Legislature(2021 - 2022)ADAMS 519
08/24/2021 01:00 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| HB3002 | |
| Amendments | |
| Public Testimony | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB3003 | TELECONFERENCED | |
HOUSE FINANCE COMMITTEE
THIRD SPECIAL SESSION
August 24, 2021
1:07 p.m.
1:07:29 PM
CALL TO ORDER
Co-Chair Foster called the House Finance Committee meeting
to order at 1:07 p.m.
MEMBERS PRESENT
Representative Neal Foster, Co-Chair
Representative Kelly Merrick, Co-Chair
Representative Dan Ortiz, Vice-Chair
Representative Ben Carpenter
Representative Bryce Edgmon
Representative DeLena Johnson
Representative Andy Josephson
Representative Bart LeBon
Representative Sara Rasmussen (via teleconference)
Representative Steve Thompson
Representative Adam Wool
MEMBERS ABSENT
None
ALSO PRESENT
Alexei Painter, Director, Legislative Finance Division;
Joseph Geldof, Alaska Center for Constitutional Protection
and Eric Forrer, Juneau; Representative Mike Cronk;
Representative Kevin McCabe; Representative Ken McCarty;
Representative George Rauscher; Representative Tom McKay.
PRESENT VIA TELECONFERENCE
Megan Wallace, Director, Legislative Legal Services, Alaska
State Legislature; Margaret Thomas, Self, Nome; Martin
Stepetin, Self, Juneau; Garret Abbott, Self, Ketchikan;
Gail Limbaugh-Moore, Self, Kenai/Soldotna; Chris
Eichenlaub, Self, Wasilla; Robert Himschoot, Nushagak
Electric and Telephone Cooperative, Dillingham; Ted Madsen,
Southcentral Foundation, Anchorage; Heather Anthony, Self,
Anchorage; John Erickson, City Manager, Yakutat; Terrie
Harris, Self, Anchor Point; Laura Tanis, Aleutians East
Borough, Anchorage; Pam Lee, Self, Eagle River; Michael
Kramer, Self, Fairbanks; Pam Ventgen, Executive Director,
Alaska State Medical Association, Anchorage; Rose Burgess,
Self, Anchorage; Garvin Bucaria, Self, Wasilla; Mike
Alexander, Self, Big Lake; Bert Houghtailing, Self, Mat-Su;
Loy Thurman, Chairman, Republicans of District 8, Mat-Su;
Karen Crandall, Self, Big Lake; Kathleen Shoop, Self,
Palmer; Ray Ward, Self, Anchorage; Joe Muentec, Self,
Fairbanks; Aofia Meleisea, Self, Anchorage; Marlena
Tufford, Self, North Pole; Noria Clark, Self, Anchorage;
Charles Black, Self, Anchorage; Kristin Cash, Self,
Fairbanks; Melanie Beverly, Self, Soldotna; Bridgett
Vaughn, Self, North Pole; Tamara Van Vliet, Self, Homer;
Emily Kane, Self, Juneau; Joe Westfall, Self, Anchorage;
Trevor Storrs, President and CEO, Alaska Children's Trust,
Anchorage; Lisa Hansen, Self, Kenai; Dr. Tania Hall, WWAMI,
Anchorage; Faith Howell, Self, Fairbanks; Chelse Lord,
Self, Chugiak; Ryan Apathy, WWAMI Medical Student,
Anchorage; Colleen Van Vleet, Self, Anchorage; Alex
McDonald, Self, Fairbanks; Abby St. Clair, Self, Wasilla;
Sandi Bateson, Self, Palmer; Max Kullberg, Self, Anchorage;
Kim Wise, Self, Anchorage; James Phillips, Self/Northern
Credit Services, Ketchikan; Dr. Thomas Quimby, Alaska
Chapter of American College of Emergency Physicians,
Palmer; Sabrina Woody, Self, Anchorage; Kathryne Mitchell,
WWAMI, Fairbanks; Sheila Schatz, Self, Wasilla; Timothy
Wilson, Self, Wasilla; Mike Coons, Self, Palmer; Kurt
Schmit, Self, Delta Junction; Danielle Henson, Self,
Wasilla; Dr. Herb Schroeder, University of Alaska -
Anchorage, Eagle River; Robert Gresham, Self, North Pole;
Alicia Astlund, Self, Wasilla; Rachel Allen, Self, Wasilla;
Paul Hartley, Self, Kenai; Alicia Astlund, Self, Wasilla;
Benjamin Ulan, Self, Fairbanks; Jim Ayers, Self, Juneau;
Sana Efird, Executive Director, Alaska Commission on
Postsecondary Education, Juneau; Vanessa Witt, Self,
Fairbanks; Bittner Brooks, Self, Fairbanks; Jennifer
Graham, Self, Anchorage; Connie Owen, Self, Wasilla; Esther
Reem, Self, Palmer; Kaylee Evans, Self, Fairbanks; Julian
Hiner, Self, Kodiak; Jodie Mitchell, CEO, Inside Passage
Electric Cooperative, Juneau; Sean Loug, Self, Fairbanks;
Mathew Maixner, Self, Juneau; David Nees, Self, Anchorage;
Kaitlyn Logue, Self, Fairbanks; Michael Walker, Self,
Sterling; Michelle Barnes, Self, Soldotna; Jordan Woods,
Self, Anchorage; Paul D. Kendall, Self, Anchorage; Tammy
Schmidt, Self, Wasilla; Judi Bartlett, Self, Soldotna;
Christina Hansen, Self, Fairbanks; Leonard Custis, Self,
Houston; Louis Imbriani, Self, Eagle River; Diana Chadwell,
Self, Delta Junction; Karen Perry, Self, Chugiak; Chris
Draper, Self, Alexander Creek; Robert Jewett, Self,
Wasilla; Lisa John, Self, Fairbanks; Duane Evertson, Self,
Big Lake; Deborah Park, Self, Anchorage; Jan-Marie
Bearfield, Self, Juneau; Renn Nelson, Self, Craig; James
Squyres, Self, Deltana; Anita Samuel, WWAMI, Anchorage;
Terry Vanleuven, Self, Juneau; Manoli Malamute, Self,
Fairbanks; Brian Vanderwood, Self, Anchorage; Dwight Lane,
Self, North Pole.
SUMMARY
HB 3003 APPROP: OPERATING; PERM FUND; EDUCATION
HB 3003 was HEARD and HELD in committee for
further consideration.
[Note: Meeting was continued the following
morning and the bill was reported out of
committee. See separate minutes dated 8/25/21
10:00 a.m. for detail.]
HOUSE BILL NO. 3003
"An Act making an appropriation from the general fund
to the Department of Education and Early Development
for the payment of educational programs; making an
appropriation from the earnings reserve account for
the payment of permanent fund dividends; making an
appropriation from the earnings reserve account to the
budget reserve fund; and providing for an effective
date."
Co-Chair Foster relayed that the committee would hear
amendments and public testimony on HB 3003.
1:08:36 PM
^AMENDMENTS
1:08:39 PM
Representative Rasmussen MOVED to ADOPT Amendment 1, 32-
GH3353\A.4 (Marx, 8/20/21) (copy on file):
Page 1, line 5, following "fund":
Insert "(art. IX, sec. 17, Constitution of the State
of Alaska); making an appropriation to the oil and gas
tax credit fund;"
Page 5, following line 7:
Insert a new bill section to read:
"* Sec. 5. OIL AND GAS TAX CREDIT FUND. The sum of
$114,000,000 is appropriated to the oil and gas tax
credit fund (AS 43.55.028), from the following
sources:
(1) $54,000,000 from the general fund;
(2) $60,000,000 from the receipts of the Alaska
Industrial Development and Export Authority (AS
44.88)."
Renumber the following bill sections accordingly.
Page 5, line 8:
Delete "APPROPRIATION"
Insert "APPROPRIATIONS"
Delete "sec. 4"
Insert "secs. 4 and 5"
Page 5, line 9:
Delete "a fund"
Insert "funds"
Page 5, line 10:
Delete "sec. 4"
Insert "secs. 4 and 5
Vice-Chair Ortiz OBJECTED for discussion.
Representative Rasmussen explained that the amendment would
fully fund the oil and gas tax credits with $54 million
from the General Fund and $60 million in Alaska Industrial
Development and Export Authority (AIDEA) receipts. She
detailed the amendment contained the same language that was
included in the budget bill that passed the House in June.
She highlighted that the tax credits were obligations made
by the state, which had not been paid for three years. She
explained that the administration had made efforts to pay
the credits with bonds. She stated that in 2018, the
legislature had made a conscious decision to extend the
qualifying expenditures for the tax credits. She elaborated
that the state had actively solicited private sector
investment based on a promise to follow through on the tax
credits. She believed it had been one of the driving
factors in the Cook Inlet gas "fiasco" causing Anchorage to
experience brownouts due to energy shortages. She expounded
that by encouraging companies to invest in the Cook Inlet,
Anchorage had been able to provide gas for its schools,
hospitals, private homes, and businesses. She labeled the
situation as a success on top of all of the discoveries
made on the North Slope.
Representative Rasmussen stated legislators had all seen
the major financial institutions such as Goldman Sachs,
Wells Fargo, and Bank of America announcements in the past
two years that they would not invest in oil and gas
projects in the Arctic. She thought it was another major
hurdle for Alaska. She reasoned smaller financial
institutions would play a large role in partnering with
producers to ensure Alaska was able to develop its
resources. She asked for members' support on the amendment.
1:11:03 PM
Representative Josephson requested to have Alexei Painter
come up for questions.
Representative Josephson appreciated Representative
Rasmussen offering the amendment; however, it was his
understanding that on midnight on the 30th of June, General
Fund money had been swept. He thought the funds would come
from FY 22 revenue coming in over the course of time.
ALEXEI PAINTER, DIRECTOR, LEGISLATIVE FINANCE DIVISION,
responded affirmatively.
Representative Josephson asked what the remaining [General
Fund] balance would be if the $54 million was spent.
Mr. Painter responded that under the current bill version
with the Permanent Fund Dividend (PFD) paid directly from
the Permanent Fund Earnings Reserve Account (ERA) there was
an estimated surplus of $536.6 million. The $54 million
would reduce the number to approximately $390 million. He
noted that the number would change if other amendments in
the packet (copy on file) were adopted.
1:12:47 PM
Representative Josephson asked what the balance would be if
a separate amendment on the dividend were adopted. He
observed that it would clearly reduce the surplus.
Mr. Painter answered that the post-transfer was estimated
at about $115 million when factoring in a reduction of
$400.5 million from the General Fund in Amendment 2 and a
separate $21.4 million currently in the numbers section of
the bill. He explained that if Amendment 1 were to pass,
the balance would be further reduced by $54 million to an
estimated post-transfer surplus of roughly $60 million.
Representative Josephson thought the amendment almost had
the feel of a supplemental item. He remarked that if there
were no reverse sweep and the scores of other items that
were left unfunded, all of the projects would theoretically
have to compete in January for the remaining fund balance.
He asked if his understanding was accurate.
Mr. Painter responded in the affirmative. He elaborated
that under the assumption of no access to the
Constitutional Budget Reserve (CBR), the remaining $60
million would be the remaining balance under the spring
forecast. He noted that due to the volatility of oil
pricing, if prices ended up higher there could be more
money and if prices were lower there could be no money left
over.
Co-Chair Foster acknowledged Representatives Mike Cronk,
Ken McCarty, Kevin McCabe in the audience.
1:15:04 PM
Vice-Chair Ortiz thanked Representative Rasmussen for
introducing the amendment. He stated he had voted in
support of meeting the oil tax obligations during the
regular session. He did not dispute the need to pay the
credits. He was concerned that using $54 million from the
General Fund to pay a portion of the credit obligation
would put the state dangerously close to being unable to
meet funding obligations that could arise due to unforeseen
circumstances. For example, revenue could fluctuate
quickly. He pointed out that with the $54 million coming
from the General Fund, at oil prices of $61 per barrel,
there would be a remaining General Fund balance of about
$60 million. Whereas, at $59 per barrel there would be an
unfilled obligation of $4 million. He stressed that moving
forward with the amendment as currently drafted could put
the legislature in a bind of being unable to meet
obligations due to a lack of revenue. He remarked that he
had a potential remedy, but he wanted to continue the
current discussion prior to offering a change.
1:16:55 PM
Representative Carpenter asked for an explanation of the
surplus mentioned previously. He asked where the number had
come from.
Mr. Painter replied that based on the enacted budget, there
was an estimated post-transfer surplus of $536.6 million.
He detailed the amount was based on the expected revenue
under the spring forecast, the use of $250 million in
American Rescue Plan Act (ARPA) revenue replacement, and
the use of the Statutory Budget Reserve (SBR). The surplus
resulted from the vetoes; there had not been a surplus at
the end of regular session. He clarified that HB 3003
currently contained the general funds to offset the higher
education costs at approximately $21.4 million. He stated
that the amount would be deducted from the bill as
currently constructed. He elaborated that subtracting an
additional $400.5 million for Amendment 2 would further
reduce the surplus (because its fund source was partially
the General Fund rather than the ERA as currently
constructed in the bill).
