Legislature(1995 - 1996)
02/08/1995 03:05 PM L&C
* first hearing in first committee of referral
= bill was previously heard/scheduled
= 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 Hensley 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 commissions. 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 time. 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. ADJOURNMENT Number 182 VICE-CHAIRMAN ROKEBERG adjourned the House Labor and Commerce Committee meeting at 4:00 p.m.