Legislature(2017 - 2018)SENATE FINANCE 532
04/10/2017 09:00 AM Senate FINANCE
Note: the audio ![]()
and video ![]()
recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.
| Audio | Topic |
|---|---|
| Start | |
| SB107 | |
| SB88 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 107 | TELECONFERENCED | |
| + | SB 88 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
April 10, 2017
9:01 a.m.
9:01:39 AM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 9:01 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Anna MacKinnon, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Mike Dunleavy
Senator Peter Micciche
Senator Donny Olson
Senator Natasha von Imhof
MEMBERS ABSENT
None
ALSO PRESENT
Laura Cramer, Staff, Senator Anna MacKinnon; Representative
Sam Kito; Senator Bert Stedman, Sponsor; Wyn Meneffe,
Deputy Director, Land Office, Alaska Mental Health Trust
Authority.
PRESENT VIA TELECONFERENCE
Jon Bolling, City Administrator, City of Craig, Craig;
David Landis, Mayor of Ketchikan, Ketchikan; Owen Graham,
Executive Director, Alaska Forest Association, Ketchikan.
SUMMARY
SB 88 AK MENTAL HEALTH TRUST LAND EXCHANGE
SB 88 was HEARD and HELD in committee for further
consideration.
SB 108 MEDICAL LICENSING/STATE MEDICAL BOARD
SB 108 was HEARD and HELD in committee for
further consideration.
SENATE BILL NO. 107
"An Act relating to the Alaska capital income fund."
9:02:47 AM
LAURA CRAMER, STAFF, SENATOR ANNA MACKINNON, stated that
the legislation changed the purpose of the Alaska capital
income fund. The legislation would change the fund to a
deferred maintenance fund.
Senator Dunleavy surmised that the legislation would create
a designated fund. Ms. Cramer replied that the funds would
not be required to be spent on deferred maintenance.
Senator Dunleavy understood that future legislatures could
determine how the funds were spent. Ms. Cramer agreed.
Co-Chair MacKinnon noted that the legislation was a Senate
Finance Committee bill. She stated that there was never a
designated a funding stream in the past. She stated that
the bill only had six lines and one section.
Senator von Imhof queried the process for determining which
projects received funding. She remarked that the Alaska
Capital Income Fund was created in 2006, and received an
annual deposit of earnings. She queried the amount of the
annual deposit, and the process for determining how those
funds were spent. Ms. Cramer replied that the annual
deposit was between $23 million and $26 million. She stated
that the total amount in the fund was $423 million. She
explained that deferred maintenance requests came from the
department agencies through Office of Management and Budget
(OMB), and were submitted in the governor's annual proposed
budget.
Senator Micciche queried the typical "spinoff" in revenue
from the fund. Co-Chair MacKinnon replied that it was
between $23 million to $26 million, depending on investment
returns.
9:07:04 AM
Vice-Chair Bishop stated that the fund was generated by the
Amerada Hess Settlement funds. Ms. Cramer agreed.
Vice-Chair Bishop stated that the interest generated in the
overview was from the Amerada Hess Settlement. Ms. Cramer
replied in the affirmative and explained that that the fund
was $422 million, and generated approximately $23 million
to $26 million annually.
Vice-Chair Bishop remarked that it was a simple concept. He
felt that the legislation was a way to save money.
Senator Dunleavy wondered whether the income stream would
replace any deferred maintenance money, or was it
supplemental. Ms. Cramer replied that she felt the fund
would add to the available funds.
9:10:09 AM
Senator Dunleavy felt that there should be a schedule about
how and when buildings were abandoned. He wanted a plan
with the legislation to determine how the fund was
utilized, because of the high number of deferred
maintenance fees.
