Legislature(1995 - 1996)

03/30/1995 08:06 AM House STA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
             HOUSE STATE AFFAIRS STANDING COMMITTEE                            
                         March 30, 1995                                        
                           8:06 a.m.                                           
 MEMBERS PRESENT                                                               
 Representative Jeannette James, Chair                                         
 Representative Scott Ogan, Vice Chair                                         
 Representative Joe Green                                                      
 Representative Brian Porter                                                   
 Representative Ivan                                                           
 Representative Ed Willis                                                      
 Representative Caren Robinson                                                 
 MEMBERS ABSENT                                                                
 COMMITTEE CALENDAR                                                            
 SB 1:     "An Act relating to state implementation of federal                 
           PASSED OUT OF COMMITTEE                                             
 * HB 267: "An Act relating to review and expiration of regulations;           
           and providing for an effective date.                                
           HEARD AND HELD                                                      
 SB 92:    "An Act requiring that, in addition to its operating                
           budget, all activities of the Alaska Housing Finance                
           Corporation are subject to the Executive Budget Act.                
           HEARD AND HELD                                                      
 * HB 269: "An Act relating to credits against certain taxes for               
           contributions to certain public educational radio and               
           television networks and stations and to endowments for              
           public educational radio and television networks; and               
           providing for an effective date.                                    
           PASSED OUT OF COMMITTEE                                             
 SB 5:     "An Act prescribing the use and characteristics of voting           
           booths employed in elections and the color of ballots               
           used in state primary elections.                                    
           SCHEDULED BUT NOT HEARD                                             
 HB 270:   "An Act relating to retirement incentive programs for the           
           public employees' retirement system and the teachers'               
           retirement system; relating to separation incentives for            
           certain state employees; and providing for an effective             
            BILL POSTPONED                                                     
 (*  First public hearing)                                                     
 WITNESS REGISTER                                                              
 SENATOR ROBIN TAYLOR                                                          
 Alaska State Legislature                                                      
 State Capitol Building, Room 30                                               
 Juneau, Alaska 99801-1182                                                     
 Telephone: 465-3873                                                           
 POSITION STATEMENT: Provided sponsor statement for SB 1                       
 CHARLES MCKEE                                                                 
 P. O. Box 143452                                                              
 Anchorage, Alaska 99514                                                       
 Telephone: None                                                               
 POSITION STATEMENT: Supported SB 1                                            
 DELORES FIELDS, Member                                                        
 Alaska Independence Party                                                     
 2050 Resolution Road                                                          
 Fairbanks, Alaska 99712                                                       
 Telephone: 322-2720                                                           
 POSITION STATEMENT: Supported SB 1 and HB 267                                 
 ART GRISWOLD, Member                                                          
 Alaska Independence Party                                                     
 873 Runamuck Ave                                                              
 North Pole, Alaska 99705                                                      
 Telephone: 488-7805                                                           
 POSITION STATEMENT: Supported SB 1 and HB 267                                 
 DALE ANDERSON, Representative                                                 
 Commercial Fisheries Entry Commission                                         
 8800 Glacier Highway                                                          
 Juneau, Alaska 99801                                                          
 Telephone: 789-6160                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 BOB BARTHOLEMEW, Deputy Director                                              
 Income and Excise Audit Division                                              
 Department of Revenue                                                         
 P.O. Box 110420                                                               
 Juneau, Alaska 99801-0420                                                     
 Telephone: 276-5364                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 ELMER LINDSTROM, Special Assistant                                            
 Office of the Commissioner                                                    
 Department of Health and Social Services                                      
 P.O. Box 110601                                                               
 Juneau, Alaska 99811-0601                                                     
 Telephone: 465-3030                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 WILLIS F. KIRKPATRICK, Director                                               
 Division of Banking, Securities and Corporations                              
 Department of Commerce and Economic Development                               
 P.O. Box 110807                                                               
 Juneau, Alaska 99811                                                          
 Telephone: 465-2521                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 DEBORAH BEHR, Assistant Attorney General                                      
 Legislation and Regulations Section                                           
 Department of Law                                                             
 P.O. Box 110300                                                               
 Juneau, Alaska 99811                                                          
 Telephone: 465-3600                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 SHARON BARTON, Director                                                       
 Division of Administrative Services                                           
 Department of Administration                                                  
 P.O. Box 110208                                                               
 Juneau, Alaska 99811                                                          
 Telephone: 465-2277                                                           
 POSITION STATEMENT: Opposed to HB 267                                         
 FRANK DILLON, Executive Director                                              
 Alaska Trucking Association                                                   
 3443 Minnesota Drive                                                          
 Anchorage, Alaska 99503                                                       
 Telephone: None                                                               
 POSITION STATEMENT: Supports HB 267                                           
 JOHN BITNEY, Legislative Assistant                                            
 Representative Martin                                                         
 Alaska State Legislature                                                      
 State Capitol, Room 502                                                       
 Juneau, Alaska 99801                                                          
 Telephone: 465-3783                                                           
 POSITION STATEMENT: Supported SB 92                                           
 TOM WILLIAMS, Legislative Assistant                                           
 Senator Frank                                                                 
 Alaska State Legislature                                                      
 State Capitol, Room 518                                                       
 Juneau, Alaska 99801                                                          
 Telephone: 465-3709                                                           
 POSITION STATEMENT: Provided sponsor statement for SB 92                      
 MICHAEL CHEVALIER, Housing Director                                           
 Anchorage Neighborhood Housing                                                
 3700 Woodland Drive No. 500                                                   
 Anchorage, Alaska 99517                                                       
 Telephone: 243-1558                                                           
 POSITION STATEMENT: Opposed SB 92                                             
 CYNTHIA PARKER, Executive Director                                            
 Anchorage Neighborhood Housing                                                
 3700 Woodland Drive #500                                                      
 Anchorage, Alaska 99517                                                       
 Telephone: 243-1558                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 ROBIN HARRISON, Executive Director                                            
 Tagiugmiullu Nunamiullu Housing Authority                                     
 Barrow, Alaska                                                                
 Telephone: 852-0290                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 BOB MAXWELL                                                                   
 126 Boaters Lane                                                              
 Fairbanks, Alaska 99709                                                       
 Telephone: 479-0592                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 DAN FAUSKE, Corporate Executive Officer                                       
 Alaska Housing and Finance Corporation                                        
 P.O. Box 101020                                                               
 Anchorage, Alaska 99502                                                       
 Telephone: 564-9326                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 JAN SIEBERTS, Senior Vice President                                           
 National Bank of Alaska                                                       
 P.O. Box 100600                                                               
 Anchorage, Alaska 99510                                                       
 Telephone: 265-2991                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 SUE BENEDETTI, President                                                      
