02/05/2008 01:32 PM Senate L&C
| Audio | Topic |
|---|---|
| Start | |
| SB117 | |
| SB196 | |
| SB230 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
SENATE LABOR AND COMMERCE STANDING COMMITTEE
February 5, 2008
1:32 p.m.
MEMBERS PRESENT
Senator Johnny Ellis, Chair
Senator Gary Stevens, Vice Chair
Senator Bettye Davis
Senator Con Bunde
Senator Lyman Hoffman
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 117
"An Act relating to the presumption of coverage for a workers'
compensation claim for disability as a result of certain
diseases for certain occupations."
MOVED CSSB 117(L&C) OUT OF COMMITTEE
SENATE BILL NO. 196
"An Act relating to establishing a controlled substance
prescription database."
MOVED CSSB 196(L&C) OUT OF COMMITTEE
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 230
"An Act establishing the film office in the Department of
Commerce, Community, and Economic Development; and creating a
transferable tax credit applicable to certain film production
expenditures incurred in the state."
HEARD AND HELD
SENATE BILL NO. 120
"An Act relating to the calculation and payment of unemployment
compensation benefits; and providing for an effective date."
SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: SB 117
SHORT TITLE: WORKERS' COMP: DISEASE PRESUMPTION
SPONSOR(s): SENATOR(s) FRENCH
03/14/07 (S) READ THE FIRST TIME - REFERRALS
03/14/07 (S) L&C, HES, FIN
04/12/07 (S) L&C AT 1:30 PM BELTZ 211
04/12/07 (S) Heard & Held
04/12/07 (S) MINUTE(L&C)
05/03/07 (S) L&C AT 1:30 PM BELTZ 211
05/03/07 (S) Heard & Held
05/03/07 (S) MINUTE(L&C)
02/05/08 (S) L&C AT 1:30 PM BELTZ 211
BILL: SB 196
SHORT TITLE: PRESCRIPTION DATABASE
SPONSOR(s): SENATOR(s) GREEN
01/16/08 (S) PREFILE RELEASED 1/4/08
01/16/08 (S) READ THE FIRST TIME - REFERRALS
01/16/08 (S) L&C, FIN
01/29/08 (S) L&C AT 1:30 PM BELTZ 211
01/29/08 (S) Heard & Held
01/29/08 (S) MINUTE(L&C)
02/05/08 (S) L&C AT 1:30 PM BELTZ 211
BILL: SB 230
SHORT TITLE: FILM OFFICE/ FILM PRODUCTION TAX CREDIT
SPONSOR(s): SENATOR(s) ELLIS
01/16/08 (S) READ THE FIRST TIME - REFERRALS
01/16/08 (S) L&C, FIN
01/25/08 (S) SPONSOR SUBSTITUTE INTRODUCED-REFERRALS
01/25/08 (S) L&C, FIN
02/05/08 (S) L&C AT 1:30 PM BELTZ 211
WITNESS REGISTER
ANDY MODEROW
Staff for Senator French
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Commented on SB 117 for the sponsor.
JEFF BRIGGS
Alaska Professional Firefighters Association,
Anchorage, AK
POSITION STATEMENT: Supported CSSB 117(L&C).
MARK JONES, representing himself
Anchorage, AK
POSITION STATEMENT: Supported CSSB 117(L&C).
GINGER BLAISDELL
Staff to Senator Green
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Commented on SB 196 for the sponsor.
RON MILLER, Regional Manager
Safeway
No address provided
POSITION STATEMENT: Supported SB 196 and the National
Association of Drug Store revisions to make it compliant with a
national standard.
BARRY CHRISTENSEN, Pharmacist
Anchorage, AK
POSITION STATEMENT: Had concerns about funding the program in SB
196.
PATRICIA SENNER
Alaska Nurses Association
Anchorage, AK
POSITION STATEMENT: Had concerns about CSSB 196(L&C).
MAX HENSLEY
Staff to Senator Ellis
Alaska State Capitol
Juneau, AK
POSITION STATEMENT: Commented on SB 230 for the sponsor.
CAROLYN MUEGGE-VAUGHAN, President
Alaska Film Group (AFG)
Juneau, AK
POSITION STATEMENT: Supported SB 230.