Representative Carpenter stated that he liked the amendment
and thought the state should pay its debts; however, he was
concerned about the funding sources. He asked for
clarification on the CBR and SBR balances after the sweep.
Mr. Painter answered the current situation was a little odd
where the bill was different than the scenario under
discussion. He relayed there was currently about $1 billion
in the CBR and SBR assuming the reverse sweep took effect.
He elaborated that without the reverse sweep the balances
of the Higher Education Fund and other funds were also
included in the balance. He explained that Amendment 2
would reduce the amount that would lapse into the CBR;
however, without a three-quarter vote allowing CBR access,
the CBR balance was irrelevant because it was inaccessible.
He expounded that there was no backstop if there was a
shortfall in revenue because there was currently no access
to the CBR, SBR, or any other fund currently as in the
budget.
Representative Carpenter asked Mr. Painter to be more
specific about the amount in the CBR versus the SBR.
Mr. Painter replied that assuming the SBR balance was
available, which was not a given because it had been
subject to the sweep in the past, there would be $330
million left in the SBR. He detailed that the total
reflected the amount of governor veto items (from the
conference committee budget) funded from the SBR. The
remaining amount would be in the CBR, and the amount would
vary based on whether there was a reverse sweep and what
else was taken out of the General Fund in FY 22.
Representative Carpenter asked how to get to the
determination of whether the funds in the SBR would be
swept or not. He stated the information was germane to the
current conversation about where to fund HB 3003 if they
were looking for fund sources other than the General Fund.
He asked if Legislative Legal Services could provide
insight into the situation.
1:21:15 PM
MEGAN WALLACE, DIRECTOR, LEGISLATIVE LEGAL SERVICES, ALASKA
STATE LEGISLATURE (via teleconference), responded that she
could not answer when or how the legislature would know
whether the SBR would be sweepable. She stated that the
issue arose as a consequence of the Power Cost Equalization
(PCE) litigation. She detailed that the SBR had
historically been categorized as a sweepable fund; however,
a Superior Court judge had recently ruled in a case brought
by the Alaska Federation of Natives (AFN) that the
legislature had the power to establish and create funds
outside of the General Fund. The judge had specifically
noted the legislature had created separate funds.
Ms. Wallace elaborated that the footnote associated with
the court analysis indicated that the SBR was a separate
fund in the state treasury. She furthered that it seemed
apparent in the Superior Court's analysis that the SBR was
outside the General Fund and under the same category as the
PCE litigation, meaning it could be considered as not
subject to the sweep. Ultimately, the administration would
decide on which funds were sweepable and the Superior Court
decision did not specifically order against sweeping the
SBR. She stated it was her understanding that the
legislature had not received confirmation in terms of the
administration's reevaluation of the sweepable funds list
in light of the legal opinion. The legislature would either
receive an announcement from the administration or through
potential further litigation on the sweepability of the
fund. She noted that the decision was not currently
expected to be appealed to the Alaska Supreme Court.
Representative Carpenter appreciated Ms. Wallace's answer.
He asked how much of the funding remained after applying it
toward the FY 22 budget if the SBR was not swept in the
CBR. He wondered what the funding obligation was for the
budget.
Mr. Painter responded that the Legislative Finance Division
(LFD) would estimate that $330 million was unobligated,
which was the amount of the governor's vetoes. He noted
that some of the $325 million that went into the SBR was
from a certain designated amount, while the remainder was
from projected lapse. He explained that the lapse amount
was based on the administration's best guess; therefore,
the figure may be higher or lower when the audit was
completed in December or February.
Representative Carpenter stated his understanding that
either a lawsuit would challenge the sweepability of the
SBR or the administration would decide whether the SBR was
swept or not. Additionally, the SBR funding approved in the
previous budget would continue to be funded; therefore,
only $330 million remained in the SBR if the specific chain
of events took place. He asked for the accuracy of his
statements.
Mr. Painter agreed. He stated that the $80.7 million of
appropriations made out of the SBR would be funded if the
governor or a court determined the account to be
unsweepable.
1:26:13 PM
Co-Chair Foster acknowledged Representatives Tom McKay and
George Rauscher in the audience. He noted that Co-Chair
Merrick had joined the meeting.
Representative LeBon supported Amendment 1. He observed
that the proposed $60 million draw from AIDEA receipts
should be a one-time event. He cautioned it was a slippery
slope to draw capital from an investment fund the state
relied on for future investment dollars. He asked for the
current total oil and gas tax credits liability. He asked
what the amount would be after a $114 million payment as
proposed under the amendment.
Mr. Painter answered there was approximately $740 million
in outstanding credits based on the spring forecast
estimates. The amendment would reduce the obligation to
about $630 million.
Representative LeBon asked for verification that the
proposed $114 million was based on a formula.
Mr. Painter responded that he was correct. The payment was
based on the statutory formula for the state's annual
contribution.
Representative LeBon asked what the future payment schedule
may look like for the next five to seven years.
Mr. Painter answered that based on the statutory payments
and spring forecast there would payments for five
additional years in the $100 million or so range and a
smaller payment of the remaining obligation in FY 27. He
noted that as the forecast changed, the precise schedule
would change.
Representative LeBon highlighted that the future annual
obligation was a similar amount to the amount owed in FY
22. He had heard there may be a proposal based on approval
of Amendment 1 to satisfy the remaining oil and gas tax
credits through a financing instrument that may be
available to holders. He asked if Mr. Painter was aware of
any possible resolution to make tax credit holders whole
that would allow them to utilize the money for future
development.
Mr. Painter responded that he was not familiar with a
proposal.
1:30:32 PM
Representative Wool stated that he had supported the
approval of the tax credits in the budget and believed the
CBR had been used as a funding source. He asked the
amendment sponsor why the amendment did not utilize a CBR
mechanism as it had previously. He was concerned about the
balance of the General Fund if $54 million was taken out.
He remarked that even a $2 shift in oil prices would have a
significant impact on the General Fund balance.
Representative Rasmussen believed the original funding
approved by the House was spilt between the General Fund
and AIDEA receipts. She stated her understanding that the
use of CBR as a fund source had come from the conference
committee. She stated that unfortunately when the three-
quarter [vote on the CBR] threshold had not been met, the
funds had not been released. She shared concerns about
using funds from the General Fund; however, she pointed out
that the state still received a substantial amount of money
from the oil industry and $1 billion was nothing to scoff
at. She thought if the state wanted to continue to grow
General Fund dollars from the private sector and see the
investment into oil and gas industry, it was necessary to
show Alaska was a good partner and would follow through on
its contracts. She believed all committee members wanted to
have money available for schools, infrastructure, public
safety, and things that were important to communities;
however, she thought it was important to think long-term
and use funding to create confidence with the private
sector. She thought there would be smaller balances in the
General Fund in the near future if the obligation was not
honored and it would be necessary to talk about cutting
programs.
Representative Wool understood that the oil tax credit
obligations went back to a certain year around 2014 or
2015. He knew the state had paid out $100 million in the
past. He believed who had received money and how much they
had received was public record. He noted that $114 million
was a similar number. He was aware that some of the monies
owed by the state had been bought by investment companies
that traded tax credits. He asked how much of the $114
million would go to companies currently developing on the
North Slope (i.e., Pikka and others).
Mr. Painter responded that he could not provide the
information. He stated that when credits were paid it
became public information, but who held the credits at
present was not public information. He informed the
committee that DOR had statutory guidance about how to
apply payments made by the legislature to existing credit
holders. The guidance included when the credits were
received and other components including Alaska hire. He
explained it would be very difficult from the outside to
determine ahead of time who may receive payment for the
credits. He did not believe DOR could provide the
information given confidentiality.
Representative Wool asked if the recipients of the last
$100 million payment was public information.
Mr. Painter indicated the information was available.
1:35:34 PM
Representative Wool asked if it was possible to extrapolate
from data on the previous payment what the next payment
would look like.
Mr. Painter agreed it would be possible to estimate, but
LFD had not done so.
1:36:13 PM
AT EASE
1:37:58 PM
RECONVENED
Vice-Chair Ortiz MOVED to ADOPT conceptual Amendment 1 to
Amendment 1 (copy on file):
Line 9: Delete "general fund" and insert
"Constitutional Budget Reserve."
Co-Chair Foster OBJECTED for discussion.
Vice-Chair Ortiz stated that he fully supported paying the
oil and gas tax credits obligation owed by the state. He
noted he had voted for paying the credits earlier in
session. He highlighted that as currently written,
Amendment 1 would draw down on the General Fund to a risky
level, which could prevent the state from meeting its
obligations if a drop in oil prices or something else
occurred. He explained that the conceptual amendment would
replace the General Fund funding source with the CBR. He
elaborated that rather than funding $54 million with
General Fund dollars, the conceptual amendment would fund
the $54 million with CBR funds.
1:39:53 PM
Representative Rasmussen asked Mr. Painter or Ms. Wallace
if the conceptual amendment could potentially put the
legislature in a situation where the oil tax credits would
go unfunded if the bill did not receive the necessary vote
threshold.
Mr. Painter agreed that the credits would not be funded if
the CBR vote threshold was not met by the legislature.
Co-Chair Foster clarified his understanding that only the
$54 million from the CBR would be unfunded under the
scenario provided. He believed the $60 million would still
go forward.
Mr. Painter agreed. He explained that it would be different
than the previous situation where no funding had been
approved. He confirmed that the $60 million from AIDEA
receipts would be maintained under the scenario.
Representative Rasmussen believed committee members were
all aware of the politics in the building at present. She
explained the intention behind Amendment 1 was to create
confidence with the private sector. She elaborated that the
state had gone into the obligation knowing what would be
expected. She thought it seemed disingenuous to say the
state supported something, while using a funding mechanism
that would likely fail. She spoke to the importance of
paying the obligation in the current year. She stated that
the payment had not been made in the past several years.
She reasoned that if the desire was for increased revenue
for more programs and projects, it was necessary to
increase investment in Alaska. She believed Amendment 1
provided a step in the right direction. She opposed
conceptual Amendment 1 to Amendment 1.
Vice-Chair Ortiz addressed the mechanics of the CBR vote.
He asked if there could be a vote specifically on the $54
million item separate from the rest of the sweep.
Mr. Painter confirmed there could be a CBR vote on
individual items.
1:43:08 PM
Representative Wool stated that in FY 20 and FY 21 there
were no payments [made to the oil tax credit obligation].
He elaborated that the following payments had been made:
$30 million in FY 17, $77 million in FY 18, $100 million in
FY 19. Prior to the aforementioned payments there had been
a one-time payment of $3.8 billion. He remarked that the
state had paid out a substantial amount of oil credit tax
money. He disputed the claim that the state had not
fulfilled contractual obligations. He speculated that if
the payment of tax credits was the only vote on the CBR he
could see how it would pass.
Representative LeBon spoke against conceptual Amendment 1.
He believed the committee had heard from Mr. Painter there
was sufficient General Fund revenues pay the obligation. He
took the obligation of paying the oil and gas tax credits
very seriously. He stated the legislature needed to reflect
the commitment to pay the credits. He believed there was an
opportunity for the credit holders to leverage the state's
performance by paying $114 million toward the credits. He
stated it was a chicken and egg situation that required the
performance and payment of dollars in order to open the
window of opportunity. He thought there was the potential
for greater benefit to the credit holders in future years.
He noted there was also benefit to the state because the
monies would be available for future development by oil and
gas companies holding the credits.
Vice-Chair Ortiz made closing comments on the conceptual
amendment. He believed the votes would be obtained given
widespread support in the House for paying the credits and
because the legislature could vote specifically on a $54
million appropriation to fund oil tax credits out of the
CBR.
Co-Chair Foster WITHDREW the OBJECTION.
Representative Carpenter OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: Josephson, Ortiz, Wool, Foster
OPPOSED: Carpenter, Edgmon, Johnson, LeBon, Rasmussen,
Thompson, Merrick
The MOTION to adopt conceptual Amendment 1 to Amendment 1
FAILED (4/7).
1:47:28 PM
Vice-Chair Ortiz MOVED to ADOPT conceptual Amendment 2 to
Amendment 1 (copy on file):
Line 9: Delete "$54,000,000 from the general fund;"
Line 10: delete "60,000,000" and insert "$114,000,000"
Co-Chair Foster OBJECTED for discussion.
1:47:40 PM
AT EASE
1:49:24 PM
RECONVENED
Vice-Chair Ortiz explained that the conceptual amendment
specifically addressed the funding source in Amendment 1.
He emphasized that adopting Amendment 1 as written would
put the state in a precarious situation. Additionally, he
believed adopting Amendment 1 as written sent the message
that the legislature prioritized funding oil tax credits
over many other things that had been vetoed or swept that
were not resolved by HB 3003. He listed various other items
that were left unresolved including [Alaska] Legal Services
and Pre-K funding. He felt that including the funding
source as written gave the impression the legislature did
not think the items were as important as meeting the
state's obligations to oil companies. He reiterated he was
in support of paying the state's obligations.
