Legislature(1997 - 1998)
03/20/1997 08:05 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE STATE AFFAIRS STANDING COMMITTEE
March 20, 1997
8:05 a.m.
MEMBERS PRESENT
Representative Jeannette James, Chair
Representative Ethan Berkowitz
Representative Fred Dyson
Representative Kim Elton
Representative Mark Hodgins
Representative Ivan Ivan
Representative Al Vezey
MEMBERS ABSENT
All members present.
COMMITTEE CALENDAR
SENATE BILL NO. 77
"An Act relating to the Alaska Day of Prayer."
- PASSED SB 77 OUT OF COMMITTEE
HOUSE BILL NO. 84
"An Act limiting the authority to conduct pull-tab charitable
gaming to qualified organizations that are exempt from taxation
under 26 U.S.C. 501(c)(3) or (19); and providing for an effective
date."
- HEARD AND HELD
*HOUSE BILL NO. 143
"An Act relating to the art in public places requirements for
state-owned and state-leased buildings and facilities."
- HEARD AND HELD
*HOUSE BILL NO. 78
"An Act relating to the definition of certain state receipts; and
providing for an effective date."
- SCHEDULED BUT NOT HEARD
*HOUSE BILL NO. 155
"An Act relating to hearings before and authorizing fees for the
State Commission for Human Rights; and providing for an effective
date."
- SCHEDULED BUT NOT HEARD
HOUSE BILL NO. 83
"An Act relating to commercial motor vehicle inspections; and
providing for an effective date."
- SCHEDULED BUT NOT HEARD
(* First public hearing)
PREVIOUS ACTION
BILL: SB 77
SHORT TITLE: ALASKA DAY OF PRAYER
SPONSOR(S): SENATOR(S) TAYLOR, Leman, Phillips, Parnell, Ward,
Green, Pearce, Halford, Duncan, Sharp, Miller, Kelly, Torgerson,
Mackie; REPRESENTATIVE(S) Grussendorf, Dyson
JRN-DATE JRN-PG ACTION
02/04/97 226 (S) READ THE FIRST TIME - REFERRAL(S)
02/04/97 226 (S) STATE AFFAIRS
02/25/97 (S) STA AT 3:30 PM BELTZ ROOM 211
02/25/97 (S) MINUTE(STA)
02/26/97 516 (S) STA RPT 3DP
02/26/97 516 (S) DP: GREEN, MILLER, WARD
02/26/97 516 (S) ZERO FISCAL NOTE (S.STA)
03/05/97 (S) RLS AT 11:52 AM FAHRENKAMP RM 203
03/05/97 (S) MINUTE(RLS)
03/06/97 592 (S) RULES TO CALENDAR 3/6/97
03/06/97 598 (S) READ THE SECOND TIME
03/06/97 598 (S) ADVANCED TO THIRD READING UNAN CONSENT
03/06/97 598 (S) READ THE THIRD TIME SB 77
03/06/97 598 (S) COSPONSOR(S): LEMAN, PHILLIPS, PARNELL
03/06/97 598 (S) WARD, GREEN, PEARCE, HALFORD, DUNCAN,
03/06/97 598 (S) SHARP, MILLER, KELLY, TORGERSON, MACKIE
03/06/97 599 (S) PASSED Y20 N-
03/06/97 607 (S) TRANSMITTED TO (H)
03/07/97 577 (H) READ THE FIRST TIME - REFERRAL(S)
03/07/97 577 (H) STATE AFFAIRS
03/07/97 594 (H) CROSS SPONSOR(S): GRUSSENDORF
03/10/97 618 (H) CROSS SPONSOR(S): DYSON
03/20/97 (H) STA AT 8:00 AM CAPITOL 102
BILL: HB 84
SHORT TITLE: PULL-TABS LIMITED TO 501(C)(3) OR (19)
SPONSOR(S): REPRESENTATIVE(S) MARTIN
JRN-DATE JRN-PG ACTION
01/22/97 122 (H) READ THE FIRST TIME - REFERRAL(S)
01/22/97 122 (H) STATE AFFAIRS, L&C, FINANCE
03/11/97 (H) STA AT 8:00 AM CAPITOL 102
03/11/97 (H) MINUTE(STA)
03/13/97 (H) STA AT 8:00 AM CAPITOL 102
03/13/97 (H) MINUTE(STA)
03/15/97 (H) STA AT 11:00 AM CAPITOL 102
BILL: HB 143
SHORT TITLE: REPEAL ART IN PUBLIC PLACES REQUIREMENT
SPONSOR(S): REPRESENTATIVE(S) VEZEY
JRN-DATE JRN-PG ACTION
02/17/97 374 (H) READ THE FIRST TIME - REFERRAL(S)
02/17/97 375 (H) STATE AFFAIRS
03/20/97 (H) STA AT 8:00 AM CAPITOL 102
WITNESS REGISTER
JOE AMBROSE, Legislative Assistant
to Senator Robin Taylor
State Capitol, Room 30
Juneau, Alaska 99801-1182
Telephone: (907) 465-3873
POSITION STATEMENT: Presented sponsor statement for SB 77.
REPRESENTATIVE TERRY MARTIN
Alaska State Legislature
State Capitol, Room 502
Juneau, Alaska 99801-1182
Telephone: (907) 465-3783
POSITION STATEMENT: Sponsor of HB 84.
DENNIS POSHARD, Director
Charitable Gaming Division
Department of Revenue
P.O. Box 110440
Juneau, Alaska 99811-0440
Telephone: (907) 465-2229
POSITION STATEMENT: Provided testimony on HB 84.
GERALD J. DORSHER, Legislative Officer
Veterans of Foreign Wars
P.O. Box 240003
Douglas, Alaska 99824
Telephone: (907) 364-3346
POSITION STATEMENT: Provided testimony on HB 84.
GEORGE WRIGHT, Representative
Alaska Native Brotherhood Camp Number 2
320 Willoughby Avenue, Suite 100
Juneau, Alaska 99801
Telephone: (907) 586-2049
POSITION STATEMENT: Provided testimony in opposition to HB 84.
JOCELYN YOUNG, Curator of Public Art
Anchorage Museum of History and Art
121 West 7th Avenue
Anchorage, Alaska 99501
Telephone: (907) 343-6473
POSITION STATEMENT: Provided testimony on HB 143.
DAVID ROSENTHAL
P.O. Box 635
Cordova, Alaska 99574
Telephone: Not provided
POSITION STATEMENT: Provided testimony in opposition to HB 143.
SCOTT HAMANN
P.O. Box 934
Kenai, Alaska 99611
Telephone: (907) 283-4481
POSITION STATEMENT: Provided testimony in support of HB 143.
VICTORIA LORD, Director
Ketchikan Arts Council
338 Main Street
Ketchikan, Alaska 99901
Telephone: (907) 225-2211
POSITION STATEMENT: Provided testimony in opposition to HB 143.
EMILY MOORE
722 Park Avenue
Ketchikan, Alaska 99901
Telephone: (907) 225-6558
POSITION STATEMENT: Provided testimony in opposition to HB 143.
MICHAEL OLSON, President
Seward Arts Council
P.O. Box 2152
Seward, Alaska 99664
Telephone: (907) 224-7162
POSITION STATEMENT: Provided testimony in opposition to HB 143.