BOB CROCKET
Alaska Film Group
Juneau, AK
POSITION STATEMENT: Supported SB 230.
DAMA CHASLE, Partner
The Incentives Office
Los Angeles, CA
POSITION STATEMENT: Supported SB 230.
PROFESSOR MIYA SALGANEK
University of Alaska Fairbanks
Fairbanks, AK
POSITION STATEMENT: Supported SB 230.
GORDON CARLSON, Vice President
CLI Construction
Cantwell, AK
POSITION STATEMENT: Supported SB 230.
JERRY LAVINE, representing himself
Anchorage, AK
POSITION STATEMENT: Supported SB 230.
ANGELA MIELE, Vice President
State Tax Policy
Motion Picture Association
Washington, D.C.
POSITION STATEMENT: Supported SB 230.
BARBARA HUFF-TUCKNESS, Director
Teamsters Local 959
Juneau, AK
POSITION STATEMENT: Supported SB 230.
KATE TESAR, pro-bono lobbyist
Alaska Film Group
Juneau, AK
POSITION STATEMENT: Supported SB 230.
ACTION NARRATIVE
CHAIR JOHNNY ELLIS called the Senate Labor and Commerce Standing
Committee meeting to order at 1:32:27 PM. Present at the call to
order were Senators Bunde, Davis, Stevens and Ellis.
SB 117-WORKERS' COMP: DISEASE PRESUMPTION
1:32:27 PM
CHAIR ELLIS announced SB 117 to be up for consideration.
ANDY MODEROW, staff for Senator French, sponsor of SB 117,
explained the new CS as follows:
This legislation will create a workers' compensation
presumption that certain cardiovascular events,
respiratory diseases and cancers are work related when
contracted by firefighters during a limited timeframe
and within specific parameters. The list of ailments
is limited to diseases that firefighters contract more
often than members of the general public. This list
can be found on page 2, lines 2-13, of the bill.
Certain contagious diseases, such as meningitis and
tuberculosis, are covered under a presumption for
firefighters and other first responders.
In all instances a preponderance of the evidence can
negate this presumption. As an example, someone with
a history of tobacco use is specifically prevented
from the workers' compensation presumption for
respiratory and heart conditions under the
legislation. Other factors including physical fitness,
work history and non-employment activities can be
considered when a claim is filed. A qualifying medical
examination will ensure that the ailment was not
present before the claim is filed.
The presumption for firefighters is restricted to only
those who have served seven years or more, and
coverage for qualifying medical events extends to a
maximum of 60 months after employment ends. I should
also note that exposure to a known carcinogen during
the course of employment must be established for a
cancer claim presumption under the legislation.
Alaska is only one of nine states that haven't
established a workers' compensation presumption for
firefighters, and the 41 states that have similar laws
have found negligible, if any, effects on actuarial
assumptions for claim payouts. CALPERS (the California
retirement system) found no noticeable impact as a
result of the presumption, and workers' compensation
claims actually fell in Illinois during the six years
after a presumption was placed into law.
The new CS before you responds to a concern that the
qualifying medical examination would place an unfunded
obligation on employers across the state. Page 3,
lines 24-30, make it clear that an employer will not
have an obligation to cover the costs of a qualifying
exam. It does provide that an individual has the
option to pay for their own exam if an employer
doesn't provide one. Without an exam, a workers'
compensation claim can still be made, just as current
law allows, but the presumption would not apply.
In short, when our houses are on fire, we run out and
firefighters run in. This legislation gives
firefighters the backup they need when their life-
saving work produces adverse effects to their own
personal health.
1:37:02 PM
SENATOR BUNDE asked if this would cover volunteer fire
departments as well as full-time fire departments.
MR. MODEROW replied yes.
1:37:24 PM
JEFF BRIGGS, Alaska Professional Firefighters Association,
supported SB 117 and the CS. He said all firefighters across the
state appreciate the work they have done on this bill.
MARK JONES, Anchorage Firefighters, supported SB 117 and said he
developed bladder cancer three years ago. This bill provides
important safeguards for firefighters and emergency service
workers.
1:39:52 PM
SENATOR BUNDE noted that he received a letter from Dr. Brown, an
Anchorage physician, stating concerns that some diseases listed
seemed to be focused on men - for instance prostate versus
ovarian cancer.
