Legislature(1999 - 2000)
02/29/2000 08:11 AM House CRA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE COMMUNITY AND REGIONAL AFFAIRS
STANDING COMMITTEE
February 29, 2000
8:11 a.m.
MEMBERS PRESENT
Representative John Harris, Co-Chairman
Representative Carl Morgan, Co-Chairman
Representative Andrew Halcro
Representative Lisa Murkowski
Representative Reggie Joule
Representative Albert Kookesh
MEMBERS ABSENT
Representative Fred Dyson
COMMITTEE CALENDAR
HOUSE BILL NO. 265
"An Act extending the termination date of the Alaska regional
economic assistance program; and providing for an effective
date."
- MOVED HB 265 OUT OF COMMITTEE
PREVIOUS ACTION
BILL: HB 265
SHORT TITLE: ALASKA REGIONAL ECONOMIC AID PROGRAM
SPONSOR(S): REPRESENTATIVES(S) AUSTERMAN, Morgan
Jrn-Date Jrn-Page Action
1/10/00 1889 (H) PREFILE RELEASED 12/30/99
1/10/00 1889 (H) READ THE FIRST TIME - REFERRALS
1/10/00 1889 (H) EDT, CRA
2/09/00 (H) EDT AT 5:00 PM CAPITOL 124
2/09/00 (H) Moved Out of Committee
2/09/00 (H) MINUTE(EDT)
2/18/00 2239 (H) COSPONSOR(S): MORGAN
2/21/00 2250 (H) EDT RPT 5DP 1NR
2/21/00 2250 (H) DP: BARNES, CISSNA, HALCRO, KERTTULA,
2/21/00 2250 (H) PHILLIPS; NR: DYSON
2/21/00 2251 (H) FISCAL NOTE (H.EDT/DCED)
2/21/00 2251 (H) REFERRED TO CRA
2/21/00 2258 (H) FIN REFERRAL ADDED
2/29/00 (H) CRA AT 8:00 AM CAPITOL 124
WITNESS REGISTER
REPRESENTATIVE ALAN AUSTERMAN
Alaska State Legislature
Capitol Building, Room 434
Juneau, Alaska 99801
POSITION STATEMENT: Testified as sponsor of HB 265.
FRANK HOMAN, Executive Director
Southeast Conference
Member, Association of ARDOR Directors
213 Third Street
Juneau, Alaska 99801
POSITION STATEMENT: Testified on behalf of all the ARDORs in
support of HB 265.
CHARLES PARKER
Mat-Su Resource Conservation & Development Council
351 West Parks Highway, Suite 100
Wasilla, Alaska 99654
POSITION STATEMENT: Urged support of HB 265.
PAT POLAND, Director
Division of Municipal & Regional Assistance
Department of Community & Economic Development
333 West Fourth Avenue, Suite 220
Anchorage, Alaska 99501-2341
POSITION STATEMENT: Testified in support of the ARDOR program.
ACTION NARRATIVE
TAPE 00-14, SIDE A
Number 0001
CO-CHAIRMAN HARRIS called the House Community and Regional
Affairs Standing Committee meeting to order at 8:11 a.m.
Members present at the call to order were Representatives Harris,
Morgan, Halcro, Murkowski and Joule. Representative Kookesh
arrived as the meeting was in progress. Representative Dyson was
not in attendance.
HB 265-ALASKA REGIONAL ECONOMIC AID PROGRAM
CO-CHAIRMAN HARRIS announced that the only order of business
before the committee would be HOUSE BILL NO. 265, "An Act
extending the termination date of the Alaska regional economic
assistance program; and providing for an effective date."
Number 0078
REPRESENTATIVE ALAN AUSTERMAN, Alaska State Legislature, sponsor
of HB 265, commented that HB 265 is a fairly simple bill that
basically extends the life of the Alaska Regional Development
Organizations (ARDORs) to July 1, 2003.
REPRESENTATIVE MURKOWSKI commented that every "easy" bill that
this committee has heard has gone onto another committee where it
is no longer an "easy" bill.
