Legislature(1995 - 1996)
1996-01-17 Senate Journal
Full Journal pdf1996-01-17 Senate Journal Page 2149 SENATE JOURNAL ALASKA STATE LEGISLATURE NINETEENTH LEGISLATURE - SECOND SESSION Juneau, Alaska Wednesday Tenth Day Pursuant to adjournment the Senate was called to order by President Pearce at 10:56 a.m. The roll showed twelve members present. Senators Donley, Ellis, Frank, Halford, Phillips, Rieger, Sharp, Zharoff were absent. The prayer was offered by the Chaplain, Pastor Larry Olson of Eagle Wings Community Church. Senator Duncan moved and asked unanimous consent that the prayer be spread. Without objection, it was so ordered. Dear Lord, You have filled this land with untold resources. Minerals, timber, fish and wildlife. How we use those resources You have created and placed here has been the occasion for considerable squabbling among people of good will. Bless those who make decisions regarding the stewardship and use of those resources with a clear vision of just how precious Your earth is to You. We name silently now those people and those causes that are on our minds today. In Your name we ask these things. Amen. Senator Taylor led the Senate in the pledge of allegiance. The presence of Senators Donley, Ellis, Phillips, Rieger, Zharoff was noted. 2149 1996-01-17 Senate Journal Page 2150 CERTIFICATION Senator Miller moved and asked unanimous consent that the journal for the ninth legislative day be approved as certified by the Secretary. Without objection, it was so ordered. The presence of Senators Halford, Sharp, Frank was noted. COMMUNICATIONS The following report was received and is on file in the Office of the Secretary of the Senate: Alaska Commercial Fishing and Agriculture Bank, Annual Examination and Evaluation from William L. Hensley, Commissioner, Department of Commerce and Economic Development in accordance with AS 44.81.270(c) STANDING COMMITTEE REPORTS HB 224 The Labor and Commerce Committee considered CS FOR HOUSE BILL NO. 224(STA) An Act relating to the state plumbing code and recommended it be replaced with SENATE CS FOR CS FOR HOUSE BILL NO. 224(L&C) Signing do pass: Senator Kelly, Chair, Senators Miller, Torgerson, Duncan, Salo. Zero fiscal note for the Senate Committee Substitute published today from Department of Labor. The bill was referred to the Rules Committee. 1996-01-17 Senate Journal Page 2151 INTRODUCTION AND REFERENCE OF SENATE RESOLUTIONS SJR 14 SPONSOR SUBSTITUTE FOR SENATE JOINT RESOLUTION NO. 14 BY SENATORS HALFORD, Frank, Green, Kelly, Leman, Miller, Pearce, Rieger, Sharp, Taylor, Torgerson, R.Phillips, Proposing amendments to the Constitution of the State of Alaska relating to confirmation of appointments of public members who serve on a board or commission involved with managing the assets of the Alaska permanent fund. (new title) was read the first time and referred to the Judiciary and Finance Committees. INTRODUCTION AND REFERENCE OF SENATE BILLS SB 222 SENATE BILL NO. 222 BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR, entitled: An Act relating to the financing authority, programs, operations, and projects of the Alaska Industrial Development and Export Authority; providing an exemption from the procurement code for certain projects of the authority; and providing for an effective date. was read the first time and referred to the State Affairs, Transportation and Finance Committees. Zero fiscal notes published today from Department of Commerce and Economic Development, Department of Administration. Governors transmittal letter dated January 16: 1996-01-17 Senate Journal Page 2152 SB 222 Dear President Pearce: Under the authority of art. III, sec. 18, of the Alaska Constitution, I am transmitting a bill to boost Alaskas economy and create jobs in the state by strengthening the bonding authority of the Alaska Industrial Development and Export Authority (AIDEA). The bill also modifies AIDEAs business assistance program to make it more effective in light of the recent changes to the federal Small Business Administration loan guarantee program. In addition, the bill includes required bonding authority for several major development projects. The first basic component of the bill (sec. 2) restores AIDEAs bonding authority for development projects of $10,000,000 or less. AIDEAs general