CHAIR ELLIS said that was a good point and asked Mr. Moderow if
he received that letter.
MR. MODEROW replied no.
SENATOR BUNDE followed up by asking him to take that under
consideration.
1:40:51 PM
CHAIR ELLIS asked Mr. Moderow to go through the CS.
MR. MODEROW said the only change in the CS from the last draft
is on page 3, lines 24-30, where the obligation to pay for the
qualifying medical exam is not placed on the employer. It
provides that the employee can purchase the qualifying medical
examination, but removes the obligation for him to do so giving
the employer the option to provide it.
1:41:33 PM
SENATOR STEVENS moved to adopt CSSB 117(L&C), version E. There
were no objections and it was so ordered.
1:42:04 PM
SENATOR HOFFMAN joined the committee.
SENATOR BUNDE said he would object to moving the bill and
explained that Alaska has a unique workers' compensation system
already in place; it's a very small market with few providers.
He thought passing this bill would put undue stress on that
system. He also thought the cost of premiums would go up with
increased coverage which would be burdensome to municipalities.
CHAIR ELLIS said he didn't expect anything more than a
negligible impact and it could be revisited if their experience
is otherwise.
1:43:51 PM
SENATOR STEVENS moved to pass CSSB 117(L&C) from committee with
individual recommendations and attached fiscal notes. SENATOR
BUNDE objected. A roll call vote was taken. Senators Hoffman,
Davis, Stevens and Ellis voted yea; Senator Bunde voted nay; and
the bill moved from committee.
1:44:43 PM
SB 196-PRESCRIPTION DATABASE
CHAIR ELLIS announced SB 196 to be up for consideration [CSSB
196 (L&C), version K, was before the committee].
1:46:00 PM
GINGER BLAISDELL, staff to Senator Green, sponsor of SB 196
compared the original bill and the proposed CS. The first item
on page 2 was not a change, but she explained, revisiting the
requirement for Schedule 1 through V controlled substances to be
reported had been recommended. She found little differences
between the federal schedules and Alaska State statute schedules
- one being that Schedule I in Alaska includes OxyContin and
codeine; so Schedule I needed to be included in this statute.
Schedule V controlled substances remains because although they
are the low-dose drugs, it is known if they are taken with other
drugs they do create a harmful effect. In Alaska statute,
Schedule V includes certain cough syrups that contain codeines
and steroids, both narcotics, so those need to be tracked.
On page 3, line 12, subsection 4 was rewritten to include only
the name of the person the prescription was written for and not
who is actually picking up the prescription. This saves the
pharmacist data entry time and it's not a standard field to be
collected.
MS. BLAISDELL said subsection 7, in version C on page 3, line
17, was eliminated because it duplicated the same information
that was collected under subsection 6. The following subsections
were renumbered. On page 4, lines 3-5, a sentence was added:
"The board shall undertake to ensure the security and
confidentiality of the database and the information contained
within the database." She explained this means that specific
data requirements will be at the discretion of the Board of
Pharmacy through regulation or operating procedures. The board
will be more aware of data security issues with this type of
program and more restrictive language would not provide it the
flexibility it needs.
1:48:36 PM
The bill also recommends following the 2005 federal National
All-schedules Prescription Electronic Reporting (NASPER)
standards. These allow states to communicate with each other and
to have a similar standard of data. The Board of Pharmacy could
put specific security requirements in its vendor contract, she
added.
1:49:21 PM
On page 4, line 20, (line 21 of the new bill), subsection 5, was
changed slightly to better represent law enforcement's access to
the data. Last week, she said, they heard that Medicaid and
potentially other government agencies would like to have direct
access to the database, but legislative legal, dispensers and
practitioners around the state pointed out concerns with that
because the database could be used to for "fishing expenditions"
to look for any anomalies.
1:50:28 PM
On page 5, line 5, subsection (f), had been replaced with: "The
board may enter into agreements with tribal and military
dispensers and practitioners in this state to submit information
to and access information in the database subject to this
section and the regulations of the board." Currently tribal and
military health care entities do not have to report to a state
mandated program because they follow federal jurisdiction. More
and more states are volunteering to participate in prescription
drug monitoring programs because they find it is in their
clients' best interests.
