Legislature(2013 - 2014)BUTROVICH 205

04/12/2013 09:00 AM JUDICIARY


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SB 51 EXTEND BAR ASS'N BOARD OF GOVERNORS TELECONFERENCED
Scheduled But Not Heard
-- Public Testimony --
+= HB 63 EXTEND BAR ASS'N BOARD OF GOVERNORS TELECONFERENCED
Moved CSHB 63(FIN) Out of Committee
-- Public Testimony --
+= SCR 3 JOINT COMMITTEE ON FEDERAL OVERREACH TELECONFERENCED
Moved CSSCR 3(JUD) Out of Committee
-- Public Testimony --
+ HB 57 ENTITY TRANSACTIONS ACT TELECONFERENCED
Moved CSHB 57(JUD) Out of Committee
-- Public Testimony --
                 HB  57-ENTITY TRANSACTIONS ACT                                                                             
                                                                                                                                
10:02:11 AM                                                                                                                   
CHAIR  COGHILL announced  the  consideration of  HB  57. "An  Act                                                               
adopting  the   Alaska  Entity  Transactions  Act;   relating  to                                                               
changing   the   form   of  entities,   including   corporations,                                                               
partnerships, limited  liability companies, business  trusts, and                                                               
other  organizations; amending  Rule  79, Alaska  Rules of  Civil                                                               
Procedure, and  Rules 602(b)(2), 602(c), and  605.5, Alaska Rules                                                               
of Appellate Procedure; and providing for an effective date."                                                                   
                                                                                                                                
[CSHB 57(JUD) was before the committee.]                                                                                        
                                                                                                                                
10:02:39 AM                                                                                                                   
REPRESENTATIVE LINDSAY HOLMES, sponsor of HB 57, introduced the                                                                 
bill speaking to the following sponsor statement:                                                                               
                                                                                                                                
     House   Bill   57   conforms   to   the   Uniform   Law                                                                    
     Commissioners' Model Entity  Transaction Act (META). If                                                                    
     implemented in  the State  of Alaska,  this legislation                                                                    
     will  help facilitate  transactions  between more  than                                                                    
     one  form  of  entity, improve  the  existing  business                                                                    
     climate   in  Alaska,   and  help   reduce  unnecessary                                                                    
     administrative and  legal burdens currently  imposed on                                                                    
     Alaska companies.                                                                                                          
                                                                                                                                
     During  the  past  twenty  years   many  new  types  of                                                                    
     business   entities  -   including  limited   liability                                                                    
     companies, limited liability  partnerships, and limited                                                                    
     liability limited  partnerships - have  been recognized                                                                    
     under state  law. As a  result of the  proliferation of                                                                    
     new entity  forms, many businesses now  utilize various                                                                    
     types of  entities in their  organizational structures.                                                                    
     The relaxation  of federal  tax rules  governing entity                                                                    
     classification has led to an  increase in the volume of                                                                    
     restructuring  and  acquisition   transactions  by  and                                                                    
     among the various types of entity forms.                                                                                   
                                                                                                                                
     Because  of  the  lack  of  clear  statutory  authority                                                                    
     allowing  transactions between  more than  one form  of                                                                    
     entity, these transactions have  often required the use                                                                    
     of  multiple indirect  steps, as  opposed  to a  single                                                                    
     transaction.  House Bill  57 will  offer new  statutory                                                                    
     authority to permit  cross-entity transactions in order                                                                    
     to remain responsive to the  needs of Alaskan companies                                                                    
     and  should  be  enacted  in   order  to  allow  Alaska                                                                    
     businesses  the opportunity  to engage  in cross-entity                                                                    
     transactions.                                                                                                              
                                                                                                                                
     Adopting  HB  57  will be  an  important  step  towards                                                                    
     bringing Alaska  more into the mainstream  of statutory                                                                    
     business law                                                                                                               
                                                                                                                                
