Legislature(1997 - 1998)
04/17/1997 01:34 PM Senate L&C
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SENATE LABOR AND COMMERCE COMMITTEE
April 17, 1997
1:34 P.M.
MEMBERS PRESENT
Senator Loren Leman, Chairman
Senator Mike Miller
Senator Tim Kelly
Senator Lyman Hoffman
MEMBERS ABSENT
Senator Jerry Mackie
COMMITTEE CALENDAR
SENATE BILL NO. 159
"An Act relating to the new business incentive program."
-HEARD AND HELD
SENATE BILL NO. 169
"An Act relating to an exemption from the requirement for payment
for overtime under a voluntary work hour plan for work performed by
employees at certain mines; and providing for an effective date."
-MOVED SB 169 OUT OF COMMITTEE
CS FOR HOUSE BILL NO. 117(L&C)
"An Act relating to boiler and pressure vessel inspection
standards; relating to elevator safety and inspection standards;
and providing for an effective date."
-HEARD AND HELD
HOUSE BILL NO. 118 am
"An Act relating to reporting and other requirements of certain
employment accidents; and providing for an effective date."
-HEARD AND HELD
SENATE JOINT RESOLUTION NO. 27
Endorsing the Working Families Flexibility Act and the Family
Friendly Workplace Act.
-SCHEDULED, BUT NOT HEARD
PREVIOUS SENATE COMMITTEE ACTION
SB 159 - No previous action to consider.
SB 169 - See Labor and Commerce minutes dated 4/15/97.
HB 117 - No previous action to consider.
HB 118 - No previous action to consider.
SJR 27 - No previous action to consider.
WITNESS REGISTER
Mr. Jordan Koko, Intern
Senator Drue Pearce
State Capitol Bldg.
Juneau AK 99801-1182
POSITION STATEMENT: Staff to sponsor of SB 159.
Ms. Patty DeMarco, President
Anchorage Economic Development Corporation (AEDC)
550 W 7th Ave. #1400
Anchorage AK 99501
POSITION STATEMENT: Supported SB 159.
Mr. Mike Brady, Chairman
Anchorage Economic Development Corporation (AEDC)
550 W 7th Ave. #1400
Anchorage AK 99501
POSITION STATEMENT: Supported SB 159.
Mr. Scott Thompson, CEO
Alaska Power Systems
8300 King St.
Anchorage AK 99518
POSITION STATEMENT: Supported SB 159.
Ms. Donna Tollman
CVEDC
P.O. Box 9
Glennallen AK 99588
POSITION STATEMENT: Supported SB 159.
Ms. Katelyn Obner-Markley
Alaska Industrial Development and Export Authority
480 W. Tudor
Anchorage AK 99503
POSITION STATEMENT: Supported SB 159.
Mr. Greg Wolf
Anchorage Economic Development Corporation (AEDC)
550 W. 7th Ave., #1400
Anchorage AK 99518
POSITION STATEMENT: Supported SB 159.
Mr. Tom Lawson
Division of Trade and Development
Department of Commerce and Economic Development
P.O. Box 110804
Juneau AK 99811-0804
POSITION STATEMENT: Supported SB 159.
Mr. Dwight Perkins, Special Assistant
Department of Labor
P.O. Box 21149
Juneau AK 99802-1149
POSITION STATEMENT: Supported HB 117 and HB 118.
ACTION NARRATIVE
TAPE 97-20, SIDE A
Number 001
SB 159 NEW BUSINESS INCENTIVE PROGRAM
CHAIRMAN LEMAN called the Senate Labor and Commerce Committee
meeting to order at 1:39 p.m. and announced SB 159 to be up for
consideration.
MR. JORDAN KOKO, Intern to Senator Pearce, sponsor, said she
introduced this as a program that would encourage economic
development in the State of Alaska, especially in industries that
are unrepresented. This program would be used under the Alaska
Industrial Development and Export Authority and will be used to
allocate funds every year to help develop certain programs in the
State. There is a need to generate cargo and cargo capabilities,
including capitalizing on Alaska's locational advantages in
transferring cargo and encouraging that sort of development. This
would hopefully diversify Alaska's corporate tax base and encourage
more manufacturing in the State through other sorts of development
than oil. This would also encourage high value jobs that encourage
full time employment in the State.