Vice-Chair Ortiz explained that the amendment would delete
$54 million coming from the General Fund. He detailed that
conceptual Amendment 2 would pay the entire $114 million
with AIDEA receipts. He elaborated that the payment would
not impact General Fund obligations and created more
flexibility in the event of unforeseen circumstances.
1:51:24 PM
Representative LeBon asked how a $114 million draw against
AIDEA's capital would impact the agency. He asked for the
agency's current capital level.
Vice-Chair Ortiz replied that he could not specifically
answer the question. He thought Mr. Painter or others may
be able to answer how the draw would impact AIDEA. He
recalled there had been past discussion earlier in the year
about paying the oil tax credits with AIDEA funds.
Representative LeBon stressed that the analysis of the
proposed action was a critical part of the vote. He did not
know whether an analysis had been done. He was disinclined
to put Mr. Painter or anyone else on the hook to come up
with a quick analysis of the impact. He highlighted that
removing the capital from an investment agency like AIDEA
impaired the agency's ability to make future investments.
He referenced his earlier concern about using $60 million
in AIDEA funds. He underscored he was very cautionary about
taking $114 million action against AIDEA's capital. He did
not support the proposal.
1:53:32 PM
Representative Rasmussen believed when the amendment had
originally been passed in the operating budget there had
been a certain comfort with the $60 million threshold
communicated by AIDEA. She shared Representative LeBon's
concerns that the committee did not know the impact of the
conceptual amendment on AIDEA. She asked if it was possible
to hear from AIDEA or LFD.
Co-Chair Foster asked to hear from Mr. Painter.
Mr. Painter replied that he did not have updated
information. He had an email from the executive director of
AIDEA dated March 5, 2021, when the subject had been in
front of other committees. The email stated at the time,
AIDEA had $398.8 million in reserves and the reserves
earned between 3.5 to 9 percent when they were invested in
projects. When the funds were not invested in projects, the
five-year average earnings had been 4.58 percent. He
indicated the 3.5 to 9 percent (the funds could earn if
invested) represented the opportunity costs.
Representative Rasmussen asked what the investment return
would be on the $54 million if the funds were left in the
General Fund.
Mr. Painter answered that the General Fund was not invested
because it was used for ongoing cash flow. He did not
believe there would be a direct investment return on the
funds [if they were left in the General Fund].
1:56:03 PM
Representative Josephson commented that in the current
administration's first year (FY 20) it had a plan to take
an excessive $200 million of receipts. He was not 100
percent certain on the amount, but he recalled the
administration trying to marshal all available assets and
the use of the receipts had been part of its fiscal plan to
pay for things without raising revenue.
Representative Wool referred to Representative LeBon's
comments about taking away investment opportunities for
AIDEA. He had recently read AIDEA was allowing foreclosure
on its Mustang properties on the North Slope. Additionally,
he stated AIDEA was one of the predominate investors in
Alaska National Wildlife Refuge (ANWR) leases with an
annual lease amount. He stated that the entity's
investments in the North Slope did not always work out. He
surmised that perhaps it was not a bad thing for AIDEA to
have fewer investment funds.
Representative LeBon replied that it was a slippery slope
to reduce AIDEA's capital just because it may make a
mistake. He asked if AIDEA enjoyed a stronger capital
market risk rating based on its $400 million value in
relationship to any investments. He remarked that many of
AIDEA's investment decisions were funded through bond
sales. He noted that the interest rates on the bonds
reflected AIDEA's capitalization. He asked if the statement
was fair. He asked Mr. Painter to comment.
Mr. Painter responded that he did not have a strong opinion
on the specific issue. He stated that generally credit
raters would cite things like assets on hand. Additionally,
one of the credit ratings had cited the risk of the state
appropriating the agency's funds had been identified in one
of the risks to AIDEA's credit. He noted it was what the
conceptual amendment proposed to do.
Representative LeBon explained that AIDEA needed to build
confidence in the purchasers of its bonds when bonding a
project. He elaborated that part of building the confidence
was AIDEA's ability to honor the bonds through a project or
through the entity's capital or net worth. He stated that
was how banks worked. He did not know if AIDEA set aside a
reserve for investment loss or drew on its capital as part
of its planning. He did not believe AIDEA would ever want
to default on any of its bonds. He stated that the entity
would want to honor its bonds in every case even if the
project was impaired at some level. He reiterated his
opposition to the conceptual amendment.
Vice-Chair Ortiz appreciated the comments that had been
made on his conceptual amendments. He understood how
reducing AIDEA's resources made the entity less able to
fulfill some of its investment opportunities. However, he
stressed that adopting Amendment 1 in its original form
would put the state's funding mechanisms used to fund its
obligations in a precarious situation. He stressed that
legislators' primary obligation was to be good stewards and
meet its own obligations put forward in appropriation
bills. He appealed to legislators who were more cautious by
nature and thought putting the state's finances in a more
precarious situation did not jive with the philosophy.
Representative LeBon commented that if the amendment
failed, perhaps the funding source should be shifted to the
Alaska Housing Finance Corporation (AHFC) "because we
haven't picked on them yet."
Co-Chair Foster WITHDREW the OBJECTION.
Representative Carpenter OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: Josephson, Ortiz, Wool, Foster
OPPOSED: Edgmon, Johnson, LeBon, Rasmussen, Thompson,
Carpenter, Merrick
The MOTION to adopt conceptual Amendment 2 to Amendment 1
FAILED (4/7).
Representative Carpenter MOVED to ADOPT conceptual
Amendment 3 to Amendment 1. He explained that the amendment
would increase the amount to be paid from $114 million to
$774 million (the total amount of the state's debt in oil
tax credits). Additionally, the amendment would change the
fund source from General Fund and AIDEA receipts to the
ERA.
Representative LeBon OBJECTED for discussion.
Representative Edgmon stated that he could not support the
amendment. He cited the Permanent Fund earnings in the 20
percent range in the past year. He highlighted that the
state's debt obligation would be satisfied with $114
million in the current year. He referred to comments by
Representative LeBon about the need to analyze the
decisions before bringing them up. He did not believe it
made sense to go above and beyond the amount owed in the
current year. He believed Representative LeBon had stated
that if $114 million was approved by the committee it would
leverage additional funds and may have some impact on the
total outstanding amount of $726 million as reported by DOR
or another amount such as $740 million. He asked for
clarification on the statement.
2:05:27 PM
Representative LeBon clarified that he was referring to an
opportunity the credit holders may have to sell their
credits at a discounted price to an investor group or
financial institution to get some of their dollars back at
the present time versus over the next five or six years. He
did not know whether it would happen. He remarked that the
state's obligation to pay the credits was not reduced by
the action because the motivation of the investor group to
purchase the credits was some kind of a return and not just
face value. He stated the option was a mechanism to get
paid up front rather than over five or six years. He had
heard from industry that there may be a deal on the table
to allow the possibility, but it was predicated on payment
of the $114 million.
Representative Wool did not support the amendment. He did
not want to overdraw the ERA to pay off oil tax credits. He
was supportive of paying the $114 million obligation for
the current year. He did not believe it was necessary to
pay off the entire amount [due over the next five or six
years]. He indicated there was a list of recipients that
would get some of the money, some were working on the North
Slope presently and others were not. He stated that some
companies such as Oil Search would not receive any of oil
tax credit. He thought some of the work being done on the
North Slope was being done independent of the oil tax
credits. He stated that if there was oil and the price was
right, companies would find it. He highlighted that in the
past couple of years when there had been no oil tax
credits, there had been significant activity up north. He
reiterated that he did not want to overdraw the ERA.
Representative Carpenter explained the logic behind the
amendment. He was tired of having the private sector take
the back seat to government spending. He believed it was
the argument being made when investment earnings were
juxtaposed against economic growth. He underscored that the
oil sector was under stress like never before. He stated
oil prices were low and there was a hostile federal
administration. He elaborated that the oil industry was one
of the largest sources of jobs and state revenue. He noted
that when the oil market was doing well, the oil industry
was a large source of charitable giving in communities.
Representative Carpenter stated that every year the
legislature squabbled over how to pay for the state's
debts. He remarked that the legislature did not talk about
the opportunity cost the squabbling caused when there was
doubt as to whether the debts would be paid. He thought the
committee could talk all day about the importance of
investment earnings, but it should not be a discussion in a
vacuum. He thought paying off the state's debts with the
massive investment earnings in the current year would be a
wise use of the state's money. He stated it was not every
day that the legislature had the ability to set conditions
for favorable economic activity. He underscored that
favorable economic activity would be generated by paying
the state's debts at present. He pointed out it would
reduce annual uncertainty regarding the credits. He
understood the politics in the building related to spending
the ERA. He asked if the current problem with regard to
economic activity and state revenues was less important
than future use of the fund. He reiterated that the
obligation would be a wise use of the state's money.
2:12:25 PM
Representative Rasmussen was conflicted on the amendment.
She supported the concept of paying off a debt. She thought
it would make more sense to pay off a liability when the
market was on the downturn. She was concerned about losing
potential investment when the fund was making 20 percent
returns. She considered the idea of making the grand
gesture and demonstrating the state was operating in good
faith. She referenced challenges with the federal
administration on North Slope and resource projects. She
asked if the sponsor of the conceptual amendment had
thoughts on the timing of the payment.
Representative Edgmon asked for clarification on the
perception that every dollar paid in oil tax credits
generated a dollar toward economic activity. He stated his
understanding that the $114 million would primarily be
divided between three entities including Repsol,
Cornucopia, and Caelus. He noted that Repsol would receive
about one-third of the amount at around $27 million. He
pointed out that Caelus had moved out of the state. He did
not agree with the implication that paying off the debts
was by extension an investment in economic activity. He
underscored that much of the debt was owed to companies
without any activity in Alaska. He did not agree with the
perception that $1 from the ERA, which was currently
earning a considerable amount, transferred to another
entity would generate economic activity.
2:15:18 PM
Representative Wool remarked that he kept hearing comments
that the state did not fulfill its obligation. He pointed
out that the state had paid $3.8 billion in oil tax credits
between 2007 and 2016. Additionally, annual payments had
been made in 2016 through 2018. He noted that the state was
paying cashable oil tax credits, which he stated was
unusual because typically a credit was toward future money
owed to the state. He added that the state had stopped the
practice. He thought it was a misstatement to say that the
state had not paid its obligations.
Representative LeBon encouraged members to take the current
action to pay the $114 million. He pointed out that the
legislature could discuss whether to pay the remaining
balance from the ERA over the next budget cycle if desired.
Representative Carpenter appreciated the robust discussion.
He underscored there were consequences to not paying the
state's $774 million debt incurred years back. He believed
it was a travesty that the state had not paid the debt at
the time it was incurred. He speculated that perhaps the
companies would still be working in Alaska if the state had
paid its debts. He thought it was a disingenuous argument
to point to companies leaving the state who were owed money
by the state and claim that the ability for the state to
pay its debts in full would somehow not benefit Alaska's
economy. He addressed the immediate impact of paying money.
He recognized that if a company was no longer investing in
Alaska, the payment would not directly impact the state.
However, he pointed to the uncertainty existing within the
economy within major players making investment decisions
about how they would be treated in Alaska. He stressed that
the impact was difficult to measure.
Representative Carpenter agreed some companies had moved on
from the state. He underscored there had been a crisis in
the oil market and at the state level related to not paying
debts. He stressed that both situations had a damaging
impact on Alaska's economy. He addressed Representative
Rasmussen's question about the timing of when to use
investment earnings. He argued that if the will of the body
did not exist currently when earnings were high, the will
would evaporate when earnings were on the decline. He
believed it was prudent for investors to consider using
earnings when earnings were positive to use them for good
purposes. He referenced the 6 or 7 percent investment
interest the state hoped to receive and highlighted the 20
percent return [in the past year]. He considered a scenario
where the state had not benefited from the high return.
Representative Carpenter asked members to imagine the
alternative where the legislature had used some of the
money to solve some of the state's problems such as
reducing the budget by $100 million annually. He emphasized
if there was a market crash, the opportunity to reduce the
budget went away. He stated that if AIDEA was looked at as
a piggy bank to raid, the legislature would have the
conversation every year as long as the debt existed. He
stressed that AIDEA was supposed to directly benefit
investment in private businesses. He did not agree with
putting the private sector economy in the back seat.
Representative Wool MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Johnson, Rasmussen, Thompson, Carpenter
OPPOSED: Josephson, LeBon, Ortiz, Wool, Edgmon, Merrick,
Foster
The MOTION to ADOPT conceptual Amendment 3 to Amendment 1
FAILED (4/7).
2:22:09 PM
Co-Chair Foster returned to the original Amendment 1 that
would pay the oil tax credits with $54 million from the
General Fund and $60 million in AIDEA receipts.