ANNIE STOKES
570 Alder Street
Juneau, Alaska 99801
Telephone: (907) 586-2852
POSITION STATEMENT: Provided testimony in opposition to HB 143.
SHANNON PLANCHON, Grant Administrator
Alaska State Council on the Arts
411 West 4th Avenue
Anchorage, Alaska 99501
Telephone: (907) 269-6610
POSITION STATEMENT: Provided testimony in opposition to HB 143.
ALAN MUNRO
120 West 9th Street
Juneau, Alaska 99801
Telephone: (907) 586-3694
POSITION STATEMENT: Provided testimony in opposition to HB 143.
MIKE ANDERSON
P.O. Box 1603
Cordova, Alaska 99574
Telephone: (907) 424-3142
POSITION STATEMENT: Provided testimony in opposition to HB 143.
JAMES EVENSON
P.O. Box 324
Kenai, Alaska 99611
Telephone: (907) 776-8060
POSITION STATEMENT: Provided testimony in opposition to HB 143.
CARL KRONBERG
1266 Millar
Ketchikan, Alaska 99901
Telephone: (907) 225-1297
POSITION STATEMENT: Provided testimony in opposition to HB 143.
CAROL BRYNER
626 "N" Street
Anchorage, Alaska 99501
Telephone: (907) 277-7967
POSITION STATEMENT: Provided testimony in opposition to HB 143.
SYBIL DAVIS
1116 Timberline Court
Juneau, Alaska 99801
Telephone: (907) 780-4376
POSITION STATEMENT: Provided testimony in opposition to HB 143.
LYNETTE TURNER, President
Arts for a Healthy Alaska
305 St. Anns Avenue
Juneau, Alaska 99824
Telephone: (907) 364-2420
POSITION STATEMENT: Provided testimony in opposition to HB 143.
JENANN KIRCHMEIER
Address not provided
Telephone: Not provided
POSITION STATEMENT: Provided testimony in opposition to HB 143.
ACTION NARRATIVE
TAPE 97-29, SIDE A
Number 0001
The House State Affairs Standing Committee was called to order by
Chair Jeannette James at 8:05 a.m. Members present at the call to
order were Representatives James, Dyson, Elton, Ivan and Vezey.
Members absent were Berkowitz and Hodgins.
REPRESENTATIVE IVAN IVAN introduced Mr. Michael Chatman from the
audience. He was here at the capitol building all day with a
project called "Follow That Bill." He hoped that Mr. Chatman would
not pick up on his bad habits.
SB 77 - ALASKA DAY OF PRAYER
The first order of business to come before the House State Affairs
Standing Committee was SB 77, "An Act relating to the Alaska Day of
Prayer."
CHAIR JEANNETTE JAMES called on Mr. Joe Ambrose, Legislative
Assistant to Senator Robin Taylor, sponsor, to present the bill.
Number 0136
JOE AMBROSE, Legislative Assistant to Senator Robin Taylor, read
the following sponsor statement into the record:
"In 1952, the US Congress resolved that a National Day of Prayer be
established, with the specific date subject to Presidential
proclamation. On May 5, 1988, President Ronald Reagan signed into
law a bill setting aside the first Thursday in May each year as the
National Day of Prayer.
"Senate Bill 77 would also mark the first Thursday in May as the
Alaska Day of Prayer.
"Observance of a Day of Prayer is as old as the nation itself and
in fact pre-dates the Declaration of Independence. George
Washington first proclaimed a day of prayer in 1775, during the
First Continental Congress.
"Thomas Jefferson, who termed the First Amendment `a wall of
separation between church and state', said he was convinced that a
man's natural right to religious expression was not in opposition
to his political function.
"Establishment of a Day of Prayer in Alaska follows a tradition
dating back to the Founding Fathers. It would encourage Alaskans
to pray without compelling them to do so."
Number 0257
REPRESENTATIVE ETHAN BERKOWITZ asked Mr. Ambrose if any other
states had adopted a state day of prayer to complement the national
day?
Number 0265
MR. AMBROSE replied seven states had adopted a state day of prayer.
In addition, many stated observed the day through an annual
proclamation. The Alaska Senate two years ago passed a resolution
asking the Governor to declare the first Thursday in May as the day
of prayer in Alaska.
Number 0324
REPRESENTATIVE BERKOWITZ asked Mr. Ambrose if there was any
particular reason why the state needed a day of prayer when there
was a national day?
Number 0331
MR. AMBROSE replied it would put a special emphasis on the day and
it would bring Alaskans together.
Number 0348
REPRESENTATIVE KIM ELTON commented that he believed it should be
the second Thursday in May because by that time the body would need
it more than the first Thursday in May.
CHAIR JAMES called for a motion to pass the bill out of the
committee.
Number 0378
REPRESENTATIVE FRED DYSON moved that SB 77 move from the committee
with individual recommendations and the attached zero fiscal
note(s). There was no objection, SB 77 was so moved from the House
State Affairs Standing Committee.
REPRESENTATIVE DYSON stated, for the record, that he had stepped on
the presenter's toes, literally; not figuratively, and apologized.
HB 84 - PULL-TABS LIMITED TO 501(C)(3) OR (19)
The next order of business to come before the House State Affairs
Standing Committee was HB 84, "An Act limiting the authority to
conduct pull-tab charitable gaming to qualified organizations that
are exempt from taxation under 26 U.S.C. 501(c)(3) or (19); and
providing for an effective date."
CHAIR JAMES called on Representative Terry Martin, sponsor of HB
84, to present the bill.
Number 0405
REPRESENTATIVE TERRY MARTIN, Alaska State Legislature, distributed
to the committee members a handout titled, "A Great Time to Brag."
People were concerned that the bill would stop their source of
money from the pull-tabs. He told them it would depend on what
they told the committee and what they had been doing with the
money. If the money did not go towards charitable purposes, then
there would be a problem. It was also a time for the charitable
groups and the citizens to brag about their programs and how they
had been helping true charitable purposes. Had they been giving
their money to Beans Cafe, or to scholarships, for example? Had
they been helping youth athletic programs? Were organizations
giving out more scholarships now that they had a permit? It was a
great time to see what was happening with the millions and millions
of dollars gained from pull-tabs. From the state's perspective, 8
percent of the total of $270 million was not very much when illegal
gamblers paid 10 to 15 percent for protection. He believed some of
the money went to the Alaska Charitable Gaming Association, Inc. to
protect what they were doing. Some used the money to fight
regulations in the courts instead of coming to the legislature
asking for adjustments. He reiterated it was a great opportunity
to scrutinize what was happening in the pull-tab world.
Number 0669
REPRESENTATIVE MARTIN further stated that HB 84 was strictly
related to pull-tabs. It had nothing to do with the organizations
that had a permit for auctions or bingos, for example.
Number 0699
REPRESENTATIVE IVAN asked Representative Martin if HB 84 would
prohibit municipalities from selling pull-tabs?
Number 0730
REPRESENTATIVE MARTIN replied it would be very interesting to find
out what the municipalities were doing.
CHAIR JAMES asked Representative Martin to answer the question of
Representative Ivan.
REPRESENTATIVE MARTIN replied he did not know if the bill would
prohibit municipalities. If they were not using the money for
charitable purposes then they should be questioned.
CHAIR JAMES asked Representative Martin if the bill prohibited
them?
REPRESENTATIVE MARTIN replied, "As I see it now it does, yes." It
was up to the committee if municipalities should be put back in as
charitable organizations. If they were using the money just for
more revenue instead of taxation, then they should be questioned.