 Alaska Mortgage Bankers Association                                           
 P.O. Box 100720                                                               
 Anchorage, Alaska 99510                                                       
 Telephone: 273-5637                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 JOHN EGAN, Volunteer President                                                
 Housing First                                                                 
 231 Gastineau Avenue                                                          
 Juneau, Alaska 99801                                                          
 Telephone: 463-3303                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 TAMARA ROWCROFT,  General Manager                                             
 Alaska Housing Development Corporation                                        
 1800 Northwood Ave                                                            
 Juneau, Alaska 99801                                                          
 Telephone: 780-4533                                                           
 POSITION STATEMENT: Opposed to SB 92                                          
 TOM WRIGHT, Legislative Assistant                                             
 Representative Ivan                                                           
 Alaska State Legislature                                                      
 State Capitol, Room 503                                                       
 Juneau, Alaska 99801-1182                                                     
 Telephone: 465-4942                                                           
 POSITION STATEMENT: Provided sponsor statement for HB 269                     
 PREVIOUS ACTION                                                               
 BILL:  SB   1                                                               
 SPONSOR(S): SENATOR(S) TAYLOR,Kelly,Halford,Sharp                             
 JRN-DATE      JRN-PG              ACTION                                      
 01/06/95        12    (S)   PREFILE RELEASED - 1/6/95                         
 01/16/95        12    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 01/16/95        13    (S)   STATE AFFAIRS, JUDICIARY                          
 02/07/95              (S)   STA AT 03:30 PM BELTZ ROOM 211                    
 02/07/95              (S)   MINUTE(STA)                                       
 02/08/95       204    (S)   STA RPT  2DP 2NR                                  
 02/08/95       204    (S)   FN(S):DOT #9,REV #13,DPS #14                      
                             LAW #15                                           
 02/08/95       204    (S)   DHSS #16, F&G #17, DCRA #18                       
 02/08/95       204    (S)   ZERO FN(S): (DNR #1, DMVA #2,                     
                             DOE #3,#4,                                        
 02/08/95       204    (S)   CORR #5,DCED #6,ADM #7,GOV #8,LABOR               
 02/08/95       204    (S)   #10, F&G #11, DEC #12)                            
 02/08/95       209    (S)   JUD REFERRAL WAIVED                               
 02/08/95       209    (S)   FIN REFERRAL ADDED                                
 03/02/95       454    (S)   FIN RPT  4DP 3NR                                  
 03/02/95       454    (S)   ZERO FISCAL NOTE (S.FIN/ALL                       
                             DEPTS #19)                                        
 03/02/95              (S)   FIN AT 09:00 AM SENATE FINANCE 520                
 03/03/95              (S)   RLS AT 11:20 AM FAHRENKAMP RM 203                 
 03/03/95              (S)   MINUTE(RLS)                                       
 03/08/95       537    (S)   RULES TO CALENDAR  3/8/95                         
 03/08/95       539    (S)   READ THE SECOND TIME                              
 03/08/95       539    (S)   ADVANCE TO 3RD READING MOTION                     
 03/08/95       539    (S)   THIRD READING 3/9  CALENDAR                       
 03/09/95       559    (S)   READ THE THIRD TIME  SB 1                         
 03/09/95       559    (S)   PASSED Y11 N8 E1                                  
 03/09/95       565    (S)   TRANSMITTED TO (H)                                
 03/10/95       696    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/10/95       696    (H)   STATE AFFAIRS, FINANCE                            
 03/15/95       755    (H)   WTR REFERRAL ADDED                                
 03/22/95       868    (H)   WTR REFERRAL WAIVED                               
 03/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 03/28/95              (H)   MINUTE(STA)                                       
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HB 267                                                                
 SHORT TITLE: REGULATION REVIEW AND EXPIRATION                                 
 SPONSOR(S): REPRESENTATIVE(S) JAMES,Kelly                                     
 JRN-DATE     JRN-PG               ACTION                                      
 03/17/95       779    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/17/95       779    (H)   STATE AFFAIRS, FINANCE                            
 03/20/95       825    (H)   COSPONSOR(S): KELLY                               
 03/23/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 03/23/95              (H)   MINUTE(STA)                                       
 03/28/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 03/28/95              (H)   MINUTE(STA)                                       
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  SB  92                                                                
 SHORT TITLE: AHFC SUBJECT TO EXEC. BUDGET ACT                                 
 JRN-DATE     JRN-PG               ACTION                                      
 02/21/95       349    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 02/21/95       349    (S)   STA, FIN                                          
 02/28/95              (S)   STA AT 03:30 PM BELTZ ROOM 211                    
 02/28/95              (S)   MINUTE(STA)                                       
 03/01/95       436    (S)   STA RPT  4DP                                      
 03/01/95       436    (S)   ZERO FISCAL NOTE (REV #1)                         
 03/15/95       617    (S)   FIN RPT  6DP 1NR                                  
 03/15/95       617    (S)   PREVIOUS ZERO FN  (REV #1)                        
 03/15/95              (S)   FIN AT 09:00 AM SENATE FINANCE 532                
 03/15/95              (S)   MINUTE(FIN)                                       
 03/16/95              (S)   RLS AT 12:00 PM FAHRENKAMP RM 203                 
 03/16/95              (S)   MINUTE(RLS)                                       
 03/17/95       664    (S)   RULES TO CALENDAR  3/17/95                        
 03/17/95       666    (S)   READ THE SECOND TIME                              
 03/17/95       666    (S)   ADVANCED TO THIRD READING UNAN                    
 03/17/95       666    (S)   READ THE THIRD TIME  SB 92                        
 03/17/95       666    (S)   PASSED Y18 N- E2                                  
 03/17/95       679    (S)   TRANSMITTED TO (H)                                
 03/20/95       802    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/20/95       802    (H)   STATE AFFAIRS, FINANCE                            
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HB 269                                                                
 SPONSOR(S): REPRESENTATIVE(S) IVAN,Bunde,Foster,Williams                      
 JRN-DATE     JRN-PG               ACTION                                      
 03/20/95       813    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/20/95       813    (H)   STATE AFFAIRS, FINANCE                            
 03/24/95       920    (H)   COSPONSOR(S): FOSTER                              
 03/29/95       987    (H)   COSPONSOR(S): WILLIAMS                            
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  SB   5                                                                
 SHORT TITLE: ELECTION BALLOTS                                                 
 SPONSOR(S): SENATOR(S) KELLY,Salo                                             
 JRN-DATE      JRN-PG              ACTION                                      
 01/06/95        14    (S)   PREFILE RELEASED - 1/6/95                         
 01/16/95        14    (S)   READ THE FIRST TIME - REFERRAL(S)                 
 01/16/95        14    (S)   STA, FIN                                          
 02/14/95              (S)   STA AT 03:30 PM BELTZ ROOM 211                    
 02/14/95              (S)   MINUTE(STA)                                       
 02/16/95       315    (S)   STA RPT  CS  3DP 1NR   SAME TITLE                 
 02/16/95       315    (S)   ZERO FISCAL NOTE  (GOV #1)                        
 03/02/95       454    (S)   FIN RPT  6DP 1NR (STA)CS                          
 03/02/95       454    (S)   ZERO FN (GOV #1)                                  
 03/02/95              (S)   FIN AT 09:00 AM SENATE FINANCE 520                
 03/03/95              (S)   RLS AT 11:20 AM FAHRENKAMP RM 203                 
 03/03/95              (S)   MINUTE(RLS)                                       
 03/14/95       600    (S)   RULES TO CALENDAR  3/14/95                        
 03/14/95       603    (S)   HELD TO 3/15 CAL FOR 2ND RDG                      
 03/15/95       619    (S)   READ THE SECOND TIME                              
 03/15/95       619    (S)   STA  CS ADOPTED UNAN CONSENT                      
 03/15/95       619    (S)   ADVANCED TO THIRD READING UNAN                    
 03/15/95       619    (S)   READ THE THIRD TIME  CSSB 5(STA)                  
 03/15/95       619    (S)   PASSED Y19 N- E1                                  
 03/15/95       635    (S)   TRANSMITTED TO (H)                                
 03/17/95       764    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/17/95       765    (H)   STATE AFFAIRS, FINANCE                            
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 BILL:  HB 270                                                               
 SHORT TITLE: RETIREMENT INCENTIVE PROGRAM                                     
 SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                  
 JRN-DATE     JRN-PG               ACTION                                      
 03/20/95       813    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 03/20/95       814    (H)   STA, L&C, FINANCE                                 
 03/20/95       814    (H)   2 FISCAL NOTES (ADM)                              
 03/20/95       814    (H)   INDETERMINATE FN (GOV/ALL DEPTS)                  
 03/20/95       814    (H)   GOVERNOR'S TRANSMITTAL LETTER                     
 03/30/95              (H)   STA AT 08:00 AM CAPITOL 102                       
 ACTION NARRATIVE                                                              
 TAPE 95-38,  SIDE  A                                                          
 Number 000                                                                    
 The meeting of the House State Affairs Standing Committee was                 
 called to order by Chair Jeannette James at 8:06 a.m.  Members                
 present at the call to order were Representatives James, Ogan,                
 Green and Porter.  Representatives Ivan, Willis and Robinson                  
 arrived later.                                                                
 CHAIR JEANNETTE JAMES stated there was a quorum present and                   
 announced the first bill on the agenda was SB 1.  She called                  
 Senator Robin Taylor, as the bill sponsor, to testify.                        
