Legislature(2009 - 2010)HOUSE FINANCE 519
02/17/2009 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB98 | |
| HB3 | |
| HB20 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 3 | TELECONFERENCED | |
| + | HB 98 | TELECONFERENCED | |
| + | HB 20 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 17, 2009
1:39 p.m.
1:39:22 PM
CALL TO ORDER
Representative Stoltze called the House Finance Committee
meeting to order at 1:39 p.m.
MEMBERS PRESENT
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Vice-Chair
Representative Allan Austerman
Representative Harry Crawford
Representative Anna Fairclough
Representative Richard Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
MEMBERS ABSENT
Representative Mike Hawker, Co-Chair
Representative Woodie Salmon
ALSO PRESENT
Jane Pierson, Staff, Representative Jay Ramras; Anne
Carpeneti, Assistant Attorney General, Legal Services
Section-Juneau, Criminal Division, Department of Law;
Representative Bob Lynn; Dirk Moffat, Staff, Representative
Lynn; Kevin Brooks, Deputy Commissioner, Department of
Administration; Representative Bryce Edgmon; Greg Winegar,
Director, Alaska Division of Investments, Department of
Commerce
PRESENT VIA TELECONFERENCE
Quinlan Steiner, Director, Public Defender Agency,
Department of Administration; Whitney Brewster, Director,
Division of Motor Vehicles, Department of Administration;
Robin Bronen, Executive Director, Alaska Immigration Justice
Project; Matthew Kerr, computer programmer, Anchorage; Kay
Gajewski, Anchorage; Bill Scannell, Anchorage; Krista
Stearns, Assistant Attorney General, Department of Motor
Vehicles
SUMMARY
HB 3 "An Act relating to issuance of identification
cards and to issuance of driver's licenses; and
providing for an effective date."
HB 3 was HEARD and HELD in Committee for further
consideration.
CSHB 20 (FSH)
"An Act relating to commercial fishing loans for
energy efficiency upgrades and increasing the
maximum amount for certain loans under the
Commercial Fishing Loan Act; and providing for an
effective date."
CSHB 20 (FSH) was HEARD and HELD in Committee for
further consideration.
HB 98 "An Act relating to minor consuming and repeat
minor consuming; and providing for an effective
date."
HB 98 was HEARD and HELD in Committee for further
consideration.
1:39:38 PM
HOUSE BILL NO. 98
"An Act relating to minor consuming and repeat minor
consuming; and providing for an effective date."
JANE PIERSON, STAFF, REPRESENTATIVE JAY RAMRAS, presented
the sponsor statement explaining three fixes in the bill.
HB 98 fixes a problem that occurred with the enactment
of HB 359, a bill that passed the House unanimously in
the 25th Legislative Session. HB 359 originated due to
the desire of Alaskan youths to join the military and
not being able to due to probation restrictions from a
minor consuming charge that may have occurred 5 years
previously. Unfortunately, when the bill was drafted,
it left a loop-hole in the repeat minor consuming law.
HB 98 fixes this loop-hole by amending the language of
AS 04.16.050(c) to include in the list of predicate
offenses for repeat minor consuming "previously granted
suspended imposition of sentence", and "a prior
conviction under AS 04.16.050 (b)(2)."
This new language will now cover all repeat offenders,
no matter how their previous minor consuming charges
were adjudicated.
Co-Chair Stoltze requested a summary of the ultimate goal in
passing House Bill 98. Ms. Pierson referred to HB 359 that
states a minor convicted of minor consuming could be taken
off probation in order to join the military, play sports, or
cross into Canada, so their lives would not be placed on
hold because of a mistake. House Bill 98 is a technical fix
to that bill.
Representative Gara questioned what would happen if this
bill passed. He wondered if it was correct that a young
person, with a first time arrest for having a beer, the law
now states they are convicted. Ms. Pierson stated that the
minor may be convicted two ways; first under AS 04.16.050
(b)(1) which grants a suspension of sentence and places the
minor on probation or AS 04.16.050 (b)(2) which imposes a
fine of at least $200 but not more than $600, requires the
minor to attend alcohol information school or be on
probation for up to one year. It further states that the
court may suspend a portion of the fine if the minor is
required to pay for education or treatment.
Representative Gara reminded the committee that when this
bill came before them last year some members wanted to fix
the law, but were met with resistance. He contended that he
disliked the "convicted" language for a 17 year old caught
having a beer. He judged this offense could be settled with
a fine or require education but not use "conviction"
language.
