Legislature(2009 - 2010)HOUSE FINANCE 519
03/24/2010 09:00 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB291 | |
| HB292 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 291 | TELECONFERENCED | |
| + | HB 292 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
March 24, 2010
9:07 a.m.
9:07:36 AM
CALL TO ORDER
Co-Chair Stoltze called the House Finance Committee meeting
to order at 9:07 a.m.
MEMBERS PRESENT
Representative Mike Hawker, Co-Chair
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Vice-Chair
Representative Allan Austerman
Representative Mike Doogan
Representative Anna Fairclough
Representative Neal Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
Representative Woodie Salmon
MEMBERS ABSENT
None
ALSO PRESENT
Bryan Butcher, Public Affairs Director, Alaska Housing
Finance Corporation (AHFC); Joe Dubler, Chief Financial
Officer, Alaska Housing Finance Corporation (AHFC); McHugh
Pierre, Deputy Commissioner, Department of Military and
Veterans Affairs (DMVA); Michael O'Hare, Deputy Director,
Division of Homeland security and Emergency Management,
DMVA
PRESENT VIA TELECONFERENCE
Laurie Holte, Alaska Housing Finance Corporation
SUMMARY
HB 291 GUARANTEED REVENUE BONDS FOR VETERANS
HB 291 was REPORTED out of Committee with a
"do pass" recommendation and with previously
published fiscal notes: FH1 (OOG) and FN2
(REV)
HB 292 GRANTS TO DISASTER VICTIMS
HB 292 was REPORTED out of Committee with a
"do pass" recommendation and with a new
zero fiscal note.
9:07:44 AM
Co-Chair Stoltze presented the overview for the morning.
HOUSE BILL NO. 291
"An Act relating to the issuance of state-guaranteed
revenue bonds by the Alaska Housing Finance
Corporation to finance mortgages for qualifying
veterans; and providing for an effective date."
9:08:22 AM
BRYAN BUTCHER, PUBLIC AFFAIRS DIRECTOR, ALASKA HOUSING
FINANCE CORPORATION (AHFC) reported that this bill would
allow Alaskans to vote on approving AHFC to sell up to $600
million in bonds to fund the veteran's mortgage program. He
provided a history of the federal program that allowed
states to sell tax exempt debts to fund a program for
veterans that would be one half to five-eighths of a
percentage point below the normal taxable rate. Only five
states signed up originally: California, Texas, Oregon,
Wisconsin and Alaska. The eligible requirement is to be in
the service 1977 or earlier and not out for longer than 30
years. There were fewer veterans eligible as time has
passed. There were efforts to get Congress to lift this
time limit, but when the 1977 requirement was finally
lifted the federal statute restricted the selling of only
$10 million in bonds to fund the program per year. The
number was lifted in 2008 to enable the selling of $100
million in bonds to fund the program. There was a potential
to run out of funds in 2011. The Alaska Housing Finance
Corporation is still responsible for funding the program;
no state money has had to go into the program. The goal is
to get it on the ballot this year to continue with the
program.
9:11:32 AM
Representative Doogan believed the State Guaranteed Revenue
Bond is really a General Obligation Bond.
JOE DUBLER, CHIEF FINANCIAL OFFICER, ALASKA HOUSING FINANCE
CORPORATION (AHFC) answered that the Revenue Bond relies
primarily upon some source, in this case mortgage loans, to
make the debt service. The statute requires that there be a
general obligation pledge behind that revenue stream with
the state of Alaska behind this debt service. These bonds
have never gotten behind at this point.
Representative Doogan wondered why the voters are not being
told that. He emphasized that these are actually General
Obligation Bonds and should not be called by this new name.
Mr. Butcher replied that in the question on the ballot it
will state that it is a general obligation of the state of
Alaska. The fiscal note is requesting $150,000 to provide
an education campaign to all Alaskans to further define
what they are voting on. Representative Doogan relayed that
he wanted it on the record that these were General
Obligation Bonds. Mr. Butcher added that in January 2010,
Standards and Poor did a study of thirty four housing
finance agencies and the AHFC latest bond issuance had the
lowest delinquency rate in the country.
9:15:39 AM
Vice-Chair Thomas inquired on how many loans veterans can
receive under this program. Mr. Dubler replied one loan at
a time and that must be paid off before getting a new loan.
