Legislature(2011 - 2012)HOUSE FINANCE 519
02/29/2012 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB252 | |
| HCR24 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 252 | TELECONFERENCED | |
| *+ | HCR 24 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 29, 2012
2:08 p.m.
2:08:27 PM
CALL TO ORDER
Co-Chair Stoltze called the House Finance Committee meeting
to order at 2:08 p.m.
MEMBERS PRESENT
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Co-Chair
Representative Anna Fairclough, Vice-Chair
Representative Mia Costello
Representative Mike Doogan
Representative Bryce Edgmon
Representative Les Gara
Representative David Guttenberg
Representative Reggie Joule
Representative Tammie Wilson
MEMBERS ABSENT
Representative Mark Neuman
ALSO PRESENT
Joe Michel, Staff, Representative Bill Stoltze; Joshua
Walton, Staff, Representative Mia Costello; Barry
Creighton, President, Ionia, Inc., Kenai; Cathy Creighton,
Ionia, Inc., Kenai; Darren Snyder, Board Member, Alaska
Food Policy Council; Leslie Houston, Director, Division of
Administrative Services, Department of Corrections; Joe
Balash, Deputy Commissioner, Department of Natural
Resources; Ray Riutta, Executive Director, Alaska Seafood
Marketing Institute, Department of Commerce, Community and
Economic Development.
PRESENT VIA TELECONFERENCE
Adam Krynicki, Intellectual Property Specialist, Office of
Intellectual Property and Commercialization, University of
Alaska Fairbanks, Fairbanks; Tyler Arnold, Co-Founder,
Simply Social, Anchorage; Allan Johnston, Chief
Encouragement Officer, The Entrepreneurs and Mentors
Network Inc., Anchorage; Johanna Bales, Deputy Director,
Tax Division, Department of Revenue, Anchorage; Bryce
Wrigley, Alaska Farm Bureau, Delta Junction; Danny
Consenstein, State Executive Director, Farm Service Agency,
United States Department of Agriculture, Anchorage.
SUMMARY
HCR 24 STATE FOOD RESOURCE DEVELOPMENT GROUP
HCR 24 was HEARD and HELD in Committee for
further consideration.
HB 252 INCOME TAX EXEMPTION
HB 252 was HEARD and HELD in Committee for
further consideration.
HOUSE BILL NO. 252
"An Act exempting certain small businesses from the
corporate income tax; and providing for an effective
date."
2:09:14 PM
REPRESENTATIVE MIA COSTELLO, SPONSOR, introduced HB 252 and
explained that the intent of the legislation was to take
advantage of federal law and incentivize investment in fast
growing companies. Currently, federal law allowed an
investor to be exempt from capital gains tax on money that
was invested in this type of company if the funds were
invested for five years. She related that the intent behind
the federal law was to encourage investment in certain
types of fast growing, qualifying companies. She pointed
out that qualifying companies could be based anywhere and
were not targeted to a particular geographic region of the
world; the intent of the bill was to bring investment
dollars to Alaska by creating a tax incentive for companies
under a certain size. She stated that Alaska did not
currently have many fast growing, smaller companies, but
that bringing them to the state would grow and diversify its
economy.
2:12:00 PM
AT EASE
2:13:01 PM
RECONVENED
2:13:03 PM
Vice-Chair Fairclough MOVED to ADOPT the proposed committee
substitute for HB 252, Work Draft 27-LS1085\D (Nauman,
2/29/12) as a working document.
2:13:14 PM
Co-Chair Stoltze OBJECTED for the purpose discussion.
JOE MICHEL, STAFF, REPRESENTATIVE BILL STOLTZE, discussed
two changes in the committee substitute, version D. The
first change, found on page 2, lines 11 and 12, removed the
words "qualified small businesses." The second change was
found where line 12 would have been and designated that the
words "qualified small businesses" had a meaning given in
Section 1202 of the Internal Revenue Code, which was found
in Title 26 of the United States Code, as that section read
on January 1, 2012, as not including a construction,
transportation, utility, or fisheries business.
Co-Chair Stoltze queried if the changes in the committee
substitute had a substantive effect in fiscal costs. Mr.
Michel replied in the affirmative and related that
eliminating a number of small businesses that did not
qualify for the change would reduce the amount of audits
that the Department of Revenue (DOR) would need to conduct
regarding the proposed legislation.
Co-Chair Stoltze requested an explanation of the
substantive changes to the bill structure. Mr. Michel
explained that originally, DOR would have needed to assign
three auditors in order to administer the proposed change,
but that due to the elimination of some types of qualifying
businesses, the department had indicated that it would need
only one auditor.
Vice-Chair Fairclough inquired if the revised fiscal note
had been given to the committee.
Co-Chair Stoltze requested that the updated fiscal note be
distributed to committee members.
2:15:32 PM
AT EASE
2:18:48 PM
RECONVENED
Mr. Michel discussed the updated fiscal note for HB 252 and
related that it reflected the changes in the new committee
substitute. The note added a new position and showed that
there would be no change in revenue to the state.
2:19:33 PM
Co-Chair Stoltze WITHDREW his OBJECTION. There being NO
further OBJECTION, Work Draft 27-LS1085\D was ADOPTED.
Representative Edgmon observed that the fiscal note did not
point to any generated revenue, but offered that this was
because the department was unwilling to project the impact
of the bill that far forward.
Representative Costello requested a clarification of
Representative Edgmon's comments. Representative Edgmon
reiterated his comments and pointed out that new revenue
would be generated by bill because it would have a positive
effect. Representative Costello responded in the
affirmative and voiced agreement.
ADAM KRYNICKI, INTELLECTUAL PROPERTY SPECIALIST, OFFICE OF
INTELLECTUAL PROPERTY AND COMMERCIALIZATION, UNIVERSITY OF
ALASKA FAIRBANKS, FAIRBANKS (via teleconference), spoke in
support of the legislation. He related that the University
of Alaska Fairbanks performed approximately $120 million a
year in research, which resulted in amazing discoveries. He
discussed the university's research efforts regarding
Alzheimer's disease, sudden infant death syndrome, and
unmanned aerial vehicle components. He shared that the
Alaska Center for Energy and Power had produced discoveries
in energy solutions and road construction. The Office of
Intellectual Property and Commercialization was part of a
new effort to create economic opportunities from new
discoveries. He related that patenting, building, testing,
and commercializing viable technologies took significant
investment, without which most ventures could not get
started. He concluded that HB 252 encouraged the private
sector to invest in Alaskan technologies and that it highly
incentivized investment in Alaskan qualified small
businesses that used those technologies.
