Legislature(1995 - 1996)

02/08/1995 03:05 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
          HOUSE LABOR AND COMMERCE STANDING COMMITTEE                          
                        February 8, 1995                                       
                           3:05 p.m.                                           
 MEMBERS PRESENT                                                               
 Representative Norman Rokeberg, Vice Chairman                                 
 Representative Jerry Sanders                                                  
 Representative Beverly Masek                                                  
 Representative Gene Kubina                                                    
 MEMBERS ABSENT                                                                
 Representative Pete Kott, Chairman                                            
 Representative Brian Porter                                                   
 Representative Kim Elton                                                      
 COMMITTEE CALENDAR                                                            
 Overview:  Department of Commerce Commissioner-Designate Willie               
 WITNESS REGISTER                                                              
 WILLIAM L. HENSLEY, Commissioner-Designate                                    
 Department of Commerce                                                        
   and Economic Development                                                    
 Post Office Box 110800                                                        
 Juneau, AK 99811-0800                                                         
 Telephone:  (907) 465-2500                                                    
 POSITION STATEMENT: Overview of Department                                    
 ACTION NARRATIVE                                                              
 TAPE 95-5, SIDE A                                                             
 Number 000                                                                    
 The House Labor and Commerce Committee was called to order by Vice            
 Chairman Norman Rokeberg at 3:05 p.m.  Members present at the call            
 to order were Representatives Rokeberg, Sanders, Masek, and Elton.            
 Members absent were Representatives Kott, Porter and Kubina.                  
 VICE CHAIRMAN NORMAN ROKEBERG stated there was a quorum present.              
 Number 023                                                                    
 COMMISSIONER-DESIGNATE WILLIE HENSLEY, started his overview of the            
 department by introducing his staff.  Mr. Hensley explained how the           
 Department of Commerce and Economic Development (DCED) represented            
 a marriage between the state's business, regulatory, and economic             
 development promotional efforts.  He noted that his goal was to               
 promote a healthy and active expanding business community.  He                
 explained that the regulatory programs are managed so as to protect           
 the Alaskan consumers, while minimizing government imposed barriers           
 to business activity.  The economic development programs offer                
 advocacy and financing, services designed to strengthen and                   
 diversify our economic base, increase employment opportunities, and           
 stimulate private enterprise.  Commissioner Hensley then went on to           
 explain the different divisions within the department with regards            
 to it's budget.  He explained that the department's budget was very           
 neutral in the sense that this year the department generated $73              
 million for the general fund and spent only $40.5 million.  He                
 stated that almost all of the regulatory agencies were self                   
 supporting and several produce significant unrestricted revenues              
 for the general fund.  Commissioner Hensley voiced his concern                
 regarding the importance of extending the Alaska Public Utilities             
 Commission (APUC), which is in its wind-down year.  The regulatory            
 cost charge which covered 100 percent of the APUC cost was                    
 repealed, effective at the end of December, 1994.  Commissioner               
 Hensley stated that the department strongly supports HB 99 ("An Act           
 extending the Alaska Public Utilities Commission; and relating to             
 regulatory cost charges.")  Commissioner Hensley then reported that           
 there were three occupational licensing boards that were in their             
 wind down years:  The Big Game Commercial Services;  The Nursing              
 Home Administrators;  and, the Marine Pilots.  He explained that if           
 these boards are not extended, a person would no longer be required           
 to be licensed to be occupied in these professions.  In addition              
 there are seven boards up for extension:  The Medical Board:  The             
 Marital & Family Therapy Board:  Real Estate Appraisers Board:                
 Psychologist and Psychological Associate Examiners Board;  Board of           
 Nursing; and, Clinical Social Workers Board.  He commented that no            
 legislation has been submitted to extend the boards, but that the             
 legislative auditor has recommend that they all be extended or they           
 will go into their wind-down year.                                            
 Commissioner Hensley talked about how investments in Alaska must              
 compete with projects around the globe.  He explained that other              
 countries are desperate for investment capital and Alaska has to be           
 competitive.  He outlined a four year program aimed at dealing with           
 decision makers in major industries such as:  Oil and gas; mining;            
 fishing; and tourism.  Commissioner Hensley stated that if there              
 were problems in these industries that the state was there to help,           
 and that they also wanted to know the latest conditions in the                
 industries.  He stated the best way to do that was with                       
 face-to-face discussions.  He stated that they welcome industry,              
 but they want them to understand that they would not destroy what             
 tourists have come to see.  He expressed that there should be a               
 mutual effort between the major land owners, the state, the federal           
 and Native land owners in promoting Alaska.  This plan will also              
 help Alaskan enterprises sell Alaskan products, services, and our             
 Arctic know-how around the world.  He described the Russian                   
 American Enterprise Fund which is designed to assist emerging                 
 enterprises in Russia and the Far East, to ensure that democracy              
 works.  Many Alaskan firms are presently selling products and                 
 services in that part of the world, he stated.  He talked of                  
 opening the Arctic National Wildlife Refuge (ANWR), for                       
 environmentally responsible development.  He spoke of the renewal             
 of the Magnussen Act, to continue Alaskan involvement in our                  
 fisheries.  He also spoke about promoting rural development through           
 continuation of the Community Development Quotas Program.                     