 SB 1 - REVIEW OF FEDERALLY MANDATED PROGRAMS                                
 SENATOR ROBIN TAYLOR introduced himself and commented about an                
 airline whose brakes failed with him as a passenger in Petersburg.            
 He said he introduced SB 1 as a companion bill to his Tenth                   
 Amendment resolution, SJR 7.  He stated this resolution demands               
 that the U.S. Congress stop passing legislation which exceeds its             
 authority under the Tenth Amendment of our Constitution.  SB 1, he            
 said, is an attempt to identify federal mandates, both statutory              
 and regulatory, to see which of these conflict with the policies of           
 our state and the limits of our state Constitution.  He commented             
 he thought the agencies would be doing this already, but received             
 all sorts of strange fiscal notes, indicating how much expense this           
 would be the implement.  He said, hopefully, this would provide               
 them with a vehicle to focus their attention on those mandates                
 worth reviewing.  He stated SB 1 would require an annual review by            
 the Executive Branch of each program mandated by Congress and audit           
 by the Governor.  The Legislative Budget and Audit Committee would            
 adopt conclusions and make recommendations for changes in the                 
 federal law to make a program more consistent with state policy or            
 more cost-effective.  At the same time, a determination could also            
 be made with the Department of Law, to see if the mandate exceeds             
 federal authority under the Tenth amendment.  He stated Section 1             
 of the bill finds there is an urgent need for this review and the             
 bill also allows for legislative review of federal mandates and the           
 Legislative Budget and Audit Committee would be charged with making           
 those recommendations.  He thought SB 1 would add credence to the             
 legislatures passage of SJR 7.  He pointed out the Senate Finance             
 Committee zeroed out the various fiscal notes submitted by the                
 different agencies of state government.  They felt the information            
 for conducting this review were already available to the agencies,            
 and so there was no need for additional staff.  On March 9, the               
 Senate passed SB 1 by vote of 11 to 8.  He urged quick passage of             
 the bill from committee and expressed appreciation to Chair                   
 Jeannette James for hearing the bill.                                         
 Number 075                                                                    
 CHAIR JAMES asked if there were any questions from the committee              
 for Senator Taylor.  She asked if anyone else wished to testify on            
 the bill.                                                                     
 CHARLES MCKEE testified via teleconference from Anchorage, saying             
 he approved of this bill as it could relieve the impact of federal            
 intrusion on many different entities, from the permanent fund to              
 the oil industry.  He thought this bill made a slight attempt to              
 redress his fiscal difficulties and would help the legislature in             
 dealing with the state budget.                                                
 Number 141                                                                    
 DELORES FIELDS, Member, Alaska Independence Party stated she was a            
 proud member of the Alaska Independence Party and supported SB 1,             
 because federal mandates needed to be reviewed before being                   
 implemented by the state.  She thought the mandates coming from the           
 federal government did not always comply with the policies of the             
 Number 170                                                                    
 CHAIR JAMES recognized the arrival of Representatives Willis and              
 Ivan at 8:11 a. m.  She asked if there was anyone else wishing to             
 testify on teleconference.                                                    
 ART GRISWOLD, Member, Alaska Independence Party, said he also                 
 wanted to testify in favor of SB 1.  He mentioned he was speaking             
 on behalf of the Interior Region of the Alaska Independence Party,            
 who found the provisions of this bill would help protect states               
 rights and those of the citizens of this state from those unfunded            
 mandates of the federal government that do not pertain to the needs           
 of Alaska.  He pledged the support of the Alaska Independence Party           
 in getting passage of SB 1 through the legislature.                           
 Number 188                                                                    
 REPRESENTATIVE SCOTT OGAN asked Senator Taylor if he thought it               
 might be better to conduct this review of federal mandates over a             
 four year period, instead of annually.  He recognized the bill had            
 a zero fiscal note, but thought many of the mandates would not                
 change annually, and so would not be in need of review.                       
 SENATOR TAYLOR said he had considered this, but was fearful that              
 should they allow a review over four years, some administrations              
 might not start the review until the fourth year.  He added he did            
 not trust a Republican majority in Congress any more than he had              
 trusted a Democrat majority in Congress. He thought Republicans               
 were just as likely to force silly legislation on Alaska, just as             
 much as the Democrats did.  He thought the danger of losing our               
 civil liberties was always in jeopardy whenever you convene a                 
 congress or state legislature.  He quoted Benjamin Franklin, who              
 said Men are plowing quietly in the fields and women weeping                  
 silently in the kitchens of this land, for the legislature is in              
 session and no mans life or property is safe.                                 
 CHAIR JAMES verified there was no further questions from the                  
 committee and asked for a motion to pass SB 1 out of committee.               
 Number 244                                                                    
 REPRESENTATIVE OGAN stated he would be privileged and honored to              
 move to pass SB 1 out of committee with zero fiscal note and                  
 individual recommendations.                                                   
 CHAIR JAMES asked if there were any objections from the committee.            
 Hearing none, the bill passed out of committee.                               
 HB 267 - REGULATION REVIEW AND EXPIRATION                                   
 Number 265                                                                    
 CHAIR JAMES announced the next bill on the agenda was HB 267.  She            
 called this a simple bill that would provide for all regulations to           
 expire on June 30, unless extended by act of the legislature.                 
 This, she said, would provide a mechanism of oversight by the                 
 legislature and a means of eliminating those regulations not                  
 meeting the intent of the legislature.  She said she had many                 
 conversations with  the Administration on this bill and planned to            
 just take testimony at that meeting.  She would then take the                 
 suggestions from testimony and draft a proposed committee                     
 substitute for consideration by the committee at the next meeting.            
