Legislature(2017 - 2018)SENATE FINANCE 532
04/13/2017 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB78 | |
| HB137 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| + | HB 137 | TELECONFERENCED | |
| += | SB 78 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
April 13, 2017
9:06 a.m.
9:06:51 AM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 9:06 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Anna MacKinnon, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Shelley Hughes
Senator Peter Micciche
Senator Donny Olson
Senator Natasha von Imhof
MEMBERS ABSENT
None
ALSO PRESENT
Juli Lucky, Staff, Senator Anna MacKinnon; Representative
Harriet Drummond, Sponsor; Kristen Kranendonk, Staff,
Representative Harriet Drummond; Benjamin Brown, Chair,
State Council on the Arts.
SUMMARY
SB 78 PERM FUND DIVIDEND CONTRIBUTIONS/LOTTERY
CSSB 78(FIN) was REPORTED out of committee with a
"do pass" recommendation and with and with a new
fiscal impact note by the Senate Finance
Committee for the Department of Revenue; one
previously published zero fiscal note: FN1 (LAW);
and one previously published fiscal impact note:
FN3 (REV).
HB 137 ST. COUNCIL ON THE ARTS: PUBLIC CORP.
SCS HB 137 was REPORTED out of committee with a
"do pass" recommendation and with two previously
published fiscal impact notes: FN2(EED) and
FN3(EED).
SENATE BILL NO. 78
"An Act creating the education endowment fund and the
dividend lottery fund; authorizing contributions from
the permanent fund dividend to the dividend lottery
fund; relating to transfers from the dividend lottery
fund and the education endowment fund; relating to the
definition of 'gambling'; and providing for an
effective date."
9:07:33 AM
Co-Chair MacKinnon relayed that the committee had heard
SB 78 twice and had opened and closed public testimony. At
the most recent hearing the committee had discussed
prioritization of voluntary contributions from an
individual's dividend check.
Vice-Chair Bishop MOVED to ADOPT Amendment 1, 30-LS0534\M.2
(Martin, 4/12/17) (copy on file):
Page 1, line 4, following "fund;":
Insert "relating to the duties of the Department
of Revenue;"
Page 2, following line 20:
Insert a new bill section to read:
"* Sec. 2. AS 43 .23 .055 is amended to read:
Sec. 43.23.055. Duties of the department. The
department shall
(1) annually pay permanent fund dividends
from the dividend fund;
(2) subject to AS 43.23.011 and [PARAGRAPH]
(8) of this section, adopt regulations under
AS 44.62 (Administrative Procedure Act) that
establish procedures and time limits for
claiming a permanent fund dividend; the
department shall determine the number of
eligible applicants by October 1 of the year
for which the dividend is declared and pay
the dividends by December 31 of that year;
(3) adopt regulations under AS 44.62
(Administrative Procedure Act) that
establish procedures and time limits for an
individual upon emancipation or upon
reaching majority to apply for permanent
fund dividends not received during minority
because the parent, guardian, or other
authorized representative did not apply on
behalf of the individual;
(4) assist residents of the state,
particularly in rural areas, who because of
language, disability, or inaccessibility to
public transportation 1need assistance to
establish eligibility and to apply for
permanent fund dividends;
(5) use a list of individuals ineligible for
a dividend under AS 43.23.005(d) provided
annually by the Department of Corrections
and the Department of Public Safety to
determine the number and identity of those
individuals;
(6) adopt regulations that are necessary to
implement AS 43.23.005(d);
(7) adopt regulations that establish
procedures for the parent, guardian, or
other authorized representative of a
disabled individual to apply for prior year
permanent fund dividends not received by the
disabled individual because no application
was submitted on behalf of the individual;
(8) adopt regulations that establish
procedures for an individual to apply to
have a dividend disbursement under AS
37.25.050(a)(2) reissued if it is not
collected within two years after the date of
its issuance; however, the department may
not establish a time limit within which an
application to have a disbursement reissued
must be filed;
(9) provide any information, upon request,
contained in permanent fund dividend records
to the child support services agency created
in AS 25.27.0 10, or the child support
enforcement agency of another state, for
child support purposes authorized under law;
if the information is contained in an
electronic data base, the department shall
provide the requesting agency with either
(A) access to the data base; or
(B) a copy of the information in the
data base and a statement certifying
its contents;
(10) establish a fraud investigation unit
for the purpose of assisting the
(A) Department of Law in the
prosecution of individuals who apply
for or obtain a permanent fund dividend
in violation of a provision in AS 11,
by detecting and investigating those
crimes; and
(B) commissioner to detect and
investigate the claiming or paying of
permanent fund dividends that should
not have been claimed by or paid to an
individual and to impose the penalties
and enforcement provisions under AS
43.13.035
(11) adopt regulations under AS 44.62
(Administrative Procedure Act) so that
contributions under AS 43.23.062 are given a
priority over donations under AS 43.23.064
if the total amount of contributions and
donations elected by an applicant exceeds
the amount of the permanent fund dividend
that the applicant is entitled to receive.