1:45:43 PM
Ms. Pierson replied that under AS 94.16.050 (1) (3) the
statute states that previously convicted to exclude a
conviction for minor consuming, therefore there is some
leeway. Representative Gara emphasized he did not want this
person treated as a criminal and reiterated it should not be
considered a crime. Ms. Pierson replied it would be a crime.
Representative Gara believed the bill needed further
examination.
1:46:50 PM
Representative Austerman expressed the same concern as
Representative Gara. He believed more time was needed to
investigate this bill. Co-Chair Stoltze expressed there had
been intent to pass the bill, but he believed if there were
still questions, the bill needed further examination.
QUINLAN STEINER, DIRECTOR, PUBLIC DEFENDER AGENCY,
DEPARTMENT OF ADMINISTRATION, testified via teleconference,
and affirmed the department would look into the questions
expressed by Representative Gara and Representative
Austerman. Representative Gara contended the statute is
strange in that it is only statute on the books that talks
about probation and a suspended imposition of sentence for
something that does not receive a jail sentence.
1:49:36 PM
ANNE CARPENETI, ASSISTANT ATTORNEY GENERAL, LEGAL SERVICES
SECTION-JUNEAU, CRIMINAL DIVISION, DEPARTMENT OF LAW agreed
that a minor consuming is not a crime for the first and
second time but the word "crime" is used because it is not
clear what else to call it. In 2001 the law was changed for
minor consuming in the state to recognize that minors try
things and should not be tagged with a crime but at present
there is no other label to assign to this offense. Co-Chair
Stoltze asked if this was a semantic issue, calling it a
crime for lack of a better definition. Ms. Carpeneti agreed
it should not be a crime, but crime-related language is
used. Co-Chair Stoltze asked if Ms. Pierson's testimony was
in error. Ms. Carpeneti asserted that the first and second
offenses are not crimes but the third would be a Class B
misdemeanor. Representative Gara asked if language could be
inserted into the statute that said the first two offenses
are not considered crimes. Ms. Carpeneti expressed the need
to look at the statute more carefully before making any
final decisions.
1:51:48 PM
Representative Gara asked if this was the only statute that
had probation and suspended imposition of sentences where
there is no possible jail time. Ms. Carpeneti believed that
was true, but needed to investigate further.
1:52:16 PM
Representative Austerman reiterated he was not trying to
protect the habitual drinker, but he also did not want to
penalize a minor for trying something for the first time.
Representative Joule wondered if citations, something less
than crimes, could be used in this case. Ms. Carpeneti
explained that a citation is a charging or ticketing
document and caution would be needed in using that word, but
it could be considered. Chair Stoltze interjected that this
discussion would depart from Representative Ramras's intent
from a technical fix to a substantive change to an exiting
statute. He would want all interested parties to have a say
before making such a change.
HB 98 was HEARD and HELD in Committee for further
consideration.
1:55:02 PM
HOUSE BILL NO. 3
"An Act relating to issuance of identification cards
and to issuance of driver's licenses; and providing for
an effective date."
DIRK MOFFAT, STAFF, REPRESENTATIVE BOB LYNN expressed that
HB 3 contends that an applicant for an Alaskan driver's
license or identification card be able to prove who they are
combined with legal status presence in the State of Alaska
and that the license expires when their legal presence
expires. He stated if someone can not walk down the street
legally they should not be able to drive.
1:56:39 PM
Representative Gara understood that only legal Alaska
residents or visitors get a driver's license, but he
wondered if the Department of Motor Vehicles (DMV) will now
be screening legal residents and impose hassles for
everyone. Mr. Moffat replied there would be no requirement
for those with an existing Alaska driver's license or
identification card to show any proof; they will be
grandfathered in by the system. He added only new
individuals seeking an Alaska driver's license or
identification card will be required to show a primary
document. This would also apply to those who license or card
has expired over 90 days or has been revoked.
Representative Gara expressed concern that this might be a
backdoor way of implementing the Real ID Act. Mr. Moffat
interjected that had been a major concern of Representative
Lynn. This act does not comply with the Real ID Act because
there is a 90 day grace period, whereas the federal bill
requires everyone to show personal documentary evidence
every time they renew their license. He added that SB 202,
sponsored by Senator Bill Wielechowski, passed last year,
made it against the law for the State of Alaska to cooperate
with the federal government in implementing the Real ID Act.