Number 0774
REPRESENTATIVE IVAN asked Representative Martin if the
unincorporated communities would also be impacted by HB 84? Would
they be prevented from participating for example?
Number 0826
REPRESENTATIVE MARTIN replied, from my point of view, they should
be if the money was not going for charitable purposes. If the
money was going to the local administration then it was not very
charitable. That was what taxes and other avenues of money were
for, even in unincorporated communities.
Number 0851
CHAIR JAMES asked Representative Martin to explain the identified
codes in the bill and which ones would be excluded.
REPRESENTATIVE MARTIN deferred the question to Mr. Poshard,
Director, Charitable Gaming Division, Department of Revenue.
Number 0895
REPRESENTATIVE IVAN asked Representative Martin if he had
documentation that accounted for the amount of dollars from pull-
tab sales being placed into campaigns?
Number 0925
REPRESENTATIVE MARTIN replied he was going to save that information
for his other bill - HB 156. At such time, he would bring the
backup information that would give a person an idea of how much
money was going into the political process - directly and
indirectly. "It is absolutely amazing how much money. They make
the oil companies look like little pimps."
Number 0955
CHAIR JAMES asked Representative Martin if campaign finance reform
last year eliminated political contributions from pull-tab
activities?
Number 0963
REPRESENTATIVE MARTIN replied, "We attempted to." But the words
and phrases did not accomplish what we wanted to. The backup
information would show the loopholes. The biggest loophole, he
declared, was the prevention of corporations and unions from
contributing. The legislation did not prevent non-profit
organizations, however.
Number 1004
CHAIR JAMES replied that campaign finance reform made it
specifically clear that only individuals could make political
contributions.
Number 1017
REPRESENTATIVE MARTIN replied there were big loopholes that needed
to be closed.
Number 1032
REPRESENTATIVE BERKOWITZ asked Representative Martin if he was
seeking to exclude certain non-profits from qualifying?
Number 1044
REPRESENTATIVE MARTIN replied the challenge of HB 84 was to find
out which groups were not fulfilling the idea of charitable
purposes from the sale of pull-tabs. They had not been challenged
in 10 years. "Just because they are our friends and neighbors and
everything else, doesn't mean the monies they earn from pull-tabs
go to charitable purposes."
Number 1083
REPRESENTATIVE BERKOWITZ asked Representative Martin if he had a
list of the organizations that he was seeking to exclude?
CHAIR JAMES stated the Administration was going to come forward to
answer that question.
Number 1096
REPRESENTATIVE IVAN commented that the legislature was trying to
downsize government. Therefore, he believed that this bill would
have a detrimental impact on some of the communities that he
represented. He asked Representative Martin what was his opinion?
Number 1136
REPRESENTATIVE MARTIN replied it could go either way. It depended
on what the committee discovered. Part of the reason that pull-
tabs came about was to help the charitable needs of a community.
In addition, of the $270 million, less than 8 percent went to
actual charities. And from that charity alone maybe one-half of
the 8 percent went to an actual charitable purpose. Other states
mandated that 30 percent off of the top went to charity.
Number 1210
CHAIR JAMES asked Representative Martin if HB 84 did that?
Number 1226
REPRESENTATIVE MARTIN replied HB 84 scrutinized what the groups
were doing.
CHAIR JAMES asked Representative Martin if HB 84 had anything to do
with the percentages?
REPRESENTATIVE MARTIN replied, "No." His second bill addressed the
percentages.
CHAIR JAMES stated that the committee members should focus on HB
84.
REPRESENTATIVE MARTIN replied HB 84 focused on what groups should
be allowed and which groups should not be allowed.
Number 1250
DENNIS POSHARD, Director, Charitable Gaming Division, Department of
Revenue, explained that the division and the department had not
taken a position of either for or against the bill. "We feel that
the legislature has every right to decide who does and who does not
deserve to receive a permit to conduct charitable gaming
activities." It had been difficult to come up with an accurate
fiscal note because no state agency maintained a list of
501(c)(3)'s, 501(c)(19)'s or any other 501(c) type of organization.
The Income, Excise and Audit Division and the Corporation Division
maintained a list of 501(c)'s, but with no further designation. As
a result, the division contacted the Internal Revenue Service (IRS)
that provided a list of all of the designations. The division
received it last week, therefore, he did not have the time to redo
the fiscal note. The division was currently comparing the list of
501(c)(3)'s and 501(c)(19)'s from the IRS with the division's list
of pull-tab permitees. The division intended to create three
lists: organizations that currently had pull-tab permits that
would no longer be eligible; organizations that currently had pull-
tab permits that would remain eligible; and organizations that did
not have a pull-tab permit but would be eligible. The lists would
- hopefully - be available tomorrow, March 21, 1997.
MR. POSHARD further explained that the fiscal notes contained
several assumptions: that all 1995 charitable, educational and
religious organization that were issued permits were considered
501(c)(3)'s; and that the veteran organizations that were issued
permits were 501(c)(19)'s. He discovered there were some that were
designated as 501(c)(4). The division also assumed that all other
1995 organizations - IRA Native villages, volunteer fire
departments, fraternal organizations, fishing derby associations,
dog mushing associations, municipalities, labor organizations, non-
profit trade associations, and civic or service organizations -
were not designated as 501(c)(3)'s. The division, therefore,
calculated that approximately 362 charities that currently had
pull-tab permits would no longer be authorized to sell pull-tabs.
And the total estimated loss would be about $12 million, slightly
reducing the division's budget. It did not mean that the division
would have 362 less reports or applications to process because many
of those organizations conducted raffles as well, for example. The
division, however, would see a slight reduction in its program
receipts because it received a 3 percent pull-tab tax of the ideal
net of every pull-tab game, and a 1 percent fee of the $12 million
in proceeds.
Number 1561
CHAIR JAMES stated that the fiscal note also said that the division
would lose two full-time positions.
MR. POSHARD replied, "Correct."
CHAIR JAMES asked Mr. Poshard if the $117,000 marked on the fiscal
note was the two positions?
MR. POSHARD replied, "Correct."
CHAIR JAMES asked Mr. Poshard if the reduction in lost revenues was
expected to be $1,155,300?
MR. POSHARD replied, "Correct."
CHAIR JAMES replied then actually the division would only spend
$117,000 less.
MR. POSHARD replied, "Correct."
CHAIR JAMES replied there was a bigger gap in the division's income
versus its expenses.
Number 1597
REPRESENTATIVE DYSON asked Mr. Poshard if the 362 groups would not
be able to operate pull-tabs now because they did not qualify under
the federal non-profit regulations?
Number 1621
MR. POSHARD replied, "Correct." The number was an estimation based
on the assumptions mentioned earlier. The current estimation was
that 362 organizations would not qualify because they did not have
501(c)(3) or 501(c)(19) status with the IRS.
Number 1652
REPRESENTATIVE DYSON asked Mr. Poshard if many of them would
qualify if they applied?
MR. POSHARD replied some would be able to qualify just by applying
with the IRS, and some would not because they were not
incorporated. He explained incorporation was not a requirement,
currently. However, some had already received a designation, such
as 501(c)(4). They would have difficulty applying with the IRS to
receive a different designation because the designations were very
specific.