MS. PATTY DEMARCO, President, Anchorage Economic Development
Corporation, said she does accept the amendment offered by CHAIRMAN
LEMAN. The dollar amount up to or not to exceed $3 million would
be no deterrent to the bill. This legislation is a way to
establish net new jobs in Alaska for manufacturing and other value
added kinds of activities. It doesn't require any expansion of
existing government staff and will be a divided responsibility
among the private sector proponent and the municipality that will
be host to the business, and hopefully the State of Alaska as well.
She said this is a bill that is a catalyst for action and it's a
way to give us a broader base for future growth of our economy.
There are a number of safeguards drafted into this legislation.
MS. DEMARCO said that there are 32 programs in other states that
compete with us for the same businesses. Statements from Federal
Express and Alyeska Alloys give the committee an idea of the
implications this program would have on the future growth of these
companies.
SENATOR HOFFMAN asked how she thought this would help rural areas
of the State. MS. DEMARCO replied that they are hopeful that by
having a way for broad areas of the State to attract a business in
the form of making land available and helping to support
infrastructure development.
MR. MIKE BRADY said this program allows infrastructure to be
created which is not necessarily economically viable without it.
He explained that Alaska, when viewed in the context of being the
cheapest place possible in which to establish a business, comes out
less favorable than a lot of other areas. This program would allow
the State to make up that difference for a period of time in order
to allow a business decision to be made that would be favorable to
the business position. Development in Anchorage is very expensive.
They have to move a lot of dirt and there is no value in moving it
until there is a facility there.
MR. SCOTT THOMPSON , CEO, Alaska Power Systems, said they are
currently in the middle of a project that's rather unique. Through
the Alaska Science and Technology Foundation they have developed a
power generation operating system that's being looked at throughout
the world for reduction in power cost in a deregulation
environment. They've got about 70 people employed in Anchorage now
and they are looking for a place to assemble this product. It's
basically a microprocessor board which is a value added product
that has an operating system or firmware and software added to it
after the board is assembled. This is what Federal Express and UPS
needs to anchor a transportation area.
MR. THOMPSON said one of the problems they have found, and has been
pointed out to them by Emerson, is that they do not have an
economic development partnership program with industry. Most
countries in the world today actually have a development
infrastructure program which basically offsets the cost for
industry to develop products within their country. These
countries, such as Ireland and Malaysia, actually host large
companies to do assembly of product. The development money that is
put forth puts the infrastructure in and the return to the country
or state is the jobs that are guaranteed over a certain period of
time.
Emerson has indicated to them on their 40,000 unit order per year,
that they don't care where they build the system. They just don't
want to pay any extra for it. This forces them to look off-shore
to build the hardware. Once the hardware has been established, for
instance in Mexico or Malaysia, it makes the most sense to move all
of the software and firmware jobs to where the hardware is being
developed. It's easier to move management to where the hardware
core is.
The problem with developing this concept here is that there's
absolutely no infrastructure to build the facilities to move the
dirt, to get the people from the lower 48, if they are qualified to
do board assembly. He said there is a great logistics organization
here which has to do with the northern polar route for Federal
Express and UPS, but there's no infrastructure to provide this.
He said these are good paying jobs like $80,000 - $130,000. Most
of the assembly process is all automated along with the handling
and shipping.
MR. THOMPSON said that in Kodiak, for instance, it would make sense
for Tyson to do value added breading of fish sticks.
Number 190
MS. DONNA TOLLMAN, Glennallen, supported SB 159 and said they just
had a meeting where a large representation from Cordova talked
about value added and the cost of site development in rural
communities and the difficulty they are having in coming up with
higher value jobs. In dealing with welfare to work issues, their
residents are finding it difficult to see the value in coming off
of welfare when the jobs they can get are for less money.
She said they have been approached by a number of businesses and
the first question they are asked is what sort of business
incentive program they have. She said they welcome the opportunity
to compete with other states.