Mr. Moffat added that when Senator Wielechowski was asked if
HB 3 would affect HB 202, the senator replied it would not
have an impact.
2:00:45 PM
Representative Gara responded that the word "solely" allows
them to implement the Real ID Act. He stressed his greatest
concern was an imposed hassle for Alaskans in order to catch
a few others. He noted that the bill will impact those who
move here and attempt to get a license and those who apply
for license renewal. He offered that there needs to be a
balance against individuals who have done nothing wrong and
a few who may.
Mr. Moffat expressed no desire to punish anyone, but with
existing identity fraud it is important to know anyone
coming to this state is who they say they are. He added that
some other state's requirements are stricter and some more
lenient. When Alaskans get their first driver's license they
must show the proper identification.
2:02:31 PM
WHITNEY BREWSTER, DIRECTOR, DIVISION OF MOTOR VEHICLES,
DEPARTMENT OF ADMINISTRATION testified via teleconference
and addressed three items. She noted that the DMV already
requires when applying for an original driver's license
various forms of identification. This bill does not change
that requirement only expires the license or identification
card when the documentation expires. She also noted that the
DMV is aware of the legislature's stance on the Real ID Act
through HJR 19 and SB 202.
2:04:57 PM
Representative Joule pointed out that in looking over the
regulations on primary and secondary documents there is a
reference to the Bureau of Indian Affairs card or tribal
card (State of Alaska, Division of Motor Vehicles Secondary
Identification documents, page 3, line 2, copy on file). He
questioned if individuals from rural areas of the state who
have not established any of the listed required primary
documents could use the tribal card as a primary source
document.
2:06:35 PM
Ms. Brewster acknowledged she is aware of the issue and is
willing to look at the tribal card as a primary document.
She expressed being unfamiliar how the cards are issued and
what information is provided to create the card.
2:07:18 PM
Representative Joule asked if she would actively pursue
discovering this information. Ms. Brewster replied she would
be interested in talking with Representative Joule's
contacts. Representative Joule responded he would follow up
with appropriate contacts for her.
2:08:43 PM
Co-Chair Stoltze indicated that all the proposed amendments
available for this bill would be faxed to her office.
Representative Gara referred to HB 3, line 14, and asked why
the section that applies to 60 year olds is needed.
2:11:09 PM
Representative Lynn indicated it would be a convenience to
elders and less money to the state in getting a driver's
license or an identification card. Mr. Moffat indicated that
presently identification cards are issued free for those 60
and older and the new card would be recognized for 8 years
instead of five.
2:12:59 PM
Representative Gara supported the intent to make it easier
for seniors, but he did not believe there was expiration for
identification cards. Ms. Brewster reported that there is a
5 year expiration date for identification cards, but the
proposed legislation would provide a courtesy to those 60
and above by extending it 8 years. Representative Gara
questioned why it is necessary for a senior citizen from a
rural area to renew an identification card. Ms. Brewster
answered that it is the law and it was important to make
sure that individuals have the most current identification.
2:14:47 PM
Mr. Moffat elaborated that cards should not last forever
becasue identity theft could occur. Co-Chair Stoltze
indicated that the committee was not sure where to go with
this discussion.
2:16:00 PM
Representative Austerman asked how many people, outside the
scope of this law, are already getting driver's licenses.
Representative Lynn responded that he does not think anyone
knows that answer. Mr. Moffat also did not know that number.
2:17:27 PM
Ms. Brewster explained that the DMV does not keep statistics
of those turned away or have an expired license.
Representative Lynn responded that it would be hard to keep
such data.
2:18:13 PM
Representative Crawford indicated that he was not familiar
with the matricula consular card (HB 3, page 2, line 25).
Representative Lynn explained that matricula consular cards
are issued by the Mexican government declaring their
citizens have a right to be in the United States. Ms.
Brewster remarked that the card is issued by a consulate
without any backup information to verify identity.
Representative Gara mentioned on page 3, line 20, those who
are allowed to be in the country and wondered if this
targeted all permitted people or if there were other
classifications being missed.
2:19:58 PM
Representative Lynn answered legal presence includes those
with unexpired visas, unexpired work permits, green cards,
or amnesty certificates. Ms. Brewster indicated that she had
nothing to add.
