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CSHB 496(FIN) am: "An Act relating to contributions from permanent fund dividends to campuses of the University of Alaska, certain educational organizations, community foundations, and certain other charitable organizations that provide a youth development program, workforce development, aid to the arts, or aid and services to the elderly, low-income individuals, individuals in emergency situations, disabled individuals, or individuals with mental illness; and providing for an effective date."

00                      CS FOR HOUSE BILL NO. 496(FIN) am                                                                  
01 "An Act relating to contributions from permanent fund dividends to campuses of the                                      
02 University of Alaska, certain educational organizations, community foundations, and                                     
03 certain other charitable organizations that provide a youth development program,                                        
04 workforce development, aid to the arts, or aid and services to the elderly, low-income                                  
05 individuals, individuals in emergency situations, disabled individuals, or individuals                                  
06 with mental illness; and providing for an effective date."                                                              
07 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
08    * Section 1. AS 43.23 is amended by adding a new section to read:                                                  
09            Sec. 43.23.062. Contributions from dividends. (a) Notwithstanding                                        
10       AS 43.23.069, the Department of Revenue shall prepare the electronic Alaska                                       
11       permanent fund dividend application to allow an applicant who files electronically to                             
12       direct that money be subtracted from the dividend payment and contributed to one or                               
13       more of the campuses of the University of Alaska or to one or more educational                                    
01       organizations, community foundations, or charitable organizations that appear on the                              
02       contribution list contained in the application. A contribution may be $25, $50, $75, or                           
03       $100 or may be 10 percent, 25 percent, 50 percent, or 100 percent of the total dividend                           
04       amount. If the total amount of contributions elected by an applicant exceeds the                                  
05       amount of the permanent fund dividend that the applicant is entitled to receive,                                  
06       contributions shall be deducted from the dividend in the order of priority elected by                             
07       the applicant on the application until the entire amount of the dividend that the                                 
08       applicant is entitled to receive is allocated for contribution.                                                   
09            (b)  The department shall list each campus of the University of Alaska and                                   
10       shall list each educational organization, community foundation, or charitable                                     
11       organization eligible under (c) of this section on the contribution list in alphabetical                          
12       order. The department shall provide a statement of the contributions made by an                                   
13       individual that is suitable for federal income tax purposes to each individual who                                
14       elects to contribute under (a) of this section.                                                                   
15            (c)  The department may not include an educational organization on the                                       
16       contribution list unless the purpose of the organization is to provide vocational                                 
17       training or postsecondary education. Other than a community foundation, the                                       
18       department may not include a charitable organization on the contribution list for a                               
19       dividend year unless the purpose of the organization is to provide a youth development                            
20       program, workforce development, aid to the arts, or aid and services to the elderly,                              
21       low-income individuals, individuals in emergency situations, disabled individuals, or                             
22       individuals with mental illness. In addition, the educational organization, community                             
23       foundation, or charitable organization                                                                            
24                 (1)  must apply for inclusion on the contribution list for the current                                  
25       dividend year on the form required by the department before June 15 of the qualifying                             
26       year;                                                                                                             
27                 (2)  must be exempt from taxation under 26 U.S.C. 501(c)(3) (Internal                                   
28       Revenue Code) as an educational or a charitable organization on the date of                                       
29       application;                                                                                                      
30                 (3)  must have been qualified for tax exempt status under 26 U.S.C.                                     
31       501(c)(3) (Internal Revenue Code) as an educational or a charitable organization                                  
01       during the two calendar years that immediately precede the year the application is                                
02       filed;                                                                                                            
03                 (4)  must have a current Internal Revenue Service Form 990 on file                                      
04       with the United States Department of the Treasury, Internal Revenue Service;                                      
05                 (5)  must be directed by a voluntary board of directors or local advisory                               
06       board whose members are residents of the state;                                                                   
07                 (6)  during the two calendar years that immediately precede the year the                                
08       application is filed, must have provided in the state aid or services of a type listed in                         
09       this subsection, or, for a community foundation, benefits to a defined geographic area;                           
10                 (7)  must receive at least $100,000 or five percent of its total annual                                 
11       receipts, whichever is less, from contributions;                                                                  
12                 (8)  must have completed and provided to the department a financial                                     
13       audit with an unqualified opinion, conducted by an independent certified public                                   
14       accountant for the fiscal year immediately preceding the year the application is filed if                         
15       the total annual budget of the organization exceeds $250,000 during that fiscal year;                             
16       and                                                                                                               
17                 (9)  may not make grants or contributions to an organization that is                                    
18       exempt from taxation under 26 U.S.C. 501(c)(4) or (6), except that a community                                    
19       foundation may have used up to five percent of its funding for grants or contributions                            
20       to those organizations during the two consecutive years that immediately precede the                              
21       year the application is filed under (1) of this subsection.                                                       
22            (d)  The department shall use an equal percentage of the total amount                                        
23       contributed under (a) of this section to each organization for administrative costs                               
24       incurred in implementing this section. The amount remaining shall be distributed to                               
25       each organization as soon as practicable.                                                                         
26            (e)  The department may use an agent or enter into a contract under AS 36.30                                 
27       for the implementation and operation of the contribution program under this section.                              