Renumber the following bill sections accordingly."
Co-Chair MacKinnon OBJECTED for discussion.
9:08:18 AM
JULI LUCKY, STAFF, SENATOR ANNA MACKINNON, discussed
Amendment 1 (copy on file). She stated that the amendment
had been drafted at the request of the sponsor. She relayed
that while the amendment was lengthy, it only effectively
did one thing. She referred to page 2, line 29, which
indicated that the amendment would prioritize the existing
Pick Click Give program under AS 43.23.062 over the new
raffle program proposed in the bill and enacted under AS
43.23.064. She explained that if a person had promised more
of their dividend in voluntary reductions than they would
receive, then the Pick Click Give program donations would
be paid first, and the raffle tickets would be prioritized
second.
Co-Chair MacKinnon recalled that under voluntary
contributions, the University of Alaska Scholars Program
was the first item prompted. The second prompt for
voluntary contributions was Pick Click Give. The third
prompt would ask if the applicant wanted to support public
education by participating in a raffle with a chance to
win.
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
further OBJECTION, Amendment 1 was ADOPTED.
Co-Chair MacKinnon announced there was an amended committee
substitute before the committee. She invited comments on
the bill. She read the title of the bill and invited
Senator Bishop to leave the committee with some final
comments on the bill.
Vice-Chair Bishop spoke to the bill as the sponsor. He
thought people in the state prioritized education, which he
had observed through emails, phone calls, and text messages
during the budget process. He thought the bill was another
tool by which state residents could voluntarily contribute
towards education. He believed the concept would be popular
with Alaskans. He thanked the body for hearing the bill.
Senator Hughes thanked the sponsor for bringing the bill
forward and for his responsiveness to the comments made in
the the Senate Education Committee pertaining to the use of
the word "raffle" rather than the word "lottery." She
thought clarification was needed because the word "raffle"
involved a defined group of people and a defined limited
amount of time. She thought it was no different from going
to a local chamber meeting and participating in a bucket
raffle. It would be for a limited group of people for a
limited time. She thought it was important to distinguish
"raffle" from "lottery". She was thankful that the bill
sponsor was willing to make a language adjustment.
Vice-Chair Bishop appreciated his colleague's suggestion
about having a ranking order of voluntary contributions. He
reiterated the order of options. He looked forward to
seeing how the bill functioned.
Co-Chair MacKinnon directed attention to fiscal note 2,
dated March 31, 2017. The fiscal note reflected a cost for
software upkeep.
9:13:31 AM
AT EASE
9:14:44 AM
RECONVENED
Co-Chair MacKinnon asked for committee support to amend
fiscal note 2 from the Department of Revenue, OMB
component 121. She wanted to amend the funding source to
1005 Program Receipts. She explained there was a percentage
charge for the administration of the program. The funding
source would no longer be undesignated general funds. She
asked if she had member support to change the funding
source to 1005 Program Receipts. There was no objection.
The amendment to fiscal note 2 was ADOPTED.
Co-Chair MacKinnon continued to discuss fiscal note 2. The
projection for services was $4,400 in FY 19, $8,800 in
FY 20, $13,100 in FY 21, $17,500 FY 22, and $21,900 in
FY 23. Whether the costs would be realized depended on the
activity of the people of Alaska.
Vice-Chair Bishop MOVED to report CSSB 78(FIN) out of
Committee with individual recommendations and the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
CSSB 78(FIN) was REPORTED out of committee with a "do pass"
recommendation and with and with a new fiscal impact note
by the Senate Finance Committee for the Department of
Revenue; one previously published zero fiscal note: FN1
(LAW); and one previously published fiscal impact note: FN3
(REV).