Representative Josephson provided a 19th century quote by
Otto von Bismarck, "Politics is the art of the possible."
He wanted listeners to know it was always an issue in the
building. He stressed there were scores of funds being
swept that should be no less prioritized than oil tax
credits. He listed items such as spill prevention, tobacco
mitigation, behavioral health due to alcohol and drugs,
recidivism, marijuana education tax, workforce development,
and more. He highlighted that when the administration had
vetoed $440 million two years back, the legislature had
restored $160 million. He stated it had not happened with a
vetoed package exceeding $200 million that the majorities
believed were worthy expenditures on behalf of the people.
He stated that oil and gas tax credits were important, and
he had been happy to support paying the entire $114 million
required by law. He would vote for the amendment, but he
did not believe the credits were more important than a
plethora of other items the legislature had been unable to
come together to protect for the benefit of the people of
Alaska.
Representative Wool shared some of the sentiments expressed
by the previous speaker. He stated that he had supported
the payment of oil and gas tax credits when addressed by
the committee previously. He had supported the funding
structure in the amendment as well. He believed it was an
obligation that the state should pay. He thought the
legislature should also be addressing other vetoes. He
believed some of the items were as or more important than
the oil tax credits. He did not believe the state would see
a sudden flurry of activity based on the oil tax credits.
He noted that Exxon, ConocoPhillips, and Hilcorp were not
getting oil tax credits because the companies were too big.
He stated that Oil Search was a new company and would not
receive the credits. He listed other companies.
Representative Rasmussen appreciated all of the comments
and debate on the amendment. She agreed with Representative
Wool that the state would not see instant investment after
the payments were made; however, she believed the state
needed to rebuild trust with the private sector. She
highlighted that the state had not made the payments for
several years. She pointed out that the state would not
have a PFD without oil revenue. She stated her
understanding that Hilcorp had benefitted from tax credits
in Cook Inlet. She thought the company had been made whole.
She stated that Repsol was connected to Oil Search, which
was actively deciding on the large Pikka project. She
stated given what the state had seen with the Willow
project at the federal level, she thought Alaskan fields
needed every shot the legislature could give them to move
forward and begin drilling. She agreed there were many
important services funded by the state; however, she noted
that programs could not be funded without incoming revenue.
She hoped paying the credits would be a first step toward
rebuilding confidence with the industry. She noted the
funds were important to small companies. She remarked that
the legislature would still have access to the CBR and
AIDEA funds in the next year if there was an issue with
fund levels in the General Fund. She stressed that Alaska
had actively solicited companies to participate in its
program to make investment. She asked for members support
on the amendment.
Co-Chair Foster MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Josephson, LeBon, Ortiz, Rasmussen, Thompson,
Wool, Carpenter, Johnson, Merrick
OPPOSED: Edgmon, Foster
The MOTION to ADOPT Amendment 1 PASSED (9/2). There being
NO further OBJECTION, Amendment 1 was ADOPTED.
2:30:00 PM
AT EASE
2:40:37 PM
RECONVENED
^PUBLIC TESTIMONY
2:41:18 PM
Co-Chair Foster OPENED public testimony. He asked
testifiers to limit their remarks to two minutes. He
provided the House Finance Committee email information.
2:44:15 PM
MARGARET THOMAS, SELF, NOME (via teleconference), stated
that the oil tax credit payment was one of many programs
needing funding. She shared information about her personal
background. She had arrived in Alaska in 1981 for a summer
internship with Alaska Legal Services. She highlighted the
need for services for poor people throughout Alaska,
particularly in the northwest. She had worked for the
agency until 1996. She spoke to the background of the
agency's budget. She stressed there were very few resources
for civil advice in legal cases in rural Alaska, especially
for those unable to pay for private attorneys. She stated
one of the most important things the agency could do was to
help people maintain and obtain clear title to land in
order to qualify for housing. She listed other services
provided by the agency. She spoke to the drastic housing
crisis in rural Alaska.
2:47:15 PM
MARTIN STEPETIN, SELF, JUNEAU (via teleconference), did not
support the governor's proposal to overdraw the Permanent
Fund to pay for the Permanent Fund Dividend (PFD). He
stated that the proposal went against the law and took from
future generations. He stated that the future generation
was not to blame for what had taken place thus far. He
believed further damage could be avoided by not taking more
to pay a one-time larger PFD. He did not support paying for
more oil tax credits at present. He highlighted there were
many other items needing funding. He hoped there would be
funds for school bond debt reimbursement. He shared that
the City and Borough of Juneau had just passed a $15
million bond to pay for three rooves on school facilities
in Juneau. He pointed out that the citizens of Juneau had
to pay for the rooves because school bond debt
reimbursement had not been received.
2:49:42 PM
GARRET ABBOTT, SELF, KETCHIKAN (via teleconference), spoke
against the bill as amended by the recently passed
amendment sponsored by Representative Rasmussen. He thought
it was outrageous the committee had decided to place oil
companies before the well-being and need of Alaskans. He
remarked that Alaska had many debts and obligations
including to education, welfare services, housing, and the
preservation of the PFD for current and future generations
at the current statutory amount. He stated that every
dollar to the oil companies came at the expense of the
other items. He thought companies owed credits should get
in line like everyone else.
2:51:52 PM
GAIL LIMBAUGH-MOORE, SELF, KENAI/SOLDOTNA (via
teleconference), spoke in support of the governor's full
PFD amount of $2,350. She stated that Representative
Carpenter's earlier amendment would have solved everyone's
problems. She believed a statutory PFD was in order. She
thanked the committee for its time.
2:52:39 PM
CHRIS EICHENLAUB, SELF, WASILLA (via teleconference),
believed the state was grossly mismanaging its resources.
He supported repealing SB 26 that had been passed against
the will of the people. He highlighted there had been an
advisory vote of the people and years of testimony telling
government to keep its hands off the PFD. He stated the
public was the police when it came to actions by the
legislature. He thought the finance committees were
corrupt. He stated the people were tired of testifying over
and over. He thought the legislature kept kicking the can
down the road. He remarked that the legislators were going
to be fired in the future.
2:55:13 PM
ROBERT HIMSCHOOT, NUSHAGAK ELECTRIC AND TELEPHONE
COOPERATIVE, DILLINGHAM (via teleconference), supported the
inclusion of the Alaska Energy Authority, Renewable Energy
Fund for round 13. He stated the project should have been
included in HB 69 but was inadvertently left out. He
explained that the action did not require any new
appropriations into the Renewable Energy Fund and merely
reflected a reallocation of resources already in the fund.
He shared that the company would use the funds to advance
the Nuyakuk hydro project, which could substantially
eliminate diesel usage in the region. The process had been
very specific about the use of the funds. The timeline had
driven the chosen studies. He stated the process had been
delayed by a delay in funding.
2:57:39 PM
TED MADSEN, SOUTHCENTRAL FOUNDATION, ANCHORAGE (via
teleconference), spoke in support of Washington, Wyoming,
Alaska, Montana, and Idaho (WWAMI) funding. He provided
detail about the program and highlighted that many of the
participants returned to Alaska to practice medicine. He
relayed that Alaska had no stand-alone medical school and
WWAMI provided the opportunity to train doctors needed by
Alaska's healthcare sector. He stressed that the state was
currently facing a dire shortage in medical professionals.
He highlighted burnout due to the pandemic. He implored the
committee to fully fund WWAMI.
2:59:56 PM
HEATHER ANTHONY, SELF, ANCHORAGE (via teleconference),
spoke on behalf of young children in Alaska. She stated
that COVID-19 had caused many people to lose their jobs.
She stressed that Alaskans needed a full PFD. She
emphasized that paying less than the full amount impacted
adults and children. She underscored that people were in
dire straits. She pled for a full PFD. She asked the
legislature to focus on the fact that everyone was
suffering.
3:03:50 PM
JOHN ERICKSON, CITY MANAGER, YAKUTAT (via teleconference),
spoke in support of community assistance recapitalization.
He detailed that the community received approximately
$200,000. He reported that a loss of the funds would mean a
10 percent decrease in the city's budget. He reported that
the city had been saving and counting pennies to redo its
harbor. He stated that everyone loved a PFD; however, the
city provided many of the services the state used to
provide such as fish and game and harbors - all sorts of
programs the city received no money for. He stated that a
$2,500 PFD was one ferry run to get a car to Anchorage.
3:06:13 PM
TERRIE HARRIS, SELF, ANCHOR POINT (via teleconference),
stated the issue was not a PFD versus service or lucrative
cash oil tax credits. She thought it was a PFD versus
wasteful spending. She did not support the legislature's
action. She would vote for a constitutional convention in
2022 and would run as a delegate. She supported a spending
cap.
3:09:01 PM
AT EASE
3:09:17 PM
RECONVENED
LAURA TANIS, ALEUTIANS EAST BOROUGH, ANCHORAGE (via
teleconference), shared information about the communities
included in the borough. Local revenue came from raw fish
tax and remaining revenue came from state and federal
sources. The borough supported a balanced approach between
the PFD and government services. She stated the governor's
proposal was not sustainable. She shared that cost-shifting
to local governments was a major concern to the borough.
She reported that the borough was currently facing a $1.9
million deficit. She requested full funding for school bond
debt reimbursement, harbor bond debt reimbursement,
community assistance, and school construction/major
maintenance. She supported a balanced budget.
3:11:38 PM
PAM LEE, SELF, EAGLE RIVER (via teleconference), wanted
everyone to honor the late Governor Jay Hammond and
everything he had worked for to put the PFD in place. She
supported a full PFD. She agreed with the idea of a
constitutional convention and wanted the legislature to be
on the road system.
3:12:20 PM
MICHAEL KRAMER, SELF, FAIRBANKS (via teleconference),
supported a full statutory PFD. He stated that residents
were owed over $13,000 from lost PFDs. He shared a personal
story. He stressed it was wrong to take money from people.
He told the legislature to straighten up and give him his
PFD.
3:14:25 PM
PAM VENTGEN, EXECUTIVE DIRECTOR, ALASKA STATE MEDICAL
ASSOCIATION, ANCHORAGE (via teleconference), spoke in
support of the WWAMI program. She detailed that graduates
provided primary care in many parts of the state. She
stressed it was a vital part of the state's healthcare
team. She asked for members' support for the program and
reinstating the reverse sweep.
3:15:21 PM
ROSE BURGESS, SELF, ANCHORAGE (via teleconference), spoke
in support of a full PFD. She shared that she could no
longer work because she was taking care of a family member
and every dime mattered. She stated that the full $2,350
would help her amidst the COVID-19 crisis. She asked the
legislature to support the bill.
3:16:29 PM
GARVIN BUCARIA, SELF, WASILLA (via teleconference), opposed
Amendment 2 and did not believe a lower PFD would be
advantageous to anyone. He supported a full PFD. He thought
it made little sense to expect a full PFD and a new state
tax. He was opposed to a state tax.
3:17:49 PM
MIKE ALEXANDER, SELF, BIG LAKE (via teleconference), wanted
$10,800 that was sitting in the Earnings Reserve Account.
He stated that the cost would be $6.8 billion for 630,000
people getting a PFD. He stated infusing the funds in the
economy would do more for the state than the legislature
had done in the past several years. He wanted to see
everyone made well for the PFDs owed. He stressed the
legislature needed to learn to cut the budget. He supported
a constitutional convention.
3:19:34 PM
BERT HOUGHTAILING, SELF, MAT-SU (via teleconference),
thought the current situation was a clown roadshow. He
thought the situation could be made better if the
legislature would work on a fiscal plan. He asked what
about all of the Alaskans who did not receive their PFD
because the funds were given to other people. He stated the
biggest economic benefit would be to give a full PFD.
3:21:54 PM
Mike Widney, Save the PFD, Mat-Su{ supported a full PFD. He
wanted the legislature to cut government services down to a
reasonable size. He did not think the legislature
understood. He thought a direct infusion to the people
would be the biggest economic boon to the state. He asked
representatives to force negotiations by playing hardball
with other legislators on the issue.
3:23:24 PM
LOY THURMAN, CHAIRMAN, REPUBLICANS OF DISTRICT 8, MAT-SU
(via teleconference), emphasized that legislators were
representatives of the people, not overlords. He stressed
that people needed money. He stated that government only
took money, it did not generate revenue. He thought the
situation was crazy. He emphasized the people needed money
immediately. He thought there would be a citizen rebellion
if the Biden administration continued its current course.
He stated that legislators were facing a judgement day. He
reiterated that the people needed the PFD money.
3:26:19 PM
KAREN CRANDALL, SELF, BIG LAKE (via teleconference), shared
she had been informed about the bill at a Republican
meeting the previous evening. She supported 50 percent of
the oil shares going directly to the people. She wanted the
full payment of the PFD. She wanted to repeal SB 26 because
she believed there was greater accountability in empowering
the people of Alaska to determine how to spend the funding.
She did not want to dip into the ERA in order to have funds
available for disaster relief or war at the state's
borders.