Number 1730
REPRESENTATIVE DYSON wondered if that was because their activity
fell outside of the framework of the charitable non-profits.
Number 1750
MR. POSHARD replied, "Correct." According to the IRS code, a
501(c)(3) was typically a, "religious, educational, charitable,
scientific, literary, testing for public safety, to foster national
or international amateur sports competition, or prevention of
cruelty to children or animals organization." A 501(c)(19) was
designated as, "post or organization of past or present members of
the armed forces." Therefore, if they were not an organization
that fell under those categories, they could potentially be
designated in a different (c) status.
Number 1786
REPRESENTATIVE DYSON asked Mr. Poshard if there would be 70 or a
100 or so of the 362 that would not qualify with their current
stated purpose?
Number 1798
MR. POSHARD replied it was difficult to estimate, but a majority
would probably not be able to qualify. The list was being run now.
Number 1819
REPRESENTATIVE MARK HODGINS asked Mr. Poshard if he had a
description of the 501 designations?
Number 1837
MR. POSHARD replied that he had two lists - the IRS codes and a
layman's term list.
Number 1850
REPRESENTATIVE HODGINS asked Mr. Poshard for a list of the 501
groupings that currently had pull-tab licenses, if possible.
CHAIR JAMES explained that the division was working on the list
now. She asked Mr. Poshard how soon would the list be ready?
MR. POSHARD replied - hopefully - tomorrow.
Number 1877
REPRESENTATIVE BERKOWITZ asked Mr. Poshard if the list included the
organizations that would be affected by HB 84?
MR. POSHARD replied, "Yes." The division was working on three
lists: current 501(c)(3) and (19) designations that did not have
pull-tab permits; 501(c)(3) and (19) designations that did have
pull-tab permits; and organizations that had pull-tab permits and
did not have a 501(c)(3) or (19) designation.
Number 1918
REPRESENTATIVE ELTON stated that part of the problem with the bill
was the suggestion that the money collected was not going where it
ought to go. He asked Mr. Poshard if it was possible to see
information from his office on these organizations?
Number 1960
MR. POSHARD replied the division had an annual report that
summarized that information. In addition, all of its records were
considered public information. Each permittee was required to file
a schedule E that required a list of every check that it wrote to
show how it used its proceeds.
Number 2002
REPRESENTATIVE ELTON asked Mr. Poshard if he went to his office and
asked to see the file of the Auke Bay Volunteer Fire Department,
for example, it would be available?
MR. POSHARD replied, "Correct." He could look at the file to see
how it spent its money, how it made its money, and/or its expenses.
Number 2023
CHAIR JAMES stated that this was convoluted because of the
description of the statements made by the sponsor indicating that
he had another bill related to this. The question of wanting to
know the contents of their file was irrelevant. House Bill HB 84
said that if an organization was not entitled to be tax-exempt from
the IRS then it was not entitled to a pull-tab permit. Thus, those
who would qualify and who would give money to the right places had
nothing to do with the bill. Part of the requirement was that no
political activities were allowed in a 501(c)(3) designation. It
was also her understanding that it did not have to do with whether
or not an organization was putting its money in the right places or
handling its money correctly, as-much-as, it was a philosophical
opinion. Therefore, anything that the committee would do to the
bill would totally change the philosophical bent of the bill. "So,
I think all of this other information is superfluous to the issue
before us." It was not clear in HB 84 that the intent was to
scrutinize how the money was being spent.
Number 2140
REPRESENTATIVE ELTON replied he agreed with the interpretation of
Chair James. However, before he could make a decision on the bill
he wanted to know the impact on the organizations that would be
excluded and on the charities that they supported.
Number 2150
CHAIR JAMES replied the list that the committee members were going
to get from the Charitable Gaming Division would allow him to do
that.
Number 2160
MR. POSHARD stated that the division could add the amount of net
proceeds that each of the charitable organizations received from
their pull-tab activity. It would take a little bit more time to
prepare the list, however.
CHAIR JAMES replied that was a good idea. She reiterated that
those issues were irrelevant to the intent of the bill; however, to
narrow those organizations that qualified for pull-tabs as a money
making entity.
Number 2208
REPRESENTATIVE HODGINS asked Mr. Poshard if it would be possible to
provide how many of the pull-tab organizations used operators?
Number 2223
MR. POSHARD replied it was another designation that could be added
to the report. It would not be a significant amount; however, not
as much as one-half.
Number 2246
GERALD J. DORSHER, Legislative Officer, Veterans of Foreign Wars,
was the first person to testify in Juneau. Some good points were
raised today in regards to where the committee was going with the
bill. The veterans of foreign wars had for some reason been
designated as a 501(c)(4) when it should be a 501(c)(19). The
department was pursuing the issue at this time through its mother
organization. The department hoped that Representative Martin
would include a 501(c)(4) during the interim of its designation as
a 501(c)(19).
Number 2318
CHAIR JAMES asked Mr. Dorsher if there were any other advantages
for the veterans to be a 501(c)(19) as opposed to a (4), besides a
pull-tab permit?
Number 2331
MR. DORSHER replied, "No." The IRS designated past and present
military organizations as a 501(c)(19).
Number 2340
REPRESENTATIVE AL VEZEY announced that he had the definitions of
the 501(c) designations. A 501(c)(19) was a special classification
for veteran organizations entitling them to a tax-exempt status.
The 501(c)(3) category was not just a public-welfare organization,
but a tax-deductible organization. Many public welfare
organizations did not try to get a tax deductible status -
501(c)(4) and 501(c)(8) - for example. Therefore, we should
consider more than just the 501(c)(3) and 501(c)(19) designations.
There were valid reasons to be a (c)(4) rather than a (c)(19); it
expanded what could be done without jeopardizing the tax-exempt
status.
Number 2408
CHAIR JAMES stated that she did not want to do anything to distress
the veterans. They were the most valued citizens.
Number 2420
GEORGE WRIGHT, Representative, Alaska Native Brotherhood (ANB) Camp
Number 2, was the next person to testify in Juneau. The ANB Camp
Number 2 opposed the bill because it eliminated a lot of the
gambling for villages that use it for a fund raiser. "It would
completely knock the Brotherhood out." It had applied for a
501(c)(3) and (c)(8) status which had not been attained yet. The
Alaska Native Brotherhood Grand Camp was a (c)(8) which covered all
of the ANB camps. The bill, however, did not include (c)(8).
"It's a bad bill." It simply chopped off everything else that was
irrelevant, such as: how it spent its money and how it earned its
money. He was part of a task force to rewrite the gaming rules and
regulations and for some reason neither body had reviewed the
recommendations; for example, to finance the department with extra
man power so that it could go after the people....
TAPE 97-29, SIDE B
Number 0001
MR. WRIGHT further said that the ANB followed the guidelines of a
fraternal organization on the one hand and the guidelines of a
501(c)(3) on the other. The board members were having a hard time
trying to get its certificate with the IRS. Under a 501(c)(3)
designation the organization could not donate money to its members.
"Well everybody in the village is somehow related and that kind of
chopped them off at the knees." How do you break it up if you're
all related and you started this organization and you want to give
money to your son. This is a very bad bill." The ANB did like the
tax-exempt portion of the bill, however. Mr. Elton established the
city sales tax in Juneau to raise revenues from pull-tabs.