9:16:36 AM
AT EASE
9:18:52 AM
RECONVENED
HOUSE BILL NO. 137
"An Act redesignating the Alaska State Council on the
Arts as a public corporation and governmental
instrumentality of the state; defining the powers and
duties of the Alaska State Council on the Arts;
providing exemptions from certain statutes for the
Alaska State Council on the Arts; making conforming
amendments; and providing for an effective date."
9:18:59 AM
Co-Chair MacKinnon read the bill title for HB 137 (see
above). She recalled that the committee heard the companion
bill, SB 66, on March 24, 2018. She invited the bill
sponsor to the table.
REPRESENTATIVE HARRIET DRUMMOND, SPONSOR, informed that HB
137 was sponsored by the House Education Committee. The
committee had unanimously consented to sponsoring the
legislation as a committee bill. It passed the House
unanimously. She read a portion of the sponsor statement:
House Bill 137 quasi-privatizes the Alaska State
Council on the Arts (ASCA) by restructuring it as a
public corporation in order to help the ASCA to
continue its work with self-employed Alaskan artists
and art businesses during these challenging fiscal
times. This new status will allow the ASCA to increase
its ability to leverage funds from non-governmental
contributors and better adapt to the shifting economic
climate.
Representative Drummond understood that the Senate Finance
Committee had already heard the Senate version of the bill
and would not go into detail about the bill unless the
chair directed her to.
Senator von Imhof asked if there was a difference in the
two bills.
KRISTEN KRANENDONK, STAFF, REPRESENTATIVE HARRIET DRUMMOND,
stated that the version before the committee was the same
as the Senate version. However, she thought the committee
had an amendment to offer.
Senator Olson noted Representative Drummond's mention of
quasi-privatization. He asked if she had looked at any
other places to receive funds aside from the private sector
allowed by the bill.
Representative Drummond deferred to the Chairman of the
State Council on the Arts.
9:22:00 AM
BENJAMIN BROWN, CHAIR, STATE COUNCIL ON THE ARTS, stated
that there were earned income opportunities and program
receipts such as the license plate program that passed in
the prior year. There would be a two-round competitive
process to select a license plate to celebrate the arts. He
opined the project would generate funds. He had also talked
with other legislators, including Senator Hughes, about
other ways of looking for earned income. He noted the
possibility of using the temporary art bank to provide art
to non-governmental offices for compensation. In addition
to asking for foundation funds, the council saw earned
income as a possibility going forward.
Senator Olson asked if Mr. Brown could discuss whether the
loan program was something the council planned on
participating in.
Mr. Brown did not know of any other state that had a public
art bank that used it as a service to the private sector.
However, it was certainly something the council was willing
to look at. He thought the problem was that the private
sector was not seeking to expend funds on decorating its
buildings in the current economic climate. He suggested
that it was possible in the future. He was hoping to use
the resources from the National Assembly of State Arts
Agency to see if there was an example from another state
Alaska could replicate.
Senator Olson asked about the program receipts and asked if
the council was competing with any other entities for the
program receipts.
Mr. Brown indicated that his late father had been
instrumental in founding the Children's Trust. He and his
spouse had Children's Trust license plates on both of their
cars. He would have to get art plates once they were
available, which he jokingly said would be a conflict. He
relayed that private galleries did not rent art, rather,
they sold it. He did not see any possible unfair
competition.
Senator Olson suggested Mr. Brown get a second car.
Mr. Brown replied, "Maybe a third car."
Co-Chair MacKinnon reminded members and testifiers to relay
their remarks through the chair. She asked Representative
Drummond if she had a statement on whether the trustees
should be confirmed. Alaska had several corporations with
trustees confirmed by the legislature in state statute. She
used the examples of Alaska Gasline Development Corporation
(AGDC) and the Alaska Housing Finance Corporation (AHFC).
Additionally, Alaska had some corporations whose trustees
were not confirmed such as the Alaska Permanent Fund
Corporation.
Representative Drummond did not have an opinion on the
matter. She thought there were 11 members on the council
each having an area of expertise defined in the bill. The
idea was for the council to best serve the needs of the
organization. Skills in the area of art were unique to that
business.
Co-Chair MacKinnon asked if Mr. Brown had an opinion on
whether the council members should be confirmed.