 She asked if there was any questions or comments from the committee           
 before they heard the testimony.  Hearing none, she heard from                
 those testifying on teleconference.                                           
 Number 305                                                                    
 DELORES FIELDS, member of Alaska Independence Party, supported HB
 267.  She thought there were too many regulations, some of which              
 were in conflict with the Constitution, and that they needed to be            
 reviewed by the legislature.                                                  
 ART GRISWOLD, member of the Alaska Independence Party, thought HB
 267 would allow for a regular evaluation of the regulatory process,           
 without extra hassle by the legislature to try and repeal a                   
 regulation it disagrees with.  He thought this bill would allow the           
 legislature some oversight of regulations and grant the Governor              
 the chance to veto, if they choose.  He thought this bill had been            
 developed with considerable thought and hoped it passed through               
 committee without difficulty.  He said this bill had the support of           
 the Interior Region organization of the Alaska Independence Party.            
 Number 342                                                                    
 CHAIR JAMES asked if anyone else on teleconference wished to                  
 testify on HB 267.  Hearing none, she asked who wished to testify             
 from the audience.                                                            
 DALE ANDERSON, Representative of the Alaska Commercial Fisheries              
 Entry Commission, said the commission had been created twenty years           
 ago, to help bring stability to the fishing industry.  He thought             
 HB 267 would be devastating to the agency, as the stability they              
 were striving for would cease to exist.  He could not see why                 
 anyone would invest in a permit, which may expire the next year               
 along with the agencys regulations.  He doubted the state loan                
 agency could justify its investment of over $84 million in permits            
 and fishing vessels under such a system.  He said the commission              
 could understand the need for checks and balances and regulatory              
 reform, but thought such a broad bill was too much.  He said a                
 quasi-judicial commission such as theirs, demands permanence in               
 order to safeguard the adjudicatory process in which they are                 
 involved.  Thus, they asked for an exemption to their commission              
 from the effects of HB 267, to help maintain the integrity and                
 stability found in the limited entry system.                                  
 BOB BARTHOLEMEW, Deputy Director for the Income and Excise Tax                
 Division in the Department of Revenue, thought the greatest impact            
 to their agency would be in sections 5, 6, and 8 of HB 267.  He               
 said currently, the agency has four programs with significant                 
 regulations, the Oil and Gas Tax Division, Corporate Income and               
 Excise Tax Division, Permanent Fund Dividend Program, and the                 
 Charitable Gaming Division.  He said the regulations for those                
 programs had been established with considerable effort and should             
 those regulations go away, they felt the revenue laws would not               
 function and the state would experience a loss of revenue.  He                
 cited the production tax on North Slope Oil as an example.  He                
 thought it was necessary to either have the regulations in place,             
 or move them into statute.  Finally, he thought this would possibly           
 create instability in the business climate of the state.  He urged            
 the committee to consider a way of allowing the legislature to be             
 involved in the drafting process, before they are signed into law.            
 He said the Department of Revenue would like to find a way of                 
 working within the current process, rather than having all                    
 regulations expire annually.                                                  
 CHAIR JAMES thanked Mr. Bartholemew for his comments on having the            
 legislature get involved in the drafting of regulations.  She said            
 this was part of the concept behind HB 105, her comprehensive                 
 overall regulation reform bill.  She explained the motivation                 
 behind HB 267 was that the legislature currently has no authority             
 to change regulations.  They can only make suggestions.  She said             
 there were two ways to change this, HB 267 and HJR 1, which would             
 give the legislature the ability to annul regulations by concurrent           
 resolution.  She did not feel the legislature would expire those              
 regulations having to due with the tax program.  She pointed out,             
 that in those states with this type of law, there was more of an              
 attitude of cooperation between the legislature and the agencies in           
 developing regulations that were more user friendly to the public.            
 She asked if Mr. Bartholemew would feel better if there was a                 
 provision in the bill that would set a deadline as to when the bill           
 had to pass the legislature.                                                  
 MR. BARTHOLEMEW thought the biggest concern of the Department of              
 Revenue was the possibility of all regulations expiring annually.             
 He thought there would be considerable discussion on the bill as it           
 went through the committee process and debate as to which                     
 regulation should be included and which one left out.  Thus, the              
 agency would still be concerned about the possibility of all                  
 regulations expiring.                                                         
 CHAIR JAMES mentioned there were other states doing this already              
 and it was working fine.  She said that with regards to whether               
 this would be a deterrent to industry, this had not been the case             
 in Colorado and Utah, who had this law.  She said in discussions              
 with officials in Utah, they viewed this law as a business                    
 incentive.  She pointed out that Salt Lake City and Denver were               
 thriving business hubs of the West Coast.  Thus, she did not see              
 this bill as a deterrent to business.                                         
 ELMER LINDSTROM, Special Assistant, Office of the Commissioner,               
 Department of Health and Social Services, said he would not take              
 much time testifying, as he had testified before the committee on             
 earlier regulation reform bills and their concerns on this bill               
 were largely the same.  He stated their biggest concern was that              
 the department participated in many federal programs and federally            
 funded programs, and should their regulations expire, the                     
 department would face the risk of losing these funds.  Another area           
 of concern was there licensing programs, which would possibly be              
 problematic if they could not readopt these regulations in                    
 substantially the same form.  He felt an underlying theme of this             
 bill was that the majority of regulations are bad and in need of              
 review.  He thought this was not the case, that it was only a very            
 few.  He suggested there be an exemption to regulations mandated by           
 the federal government.                                                       
 Number 579                                                                    
 CHAIR JAMES said she thought he had made her point, in that many of           
 the regulations were not problematic and would not be expired by              
 the legislature.  She thought he was in error in suggesting the               
 legislature would not be as sensitive as the Administration in                
 their oversight of regulations.  She thought they would be more               
 sensitive, in that they were responsible for lawmaking and the                
 budget of the state.  Thus, she did not feel it was a fair estimate           
 to think the legislature was incompetent to deal with these issues.           
 She pointed out the other option was HJR 1, allowing the                      
 legislature to annul regulations by resolution, which passed the 34           
 to 4 on the House floor.  She felt there could only be meaningful             
 oversight of regulations by the legislature if they had some form             
 of a hammer to hold over the agencies.  HB 267 was meant to provide           
 a hammer for the legislature to allow for meaningful oversight of             
 the regulatory process.  She thought there had to be a system set             
 up to allow for the legislature, agencies, and public to have                 
 meaningful input into the regulatory process.                                 
 Number 594                                                                    
 WILLIS KIRKPATRICK, Director, Division of Banking, Securities, and            
 Corporations, Department of Commerce and Economic Development, said           
 his testimony would reflect the regulatory process and concerns of            
 all of the agencies of the department.  He mentioned the department           
 decided, two years ago, that it was time to recodify the banking              
 regulations of the state.  During this process, it became quite               
 evident, that banking is a rapidly changing industry.  Thus, they             
 decided to forego the legislative process in writing statutes and             
 incorporate most of the changes in regulation.  As an example, the            
 legal investment list of where banks may invest funds is constantly           
 changing and these changes are incorporated into regulations.  As             
 he became aware of HB 267, he also became aware that other states             
 already had this law.  One of these was Utah, which like Alaska has           
 a system of state chartered banks and a bank holding company,                 
 Keycorp.  This system requires state chartered banks to be                    
 consistent and uniform in their procedures.  Being concerned about            
 his regulations expiring annually, he called banking officials in             
 Utah to see how the system worked for them.  He said it was their             
 understanding that the legislature introduced a bill specifying               
 those regulations scheduled to sunset.  This would relieve his                
 concern about all of his regulations being up for possible sunset.            