Currently, the city taxed the gross dollar amount of sales. If a
ticket sold for $1, the city would put a 4 cents sales tax on every
ticket in the box. The city did not give any consideration to the
price pay-outs or the play-backs. The city taxed the whole amount
which was 39 percent of the ANB's profits. The ANB paid 51 percent
to the city of Juneau because of its tax structure after covering
the cost of business. "They refuse to recognize that the charity
only controls the money that they take to the bank. They don't
control the money that they pay out in prizes. That money is held
in trust until somebody wins it, but they tax it." He suggested if
a bill was going to be written to examine the tax structure, it
would force a lot of people out of business in Juneau then Mr.
Martin would not have to worry about HB 84.
Number 0099
REPRESENTATIVE VEZEY asked Mr. Wright if the ANB was organized
under 501(c)?
MR. Wright replied the grand camp was organized under 501(c)(8).
The ANB Camp Number 2 was a subordinate just like the Moose Lodges.
REPRESENTATIVE VEZEY asked Mr. Wright if he would object to the
bill if it incorporated 501(c)(8)?
MR. WRIGHT replied he would object because some of the villages
could not be that way. For example, the spring carnival in some
villages were the biggest event of the year, of which, pull-tabs
were used to raise money for prizes to draw the people back to the
villages for the carnival. If they wanted to grandfather the bill
then there would not be a problem. If they wanted to eliminate
those that were not operating to the color of the law then let's
take the matter to the Charitable Gaming Division and give it more
investigators. "Two investigators to do 1,600 permits in the state
of Alaska is quite skimpy." He suggested that the committee
members look at the task force rewrites and the recommendations.
Number 0169
REPRESENTATIVE HODGINS asked Mr. Wright to give him information
about the Native groups and how many used operators and where were
they located.
Number 0184
REPRESENTATIVE ELTON commented that Mr. Wright and he had a
history. The city of Juneau did apply a sales tax to pull-tabs in
the same way that it applied a sales tax to a loaf of bread. The
sales tax was not applied to the profit; it was applied to the sale
price.
Number 0200
CHAIR JAMES asked Representative Elton if she paid $1 for a pull-
tab, did she have to pay $1.04?
REPRESENTATIVE ELTON replied in Juneau she would have to pay $1.05.
CHAIR JAMES replied she did not think that was the way it worked.
REPRESENTATIVE ELTON explained the assembly recognized that $1.05
could inhibit the sale of a pull-tab rather than $1. Therefore,
the assembly gave the operators an option to charge $1.05, lower
the pay-out of the game by 5 cents, or absorb the cost. He could
not think of anybody in town charging $1.05 now.
Number 0247
MR. WRIGHT replied, "No." Playing pull-tabs was a sporadic thing.
The ANB did not have a problem paying the tax on the $1 spent. It
had a problem with paying the tax on the ticket that was won
because generally the individual exchanged the winning amount of
the ticket for more tickets. Thus, no money was exchanged; but,
the city took 5 cents for each one of the tickets.
REPRESENTATIVE ELTON replied the city appreciated it.
MR. WRIGHT explained the Ketchikan court ruled that pull-tabs were
intangible objects. It was not a retail product, nor like anything
else that was sold in a store. It was an object sold with a
liability - the price pay-out.
Number 0304
CHAIR JAMES stated this was an interesting conversation. She did
not buy pull-tabs but her husband did. It was called "fun raising"
not "fund raising" at the Elks on Friday nights. She knew that he
was paying only $1 for a ticket which meant that the 5 cents was
coming out of the sale. It was not a tax on the person, therefore.
In this case the seller paid the tax because $1.05 would be very
inconvenient for the buyer.
Number 0376
CHAIR JAMES announced, for the record, that Mr. Minor W. Thomas III
from the Loyal Order of Moose in Juneau, was opposed to HB 84. He
urged it to be defeated and asked that his letter be part of the
record.
"I am sorry that I cannot be there in person to testify on this
bill, however please accept my gratitude for allowing me t submit
written testimony.
"We here at the Juneau Moose and the other lodges around the state
are vehemently opposed to H.B. 84. First, why is Representative
Martin excluding Sec. 501 C-8 organizations from this bill? That
would include all of the Moose lodges in the state and I don't know
how many other organization.
"Moose lodges are organized under 501(C8) as non-profit fraternal
organizations with no political ties and none allowed. We are
organized under a strict members only policy and any monies made by
Moose lodges must come from its members and not the general public.
This includes any pull tab monies we make. It must be remembered
that we support many charities with our pull tab monies as
evidenced with the information packs given to Representative Elton
and Hudson. Along with the information for Juneau, you could look
at the Craig lodge who sent thousands of dollars back into the
community. In fact, they are the major contributor to the
Ambulance Corp. The Petersburg lodge donated over $100,000 back to
the community last year. In Anchorage along last year $123,000 was
given to charity.
"With figures like these it is hard to fathom how anyone could deny
501(C8) organizations the right or privilege to sell pull tabs to
its members.
"If we cannot sell pull tabs who is going to fund and support the
many charities.
"Again, we urge that H.B. 84 be defeated.
"Thank you for your time and consideration."
Number 0401
REPRESENTATIVE MARTIN distributed to the committee members the
report on what was happening to charitable dollars and how the
money got into the political process - directly and indirectly.
Number 0440
CHAIR JAMES asked Representative Martin if he would do this again
after the 1998 campaign to see what the changes would be because of
campaign finance reform?
Number 0449
REPRESENTATIVE MARTIN replied it depended on if he was reelected.
The report showed each individual candidate and how much money came
in from groups that had a pull-tab permit. It also showed how much
went to the political parties and then to the candidates
illustrating the loopholes in the system. He cited the Home
Builders Association raised a lot of money. He did not see how it
was a charitable organization, however.
Number 0519
CHAIR JAMES replied it was a public policy decision to determine if
the organizations met the ordinary understanding of charitable
issues. House Bill 84 would change it so that only recognized
charitable activities would be able to be funded from pull-tabs.
Number 0566
REPRESENTATIVE MARTIN replied this was just the beginning. It was
not to be exclusive of anything. There was confusion with the IRS
in regards to what organization was a charity.
CHAIR JAMES replied she disagreed with the fact that the IRS was
confused. "They tell us who is and who isn't. They aren't
confused about that at all."
REPRESENTATIVE MARTIN replied the IRS was confused in regards to
what Alaska called a charity.
CHAIR JAMES replied the IRS did not care if the state was confused
because they were not confused.
REPRESENTATIVE MARTIN reiterated it was confusing to the IRS in
regards to what the state called charity.
CHAIR JAMES replied that was none of its business. The IRS was a
taxing authority and it could tax the way it wanted to and it was
none of its business what the state did.
REPRESENTATIVE MARTIN replied this was charity and not tax. "If
you're saying in the name of charity that we're letting these
people have all of these millions of dollars then we can stick our
heads in the sand. We don't care if we're going to touch
motherhood and apple pie."
Number 0634
REPRESENTATIVE ELTON stated he understood what Representative
Martin was trying to accomplish. He wondered, however, if it could
be accomplished by drafting legislation that said the proceeds
could only be used in a manner that would be contemplated under
501(c)(3) or 501(c)(19). Therefore, it would not limit those who
could do it, but it would limit how the proceeds could be used.
Number 0662
REPRESENTATIVE MARTIN replied he could have done a thousand
different things. "I do take the challenge of bringing it open and
they're talking about motherhood and apple pie." No one expected
1,600 people to get a pull-tab permit when almost any three or four
individuals could call themselves a non-profit organization and
they did not qualify for the intent of the legislation.