bonding authority expired June 30 and has severely restricted AIDEAs ability to assist not only in key development projects but also in conduit revenue financing transactions that do not involve the credit of AIDEA or the state. The second component of the bill makes needed changes to AIDEAs business assistance program (primarily secs. 5 through 12) and repeals the existing July 1, 1996 sunset provision for the program (sec. 17(2)). Recent changes in the federal small business administration program have left a financing void for Alaska small businesses. The bill will make changes in AIDEAs business assistance loan guarantee program allowing AIDEA, in conjunction with the states private financial institutions, to create additional financing opportunities for state businesses. The third component of the bill provides legislative authority for two important projects that exceed the $10 million dollar statutory threshold. Although there are legal questions as to whether this approval of bonds infringes on executive powers, I believe the legislature needs to participate in AIDEAs development agenda. This bill would authorize AIDEA to issue up to $60,000,000 in revenue bonds for expansion, improvement, and modification of AIDEAs existing port and transportation facilities serving the Red Dog Mine (sec. 18). Repayment of the bonds would be the obligation of mine developer Cominco, Ltd. The Red Dog already provides more than 350 jobs, 15 percent of the jobs in the Northwest 1996-01-17 Senate Journal Page 2153 SB 222 Arctic Borough. The expansion project will provide up to 70 more jobs and allow the mine to continue to be a major source of employment in the region for the next 50 years. The bill also provides a limited procurement exemption for contracts entered into by AIDEA related to the Red Dog Mine expansion and other similarly situated AIDEA projects (sec. 1). The second project this bill authorizes is AIDEAs acquisition of the Snettisham hydroelectric project (sec. 19). Congress recently authorized the Alaska Power Administrations sale of Snettisham to the state. This bill authorizes the issuance of up to $100,000,000 of AIDEA bonds to finance the acquisition. Repayment would be the responsibility of Alaska Electric Light and Power under a take-or- pay long-term power sales contract. Snettisham is a 78 megawatt facility that is expected to provide long-term rate stability for customers in Juneau and Douglas. Finally, the bill makes technical modifications to AIDEAs statutes (secs. 3, 4, 5, 6, 14, 15, 16, and 17(1)) and repeals previously granted bonding authority for fueling facilities at the Anchorage International Airport and the Midrex facility proposed for Point MacKenzie. AIDEA will not be required to issue bonds for either of these projects. In a time of dwindling state resources it is fortunate that we have a financially healthy agency like AIDEA to forge public-private partnerships that can strengthen the states economic base. This bill will enhance the tools available to AIDEA to further this mission. I urge your passage of this bill. Sincerely, /s/ Tony Knowles Governor 1996-01-17 Senate Journal Page 2154 SB 223 SENATE BILL NO. 223 BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR, entitled: An Act approving an interim classification by the commissioner of natural resources closing certain land within the Situk River system to new mineral entry; and providing for an effective date. was read the first time and referred to the Resources, State Affairs, Community and Regional Affairs and Judiciary Committees. Zero fiscal notes published today from Department of Fish and Game, Department of Natural Resources. Governors transmittal letter dated January 16: Dear President Pearce: Under the authority of art. III, sec. 18, of the Alaska Constitution, I am transmitting a bill relating to the permanent closure of certain land within the Situk River system to new mineral entry. The closure was called for in the Yakataga Area Plan adopted in April, 1995. The permanent closure is sought due to the importance of the Situk River system in supporting commercial, sport, subsistence, and personal use fisheries. A permanent closure of an area of state land exceeding 640 contiguous acres to new mineral entry requires legislative approval. This bill would provide legislative approval of an interim classification order by the commissioner of natural resources. The state Department of Fish and Game has worked closely with Yakutat area businesses and fishers in developing the Situk management plan. The closure to new mineral entry has gathered broad local support from users of this world-class fishery. 