2:20:49 PM
ROBIN BRONEN, EXECUTIVE DIRECTOR, ALASKA IMMIGRATION JUSTICE
PROJECT, testified via teleconference, identified her
organization as an Anchorage non-profit group that provides
legal services throughout Alaska for immigrants and
refugees. She expounded that this issue is complex and DMV
was making identity decisions on who can get a driver's
license or an identity card. She noted that most of her
organization's work concerned domestic violence and human
trafficking victims. Since July 2008, her group has worked
with over 150 immigrants who are victims of crimes. They are
often married to US citizens whose responsibility it is to
make sure their immigrant spouse gets the proper immigration
documentation to live and work in the United States. Many of
the women live in remote areas and their inability to get
driver's licenses puts another barrier in their search for
safety and protection. The legislation as it is now written
excludes these immigrants from getting a driver's license or
identity document. Ms. Bronen provided a recent case of a
woman who went to renew her driver's license, was reported
to homeland security by the DMV, and is now caught in
deportation proceedings. Ms. Bronen suggested that the
fiscal note underestimates the true cost. She gave examples
of much higher costs in other states.
2:25:10 PM
Ms. Bronen explained that the matricula consular card is
issued by the Mexican government and does nothing to verify
a person's legal immigration status in the United States.
She added another area of concern is the First Nations
people of Canada who are allowed to enter the United States
pursuant to the Jay Treaty without needing immigration
documents. Under the proposed HB 3 legislation, the First
Nations people would not be allowed to get a driver's
license even though they are legally allowed to be in the
United States.
Co-Chair Stoltze asked Ms. Bronen if she knew how many
illegal immigrants were in Alaska. Ms. Bronen indicated her
organization does not keep track of that information because
her group works with immigrants that are in the process of
getting their legal documentation. The organization is
presently working with 700 immigrants in the process of
getting their legal documentation.
2:26:48 PM
Representative Lynn asked if the people Ms. Bronen is
working with have legal status. Ms. Bronen replied they are
working to get their legal status documentation. The
organization has had 100% success in getting the
documentation.
2:27:24 PM
Representative Gara asked Ms. Bronen about the list on page
3 of people legally allowed to be in the United States and
asked if that covered everyone or if other categories should
be added. Ms. Bronen indicated that many people would be
excluded under this bill. Immigration laws constantly change
and the list would need to be continually modified.
Representative Gara asked if someone could be legally in the
United States, applying for legal status, but not yet
obtained it. Ms. Bronen answered from an immigration legal
perspective, according to the Immigration Nationality Act; a
person who is in the process of acquiring any immigration
documents does not have legal status until the documents
have been approved.
2:29:37 PM
MATTHEW KERR, COMPUTER PROGRAMMER, ANCHORAGE, testified via
teleconference, informed that he is not against the basic
idea of the bill, but the bill does not account for how the
United States immigration law works or the added
consequences of overburdening the DMV. Alaska already has
legal presence requirements implemented requiring proper
immigration documents for foreign license applicants. He
disagreed with the section of the bill that ties the
expiration date of the driver's license or identification
card with the last date of legal presence; people legally or
temporarily in the United States for a long duration
frequently change immigration status. Mr. Kerr noted that
because the legal processing rate for immigrants can be 12
months or longer an applicant should not be punished by
being unable to renew or get a license because of the legal
delay. Mr. Kerr listed some common sense methods to preserve
the full intent of this bill yet streamline the
implementation.
2:34:04 PM
Representative Gara requested Mr. Kerr send some language
and suggestions to the committee.
KAY GAJEWSKI, ANCHORAGE, testified via teleconference,
believed HB 3 puts public safety at risk. She opposed the
bill, stressing her belief that immigration issues should be
handled on the federal level.
2:36:00 PM
BILL SCANNELL, ANCHORAGE, testified via teleconference,
expressed his opposition to the Real ID Act since its
enactment and does not like HB 3. He believed HB 3 had been
dealt with last year with SB 202 when the state rejected the
Real ID Act. He described HB 3 as an immigration bill, not
best practices for Alaska driver's licenses.
2:38:13 PM
KRISTA STEARNS, ASSISTANT ATTORNEY GENERAL, DEPARTMENT OF
MOTOR VEHICLES testified via teleconference, indicated she
was available for questions.
Representative Gara suggested that help was needed in the
language of the proposed amendments. Ms. Stearns indicated
she would look at the language. She believed it was
problematic for the DMV to upgrade computers and funding
could be interpreted as Real ID.