Number 0683
REPRESENTATIVE ELTON replied this was like hunting sparrows with a
shotgun. If there were legitimate purposes by the VFW, for
example, that was a (c)(4) designation, the bill would get rid of
it no matter how it used the proceeds. The better way to approach
this would be to say what the proceeds could be used for rather
than saying who could sell pull-tabs.
Number 0712
REPRESENTATIVE MARTIN replied the challenge for the committee was
to look and to say that Representative Martin was a complete idiot.
The legislature should see what was happening with the money. "If
you don't want to then vote VFW and motherhood." The Chiropractor
Association was not a charitable organization, he declared.
Number 0736
REPRESENTATIVE ELTON asked Representative Martin if the money went
to charities then what was the difference?
REPRESENTATIVE MARTIN replied the Chiropractor Association put a
lot of money into the political process and it put a lot of money
into its own organization; and, yes, it did contribute $250 to a
little league. But, when it gained $50,000 and only gave out $250,
that was not charity.
CHAIR JAMES announced that the bill would be held in the committee.
Number 0766
REPRESENTATIVE ELTON introduced his shadow for the day, Joel
Cladouhos from Juneau Douglas High School. His unfortunate duty
was to follow him around today so he was trying to make it pleasant
for him.
HB 143 - REPEAL ART IN PUBLIC PLACES REQUIREMENT
The next order of business to come before the House State Affairs
Standing Committee was HB 143, "An Act relating to the art in
public places requirements for state-owned and state-leased
buildings and facilities."
CHAIR JAMES called on Representative Al Vezey, sponsor of HB 143,
to present the bill.
Number 0793
REPRESENTATIVE VEZEY stated the bill was really very simple. The
co-essence of the bill was Section 3. The rest of the sections
were technical requirements to implement Section 3. The bill
repealed the requirements in statute for a formula program on how
the state funded art in its public buildings, therefore, removing
the responsibility from the legislature on how it appropriated
state funds. It was not correct or proper that the legislature
tried to shy away from its responsibility to appropriate. "I think
if we want to appropriate money for art that we should make a
deliberate appropriation. I also think that we should defer to
local entities whenever possible as how they should use that money
best for their communities. And a mandate in state statute is not
a proper way to do state business."
Number 0864
REPRESENTATIVE DYSON asked Representative Vezey if this would only
save $34,000? A figure that was presented to him.
Number 0883
REPRESENTATIVE VEZEY replied the bill repealed the Alaska statute
that required 1 percent of the monies appropriated for public
facilities that would go to the procurement of art through the
Alaska State Council on the Arts. If $34,000 was 1 percent of what
the state spent on public facilities, then it was correct.
Number 0904
REPRESENTATIVE DYSON asked Representative Vezey if the fiscal note
was zero? He stated it must cost something to administer this as
a portion of the contracts.
Number 0925
REPRESENTATIVE VEZEY replied this was the third time that he had
introduced this bill. He had seen numerous different fiscal notes
including some zeros. "I don't see this bill as saving money. I
see it as returning to the legislature the responsibility and the
authority of how we appropriate money." The formula absolved the
legislature from its responsibility to appropriate.
Number 0979
CHAIR JAMES responded she remembered the rhetoric in opposition to
the appropriation for art. In her piece of legislation three years
ago she tried to set up a plan to address deferred maintenance in
the state which received the same rhetoric. She asked
Representative Vezey if the bill made this voluntary?
Number 1027
REPRESENTATIVE VEZEY replied the bill removed the statutory
requirement for the formula. It left everything else.
CHAIR JAMES commented she just received information on an
elementary school on Eielson Air Force Base and its art work. She
tallied the individual art pieces to $97,000. She did not remember
what the actual cost was for the school. She asked Representative
Vezey if it said "1 percent" or did it say "a percent" for art?
Was it arbitrary? Where did it say 1 percent?
Number 1132
REPRESENTATIVE VEZEY replied in Title 35 AS 35.27.020(c) it said,
"at least 1 percent". There were a lot of questions involved, and
HB 143 simply removed the statute to remove all of the questions.
He did not know how the statute was interpreted, however. He also
did not know how the legislature could abrogate its responsibility
to appropriate because the formula was applied by the
Administration and not by the legislature.
Number 1173
CHAIR JAMES replied then the $97,000 related to a $9,700,000
school. She asked Representative Vezey when money was asked for a
school was its price included at 99 percent plus the 1 percent for
art? In addition, she asked what would the money be spent on if it
was not spend on art?
Number 1199
REPRESENTATIVE VEZEY replied, "Yes." A contractor usually added 1
percent to its cost-estimate of a project. The other question did
not have an answer. It was up to the legislature.
Number 1228
REPRESENTATIVE HODGINS commented that the state was looking at the
deferred maintenance problem. He asked Representative Vezey if the
law in statute also meant that 1 percent of the appropriation for
deferred maintenance would have to go to art?
REPRESENTATIVE VEZEY replied, "Yes."
REPRESENTATIVE HODGINS asked Representative Vezey if the state
would be taking away from its deferred maintenance and putting it
into art?
REPRESENTATIVE VEZEY replied, "Yes." That was what the formula
said now. It was more complex, however, because a number of public
facilities that were not considered as places to put art also had
to contribute to the program.
Number 1274
REPRESENTATIVE HODGINS asked Representative Vezey if the art that
was actually put into a building became permanent property of that
location or was it moved around?
REPRESENTATIVE VEZEY replied it depended on the appropriation and
who it was to. It belonged to the entity that received the
appropriation and who built the facility.
Number 1300
REPRESENTATIVE HODGINS commented that years ago there was
discussion of putting $40 million dollars into the Homer High
School which related to $400,000 in art that had to go into the
facility which would have been a lot of text books. He thanked
Representative Vezey for bringing the bill forward.
Number 1324
REPRESENTATIVE VEZEY stated that one of the things that continued
to inspire him to bring the bill forward was the fact that museums
were the recipients of a large quantity of valuable art and the art
had no place to go. The art could not be used as the 1 percent for
art according to the regulations.
Number 1358
REPRESENTATIVE ELTON replied one of the things that inspired him
was art. In addition, the fiscal note from the Department of
Transportation and Public Facilities indicated that the money would
go to additional amenities in the building or to higher quality
construction. Furthermore, he did not think that the legislature
had abrogated its responsibility of the appropriation process but
rather it set up a structure of what it wanted to accomplish. The
bill before the committee was the best example because if the bill
passed, it reestablished a change of priority instead of abrogating
its responsibility.
Number 1437
CHAIR JAMES replied she did not know her position on this issue
because she could argue both sides. There had been art in
buildings since the beginning. The difference was whether or not
it should be funded by private sources or it should be taken out of
a capital expense. She would argue for art as a valid thing to
have in buildings. She also agreed with Representative Vezey
having been to the University of Alaska's museum that had a huge
amount of fine art that no one got to see. They did want to built
an extension to the museum so that more of it could be put up. It
was also nice to change the art instead of having the same art in
place. In addition, the art in the elementary school on Eielson
Air Force Base was being created to go along with who the school
was named after. Therefore, the art would not have been created if
the fund had not been there.