1:51:10 PM
MS. BLAISDELL said subsection (g) on page 5, line 8, of version
C had been moved into (i); subsection (g) now reads: "The board
shall notify the president and speaker of the house of
representatives if, at any time after the effective date of the
act, the federal government fails to pay the costs of the
controlled substance prescription database."
MS. BLAISDELL noted that this change allows the legislature to
plan for other means of funding without assuming the board would
automatically increase license fees to database users. It is the
intent of the legislature that this database be implemented as a
tool for improving public service and that the cost should not
be assessed to prescribers and dispensers.
1:52:01 PM
Language on page 5, line 11, replaces subsection (f) with: "An
individual who has submitted information to the database in
accordance with this section may not be held civilly liable for
having submitted the information. Nothing in this section
requires or obligates a dispenser or practitioner to access or
check the database before dispensing, prescribing or
administering a medication or providing medical care to a
person. Dispensers or practitioners may not be held civilly
liable for damages for accessing or failing to access the
information in the database."
She explained that computers aren't always available, especially
in Alaska. One instance happened last year in the Iditarod when
someone broke his leg and the doctor had to phone for some pain
medication to be flown out. The person wasn't flown out until a
few days later.
1:53:18 PM
Last, Ms. Blaisdell said, they were asked to include drugs other
than those in the controlled drug list. In response to this,
Senator Therriault introduced SB 38 that asks to include another
drug to the controlled drug list; this is where other drugs
should be added, not in SB 196.
1:53:56 PM
SENATOR BUNDE asked if she had seen the January 21 letter from
the Pharmacy Association and if she felt the CS adequately
addressed its concerns.
MS. BLAISDELL replied yes.
CHAIR ELLIS asked if it was safe to say that version K addressed
all the labor and commerce issues brought up at the last
meeting.
MS. BLAISDELL replied yes.
1:55:29 PM
RON MILLER, Pharmacist and Regional Manager, Safeway, supported
the National Association of Drug Store Chain's revisions to use
a national standard so that multi-state companies could easily
deal with the database entries and reporting periods. He was
concerned with who will pay for the program when all the grants
are gone.
MS. BLAISDELL answered that the general intent of the bill is to
provide a tool to prescribers and dispensers so they can make a
better choice in allowing client access to prescription
narcotics. Prescription abuse is a national trend, and in Alaska
it is a genuine concern because it rolls into a lot of other
criminal activities. This is a positive approach to curbing some
illegal activities in this state.
CHAIR ELLIS asked what happens when the money runs out.
MS. BLAISDELL answered the fiscal note indicates $400,000 for
the first year of start-up costs. Other states have on-going
costs of about $100,000 - $125,000 per year. Savings will be
seen in insurance fraud and over-prescribing and these savings
will make up the difference in the cost of the ongoing program.
CHAIR ELLIS commented that those savings could show up in
different components of the budget, which would have to be
recognized in future budgets.
MS. BLAISDELL agreed.
1:59:24 PM
BARRY CHRISTENSEN, Anchorage Pharmacist, said he was still a
little concerned that the funding for this program would fall on
the backs of the pharmacists. He saw a potential for the need to
double the Board's current budget of $80,000 - $90,000.
SENATOR BUNDE suggested a letter of intent stating that the cost
of this program is not to be borne by private businesses or the
consumers.
MR. CHRISTENSEN said he agreed and added that this is the number
one concern he is hearing from pharmacists.
2:02:18 PM
CHAIR ELLIS commented that a letter of intent wouldn't hold the
bill up.
2:03:06 PM
PATRICIA SENNER, Alaska Nurses Association, had some specific
questions about language in version K. Subsection (b) is unclear
whether the data is to be entered by the prescribing health care
provider, the pharmacists or both. She suggested that using both
would provide quality control. The data collected should also
include whether the patient has a signed pain management
contract and if so, with whom that is.
Subsections (c)(2) and (3) state that the Board of Pharmacy is
collecting data on the health care providers prescribing
patterns and the patients acquiring practices, but doesn't state
what the board is supposed to do with the data. She suggested
adding a line saying the board should alert the appropriate
licensing board if abnormalities are suspected. She also agreed
with a letter of intent stating that the cost of this program is
not to be borne by the license fees.