Co-Chair MacKinnon stated that the bill did not add funds,
because the funds already exists. She stated that the funds
were already available. She explained that the outside
credit agencies would see that there was an investment in
deferred maintenance. She stressed that future legislatures
would be able to use the funds as they saw fit. She
remarked that every agency had their own system of
prioritization and selling their properties. Ms. Cramer
furthered that the legislation would provide a consistent
funding stream that was not currently available. She
remarked that OMB was working through a process with the
agencies to better prioritize deferred maintenance needs.
Senator Micciche felt that the fund did not provide more
money, but rather was the "first money" for deferred
maintenance.
9:15:00 AM
Senator von Imhof stated that the initial purpose of the
fund was for "any public purpose", and the purpose was
changed to "deferred and preventative maintenance." She
remarked that it was "okay" to create a guaranteed revenue
stream to incentivize deferred maintenance.
Senator Olson wondered whether there would be a change in
the prioritization of major maintenance. Ms. Cramer replied
that the legislation did not change the process that
deferred maintenance projects were submitted; it simply
provided a funding source.
Senator Olson remarked that there was an attempt to move
deferred maintenance to the capital budget. He wondered
whether there were other assets besides buildings or assets
that would be considered for maintenance that were not on
the list. Ms. Cramer replied in the negative.
Ms. Cramer addressed the zero fiscal note.
Co-Chair MacKinnon CLOSED public testimony.
Co-Chair MacKinnon stated that amendments were due by 5pm
the following day.
SB 107 was HEARD and HELD in committee for further
consideration.
9:19:40 AM
AT EASE
9:21:50 AM
RECONVENED
SENATE BILL NO. 88
"An Act authorizing a land exchange with the federal
government in which certain Alaska mental health trust
land is exchanged for certain national forest land and
relating to the costs of the exchange; and providing
for an effective date."
9:22:13 AM
SENATOR BERT STEDMAN, SPONSOR, introduced the bill.
Senator Stedman discussed the Sectional Analysis (copy on
file):
Section 1. Describes the purpose of the legislation:
1. Authorize the Department of Natural Resources,
who is acting on behalf of the Alaska Mental
Health Trust Authority, to exchange mental health
trust land with land of equal value from the
United States Forest Service;
2. Assist the Alaska Mental Health Trust
Authority in achieving its goals, one of which is
to increase trust revenue;
3. Contribute to the economic health of Southeast
Alaskan communities; and,
4. Preserve land adjacent to communities of
Ketchikan, Petersburg, Wrangell, Sitka, Juneau,
and Meyers Chuck
Section 2. Details the process of the exchange in
which parties are subject to the provisions of the
Alaska Mental Health Trust Land Exchange Act of 2017
instead of AS 38.05.801, AS 38.50, or any other law;
details the roles necessary for each party and the
costs assumed by each party.
Section 3. Details the affected lands of approximately
18,258 acres of mental health trust land and
approximately 20,580 acres of United States Forest
Service land, as well as defines the maps used.
Section 4. Provides a timeline for the exchange and
prioritizes the order in which lands described in
Section 3 will be exchanged.
Section 5. Provides a process in which the Department
of Natural Resources and the United States Secretary
of Agriculture will equalize the exchange if there are
differences in total value after the final appraisal.
Section 6. Provides the circumstances and actions that
need to occur to allow this Act to be made effective.
Section 7. Provides an effective date.
9:31:49 AM
Co-Chair Hoffman queried reconciliation of the acres
described in the testimony versus the written acreage in
Section 3.
9:32:10 AM
AT EASE
9:33:04 AM
RECONVENED
9:33:15 AM
Senator Stedman remarked that the numbers in the sectional
analysis were slightly inaccurate, because there was an
exclusion on the federal level of an island that was not
included in the exchange. He stated that the language in
the bill was correct.
Co-Chair MacKinnon looked at page 3 of the bill, the acres
that may be exchanged for federal land was 18,258.
Vice-Chair Bishop queried the diameter of the 200-year old
second growth trees. Senator Stedman replied with a
gesture. He announced that it was a valuable standing
second growth.
Vice-Chair Bishop remarked that the "cut line" may not even
be noticeable. Senator Stedman agreed.