Number 237
MS. KATELYN OBNER-MARKLEY, Alaska Industrial Development and Export
Authority, supported SB 159. They believe it is a very good
concept and there are specific things that need to be put in in
terms of objective standards.
CHAIRMAN LEMAN asked her if she had suggestions for objective
standards. She said she would provide that to the committee.
MR. GREG WOLF , AEDC, said he spends a good part of his time talking
to companies about establishing new businesses in the Anchorage
area in the area of distribution, manufacturing, and final assembly
which aren't very well represented now. He said that it is
inevitable that the question of community incentives is raised.
It's the way the game is played; it's a competitive world. This
program is a way of leveling the playing field and pointed out that
they are talking with large companies and small, alike.
MR. TOM LAWSON, Department of Commerce and Economic Development,
said they supported this bill; however, they are concerned about
where the money comes from. He had one technical point in Section
45.81.010 (a)(3) to clarify if a local government doesn't have the
resources to provide any financial backing and supports the bill,
that they don't have to put up money. He thought this bill worked
great for the urban areas, but in other areas, like Glennallen and
Copper River Valley, there aren't any local governments at all.
He thought it shouldn't be limited to just cash from local
governments, but to include land and property tax abatement.
CHAIRMAN LEMAN asked if he had seen the proposed amendments. MR.
LAWSON replied he had and supported both of them. CHAIRMAN LEMAN
said in the second amendment he was trying to create flexibility
within the department so they may put in the grant terms a
repayment plan, if that were to be appropriate.
MS. DEMARCO added that she supported them also.
CHAIRMAN LEMAN said he would set aside SB 159 and work on it until
another meeting.
SB 169 VOLUNTARY FLEX TIME FOR MINES
CHAIRMAN LEMAN announced SB 169 to be up for consideration.
SENATOR MILLER moved to pass SB 169 out of committee with
individual recommendations. There were no objections and it was so
ordered.
CHAIRMAN LEMAN announced a recess at 2:00 p.m.
HB 117 ELEVATOR/BOILER/PRESSURE VESSEL STDS
/CHAIRMAN LEMAN called the meeting back to order at 4:37 p.m. and
announced HB 117 to be up for consideration.
MR. DWIGHT PERKINS, Special Assistant, Department of Labor, said HB
117 would simplify the process of adopting new additions of the
boiler and elevator code. New additions are issued every three
years requiring legislative action to update the enforcement codes
for the State. There has never been any opposition to the new
codes. By transferring the adoption authority to the department,
the process of updating codes will be streamlined and the matter
will not have to take up legislative time and attention.
CHAIRMAN LEMAN asked Mr. Perkins to check with the committee aide
regarding the recent court decision about the adoption of codes to
make sure they have correctly identified what has to be done by
public process. MR. PERKINS agreed.
CHAIRMAN LEMAN said he would hold the bill until next Tuesday.
HB 118 REPORTING OF EMPLOYMENT ACCIDENTS
CHAIRMAN LEMAN announced HB 118 to be up for consideration.
MR. PERKINS said that HB 118 would shorten the time frame for an
employer's reporting of an accident that is fatal to an employee or
that requires inpatient hospitalization. Changes would also be
made regarding the manner in which the report is to be made and the
information that is to be included. To maintain our State
Occupational Safety and Health (OSHA) Program, our standards must
be at least as effective as federal standards and these changes
will bring us into compliance with federal law and there is no
fiscal note.
CHAIRMAN LEMAN asked if there had been any opposition expressed.
MR. PERKINS replied no.
CHAIRMAN LEMAN asked if federal law required reporting of a fatal
accident within eight hours. MR. PERKINS replied yes. CHAIRMAN
LEMAN asked if that had ever been a problem with businesses in
Alaska before. MR. PERKINS replied no and agreed this did not
exclude use of a short wave radio.
CHAIRMAN LEMAN said he would hold HB 118 until next Tuesday.
CHAIRMAN LEMAN adjourned the meeting at 4:40 p.m.
| Document Name | Date/Time | Subjects |
|---|