 He cited examples of how the Department of Commerce measures which            
 state is the easiest state to do business in.  He said their                  
 findings were that states with a consistent business climate are              
 easier to do business in those that are constantly changing.  Thus,           
 he was concerned we could be hurting our business climate with this           
 bill.  He was also concerned about the provision of the bill that             
 allows an agency to readopt a regulation, but not in substantially            
 the same form.                                                                
 TAPE  95-38,  SIDE B                                                          
 Number 000                                                                    
 CHAIR JAMES responded the law in Utah extended all regulations                
 except those listed for sunset.  She did not feel the banking and             
 commerce laws were ever likely to be on the sunset list.  She added           
 that Utah had a further provision, that allowed the Governor to               
 extend the life of a regulation the agency has scheduled for                  
 sunset, should the agencies justify the need for this regulation to           
 them.  She thought the legislature having the ability to do this,             
 would lead to an environment of increased cooperation between the             
 agencies and the legislature and most of these problems would be              
 fixed before a regulation was scheduled for sunset by the                     
 legislature.  She said this bill just provided the legislature with           
 some oversight of the regulatory process they have delegated to the           
 Administration.  She saw this bill as a slight deviation from                 
 current process to give the legislature some meaningful input into            
 the regulatory process.  She pointed out that most of the                     
 regulations Mr. Kirkpatrick was referring to were already supported           
 by statutory authority of the legislature.  She said this bill was            
 not meant to be a picking of individual philosophy, as much as it             
 was meant to allow the legislature to verify regulations were                 
 meeting the intent of the legislature.  Thus, she felt there would            
 be very few regulations being sunsetted by the legislature under              
 this criteria.                                                                
 Number 074                                                                    
 DEBORAH BEHR, Regulations Attorney, Department of Law, said she was           
 pleased to offer comments on HB 267.  She urged the committee to              
 hold this bill over until the interim.  She said her first concern            
 about this bill was the number of regulations there were in state             
 law.  She mentioned there were about 10,000 pages of regulations in           
 law currently.  She was not sure how much work the Administrative             
 Regulation Review Committee could accomplish over the interim in              
 reviewing regulations.  She said she had been told by by the                  
 sponsor that the committee would be reviewing those problematic               
 regulations brought to its attention.  If this was the case, she              
 wondered why put a cloud over all regulations to deal with the few.           
 After receiving this bill, she did some research on which of the              
 states currently had this law in effect.  She found there were four           
 states, Colorado, Utah, Tennessee and Ohio.  She was curious of the           
 staffing this bill required to implement and said she found the               
 state of Colorado told her they had 15 attorneys on staff who                 
 worked on this part-time.  Utah had two full-time attorneys on                
 staff to deal with regulations.  She thought there would also be              
 some additional costs to the Administration.  One area of concern             
 to her was Section 8 of the bill, that required the agencies to               
 submit certain documentation to the committee after adopting,                 
 repealing, or amending a regulation.  She thought this was                    
 unnecessary paperwork, which would add cost to the administration.            
 On page 4, lines 25-27, there was a requirement that the agency               
 identify persons who opposed or supported the regulation.  She                
 thought this was sometimes unable to be determined.  She offered an           
 example from her review of the regulations on abortion.  She was              
 also concerned about page 4, lines 28-30 require the identification           
 of any Attorney Generals opinion or judicial decisions relevant to            
 the regulation change.  She thought again, the amount of paperwork            
 for this requirement could be overwhelming and a cost to the                  
 Administration.  She also saw a potential cost in the possibility             
 of boards and commissions having to meet to provide information to            
 the committee or to redraft a regulation that has been sunsetted.             
 She was also concerned about the legal issues involved with this              
 bill.  She mentioned she had called the four states with this law             
 to see if any of them had had a court challenge and none of them              
 had.  She was also concerned about whether doing an omnibus bill              
 would violate the single-subject rule of legislation.  She was                
 aware of the fact that legislative legal counsel did not see a                
 problem, but thought this was still an area of uncertainty.  She              
 thought this could create an unstable regulatory climate for                  
 business.  She thought this bill could also violate the ALIVE v.             
 Alaska case of 1980, in that she thought it removed the veto                 
 authority of the Governor.  She thought, at best, these legal                 
 issues were unresolved.  She thought there was a better method,               
 where the Administrative Regulation Review Committee could review             
 regulations and draft a statute to repeal those individual                    
 regulations.  She thought the Governor would be unlikely to veto              
 such a bill.  She claimed this could give the legislature a more              
 active oversight of regulations.  She also expressed concern about            
 the date of June 30 for the annual sunset of regulations.  She                
 offered to work with the committee over the interim on regulation             
 reform.  She also was concerned about the language in the bill,               
 that prohibited the agency from readopting a regulation in                    
 substantially the same form.  She offered to answer any questions             
 of the committee.                                                             
 Number 316                                                                    
 CHAIR JAMES commented she did not see those kinds of disaster                 
 situations happening that Ms. Behr described, as she had more                 
 confidence in the legislatures ability to make decisions.  She                
 thought they would be just as prudent as the Administration if not            
 more so.  She said her past experience had been the legislature               
 does not make those kinds of decisions that cause the kinds of                
 disasters described.                                                          
 REPRESENTATIVE BRIAN PORTER thought there was a valid concern over            
 the legislatures sunset of regulations without the Governors                  
 ability to veto.  He thought there was a possible answer in                   
 borrowing Utahs provision of allowing the Governor to extend a                
 regulation the legislature has scheduled for sunset, or by a                  
 provision that would sunset a regulation with a date set by the               
 legislature for its expiration.                                               
 MS. BEHR thought there was some merit in the idea of sunsetting a             
 regulation on a date determined by the legislature, as done with              
 various commissions, but said she could only address the bill as it           
 was currently written.  She was concerned about the provision of              
 Utah, allowing the governor some input, that there was some legal             
 problems with allowing the Governor to extend a sunset without                
 having to go through the same committee hearing process the                   
 legislature has to do.  She also failed to understand why, if this            
 were a good idea, only four states have adopted similar laws to               
 Number 361                                                                    
 REPRESENTATIVE JOE GREEN asked if any of the four states with this            
 law had similar constitutional problems to ours with this bill.               
 MS. BEHR said she asked them and was told there had never been a              
 court challenge.  She said she specifically addressed the                     
 single-subject rule and got mixed results.  Some Attorney Generals            
 didnt think there was a legal problem and others were unsure.                 
 None of them had experienced a legal challenge to the laws in their           
 states.  Ms. Behr thought this was an open legal question and that            
 there would be legal opinions on both sides.                                  
 CHAIR JAMES agreed and stated there was a memo in the committee               
 packets from Legislative Legal Services, who did not feel there was           
 a legal problem with the single-subject rule.  They felt this was             
 no different than any of the omnibus bills that extend commissions            
 or the Administrative Procedures Act itself.                                  