Co-Chair Stoltze asked whether the testifier was speaking
on behalf of the University. Mr. Krynicki responded in the
affirmative.
JOSHUA WALTON, STAFF, REPRESENTATIVE MIA COSTELLO, relayed
that Mr. Tyler Arnold had submitted video testimony.
Co-Chair Stoltze noted that Representative Gara had joined
the committee.
2:23:52 PM
TYLER ARNOLD, CO-FOUNDER, SIMPLY SOCIAL, ANCHORAGE (via
teleconference), testified in support of the legislation
via video and shared that the bill would make it easier for
startup businesses to be based in Alaska. He related that
his company was a global 1202 C corporation that was based
in Alaska. He stated that Alaska had one of the highest
state corporate income tax rates in the country and that
the legislation would not only remove the burden of high
tax rates, but would increase the state's global
competiveness. He related a story about his business
history in Alaska and his new startup business, Simply
Social.
ALLAN JOHNSTON, CHIEF ENCOURAGEMENT OFFICER, THE
ENTREPRENEURS AND MENTORS NETWORK INC., ANCHORAGE (via
teleconference), vocalized support for the legislation. He
pointed out that Alaska was missing many tools that did not
fit the state's business model; Alaska did not have a small
business investment company (SBIC), a venture capital
company, or an organized angel network. He observed that
Alaska was the only state in the country without an
organized angel network and offered that the legislation
was a tool that would help the state make up for other
missing tools. He related that the bill would make Alaska
the most competitive state in the nation, tax-wise, for
these types of high-growth businesses. He observed that
many emergency room physicians were attracted to Alaska
because of its outdoor lifestyle and opined that the state
had a great opportunity to target high-end individuals.
Vice-Chair Fairclough inquired what an angel network was.
Mr. Johnston replied that an "angel investor" was a U.S.
Securities and Exchange Commission term for a person who
was well-off financially and had either $200,000 in income
for the last two years or $1 million in net worth. Angel
investors could afford to make investments in companies and
could afford to lose their money. He stated that
entrepreneurs generally wanted angel investors in order to
help reduce business risk. He pointed out that the fastest
growing demographic in Alaska were individuals that were
over 50 years of age and that many people qualified to
become angel investors but did not know how it worked. He
concluded that the bill would help organize people to learn
how to become angel investors.
2:31:13 PM
Vice-Chair Fairclough inquired if angel investors were
wealthy people who were willing to invest in smaller
companies and provide less risk to businesses, while taking
risk themselves. Mr. Johnston responded that angel
investors were people who invested on a regular basis in
someone else's business and related that in Alaska,
investors had a tendency to invest in their own businesses.
He shared that the idea behind angel investing was that the
investor generally did not want to control or own the whole
company, but instead preferred diversity. He stated that
there were 300 individuals who contributed $1,000 per year
to the University of Alaska Anchorage and opined that most
of these donors would be qualified as an angel investor. He
related a hypothetical scenario of how university donors
could become angel investors and encourage business growth.
He shared that angel investing took advantage of the
experience of individuals who had retired and were part of
the long-term infrastructure of Alaska by getting those
individuals engaged in the community. He stated that
engaging and organizing the experience of leaders with
Alaska's youth and the leaders of tomorrow was critical. He
concluded that every other state had an organized angel
network for sharing experience and references and that the
legislation would help enable the establishment of such a
network in Alaska.
Representative Wilson inquired if DOR knew how many
businesses would qualify under the legislation and how much
loss in revenue it would represent to the state.
2:35:05 PM
JOHANNA BALES, DEPUTY DIRECTOR, TAX DIVISION, DEPARTMENT OF
REVENUE, ANCHORAGE (via teleconference), explained that
there were three requirements in order to qualify under the
legislation. The first requirement was being engaged in a
qualified small business, which was a narrow category. The
second requirement was that a business must have $50
million or less in aggregate assets. The third requirement
was that 80 percent of the total assets must be used
actively in the business. She stated that the department
could examine corporate income tax returns and could
determine the first two requirements, but that it was very
difficult to determine the third requirements, which was
how companies used assets. She stated that the numbers were
indeterminate at the current time, but that the department
expected it to be, as far as existing corporations were
concerned, fairly narrow.
Representative Wilson requested a ballpark figure that
assumed the businesses qualified for the first two
requirements. Ms. Bales responded that there would probably
be 300 to 400 very small companies involved and that the
department would have to examine how those companies were
using assets. She reiterated that the companies were very
small and that the department did not have information
regarding their revenues.
Representative Wilson indicated that she supported the
bill, but expressed caution. She queried if the department
knew how much the 300 or 400 companies currently paid in
corporate taxes. Ms. Bales replied that the department had
a general idea of the revenues of the companies, but had
only examined one year of information and the amounts
varied greatly. She observed that due to losses and other
factors, some of the qualifying companies did not pay any
taxes and that it was difficult to determine the exact
taxes paid if the companies had carried forward losses.
Co-Chair Stoltze CLOSED public testimony.
Representative Doogan inquired whether a larger corporation
could form a subsidiary, which met the qualifications, in
order to take advantage of the program. Mr. Walton pointed
to a provision in Section 1202 of the Internal Revenue
Code, which dealt with subsidiaries. He stated that the
legislation treated parent and subsidiary corporations as
one entity. When combined, the parent and subsidiary
companies had to be below the $50 million aggregate gross
assets cap in order to qualify under the legislation;
furthermore, both the parent and subsidiary would also have
to be involved in one of the qualifying trades or
businesses, as well as meet the 80 percent working asset
requirement.
2:39:44 PM
Representative Doogan wondered why DOR was unable to make
an estimate on the potential revenue loss if the bill was
enacted. He inquired if the bill sponsor had a better idea
of what the potential losses might be. Mr. Walton replied
that it was difficult to determine the potential losses in
revenue that would result from the bill's passage, as DOR
had previously stated. He indicated that through
discussions with DOR, numbers that were based on different
criteria had been "drilled into," but that the 80 percent
working asset requirement made calculations very difficult
because DOR did not track that information in as much
detail as the first two requirements. He shared that based
on the other criteria, there were a number of sectors that
may be able to apply for the exemption, but that
eligibility for the exemption would be determined by a DOR
auditor; this was the reason there was a position for an
auditor in the fiscal note.