1996-01-17 Senate Journal Page 2155 SB 223 Because the interim classification closing the system to new mineral entry will expire on the 90th day of the legislative session unless approved by the legislature, I urge your early and favorable consideration of this bill. Sincerely, /s/ Tony Knowles Governor SB 224 SENATE BILL NO. 224 BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR, entitled: An Act establishing the office of tax appeals in the Department of Administration; revising the procedures for formal hearing of certain tax appeals, including appeals regarding seafood marketing assessments; providing for the release of agency records relating to formal administrative tax appeals; relating to litigation disclosure of public records; clarifying administrative subpoena power in certain tax matters; and providing for an effective date. was read the first time and referred to the Resources, Judiciary and Finance Committees. Fiscal notes published today from Department of Revenue, Department of Administration. Zero fiscal note published today from Department of Law. Governors transmittal letter dated January 16: Dear President Pearce: Under the authority of art. III, sec. 18, of the Alaska Constitution, I am transmitting a bill relating to certain tax appeal procedures. This bill addresses the concerns of fairness and improves the efficiency and openness of certain administrative tax appeals presently assigned to the Department of Revenue. 1996-01-17 Senate Journal Page 2156 SB 224 The bill has four main components: transfer of the function of hearing certain tax appeals (including appeals regarding seafood marketing assessments) from the Department of Revenue (DOR) to a newly-created office of tax appeals in the Department of Administration; revision of the tax appeal procedures to encourage earlier exchange of information and resolution of tax disputes; opening administrative tax appeals to public examination and scrutiny; and clarification of the ability of the DOR to obtain information regarding tax matters. Transferring the function of hearing administrative tax appeals to the Department of Administration will address a perception held by certain taxpayers that the current system is unfair because the tax audit and appeal function are both in the DOR. Courts have consistently found that combining the functions of auditing taxes and hearing tax appeals in the same department is fair. Nevertheless, I have decided to recommend the transfer to remedy the perception of unfairness. Transfer from the DOR will have the additional advantage of removing a difficulty the commissioner of revenue often faces. As the ultimate decision maker in an appeal, the commissioner of revenue must distance himself or herself from the auditing division when the matter reaches the formal hearing stage. Transferring these hearing functions from the DOR resolves this issue. Under the proposed bill, the commissioner of revenue may be involved with the auditing division throughout the appeal process. This will foster resolution of tax appeals more quickly and efficiently. The second component of the bill is a revision of the revenue tax procedures to encourage earlier exchange of information and to lessen the burden of discovery during the formal appeal phase. The bill also requires that administrative law judges supervising tax appeals limit discovery to relevant information and permits further limitation of discovery in order to promote efficient, just, and speedy resolution of appeals. The purpose is to prevent revenue tax appeals from becoming wars of attrition with huge volumes of documents being requested and produced. The bill would induce both parties to a tax dispute to focus on the bona fide issues at hand. 1996-01-17 Senate Journal Page 2157 SB 224 A third feature of the bill is that the formal tax appeal proceedings, records, and decisions would be open to the public. Under current law, a tax