Senator Micciche wondered if there was a compromise for
community growth by trading the land to the federal
government. Senator Stedman replied that the vast majority
of the land in the exchange was subject to the platting
authority of the boroughs. The communities were concerned
about their ability to expand for future generations. He
stated that the communities supported the land exchange.
9:39:18 AM
Senator Olson queried the number of corporations and native
allotments were affected by the legislation. Senator
Stedman replied that he was not aware of any impact on the
allotments or lack of support from the regional
corporations. He felt that the Alaska Mental Health Trust
Authority (AMHTA) may provide further information.
Co-Chair MacKinnon looked at page 3, line 7, and queried a
definition of "KARSTA Areas." Senator Stedman replied that
definition protected the below ground fish streams.
Co-Chair MacKinnon noted that the total acreage did not add
up accurately. She also looked at page 6, line 13, and
read, "subject to Section 5 of this act, if the United
States Secretary of Agriculture has conveyed the parcels of
federal land described in Section 13(b) to the Alaska
Mental Health Trust Authority, the Department of Natural
Resources shall convey the parcels of trust land described
in Section 3." She remarked that the totals did not add up
to the shifted acreage. She noted that the current AMHTA
land to be traded was 15,674 acres, but noted that Section
13(b) totaled 18,180 acres. She queried the reason for the
difference. She wondered why the acreage was not covered.
Senator Stedman deferred to AMHTA.
Co-Chair MacKinnon remarked that there was a difference in
the land sizes. Senator Stedman replied that it was
important to recheck the land sizes.
9:46:06 AM
WYN MENEFFE, DEPUTY DIRECTOR, LAND OFFICE, ALASKA MENTAL
HEALTH TRUST AUTHORITY, discussed the presentation, "The
Alaska Mental Health Trust" (copy on file).
Mr. Meneffe looked at slide 1:
•A perpetual trust using its resources to ensure a
comprehensive integrated mental health program in
Alaska.
•Funding programs that serve Alaska's most vulnerable
populations for the past two decades.
•Providing programs for mental illnesses,
developmental disabilities, Alzheimer's disease and
related dementias, traumatic brain injuries and
substance abuse disorders.
Mr. Meneffe highlighted slide 2, "The Trust Land Office":
Manages the Trust owned land and resources to generate
revenue, used by the Trust to improve the lives of the
beneficiaries.
Our Mission: to protect and enhance the value of
Alaska Mental Health Trust lands.
Mr. Meneffe addressed slide 3, "Trust Management
Principles":
1. Maximize long-term revenue and productivity from
trust land
2. Protect corpus
3. Encourage diverse revenue-producing uses of trust
land
4. Manage trust land prudently, efficiently and with
accountability to the trust and its beneficiaries
Mr. Meneffe discussed slide 4, "Land Distribution." He
remarked that the trust was not disposing all its assets.
He stressed that there was still land available for
development.
9:50:24 AM
Mr. Meneffe looked at slide 5, "Land Exchange Details":
17,341 acres of Trust lands adjacent to the
communities of Ketchikan, Wrangell, Petersburg, Sitka
and Juneau would be transferred to the USFS
20,580 acres of remote land on Prince of Wales Island
and Shelter Cove would be transferred to the Trust for
development and timber harvest
Equal value exchange
Phase I complete in 1 year and Phase II in 2 years
Mr. Meneffe displayed slide 6, "Trust Land To Be Exchanged
in Southeast Alaska; National Service Land to be
Exchanged." He outlined the details of the map. The areas
were removed from the communities, and eliminated some
concerns about logging the lands.