REPRESENTATIVE AUSTERMAN surmised that HB 265 would receive a
referral to the House Finance Committee due to its $650,000
fiscal note. He explained that the funding source is coming from
the Alaska Industrial Development and Export Authority (AIDEA).
There has been discussion of eliminating that funding. He noted
that the House Finance Subcommittee left the ARDORs in the
budget; however, he expected discussion on that point by the full
House Finance Committee.
REPRESENTATIVE AUSTERMAN pointed out that the House Finance
Subcommittee basically eliminated the International Trade and
Development (program). There are not many economic development
tools left in the state's coffer, but ARDOR is one of those. He
noted that ARDOR is one of the programs that the House Finance
Subcommittee was directed to [eliminate] from the budget, but it
did not.
Number 0302
REPRESENTATIVE JOULE asked if this money is general fund (GF)
money.
REPRESENTATIVE AUSTERMAN remarked that it depends upon one's
view. Many legislators view anything coming into the state
coffers as GF money. He pointed out that this is a dividend that
is paid out from AIDEA. It is a matter of perception.
Personally, Representative Austerman believes that anything
coming into the state coffers should be classified as GF money.
Representative Austerman also pointed out that the bottom of the
fiscal note describes the funding source, which is AIDEA's
Enterprise Development Fund.
Number 0495
FRANK HOMAN, Executive Director, Southeast Conference; Member,
Association of ARDOR Directors, informed the committee that the
Southeast Conference is a regional ARDOR member. He announced
support of passage of HB 265 for all the ARDORs. This is a
program that seems to need a small amount on the state side,
while it generates about $3.5 million per year with all 13 ARDORs
together. That $3.5 million is generated from other sources to
help promote economic development within the various regions of
the state.
MR. HOMAN referred the committee to the document entitled,
"Alaska Regional Development Organizations," included in the bill
packet. The document specifies what each ARDOR has been able to
accomplish in each region; the last page is a map that
illustrates the distribution of the ARDORs through the state.
Mr. Homan commented that with the ARDOR program, people within
the region come together to discuss where the region wants to go,
in regard to economic development. He highlighted that people
from the development side to the conservation side come together
to promote things that would improve their particular region's
situation. In conclusion, Mr. Homan encouraged the committee's
support for HB 265.
CO-CHAIRMAN HARRIS asked how many ARDORs would go out of business
without these funds.
MR. HOMAN referred the committee to the annual report. He
pointed out that the $47,000 generated for each ARDOR represents
almost all of the funding some ARDORs receive, especially in the
rural areas where there is not enough local/private business to
generate matching funds. Matching funds are required whenever
possible. Therefore, Mr. Homan suggested that maybe four or five
ARDORs would not survive without this funding.
CO-CHAIRMAN HARRIS commented that two of the ARDORs that would
not survive without this funding are probably in his district.
He noted that two of the directors of the two ARDORs in his
region did not travel to the ARDOR meeting due to low funding.
MR. HOMAN said the ARDOR meetings are usually by teleconference
because there is so little money available for travel,
particularly for the newer rural ARDORs. The Anchorage and
Southwest Alaska ARDORs are probably the most secure. He
informed the committee that in the Southeast Conference, the
ARDOR money provides about 50 percent of the operating money.
There are a lot of grants that come through the Southeast
Conference, but in regards to the actual administrative money the
ARDOR provides about half. Therefore, the elimination of the
ARDOR funding would significantly reduce the Southeast
Conference's ability.
Number 0914
REPRESENTATIVE MURKOWSKI asked if there is resistance to the
formation of new ARDORs. She assumed that with new ARDORs there
would not be more state money, and therefore the same amount of
funding would be split between more groups and would result in
each receiving less. Is there some competition among the ARDORS
in regard to that?
MR. HOMAN answered that there could be competition. He confirmed
that it is a fixed amount of money. He recalled that two new
ARDORs have formed. The department worked with the ARDOR
association and determined that the following formula would be
followed: divide the amount of dollars by the number of ARDORs.
Therefore, the ARDOR association recommended that each ARDOR be
treated equally and not compete with each other for the money.
[The ARDOR association] realized that the stronger ARDORs could
compete more vigorously than the rural ARDORs. Mr. Homan felt
that sharing philosophy was a smart decision on their part.