3:28:06 PM
JOSEPH GELDOF, ALASKA CENTER FOR CONSTITUTIONAL PROTECTION
AND ERIC FORRER, JUNEAU, spoke about the oil and gas tax
credits. He believed it was a failed program that had been
bad from the start. He stated it had not all been the
legislature's fault. He reported that former Governor Frank
Murkowski had been the leader of the program that
originated in 2003. He stated that the former governor had
been the head of a bank that imploded. He discussed when
former Governor Walker had tried to take the failed program
and borrow $1 billion, the Alaska Supreme Court had ruled
the action unconstitutional.
Mr. Geldhof asked how the legislature would finance the oil
tax credits. He asked if the legislature would take the
money out of the ERA or strip money from AIDEA. He asked if
AIDEA even had the authority to fund the program. He stated
that the tensions the legislature had to deal with to fund
the legacy credit were brutal. He underscored it was not a
debt. He directed members toward writings by supreme court
Justice Stowers for more information on the case. He stated
that the administration of the program had been fraught
since the former Walker administration. The legislature was
being asked to pay $114 million. He stated that statute was
subject to interpretation and another interpretation was
that the state owed about $37 million. He thought the bill
was on its way to die over in the Senate. He recommended
researching the issue and determining what was needed to
meet the statutory obligation. He pointed out that
statutory obligation was not binding, but aspirational.
3:32:47 PM
Representative Thompson requested Mr. Geldhof's written
testimony.
Mr. Geldof agreed.
Representative Edgmon asked for detail on the Alaska Center
for Constitutional Protection.
Mr. Geldof replied that it was associated with Eric Forrer
in Juneau. He described the organization as a loose working
group of individuals who care about the Alaska Constitution
and occasionally stepped in with comment or information. He
relayed that if the group ever litigated over a statutory
provision where there was not public interest litigant
protection, he would set up an LLC to immunize individuals
doing public interest work from the high cost and expense
the attorney general ran up whenever someone tried to deal
with a statutory provision under Alaska's court rules. He
shared that the group was largely comprised of a group of
older people who were interested in civic affairs including
Eric Forrer, Ron Swanson, and himself.
Co-Chair Foster provided the email address and call in
numbers for the public.
3:35:38 PM
KATHLEEN SHOOP, SELF, PALMER (via teleconference),
supported a full PFD. She stated that most people were
really hurting. She relayed that the economy and
opportunities could really be improved. She remarked that
special interests should not be getting all of the money.
She supported the governor's $2,350 PFD if the full PFD was
not an option. She was committed to her community and
offered help if needed.
3:36:58 PM
RAY WARD, SELF, ANCHORAGE (via teleconference), spoke in
support of the full PFD. He shared that he is poor and has
health problems and no one to care for him. He stated that
poor people and working people who had lost their jobs had
been affected the most by the COVID-19 pandemic. He shared
that he is blind, disabled, and lived alone with no one to
help him. He stated the PFD was the people's money. He
wanted federal COVID relief funding to be distributed as
stimulus checks to the people. He suggested the state
participate in the national lottery systems. He supported a
U.S. Coast Guard base in the Arctic region. He emphasized
that Alaska was the richest state in the country, but it
was the poorest developed state in the country.
3:41:04 PM
JOE MUENTEC, SELF, FAIRBANKS (via teleconference), stated
that the PFD was not broken and did not need to be fixed.
He wanted the state to give back to the people what
belonged to them. He did not support any taxes. He
supported the governor's proposal to put the PFD in the
constitution.
3:42:28 PM
AOFIA MELEISEA, SELF, ANCHORAGE (via teleconference),
supported the governor's proposal and the PFD.
3:43:13 PM
MARLENA TUFFORD, SELF, NORTH POLE (via teleconference),
stated that there should be at least a 50/50 division
between the PFD and government services placed in the
constitution. She stated that the COVID pandemic had been
challenging and unforgettable. Her children had been moved
to home school. She shared that she did not have extra food
for her children. She stated it would be a very beneficial
year for residents to receive a full PFD.
3:45:13 PM
NORIA CLARK, SELF, ANCHORAGE (via teleconference),
supported a constitutional convention. She stressed that
the PFD was not the legislature's money. She believed cuts
were needed. She thought the large amount of spending on
education combined with its low ranking was embarrassing.
She stated that taking the PFD took family's rights away to
determine how to spend their money. She highlighted the
Pick.Click.Give option for people to donate. He asked why
the state did not have any money. She supported a full PFD.
3:48:09 PM
CHARLES BLACK, SELF, ANCHORAGE (via teleconference),
supported the PFD. He shared the personal importance of the
PFD when he had been younger. He believed the PFD was very
helpful for younger people trying to get going in life. He
thought it would be a big win for many people to receive
the PFD in light of the pandemic. He was not a proponent of
paying out a lot of money to state agencies. He thought
about families that needed the money.
3:49:35 PM
KRISTIN CASH, SELF, FAIRBANKS (via teleconference), stated
her understanding that the PFD had been established to put
some funding into the hands of the people. She thought the
state's budget was very inflated. She believed the
legislature was funding numerous special interest groups.
She wondered why there were so many floundering families.
She thought the money needed to be reconstructed from the
bottom up. She stated that the PFD was intended as a
support. She did not depend on the money monthly; however,
many families she knew used the funds for school clothes.
She believed it was time to right the stealing of funds
from the people.
3:52:56 PM
MELANIE BEVERLY, SELF, SOLDOTNA (via teleconference),
supported the payment of a full PFD and payment of past
PFDs.
3:53:32 PM
BRIDGETT VAUGHN, SELF, NORTH POLE (via teleconference),
stated that the PFD had been stolen by the former Walker
administration by no vote of the people. She thought there
should be a residency requirement of at least three years
to weed out residents who did not work in Alaska year-
round. She highlighted the high cost of fuel, energy, and
food in Alaska. She thought Alaskans deserved their share.
She supported the governor's proposal of a $2,350 PFD.
3:54:46 PM
TAMARA VAN VLIET, SELF, HOMER (via teleconference),
supported a full PFD. She provided ways that she had seen
people use their dividends. She shared that her family had
depended on the PFD when their children had been young. She
provided examples of ways the PFD had helped people
including the ability to purchase clothing for kids,
schooling, fuel, and other. She supported the governor and
her representative Sarah Vance.
3:56:53 PM
EMILY KANE, SELF, JUNEAU (via teleconference), appreciated
the hard work of the legislature and the bipartisan work.
She hoped the legislature would continue to develop a
Permanent Fund formula to preserve the Permanent Fund
capital and allow for an affordable annual PFD. She
believed the change would reduce the need for endless weeks
in special sessions in order to get to an annual shared
profit amount. She believed a huge PFD was incredibly
irresponsible. She pointed out that no size of a PFD would
do the heavy lifting of public education, health, providing
for village public safety officers, bridges, police
departments, roads, and maintenance of infrastructure. She
underscored that the Pick.Click.Give program would not cut
it when it came to the huge budget items. She stressed they
could not bankrupt the state for a one-time windfall. She
stated it was necessary to look at the long-term. She did
not believe the state should dig into the Permanent Fund
irresponsibly. She believed the role of government was to
distribute funds to support social services and
infrastructure. She emphasized that individuals could not
pay for the social costs. She thought that paying for a
safety net with a sales tax was cruel and regressive. She
supported taxing higher income. She supported an income
tax.
3:59:20 PM
JOE WESTFALL, SELF, ANCHORAGE (via teleconference),
believed the people came first and the desires of lobbyists
came second. He favored a full PFD, but understood it was
likely an impossibility. He supported the governor's plan
if the first was not possible.
4:00:29 PM
TREVOR STORRS, PRESIDENT AND CEO, ALASKA CHILDREN'S TRUST,
ANCHORAGE (via teleconference), shared information about
the agency's mission. He highlighted the immediate impact
the lack of the reverse sweep had on youths, specifically
related to the Marijuana Education Treatment Fund. He
detailed that the fund was supported by 25 percent of the
state marijuana tax. He provided detail on youth programs
the funding supported. The fund was replenished by ongoing
marijuana tax revenues; however, the fund had been zeroed
out due to the sweep. He reported that the state had been
unable to advance grant funds and the agency was in the
middle of a three-year grant cycle. The situation created
fiscal uncertainty. He discussed other detriments resulting
from the situation. He shared additional services that were
impacted. He stressed in the importance of investing in the
state's youth.
4:02:47 PM
LISA HANSEN, SELF, KENAI (via teleconference), spoke in
support of a full PFD payout. She stated the funds would go
to struggling Alaskans. She shared that her husband worked
full-time at a local hospital and had not received any
bonus working through the pandemic. Her family was not on
any welfare. She urged the committee to pay a full PFD, but
if it was not doable, she supported the governor's $2,350
PFD.
4:04:30 PM
DR. TANIA HALL, WWAMI, ANCHORAGE (via teleconference),
encouraged the committee to identify a funding source for
the WWAMI program. She explained that class had begun the
previous week, but funding had not yet been secured. She
detailed that the program could not recruit for the next
year if the funds were not identified. She stated the
statistics spoke for themselves. She wished there was a way
to have statutory funding for the program because its worth
had been proven year after year.
Representative Rasmussen asked how many students or doctors
typically stayed in Alaska after completing the WWAMI
program.
Dr. Hall replied that since the establishment of the
program in 1974, more than 60 percent of WWAMI graduates
had returned to Alaska. When considering all of the WWAMI
states, students from the other participating states
rotated through Alaska and often decided to practice in
Alaska. She reported that more than 70 percent of WWAMI
graduates came to Alaska. She detailed that 14 percent of
the current physician workforce was from the WWAMI program.
The program constituted the largest contributing medical
school to Alaska's doctors. She noted that the legislature
was funding the difference between in-state and out-of-
state tuition for the WWAMI students. She clarified that
students still paid in-state tuition, which was quite
expensive. She detailed that it ended up being about a
$30,000 difference that the state generated a loan for each
student. She reported that if students did not return to
the state to practice for at least five years in an urban
area or three years in a rural area, they had to pay back
interest of 6.8 percent on all loans.
4:08:37 PM
FAITH HOWELL, SELF, FAIRBANKS (via teleconference), did not
understand how special interest groups kept begging for
funding when the PFD was supposed to go directly to the
people. She shared that she is a senior and ineligible for
other services because she received social security. She
stressed that she and her partner were raising their
grandchildren and desperately needed the PFD funding to
feed the children. She supported a full PFD or the
governor's proposal.
4:09:48 PM
CHELSE LORD, SELF, CHUGIAK (via teleconference), supported
a full PFD or the governor's proposal. She supported a
constitutional convention to put the PFD in the
constitution. she stated that the PFD was the people's
money. She believed PFD would stimulate the economy. She
supported moving the capitol to the road system. She
thought the state had taken enough money from the people.
She stated that the money needed to be given back.
4:11:41 PM
RYAN APATHY, WWAMI MEDICAL STUDENT, ANCHORAGE (via
teleconference), called in support of funds for the WWAMI
program. He shared his personal experience in the program.
He was currently completing an internship at Seattle
Children's Therapeutics through WWAMI. He had been provided
the opportunity to engage in medical research while
remaining connected to his home community of Sitka. He
stated that without state funding, the talent and
intelligence he saw in his classmates was in danger of
being diluted throughout the country instead of being
condensed and cultivated at home. He urged passage and
identification of a stable funding source.
4:13:55 PM
COLLEEN VAN VLEET, SELF, ANCHORAGE (via teleconference),
spoke in support of the governor's PFD proposal. She stated
it would be nice if the public received backpay for PFDs
reduced in recent years. She reported that the partial PFDs
were not cutting it. She provided information about her
personal experience. She supported putting the PFD in the
constitution.
4:15:33 PM
ALEX MCDONALD, SELF, FAIRBANKS (via teleconference), stated
that the legislature had taken billions out of the economy
in recent years due to PFD cuts. He shared that he was a
small business owner. He supported a full PFD. He stressed
that paying the PFD would help the state, private sector,
and the economy. He highlighted the high cost of fuel. He
cited a statement by the late governor Jay Hammond that it
was not the state's job to pick winners and losers. He
stated that the PFD evened the playing field. He thought
the legislature should be maximizing the benefits for all
residents, not special interests. He supported a statutory
PFD and backpay if possible. He highlighted federal COVID
funds and noted the Permanent Fund made record returns in
the current year.
4:18:04 PM
ABBY ST. CLAIR, SELF, WASILLA (via teleconference),
supported the governor's PFD plan. She asked the
legislature to pay a statutory PFD or the governor's
proposal. She remarked that residents were continuing to
experience financial challenges resulting from the COVID
pandemic. She stated that paying a full PFD would boost the
state's economy and help Alaskans.
4:19:05 PM
SANDI BATESON, SELF, PALMER (via teleconference), spoke in
support the governor's PFD proposal. She shared that she
had been an essential worker and her husband was working
multiple jobs. She had been hit with a serious medical
issue and could not work at present. She stated that
residents needed their full PFD.
