount that APOC can collect through fees to make up for budget cuts. The problem is that APOC doesn’t have the legal authority — called a receipt authority — to raise the amounts they collect to meet the new limit.
Kito wants to replace the $250 registration fee that lobbyists currently pay per contract with a 2.5 percent income tax on lobbyists. The tax would allow APOC to meet its receipt authority and provide some extra revenue for hiring staff.
In a hearing on Feb. 14, Heather Hebdon who directs APOC, said the tax would apply to approximately 132 registered lobbyists in the state.
The bill is stuck in the House State Affairs Committee.
Rep. Chris Birch, who sits on the committee, made it clear that he is not comfortable levying a tax on a specific profession.
“I would be much more comfortable to retain some sort of a flat rate,” he said. “I think that’s a much more manageable approach than instituting an income tax on the lobbyists … It’s certainly more consistent with what I would see as fair and equitable.”
Kito, a former lobbyist himself, admits that Alaska’s constitution, which prohibits earmarking tax revenue for specific purposes, presents a problem for the bill in its current form.
“There is not a way to clearly identify that the lobbyist tax revenue will directly benefit the Alaska Public Offices Commission,” he admitted in a Feb. 14 hearing.
Kito said he’s open to changes to the bill that would ensure more funding for APOC.
The bill has not been scheduled for another hearing, but there is a committee substitute in the works.