Number 1578
REPRESENTATIVE BERKOWITZ replied to Representative Hodgins that
there was not a mandate that all deferred maintenance receive an
art funding. It only had to go to public buildings. Therefore,
a building that was not being used by the public would not require
a art appropriation.
CHAIR JAMES replied the state had a $620 million deferred
maintenance problem at the last count for schools.
Number 1623
REPRESENTATIVE VEZEY replied that Representative Berkowitz was
correct in that the formula did not apply to roads and bridges, but
it did apply to other infrastructure that the public did not use or
occupy, such as sewage treatment plants and prisons. The cost went
back into the formula.
Number 1646
REPRESENTATIVE BERKOWITZ explained AS 44.27.060 stated that the art
requirement was exempt when the building or facility was not
designed for substantial public use which would apply to a sewer
plant.
Number 1667
REPRESENTATIVE VEZEY replied the statute was interpreted and the
way the regulations were written so that there were many public
facilities where the art would not be displayed but the cost was
allocated, except for roads and bridges. The one example that he
recalled looking at was a sewage treatment plant.
Number 1696
REPRESENTATIVE DYSON explained there was 1 percent for the
Anchorage waste water treatment plant. The one unintended result
of all this was the Performing Art Center in Anchorage. It was all
for art and it had to have 1 percent set aside for art which he
felt was an unfortunate restriction and he would have loved to have
spent the money on handicapped access, for example.
Number 1833
JOCELYN YOUNG, Curator of Public Art, Anchorage Museum of History
and Art, was the first person to testify via teleconference in
Anchorage. There was disinformation and misinformation about this
law. The municipal ordinance followed the state statute. In
addition, the museum had found that the this was one of the most
public processes. There was at least one or two people from each
facility, the architect, community members and members of various
commissions within the municipality on the committee. Therefore,
there was ownership of the art for the people living and working in
the building on a day-to-day basis. She had also seen those that
were not very excited about this usually embrace it after seeing
how their organization could be represented in the public. She
cited the art piece in the Anchorage police headquarter training
center became the logo for the department adding a light touch to
its serious role. In addition, the artists in the state receiving
the commission did not receive a chunk of money because they had to
pay for: studio rent, contractors, and electricians, for example.
The money did not just go to one person. The rural school did not
have a 1 percent commission, they had a 0.5 percent commission.
She had also found that the public art throughout the state was
considered a museum without walls because it was accessed by those
that often did not have a chance to go to a museum. "It becomes
there own public art in their own community or school."
Number 2069
DAVID ROSENTHAL was the next person to testify via teleconference
in Cordova. He was against repealing the 1 percent for art. He
had done some art for the state in the past which was meaningful to
him to pass on. He did not believe that by getting rid of the 1
percent for art the legislature would take care of its $600 million
in deferred maintenance or provide wheelchair access. "I don't
believe it's going to save any money and it has been a good thing
for the state." It brought the art to people who normally did not
get the chance to see it. In addition, a wide range of art was
selected because of the public process.
Number 2153
SCOTT HAMANN was the next person to testify via teleconference in
Kenai. He supported HB 143. Art had been in public buildings from
the day that they were built and by getting rid of this 1 percent
for art did not mean that there would not be art. It was a
continual process. However, he did not believe that there should
be a blanket 1 percent. "I think that we need to sit down and look
at every building that we build and decide how much money we want
to spend on art and go ahead and do that." The art could come from
private individuals or it could be donated. It was the
responsibility of the legislature to be frugal with state money.
The money could be better spent.
Number 2269
VICTORIA LORD, Director, Ketchikan Arts Council, was the next
person to testify via teleconference in Ketchikan. She thanked
Representative Vezey for bringing us together every year to
reaffirm the importance of the 1 percent for art program in Alaska
and for giving us the opportunity to remind the legislators that
the program was of value. She disagreed with Representative James
that art just belonged in museums. Art was all around, it added
life and livability to the public spaces. The residents of the
City and Borough of Ketchikan enjoyed fine works of public art and
many were here because of the state mandate. She cited the
airport, pioneers home, public health center, and public schools
housed a variety of art work by a variety of artists. Ketchikan
was proud of the work of its artists that had received commissions
not only in Ketchikan but throughout the Northwest. She cited the
names of the artists who contributed art to the new buildings that
fell under the mandate. As Director of the Ketchikan Arts Council,
she had witnessed the process of selecting the art work. When it
was time to select the art work for the high school the process
included the students.
Number 2439
EMILY MOORE was the next person to testify via teleconference in
Ketchikan. She was a senior at Ketchikan High School. The 1
percent for arts funding was very important. Her freshman year
began in a brand new building which was nice, but it represented a
sterile bathroom. The funds from the 1 percent for arts was a good
program.
TAPE 97-30, SIDE A
Number 0018
MICHAEL OLSON, President, Seward Arts Council, was the next person
to testify via teleconference in Seward. He was also a volunteer
member of the arts selection committee for the new ferry. He
explained the administration cost came from the 1 percent. And the
formula was only calculated from state funds. He opposed HB 143.
In 1975, Alaska took bold steps to recognize the importance of art
by developing the 1 percent for art program. Since that time many
other states had followed and looked up to us. The state of Utah
was the most recent to adopt such a program. It would be ludicrous
for the state to drop the ball now. The 1 percent would not go
back to the General Fund because contractors factored in a 5 to 10
percent contingency for cost overruns and it was this money that
the art work was derived from. If money was the sole reason for HB
143, it was a waste of precious time; there was no bang for the
buck. In 1985, he worked on a project where there was a cost
overrun so 1 percent could not go into the art. Other funds were
raised after the fact.
Number 0233
ANNIE STOKES was the first person to testify in Juneau. She also
thanked Representative Vezey for bringing up this issue again
because it stimulated public dialogue, and it made people really
assess what was important to them. It was apparent from the
comments from the committee members that there was a great deal of
misinformation, confusion, and questions about the bill that no one
had the answers to. She was opposed to HB 143 because it was not
in the best interest of the state. It was premature as was shown
through the questions. In addition, governmental policy was to
bring up a problem, to investigate it, and then to act accordingly.
She reiterated the bill was premature at this point because there
were too many questions. Moreover, HB 143 denied the individuals
that wanted to see their cultures reflected in the public. It was
a public process and those involved had only said positive things
statewide for the program. The artists were selected by the area.
It was a competitive process with stringent procedures to go
through. It also denied the children in the schools who assist
with the projects and watch the process. She cited the art work in
Dzantik'l Heeni Middle School in Juneau. In addition, it also
denied the tourists who came to see the land and to buy art. The
figures indicated that art was a viable industry that should be
supported by the state just like natural resources.
Number 0485
SHANNON PLANCHON, Grant Administrator, Alaska State Council on the
Arts, was the next person to testify in Juneau. She was also the
Percent for Art Coordinator. She distributed to the committee
members a handout titled, "Percent for Art-Samples of Percent for
Art Projects From Across the State." She explained Tim Wilson was
not here today because he was travelling. The council was opposed
to the passage of HB 143. Public art had been commissioned since
the antiquities. "It was one of the important ways that we come to
know and identify our cultures, our buildings, and who we are."