4:20:20 PM
MAX KULLBERG, SELF, ANCHORAGE (via teleconference),
testified in support of funding for the WWAMI program. He
provided the benefits of the program. He shared that the
program had the fourth highest retention rate of any
medical school in the country. He relayed almost 60 doctors
returned to work in Alaska for every 80 trained. He stated
that if the program was not funded, the medical program
could end in the state. He thanked the governor for
recently introducing WWAMI, the Alaska Performance
Scholarship, and the Alaska Education Grant into the
current legislative special session. He urged support of
the programs.
4:22:02 PM
KIM WISE, SELF, ANCHORAGE (via teleconference), supported
the governor's proposal. She shared that she had worked as
a tour guide for many years in Alaska. She was often asked
about the PFD program. She was a single parent of a special
needs child and spent her PFD on programs not covered by
medical care for her child. She added that the pandemic had
also impacted her family. She was in full support of the
PFD.
4:23:26 PM
JAMES PHILLIPS, SELF/NORTHERN CREDIT SERVICES, KETCHIKAN
(via teleconference), spoke in support of the PFD. He
shared that the entity dealt with thousands of people daily
who survived due to the PFD. The PFD helped Alaskans with
fuel, food, and other. He asked the legislature to help the
governor with his efforts.
4:24:31 PM
DR. THOMAS QUIMBY, ALASKA CHAPTER OF AMERICAN COLLEGE OF
EMERGENCY PHYSICIANS, PALMER (via teleconference),
testified in support of full funding for the WWAMI program.
He shared that he was a WWAMI graduate. He spoke to the
benefits of the program. He provided a story about a
patient who benefitted from the program. He stated that
loss of the program would mean Alaska would be the only
state in the U.S. without a medical school or affiliation
with a medical school for instate students.
4:26:58 PM
SABRINA WOODY, SELF, ANCHORAGE (via teleconference), shared
that she spent her PFD on her daughter's clothes, winter
supplies, and future education. She thought it was a slap
in the face to hear the PFD may only be $500. She supported
the governor's proposed $2,350 PFD. She highlighted the
increasing cost of goods and services in the state.
4:28:08 PM
AT EASE
4:28:30 PM
RECONVENED
Ms. Woody continued her testimony. She provided details
about the expense of items in the state. She listed items
she sued the funding for. Many families had been hurt
drastically by COVID. She stated that the PFD would help
people get back on their feet. She hoped the legislature
would consider what the money could do to help the people
and economy.
4:30:17 PM
KATHRYNE MITCHELL, WWAMI, FAIRBANKS (via teleconference),
spoke in support of WWAMI and its funding. She thanked the
governor for adding the program to the special session. She
thanked legislators for their continued support of the
program. She shared personal details about her education
experience. She was enrolled in the program and was working
toward becoming a physician to work in rural Alaska. She
spoke to the need for medical professionals to understand
patients in Alaska.
4:32:34 PM
SHEILA SCHATZ, SELF, WASILLA (via teleconference), spoke in
support of the $13,000 in PFD funds that had been taken
from residents. She stated that the continual theft of the
people's PFDs was unacceptable. She highlighted the
Permanent Fund's high earnings. She found a $2,300 PFD
unacceptable. She stated that Alaskans were owed backpay.
She stated that what she did with her PFD was none of the
legislature's concern. She wanted an audit. She wanted her
full $13,000.
4:34:23 PM
TIMOTHY WILSON, SELF, WASILLA (via teleconference), spoke
in support of the governor's PFD plan in addition to a
statutory and constitutionally protected PFD. He thought
the elected leaders were interested in their own
pocketbooks. He was tired of watching what looked like
wasteful spending and the state's money going to personal
interests and campaign donors. He did not see how the state
could have a budget problem when there had not been one
when former Governor Walker took office. He believed the
reduction of the PFD was criminal.
4:35:41 PM
MIKE COONS, SELF, PALMER (via teleconference), testified in
support of the governor's plan. He stated that the people
voted for continuing SB 21. He believed the legislature had
violated the law for several years. He supported the
governor's vetoes. He did not believe the House was
compromising on the budget. He supported the governor's
constitutional amendments SJR 6 and SJR 5. He was unhappy
with the lower PFD number but would support the governor's
efforts. He stated that the majority did not listen to the
recommendations of the fiscal policy working group. He
supported a revised constitution.
4:37:42 PM
KURT SCHMIT, SELF, DELTA JUNCTION (via teleconference),
testified in support of HB 3003 and the full statutory PFD.
He supported former Governor Hammond's role in the
statutory PFD. He stated that 100 percent of Alaska
students were impacted by the PFD payout. He detailed that
many of the students put the money in savings for
education. He asked what was more important, established
successful students in the WWAMI program or the young
students in Alaska. He found it ironic the people were
squabbling over who should get the PFD money - special
interests or the people. He supported following Hammond's
plan regarding distribution of economic resources.
4:40:01 PM
DANIELLE HENSON, SELF, WASILLA (via teleconference), spoke
in support of a full PFD that would allow residents to put
more money back into the economy. She stated it would allow
people to buy locally and would help many families out for
winter. She shared personal detail about her family's
experience. She thought it would hurt many Alaskans if they
did not get the money that was rightfully theirs.
4:42:07 PM
DR. HERB SCHROEDER, UNIVERSITY OF ALASKA - ANCHORAGE, EAGLE
RIVER (via teleconference), supported full funding for the
WWAMI program. He shared that 25 percent (40 students) of
his incoming students wanted to by physicians. He
elaborated that the best place for the students to attend
medical school was through WWAMI.
4:42:59 PM
ROBERT GRESHAM, SELF, NORTH POLE (via teleconference),
urged the legislature to pass the governor's proposed PFD
plan. He shared that as a disabled veteran who was unable
to work, the issue was very important to him. He stated
that the PFD had never been intended as a stopgap payment,
but it seemed to have become that in the past few years. He
stressed the people's need for a full PFD. He pointed to
high gas and fuel prices. He believed the people should
have an opportunity to vote on the measure. He asked for a
full PFD or the governor's proposal.
4:44:38 PM
ALICIA ASTLUND, SELF, WASILLA (via teleconference),
supported the bill as part of the comprehensive fiscal
solution.
Co-Chair Merrick noted they would come back to Ms. Astlund
[due to a poor connection].
4:46:24 PM
RACHEL ALLEN, SELF, WASILLA (via teleconference), stated
that some of the legislators had been on their phones
during public testimony and did not appear to be listening.
She elaborated that it appeared members did not care and
were uninterested in the testimony. She stated that the
legislature needed to quit stealing the people's money and
give back the PFD. She supported getting rid of electronic
voting machines that she believed had enabled legislators
to cheat and stay in power. She stated there was a storm
coming and judgement from God. She supported a full PFD.
4:48:06 PM
PAUL HARTLEY, SELF, KENAI (via teleconference), supported a
full PFD payout or the governor's plan. He thought he had
heard only one testifier who was not in support of a full
PFD or the governor's plan. He asked if the legislators
were listening to the people. He asked legislators to
consider the need of the Alaskan people they served.
4:49:02 PM
ALICIA ASTLUND, SELF, WASILLA (via teleconference),
returned to her testimony. She was in full support of HB
3003 and wanted a comprehensive fiscal solution to the
problems facing the state. She noted the hesitancy of
legislators to put forth a constitutional amendment to the
vote of the people. She cited examples. She wanted a
comprehensive fiscal solution that would contain
constitutional amendments. She thought it was very
important for Alaskan people to have a say in government
and in how the money was spent. She was concerned that the
Constitutional Budget Reserve had been spent down.
4:51:34 PM
BENJAMIN ULAN, SELF, FAIRBANKS (via teleconference), spoke
in favor of a full PFD and backpay for past PFDs. He needed
the PFD money. He shared that he was a single father of
three children. He stated a full PFD would boost the
economy. He remarked there were other ways to get money to
special interest groups than taking it directly out of the
pockets of the people. He supported Governor Dunleavy's
plan as an alternative. He also wanted the PFD placed in
the constitution.
4:53:21 PM
JIM AYERS, SELF, JUNEAU (via teleconference), was saddened
to hear testimony on the struggles people were having. He
highlighted that some of the recommendations had been to
look at COVID funds that may accommodate some of the people
including veterans who had testified that winter was
coming, and they may not have services. He was very
concerned about HB 3003 and taking $1.4 billion to $1.5
billion from the ERA. He stressed that it blew the
opportunity to maintain the funds. He detailed that
maintaining the funds gave the opportunity to earn more
than $100 million per year for the state and future
generations. He found it disappointing to hear that some
legislators believed splurging and sending out big checks
would solve the problems. He underscored that no one was
guaranteed a free lunch in the constitution. He was a God
fearing soul and veteran and stated that Alaska was built
on hard work and people contributing. He emphasized that
the roads, schools, education, and public safety provided
the fundamental foundation of the state's system. He
thought the AMHS was being dismantled along with the
University of Alaska. He stressed that services were
imperative. He pointed out there were not enough services
out there to cut in order to mail out checks. He shared
that Bishop Kenny had shared that his one fear about the
PFD was that one day Alaskans would turn against Alaskans
to dismantle what others may need simply to get more in
their check.
4:55:46 PM
SANA EFIRD, EXECUTIVE DIRECTOR, ALASKA COMMISSION ON
POSTSECONDARY EDUCATION, JUNEAU (via teleconference), asked
the committee to act quickly to resolve funding for the
Alaska Performance Scholarship, the Alaska Education Grant,
and WWAMI. She shared that in the current enacted budget,
the programs were funded via the Higher Education
Investment Fund, which was currently unfunded. She
elaborated that HB 3003 included a fund source switch of
UGF, which would allow award disbursement to students
attending classes in the fall. She explained that without
some resolution, there was currently no funding for the
aforementioned programs. She stressed it would be an
impediment to economic recovery for Alaska. The University
of Alaska had agreed to honor the Alaska Performance
Scholarships and education grants for students attending
the university in the fall; however, there were 850
students attending other Alaska institutions who were
awaiting confirmation of their awards. Additionally, 80
WWAMI students were facing an additional $30,000 each of
out-of-state tuition. She spoke to the mission of the
agency. She requested a quick resolution to the issue.
4:58:28 PM
VANESSA WITT, SELF, FAIRBANKS (via teleconference), spoke
in support of a full PFD and payback of past PFDs. She
believed the law needed to be upheld. She noted current
financial hardships people were experiencing. She believed
the governor's plan was a good compromise. She asked the
legislature to do what was right by residents. She also
supported education grants, scholarships, and WWAMI. She
did not support any new taxes.
4:59:13 PM
BITTNER BROOKS, SELF, FAIRBANKS (via teleconference), spoke
in support of a full PFD and a curb in spending. He
underscored that the PFD was a royalty check. He provided
the definition of royalty. He wanted to see the budget
fixed and wanted to see the people get all of their money.
He thought without fixing the fiscal issues of the state
the legislature would ultimately spend more money. He
advocated fixing the budget with cuts. He wanted a full PFD
and no state taxes. He supported the WWAMI program but
supported Alaskan families first.
5:01:18 PM
JENNIFER GRAHAM, SELF, ANCHORAGE (via teleconference),
asked for a full PFD, no tax, and reduced government. She
remarked that Alaska was number one in the country for
government versus private sector. She only supported a
$2,350 PFD with a companion constitutional amendment. She
was hearing there may be amendments to reduce the statutory
PFD to $1,100. She spoke to the dire state many individuals
were in. She thought government should be at a minimal
size. She also thought the University of Alaska needed to
stand on its own financial footing.
5:03:40 PM
CONNIE OWEN, SELF, WASILLA (via teleconference), spoke in
favor of a full PFD and backpay of past PFDs. She supported
putting the money back in the people's pockets. She wanted
the capital to move to the road system. She stated it was
time for the legislature to listen to the people or voters
would put people in who would listen. She spoke against
voting machines, which she believed were destroying the
public's vote.
5:04:39 PM
ESTHER REEM, SELF, PALMER (via teleconference), spoke in
favor of a full PFD. She felt the money was stolen from the
people of Alaska by lawmakers. She stressed the high rate
of inflation on fuel and goods. She thought the legislators
owed each Alaskan a minimum of $13,000. She supported the
governor's $2,350 PFD as an alternative.
5:06:00 PM
KAYLEE EVANS, SELF, FAIRBANKS (via teleconference), called
in favor of a full PFD. She noted the high cost of living
in Alaska. She shared that her grandparents had to move
because their retirements were not sufficient for them to
stay in Alaska. She spoke of the economic challenges
inflamed by COVID. She highlighted that backpay of the PFD
would be life-changing for some people in the state. She
thought the state had stolen the people's money.
5:08:20 PM
JULIAN HINER, SELF, KODIAK (via teleconference), did not
support a state tax. He thought the legislature needed to
learn to spend less. He supported a full PFD and Governor
Dunleavy's plan as an alternative.