Representative Doogan was not comfortable with unknown
costs as a matter of policy. He opined that if 400
companies fit the requirements and received $10 million,
the bill would represent a lot of money. He was surprised
that the department could not provide a better estimate on
the potential losses in revenue. He offered that it did not
instill confidence in him that DOR was unable to determine
the fiscal impact.
Representative Doogan inquired how confident the state was
in determining the bill's $50 million asset requirement,
given that it was unable to determine how many companies
were affected by the legislation. Mr. Walton replied that
the $50 million in assets was something that corporate tax
payers filed with as part of a corporate income tax return
to the state of Alaska; as a result, it was a category that
DOR had a pretty good handle on. The department was able to
determine how many companies were below the $50 million
gross asset cap and also had some ability to examine the
industry criteria in Section 1202 of the Internal Revenue
Code and eliminate certain industries; however, what was
being done with a company's assets was not reported to DOR.
He stated that the intent of the legislation was to promote
smaller, startup businesses by tying into the federal tax
provisions; the federal tax provisions were used because
they had been shown to be successful at encouraging those
types of businesses. He mentioned that through extensive
searching, the sponsor was unable to find a single example
of a Section 1202 C corporation in Alaska. He observed that
he was not saying that no companies could qualify for the
exemption, but that the definition for a qualified small
business under Section 1202 was more geared toward allowing
qualifying companies to issue stock, which was exempt to
capital gains tax. He shared that the sponsor had adopted
the definitions of the qualified small businesses, which
must meet particular criteria. He stated that a typical
Section 1202 C qualifying small business tended to be in
the technology, research and development, biotech,
pharmaceutical, telecommunication, or information services
and software industries.
2:45:56 PM
Vice-Chair Fairclough directed the committee's attention to
page 88 of the Department of Revenue's Revenue Sources Book
and noted that it listed the income to state from general
corporate tax, as well as petroleum corporate tax. She
offered that the Revenue Sources Book showed that in 2011,
the state received $157 million in general corporate income
tax and $542 million from petroleum related corporate
income tax. She noted that the Revenue Sources Book figures
gave the committee an outside number.
Co-Chair Stoltze offered that Vice-Chair Fairclough was
referencing $157 million of income to the state if all the
companies listed fell under the $50 million gross aggregate
assets cap.
Vice-Chair Fairclough pointed out that petroleum income
would not apply to the bill because those companies would
be over the $50 million asset limit.
Mr. Walton provided some of the exclusions that were
already in the federal tax code in order to inform the
committee what industries would not qualify under the
legislation. He related that under Section 1202 of the
Internal Revenue Code, which was found in Title 26 of the
United States Code, the performance of services in the
following industries were excluded: health, law,
engineering, architecture, accounting, actuarial science,
performing arts, consulting, financial services, brokerage
services, or any trade or business where the principle
asset of such trade or business is the reputation or skill
of one or more of its employees. He offered that the last
exception was added to prevent sole proprietors and other
service providers from avoiding taxes and added that
farming, banking, insurance, financing, leasing, and
similar industries were also explicitly excluded in federal
tax code. Also excluded in the federal tax code was
resource extraction, such as the raising or harvesting of
trees, as well as the oil, mining, and gas industries;
restaurants, hotels, motels or similar businesses were
likewise excluded. He pointed out that real estate was not
specifically excluded from the tax code, but that there
were requirements for qualification as to the maximum
amount of real estate holdings; a real estate business
leasing, renting, or selling property did not count towards
the active business requirements for those assets and the
companies were functionally excluded. Regulated investment
firms, real estate investment trusts, real estate mortgage
investment companies, cooperatives, and
domestic/international sales corporations also did not
qualify under the tax code. He added that if a business
held more than ten percent of its net assets in stock in
another corporation, it did not meet the 80 percent asset
in the active conduct of business requirement. With the
adoption of the new committee substitute, the legislation
also expressively excluded the construction, utilities,
transportation, and fisheries industries. He mentioned that
there were a broad range of industries that were
specifically included and could not qualify under any
circumstance. He related that through discussions with DOR,
his understanding was that under the legislation, the
sectors that may still qualify included manufacturing,
retail, wholesale, and other sectors.
2:49:50 PM
Representative Doogan understood that DOR needed to conduct
audits on expenditures in order to make sure the expenses
conformed to the tax code and the legislation, but wondered
whether the department would be required to publish the
information in order to enable the committee to keep track
of the issue.
Mr. Walton responded that as the bill was currently
written, it did not have an explicit reporting requirement,
but pointed out that when a corporation filed for its
corporate income tax, it was required to include its
federal income tax return. Qualifying corporations needed
to indicate eligibility for exemptions on their federal
returns; at this time, the information would be available
to the state. He mentioned that there were confidentially
requirements and that tax payer, as well as corporate tax
payer information could not be shared in a way that exposed
the internal financial dealings of individual companies;
however, in some cases, such as with C corporations, the
companies were publicly listed and may be required to
report through the U.S. Securities and Exchange Commission.
Representative Doogan expressed that he would feel more
confident if the bill included an audit provision. He noted
that the legislation entered "fresh territory," but that
the state had only a rough idea of what the result would
be.
Vice-Chair Fairclough pointed out that the existing Alaska
Statutes explicitly stated that all corporations that were
members of the same parent/subsidiary control group shall
be treated as one corporation. She directed the committee's
attention to line 22, Section 5 of legislation and noted
that it stated that Section 3 took effect July 1, 2023; she
inquired if this was because the federal code was ending at
that date. Mr. Walton responded that line 22, Section 5 of
the bill provided a sunset date. Section 3 returned the
statutes that were altered by the bill to the original
language. He stated that Section 4 specified that Sections
1 and 2 take effect July 1, 2012. Section 5 specified that
the language in the statutes would revert back on July 1,
2023 to what it had originally been.
Vice-Chair Fairclough believed it was a complicated sunset
provision and clarified that the bill would sunset about 10
years after the law took effect. Mr. Walton responded in
the affirmative and stated that the sunset date was 11
years from the effective date, but that the exemption could
not be claimed until the beginning of January, 2013. He
stated that the sponsor wanted the bill to have at least 10
full years before its sunset in order to see the
legislation's effect. He concurred with Vice-Chair
Fairclough regarding the complexity of the sunset
provision.
