Legislature(1997 - 1998)

02/18/1997 01:43 PM House FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  HOUSE BILL NO. 35                                                            
                                                                               
       "An Act extending  the termination  date of the  Alaska                 
       regional economic assistance program; and providing for                 
       an effective date."                                                     
                                                                               
  Representative  Austerman provided  members  with a  sponsor                 
  statement.  He observed that the Alaska Regional Development                 
  Organizations  program  was  created  in  statute  in  1988.                 
  Commonly referred to as ARDOR's, they are private, nonprofit                 
  corporations formed by  local initiative to  promote private                 
  sector economic development within their designated regions.                 
                                                                               
  The ARDOR program  has led to  the formation of 11  regional                 
  development  organizations  such  as  the  Southwest  Alaska                 
                                                                               
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  Municipal Conference,  the Southeast  Conference, the  Lower                 
  Kuskokwim  Economic Development  Council  and the  Anchorage                 
  Economic Development  Corporation.   He maintained  that the                 
  nearly  two  hundred  representatives  of  local  political,                 
  social and  economic interests, who serve on ARDOR boards of                 
  directors, are  working together  to lead  their regions  to                 
  greater economic self-sufficiency.                                           
                                                                               
  The  original legislation had a sunset clause that ended the                 
  program in 1993,  but was extended  until the end of  fiscal                 
  year 1997.  He stated that it is in the best interest of the                 
  State of Alaska to continue the  ARDOR program to ensure the                 
  ongoing economic viability of Alaska's various regions.                      
                                                                               
  Representative  Austerman provided  members with  the Alaska                 
  Regional  Development  Organizations'  Annual Report,  March                 
  1996 (copy  on file).   He  noted that  the last  page shows                 
  funding sources generated  by program.  State funding  was a                 
  little  more  than $600  thousand  dollars  in FY  97.   The                 
  addition  of private  funds resulted  in a  total budget  of                 
  $6,585 million dollars in FY 97.                                             
                                                                               
  PAUL FUHS,  ALASKA ARDOR ASSOCIATION  spoke in behalf  of HB
  35.   He pointed  to the ARDOR  program as  an example  of a                 
  successful private/public  partnership.   He emphasized  the                 
  importance  of  local  implementation  and  coordination  of                 
  projects.    He observed  that  state funding  comes through                 
  Alaska Industrial Development  and Export Authority  (AIDEA)                 
  program receipts.   The Governor has proposed  $620 thousand                 
  dollars for the ARDOR program in FY 98.  He observed  that a                 
  local match is required.                                                     
                                                                               
  Representative Martin expressed his opposition to HB 35.  He                 
  questioned what the ARDOR's do that  cannot be done by local                 
  Chambers of Commerce and Rotary Clubs.                                       
                                                                               
  Mr.  Fuhs emphasized that  ARDOR's provide  a private/public                 
  cooperative effort to look for  infrastructure on a regional                 
  level.  He gave  examples of ARDOR programs.   He maintained                 
  that  Chambers of  Commerce  would  not provide  coordinated                 
  services.  He stated that the Alaska ARDOR Association would                 
  welcome a legislative audit.                                                 
                                                                               
  MARY STADUM, EXECUTIVE DIRECTOR, SOUTHWEST ALASKA  MUNICIPAL                 
  CONFERENCE  testified  via  the  teleconference  network  in                 
  support of  HB 35.   She  observed that  the Conference  was                 
  founded  before  the  ARDOR program  was  established.   She                 
  reviewed services provided by the  Conference.  She stressed                 
  that ARDOR's bring local Chambers  of Commerce together with                 
  other organizations.                                                         
                                                                               
  (Tape Change, HFC 97-32, Side 1)                                             
                                                                               
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  Ms.  Stadum  emphasized that  ARDOR's  allow people  to work                 
  together  and share resources.   She  noted that  leaders in                 
  small  communities wear  many  hats.    She noted  that  the                 
  Conference passed two resolutions  in expressing support for                 
  the ARDOR program.                                                           
                                                                               
  ALICE RUBY, COUNCIL MEMBER, CITY OF DILLINGHAM testified via                 
  the teleconference  network  in  support  of  HB  35.    She                 
  maintained that the  program has allowed  them to work on  a                 
  grass  roots  level  to  provide  information,   networking,                 
  technical assistance and to serve as a catalyst for economic                 
  development and diversification.  She gave examples of ARDOR                 
  activities.                                                                  
                                                                               
  DONNA TOLLMAN,  EXECUTIVE DIRECTOR,  COPPER VALLEY  ECONOMIC                 
  DEVELOPMENT   COUNCIL,   GLENNALLEN   testified    via   the                 
  teleconference network.   She urged support  of HB 35.   She                 
  observed the  affects of  reductions to  the ARDOR  program.                 
  She  stressed  that  the  Council,  through a  contract  for                 
  welfare to work  programs, helps to develop  self efficiency                 
  plans  for  residents.     The  Council  also   helps  small                 
  businesses to  create development plans.  She noted that the                 
  Council is involved in tourism and child care.                               
                                                                               
  Representative Martin maintained  that activities  performed                 
  by the Council  should be done  by government.  Ms.  Tollman                 
  emphasized  the  distance  of  the  region from  the  Palmer                 
  office.                                                                      
                                                                               
  In response to  a question by  Co-Chair Hanley, Ms.  Tollman                 
  noted that the Council received its contract for the welfare                 
  to  work  program through  the  Department of  Community and                 
  Regional Affairs.                                                            
                                                                               