Vice-Chair Thomas asked if the rural rate is lower than the
veteran's rates. Mr. Dubler answered that the rates are
about the same at this time.
9:17:38 AM
Co-Chair Stoltze referred to the public information
campaign and mentioned the heavy advertising done by the
Alaska Housing Finance Committee promoting various things
and wondered if educating the public on this bond could fit
into their existing program. Mr. Butcher contended that
most of the cost would go for mail outs to get the
information to all Alaskans. Co-Chair Stoltze stated that
this bill is well supported and wondered if spending
$150,000 was necessary.
9:18:58 AM
Representative Austerman asked if the Alaska National Guard
would be eligible. Mr. Dubler declared that if they served
any tour of duty and have an honorable discharge, they
would qualify. If they only served in the Alaska National
Guard without being call up, then they would not qualify
for this program.
Representative Foster referred to the Sponsor Statement
where it mentioned serving as a cadet in one the United
States military academies. He questioned if that would
qualify.
9:20:20 AM
LAURIE HOLTE, ALASKA HOUSING FINANCE CORPORATION (via
teleconference) responded that the veteran must have full
time duty other than training.
9:20:49 AM
Co-Chair Hawker stressed that $150,000 was a lot of money
and under this fiscal note AHFC could spend the money any
way they wanted. He asked for assurance that all the money
would be spent on this specific purpose and not other
things. Mr. Butcher emphasized that this fiscal note was
prepared before the operating budget. He expected the
actual dollar amount will be more than $150,000. He assured
that AHFC can follow up on information on how the money is
spent.
Co-Chair Hawker assured that he did not want to create a
larger burden, but thought this might be overkill. Mr.
Butcher remarked that this is different from the normal
marketing of their programs. This will not be promoted, but
only used to provide education on the bill.
Co-Chair Stoltze remarked that AHFC does a lot of
communication through various means and wondered if these
materials can be used to communicate the informational
aspects of this bond package. Mr. Butcher indicated that he
would have to get back regarding how much is spent every
year, but remarked an estimate would be about $200,000 to
$300,000. Co-Chair Stoltze communicated that many
legislators might use this in their election bids since
veteran's issues are popular in the state.
9:24:40 AM
Vice-Chair Thomas noted that the qualified veterans in the
bill eliminate the Vietnam veterans. Mr. Butcher replied
that when the 1977 year was lifted, it was reduced to 25
years. Vice-Chair Thomas believed there was unfair
discrimination against Vietnam veterans since WWII veterans
were still eligible.
9:27:30 AM
Co-Chair Stoltze closed public testimony and referred to
the fiscal note.
Co-Chair Hawker MOVED to report HB 291 out of Committee
with individual recommendations and the accompanying fiscal
notes. There being NO OBJECTION, it was so ordered.
HB 291 was REPORTED out of Committee with a "do pass"
recommendation and with previously published fiscal notes:
FH1 (OOG) and FN2 (REV)
9:29:23 AM
HOUSE BILL NO. 292
"An Act relating to grants to victims of a disaster in
this state; and providing for an effective date."
MCHUGH PIERRE, DEPUTY COMMISSIONER, DEPARTMENT OF MILITARY
AND VETERANS AFFAIRS (DMVA) presented an overview of the
bill. He spoke of the disaster last year in Eagle and other
communities along the Yukon River noting the disparity
between the individual assistance grants programs
established in 1977 compared to the federal grant amount.
When a disaster is declared by the President of the United
States, FEMA issues individual assistance grants based on a
number suggested by the Consumer Price Index (CPI), which
last year was $30,300 per affected household. Mr. Pierre
noted that Alaska grants have not changed from $5000 and
this bill would make the amount for state declared
disasters half of the federal amount. The maximum this year
would be $14,950 per household affected.
MICHAEL O'HARE, DEPUTY DIRECTOR, DIVISION OF HOMELAND
SECURITY AND EMERGENCY MANAGEMENT, DMVA, stressed that
there is a very rigorous process for disaster victims to
prove their loss. Mr. O'Hare noted that his staff sets up a
local disaster assistance center in affected communities.
There is an involved application process with extensive
verification that the loss is real and sustained during the
declared disaster incident.