Co-Chair Stoltze indicated that Amendments 1 and 2 will be
sent to Ms. Stearns to examine.
2:42:55 PM
KEVIN BROOKS, DEPUTY COMMISSIONER, DEPARTMENT OF
ADMINISTRATION commented that SB 202, passed last year, was
a compromise. He stressed that the Real ID Act is very thick
and contains some common sense good business practices for
the DMV but this bill does not plan to make the state
compliant with Real ID. He approved of HB 3 as good business
sense of Alaska.
Co-Chair Stoltze asked if the administration had taken a
position on illegal immigrants getting driver's licenses.
Mr. Brooks replied that the administration believes people
should have a legal presence to get a license.
Representative Gara asserted that he had a problem with the
work "solely." He acknowledged that most in the department
would not cross the line but keeping the word "solely" gives
the DMV the right to implement the Real ID Act. He
challenged that when criminal statutes are not written with
certainty, the discretion to interpret is left to law
enforcement with potential negative results. A law should be
written that does not allow future directors or employees of
the DMV to go down the road of implementing the Real ID Act.
2:46:01 PM
Deputy Brooks appreciated the comments, but reminded the
committee that the department is subject every year to the
appropriation act and legislative audit that provides checks
and balances. Representative Gara remarked that the best
check is to write the statute the correct way. Mr. Moffat
emphasized that Senator Wielechowski, sponsor of SB 202,
said HB 3 would have no impact on legal presence or good
practices of the DMV.
2:46:47 PM
Representative Gara repeated that the Senator Wielechowski
did not put the word "solely" into the bill and the
legislature has the obligation to write it correctly. Co-
Chair Stoltze stated that he thought the concept was simple
and leaned toward Representative Lynn's bill. Representative
Lynn reminded the committee that the judiciary heard the
identical bill last year. Co-Chair Stoltze interjected that
last year's decisions were not relevant this year.
2:47:47 PM
Co-Chair Stoltze announced that public testimony was now
closed.
2:49:19 PM
Representative Fairclough mentioned her familiarity with the
Alaska Justice project from her work at a victim's crisis
center. She related her personal experiences dealing with
immigrants brought into the country under false pretenses.
She wondered if there was consideration for those inside the
U.S. system trying to find freedom and justice.
Representative Lynn expressed his concern for people with
problems getting their legal documentation, but he
maintained that was outside the scope of this bill; the
issue was the correct qualifications for a driver's license.
Representative Lynn stressed that the entire immigration
situation was difficult and involved, but he felt that if
someone was in the country illegally they should not be able
to get a driver's license. Mr. Moffat stressed that this
bill was not trying to punish anyone, but hopefully
encourage non-United States citizens to keep their legal
immigration status current.
2:51:32 PM
Representative Fairclough contended that in her work with
domestic crisis victims, individuals may have their
immigration papers kept from them in order to control their
lives and movements. She maintained her concern for women
and children in these difficulties.
2:52:59 PM
Representative Fairclough asked Ms. Bronen if the people she
handled were seeking driver's licenses in order to stay in
the country. Ms. Bronen answered that most people were not
particularly seeking licenses, but it is a document most
will need eventually to get safety and protection.
Representative Fairclough asked if there was a place
immigrants could ask for help to protect their rights inside
of the process. Ms. Bronen answered that processing
documentation moves slowly and there is no process to get
earlier or waivered documentation. Representative Fairclough
stated that if the police are responding to a domestic
violence or rape situation, the victim's lack of
documentation can not be used against them. Ms. Sterns
replied that she was not an authority in criminal law, but
believed that lack of documentation is not used against a
victim.
Representative Austerman wondered if he left the state for
90 days and received a license in another state what
documents would he need to present in order to reestablish
his Alaska license.
2:59:16 PM
Ms. Brewster replied that he would need to provide one of
the listed primary documents. Representative Austerman asked
how is showing the primary documentation different from the
presented change in the law in BH 3. Ms. Brewster replied
that the DMV was looking for the license to expire when the
documentation expires.
Representative Gara expressed the need for more time to
discuss and rewrite this bill before passing. Co-Chair
Stoltze agreed that many questions still required acceptable
answers. Representative Austerman mentioned that he does not
see in HB 3 where it mentions the length of time for a
license. Representative Lynn said the basic premise of the
bill is that the driver's license would expire when legal
status expires. Ms. Brewster agreed that was the
understanding of the bill.