 Number 260                                                                    
 VICE CHAIRMAN ROKEBERG noted, for the record, that Representative             
 Brian Porter arrived at 3:06 p.m. and Representative Gene Kubina              
 arrived at 3:20 p.m.                                                          
 Number 279                                                                    
 REPRESENTATIVE BRIAN PORTER  commented on the Administration's                
 support of tourism during the campaign and asked Commissioner                 
 Hensley what specific plans they had.                                         
 COMMISSIONER HENSLEY stated that Tourism was the key area for                 
 growth in Alaska, and commented on the budget cutbacks in                     
 marketing, especially with regard to television advertising.                  
 Number 323                                                                    
 REPRESENTATIVE JERRY SANDERS asked Commissioner Hensley if tourism            
 would be able to tax itself and pay for its own promotion.                    
 COMMISSIONER HENSLEY said this would be complex because different             
 communities have different mechanisms for raising revenue from                
 tourists, but it was his hope that they could have a partnership              
 arrangement with the industry and hopefully there could be ways to            
 raise revenue.                                                                
 REPRESENTATIVE BEVERLY MASEK noted that during the campaign the               
 Governor committed himself and his Administration to helping the              
 small business owners.  She asked how the Commissioner saw himself            
 carrying out that mandate in tourism.                                         
 Number 360                                                                    
 COMMISSIONER HENSLEY replied that a lot of small communities and              
 enterprises aren't aware of what's available through the different            
 divisions, and that part of his intent would be to work more                  
 closely with small enterprises.  He also talked of working with               
 larger operators and that perhaps they could help steer tourists              
 into communities that may not have had tourist attractions before.            
 Number 390                                                                    
 REPRESENTATIVE MASEK clarified that the Commissioner had mentioned            
 working with small businesses at a statewide level. In Fairbanks,             
 Mat-Su, and the Kenai Peninsula, many businesses popping up are               
 small restaurants and bed and breakfasts.  She asked how he                   
 expected to work with them statewide.                                         
 Number 408                                                                    
 COMMISSIONER HENSLEY stated that they worked closely with the                 
 various economic planning groups throughout the state, the                    
 convention and visitors bureaus, and the Alaska Visitors                      
 Association.  He stated that they would work more closely with                
 individual enterprises, cities, and boroughs in different parts of            
 the state.                                                                    
 Number 414                                                                    
 REPRESENTATIVE KIM ELTON asked the Commissioner if he foresaw a               
 change in what DCED was doing with rural economic development and             
 what Community and Regional Affairs was doing.                                
 Number 419                                                                    
 COMMISSIONER HENSLEY stated that he would like to work                        
 cooperatively so that communities would have a focal point for                
 their inquiries about economic development and which agencies would           
 be able to help them.  He feels there are ways to work together               
 without going into structural changes.                                        
 Number 445                                                                    
 REPRESENTATIVE ELTON asked if we really needed an oversight                   
 function for marine pilots.  Also, he asked what the Division of              
 Tourism's response would be to an initiative that set up a special            
 marketing program for sport fishing.                                          
 Number 456                                                                    
 COMMISSIONER HENSLEY stated that there's significant state interest           
 in insuring that lives and property are protected.  At the same               
 time, as far as commerce is concerned, whatever system we have in             
 the marine pilots area, must be able to accommodate future growth.            
 If we have the opportunity to ship our oil to the Orient, the gas             
 pipeline gets built, or an iron ore plant is opened on the Kenai              
 Peninsula, the marine pilot system needs to be able to grow.                  
 Number 482                                                                    
 VICE CHAIRMAN ROKEBERG inquired regarding the status on the sunset            
 bill for marine pilots, as well as some of the other boards and               
 COMMISSIONER HENSLEY stated that there wasn't any bill yet, but               
 said that his deputy Jeff Bush would be available to work on that.            
 He stated that on the question of sport fishing, he wasn't that               
 familiar with the issue, but they would discuss it internally.                