9:33:31 AM
Representative Gara asked if the Yukon River flooding was
the only disaster in past year. Mr. O'Hare noted a declared
federal disaster in Kodiak affecting critical
infrastructure. Representative Gara asked if this bill
would cover federal or state disasters. Mr. O'Hare replied
that it is specific to state declared disasters. He noted
that in the 2009 spring flood, most communities were
covered under the federal program, but there were about 30
families that did not qualify. All that could be provided
by the state was $5000. He reiterated that it is an
involved application process to collect funds.
Representative Gara asked for an example of someone who
could not be helped enough. Mr. O'Hare noted that there
have been individuals affected who did not fall under the
federal declaration. Representative Gara maintained that
there may still be people suffering from the 2009 flood.
Mr. O'Hare replied that those who did not qualify are
resorting to other methods. Representative Gara asked if
there would be any objection to going back to help those
from 2009 under this bill. Mr. O'Hare declared the bill is
not retroactive. Mr. Butcher added that great steps have
been taken to help those in need to receive volunteer and
donations from the community. Representative Gara noted
there could still be people in need of help from that
flood. Mr. Pierre responded that was correct, but most
needs have been met. The goal is get the individual back on
their feet, but not get them to the exact same point as
before the disaster. He clarified that there is no double
dipping into both state and federal assistance.
Representative Gara asked for those that were unable to be
helped would there be any benefit or substantial cost to
making this bill retroactive to January 1, 2009.
9:38:57 AM
Mr. O'Hare replied that those that only qualified for the
small amount were helped by volunteer and local groups. He
felt comfortable that they have been helped as best as
possible. Those individuals have not been made whole, but
they are recovering and progressing.
Representative Salmon inquired if the state pays any part
when a federal disaster is declared. Mr. O'Hare replied
that federal regulations cite that the state is responsible
for paying 25 percent of the recovery costs. Representative
Salmon asked if that was 25 percent of $30,000. Mr. O'Hare
replied that would be correct. He added that it does not
just cover the public assistance grants. If there is a
federally declared disaster the public and individual
assistance grant covers a much larger area.
9:41:07 AM
Representative Salmon inquired about the bigger costs, such
as power and roads, and wondered how those costs were
determined. Mr. O'Hare replied that they worked in
partnership with FEMA to arrive at the best economic
program to restore the critical infrastructure. He noted
that in Eagle there was an effort to get people out of the
way of future flooding paths. They have also worked with
the local power companies to not only restore services, but
prevent flood damage from happening again.
9:42:18 AM
Representative Joule remarked that this bill helps the
department to react to a disaster a little better. He
wondered if there are resources to help better planning so
the need to react is not as great. Mr. O'Hare reported that
the federal government does provide the division with
planning specific money from Homeland Security and FEMA to
go out into the communities to help them be better prepared
to respond. There have been many planning regional
workshops implemented to make them better prepared.
Mr. Pierre used the 2009 spring floods as an example and
noted that staff was sent to villages before the flood hit
to see what the effect might be and help the community to
be prepared.
Co-Chair Stoltze closed public testimony.
Co-Chair Stoltze referred to the new revised fiscal note.
9:45:00 AM
Mr. Pierre explained the fiscal note changes. He noted that
the money that goes to disaster grants comes out of the
disaster relief fund. The previous fiscal note showed an
increase of $900,000 total that would be spent as a worst
case scenario. He noted that realistically only about 30
percent of the applicants get the maximum mount so it will
never be the $900,000 increase that was shown. He
emphasized that no new funds were needed at this time to be
appropriated for the bill from this committee.
9:47:23 AM
Vice-Chair Thomas MOVED to report HB 292 out of Committee
with individual recommendations and the accompanying new
fiscal note. There being NO OBJECTION, it was so ordered.
HB 292 was REPORTED out of Committee with a "do pass"
recommendation and with a new zero fiscal note.
ADJOURNMENT
The meeting was adjourned at 9:48 AM
| Document Name | Date/Time | Subjects |
|---|---|---|
| 02 HB 291 Vets Bonds Sponsor Statement[1].pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 291 |
| Federal Veteran DefinitionL.pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 291 |
| HB 291 Updated AHFC Vets Loan Activity[1].pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 291 |
| HB 291 VetsL Sec Analysis.pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 291 |
| HB292 Gov letter hb 292[1].pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 292 |
| Hb 292 Statute history[1].pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 292 |
| HB 292 NEW FN DMVA 03242010.pdf |
HFIN 3/24/2010 9:00:00 AM |
HB 292 |