3:02:33 PM
Representative Austerman hypothesized if he left the state
for a few years, his license would expire. Representative
Lynn agreed that legal documentation would need to be shown
before receiving a new Alaska driver's license.
Representative Austerman asked why new language was being
added to identify the documentation if it was already
required. Ms. Brewster answered that the language is for
clarification in statute and to identify that those
currently in the state with a legal license do not have to
go through the process again.
3:05:41 PM
Representative Fairclough asked, in response to
Representative Austerman's question, if there were criteria
or a booklet listing the acceptable documentation for a
driver's license in other states. Ms. Brewster responded
that an out-of-state driver's license is not an accepted
primary form of identification.
3:07:19 PM
Representative Crawford noted in the proposed Amendment #1
that if the word "solely" was deleted this would help where
they were going with Amendment #2. Mr. Brooks commented that
Amendment #1 is very similar to the language found in SB 202
specifying that nothing would be done to comply with the
Real ID Act, while recognizing there was many worthwhile
things in the act. Amendment #2 is more specific in being
opposed to the Real ID Act. Co-Chair Stoltze indicated that
no vote would be taken today as more discussion was needed.
Representative Crawford noted that if the word "solely" was
struck this may help lesson the impression that there was
compliance to the Real ID Act.
3:11:15 PM
Co-Chair Stoltze indicated that his staff member, Mr.
Mulligan, would work with several legislators and the
sponsor of the bill to reach a consensus. Representative
Austerman expressed that he just needed to understand the
bill better.
HB 3 was HEARD and HELD in Committee for further
consideration.
3:13:37 PM AT EASE
3:17:08 PM RECONVENED
CS FOR HOUSE BILL NO. 20(FSH)
"An Act relating to commercial fishing loans for energy
efficiency upgrades and increasing the maximum amount
for certain loans under the Commercial Fishing Loan
Act; and providing for an effective date."
REPRESENTATIVE BRYCE EDGMON presented HB 20 which amends a
commercial fishing loan act to allow for a greater number of
fishermen to participate in an energy efficiency loan
program. This bill would allow for a fixed rate loan for up
to 15 years at prime minus 2 percent. Representative Edgmon
specified that the bill allows for Section A loan
participants to participate in a loan program currently
confined to Section B participants. He elaborated that to be
a Section B participant, the fisherman must have been turned
down by a bank, demonstrated that one-third of their gross
income derives from commercial fishing, and they are in the
low income or poverty level. He differentiated that Section
A is a loan program, up to $300,000, for commercial
fishermen who can demonstrate they have been in Alaska for
several years and fished the last 2 out of 5 years.
Representative Edgon noted that HB 20 also raises the
overall cap from Section A and Section B participants from
$300,000 to $400,000 and makes the new energy efficiency
program retroactive to September 1, 2008 with an immediate
effective date.
3:21:13 PM
Representative Kelly questioned the delinquency rate of the
loan fund and who the bill misses. Representative Edgmon
responded that the loan portfolio is performing very well
which is why they are able to bring this forward.
Representative Kelly requested some numbers for further
information. Co-Chair Stoltze asked for clarification if
this was income based or by credit record.
3:22:32 PM
Representative Edgmon replied that there is no income levels
in terms of earning potential, but limits as to how much can
be borrowed under Section A and Section B. Section A has a
limit of $300,000 and Section B with a lower $100,000 cap
contains the additional requirements that the fisherman must
have been turned down by a bank and that one third of the
gross income comes from commercial fishing. Co-Chair Stoltze
asked if there is any delineation for size of the operation.
Representative Edgmon responded that the ceiling would be
$400,000 in combination with the two loan subsections. He
clarified that a fisherman would have to prove the ability
to repay the loan over a 15 year period.
3:25:13 PM
Co-Chair Stoltze asked how the department evaluates a good
business risk. Vice-Chair Thomas interjected that as a 40
year commercial fisherman, he never qualified for this loan
because he has never been turned down by a bank. He believed
this loan could help his son obtain a down payment for his
own operation. Representative Edgmon repeated there were two
different loan sections. He noted that the change would
allow Section A participants to cross over to Section B in
order to obtain more energy efficiency loans. He reminded
that in Section B the fisherman has to be turned down by a
bank, but Section A does not have that requirement. The
energy efficiency loan only resides in Section B; this bill
is trying to broaden the loan to include those only eligible
for Section A.
