02/26/2020 03:15 PM House LABOR & COMMERCE

                  HB 232-MUNICIPAL TAX CREDITS                                                                              
                                                                                                                                
4:50:39 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ announced that the  final order of business would                                                               
be  HOUSE BILL  NO.  232, "An  Act relating  to  a municipal  air                                                               
quality  improvement  tax credit;  and  relating  to a  municipal                                                               
energy efficient new construction tax credit."                                                                                  
                                                                                                                                
4:51:24 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRIER HOPKINS, Alaska  State Legislature, as prime                                                               
as sponsor,  gave a brief introduction  to HB 232.   The bill, he                                                               
said, is being  presented at the request of  Fairbanks North Star                                                               
Borough.  HB 232 allows  local governments to offer municipal tax                                                               
credits  to  home and  business  owners  who invest  in  property                                                               
improvements  which  result  in increased  energy  efficiency  or                                                               
local air  quality.   This bill  does not  mandate any  action by                                                               
municipalities -  it offers local governments  additional avenues                                                               
for  addressing local  challenges and  priorities.   He explained                                                               
that the  committee substitute (CS)  from the  previous committee                                                               
expanded   opportunities   for   the  construction   to   include                                                               
retrofits, refurbishments,  and remodels.   Additionally,  the CS                                                               
removed the  restriction on the air  quality improvements, making                                                               
it more  available to  all municipalities within  the state.   He                                                               
pointed out that HB  232 is a short bill.   Section 1 pertains to                                                               
the  air  quality   tax  credits  and  Section   2  involves  the                                                               
construction tax credits.                                                                                                       
                                                                                                                                
4:53:20 PM                                                                                                                    
                                                                                                                                
BRYCE WARD,  Mayor, Fairbanks North  Star Borough, said  that the                                                               
air  quality  tax  credit  and the  energy  exemption  were  both                                                               
identified as  priorities for the  Fairbanks North  Star Borough.                                                               
The  air  quality  tax  credit  was  originally  asked  to  be  a                                                               
reauthorized section of law that sunset  in 2016.  It would allow                                                               
the borough to encourage  and incentivize efficiency improvements                                                               
that  would benefit  the  air  quality issue  in  Fairbanks.   He                                                               
stated  that the  energy  efficiency exemption  is  similar.   It                                                               
allows  the  borough  to  incentivize  efficiency  and  efficient                                                               
construction.   This  would allow  the municipalities  to develop                                                               
programs   that  would   encourage  efficient   construction  and                                                               
efficient  design of  buildings.   The concept  of how  this idea                                                               
pays for itself is that  a higher efficiency building, in theory,                                                               
is  worth  more,  which  encourages higher  value  and  in  turn,                                                               
affects  the  total  (indisc.)  value   over  the  life  of  that                                                               
building.   He noted that  each program is optional,  which gives                                                               
local communities the ability to tailor them to their needs.                                                                    
                                                                                                                                
4:56:29 PM                                                                                                                    
                                                                                                                                
CHAIR SPOHNHOLZ announced that HB 232 was held over.