5:08:59 PM
JODIE MITCHELL, CEO, INSIDE PASSAGE ELECTRIC COOPERATIVE,
JUNEAU (via teleconference), called to urge members to move
the renewable energy fund grants forward. She listed
communities served by the cooperative. She shared that the
previous fall the renewable energy fund grants had been
prioritized by the Alaska Energy Authority (AEA). She
reported that the funds were already allocated to AEA and
only needed to be appropriated. She noted that somehow the
issue had fallen through the cracks. She mentioned a number
of projects that the funding affected. The funds needed to
be appropriated sooner rather than later. She believed
there were 11 projects statewide waiting for the money to
be released. She thanked the committee.
5:12:21 PM
AT EASE
5:13:03 PM
RECONVENED
SEAN LOUG, SELF, FAIRBANKS (via teleconference), advocated
for a full PFD. He stated that the overwhelming majority of
Alaskans wanted nothing less than what they were owed. He
believed anything less was theft. He stressed that the
situation impacted the impoverished much more than anyone
else in society. He indicated that many families relied on
the PFD for clothing and heat. He stated that taking away
any portion of the PFD took money out of the mouths of
children. He remarked that the country was blessed with a
great amount of income and the poorest individuals should
not suffer. He understood it took money to run government.
He believed it was necessary to pinch spending as much as
possible. He suggested that if a tax was necessary, it
should not impact the poorest and middle class
disproportionately. He mentioned a sales tax that did not
include groceries. He had lived in a state in the past that
had tax free weekends. He believed the fairest system would
be an income tax. He supported a full PFD and the
governor's plan as an alternative.
5:15:41 PM
MATHEW MAIXNER, SELF, JUNEAU (via teleconference), thought
taxation was theft. He stated that every PFD reduction was
essentially like a personal income tax. He remarked that
Alaska had the highest corporate income tax in the country.
He suggested if the rate was lowered it would bring in
business and more income for the state coffers. He thought
the legislative body was lazy during special sessions. He
wanted the legislature to listen to the people of Alaska.
He highlighted that most callers supported a full PFD,
himself included.
Representative Wool referenced the caller's statement that
other businesses put money into state coffers. He
understood how oil put money in the state coffers. He asked
how other businesses put money into state coffers.
Mr. Maixner replied that there were companies that wanted
to do business in Alaska but because the state had the
highest corporate income tax in the nation it prevented
businesses from coming. He stated that taking taxes from
corporations stole from people who could get jobs.
5:19:07 PM
DAVID NEES, SELF, ANCHORAGE (via teleconference), spoke in
support of the $2,350 PFD. He was opposed to funding for
the WWAMI program. He discussed the historical size of the
program. He did not understand why doctors were not
sponsoring WWAMI students or other. His biggest concern was
that 40 percent of the FY 22 budget was made up of earnings
from the Permanent Fund. He stressed that the people had
the ultimate political power according to the constitution.
He was supportive of the PFD portion of HB 3003 only.
Representative Rasmussen had heard numerous people say that
doctors should support the WWAMI program. She was curious
if Mr. Nees or his family members ever used doctors. She
thought doctors were vital to the public health of the
state. She believed governments should help ensure people
were healthy.
Mr. Nees stated that 80 percent of medical doctors came out
of the military program. He thought those were the
individuals the government should be helping with college
debt, instead of the state trying to grow its own doctors.
He stated that 114 doctors in the state from the WWAMI
program meant 86 percent of the doctors in Alaska were from
another source.
5:22:07 PM
KAITLYN LOGUE, SELF, FAIRBANKS (via teleconference), called
in support of a full PFD payout or the governor's $2,350
proposal as an alternative. She thought it was necessary to
cut government if the state could not afford to pay a full
PFD. She potentially supported a luxury sales tax. She
stressed that people were hurting. She implored the
committee to provide the funding to help the people. She
asked the committee to do the right thing.
5:24:06 PM
MICHAEL WALKER, SELF, STERLING (via teleconference), shared
information about his personal background. He spoke to the
original intent behind the PFD. He stated it was a fund for
all Alaskans to share. He supported the governor's proposed
$2,350 and putting the 50/50 split in the constitution in
the future. He asked the legislators to be true to the
people who provided their paychecks.
5:25:18 PM
MICHELLE BARNES, SELF, SOLDOTNA (via teleconference),
discussed the reason behind the repeal of a state income
tax in the past. She spoke to the original purpose of the
PFD. She stated that the PFD had put thousands of dollars
into the hands of the people over the years. She believed
the legislature had wasted state funds on various things
including port projects, salaries, and per diem payments.
She supported the payment of a full PFD and backpay for
reduced PFDs at a total of $13,000 per person. She
supported the governor's 50/50 plan. She wanted placing the
PFD in the constitution to be put on the ballot.
5:28:07 PM
JORDAN WOODS, SELF, ANCHORAGE (via teleconference), shared
that he had worked in Prudhoe Bay for 15 years and had been
released from Hilcorp. He hoped residents got their fair
share.
5:28:59 PM
PAUL D. KENDALL, SELF, ANCHORAGE (via teleconference),
spoke about a park in Anchorage. He did not care where
individuals stood on issues like the PFD, the vaccine, and
masking, he wanted to gather to form another type of
government. He thought someone had stolen up to $8 billion
that had been directed to the Public Employees' Retirement
System (PERS). He stated that testifiers could use whatever
language they chose.
5:31:20 PM
TAMMY SCHMIDT, SELF, WASILLA (via teleconference),
supported the governor's PFD proposal and wanted to see a
return to the plan established by former Governor Jay
Hammond. She stated that the PFD was intended to support
individuals, not special interest groups. She supported
backpay of the PFDs reduced in the past.
5:32:45 PM
JUDI BARTLETT, SELF, SOLDOTNA (via teleconference), asked
legislators to fulfill their oath of office. She stated
that constituents were offended that the legislature did
not listen to the public regarding the PFD. She wanted the
PFD in the constitution to avoid the annual situation.
5:33:45 PM
CHRISTINA HANSEN, SELF, FAIRBANKS (via teleconference),
supported the full PFD. She was disheartened by the
legislature's treatment of the PFD. She supported the
governor's proposal if the full PFD did not pass.
5:35:29 PM
LEONARD CUSTIS, SELF, HOUSTON (via teleconference), called
on behalf of himself and his wife. They supported the full
PFD and backpay of PFDs. He supported the governor's plan
but did not believe it went far enough. He supported
putting the PFD in the constitution. He thanked the other
callers and the committee for taking testimony.
5:36:39 PM
LOUIS IMBRIANI, SELF, EAGLE RIVER (via teleconference),
stated the legislature should not have the ability to pick
and choose which laws to follow. He asked where the
authority lay within the legislature to determine the
amount of the PFD. He stated that citizens did not have the
ability to pick and choose which laws to follow, and
neither should the legislature. He stated that the
legislature had the authority to make a change to the law.
He urged the legislature to find a statutory solution that
worked for Alaskans and the economy. He asked legislators
to follow the law or change it.
5:38:54 PM
DIANA CHADWELL, SELF, DELTA JUNCTION (via teleconference),
shared that she had become paralyzed in her late 30s and
unable to do her work. She supported repaying every Alaskan
the PFDs that had not been paid in full, which she
estimated to be around $15,000 per person. She supported
UAF and shared personal information about her education.
She spoke to the extremely high cost of living in Delta
Junction. She only supported the governor's PFD plan in
lieu of receiving all of the past owed PFD funds. She
wanted the capital to move.
5:41:37 PM
KAREN PERRY, SELF, CHUGIAK (via teleconference), she
supported a full statutory PFD. She believed SB 26 was an
attempt to bypass the traditional statutory PFD
distribution formula. She supported the repeal of SB 26.
She stated that PFDs that did not follow statute equated to
theft. She did not support putting the payment of oil tax
credits ahead of the PFD. She stated that the PFD would
help people pay for fuel and education.
5:44:16 PM
CHRIS DRAPER, SELF, ALEXANDER CREEK (via teleconference),
thought that legislators should all be fired. He stated
that the legislature was letting the public down. He
stressed that the PFD belonged to the people. He directed
the legislature to give the money back.
5:45:18 PM
ROBERT JEWETT, SELF, WASILLA (via teleconference), spoke in
support of a full PFD. He shared information about his life
in Alaska. He recalled former Governor Hammond saying that
the funds would always be for the people. The PFD had help
him accomplish goals in the past. He emphasized there was
nothing the state could do to benefit all Alaskans beyond
what the PFD could do for people. He supported a full
statutory PFD or the $2,350 proposed by the governor.
5:47:22 PM
LISA JOHN, SELF, FAIRBANKS (via teleconference), stated
that there were many people in villages who relied on
fishing and hunting. She pointed out there were many people
who did not get their fish in the current year. She stated
that the number of fish caught was not enough to make it
through the winter. She stated that villages had relied on
the PFD annually since their hunting and subsistence rights
had been taken. She wondered if the legislators had ever
had to choose between food or fuel for their families. She
emphasized there were families having to make the choices.
She stressed that the legislature needed to stop taking the
people's money.
5:49:28 PM
DUANE EVERTSON, SELF, BIG LAKE (via teleconference), shared
that he was a Vietnam veteran and had lived in the state
since the early 1990s. He discussed that the Permanent Fund
had been established in two parts - for the government and
the people. He stated that the government's portion had
been squandered away. He stressed the money belonged to the
people. He believed the government needed to be cut by 20
percent. He stated the legislature could balance the budget
by obeying its bosses, the public. He supported the
legislature meeting in Anchorage instead of flying to
Juneau.
5:51:44 PM
DEBORAH PARK, SELF, ANCHORAGE (via teleconference), stated
that the PFD needed to be fully paid out to all Alaska
residents. She stated that as long as there was money in
the Permanent Fund the ever-growing special interest
government would be after it. In the meantime, she
supported the governor's PFD plan. She stressed the PFD was
created for Alaskans and not for paying for government.
5:52:53 PM
JAN-MARIE BEARFIELD, SELF, JUNEAU (via teleconference),
spoke in support of a full PFD. She believed the
legislature had stolen money from the people. She shared
that she was currently unemployed due to health reasons.
She was working to get back on her feet working. Due to
COVID she was unable to get back to work currently. She
stressed that legislators needed to do their jobs. She
stated the legislature had taken money from the Permanent
Fund year after year. She underscored legislators were
spending money that was not theirs to spend.
5:55:14 PM
RENN NELSON, SELF, CRAIG (via teleconference), referenced
testimony that people wanted legislators to be audited. He
supported a statutory PFD. He liked the governor's
willingness to try to reach a compromise on the PFD;
however, he believed in the payment of a full PFD. He
suggested ways to increase revenue. He supported shrinking
government. He thought the legislature had enough time to
take care of the problems facing the state.
Representative Rasmussen asked what should be audited
related to the legislature and lobbyists.
Mr. Nelson answered he wanted an audit to know whether the
legislature was following laws. He wondered why he should
have to follow the law if the legislature did not have to.
He believed that the PFD statute should be followed. He was
concerned about a Mount Polly disaster in Canada related to
mining. He stated that levies had failed. He stated they
were talking about a similar project near Ketchikan. He
supported mines, but he did not want the streams to be
polluted if mines failed.
5:59:13 PM
JAMES SQUYRES, SELF, DELTANA (via teleconference),
supported the statutory PFD. He asked how much of the
testimony would be twisted and spun into support for the
governor's proposed amount. He believed the legislature was
severely disjointed from the people. He supported the
repeal of SB 26. He supported the governor's bill HB 3002.
He highlighted that inflation proofing of the Permanent
Fund had been prepaid for numerous years. He stated a
percent of market value (POMV) was not income, but a
number. He wanted the bill to be amended to pay a full
statutory PFD.
6:01:16 PM
ANITA SAMUEL, WWAMI, ANCHORAGE (via teleconference),
supported the WWAMI program and a funding source for the
program. She shared that she was currently a medical
student in the WWAMI program. She discussed that the
program brought Alaskans back to Alaska to practice
medicine. She spoke to the high cost of medical school even
when only paying instate tuition. She stressed the state
could not afford to have a brain drain of doctors. She
spoke to the benefits of the program. She shared that the
program trained 20 Alaskan doctors per year and ensured
they would come back to Alaska or pay part of the state's
investment. She shared that Alaska was underserved in the
healthcare sector. She relayed that the WWAMI was a program
by Alaskans, for Alaskans, to serve Alaskans. She thanked
the governor for including it in the budget and asked the
legislature to approve a funding source.
6:03:23 PM
TERRY VANLEUVEN, SELF, JUNEAU (via teleconference), shared
that he loved Alaska and shared information about his life.
He supported the governor's proposal. He shared that the
people he had spoken with were happy with the proposed
$2,350.
6:04:12 PM
MANOLI MALAMUTE, SELF, FAIRBANKS (via teleconference),
supported the full PFD with backpay or the governor's
proposal as an alternative.