3:27:25 PM
Co-Chair Stoltze illustrated that Vice-Chair Thomas could
not get this energy efficiency loan because of his good past
behavior practices. Vice-Chair Thomas favored this bill for
providing the means to acquire more fuel efficient vessels
especially since fishermen were traveling further offshore
to obtain more wild stocks. He added this would help in
marketing wild stock salmon and in emission controls.
3:28:44 PM
Representative Edgmon agreed the bill would enable someone
like Vice-Chair Thomas, a Section A participant, to
participate in the energy efficiency program residing in
Section B. Representative Austerman contended that the
bill's original purpose is for fishermen to acquire more
energy efficient engines to help offset the high cost of
fuels and reduce the carbon footprint in the ocean. He added
this would also allow boats to be geared with other energy
efficiency means, such a adding a small wind generator or
solar panel while in the harbor.
3:29:58 PM
Vice-Chair Thomas remarked that 5 to 10 percent of fuel can
be saved by changing the bow design on some larger boats.
3:30:53 PM
Co-Chair Stoltze asked if this bill also applies to the
health of the fisheries in rivers. Representative Edgmon
replied that many fishermen travel a long way to the harvest
grounds; therefore more efficient engines would improve the
health of fisheries everywhere. He added that in this low
interest environment fishermen could change to more fuel
efficient vessels.
3:32:21 PM
Co-Chair Stoltze asked if the bill could help modernize
boats in the big river systems. Representative Edgmon
replied that HB 20 addresses the commercial fishing loan
program, but within the portfolio there are smaller loan
programs available to help smaller vessels. Co-Chair Stoltze
wondered if off shore charter boats could be helped to burn
oil in a more efficient manner and if this was consistent
with the bill's idea to promote fuel efficiency.
3:34:13 PM
Representative Austerman interjected that there was
discussion on the charter boat issue, especially on larger
river systems, but it was outside the commercial loan
program. He added that an attempt to classify sports charter
fishing as commercial fishing had been rejected by the
charter fishing boat operators. Vice-Chair Thomas reported
that many sport charter operators are not residents of the
state. Representative Austerman mentioned that charter boats
from his region asked if they would be covered under this
bill, but indicated they were not willing to be classified
as commercial fishermen.
3:36:08 PM
Representative Edgmon replied the bill's intent was confined
to commercial fishermen.
3:37:09 PM
Representative Fairclough supported the concept of the bill,
but not the fiscal note attached. She noticed that
departments request new full time employees (FTE) every time
a new program is started. She asked Representative Edgmon
how much money was currently in the fund. Representative
Edgmon responded that the position in the fiscal note is for
an anticipated need that will be based on how many
participants come into the program. He added the funds
derive from the portfolio itself with no general funds.
Representative Fairclough asked how many loans, managed by
the Department of Commerce, Community and Economic
development, were applied for in FY08 and FY09, the value of
the loans, and how many FTE's presently manage it.
3:39:19 PM
GREG WINEGAR, DIRECTOR, ALASKA DIVISION OF INVESTMENTS,
DEPARTMENT OF COMMERCE presented an overview on the history
of the program. Sixty million dollars were originally put
into the program and over $400 million has been distributed
in loans; it pays its own way with no expenses to the
general fund. The fiscal note was added for the position
because of an anticipated rise in demand once this bill is
implemented. The department anticipates $4.8 million in
loans for the first year, but the position will not be
filled unless needed. Co-Chair Stoltze asked if commercial
charters would be eligible for this loan. Mr. Winegar
replied that this program, dating from the early 70s, is for
commercial fishermen not the charter boats as these are
totally different industries. A major change in the program
would be needed to incorporate the charter boat industry.
3:42:55 PM
Representative Fairclough reiterated that she supports the
bill, but believed there is a consequence to the general
fund by withdrawing out additional operating dollars. She
understood the interest that is earned off the fund is
dropped into the general fund, so there will be less
interest if reducing the capital asset. Mr. Winegar replied
that the interest goes into the fund, not the general fund.
It is a revolving fund so all the payments, interest, and
earnings on investments, roll into the fund itself and all
the expenses are paid out of the fund. Representative
Fairclough referred to page 2, second paragraph of the
fiscal note:
Currently, cash in the CFRLF is managed by the
Department of Revenue and is invested in short term
instruments that are yielding minimal returns in this
interest rate environment. These earning are retained
by the General Fund.
Representative Fairclough asked if this referred to the
general fund in CFRLF or the state of Alaska general fund.