MS. BLAISDELL responded about the language in subsection (b) on
page 2 is a little confusing because Alaska has a number of
prescribers who also dispense from their practice like
veterinarians and medical doctors. Regarding Ms. Senner's second
concern, she said other language already exists in statute on
the board alerting others of certain types of activities. The
language in SB 230 clarifies that the data this bill collects
looks at "practices or trends" that are determined by the Board
of Pharmacy, not a single event.
CHAIR ELLIS asked Ms. Blaisdell to work with Ms. Senner on
intent language.
2:07:17 PM
SENATOR STEVENS moved to adopt CSSB 117(L&C), version K. There
were no objections and it was so ordered.
SENATOR BUNDE commented that he would be more comfortable with
the letter of intent.
CHAIR ELLIS gave his word that acceptable language on the
financial commitment/impact would be written and that it would
follow the bill.
2:08:39 PM
SENATOR STEVENS moved to pass CSSB 196(L&C) from committee with
individual recommendations, attached fiscal notes and the future
letter of intent. There were no objections and it was so
ordered.
SB 230-FILM OFFICE/ FILM PRODUCTION TAX CREDIT
2:10:45 PM
CHAIR ELLIS announced SB 230 to be up for consideration. He said
he was very excited about this legislation, because it's an
important step towards diversifying Alaska's economy. Forty-five
states have active film offices and it is a very competitive
business for big bucks, lots of jobs and lots of business
impact. Almost all of those states have some kind of incentive
program; 12 states offer transferable tax credits and many
others do direct grants.
He said this bill proposes transferable tax credits. He
reminisced when oil dropped from $29 to $8/barrel and the very
successful film office in Alaska got dropped. He thought that
was a shortsighted decision, but now they have a chance to
rectify that shortcoming. Films that Alaska lost include "The
Guardian" with a production budget of $80 million was set in
Kodiak, but filmed in Louisiana, and "Insomnia," production
budget of $46 million, set in Nightmute but was filmed in
British Columbia. He noted that an upcoming production is set in
Sitka, but is being filmed in Massachusetts.
2:13:35 PM
MAX HENSLEY, staff to Senator Ellis, sponsor of SB 230,
explained that section 1 on page 1 established the ability for
the Department of Revenue (DOR) and the Department of Commerce,
Community & Economic Development (DCCED) to give tax credits to
film producers for a certain percentage of their qualified
spending on projects that qualify. This credit is transferable
and fully divisible and functions much like the tax credits for
capital projects and oil exploration.
Page 2, line 5, section 2, outlines the duties of the film
office and requirements for the film incentive program. He said
the current film office is staffed by a one-quarter time
position in the DCCED and this expands the roll of the position
to be more of what it was previously - to promote the State of
Alaska as a filming location and to assist producers who wish to
take advantage of the Alaska scenery.
Page 3, lines 1-19, determine a production's eligibility. A
producer must spend at least $50,000 in the state on qualified
expenditures to be eligible; they must employ interns from the
Film Internship Training Program (which will be certified at the
University of Alaska through this bill), and the production must
be approved by the Film Office. It won't allow news, sports,
weather, political ads, programs that are distributed for
internal corporate use, nor any sort of pornographic or obscene
production.
2:17:07 PM
Language on line 20 sets up the application process; producers
must submit a script or synopsis of what they plan to film to
the Film Office, some of the key personnel involved, estimated
dates and distribution plan for the final project. The tax
credit process starts on page 4, line 3. After the filming is
complete the production will submit an audited report to the
Film Office which will set out the amount and type of spending
that was done in the state. The tax credit will be awarded equal
to 25 percent of that spending with an additional 10 percent
bonus on qualified expenditures that are wages paid to Alaska
residents. An additional 1 percent goes for any expenditures
made in a rural area or any expenditures made between October 1
and March 30 during the traditional slower season for this
industry.
Finally, on page 4, lines 26 - page 5, line 29, defines
qualified expenditures, which are things directly related to the
film's production. It does not include indirect costs, marketing
and advertising - anything that is reimbursed at a later date.
SENATOR BUNDE asked what the profit margin is on a $30, $60 or
$80 million film and what the potential tax liability would have
been if one of those films been produced in Alaska. He was also
concerned with how "obscene" is defined since he would consider
many recent films to be obscene.