6:04:51 PM
BRIAN VANDERWOOD, SELF, ANCHORAGE (via teleconference),
supported the restoration of the PFD to its full statutory
formula. He thought anything else would be criminal. He
stated there was nothing that could replace the voice of
the people. He remarked that the legislature's job was to
act in the best interest of the people. He highlighted that
the people of Alaska had spoken. He discussed that former
Governor Hammond had put together a program that had been
sustainable for many years. He believed it had been
sabotaged by the former Walker administration. He supported
the current governor's efforts; however, there was a debt
due to the people that needed to be paid in full. He shared
information about his family.
6:07:14 PM
DWIGHT LANE, SELF, NORTH POLE (via teleconference), shared
that he is a disabled veteran. He supported the governor
and everything he did. He wanted the capital to be on the
road system.
Co-Chair Merrick provided the email address for written
testimony.
6:08:38 PM
AT EASE
6:23:28 PM
RECONVENED
Co-Chair Foster returned to the amendment process.
6:23:56 PM
Representative Wool MOVED to ADOPT Amendment 2, 32-
GH3353\A.2 (Marx, 8/20/21) (copy on file):
Page 1, line 3:
Delete "from the earnings reserve account"
Page 1, lines 4 - 5:
Delete "budget reserve fund"
Insert "constitutional budget reserve fund (art. IX,
sec. 17, Constitution of the State of Alaska)"
Page 5, lines 1 - 4:
Delete all material and insert:
"* Sec. 4. ALASKA PERMANENT FUND. The sum of
$730,500,000 is appropriated to the dividend fund (AS
43.23.045(a)) for the payment of a permanent fund
dividend in the amount of approximately $1,100 to each
eligible individual and for administrative and
associated costs for the fiscal year ending June 30,
2022, from the following sources:
(1) $400,500,000 from the general fund;
(2) $330,000,000 from the budget reserve fund (AS
37.05.540(a))."
Page 5, line 8:
Delete "APPROPRIATION"
Insert "APPROPRIATIONS"
Page 5, line 9:
Delete "a fund"
Insert "funds"
Co-Chair Foster OBJECTED for discussion.
Representative Wool explained the amendment lowered the
amount of the PFD to $1,100 paid from general funds and the
SBR. He noted the proposal was similar to what had been
adopted by the conference committee and passed by the House
and Senate. He elaborated that the amendment would use $330
million from the SBR (surplus from FY 21) and $400.5
million from the General Fund from FY 22. The total
combined amount of approximately $730.5 million equated to
a PFD of about $1,100 per person. He explained that the
governor had vetoed the amount passed by the legislature
and the amendment would return to the amount the
legislature had originally passed. He highlighted that the
proposal would not require an overdraw of the ERA and would
not require any additional funds. He stated that the 5
percent draw from the ERA was kept intact.
6:25:56 PM
Representative Thompson asked if the $330 million was from
the SBR.
Representative Wool replied in the affirmative. He
explained that the amendment used the SBR because recent
court decisions had determined the SBR was not a sweepable
fund. He detailed that the SBR did not require a three-
quarter vote and would be a safe way to pay for the PFD.
6:26:41 PM
Representative Josephson would be supporting the amendment.
He did not believe there had ever been a court declaration
that addressed the SBR. He stated that about two weeks
back, superior court judge Garten listed a series of funds
outside the General Fund including the SBR (AS 37.05.540).
He read from the statute: "there is established as a
separate fund in the state treasury, the budget reserve
fund." He noted that the administration had the right and
wherewithal to appeal the decision. He highlighted that the
case had not been about the SBR (as the legislature had
heard from its attorneys). He stated that although the
superior court ruling was not binding, it was another
issue. He elaborated that an attorney would typically cite
to footnote 77 in support of the seeming likelihood that
the SBR was not sweepable. He believed the funds were
available. He noted that the committee had just heard from
about 100 Alaskans. He pointed out that the delegation in
the legislature of those who had testified did a great job
representing their constituents. He stated there were
people who did not agree with the position who had not
called in. He remarked that SB 26 was a conservative policy
of spending prudently. He noted that the draw remained 5
percent even if returns were negative or 1 percent. He
argued that under a method of overdrawing one year, there
should be an under-draw in bad years. He asked how to plan
around that method. He supported the amendment.
Representative Wool commented on the calls from testifiers
in relation to PFD amounts. He pointed out that
coincidentally the average PFD over the last 40 years was
$1,100. He highlighted that the PFD had ranged between $900
and $1,300 between 2000 and 2015 (before the statute had
not been followed). He detailed that the highest PFD ever
paid was in 2015 for $2,072 and the first time it had
exceeded $2,000 was in 2008 when there had been a
supplemental check due to high oil and heating prices. He
stated that the PFD had never come close to $3,000.
Representative Johnson OBJECTED.
A roll call vote was taken on the motion.
IN FAVOR: LeBon, Ortiz, Thompson, Wool, Edgmon, Josephson,
Merrick
OPPOSED: Rasmussen, Carpenter, Johnson, Foster
The MOTION to ADOPT Amendment 2 PASSED (7/4). There being
NO further OBJECTION, Amendment 2 was ADOPTED.
6:32:31 PM
Vice-Chair Ortiz MOVED to ADOPT Amendment 3, 32-GH3353\A.1
(Marx, 8/20/21) (copy on file):
Page 1, lines 4- 5:
Delete "making an appropriation from the earnings
reserve account to the budget reserve fund;"
Page 5, line 1:
Delete "(a)"
Page 5, lines 5 - 11:
Delete all material and insert:
"* Sec. 5. LAPSE OF APPROPRIATION. The appropriation
made in sec. 4 of this Act is for the capitalization
of a fund and does not lapse.
* Sec. 6. RETROACTIVITY. The appropriation made in
sec. 4 of this Act is retroactive to July 1, 2021."
Representative Carpenter OBJECTED.
Vice-Chair Ortiz explained that with the passage of
Amendment 2, Amendment 3 would remove the $3 billion
appropriation to the CBR that would have acted as bridge
money necessary to pay out a larger PFD. He explained that
the appropriation and an overdraw were no longer necessary
as a result of Amendment 2. He detailed that it meant the
state did not need to forgo $180 million in lost earnings
by making the $3 billion from the ERA.
Representative Carpenter did not think the previous
amendment and the current amendment would stand on the
House Floor. He thought they were a waste of the
committee's time.
Representative Wool he noted there was some cleanup
language in Amendment 2 due to a recommendation by
Legislative Legal Services. He informed members that the
passage of Amendment 3 would delete the language that
referenced the CBR.
Representative Carpenter MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Ortiz, Thompson, Wool, Edgmon, Josephson, LeBon,
Rasmussen, Merrick, Foster
OPPOSED: Carpenter, Johnson
The MOTION to ADOPT Amendment 3 PASSED (9/2). There being
NO further OBJECTION, Amendment 3 was ADOPTED.
6:35:43 PM
Co-Chair Merrick MOVED to ADOPT Amendment 4 (copy on file):
DEPARTMENT: Commerce Community and Economic
Development
APPROPRIATION: Community and Regional Affairs
ALLOCATION: Community and Regional Affairs
ADD: $400,000 UGF(1004) to grants line
EXPLANATION: Restore General Fund Subsidy to Alaska
Legal Services
Co-Chair Foster OBJECTED for discussion.
Co-Chair Merrick explained that the amendment would restore
$400,000 the governor had vetoed from the Alaska Legal
Services Corporation (ALSC). She detailed that ALSC had
been providing free civil legal aid to Alaskans in need
since 1967. The corporation had 12 offices throughout
Alaska and had provided legal aid to over 7,000 Alaskans in
205 communities the previous year. She elaborated that ALSC
was the largest and often the only provider of civil legal
help to survivors of domestic violence, crime victims,
seniors, veterans, and many others struggling in difficult
times. The effectiveness and efficiency of the services
provided was well documented and the community demand for
help was overwhelming. She highlighted ALSC's 86 percent
success rate and a recent study showing that for every $1
invested in ALSC it saved state and local governments $5.
Co-Chair Merrick stated that Alaska led the country in
domestic violence and sexual assault per capita. She
expounded that in FY 20, ALSC provided help to over 900
survivors of domestic violence and sexual assault. She
relayed that decade's worth of studies had found that
providing civil legal help to domestic violence survivors
was the most effective intervention. She explained that it
could help get protective orders against abusers, help with
family custody matters, and secure other resources to meet
basic needs. She reported that the veto of $400,000
represented a cut of 62 percent of ALSC's state
appropriation, reducing state support to its lowest point
since 2010. She stated the action appeared to be an
inadvertent error caused by confusion. She explained that
the administration had thought the vetoed funds were an
increase; however, the amount merely reflected flat funding
from the previous year. She stressed that ALSC had turned
away nearly 250 people in need of legal assistance in July
alone in preparation for the vetoed funding. The amendment
would restore longstanding funding, returning state support
to its status quo. The funding would enable the corporation
to serve Alaskans desperately in need of help. She
underscored that without the funding, Alaskans would have
no where else to turn.
6:38:11 PM
AT EASE
6:49:15 PM
RECONVENED
Representative Josephson spoke in favor of the amendment.
He thanked Co-Chair Merrick for offering the amendment. He
indicated that in law school he had been an intern for
Pennsylvania Legal Services. He shared detail about the
experience. He relayed that as a trial lawyer he had
opposed Legal Services attorneys and had been very
impressed by their work. He found the vetoed funding for
Alaska Legal Services as symbolic of all of the other
vetoes and swept items that the legislature had identified
as imperative six to eight weeks earlier.
Representative Edgmon spoke of support of the amendment and
the program. He had seen the benefits of Alaska Legal
Services, as there was an office in Dillingham. He shared
that he chaired the budget subcommittee that oversaw ALSC
and had been an advocate of the program for many years. He
characterized the office as the "little engine that could."
He stressed that the corporation attracted a substantial
amount of funding for every dollar of state support, in
addition to volunteer time and federal resources. He
strongly supported the funding and thanked Co-Chair Merrick
for introducing the amendment. He lauded Nicole Nelson who
lobbied on her own and did a great job.
6:52:44 PM
Representative Carpenter thought it was a great
juxtaposition of state spending. He remarked on the
committee's action to eliminate PFD funding that would go a
long way to help poor people, while at the same time,
adding money to the budget to support poor people. He
thought the committee was saying that it believed the
government needed to spend money for poor people rather
than putting money into poor people's hands. He opposed the
amendment.
Co-Chair Foster relayed that he voted against the $1,100
PFD in Amendment 2 because his district supported a full
PFD. However, he would be supporting the current amendment.
He shared that Alaska Legal Services had a presence in Nome
and he saw the value of the service for the reasons
highlighted by Co-Chair Merrick.
Representative Wool referenced a table showing PFD
recipients. He noted that the table did not list
recipients' income. He pointed out that in 2020, 630,937
applications had been paid. He did not believe all PFD
applicants were poor. He supported that ALSC helped
financially challenged individuals. He remarked that the
PFD went out to everyone, regardless of wealth. He would
support the amendment.
6:54:32 PM
Co-Chair Merrick provided wrap up on the amendment. She
relayed that Alaska Legal Services' core purpose of
ensuring access and fairness in the justice system was a
fundamental American value. She believed everyone on the
committee saw the value of the program. She noted that
earlier in the evening she had enthusiastically supported
paying $114 million of oil and gas tax credits. She
underscored that the $400,000 in Amendment 4 reflected
0.003 percent of the amount paid to oil and gas tax
credits.
Representative Carpenter MAINTAINED the OBJECTION.
A roll call vote was taken on the motion.
IN FAVOR: Rasmussen, Thompson, Wool, Edgmon, Josephson,
Ortiz, Merrick, Foster
OPPOSED: Carpenter, LeBon
Representative Johnson was absent from the vote.
The MOTION to ADOPT Amendment 4 PASSED (8/2). There being
NO further OBJECTION, Amendment 4 was ADOPTED.
Co-Chair Foster indicated that the remainder of the
amendments would be taken up the following morning.
Representative LeBon asked if the committee should meet at
9:00 a.m. due to the House Floor session beginning at 10:00
a.m.
Co-Chair Foster anticipated that the floor session would
meet after the committee concluded the following day.
6:57:09 PM
AT EASE
6:57:52 PM
RECONVENED
Co-Chair Foster indicated the committee would recess until
the following morning at 10:00 a.m.
^RECESSED to AUGUST 25, 2021.
6:58:14 PM
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB3003 Amendments 1-6 082421.pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |
| HB 3003 Public Testimony Pkt 1 rec'd by 082421.pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |
| HB 3003 Amendment 1 to Amendment 1 Ortiz 082421 (2).pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |
| HB 3003 Amendment 2 to Amendment 1 Ortiz 082421.pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |
| HB3003 HF Public Testimony Pkt 2 rec'd on 08.24.21.pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |
| HB 3003 Amendment 7 Foster 082421.pdf |
HFIN 8/24/2021 1:00:00 PM |
HB3003 |