 REPRESENTATIVE GREEN still wondered if the reason the other states            
 did not experience legal challenge on this law was because they had           
 constitutions that granted differing authority to the legislature             
 than ours.                                                                    
 MS. BEHR stated her research had indicated that three of the states           
 did not think there was a legal issue and the fourth thought it was           
 an unresolved legal issue.  She said she could not say what the               
 decision of Alaska courts would be on this issue.                             
 CHAIR JAMES asked if there were any other questions for Ms. Behr.             
 She called for Sharon Barton to testify.                                      
 SHARON BARTON, Director of Administrative Services, Division of               
 Administrative Services, Department of Administration, said she               
 could add very little to the comments of her fellow colleagues in             
 the administration.  She wanted to echo their general concerns.               
 She concurred the additional information required in Section 8 was            
 going to be costly and thought a better method would be to make               
 this information available on request of the committee.  She also             
 thought there would be greater monitoring of the legislation by the           
 agencies leading to greater costs.  She also did not think the                
 agencies would have the information available to provide the                  
 committee regarding the judicial decisions on a particular                    
 regulation, and so would experience an increase in cost.  She                 
 thought maybe regulation reform would be something to spend more              
 money on, but would want assurances the benefit was going to                  
 warrant the additional cost.                                                  
 Number 435                                                                    
 FRANK DILLON, Executive Director of the Alaska Trucking                       
 Association, supported HB 267.  He said the trucking industry is              
 regulated by a variety of regulations, both state and federal.  He            
 claimed over the last decade, regulations had gotten out of sync              
 with reality.  He offered an example to illustrate his point.  He             
 discussed the requirement of the state that all employers have an             
 employee bulletin board, listing pertinent and necessary                      
 information to the employee.  This should be pretty                           
 straight-forward and easy to comply with.  He said the problem was            
 that the information required to be on this board was distributed             
 by approximately nine different agencies and consisted of about 50            
 items that should be listed on the board.  He spoke of a letter               
 from the prior Governors Administration that ended with a                     
 statement to not consider the letter as a definitive answer to his            
 questions, as they did not know for sure what was required to be on           
 those bulletin boards.  He thought this was pretty symptomatic of             
 the entire regulatory system and was greatful for Chair James                 
 introduction of this and other regulatory reform bills.  He                   
 recognized this could be a terrifying prospect to those in the                
 agencies, but felt that many if not most of the regulations no                
 longer accomplish their stated purpose or legislative intent.  He             
 also argued that the main purpose for writing regulations, in his             
 experience with the agencies, was job security.  He thought                   
 regulations were supposed to be written to protect the public, but            
 when they get so confusing to private industry, many businesses               
 give up trying to comply.  He hoped that with the review of                   
 regulations proposed by HB 267, it would be possible to weed out              
 bad regulations and write new ones that would be better and easier            
 to comply with.  He wanted to reiterate his support for HB 267.               
 Number 479                                                                    
 MR. MCKEE said he supported the concept of the bill, but felt there           
 could be an amendment on page two, line 20 and line 23, which                 
 references common law of the state.  He thought this should be                
 changed to common law of the individual.  He thought this would               
 better address his earlier references to property rights.                     
 Number 507                                                                    
 CHAIR JAMES asked if there was anyone else from the public wishing            
 to testify.  She said her intention was to send this to a quick               
 subcommittee for some amendments and then recalendar it for the               
 next meeting.  She said it would be open to any of the committee              
 members who wished to work with her and the administration on a               
 proposed committee substitute for this bill.                                  
 REPRESENTATIVE ED WILLIS expressed his interest in participating on           
 the subcommittee.                                                             
 REPRESENTATIVE PORTER also expressed his interest.                            
 Representative Robinson arrived at 9:25 a. m.                                 
 CHAIR JAMES stated the next bill on the agenda SB 92 by House Rules           
 at the request of the Legislative Budget and Audit Committee.                 
 SB 92 - AHFC SUBJECT TO EXEC. BUDGET ACT                                    
 JOHN BITNEY, Legislative Assistant, Representative Terry Martin,              
 Legislative Budget and Audit Committee, said SB 92 was sponsored by           
 the Legislative Rules Committee at the request of the Legislative             
 Budget and Audit Committee.  He stated SB 92 was introduced at the            
 unanimous request of LB&A.  The concerns about the Alaska Housing             
 and Finance Corporation were initially raised by Senator Steve                
 Frank, who introduced the bill to the committee.   He said Senator            
 Frank did have a staff member present, who would like to read the             
 sponsor statement.  Thus, he would like to defer to him.  He said             
 he would be available to answer any questions of the committee.               
 Number 548                                                                    
 TOM WILLIAMS, Legislative Assistant, Senator Frank, reiterated SB
 92 was introduced by the Legislative Rules Committee at the                   
 unanimous request of LB&A.  He said this bill would bring all of              
 the activities of the Alaska Housing Finance Committee under the              
 review procedures of the Executive Budget Act.  Under this Act, an            
 agencys budget programs and services are established through both             
 the executive and legislative processes for the annual general                
 appropriation act.  He stated currently the AHFC statutes bring               
 four listed areas under this act: 1) Operating budget of the                  
 corporation, 2) the assets of the corporation used for grants or              
 grant programs, 3) interest rates, subsidies, and building                    
 subsidies as determined by the corporation, and 4) activities of              
 the corporation related to the former Alaska State Housing                    
 Authority program.  All other activities of the AHFC are exempt               
 from the Executive Budget Act.  He provided an example of the type            
 of programs of AHFC exempted from the Executive Budget Act as the             
 approximately 110 million in funds used for the recent 5 percent              
 housing loan program.  SB 92 would bring this operation under                 
 legislative review as part of the operating budget.  The LB&A                 
 feels this and all housing subsidy programs of the AHFC are                   
 significant state fiscal policy matters that should fall under the            
 review process of both the Legislative and Executive branches.                
 CHAIR JAMES asked if there were any questions from the committee              
 for Mr. Williams.  She decided to hear the testimony from those               
 people on teleconference.  She called for Michael Chevalier to                
 Number 570                                                                    
 MICHAEL CHEVALIER, Housing Director for Anchorage Neighborhood                
 Housing Services, wanted to inform the committee of his opposition            
 to SB 92.  He felt there was considerable demand in Alaska for                
 affordable housing.  He said that typically there are about eight             
 different sources of finance for a housing project and the                    
 developer is forced to try to bring all of those pieces together.             
 Thus, he thought the AHFC should be allowed to work within its                
 existing parameters.  He thought they had adequately met the needs            
 of the various affordable housing developers.  He stated his second           
 point, was he did not feel the AHFC was a runaway renegade                    
 organization.  He felt they understood the legislatures desire for            
 stability in its operations, but thought stability was the result             
 of continuity in leadership.  He argued an environment should be              
 created to enhance the corporations continuity and longevity of               
 board members and executive directors.                                        
 CYNTHIA PARKER, Executive Director of Anchorage Neighborhood                  
 Housing Services, stated her opposition to SB 92.  She wanted to              
 state for the record that Anchorage Neighborhood Housing Services             
 had been involved in the housing industry for the last 12 years and           
 had worked closely with the AHFC.  She mentioned she was formerly             
 the Chair of the Alaska Housing Market Council, which made a number           
 of recommendations to the legislature regarding Alaskan housing.              
 She said part of that recommendation was to bring the AHFC under              
 the Executive Budget Act to make it responsive to the legislature.            