2:54:22 PM
Vice-Chair Fairclough agreed with the comments of
Representative Doogan regarding the benefit of the state
receiving a report on the legislation in a few years in
order to see who was accessing it. She pointed out that the
state was forgoing revenue and was not decreasing it. She
opined that it would take some time for regulations to be
written in order to enable the department to ascertain if
80 percent of the assets were being used for a particular
corporation. She believed that there may be some pushback
from companies that were trying prove the 80 percent use of
their assets. She offered that the legislation was
worthwhile and that it might help younger minds, which may
be more IT savvy, to "put packages together"
internationally. She mentioned the video presentation by an
Alaskan who was doing business in Romania and concluded
that the legislation seemed like an opportunity to try and
move forward; however, she requested that a report on
program be presented in the future. She offered that three
years may be the wrong point at which to conduct a report
because it would take a year to write the regulations and
inquired what timeline the department expected regarding
the regulations. Ms. Bales responded that it would take
approximately six to eight months for the department to
draft the regulations; however, because the legislation
piggy-backed the federal code, the department would also
count on the federal regulations to assist in administering
the bill.
Vice-Chair Fairclough asked for a repeat of the time frame
regarding the regulations. Ms. Bales replied that it would
be approximately six to eight months.
Representative Edgmon pointed out that the department
estimated that the bill would bring 300 to 400 businesses
to Alaska and inquired if the new businesses would be
primarily smaller information technology companies, which
came to the state because of the tax credit. He further
inquired if the companies would be big enough to pay taxes
at some point and have audits conducted. Mr. Walton
responded that his understanding of what Ms. Bales had
previously expressed was that the 300 to 400 businesses
were companies that were already in Alaska and may be
eligible to receive the exemption immediately. The
intention behind the bill was to encourage companies in
sectors where there were a low number of businesses. He
reiterated that the sponsor had looked for existing 1202 C
corporations in Alaska, but had been unable to locate any
and mentioned that Mr. Arnold, who had had given the video
testimony, intended to structure his business in Alaska as
a 1202 C corporation. He concluded that the bill's
intention was to exempt revenue that the state was not
currently receiving in order to attract businesses that
would grow to become corporate tax payers.
Representative Edgmon queried if the bill was intended to
not only attract businesses to the state, but also to
attract angel investors and an angel network to Alaska. Mr.
Walton responded in the affirmative and that the current
federal tax provisions encouraged investment. He pointed
out that there were venture capitalists and angel investors
in Alaska, but that it was difficult to find investment
vehicles in the state. He opined that Alaska, in some ways,
was good place to start a small business, but that it was
not a friendly place to start a small business that was a C
corporation. He stated that C corporations could issue
multiple shares of stock and could have an unlimited number
of investors; these types of companies could attract a lot
of capital for financing and had a good ability, once
started, to grow large. He offered that small businesses in
Alaska were usually started as S corporations, sole
proprietorships, or limited liability companies (LLC);
these structures were referred to as "pass-through
entities" and under them, the corporate tax liability was
passed to the owners as personal income tax liability. He
offered that in a state without a personal income tax,
pass-through entities could be very attractive. If an
investor wanted to start a business that could be traded on
the stock exchange, it needed to be started as a C
corporation. Once a C corporation reached $90,000 per year
in income, it was already in the 9.4 percent tax bracket,
which was the fifth highest bracket in the country. He
discussed anecdotal evidence of Alaskan entrepreneurs who
were investing in starting companies in Montana because of
that state's lower tax rate. He offered that Alaskan
investors would probably prefer to start businesses in
Alaska, but pointed out that the state's tax rates had such
a negative impact on the business plans of startup
companies. He stated that statistically, for every ten
small businesses that were started, there would be one left
standing after five years. He concluded that the sponsor's
intent with HB 252 was to make it easier for qualified
businesses to start and grow, as well as to provide an
investment vehicle for Alaska's venture capital sector.
3:03:11 PM
Representative Edgmon surmised that the purpose of the
legislation was multifold and that it grew Alaskan
fledgling industries, while also bringing in venture
capital. He inquired if an Alaskan corporation must consist
of a small group of individuals, rather than a sole
proprietor in order to qualify under the legislation. Mr.
Walton replied that it was possible for a sole proprietor
to begin a business and structure it as an LLC, sole
proprietorship, S corporation, or a C corporation; not all
of these structures would fit very well in the case of a
sole proprietorship. He observed that it was much more
complicated to start a C corporation and that starting one
would only be done if the desire was to get more
sophisticated stock offerings and have a lot of owners. He
stated that an S corporation was limited to 100
shareholders and that they had to be individuals and could
not be companies. He shared that most venture capitalists
did not invest their personal money, but instead created a
firm to serve as a holding company for their assets and let
the firm do the investments; in the case of those firms,
the corporation must be a C corporation or it could not be
invested in.
Representative Edgmon supported the bill, but indicated
that he still had questions regarding Section 3. He stated
that Section 3 discussed the tax not applying to
individuals or fiduciaries.
Vice-Chair Fairclough interjected that the section
Representative Edgmon was referring to was the sunset
provision, which she had previously inquired about.
Representative Edgmon further inquired if Section 3
excluded a corporation that was individually owned. Mr.
Walton responded to the question and stated, "that's the
way that the law exists now, which would be changed by the
bill and revert back to that language." [The wording "that
language" was made in reference to Section 3 of the bill.]
Co-Chair Stoltze observed that there was some complexity in
the bill and that it was his intention to give the
committee a chance to think about it overnight.
Representative Gara supported the concept of the bill. He
related that he liked startup businesses, but that there
were few incentives in Alaska to encourage those types of
businesses. He pointed out that he was a co-sponsor of the
legislation, but related that he had several questions. He
noted that in Alaska, only C corporations currently paid a
corporate tax and that if an investor was trying to avoid
taxes and could set up as an LLC or an S corporation, they
did so. He related that he was an owner of a restaurant and
was a LLC member. He explained that being an LLC member
meant that there was a main person who ran the business and
made the decisions over the other investors; investors like
himself could invest money in the business, but did not run
it. He inquired why the LLC structure would not be perfect
for angel investors. He explained that under the LLC
structure, there were one or several people that were
actually running the company, there were many investors,
and there was no corporate tax. He inquired why the LLC
structure did not allow and attract startup businesses, as
there was not a tax on LLCs in Alaska. Mr. Walton responded
that the answer depended on what was planned to be done
with the business afterwards. For instance, a restaurant
structured under a C corporation could expand to multiple
branches and not start "bumping up against some of the
limits of the LLC business structure." However, if a
restaurant wanted to issue and trade stock, the structure
of the business would need to be changed from a LLC to a C
corporation because the LLC structure limited the amount of
capital that could be brought into a company. In the case
of an S Corporation, corporate income tax was shifted to
personal income tax. He observed that the problem with an S
corporation was that it was limited to 100 shareholders,
who must to be individuals.