 Number 501                                                                    
 REPRESENTATIVE GENE KUBINA commented that he was very much in favor           
 of the gas pipeline, and he encouraged the Commissioner to make               
 sure the people in his department were very knowledgeable about the           
 project.  He suggested that the Commissioner get with Yukon Pacific           
 for their side of it.  He stated we should be able to bring people            
 in the oil industry and Yukon Pacific together, and that this would           
 help prevent having to do a lot of other things for many years.               
 Number 525                                                                    
 COMMISSIONER HENSLEY stated that he has had several discussions on            
 the repeal of the export ban.  He mentioned that ARCO had been                
 nervous about the price that they would pay for their crude at                
 their refineries on the West Coast.  As far as gas is concerned,              
 the Commissioner said that Mr. Condray, from Exxon, considers the             
 gas they own as their major asset in North America.  There are                
 people looking at how to design a gas pipeline, such as the route             
 along the pipeline.  They are also looking at a western route.                
 They're looking at the market and where the capital would come                
 from.  Commissioner Hensley also spoke of the difference between              
 oil and gas, and about the difference in laws to deal with the                
 large investment over the long term.                                          
 Number 575                                                                    
 VICE CHAIRMAN ROKEBERG  stated that he was pleased with the                   
 Governor's appointment of Commissioner Hensley.                               
 Number 588                                                                    
 COMMISSION HENSLEY  spoke of the Department of Labor's report of              
 75,000 nonresident jobs in the state, and that we need to encourage           
 businesses on Alaskan hire.                                                   
 VICE CHAIRMAN ROKEBERG commented that this morning the exact same             
 opinions were expressed in House floor session.                               
 Number 614                                                                    
 REPRESENTATIVE BEVERLY MASEK asked what was going to be needed to             
 see more results for the dollars spent on tourism statewide.                  
 COMMISSIONER HENSLEY stated that at this point they were assessing            
 that.  He talked of taking a closer look at the Division of                   
 Tourism, and of working closely with the private sector, but that             
 he didn't have a concrete direction he wanted to express at this              
 REPRESENTATIVE MASEK commented that when he found his direction,              
 the committee would be glad to hear his comments.  Representative             
 Masek asked if the department would be open to new ideas, concepts            
 and strategies in tourism.                                                    
 NUMBER 800                                                                    
 COMMISSIONER HENSLEY stated that they would be open to any input.             
 TAPE 95-5, SIDE B                                                             
 Number 000                                                                    
 COMMISSIONER HENSLEY stated that he felt a lot of what was missing            
 in these areas was the human element.  He talked of the history of            
 the Prince William Sound area, that it was like a war zone with the           
 Upik and the Tlingits moving up and the Athabascans moving down,              
 followed by the arrival of the Russians.  He felt that this type of           
 history wasn't being effectively portrayed for the visitors.  He              
 stated that this type of history should be presented in the                   
 different regions to our visitors.                                            
 REPRESENTATIVE MASEK asked Commissioner Hensley what his first                
 priority would be in the department.                                          
 COMMISSIONER HENSLEY stated that his first priority would be to get           
 everyone that he needs on board.  The other priority would be to              
 respond to the Governor's goal of coming up with a marketing effort           
 that would cover a wide range of things, including working with the           
 smaller communities and businesses.                                           
 Number 040                                                                    
 REPRESENTATIVE BRIAN PORTER brought up an International Trade and             
 Tourism meeting of February 7, 1995, that discussed the problem of            
 limited access to public land.                                                
 Number 065                                                                    
 COMMISSIONER HENSLEY stated that he was co-chairing a conference of           
 government land owners to discuss how they could work                         
 cooperatively, not only to attract tourists, but how best to                  
 accommodate them.                                                             
 VICE-CHAIRMAN ROKEBERG mentioned the American-Russian Enterprise              
 Fund, and asked if there was anything the legislature could do to             
 expand that area through additional funding.                                  
 COMMISSIONER HENSLEY stated that Congress had been receptive                  
 to this fund.  This fund, he stated, was modeled after the Polish             
 Fund when they went Democratic and changed their economy.  It                 
 operates like an investment bank, in that it provides net capital.            
 It can also buy equity in a venture and provide small loans.                  
 VICE-CHAIRMAN ROKEBERG stated that he had heard some rumors about             
 requests for supplemental appropriations for the tourism                      
 advertising program.                                                          
 Number 150                                                                    
 COMMISSIONER HENSLEY stated that he had also heard that, but didn't           
 know for sure whether there had been an actual request put                    
 together.  He felt it was imminent.                                           
 Number 182                                                                    
 VICE-CHAIRMAN ROKEBERG adjourned the House Labor and Commerce                 
 Committee meeting at 4:00 p.m.                                                

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