Mr. Brown relayed that the council had researched examples
from other states and jurisdictions. Some council members
were appointed by legislative bodies. In other states the
governor appointed members who were confirmed by the
legislature. The council concluded that the number of
council members and the way in which they were appointed
worked well for Alaska and did not need to be changed. He
thanked Co-Chair MacKinnon for the example of the Permanent
Fund Board of Trustees.
Co-Chair MacKinnon asked the committee if it was of like
mind that there did not need to be a confirmation at the
legislative level for the new corporation.
9:27:06 AM
Co-Chair MacKinnon relayed that public testimony had been
heard previously.
Co-Chair MacKinnon MOVED to ADOPT Amendment 1 ((copy on
file):
Page 10, lines 16-17
Delete "an Alaska veterans' preference that is
consistent with the Alaska veterans' preference
in AS 36.30.321(f)"
Insert "the preferences of an Alaska bidder and
an Alaska veteran that are consistent with the
preferences in AS 36.30.32 1"
Vice-Chair Bishop OJBJETED for discussion.
Co-Chair MacKinnon explained that there was a preference in
the previous version of the bill. The amendment would add
the Alaska bidder preference. She thought if there was
going to be a preference the others should be included.
9:27:47 AM
AT EASE
9:31:09 AM
RECONVENED
Co-Chair MacKinnon confirmed that the Alaska bidder
preference was combined with the Alaska Veteran's
preference consistent with AS 36.30.321. She wanted both
preferences listed to ensure that local artists could
compete with national and international artists. She would
provide the definition of "Alaska bidder preference" before
the bill went to the Senate floor for a vote.
Vice-Chair Bishop WITHDREW his OJBECTION. There being NO
further OBJECTION, Amendment 1 was ADOPTED.
Vice-Chair Bishop discussed the fiscal note. The fiscal
note by the Department of Education and Early Development
with an appropriation of commissions and boards and an
allocation of the Alaska State Council on the Arts had an
OMB component number of 192. It was essentially a zero
fiscal note. The fiscal note removed all state funding
within the state council. The funding was being transferred
to the new state council appropriation. The second fiscal
note, currently without an OMB component number, had an
appropriation and allocation of Alaska State Council on the
Arts. The annual cost was $2,768.5 million. The analysis
indicated that the positive impact of cost reductions could
not be determined until the agency restructured.
Efficiencies that were anticipated in operating costs could
not be quantified at present.
Co-Chair MacKinnon commented that the council received
funds and leveraged other funds from out of state from the
National Arts Endowment.
9:34:10 AM
AT EASE
9:34:22 AM
RECONVENED
Co-Chair MacKinnon conveyed the definition of an Alaska
bidder in at AS 36.30.990:
(2) "Alaska bidder" means a person who
(A) holds a current Alaska business license;
(B) submits a bid or proposal for goods, services,
or construction under the name appearing on the
person's current Alaska business license;
(C) has maintained a place of business in the state
staffed by the bidder or offeror or an employee of the
bidder or offeror for a period of six months
immediately preceding the date of the bid or proposal;
(D) is incorporated or qualified to do business
under the laws of the state, is a sole proprietorship
and the proprietor is a resident of the state, is a
limited liability company organized under AS 10.50 and
all members are residents of the state, or is a
partnership under former AS 32.05, AS 32.06, or AS
32.11 and all partners are residents of the state; and
(E) if a joint venture, is composed entirely of
ventures that qualify under (A) (D) of this
paragraph.
Senator Olson asked Co-Chair MacKinnon to repeat the
statute reference. Co-Chair MacKinnon repeated the statute
reference.
Vice-Chair Bishop MOVED to report SCS HB 137(FIN) out of
Committee with individual recommendations and the
accompanying fiscal notes.
There being NO OBJECTION, it was so ordered.
SCS HB 137 was REPORTED out of committee with a "do pass"
recommendation and with two previously published fiscal
impact notes: FN2 (EED) and FN3 (EED).
9:36:13 AM
AT EASE
9:38:11 AM
RECONVENED
Co-Chair MacKinnon discussed the schedule for the afternoon
meeting.
ADJOURNMENT
9:38:35 AM
The meeting was adjourned at 9:38 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 78 Amendment 1 Bishop.pdf |
SFIN 4/13/2017 9:00:00 AM |
SB 78 |
| HB 137 Amendment 1 MacKinnon.pdf |
SFIN 4/13/2017 9:00:00 AM |
HB 137 |