Mr. Winegar replied that basically the cash going into the
general fund right now is minimal. He noted that the fiscal
note refers to an indeterminate change in the interest rate
charged by the loans, the 2 or 3 percent range, with
expenses and losses coming out that may have an impact
depending on earnings.
3:45:00 PM
Representative Fairclough asked how much is in the current
fund. Mr. Winegar projected that at the end of FY09, the
fund is around $30 million. The portfolio with interest and
principle is around $72 million; the total around $100
million. Representative Fairclough asked how many loans are
managed in this division and how many loans this new FTE
position would manage. Mr. Winegar estimated that the new
position would be working on $4.8 million in loans over and
beyond the current amount. Representative Fairclough asked
again from the department's perspective the utilization of
grant dollars generated from the state versus federal money.
3:47:48 PM
Winegar answered that the fund manages $204 million in
assets and loans with over 2600 accounts, in addition, there
is cash managed by Department of Revenue. Representative
Fairclough asked how many FTE's are now managing the 2600
accounts. Mr. Winegar had percentages but not numbers.
Representative Fairclough replied she needs the numbers. Mr.
Winegar referred to a January 12, 2009 report that the total
delinquency accounts were 2.8 percent, .1 percent in
foreclosure, 7.5 percent delinquent in commercial fishing,
and .3 percent in foreclosure.
3:50:11 PM
Representative Austerman addressed the willingness to
discuss the charter sport operators. Co-Chair Stoltze
expressed his sympathy for helping the charter boat industry
as a statewide responsibility. Vice-Chair Thomas added that
his district has about 2300 commercial fishermen. He
remarked that commercial fishermen are punished by the
excessive overfishing by charter boats. He declared he has
no problem helping the small charter vessel with fuel
efficiency programs, but not the large out-of-state
operators.
3:56:34 PM
Co-Chair Stoltze indicated this bill would require another
hearing to refine some of the questions asked.
Representative Fairclough wondered with the $72 million in
the fund, with the expected $4.2 million increase in
requested loans, would the money come out of the $72 million
or the $30 million cash flow. She requested clarification
that in the $204 million in outstanding loans, if the
monthly payments return to the fund to create the cash flow.
Mr. Winegar agreed that was correct; it is a revolving
process. Representative Fairclough asked if the $4.2 million
will reduce the earning ability of the assets just sitting,
or increase because it is getting paid a fixed interest rate
from the funds being loaned against. Mr. Winegar agreed that
was correct. He pointed out that of the $60 million
originally put into the fund over $100 million had come out
and a large amount has reverted into the general fund or to
support other organizations, such as the Department of Fish
and Game. Representative Fairclough asked if she could be
provided information on what was contributed to the general
fund in FY08 and FY09.
4:00:03 PM
HB 20 was HEARD and HELD in Committee for further
consideration.
ADJOURNMENT
The meeting was adjourned at 4:00 PM.
| Document Name | Date/Time | Subjects |
|---|---|---|
| AkConsvAllianceHB20Support.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| Amendment 2 Gara.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| AS 04.16.050.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 98 |
| Anchorage Muni Resolution.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| DMV Procedures.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| HB 3 Articles.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| HB 3 Sectional Summary.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| CSHB20-FSH--SponsorStatementAndSectional.doc |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| CSHB20 (FSH) SWAMC Support.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| Explanation of Version Changes.doc |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| Commercial Fishing Loan Fund Summary.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| Amendment 3 Gara.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| HB20--RTennysonSupportMssg.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20-FJohnsonSupport.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20-RDC Support.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20GlenGardnerSupport.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20HarringtonSupportMssg.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20SEAKFSHAllianceSupport.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB20UFASupport.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| HB3 Stoltz amendment.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| Immigration_Numbers_Alaska_Justice_Forum.pdf |
HFIN 2/17/2009 1:30:00 PM |
|
| New HB98 Fiscal Note DPS .pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 98 |
| PSPA Support for HB20.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| SeaGrantFuelSurvey--HB20.pdf.PDF |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |
| Michigan_Stops_issuing_licenses_illegals.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| Sponsor Statement.pdf |
HFIN 2/17/2009 1:30:00 PM |
HB 98 |
| Sponsor_Statement.doc |
HFIN 2/17/2009 1:30:00 PM |
HB 3 |
| Support Letter Brakel.doc |
HFIN 2/17/2009 1:30:00 PM |
HB 20 |