3:09:13 PM
Representative Gara provided an example related to a law
firm. He shared that a law firm did not have much assets in
the form of equipment, but made a lot of money. He opined
that a law firm might have less than $50 million in assets,
but that it had high money making potential. He expressed
concern that it would be difficult to tax companies under
the asset criteria and wondered whether there should be a
limitation, which specified that once a company had earned
certain amount of profits, it was required to pay some tax.
Mr. Walton responded that he was unable to provide a
definitive answer. He related that generally speaking, the
types of business that started as C corporations were
looking to produce something. He explained that the law
firm example worked well because the firm provided services
and that the costs associated with a law firm might only
consist of a place to house the offices that provided the
service. He related that C corporations were often
producing something and that investment in assets was
required to create the product. He concluded that the
problem, which was brought to light by the law firm
example, was not really characteristic of C corporations;
however, he would gather more information regarding the
possible extent to which it could characterize C
corporations.
Representative Gara wondered if there had been any
discussion regarding whether a tax should be imposed on a
qualifying company after a certain number of years. He
pointed out that the wholesale and retail industries were
covered by the legislation and inquired whether wholesale
liquor stores could take advantage of the legislation. Mr.
Walton replied that he did not believe that wholesale
liquor stores were exempted under the legislation, but that
he would follow up with a definitive answer. He shared that
the retail and wholesale businesses were not excluded
because the sponsor wanted to attract businesses that were
selling a product and did not want to adopt broad
restrictions, which might exclude the retail and wholesale
sectors.
3:13:00 PM
Representative Gara stated that the bill should have a
cleaner sunset clause. Co-Chair Stoltze interjected that
the sunset clause was one of the reasons that the
legislation would be held for a day or more and noted that
it was the committee's desire to create a substantive piece
of legislation.
Vice-Chair Fairclough queried whether the $50 million asset
cap was created at the state level or whether it currently
existed under Section 1202 of the federal code. Mr. Walton
replied that the number came directly from the Internal
Revenue Code.
Vice-Chair Fairclough inquired if an "Alaska corporation"
under the legislation meant that the business was in Alaska
or that it was simply incorporated in the state. Mr. Walton
responded that initially, the requirement had been that the
company had to be headquartered in Alaska, but that the
Department of Law (DOL), via DOR, had expressed concerns
that the requirement may violate the Interstate Commerce
Clause and equal protection. In response to concerns from
DOL, the requirement of headquartering in Alaska was
removed from the legislation. He explained that the
exemption removed corporate income liability, but that
there was no liability for business activities that were
conducted out of Alaska. He stated that if a company
incorporated in Alaska but did not conduct business here,
it did not incur corporate income tax liability in the
state. He offered that there were cases in which
corporations would incorporate and do business somewhere
else because of beneficial legal provisions in another
jurisdiction. He concluded that the exemption did not help
companies that were incorporating in Alaska and doing
business in another state because they would not be
generating any liability.
Vice-Chair Fairclough surmised that the bill created a tax
shelter for investment up to $50 million, which required
the investors to "keep the assets rolling." She pointed out
that the legislation encouraged investors to invest in
something in Alaska and that it enabled angel investors to
put their assets to work and forego the tax expense. She
observed that based on the federal code, the threshold cap
for qualification was set at $50 million in assets instead
of using another method. Mr. Walton responded that the
extent of the tax shelter for investors was provided in the
federal code, which provided all the benefits for
investments. He offered that the bill created a tax benefit
for startups in Alaska and opined that generally, a tax
shelter referred to a measure with the purpose of defraying
an income tax or tax liability that already existed;
however, the bill did not have that effect. He stated that
the legislation simply exempted the corporations in the
non-prohibited areas, as well as the types of businesses
that the sponsor was trying to promote in Alaska. He
furthered that if investors were using Alaska's businesses
as a tax shelter, they did so under the auspices of the
federal code.
Co-Chair Stoltze referred to the concerns and questions
that were raised regarding HB 252 and encouraged committee
members to work with the sponsor on possible changes to the
legislation. Representative Costello responded that she
welcomed comments and would work with members of the
committee on the bill.
3:17:36 PM
HB 252 was HEARD and HELD in Committee for further
consideration.
Co-Chair Stoltze handed the gavel over to Vice-Chair
Fairclough.
3:17:47 PM
AT EASE
3:19:44 PM
RECONVENED
HOUSE CONCURRENT RESOLUTION NO. 24
Relating to the establishment and operation of a state
food resource development working group.
3:19:44 PM
Representative Wilson MOVED to ADOPT the proposed committee
substitute for HCR 24, Work Draft 27-LS1383/A (Bannister,
2/16/12) as a working document.
Representative Doogan OBJECTED for the purpose of
discussion.
REPRESENTATIVE BILL STOLTZE, SPONSOR, explained that the
resolution was a broad ranged approach that attempted to
improve the local purchases of Alaskan wild caught seafood
and agricultural products. He offered that although the
legislation was only a resolution, it already had support
within the administration. The legislation worked to
encourage existing agencies to work together to enhance
food security in order to improve the amount of wild
Alaskan seafood and agricultural products that people were
buying, without the creation of a lot of new programs. He
opined that one of the failures of agriculture in Alaska
had been too much innovation and expansion and offered that
this was true of fish plants, dairies, and silos. He stated
that Alaska had a lot of good, hard-working fisherman and
farmers who knew how to harvest from the seas and land. The
resolution was an attempt to encourage the state to do more
with its resources. He discussed including nutritious food
in classrooms and offered that the state had already
"ceded" nutrition when Taco Bell and Pizza Hut were both
accepted vendors in schools. He shared his view that
Alaskan seafood should be served in schools as often as
possible. He stated that Commissioner Bell from the
Department of Commerce Community and Economic Development
had indicated that the application of the resolution was
doable. He suggested that due to the nature of bureaucracy,
state agencies often did not communicate well with each
other and that the legislation was an effort to develop and
purchase more Alaskan products in order to get better food
into the state's pantries, school programs, and food-
security warehouses. He believed that the opportunities
were "boundless" and pointed out that the legislation was
not currently requesting any funding.