28            (f)  A public agency that claims a dividend on behalf of an individual under                                 
29       AS 43.23.015(e) may not elect to make contributions from the dividend under (a) of                                
30       this section.                                                                                                     
31            (g)  The department may adopt regulations under AS 44.62 (Administrative                                     
01       Procedure Act) to carry out the provisions of this section. If an organization disagrees                          
02       with an action of the department under this section and requests an administrative                                
03       hearing, the hearing shall be conducted by the office of administrative hearings                                  
04       (AS 44.64.010).                                                                                                   
05            (h)  By January 20 of each year, the department shall submit a report to the                                 
06       legislature identifying the organizations on the contribution list for the immediately                            
07       preceding year, together with the amount of contributions made to each of the                                     
08       organizations.                                                                                                    
09            (i)  For purposes of this section, "community foundation" means an                                           
10       organization that is a nonprofit, autonomous, philanthropic institution operated                                  
11       primarily as a permanent collection of endowed funds for the long-term benefit of a                               
12       defined geographic area within one or more municipalities, that has a long-term goal                              
13       of increasing its permanent unrestricted charitable endowment to benefit the area                                 
14       served, that primarily provides benefits by making grants and may also provide other                              
15       forms of charitable services, that makes grants that are not limited to providing one                             
16       type of benefit or to serving one population segment, and that makes grants to multiple                           
17       grantees.                                                                                                         
18    * Sec. 2. AS 43.23.062 is repealed December 31, 2009.                                                              
19    * Sec. 3. The uncodified law of the State of Alaska is amended by adding a new section to                          
20 read:                                                                                                                   
21       APPLICABILITY. AS 43.23.062, enacted by sec. 1 of this Act, applies to the Alaska                                 
22 permanent fund dividends for 2007, 2008, and 2009.                                                                      
23    * Sec. 4. The uncodified law of the State of Alaska is amended by adding a new section to                          
24 read:                                                                                                                   
25       TEMPORARY APPLICATION PROCESS. (a) Notwithstanding AS 43.23.062(c)(1),                                            
26 as enacted in sec. 1 of this Act, on or before June 15, 2006, each organization, including a                            
27 community foundation, seeking inclusion on the contribution list for the 2007 permanent fund                            
28 dividend must submit to the Department of Revenue an affidavit signed by an officer or the                              
29 executive director of the organization attesting to the following:                                                      
30            (1)  the name, address, and telephone number of the organization;                                            
31            (2)  the name, address, and telephone number of a person designated by the                                   
01 organization whom the department may contact regarding the application;                                                 
02            (3)  that, during 2004 and 2005, the organization provided aid or services in the                            
03 state of the type described in AS 43.23.062(c), enacted in sec. 1 of this Act, or, for a                                
04 community foundation, that the foundation provided benefits to a defined geographical area;                             
05            (4)  that the funds received by the organization from 2007 permanent fund                                    
06 dividend recipients will be used for one or more of the purposes set out in AS 43.23.062(c),                            
07 enacted in sec. 1 of this Act;                                                                                          
08            (5)  the percentage of grants or contributions the organization made during                                  
09 2004 and 2005 to an organization that is exempt from taxation under 26 U.S.C. 501(c)(4) or                              
10 (6) (Internal Revenue Code);                                                                                            
11            (6)  that the organization is current in its filing of annual financial reports                              
12 required by state law;                                                                                                  
13            (7)  that the organization is directed by a voluntary board of directors or local                            
14 advisory board with members who are residents of the state;                                                             
15            (8)  that the organization maintains on file the following documents and that it                             
16 will produce the documents at its own expense on the written request of the department:                                 
17                 (A)  articles of incorporation and current bylaws;                                                      
18                 (B)  evidence of tax exemption on the date of application under 26                                      
19       U.S.C. 501(c)(3) (Internal Revenue Code);                                                                         
20                 (C)  evidence of tax exemption under 26 U.S.C. 501(c)(3) during 2004                                    
21       and 2005;                                                                                                         
22                 (D)  a current IRS Form 990 on file with the United States Department                                   
23       of the Treasury, Internal Revenue Service;                                                                        
24                 (E)  evidence that the organization received at least $100,000 or five                                  
25       percent of its total annual receipts, whichever is less, from contributions in 2005;                              
26                 (F)  evidence that, during 2004 and 2005, the organization provided aid                                 
27       or services in the state of the type described in AS 43.23.062(c), enacted in sec. 1 of                           
28       this Act, or, for a community foundation, that the foundation provided benefits to a                              
29       defined geographical area; and                                                                                    
30                 (G)  for an organization with a total annual budget that exceeded                                       
31       $250,000 during fiscal year 2005, a current financial audit conducted by an                                       
01       independent certified public accountant;                                                                          
02            (9)  that the organization will maintain all documents listed in (8) of this                                 
03 subsection until at least June 15, 2009.                                                                                
04       (b)  After June 15, 2006, the Department of Revenue shall review all affidavits for                               
05 completeness and for compliance with eligibility standards under AS 43.23.062, enacted in                               
06 sec. 1 of this Act. The department may include employees of the entity with which the                                   
07 department entered into a contract under AS 43.23.062(e), enacted in sec. 1 of this Act, to                             
08 assist in this review process. The department may request documents or information pertinent                            
09 to its review from the applicant organization. After reviewing the affidavits, the department                           
10 shall determine which applicants meet the requirements of AS 43.23.062, enacted in sec. 1 of                            
11 this Act, and (a) of this section and notify each organization of its decision in writing not later                     
12 than August 15, 2006.                                                                                                   
13       (c)  The department's written decision in (b) of this section constitutes a final agency                          
14 action.                                                                                                                 
15    * Sec. 5. This Act takes effect immediately under AS 01.10.070(c).