  JAMES  ELSON,  CHAIRMAN,  KENAI PENINSULA  BOROUGH  ECONOMIC                 
  DEVELOPMENT DISTRICT, KENAI testified via the teleconference                 
  network.  He spoke in support of HB 35.  He observed that he                 
  has served as a volunteer  of the local ARDOR  organization.                 
  He stressed that  state funding has  allowed them to  obtain                 
  good professional staff.   He pointed out that ARDOR's  also                 
  receive private  funding.  He  stressed that jobs  have been                 
  created through  economic development efforts.  He recounted                 
  accomplishments of  the  Kenai  Peninsula  Borough  Economic                 
  Development District.                                                        
                                                                               
  SHERRY BIGGS,  KENAI PENINSULA BOROUGH  ECONOMIC DEVELOPMENT                 
  DISTRICT,  KENAI testified via the teleconference network in                 
  support of  HB 35.   She  emphasized that  Kenai has a  very                 
  diversified economy.  She stressed that  there needs to be a                 
  regional approach.   She  maintained that  ARDOR provides  a                 
  bridge between government and private enterprise.                            
                                                                               
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  Mr. Elson observed  that ARDOR's can contract  directly with                 
  the State without going through the competitive bid process.                 
                                                                               
                                                                               
  JAMES WINCHESTER,  EXECUTIVE DIRECTOR, PRINCE  WILLIAM SOUND                 
  ECONOMIC    DEVELOPMENT    COUNCIL,   testified    via   the                 
  teleconference  network in support of HB  35.  He maintained                 
  that the Council is  about providing jobs.  The  Council has                 
  three main areas of  activities, small business development,                 
  infrastructure development projects,  and economic  recovery                 
  projects.   The Council has a $3.0 million dollar budget and                 
  2 and half full time staff positions.                                        
                                                                               
  PATRICIA DEMARCO, PRESIDENT, ANCHORAGE  ECONOMIC DEVELOPMENT                 
  CORPORATION  testified  via  the  teleconference network  in                 
  support of  HB 35.   She  emphasized the  importance of  the                 
  ARDOR program  as an   integrating force  across the  State.                 
  She stressed efforts  to provide year-round jobs.  She noted                 
  that planning  functions are  not easily  funded by  private                 
  sector initiatives.  She reviewed ARDOR projects implemented                 
  by the Anchorage Economic Development Corporation.                           
                                                                               
  IKE  WAITS,  ARDOR  PROGRAM,  DEPARTMENT  OF  COMMUNITY  AND                 
  REGIONAL  AFFAIRS  observed that  the  program is  a  way to                 
  stretch state funds  for regional economic development.   He                 
  spoke in support of the ARDOR Program.                                       
                                                                               
  BERNE  MILLER,  EXECUTIVE  DIRECTOR,   SOUTHEAST  CONFERENCE                 
  testified in support  of HB  35.  He  provided members  with                 
  written testimony  (copy on  file).   He  stressed that  the                 
  program relies on  local and regional decision  making about                 
  what is important.   In response  to a question by  Co-Chair                 
  Hanley,  Mr. Miller acknowledged that the Conference existed                 
  before  it  received  state ARDOR  funding.    The Southeast                 
  Conference's  total  FY  97  budget  is  approximately  $225                 
  thousand dollars.                                                            
                                                                               
  Representative  Kohring expressed  concern with  the State's                 
  participation.                                                               
                                                                               
  Mr.   Miller   stated  that   the   Conference   helps  show                 
  organizations  how   to  execute  projects  as  quickly  and                 
  economically as possible.                                                    
                                                                               
  Co-Chair  Hanley  clarified  that   ARDOR's  are  non-profit                 
  groups.   Individual regional  organizations administer  the                 
  program.                                                                     
                                                                               
  Co-Chair  Hanley  acknowledged  the  benefit  of  the  ARDOR                 
  program.    He  pointed  out   that  many  of  the  regional                 
  organizations would continue to exist without state funding.                 
                                                                               
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  He emphasized  that funding  may be  reduced.  He  clarified                 
  that each ARDOR  receives $55.0 thousand dollars.   He asked                 
  why all ARDOR's receive the same funding.                                    
                                                                               
  Mr. Fuhs  noted that the original appropriation to the ARDOR                 
  program  was $1.6  million dollars.   The  Governor's FY  98                 
  request is $620 thousand dollars.   He maintained that equal                 
  funding is the most  fair.  The required local  match varies                 
  based on capability.                                                         
  Representative  Martin  pointed  out   that  $55.0  thousand                 
  dollars pays for one  position per ARDOR.  He  spoke against                 
  continuing the program.                                                      
                                                                               
  Mr. Fuhs observed that private business  does not want to be                 
  over  regulated.    He added  that  government  working with                 
  business for economic development "makes all  the difference                 
  in the world."                                                               
                                                                               
  Representative Foster MOVED to report HB 35 out of Committee                 
  with individual  recommendations and  with the  accompanying                 
  fiscal note.   Representative  Martin OBJECTED.   He  stated                 
  that the ARDOR program should undergo an audit to  determine                 
  if all eleven  ARDOR's should be funded.   A roll call  vote                 
  was taken on the MOTION.                                                     
                                                                               
  IN FAVOR: Davies,  Davis,   Foster,  Grussendorf,   Kohring,                 
  Mulder,        Therriault,  Hanley                                           
  OPPOSED:  Martin                                                             
                                                                               
  Representative Kelly was absent from the vote.                               
                                                                               
  The MOTION PASSED (9-1).                                                     
                                                                               
  HB  35  was  reported out  of  Committee  with  a "do  pass"                 
  recommendation  and  with  a  fiscal   impact  note  by  the                 
  Department of Community and Regional Affairs, dated 2/5/97.                  

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