CHAIR ELLIS said the state would probably go by the existing
film rating system that is well established.
MR. HENSLEY said that producers have told him they would want a
better definition and suggested adopting the U.S. Code
definition, which very clearly states what is pornographic and
obscene.
2:20:37 PM
SENATOR STEVENS wanted to know about the Film Production
Internship Training Program and to make sure the University is a
willing participant in establishing it.
SENATOR BUNDE asked for an explanation of the fiscal note that
starts out at $290,000, drops to $33,000 and then jumps up to
$323,000.
2:21:27 PM
CAROLYN MUEGGE-VAUGHAN, President, Alaska Film Group (AFG), and
BOB CROCKETT, Board Member, Alaska Film Group, introduced
themselves.
2:23:59 PM
MS. VAUGHAN said AFG is a non-profit trade association whose
goal is the same as Alaska's - progress from activity in putting
Alaskans to work. She called SB 230 "our next gold rush." She
said it creates diversification of our economy, new private
sector jobs, new training programs, jobs for interns, crew and
Native Alaskans, infusion of construction dollars, millions of
dollars worth of PR, opportunities in rural Alaska and tax
credits for corporations.
SB 230 uses similar components of other successful incentive
programs from states like Louisiana and New Mexico. She said a
plethora of people will be used and hired; money will be spent
in Alaskan communities.
MR. CROCKETT added that Alaska isn't competitive and it is one
of a few states without an incentive program. The first thing a
production company asks is if you have an incentive program; if
you don't they walk away. With no incentive program these
communities are losing out on opportunities. As an added
benefit, many companies will leave infrastructure behind for
future and local productions to use. He recognized the economic
impacts of "Northern Exposure" that allotted $839,000 to each
episode in its beginning, but ended up costing $92 million to
produce in its four years. An estimated "ground-spend" of 75
percent put over $69 million into Washington's economy. Each
year a moose fest is still held in Rosalyn, Washington, where
the series was shot and it continues to attract loyal fans and
their money.
"Men in Trees," another recent show, is being shot in Vancouver,
Canada, but it is about Alaska, he said. They spend $1
million/day, but the only Alaskan put to work is a
cinematographer who spends a few days shooting the backdrops and
Alaskan product placements.
2:25:37 PM
A reality-based TV show called "Deadliest Catch" is now in its
third season with a ground- spend of $3.7 million. It has a crew
of about 30 people and only 2 are Alaskans. He said features
bring in the most; a recent feature, "30 Days of Night," was all
about Barrow but was shot in New Zealand for an estimated
ground-spend of $37.5 million. He said, "These are the projects
SB 230 will target."
MR. CROCKETT said the average cost to produce and market a
feature film is $100.3 million. In 2006 there were 607 features,
an increase of 72 films, which translates into $722 million.
MS. VAUGHAN said their competition is global. She took the crew
around who thought the perfect setting for "Insomnia" was
Seward, but it was shot in British Columbia because of the
money. The estimated ground-spend for that production was $37.7
million.
She said Canada has created infrastructure around its film
industry. They are so booked now they don't have enough crew to
meet their demands. The U.S. is also Alaska's competition. She
said "The Guardian" was set in Alaska, but only one week was
shot in Kodiak; the rest was shot in Louisiana and South
Carolina. After Louisiana created its incentive program, the
film production went from $7 million to $343 million in just two
years. In 2003 the film spending supported 5,437 jobs and in
2005 it went to 13,445 jobs and after five years the industry
there had ground spend of $500 million. In 2007, Louisiana had
three TV series and 343 features. They did it through their tax
credit program.
MS. VAUGHAN related that Louisiana has a 25 percent investor tax
credit, a 10 percent credit on Louisiana payroll and a 40
percent credit on infrastructure and development. Since 2001,
Louisiana and New Mexico have experienced a compound annual
employment growth of 23 percent.
2:27:51 PM
MR. CROCKETT said an upcoming Disney film, "The Proposal,"
starring Sandra Bullock is set in Sitka, but it is actually
being shot in Massachusetts. The producers have told AFG they
would love to shoot in Alaska. He said Alaska has long been a
popular setting for films and TV; just look at the ones that got
away.