3:24:46 PM
Co-Chair Stoltze related that he had benefited from serving
on the Alaskan Seafood Marketing Institute for eight years,
as well as from representing an agricultural district that
contained large and small farmers. He discussed the high
quality of agricultural products from his district and
shared a personal story about a trip to Barrow. He observed
that there was a possible market in Barrow for Alaskan-
grown carrots during the winter. He discussed integrating
Alaskan food with the Department of Corrections'
dormitories and shared the value of the state buying its
own products. He stated the importance of having an
integrated plan that would get the state's commissioners to
work together to promote Alaska's local seafood and
produce. He observed that the larger amount of economic and
year-round value would be in Alaskan seafood, but that the
resolution would be a big win for the state's growers as
well. He offered that the Alaskan agricultural industry
could grow more, but that it needed to develop markets
before it expanded. He concluded that Alaska had smart,
capable, innovative, and productive fisherman and farmers,
and that the state could do a lot more than it had in the
past. He pointed out that he would like to see Alaskan
seafood and agricultural products in the state's
correctional facilities, universities, and school lunch
programs and stated that he was willing to set aside money
in the capital budget for the creation of a "commodities
food bank." He reiterated displeasure that Taco Bell and
Pizza Hut were served in Alaskan schools.
3:29:03 PM
Representative Guttenberg supported the resolution. He
discussed that in many ways, the state was at a critical
point. He mentioned the loss of federal funding for
Alaska's agricultural research and the "crisis" at the
experimental farm at the University of Alaska Fairbanks. He
inquired how Alaska found itself in the position of a
crisis and commented that the state used to have a robust
agriculture industry. He recalled that mission schools used
to have "huge gardens" and discussed greenhouses that used
to be at various hot springs. Co-Chair Stoltze responded
that he was unsure how the state had de-evolved to such
poor food choices. He mused how society had gotten to the
point where a raw carrot was often a "foreign substance"
for a child. He offered that successful farmers in Alaska
were successful not because of government, but in spite of
it and opined that the Department of Natural Resources'
(DNR) Division of Agriculture could use a lot of
improvement. He furthered that the Division of Agriculture
had carried some "political baggage" over the years and
that it had internal issues. He stated that DNR was
responsible for helping the state produce its minerals,
oil, gas, as well as other land resources and that given
those responsibilities, it had been difficult for the
department to stay focused on agriculture; the difficulties
within the department regarding the promotion of the
state's agriculture was one of the reasons the sponsor had
brought up the resolution. He reiterated that he was
pleased that the administration had embraced the resolution
and mentioned that while it might not be very substantive,
it was a good place to start. The resolution attempted to
get agencies involved and working together. He concluded
that the legislation was not a perfect document, but that
it was a best effort to examine who was involved;
furthermore, it had been successful as a talking point and
a working document.
Representative Edgmon indicated that he would be happy to
work with Co-Chair Stoltze on the resolution. He stated
that he would like regional non-profit associations to be
listed somewhere in the legislation. He mentioned the
Bristol Bay Native Association's work with the local food
bank and nearby schools and talked of trading local foods
within the areas of Alaska. He related that his local
school district had initiated a program whereby local
fisherman donated fresh salmon to local processers, which
was then served every Friday in school. He offered that the
resolution would help promote other programs that were
similar to the fish program in his constituency's school
district. Co-Chair Stoltze agreed that Representative
Edgmon's region gave a lot of good ideas in regard to what
works locally. He discussed visiting with fish processors
from Togiak and spoke of the value of using local
facilities and people in Togiak, rather than building a new
fish plant in Anchorage. He offered that it was a good idea
to give regional producers the economic opportunity of
producing a product.
3:35:39 PM
Representative Doogan WITHDREW his OBJECTION. There being
NO further OBJECTION, Work Draft 27-LS1383/A was ADOPTED.
Vice-Chair Fairclough commented that the locally-grown
carrots from Co-Chair Stoltze's district were some of the
sweetest and most nutritious carrots that could be found in
America. She noted that the local growers were doing a
fabulous job producing carrots. She referenced Alaska's
high rates of obesity, particularly in schools, and opined
that the resolution was a creative idea that would benefit
students, farmers, and fishermen.
3:36:54 PM
BARRY CREIGHTON, PRESIDENT, IONIA, INC., KENAI, spoke in
support of the resolution. He explained that Ionia Inc. was
a non-profit organization that consisted of a group of 25
families who all had history of behavioral health problems;
the families had banded together for peer support and
quickly realized that food was the foundation of their
world. He related that Iona Inc. used simple food, such as
grains, vegetables, or seaweed. He shared that Ionia Inc.
had applied for a grant through the Alaska Science and
Technology and the Alaska Conservation Foundations to find
grain that would grow in Alaska. Through the grant, Ionia
had purchased a tractor and had cleared land. Ionia had
found 40 different heirloom seeds from around the world,
one of which was a barley seed from the Himalayas. The
Himalayan barley had a very short growing season, grew in
poor soil, and flourished in turned-over muskeg without any
assistance. The term "heirloom" meant that a seed had not
been hybridized. He explained that Iona Inc. had produced
over 1,000 lbs. of seed from one seed packet, consumed 800
lbs. of whole grain per month, had cleared 30 acres of
land, and were in the process of building a 12,000 square
foot barn. He furthered that Ionia Inc. had 2,000 feet of
raised garden beds, as well as three 50-foot-long
greenhouses. He related that the group had about 15-20
children in the Connections Homeschool Program. He pointed
out that he had been on the board of the federal health
clinic in Soldotna for the last 10 years and that over that
period, the rates of diabetes and obesity in Alaska had
risen drastically. He offered that food could be used as a
frame of reference to countermeasure some of society's
problems, particularly in the area of mental health. He
shared that many of Ionia Inc. families had used heavy
psychotropic drugs prior to joining the group, but that
after adopting a "food frame of reference", the families
had been drug free for 25 years. He stated that using food
did not cure anything, but that it brought the "symptoms
down the pendulum to idiosyncratic behavior, instead of
socio." He stated that from a fiscal perspective, not one
member of Ionia Inc. spent time at the Alaska Psychiatric
Institute, which had a cost to the state of $1,200 per day.
He offered that Ionia Inc.'s peer support and food had
provided its members with a foundational frame of reference
to approach their problems and achieve a restorative life.
