02/08/2011 02:00 PM Senate LABOR & COMMERCE

              SB  34-SMALL BUSINESS REVOLVING FUND                                                                          
                                                                                                                                
CHAIR EGAN announced the first order  of business would be SB 34,                                                               
relating to the small business revolving loan fund.                                                                             
                                                                                                                                
2:05:15 PM                                                                                                                    
SENATOR PASKVAN moved to adopt  the proposed committee substitute                                                               
to SB  34, labeled  27-LS0286\B, as the  working document  of the                                                               
committee. Without objection, the motion carried.                                                                               
                                                                                                                                
2:06:02 PM                                                                                                                    
DANA OWEN, staff  to Senator Egan, explained the  changes to CSSB
 from the  original bill. On page 2, line  13, the word "grant"                                                               
was missing, which was a drafting  oversight. On page 3, lines 16                                                               
-  21 now  include  a  turn-down provision.  This  gives banks  a                                                               
chance to  make or deny  loans before  the business comes  to the                                                               
state.  He explained this  turn-down provision would apply to any                                                               
loan in excess  of $35,000, and noted that the  bankers are happy                                                               
with it.  On line  30, new  language clarifies  that you  must be                                                               
turned down  from an  Alaska institution. Mr.  Owen noted  a memo                                                               
attached to the  draft CS by Legislative  Legal Services Attorney                                                               
Terry  Bannister,  which  points  out  potential  conflicts  with                                                               
federal law. This is not unusual.  He further noted there are two                                                               
revised fiscal notes.                                                                                                           
                                                                                                                                
2:08:35 PM                                                                                                                    
SENATOR  WIELECHOWSKI, sponsor  of SB  34, said  he supports  the                                                               
changes in the CS, and noted it is a very fair compromise.                                                                      
                                                                                                                                
2:09:42 PM                                                                                                                    
WANETTA  AYERS, Director,  Division  of  Commerce, Community  and                                                               
Economic  Development,  said  she  was available  to  answer  any                                                               
questions about the fiscal notes.                                                                                               
                                                                                                                                
2:10:26 PM                                                                                                                    
CRAIG  DAHL,  President and  CEO,  Alaska  Pacific Bank,  Juneau,                                                               
representing   that  bank   as   well  as   the  Alaska   Bankers                                                               
Association,  testified that  both support  SB 70.  He said  that                                                               
Alaskan  banks  have  consistently   served  the  small  business                                                               
community.  In addition  to direct  lending, all  the banks  have                                                               
participated in federal government  programs. For example, Alaska                                                               
Pacific Bank  has received the  Small Business  Association (SBA)                                                               
Community Lender  of the Year  award for four  consecutive years.                                                               
Wells  Fargo has  received the  SBA lender  of the  year for  two                                                               
consecutive years.                                                                                                              
                                                                                                                                
2:14:56 PM                                                                                                                    
SENATOR PASKVAN  commented it  was his  understanding that  SB 34                                                               
focuses  on  new  business  customers,  as  opposed  to  existing                                                               
customers receiving new loans.                                                                                                  
                                                                                                                                
MR. DAHL replied  they do not have a breakdown  of those numbers,                                                               
but  in general  there were  not a  lot of  brand new  businesses                                                               
starting up in the past year.                                                                                                   
                                                                                                                                
2:16:06 PM                                                                                                                    
SENATOR PASKVAN moved to report CS for SB 34 from committee with                                                                
individual recommendations and accompanying fiscal notes.                                                                       
Without objection, CSSB 34(L&C) moved from committee.