REPRESENTATIVE HOLMES  noted that  a letter  in the  packets from                                                               
Doyon   Corporation  speaks   to  how   this  will   help  Native                                                               
corporations. The  bill basically  makes it easier  for different                                                               
business entities to  communicate, do business, and  merge. It is                                                               
based on model law.                                                                                                             
                                                                                                                                
10:06:54 AM                                                                                                                   
HARRY   HAYNSWORTH,   Commissioner,    National   Conference   of                                                               
Commissioners on Uniform State Laws,  stated that he was chair of                                                               
the drafting committee for the  Model Entity Transactions Act. He                                                               
said the  sponsor provided an  excellent summary and why  this is                                                               
particularly  important  for  states  like Alaska  that  have  an                                                               
incomplete  statutory   framework.  He  offered  to   respond  to                                                               
questions on amendments that might be proposed.                                                                                 
                                                                                                                                
10:08:25 AM                                                                                                                   
JAMES WALDO, Staff, Representative  Lindsay Holmes, sponsor of HB
57,  clarified   that  Mr.  Haynsworth  was   referring  to  some                                                               
technical amendments  that were  proposed in the  House Judiciary                                                               
Committee at the behest of  Department of Commerce, Community and                                                               
Economic Development (DCCED).                                                                                                   
                                                                                                                                
10:08:56 AM                                                                                                                   
At ease                                                                                                                         
                                                                                                                                
10:13:16 AM                                                                                                                   
CHAIR COGHILL reconvened the meeting  and explained that the off-                                                               
the-record discussion  related to when  the bill would  reach the                                                               
floor. He recognized that there  were some concerns with the bill                                                               
but that he was satisfied. He solicited a motion.                                                                               
                                                                                                                                
10:13:46 AM                                                                                                                   
SENATOR MCGUIRE  moved to report  CS for  HB 57, version  Y, from                                                               
committee  with  individual  recommendations  and  attached  zero                                                               
fiscal note(s).                                                                                                                 
                                                                                                                                
10:14:10 AM                                                                                                                   
SENATOR WIELECHOWSKI objected.                                                                                                  
                                                                                                                                
CHAIR COGHILL asked him to speak to his objection.                                                                              
                                                                                                                                
SENATOR  WIELECHOWSKI said  it's  probably a  good  bill, but  he                                                               
couldn't in good  conscience vote to move a 50-page  bill after a                                                               
15 minute  hearing when he  didn't understand what it  does. This                                                               
is  the  only  committee  of  referral  in  the  Senate  and  the                                                               
committee didn't even receive a  sectional walk through. He noted                                                               
that this  wasn't a special  request for  this bill; he  made the                                                               
same request on  the large ROTH IRA bill and  the chair agreed to                                                               
hold an additional hearing. He restated his objection.                                                                          
                                                                                                                                
CHAIR  COGHILL  said  he  understood the  objection  but  he  was                                                               
satisfied that  the bill was  virtually identical to the  one the                                                               
committee heard last year.                                                                                                      
                                                                                                                                
10:15:50 AM                                                                                                                   
A roll call vote was  taken. Senators McGuire, Dyson, and Coghill                                                               
voted  in  favor   of  moving  HB  57   from  committee;  Senator                                                               
Wielechowski  voted  against  it.  Therefore,  CSHB  57(JUD)  was                                                               
reported  out of  the Senate  Judiciary Standing  Committee by  a                                                               
vote of 3-1.                                                                                                                    
                                                                                                                                
10:16:26 AM                                                                                                                   
CHAIR  COGHILL stated  that CSHB  57(JUD) moved  from the  Senate                                                               
Judiciary Standing Committee  with individual recommendations and                                                               
attached fiscal note.                                                                                                           

Document Name Date/Time Subjects
Legal Memo April 9 2013 re Board of Governors.pdf SJUD 4/12/2013 9:00:00 AM
HB 63
Letter from t Obermeyer 4 11 2013 HB 63.pdf SJUD 4/12/2013 9:00:00 AM
HB 63
Email from T. Obermeyer - HB 63.pdf SJUD 4/12/2013 9:00:00 AM
HB 63