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In addition,
members from the public in attendance were Mr. Sung Do Kang, President
of the Korean/American Drycleaners Association (KADA) and Mr.
Peter Marberry.
Mr. Polak
stated that the purpose of this telephonic meeting is to review
and act on the revised license fee MATRIX developed by the Administrator,
based on the criteria passed by the Council at their September
30, 2003 Council meeting. The Council passed a motion increasing
the license fees per the MATRIX they originally approved on July
24, 2003 with the modifications to cap the license fee at $4,500
and where possible, limit the increase in the license fee for
any current licensee to no more than a tripling.
Mr. Kim inquired
if this meeting was a public meeting and Mr. McCarthy responded
that yes it is.
Mr. Eriksen
reviewed with the Council the proposed licensing fee MATRIX, noting
that his review indicated there are nine (9) drycleaners using
perc who, if they used the same amount of solvent in 2003 as they
did in 2002, may see an increase in their license fee by more
than triple. He did additional research to try and quantify how
many petroleum drycleaners would be classified as "petroleum with
reclaimer" and thus be subject to more than a tripling of their
current license fee. His research indicated that out of 60 petroleum
drycleaners, only 3 were identified as having more than a tripling
and in each of those cases, their license fee would go from $1,000
to $4,500 per year.
Mr. Kim stated
that he had a recommendation that instead of capping the license
fee at $4,500 that the fee categories go up by $250 increments
rather than $500. Mr. Polak responded that the intent of this
meeting was to review and vote on the proposed licensing fee MATRIX,
which is the final product from what the Council approved on September
30, 2003. If the MATRIX wasn't approved, the Council could consider
some other alternative.
After review
and discussion by the Council, on a motion by Mr. Lewicki and
a second by Mr. Gibson, the following was the roll vote regarding
the new proposed licensing MATRIX:
Mr. Chung Yes
Dr. Chweh No
Mr. Gibson Yes
Mr. Kim No
Mr. Lewicki Yes
Mr. Polak Yes
The new licensing
MATRIX passed by a vote of 4-2.
Mr. Peter
Marberry asked if he could address the Council with several questions
regarding the licensing fee. Mr. Polak agreed to let Mr. Marberry
comment. Mr. Marberry's first question is "Why does the license
fee have variability?" He believes that the license fee should
be a right of entry into the industry and should be the same for
all drycleaners. In addition, did an actuary look at the licensing
fees? Mr. Polak pointed out that the original legislation introduced
the variability into the license fee schedule and all the Council
had done was to attempt to maintain a certain degree of equity
into the process of distributing the costs. He further stated
that no, it was not necessary to have an actuary look at these
fees, as the license fee and solvent taxes are revenues being
used to generate money for the remedial account, not the insurance
account, which has had an actuarial analysis.
Mr. Marberry
asked if Mr. Eriksen had provided to the Council, all of their
graphs and letters that he had submitted during the public comment
period, and if so, did they have any questions? The Council members
responded that they had received the information and had no questions.
Mr. Marberry stated that it was his opinion that he thought the
legislation would be revenue neutral. Mr. Polak stated that the
new licensing categories as established in SB1000 were revenue
neutral but that the Council had to make adjustments to cover
the cost of the additional benefits per the new legislation plus
cover the shortfall that previously existed. Mr. Polak noted that
the Council would be reviewing the solvent taxes and license fees
annually and could adjust them accordingly.
Mr. Marberry
inquired of Mr. Eriksen of what the appeal procedure was as it
pertains to the Council's decision on increasing the license fees
and solvent taxes. Mr. Eriksen stated that he did not know, as
this has been the first time that the Council has approved an
increase in the solvent taxes and license fees. He commented he
would need to review the issue with legal counsel and provide
Mr. Marberry an answer at a future date.
Mr. Sung Do
Kang, President of KADA, stated that if the license fee is capped
at $4,500, that runs contrary to KADA's legislative request of
creating 13 different categories as part of SB1000 because they
wanted to create a cost differential based upon economic diversity.
Mr. Polak noted that the Council determined to cap the license
fee at $4,500, based upon public comment received during the public
hearing.
Mr. Marberry
inquired as to the date SB1000 went into effect. Mr. Eriksen noted
that the Governor signed the bill on July 14, 2003, but it goes
into effect January 1, 2004.
On a motion
by Mr. Lewicki and a second by Dr. Chweh, by a vote of 6-0, the
Council adjourned their telephonic meeting at 4:37 p.m.
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