There were over 100 percent for art programs operating in the
United States: the federal government, 29 states, and scores of
cities. Anchorage was the only city in Alaska that had a full-time
percent for art person. At the state level the council operated
without a direct administrative expense offering technical services
to departments that were required to consult with the council per
the statute. In 1986 the Visual Arts Coordinator position was cut
from the program. The council had a strong interest in the 1
percent for art program because it served its constituents and the
public. "We think it's an ideal program, fiscally conservative,
while the state's budget is robust. A small percent of the capital
budget is reserved for it and then when times are tough the
projects are cut back." In addition, art installed became a
permanent part of the building and amortized over the life of the
building. The Art in Public Places Fund was a different pot of
money. It was for buildings that were not used by the public. The
portion that was designated for the art went to the fund to help
augment art in the art banks for portable art. The fund right now
was at $34,000. In conclusion, HB 143 would negatively affect its
two constituencies, the public and the artists. "Public art is
public pride."
Number 0723
ALAN MUNRO was the next person to testify in Juneau. He was a
practicing artist in Juneau. He read the following statement into
the record:
"Art, as painting and sculpture, has made major contributions to
public life and public buildings since the time of the Egyptians,
Greeks and Romans. We continue in that historic tradition to this
day.
"Now, there are certain politicians who would say: `No more!'
"What is the reason? What good purpose could possibly be served by
eliminating art from our daily lives? Is this an anti-art, anti-
intellectual movement or is it simply naivete', due to too little
opportunity to experience meaningful art. Perhaps it is purely a
financial issue, fueled by contractors who would stand to profit by
a little extra money designated for `nice but not necessary' art.
"Supporters of the repeal say: `It is a government give away which
merely supports individual artists who can not make it on their
own.' This is a ridiculous argument, since any money left over
after materials, hard earned wages and taxes would have to last a
very long time between awards. There is no give away here, just an
honest wage in return for talent, professional ability and public
enrichment. We will never know how far Michelangelo would have
been able to go without the financial support of the Vatican. He
also had trouble with individuals in control of that funding
source, over 400 years ago.
"Be that as it may, there does exist a long established art
selection process that very carefully selects the percent for art
recipients. This ensures that , serious artists, producing quality
works of art, are awarded these percent moneys.
"We, of European descent, tent to isolate art from our daily lives
whether we profess to appreciate it or not. Older and wiser
cultures accept art as a given in their daily lives. Art provides
them a dimension of societal well being they would otherwise not
have. Obviously, we have a long way to go before we are as
accepting or as wise. It is one of the reasons why we are gathered
here today.
"Madam chairwoman, I recommend we become more accepting of art.
Let us continue on the centuries long journey other have made
before us. Let us continue this critically important percent for
art program. Let this sadly uninformed and regressive bill die in
Committee."
Number 0906
MIKE ANDERSON was the next person to testify via teleconference in
Cordova. He was a local artist in Cordova amongst the other things
he did for his community. The art created under the percent for
art program added a great deal to the buildings. It also added
public pride and warmth. It also allowed for the preservation of
culture and the creation of art that otherwise would not have been
created on speculation because of to the size of the art work.
"Without these commissions the artists would be relegated to doing
small enough things that would fit in a tourist package and heading
out of the state." The work that he did for the percent for art
project was specifically designed in relation to the durability and
function of the building. Furthermore, he also had worked in the
field of construction. "I know that this will not save 1 percent."
Money going into the windows, for example, was far more than 1
percent. The 1 percent of the 10 percent contingency for bidding
errors and necessary changes was eaten up in no time in the
construction of a building. "I don't think we're going to see any
change in this. We might see a little bit more spendy tile on the
floor. We might see spendier doors, maybe slightly more glass. We
won't hardly see it at all in the buildings." In addition, the 1
percent would not go back to the legislature. "You're not going to
get the warmth of putting artists out of business. The artists
that are already doing this are artists that are going to make it
regardless of whether they're getting a percent for art or not."
Number 1076
JAMES EVENSON was the next person to testify via teleconference in
Kenai. He called HB 143 a bad bill because there was no better
investment than money spent on art. The program was not welfare
for artists, it was not just a matter of putting pretty pictures on
the wall. It was a statement by the government that the art was
important for the lives of the citizens. Everything that was made
by the hands of man had an artistic decision. He cited cars,
tools, and houses as examples. "Art is part of the fabric of our
daily lives. It's just as much so as science or even the oil
industry." Therefore, to eliminate the percent for art program
meant diminishing the quality of life for our people in the schools
and public buildings. He suggested to continue to try to improve
the program for more involvement. "Please do not eliminate this
program."
Number 1178
CARL KRONBERG was the next person to testify via teleconference in
Ketchikan. The art in public requirement was an important and
positive program for the Ketchikan community. The most recent
example was the placement of art in the Ketchikan High School. The
school had been recently rebuilt and the art requirement made it a
more cheerful place for the teachers and the students creating a
better educational environment. The art requirement was also a
valuable public partnership for very little money creating economic
benefits for local communities in tourism, for example.
Number 1267
CAROL BRYNER was the next person to testify via teleconference in
Anchorage. She was an artist and a volunteer at the museum as well
as having served on juries for the public art program in Anchorage.
She travelled quite a bit and looked at how communities showed
itself in its art. There was a big difference between Seattle,
Washington; and Taunton, Massachusetts for example. Last year at
this time she was in Italy where there were lines three hour long
to see art, of which, a lot of it was public art. The bill was a
shortsighted way to look at the future and what we would leave to
our children and grandchildren. "The art that we have around us is
incredibly important. If you look around you and see nothing but
new roads and new bathrooms; it doesn't say much about our
culture." She was opposed to HB 143.
Number 1353
SYBIL DAVIS was the next person to testify in Juneau. She had
lived in Juneau for a long time. She was also a parent and a
person who had been actively involved in the arts and who
appreciated aesthetics. She cited a story when she was seasick on
a missionary trip and the skipper suggested that she focus on the
horizon to help her seasickness. She suggested that the committee
members focus on the horizon now to realize this was something that
would be left long after they were gone. Art was a positive impact
on the environment, it was the culture, it reflected the people,
and 1 percent was not much. If the bill was to pass and the money
was rescinded, it would not go into the capital budget, it would
not get what the committee members were seeking. She was opposed
to the bill.
Number 1421
LYNETTE TURNER, President, Arts for a Healthy Alaska (AHA), was the
next person to testify in Juneau. The AHA was a statewide arts
advocacy organization. The AHA opposed HB 143 because both the
public and the artists benefitted greatly from the program. The
schools and universities would be negatively impacted because so
many of the projects were done there. In addition to decreasing
the degree of exposure that the youth would have, it would also
affect artist's employment. "To walk through a public building and
have the opportunity to be exposed to various types of art can be
a rewarding experience and can have a profound affect." In the
words of playwright, Thornton Wilder, "We can only be said to be
alive in those moments when our hearts are conscious of our
treasures." The arts were a treasure that should be shared.
Please support the 1 percent for art program.
Number 1480
JENANN KIRCHMEIER was the next person to testify via teleconference
in Cordova. She was a practicing artist in Cordova. She had not
been a part of the program but was opposed to eliminating the
percent for art because she felt it was a form of bankruptcy to
look at art in this way when it was such a life enhancing form.
She looked forward to buildings going up so that she could see what
would happen in them. In addition, she had seen first hand in the
villages how the children responded to the art in their schools.
She was opposed to eliminating the 1 percent for art program.
ADJOURNMENT
Number 1540
CHAIR JAMES adjourned the House State Affairs Standing Committee
meeting at 10:05 a.m.
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