2009-01-26                     Senate Journal                      Page 0079
Governor's transmittal letter dated January 23:                                                                                 
                                                                                                                                
Dear President Stevens:                                                                                                         
                                                                                                                                
Under the authority of Article III, Section 18, of the Alaska                                                                   
Constitution, I am transmitting a bill relating to bonding limitations                                                          
and confidentiality of records and information of the Alaska Industrial                                                         
Development and Export Authority (AIDEA).                                                                                       
                                                                                                                                
This bill would accomplish five things. Section 1 of the bill would                                                             
exclude refunding and conduit revenue bonds from the 12-month bond                                                              
limit of the Authority. AS 44.88.095(a) precludes AIDEA from issuing                                                            
more than $400,000,000 of bonds during any 12-month period.                                                                     
Enactment of the bill would ensure that the 12-month bond limit                                                                 
would never preclude AIDEA from issuing refunding bonds to                                                                      
refinance existing development finance project debt on more favorable                                                           
terms, or from issuing conduit revenue bonds for which AIDEA has no                                                             
financial obligation to pay. Conduit revenue bonds are payable by the                                                           
project developer and related parties, primarily from revenue                                                                   
generated by the project.                                                                                                       
                                                                                                                                
Section 2 of the bill would eliminate the sunset of the statutory ability                                                       
of AIDEA issuing bonds. AS 44.88.095(g) severely limits the ability                                                             
of AIDEA to issue bonds. Before the July 1, 2007 statutory sunset,                                                              
AS 44.88.095(g) authorized AIDEA to issue most bonds without                                                                    
further legislative approval; the sole exception being bonds in excess                                                          
of $10,000,000 to assist in the financing of a development project                                                              
under AS 44.88.172 - 44.88.177. That authorization to issue bonds                                                               
ended on July 1, 2007, with the statutory sunset. AIDEA currently                                                               
requires legislative approval to issue any bonds, excepting refunding                                                           
and conduit revenue bonds.  Section 2 of the bill would amend                                                                   
AS 44.88.095(g) to eliminate the sunset and enable AIDEA to again                                                               
issue most bonds without legislative approval. AIDEA will still                                                                 
require legislative approval to issue bonds in excess of $10,000,000 to                                                         
assist in the financing of development projects, excluding refunding                                                            
bonds.                                                                                                                          
                                                                                                                                
Section 2 of the bill would also expressly clarify in statute that AIDEA                                                        
may use proceeds from refunding bonds to finance certain costs and                                                              
expenses associated with issuing the refunding bonds.