matter becomes public only when it is appealed to the superior court. Tax appeals often are of great public interest and public scrutiny will help the process. The fourth component of the bill is a clarification of the DORs subpoena power during the audit stage. Under current law, the DOR has the power to compel production of records and testimony necessary to complete an audit, but in practice the DOR has almost always relied upon voluntary release of information by taxpayers and depended upon the discovery process of the formal hearing to obtain information that a taxpayer has refused or failed to release. The current system has no express procedure for judicial enforcement of tax audit subpoenas. Many times in the past, a taxpayers position has been initially rejected due to the taxpayers failure to provide substantiating information. Then, during the appeal, the taxpayer released the relevant information and made the issue moot. This practice has unnecessarily complicated and delayed tax disputes. The bill provides a streamlined process for court enforcement of subpoenas issued during the audit stage and clarifies the current ambiguity in AS 43.55.040 as to whether the DOR is vested with investigatory powers to the full extent of the law in order to perform the audit function. The DOR, in consultation with the Department of Law, has prepared a section-by-section analysis that is available to explain the detailed features of the bill. This bill is designed to help break the chain of antagonistic tax disputes that have characterized our states recent history. Disputes will not end, of course, but if this bill becomes law, they will be resolved more quickly and efficiently to the advantage of taxpayers and the public alike. I urge your support of this bill. Sincerely, /s/ Tony Knowles Governor 1996-01-17 Senate Journal Page 2158 CONSIDERATION OF THE CALENDAR CITATIONS Honoring - Eileen MacLean Representative(s) Foster Senator(s) Adams, Pearce, Leman, Zharoff, Duncan, Halford, Lincoln, Salo, Hoffman, Rieger, Taylor, Green, Frank Honoring - Rose Palmquist Representative(s) Kohring, Masek, Ogan Senator(s) Green, Halford, R. Phillips, Pearce, Leman, Zharoff, Duncan, Lincoln, Salo, Adams, Ellis, Hoffman, Rieger, Donley, Taylor, Frank Senator Halford moved and asked unanimous consent that the citations be adopted. Without objection, the citations were adopted and referred to the Secretary for transmittal. UNFINISHED BUSINESS Senator Zharoff moved and asked unanimous consent that he be excused from the Senate, not subject to a call, on January 19. Without objection, Senator Zharoff was excused. Senator Salo moved and asked unanimous consent that she be excused from a call of the Senate on January 26. Without objection, Senator Salo was excused. Senator Rieger moved and asked unanimous consent that he be excused from a call of the Senate on January 22, through morning plane time. Without objection, Senator Rieger was excused. Senator Lincoln moved and asked unanimous consent that she be excused from a call of the Senate on January 26. Without objection, Senator Lincoln was excused. ANNOUNCEMENTS Announcements are at the end of the journal. 1996-01-17 Senate Journal Page 2159 RECESS Senator Halford moved and asked unanimous consent that the Senate stand in recess to the Joint Session. Without objection, the Senate recessed at 11:10 a.m. AFTER RECESS JOINT SESSION IN THE HOUSE Speaker Phillips called the House to order and in accordance with Uniform Rule 51 turned the gavel over to President Pearce at 11:48 a.m. The purpose of the Joint Session was to hear an address by the Honorable Frank Murkowski, United States Senator. President Pearce introduced Nancy Murkowski, wife of Senator Frank Murkowski. Senator Halford moved and asked unanimous consent that the roll call of the Senate be waived and all members be shown as present. Without objection, it was so ordered. Representative Vezey moved and asked unanimous consent that the roll call of the House be waived and all members be shown as present. Without objection, it was so ordered. President Pearce appointed Representative Martin and Senator Sharp to escort United States Senator Frank Murkowski to the Joint Session. The Senate Sergeant at Arms, Will Arthur, announced Senator Murkowskis entrance to the House Chamber. The Honorable Frank Murkowski was escorted to the rostrum and introduced by President Pearce. United States Senator Frank Murkowski delivered his address. This address appears in House and Senate Joint Journal Supplement No. 16. 