Mr. Meneffe highlighted slide 7, "Land Exchange Benefits":
Consolidates Trust land ownership
Replaces lands adjacent to communities with lands that
are more conducive to revenue production such as from
timber harvest
Protects timber and tourism industries
Protects jobs and economies in SE Alaska
Protects viewsheds, watersheds, and certain old growth
timber stands
9:55:15 AM
Mr. Meneffe addressed slide 8, "Why Now?":
Result of 10 years of planning and public input
Extensive negotiations with USFS
Addressing concerns from conservation groups and other
interests
USFS timber supplies have dwindled
Timber industry, a key revenue generator for the
Trust, is at risk because of low timber supply
Vice-Chair Bishop looked at slide 7, and remarked that it
was important to maintain a workforce. He stressed that the
timber industry was a year-round industry.
Co-Chair Hoffman queried the status of all the native land
selections in Southeast Alaska. Mr. Meneffe replied that
the bill did not affect the native corporation lands.
Co-Chair Hoffman wondered whether there were still
negotiations. Mr. Meneffe responded there were some native
allotments that were unresolved, but there were no native
allotments in the exchange.
Mr. Meneffe discussed slide 9, "USFS Forest Plan." He
stated that the map was a representation of the U.S. Forest
Service Dilemma. He remarked that there were many
designations that prevented timber harvest.
Mr. Meneffe addressed slide 10, "Federal Legislation":
•S. 131 introduced by Senator Murkowski and Sullivan
in January 2017
•HR. 513 introduced by Representative Young in January
2017
•Language compatible with SB 88 and HB 155
•Directs the USFS to complete the exchange
10:00:55 AM
Mr. Meneffe remarked that there were many supporters of the
bill. He stressed that the exchange was a positive revenue
generating exchange. The provision was timely, because the
timber industry needed the timber immediately.
Co-Chair Hoffman queried the positive impact of the
exchange from the U.S. Forest Service viewpoint. Mr.
Meneffe replied that the U.S. Forest Service saw the
legislation as "buffering their landholdings." He stated
that they did not like to be adjacent to private lands,
because of trespassing issues. He remarked that the U.S.
Forest Service wanted land that provided recreational
opportunities. He stated that the U.S. Forest Service had
become a recreation management organization, more than a
timber agency.
Co-Chair MacKinnon OPENED public testimony.
10:03:35 AM
JON BOLLING, CITY ADMINISTRATOR, CITY OF CRAIG, CRAIG (via
teleconference), spoke in support of the bill.
10:07:02 AM
DAVID LANDIS, MAYOR OF KETCHIKAN, KETCHIKAN (via
teleconference), testified in support of the legislation.
10:09:27 AM
OWEN GRAHAM, EXECUTIVE DIRECTOR, ALASKA FOREST ASSOCIATION,
KETCHIKAN (via teleconference), spoke in support of the
legislation.
Co-Chair MacKinnon CLOSED public testimony.
10:12:03 AM
Vice-Chair Bishop discussed the fiscal note.
Co-Chair MacKinnon announced that amendments were due the
following day by 5pm. She discussed the afternoon meeting
agenda.
SB 88 was HEARD and HELD in committee for further
consideration.
Senator Dunleavy shared that there was a concern about a
line item in the budget that there be a mandate to close
two pioneer homes. He wanted clarification on that issue.
10:14:48 AM
AT EASE
10:15:53 AM
RECONVENED
In response to a question from Senator Dunleavy, Co-Chair
MacKinnon stated that the budget identified the largest
areas where UGF were utilized in departments. She shared
that the Pioneer Home had large UGF spending. She remarked
that there were also two sections that allowed
administrations to move those allocations for cuts. She
stated that it was up to the administration to send notice,
but that there was continual discussion on the budget.
Senator Dunleavy surmised that the budget had reductions,
but did not specifically target the pioneer homes. Co-Chair
MacKinnon replied that she did not draft the operating
budget. She shared that she had been told that, "if the
department chooses to take the entire the reduction from
the Pioneer Home, that was the choice of the department."
ADJOURNMENT
10:18:51 AM
The meeting was adjourned at 10:18 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 107 Sponsor Statement version A 04.05.2017.pdf |
SFIN 4/10/2017 9:00:00 AM |
SB 107 |