3:40:38 PM
CATHY CREIGHTON, IONIA, INC., KENAI, testified in support
of the resolution and related that Ionia had a dedicated
website. She stated that Ionia Inc. had been growing
healthy food for 25 years in Alaska. She related that the
group had been mostly isolated, but that over the past year
people from the state had been coming to Ionia Inc.
desiring information and cooking classes. She shared that
all the local health organizations were interested in
healthy food, as well as gardening clubs and related that
Iona was no longer alone in its desire for healthy foods.
She opined that Alaskan-grown vegetables were strong,
sweet, and nutritious and had very special qualities. She
discussed Alaska's grass-roots appetite and related that
having the partnership of the government would be
encouraging and beneficial to "this movement." She
furthered that the legislation would be beneficial to
health organizations, the state's economics, as well as
children in schools. She added that Diane Peck, who was the
chair of the Alaska Food Policy Council and an employee of
Department of Health and Social Services, had requested
that the Department of Environmental Conservation be added
to the resolution's list of state organizations.
Co-Chair Stoltze replied that he would take a look at the
resolution.
Mr. Creighton stated that the prior year, the Rasmussen
Foundation had started the Health Food Initiative, which
would serve as a means to deal with health issues across
the state, and related that the foundation was willing to
"pour money" into the initiative.
3:44:23 PM
DARREN SNYDER, BOARD MEMBER, ALASKA FOOD POLICY COUNCIL,
voiced strong support for the resolution. He related that
the resolution recognized the importance of developing a
strong and secure food system that could provide jobs,
support healthy communities, and increase food security to
feed the hungry and insulate the state from potential
disruptions in food supply. Currently, over 130 Alaskans
had joined the Alaska Food Policy Council due to concerns
they had over the food challenges facing Alaska. He shared
that the council consisted of farmers, fisherman, food
banks, subsistence users, school districts, food safety
regulators, processors, educators, families, as well as
others and that the members had realized that more progress
could be made towards healthy Alaska communities by working
together. The Alaska Food Policy Council had developed a
strategic plan to guide positive actions towards
strengthening Alaska's food systems. He shared that HCR 24
and the proposed State Food Resource Work Group were
perfectly aligned with the vision, mission, goals, and
strategies of the Alaska Food Policy Council. He related
that the council was pleased with the inclusion of each of
the departments that were in the legislation, but requested
that the Department of Environmental Conservation be added
because it played a key role within Alaska's food system.
He addressed an earlier question from Representative
Guttenberg regarding how the state had found itself in the
position it was in. He discussed America's lower cost of
food since the 1950s and explained that the Lower 48 had
"priced out" Alaska's ability to compete. He related that
part of the Alaska Food Policy Council's strategic plan
involved strengthening enforcement language in the local
agriculture and fisheries product preference statute, AS
36.15.050; strengthening this statute would incentivize
people to purchase Alaskan products. He related a story
about the famous and successful Anway strawberry, which had
been developed in Haines. He related that the Anway
strawberry had diminished partly because people did not
recognize the importance of a tasty, delicious, and fresh
product and because purchasers had opted for the
convenience of frozen strawberries. He addressed
Representative Edgmon's question regarding the inclusion of
some Native corporations and health consortiums in the
resolution and related that he fully supported that
concept. He concluded that the Alaska Food Policy Council
had worked hard to make sure it had representation for
everyone on its governing board.
3:49:29 PM
LESLIE HOUSTON, DIRECTOR, DIVISION OF ADMINISTRATIVE
SERVICES, DEPARTMENT OF CORRECTIONS, expressed the
Department of Correction's (DOC) support of the resolution.
She discussed that the department had tracked its Alaskan
grown purchases at the end of FY 08 and that the number of
purchases was "not that great," being anywhere from 30,000
to 60,000. She related that in FY 10, Representative
Stoltze had brought DNR, DOC, and some of the Mat-Su Valley
farmers into discussions regarding Alaska purchases; the
meeting had been an education process for DOC, as well as
the farmers regarding the best way to sell products to the
state under DOC's procurement code. After the meeting was
held, the next year's purchasing in FY 11 increased from
30,000 to 60,000 per year; currently, the number of
purchases was at 105,000 per year and the department
expected FY 12's purchases to exceed that number. She
mentioned that the effort to buy local foods had been
successful, the nutritional value of the food was high, and
that inmates within DOC had commented on the quality of the
food. She pointed out that DOC had worked closely with DNR
on local purchasing and that currently, DOC was in the
process of working with the Matanuska Creamery to purchase
cheese. She stated that she was also initiating a process
to start the purchasing of local seafood and concluded that
DOC was fully supportive of the resolution.
Co-Chair Stoltze observed that the state's departments had
been very cooperative in getting the resolution to this
point.
3:51:47 PM
JOE BALASH, DEPUTY COMMISSIONER, DEPARTMENT OF NATURAL
RESOURCES, voiced the department's strong support for the
resolution. He discussed the economical value and food
supply that came with a strong agricultural sector and
related that the department would assist with the
resolution's effort in anyway it could.
RAY RIUTTA, EXECUTIVE DIRECTOR, ALASKA SEAFOOD MARKETING
INSTITUTE, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC
DEVELOPMENT, vocalized the institute's support for the
resolution. He shared that seafood was a "brain food." He
related that there was an increasing trend to buy local and
that the timing for the resolution was right. He stated
that Alaska had great products and that the Alaska Seafood
Marketing Institute (ASMI) was committed to work together
with all the parties that were involved with the
resolution. He pointed out that ASMI was serving 90 lbs. of
Mat-Su Valley carrots at the Boston Seafood Show, where
ASMI would serve seafood to 800 to 900 of Alaska's best
customers.
Representative Wilson asked whether ASMI had sales through
the schools or whether local districts made that
complicated. Mr. Riutta responded that the sales were
primarily handled on a local level, but that ASMI was
currently working on a national level school feeding
program, which would serve Pollock.
Representative Wilson wondered whether the national level
program included Alaskan schools. Mr. Riutta responded that
it should include all schools.
3:54:43 PM
Representative Gara pointed to the less than desirable
school lunches and asked Mr. Riutta to take the issue to
the ASMI board. He related that he would like to see ASMI
file school nutrition legislation in order to have some
real guidelines for food in Alaskan schools. Mr. Riutta
replied that he would take the issue to the board.
