05/01/2006 09:00 AM Senate FINANCE

                                                                                                                                
     CS FOR HOUSE BILL NO. 283(STA)                                                                                             
     "An Act relating to the compensation for board members of                                                                  
     the Alaska Housing Finance Corporation; and providing for                                                                  
     an effective date."                                                                                                        
                                                                                                                                
                                                                                                                                
This was  the first hearing for  this bill in the  Senate Finance                                                               
Committee.                                                                                                                      
                                                                                                                                
MICHAEL  O'HARE, Staff  to Representative  Pete Kott,  the bill's                                                               
sponsor, noted that  a new committee substitute  is being offered                                                               
for consideration.                                                                                                              
                                                                                                                                
Co-Chair Green  moved to adopt  committee substitute  Version 24-                                                               
LS0922\F as  the working document.  She objected for  purposes of                                                               
explanation.                                                                                                                    
                                                                                                                                
Mr. O'Hare explained  that Sec. 2, page 1 line  10 through page 2                                                               
line 2,  has been added  to Version  "F". This new  section would                                                               
amend Alaska  Statute (AS) 42.04.020(f) pertaining  to the salary                                                               
paid  to  the chairperson  and  commissioners  of the  Regulatory                                                               
Commission  of  Alaska  (RCA). Existing  step  and  range  salary                                                               
schedule language  would be replaced  with language  allowing the                                                               
Governor to determine those salaries.                                                                                           
                                                                                                                                
9:27:41 AM                                                                                                                    
                                                                                                                                
Senator Olson asked the fiscal impact of this change.                                                                           
                                                                                                                                
Co-Chair Green noted that the  recent drafting of Version "F" has                                                               
not  provided sufficient  time for  RCA to  calculate the  fiscal                                                               
impact.                                                                                                                         
                                                                                                                                
Co-Chair  Green noted  that  in addition  to  the salary  changes                                                               
pertaining to the RCA chairperson  and commissioners, Version "F"                                                               
would  also increase  Alaska Housing  Finance Corporation  (AHFC)                                                               
Board  members  compensation  while attending  business  meetings                                                               
from $100 to  $400 per day. This language is  depicted in Section                                                               
1(e) on page 1 line 6.                                                                                                          
                                                                                                                                
9:29:01 AM                                                                                                                    
                                                                                                                                
KATE GIARD,  Chair, Regulatory  Commission of  Alaska, Department                                                               
of  Commerce, Community  and Economic  Development testified  via                                                               
teleconference  from an  offnet  site and  communicated that  the                                                               
compensation  changes proposed  for  the  four RCA  commissioners                                                               
would  incur  a  fiscal  impact of  approximately  $170,000.  The                                                               
fiscal  impact  of  the  compensation   for  the  chairperson  is                                                               
unknown, as the Governor would make that determination.                                                                         
                                                                                                                                
Ms.  Giard  stated  the  increased  compensation  proposed  would                                                               
expand the  range of RCA  commissioner candidates. The  RCA Chair                                                               
is  appointed   for  a  four-year  term   and  commissioners  are                                                               
appointed  for six-year  terms. Her  term as  RCA chair  began in                                                               
2002 and would terminate in 2006.  One of her objectives as chair                                                               
was "to position  the RCA to move forward into  the future". This                                                               
included a  review of commissioner  compensation, as one  of "the                                                               
challenges" facing  the Legislature  is to  recruit commissioners                                                               
willing to work very hard during  their terms and who could bring                                                               
maturity and  business experience to the  Agency. Their decisions                                                               
"would  have long-term  fiscal impact  on the  State of  Alaska".                                                               
Current Commissioners  are paid $86,000 annually,  as compared to                                                               
State  department commissioners  who earn  approximately $124,000                                                               
annually.   The   current  base   level   salary   paid  to   RCA                                                               
commissioners is insufficient to  attract a business executive or                                                               
a department  commissioner. The proposed salary  would be similar                                                               
to  that of  State department  commissioners. The  Governor would                                                               
establish the salary for the RCA chairperson.                                                                                   
                                                                                                                                
9:32:24 AM                                                                                                                    
                                                                                                                                
Senator Stedman  asked whether  an updated  fiscal note  would be                                                               
provided prior to action being taken  on the bill. In response to                                                               
a  remark   by  Co-Chair  Green,  he   acknowledged  Ms.  Giard's                                                               
testimony that  the commissioners'  salary increase  would equate                                                               
to approximately $170,000.                                                                                                      
                                                                                                                                
In response to a question  from Senator Olson, Ms. Giard affirmed                                                               
the commissioners' salary increases  would amount to $170,000 per                                                               
year.                                                                                                                           
                                                                                                                                
9:32:55 AM                                                                                                                    
                                                                                                                                
Senator Stedman observed that compensation  levels for boards and                                                               
commissions have  been a matter  of discussion in the  past. "The                                                               
issue  is broader  than just  the subject  matter in  this bill."                                                               
Thus,  the compensation  of other  boards and  commissions should                                                               
also be addressed.                                                                                                              
                                                                                                                                
Co-Chair Green acknowledged Senator Stedman's remarks.                                                                          
                                                                                                                                
The bill was HELD in Committee.                                                                                                 
                                                                                                                                
[NOTE: No action was taken on the motion to adopt Version "F".]                                                                 
                                                                                                                                
9:33:25 AM