MR. HOMAN informed the committee that he knew of one ARDOR that
is about to be approved. Therefore, the amount for each ARDOR
will be reduced. This discussion will probably have to be
revisited again. However, in the past it was a sharing
philosophy. Mr. Homan recognized that the other option, which is
probably not a good option, is to seek more funding. He said
that about $50,000 per year [for each ARDOR] is a workable
amount.
Number 1165
CHARLES PARKER, Mat-Su Resource Conservation & Development
Council, testified via teleconference from the Mat-Su Legislative
Information Office (LIO). He noted that the Mat-Su Resource
Conservation & Development Council is the ARDOR for the
Matanuska-Susitna Borough. He commented that in his past
experience with rural Alaska, there is no comparison to the ARDOR
program. Mr. Parker noted that he works directly for an ARDOR
program. With very little money, the ARDORs have been able to
accomplish a great deal both regionally and statewide.
Statewide, the ARDORs have managed to leverage over $5 in private
and federal money for every $1 invested by the state for local
development projects. Although these are substantial figures,
they are conservative figures that relate to dollars received
directly by the ARDORs to match the state grant. This does not
include technical assistance provided on development projects,
which can bring in more private and federal funds that are almost
impossible to quantify.
MR. PARKER informed the committee that in the Mat-Su Valley the
ARDOR manages accounts for numerous community organizations, many
of which would not have been able to accomplish their goals
without the help of the ARDOR program. He noted that the Mat-Su
ARDOR has managed accounts that total over $300,000 in the last
two years. Therefore, the financial impacts over the long term
is very substantial because the ARDORs work to create jobs,
reduce unemployment and decrease the burden on public assistance.
As the ARDORs improve local economies and increase the quality of
life, the communities' dependence on direct state and federal
services is reduced. Although the elimination of the ARDOR
program may reduce costs for this year and perhaps next year,
such action would send the local economies into a downward
spiral. Therefore, the cost of government services would be
greatly increased within a few years. Mr. Parker pointed out
that although many ARDORs such as the Mat-Su ARDOR have long-term
plans which include self-sufficiency, many of the ARDORs would
not survive without the support of the ARDOR program. In
conclusion, Mr. Parker urged the committee's support of HB 265.
Number 1371
PAT POLAND, Director, Division of Municipal & Regional
Assistance, Department of Community & Economic Development,
testified via teleconference from Anchorage. He said that he was
available to answer questions. He noted that the division had
previously testified in support of the ARDOR program.
CO-CHAIRMAN HARRIS announced that public testimony would be
closed.
Number 1390
REPRESENTATIVE MURKOWSKI moved to report HB 265 out of committee
with individual recommendations and the accompanying fiscal
notes.
CO-CHAIRMAN HARRIS objected for purposes of discussion.
REPRESENTATIVE JOULE pointed out that six of the existing
programs spoke to the issue of workforce development. In the
scheme of the state's overall budget, this is a small amount to
pay for economic development. He commented that sometimes the
best resources are people. With six of the programs specifically
speaking to developing the state's workforce and thus its people,
it is a good investment that should continue.
CO-CHAIRMAN HARRIS asked if Representative Joule had seen, in his
region, active involvement by the ARDORs in workforce
development.
REPRESENTATIVE JOULE replied yes and noted that it is an ongoing
process. He indicated that this seed money [from the ARDOR]
opens opportunities. He likened it to the permanent fund
dividend program.
CO-CHAIRMAN MORGAN disclosed that he is the Vice President of the
Interior Rivers Resource Conservation & Development (RC&D), which
has submitted an application for an ARDOR. The Interior Rivers
RC&D views the ARDOR as being helpful with some travel as well as
opening the door to the state system of granting.
CO-CHAIRMAN MORGAN informed the committee of the following:
The Interior Rivers RC&D area is at twentieth century
standards (no Third World conditions) with local
control that guides strong economic development while
protecting the environment, subsistence resources, and
the cultural heritage of all people.
CO-CHAIRMAN HARRIS removed his objection.
There being no objection, HB 265 was reported out of the House
Community and Regional Affairs Standing Committee.
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 8:38 a.m.
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