3:55:39 PM
BRYCE WRIGLEY, ALASKA FARM BUREAU, DELTA JUNCTION (via
teleconference), expressed the bureau's support of the
resolution and related that it offered a collaborative and
comprehensive effort to address food security in Alaska. He
reported that Alaska imported about 95 percent of the food
it consumed and that the state had a three-day to one-week
supply of food if a transportation breakdown occurred. He
explained that agriculture and fishing were the only two
industries in Alaska that produced food. He related that
the resolution encouraged a collaborative effort between
the Alaska Food Policy Council, the Division of
Agriculture, the Department of Fish and Game, the
Department of Commerce, Community and Economic Development,
the Department of Health and Social Services, the
Department of Military and Veterans Affairs, and the
Department of Education and Early Development. The
legislation also encouraged participation from 4-H, the
Future Farmers of America, the Alaska Farm Bureau, as well
as encouraging research by the University of Alaska. He
furthered that the resolution was an effort to secure food,
improve health, and strengthen Alaska's economy. He
directed the committee's attention to page 1, lines 8
through 10, which showed that Alaska spends $1.5 billion
annually on food; if the amount that Alaska produced
increased by 30 percent, it would represent almost $500
million in additional sales and at least $2 billion of
increased economic activity to the state. He shared that in
2011, the state's oil revenue had been about $5.3 billion
and that $2 billion would represent almost 40 percent of
Alaska unrestricted oil revenue from the prior year. He
opined that the state had focused for a long time on
keeping oil flowing in the pipeline and that it had
forgotten about the importance of producing its own food.
DANNY CONSENSTEIN, STATE EXECUTIVE DIRECTOR, FARM SERVICE
AGENCY, UNITED STATES DEPARTMENT OF AGGRICULTURE, ANCHORAGE
(via teleconference), voiced the United States Department
of Agriculture's (USDA) support for the resolution and
mentioned that he was also a member of the governing board
of the Alaska Food Policy Council, which also supported the
resolution. He offered that the USDA was excited about
being a partner in the resolution and that local food
production was a priority for the department because it
benefited local communities by helping to create jobs,
improving nutrition, and increasing food security. He added
that Alaska was vulnerable to disruptions in its food
supply and related that he was looking forward to being a
partner with the state and its agencies to improve and
strengthen Alaska's food systems.
4:00:20 PM
Co-Chair Stoltze thanked the committee and the public for
suggestions regarding the resolution. He noted that he
tried to be as inclusive as possible when selecting the
legislation's participants and that he appreciated
Representative Edgmon's suggestion. He explained that any
omissions were not intentional and stated that he wanted to
include the Department of Environmental Conservation in the
resolution for the areas that it had a constructive role
in, while still acknowledging that the department had
implemented policies that were not always popular. He
mentioned that he would work to add provisions to the
resolution and would bring it back before the committee at
a future date. He related that he was pleased to see more
people discussing Alaskan fisheries and agriculture
together and offered that there was a constructive spirit
of cooperation towards the goals of better food security
and increasing local, nutritious purchases. He agreed that
Alaskan salmon was a brain food and that Pollock would be a
preferable alternative to serve in tacos for school
lunches.
Vice-Chair Fairclough CLOSED public testimony.
4:03:23 PM
Representative Joule shared that he was excited about the
resolution. He recalled a personal story about living in
the Alaskan communities and related that the community he
was living in would take one day a month in its schools "to
be Inupiat people;" during this time, one of the things the
community brought into the schools was local food. He
shared that families had worked together during the harvest
times and that it was fun to watch families, the community,
and the schools to be able to enjoy the good food. He
related that there were nutritional issues in Alaska's
schools, jails, residential facilities, state hospitals,
and other facilities and that the discussion surrounding
the resolution was great. He stated that years prior, there
had been a funding request for a pilot program that would
have replicated blueberries in Alaska, but that that it had
been vetoed. He related that he often wondered what
possibilities Alaska had lost as a result of the veto. He
observed that he managed the Department of Health and
Social Services' budget and that obesity cost Alaskans
somewhere between $459 million to $477 million per year;
the state's investment to fight that issue was $400,000.
Representative Guttenberg mentioned that there was a new
strain of blueberries that grew in clumps like grapes. He
offered that normally, the problem with harvesting
commercial blueberries was that they fruited in a sparse
pattern; however, an experimental farm in Fairbanks was
working with local farmers on the new blueberries. He
related that there was a lot of research being conducted on
and off university campuses regarding the benefits of
Alaskan blueberries and mentioned that the state's
blueberries contained incredibly high levels of
antioxidants. He shared that agricultural programs outside
of Alaska were requesting samples of the state's
blueberries in order to try to grow them elsewhere. He
stated that hopefully, the secret to Alaska's blueberries
was the state's extended periods of light during the
growing season.
4:07:46 PM
Representative Wilson remarked on the importance of
nutrition in the state's schools. She observed that the
state spent a considerable amount of money on serving
breakfasts and lunches in schools, but that the meals had
very little nutritional value. She offered that the value
in healthy food was found not only in eating well, but also
in learning and teaching others to grow their own food. She
mentioned that the school in Tok already had a greenhouse
on location and that the middle school in North Pole, which
was in her district, was making efforts in that regard. She
concluded that time spent with family and having
nutritional food could not be replaced by a can from a
store.
Representative Gara believed that one of his failings as a
legislator had been that he had never introduced a school
nutrition bill. He opined that if the state was serious
about fighting obesity and creating a market for local
foods, part of the solution had to be standards for school
lunches. He pointed out that school lunches contained
simple carbohydrates, high amounts of saturated fats, and
sometimes trans fats, all of which caused obesity. He
expressed regret that he never carried a bill with better
standards for school lunches and hoped that someone would
introduce such a bill in the future.
Vice-Chair Fairclough discussed a zero fiscal note from the
Legislature. She requested that amendments for the
resolution be submitted to Co-Chair Stoltze's office.
Co-Chair Stoltze requested that suggestions for the
resolution come in the form of concepts or ideas, rather
than amendments. He opined that it would be more efficient
to incorporate changes into a committee substitute. He
reiterated that he was open for ideas and that the
resolution was an inclusive document; however, it would
probably not be quite as open to all comers as the Alaska
Food Policy Council due to certain restrictions and efforts
to keep the document focused. He stated that his office
could figure out how integrate the changes with the
existing language of the resolution.
Vice-Chair Fairclough noted that the Alaska Food Policy
Council's strategic plan was included in member's packets.
4:11:24 PM
HCR 24 was HEARD and HELD in Committee for further
consideration.
Vice-Chair Fairclough discussed the following meeting's
agenda.
ADJOURNMENT
4:12:06 PM
The meeting was adjourned at 4:12 p.m.