1996-01-17 Senate Journal Page 2160 Following his address, there was a question and answer period. United States Senator Frank Murkowski received a standing ovation and was escorted from the chamber by Senator Sharp and Representative Martin. Senator Halford moved and asked unanimous consent that the Joint Session stand in adjournment. Without objection, President Pearce adjourned the Joint Session at 12:40 p.m. AFTER RECESS IN THE SENATE The Senate reconvened at 12:41 p.m. ADJOURNMENT Senator Phillips moved and asked unanimous consent that the Senate stand in adjournment until 11:00 a.m., January 18, 1996. Without objection, the Senate adjourned at 12:42 p.m. Nancy Quinto Secretary of the Senate January 1996 1996-01-17 Senate Journal Page 2161 ANNOUNCEMENTS NOTICE - AMERICANS WITH DISABILITIES ACT Persons with disabilities who require special accommodation or alternative communication formats to access committee meetings may contact the appropriate committee office or the Legislative Information Office in their community. Reasonable advance notice is needed to accommodate the request. For further information, call the ADA Coordinator at 465-3854 Voice/465-4980 TDD. + indicates teleconference STANDING COMMITTEES COMMUNITY & REGIONAL AFFAIRS BUTROVICH ROOM 205 JAN 17 WEDNESDAY 1:30 PM NO MEETING SCHEDULED JAN 19 FRIDAY 1:30 PM NO MEETING SCHEDULED ---------------------------------------- FINANCE SENATE FINANCE 532 JAN 17 WEDNESDAY 9:00 AM FY 97 STATEWIDE BUDGET OVERVIEW; ..ANALEE MCCONNELL, OFFICE OF MANAGEMENT AND BUDGET DIRECTOR JAN 18 THURSDAY 9:00 AM FY 97 DEPARTMENT BUDGET OVERVIEWS ..COMMISSIONER MIKE IRWIN, DEPT. OF COMMUNITY AND REGIONAL AFFAIRS ..DEPUTY COMMISSIONER MICHELE BROWN, DEPT. OF ENVIRONMENTAL CONSERVATION + ..ART SNOWDEN, COURT SYSTEM ADMINISTRATOR JAN 19 FRIDAY 9:00 AM FY 97 DEPARTMENT BUDGET OVERVIEWS ..COMMISSIONER WILLIE HENSLEY, DEPT. OF COMMERCE AND ECONOMIC DEVELOPMENT ..COMMISSIONER TOM CASHEN, DEPT. OF LABOR ..COMMISSIONER KAREN PERDUE, DEPT. OF HEALTH AND SOCIAL SERVICES ---------------------------------------- 1996-01-17 Senate Journal Page 2162 HEALTH, EDUCATION & SOCIAL SERVICES BUTROVICH ROOM 205 JAN 17 WEDNESDAY 9:00 AM + SB 165 PSYCHOLOGISTS & PSYCHOLOGICAL ASSOCIATES + SB 212 DISCIPLINARY SANCTIONS FOR DENTISTS JAN 18 THURSDAY 3:00 PM JOINT HOUSE AND SENATE HESS COMMITTEE MEETING OVERVIEW OF MENTAL HEALTH PROGRAM AND PLANNING EO 97 TRANSFER FUNCTIONS OF THE ALASKA COMM. ON POSTSECONDARY EDUCATION JAN 19 FRIDAY 9:00 AM NO MEETING SCHEDULED ---------------------------------------- JUDICIARY BELTZ ROOM 211 JAN 17 WEDNESDAY 1:30 PM + SB 194 GANG RELATED CRIMES JAN 19 FRIDAY 1:30 PM HJR 30 AMEND US CONSTIT. TO LIMIT FED. COURTS ---------------------------------------- LABOR & COMMERCE FAHRENKAMP RM 203 JAN 18 THURSDAY 1:30 PM SB 202 ARCHITECTS/ENGINEERS/LAND SURVEYORS ---------------------------------------- RESOURCES BUTROVICH ROOM 205 JAN 17 WEDNESDAY 3:30 PM + SB 162 AGRICULTURAL LAND SB 128 NONRESIDENT HUNT, SPORT FISH, TRAP FEES JAN 19 FRIDAY 3:30 PM HB 191 MANAGEMENT OF STATE LAND AND RESOURCES ---------------------------------------- STATE AFFAIRS BELTZ ROOM 211 JAN 18 THURSDAY 3:30 PM NO MEETING SCHEDULED ---------------------------------------- 1996-01-17 Senate Journal Page 2163 TRANSPORTATION BUTROVICH ROOM 205 JAN 18 THURSDAY 1:30 PM NO MEETING SCHEDULED JOINT COMMITTEES LEGISLATIVE BUDGET & AUDIT HOUSE FINANCE 519 FEB 07 WEDNESDAY 4:30 PM JOINT WITH HOUSE/SENATE FINANCE SUBCOMMITTEES ON REVENUE ..PERMANENT FUND DIVIDEND CORPORATION OVERVIEW WITH BOARD OF TRUSTEES ..WORK-SESSION COMPARING INVESTMENT STRATEGIES OF THE STATES 3 RETIREMENT FUNDS AND THE PERMANENT FUND OTHER MEETINGS CHILDRENS CAUCUS BUTROVICH RM 205 JAN 23 TUESDAY 12:00 PM UPDATE ON THE HEALTHY FAMILIES PROGRAM BY DEPARTMENT OF HEALTH AND SOCIAL SERVICES DEPUTY COMMISSIONER YVONNE CHASE ---------------------------------------- JOINT TASK FORCE ON INTERNATIONAL TRADE HOUSE FINANCE 519 JAN 18 THURSDAY 4:00 PM ALASKAS INTERNATIONAL TRADE SUPPORT NETWORK ----------------------------------------