 She thought one of the problems with SB 92, was that it did not get           
 to the specific problems the legislature was concerned about.  She            
 stated she had heard mention earlier, about the recent 5 percent              
 housing loan program, but felt this bill would not address this               
 issue.  She argued the AHFC needed to be flexible in its loan                 
 programs to be flexible in the marketplace.  She stated the funds             
 used in the 5 percent loan program were exempted under this bill,             
 as they are really U. S. federal funds.  She urged the legislature            
 to support the Governors plan to request the AHFC to come up with             
 a five year long range fiscal plan and also come up with some goals           
 and objectives they would like to offer to the state, but not to              
 require them to get approval from the legislature for each                    
 ROBIN HARRISON, Executive Director for the Tagiugmullu Nunamiullu             
 Housing Authority, said last year they participated in the AHFCs              
 loan and sponsor program and so were able to develop a mortgage               
 loan product tailored to meet the needs of their low income                   
 families in the most remote areas of the North Slope.  She argued             
 these families were out of reach of more conventional loan                    
 programs, due to their low income level and their remote location.            
 She pointed out several barriers to getting loans from other                  
 sources in these remote locations.  Thus, the AHFC was about their            
 only option for housing loans.  The  AHFCs programs allowed 7                 
 communities and 53 families to find homes on the North Slope 2 days           
 before Christmas.  These families had zero hope of moving into a              
 home or owning one without this program.  She felt certain that               
 should this bill have been in place last year, these families would           
 still be looking for homes.  They would have to wait for a decision           
 from the legislature and then another 18 months for the loan                  
 programs to be put in place and the construction to take place.               
 Since 1987, with an increase in how to use the AHFC loan program,             
 rural communities in northern Alaska has managed to increase the              
 loans granted to these communities from 2-5 loans per year to 15-20           
 loans per year.  She argued SB 92 would mean for the AHFC to                  
 respond in an increase of 30-45 percent demand for housing, they              
 would have to guess correctly at the activity level of their                  
 corporation that can change dramatically over 12 months.  Should              
 they guess wrong, a year is lost as they wait for the next                    
 legislative session.                                                          
 REPRESENTATIVE GREEN asked if Ms. Robinson had any idea of the                
 success ratio for repayment of loans from the rural areas as                  
 compared to that of the urban areas.                                          
 TAPE  95-39,  SIDE A                                                          
 Number 000                                                                    
 MS. ROBINSON claimed rural residents tend to not skip, because they           
 are rooted in their community.                                                
 BOB MAXWELL urged the committee proceed with caution and                      
 investigate carefully before passing SB 92, to see if this action             
 would negatively impact the bond rating of the corporation.  He               
 mentioned that AHFC has been able to provide $580 million to the              
 general fund since 1992.  Thus, he felt it was absolutely necessary           
 to maintain the fiscal integrity of the AHFC so they can continue             
 to generate income and contribute to the general fund.  He                    
 encouraged the legislature to develop a process, whereby all                  
 programs reviewed under the Executive Budget Act be allowed a                 
 public hearing.  Currently, those programs of AHFC under this Act             
 were not allowed public hearings, he said.  He felt it was                    
 difficult to do the publics business without public input.                    
 Number 059                                                                    
 CHAIR JAMES asked if there was anyone else on teleconference                  
 wishing to testify and noted the arrival of Representative                    
 Robinson.  Hearing none, she called for Dan Fauske, present in the            
 room, to testify.                                                             
 DAN FAUSKE, Corporate Executive Officer of AHFC, said the                     
 corporation was created in 1971 to provide Alaskans with low cost             
 mortgage financing.  In legislation enacted in June 1980, the                 
 legislature found the conventional sources of finance for                     
 residential dwellings were inadequate and mandated the AHFC provide           
 financing without regard to income limits and interest rate subsidy           
 program for home purchase.  In 1992, the legislature merged AHFC,             
 ASHA, and the Department of Community and Regional Affairs rural              
 loan and energy programs, in order to create a comprehensive                  
 housing agency for the state.  Through this legislation, AHFC was             
 expanded to include a group of programs beyond its traditional role           
 as a secondary market investor for home mortgages.  This decision             
 has benefitted thousands of Alaskans.  This approach of combining             
 all housing programs is considered innovative nationally and is               
 being copied by other states.  After reviewing SB 92, he                      
 interpreted that all activities of the AHFC would require budget              
 submission that would include the current capital and operating               
 budgets and expand to include all loan programs of the corporation.           
 He stated there were currently 23 loan programs that fall under 5             
 major categories.  He  felt this would mean certain negatives for             
 the program.  Loan programs have historically not been a part of              
 the AHFCs budget submission.  This is because the majority of                 
 their loan programs that provide housing to the citizens throughout           
 the state, are a result of legislative mandate and direction.  They           
 are funded through bond issues, both taxable and tax exempt.                  
 Allowing the AHFC to function without legislative oversight has               
 protected the corporations ability to enter the marketplace at                
 opportune times with respect to rising and falling interest rates.            
 This allows the corporation to partner with entities such as HUD,             
 to spearhead new programs, and protect the ability to expeditiously           
 respond to changing economic situations that affect the housing               
 market.  He did not feel anyone wanted to interfere with AHFCs                
 ability to enter the marketplace and develop housing programs.  He            
 felt this bill was a result of two specific situations, the 5                 
 percent loan program and the new office building.  The office                 
 building was a politically bad move by the corporation, he said.              
 The loan program was successful in targeting a niche of the states            
 citizens, that otherwise would be unable to attain home ownership.            
 He admitted, though, the mechanics of delivering the program were             
 flawed.  He asked that if the majority of their programs were                 
 meeting the intent of the legislature and the needs of the states             
 citizens, then why consider such broad oversight that could                   
 potentially impede the corporations ability to respond to market              
 conditions.  He wanted to assure the committee the corporation                
 would be very sensitive to the ripple effect of loan program                  
 development, analyze the positive and negatives of loan programs,             
 be confident they adhere to legislative mandates and makes economic           
 sense before implementation, and better target the intended                   
 constituency with each program.  He urged the committee to not                
 restrict the corporations ability to respond to the volatility of             
 the marketplace by forced legislative oversight.  He wanted to                
 comment he thought oversight was good and suggested forming a work            
 group to better educate everyone of the functions of the                      
 corporation.  Thus, he welcomed oversight and scrutiny from the               
 legislature, but did not want to see the corporation restricted for           
 seven months when the legislature was not in session.                         
 Number 187                                                                    
 REPRESENTATIVE PORTER asked Mr. Fauskes opinion of an oversight               
 similar to the one the legislature has over the Alaska Industrial             
 Development and Export Authority board.                                       
 MR. FAUSKE thought this idea could work, but the $10 million cap              
 was not high enough to be functional with the AHFC.  He pointed out           
 that in 1994, the AHFCs loan portfolio was $864 million.  Thus, he            
 thought the oversight was good, but again suggested a work group to           
 see how this oversight should be accomplished.  Capping the dollar            
 amount before requiring oversight is conceivable, but the dollar              
 amount would have to be high enough and have some guidelines of               
 activities to not prevent the corporation from taking advantage of            
 opportunities in the marketplace.                                             
 Number 225                                                                    
 REPRESENTATIVE OGAN expressed his opposition to SB 92.                        
