1997-03-12                     House Journal                      Page 0638
HB 187                                                                       
HOUSE BILL NO. 187 by the House Rules Committee by request of                  
the Governor, entitled:                                                        
                                                                               
An Act relating to a small business development tax credit under              
the Alaska Net Income Tax Act; and providing for an effective                  
date.                                                                          
                                                                               
was read the first time and referred to the Labor & Commerce, State            
Affairs and Finance Committees.                                                
                                                                               
The following fiscal note applies:                                             
                                                                               
Fiscal note, Dept. of Revenue, 3/12/97                                         

1997-03-12                     House Journal                      Page 0639
HB 187                                                                       
The Governor's transmittal letter, dated March 11, 1997, appears               
below:                                                                         
                                                                               
Dear Speaker Phillips:                                                         
                                                                               
The vast majority of Alaskas businesses can be defined as small but            
they play an enormous role in our states economy by providing more             
than 70 percent of private sector jobs and being the largest employers         
of minorities, women and youth.  Any effort to give a boost to                 
business in Alaska must consider small businesses.                             
                                                                               
This bill, which is part of my Alaska Business Investment Incentive            
Plan, will encourage growth in small businesses by offering them tax           
credits for improving and expanding their operations.  The intent is to        
help level the competitive playing field between small businesses and          
larger corporations which enjoy economies of scale and management,             
and ready access to investment capital at favorable interest rates.            
Through this program, the state can assist small businesses in covering        
start-up costs, the purchase of new equipment, and the expansion of            
facilities--leading to jobs for Alaskans.                                      
                                                                               
The Small Business Investment Tax Credit will benefit non-affiliated           
corporations, those with no brothers, sisters, parents or subsidiaries,        
with fewer than 50 employees.  The tax credit will be 10% of capital           
investment up to $100,000, with a maximum annual credit of $10,000             
and 50% of the businesss corporate income tax liability.  To qualify,          
the investment must be for new property and the corporation must be            
in good standing on unemployment insurance and other state taxes.              
                                                                               
This proposal will help small businesses--the lifeblood of Alaskas             
economy--to expand and thrive, thereby ensuring more Alaska private            
sector jobs and a healthy economy as we enter the next century.   This         
is one goal we all can agree on and support.                                   
                                                                               
							Sincerely,                                                              
							/s/                                                                     
							Tony Knowles                                                            
							Governor