 Participating in construction the past twenty years, he said he had           
 seen the stability the AHFC has brought to the market first hand.             
 He thought this bill was overkill to some specific complaints, that           
 could be resolved in a more rational manner.  He refused to have              
 his name on a bill that he felt could seriously hurt the                      
 construction industry.  He urged the committee and legislature to             
 consider holding this bill for investigation over the interim.                
 REPRESENTATIVE IVAN stated he could understand the concerns of                
 LB&A, but heard the testimony that said this corporation was a real           
 benefit to rural families.  He felt it might be better to allow the           
 corporation to continue as is and thought the bill was too                    
 restrictive without being amended.                                            
 CHAIR JAMES asked if it was possible for the committee to stay late           
 to allow a chance for all of those who came testify to participate.           
 Number 298                                                                    
 JAN SIEBERTS, Senior Vice President, National Bank of Alaska,                 
 expressed his concern over SB 92.  He said NBA was a partner with             
 with the AHFC in the development of housing projects in Alaska.  He           
 said the NBA was concerned SB 92 would create serious problems for            
 the AHFC and at a minimum should be modified.  In 1994, NBA                   
 participated with the AHFC in urban and remote loans throughout the           
 state and developed housing for low income and the homeless in                
 Anchorage and Juneau.  They also participated in senior citizen               
 housing in Fairbanks and Homer, as well as the housing project on             
 Eielson Air Force Base.  Because of the lengthy loan process for              
 housing construction, the AHFC is a necessary and useful tool.  He            
 felt if the corporation had to come for approval by the legislature           
 for every project, these projects could be delayed for up to a                
 year.  He thought costs would increase dramatically and                       
 opportunities would be missed.  He requested a modification to the            
 bill to allow AHFC to continue to function and meet the housing               
 needs of Alaska.                                                              
 Number 373                                                                    
 SUE BENEDETTI, President, Alaska Mortgage Bankers Association and             
 Vice President, First National Bank of Anchorage, expressed her               
 serious concerns about placing the AHFC under the Executive Budget            
 Act.  She said such an action would prevent the corporation from              
 responding to changing conditions in the economy.  This could mean            
 borrowers missing out on good mortgage rates and the corporations             
 missing out on programs that would meet the publics needs.  She               
 stated the mortgage industry changes at a rapid rate and markets              
 can be volatile.  Thus, the corporation needs to be able to respond           
 on a day to day basis to maximize its potential to meet Alaskas               
 housing needs.   The AHFC provides a stable source of funds for               
 mortgage in good times, but more importantly in bad times when                
 other investors pull out.  They have an excellent working                     
 relationship with banks, mortgage companies, and government                   
 agencies to maximize their ability to provide housing for Alaskans.           
 These relationships lead to new sources of funding and it is                  
 important the AHFC retain its ability to work on a year round                 
 basis.  She said the corporation could pay a sizeable dividend to             
 the state for years to come.  The Alaska Mortgage Bankers                     
 Association believes the focus should be on developing a workable             
 dividend program and not substantially changing the way the AHFC              
 operates and thereby jeopardizing its ability to meet the housing             
 needs of Alaska.                                                              
 JOHN EGAN, Volunteer President of Housing First, Inc., stated he              
 was a customer of the AHFCs products.  As a president of a small              
 community based nonprofit corporation, he thought the work they               
 were doing to meet the housing needs of Juneau would not be                   
 happening without the support of the AHFC.  Multi-family housing              
 projects in general would not be developed without the help of the            
 AHFC.  He claimed there was little private secondary mortgage                 
 investors for multi-family housing units.  He said Housing First              
 could not function without the support of Alaska Housing Finance              
 Corporation.  Because many of the AHFCs programs are tied to those            
 of the federal government, there is already a significant delay in            
 processing paperwork in getting a project approved.  He felt if SB
 92 passed, the AHFC would be cemented into a glacial pace of                  
 operation.  Banks and nonprofits will not be able to hold projects            
 for months, while waiting for legislative approval.  He said the              
 AHFC is now doing the kind of financing the state needs to                    
 stabilize the housing market in Alaska.  They are a genuine                   
 community resource, he said, and nonprofit corporations do not have           
 this resource anywhere else.  These community based groups are                
 unable to gather financing from several different investment                  
 sources without the support of the AHFC.  He pleaded with the                 
 committee to not halt an already slow process with passage of SB
 Number 442                                                                    
 TAMARA ROWCROFT, General Manager, Alaska Housing Development                  
 Corporation, said her group was formed over twenty years ago to               
 address the housing needs of Juneau.  They operate a 96 unit                  
 housing complex for low to moderate income families.  About three             
 years ago, they decided they needed to try to develop more                    
 affordable housing in Juneau.  After seeing what resources were               
 available, they finally got a financing package to Aid to Families            
 with Dependent Children after two years effort.  She said they were           
 prompt and granted financing to their project.  She said their                
 organization was interested in continuing to provide housing in               
 Juneau and were concerned this bill would make it more difficult              
 and time consuming to get projects started.                                   
 TOM WILLIAMS responded SB 92 was not intended to put a damper on              
 loan programs.  He said the intent was to have the legislature                
 involved in the loan process to allow them some oversight of that             
 process.  Testimony from the Senate Finance indicated there was an            
 interest in improving communications between the AHFC and the                 
 legislature.  They felt this bill would accommodate this effort.              
 He did not feel this bill would preclude the AHFC from                        
 participating in loan programs when the legislature was not in                
 session, as the appropriate body to deal with interim activities              
 was the Legislative Budget and Audit Committee.  That is why this             
 committee supported this bill.  Thus, they did not feel there would           
 be a significant impact on the corporation.  He felt any agency               
 would like to be free to do as they pleased and hoped the new                 
 administration of the AHFC would improve communication with the               
 legislature.  He felt this bill would help to insure this happened.           
 He thought good planning and proper budgeting could provide a                 
 reasonable amount of flexibility, especially with the support of              
 the LB&A.  He reiterated his feelings that this legislation was               
 necessary and provided a mechanism to insure things did not get out           
 of hand.                                                                      
 MR. FAUSKE wanted to point out the Executive Budget Act required              
 the LB&A to finish their review in 45 days.  He argued this was a             
 life time in the world of mortgage financing and could mean many              
 missed opportunities.  He reiterated he welcomed oversight, but was           
 concerned about the time line and missed opportunities.                       
 CHAIR JAMES said this bill would be rolled to next week for                   
 consideration by the committee.  She stated her intentions of                 
 passing out HB 269, before the committee adjourned.                           
 HB 269 - TAX CREDIT:  GIFTS TO PUBLIC BROADCASTING                           
 TOM WRIGHT, legislative assistant to bill sponsor,  Representative           
 Ivan, said he would wave his sponsor statement in the interest of             
 time and be available to answer questions from the committee.                 
 CHAIR JAMES asked if there was any questions or comments from the             
 Number 536                                                                    
 REPRESENTATIVE PORTER said he would move to pass HB 269 out of                
 committee with individual recommendations and attached fiscal                 
 CHAIR JAMES asked if there was any objections.  Hearing none, the             
 bill passed out of committee.  Chair James adjourned the meeting at           
 10:19 a.m.                                                                    

Document Name Date/Time Subjects