2:28:32 PM
MS. VAUGHAN and Mr. CROCKETT showed a display done by the
Association of Film Commissioners International on the daily
economic ground spends of different kinds of film projects
saying that high-end budget films, full crew, union scale spends
about $100,000/day. "Deadliest Catch" which is very popular is
at the bottom of the chart at about $15,000/day.
2:28:56 PM
MR. CROCKETT said that wages compare to the North Slope and
feature films use union scale rates; commercials are even
higher. He emphasized that Alaska has a lot to offer - our
beautiful scenery, the mystique, professional crews - but one
item missing is the incentive program. It would bring growth and
development.
MS. VAUGHAN recapped that SB 230 creates jobs, diversifies the
community, stimulates tourism, builds infrastructure and support
services and provides opportunities for rural Alaska. It
develops educational and internship programs and it provides
transferable tax credits for Alaskan corporations.
2:30:54 PM
DAMA CHASLE, Partner, The Incentives Office, Los Angeles, said
she is a former Fox and Warner executive and that many shows
they discussed today would have been filmed in Alaska but for
the cost. She said the U.S. dollar is at an all-time low and
it's time to compete and have a film incentive that can really
stimulate a diversified economy and allow Alaskans to be part of
craft services. In addition to the benefits mentioned, she said
there is the pride in working in an industry that is state-of-
the art. Film is moving from 35 mm standard film into high
definition. Even the low cost project, "Deadliest Catch," a non-
scripted, non-starring reality show, but even that is an
expensive endeavor. It starts with someone making the food and
catering clear up to the stars. She was part of the Louisiana
endeavor. She watched jobs in Louisiana increase from a ground
spend of $20 million/year in November 2002 when they passed
their first bill to over $350 million two years later. Currently
it is over $500 million/year.
She has been part of the U.S. Incentive Planning Team with the
Motion Picture Association of America, and she encouraged them
to think very positively about this industry saying, "We're
lean; we're mean; we're green; and...we typically don't
pollute." Many producers will select Alaska with financial
incentives, and it will grow Alaska business and enhance the
cultural economy.
2:36:07 PM
PROFESSOR MIYA SALGANEK, University of Alaska Fairbanks (UAF),
said she teaches theatre and film directing and production
classes. She related that she went to the Sundance Film Festival
as a co-producer of a Fairbanks film that was selected for
Sundance in its spectrum category. It was written by a UAF
graduate student and was produced by people in Los Angeles who
called her. She had a group of students participate, all of whom
became production assistants and transferred away from UAF
because its film program is inadequate. She said students all
the way from high school up have a desperate interest and need
to be involved in dramatic arts. For those students that isn't
the world of the stage; it is the world of theatre, of YouTube,
of cinema, of production. SB 230 provides a unique opportunity
to help encourage that growth and development to the next level.
PROFESSOR SALGANAK said she is working with two productions now
- one as director at Sundance and with another group the AFG has
been involved with. Both productions are looking to shoot this
summer and they are both waiting to find out what will happen
with SB 230. She added that the film community is excited about
not having to represent Alaska from an outsider's point of view.
The incentive program would help hone the skills of Alaskans so
they would meet the needs of the workforce. Alaska has more than
enough people to fill these jobs, and she didn't see why we
should have to import people from L.A. to do them.
SENATOR STEVENS asked if the University would establish an
internship program if this bill passed.
PROFESSOR SALGANEK replied "Most definitely." She explained that
her students started out as interns and they were quickly
promoted to production assistants for one film. She is taking a
class to Barrow this summer and some students are being trained
to do scientific documentary work. The University is working now
to create an interdisciplinary film program using students and
faculty from journalism, art, history and English as well as
theatre and film studies.
2:40:26 PM
GORDON CARLSON, Vice President, CLI Construction, said he is
located in Cantwell AK and supported SB 230. He said he worked
on "Into the Wild" and it brought $3-$4 million to the
community. It affected local restaurants, motels, hotels,
carpenters, and laborers; it was a huge shot in the arm when
they stated filming in April. Now he is getting phone calls from
different people who want to visit his area as tourists.
2:42:20 PM
JERRY LAVINE said he has a production and equipment support
company in Anchorage that caters to the film and video industry.
A majority of business comes from outside Alaska, and he would
like to see the industry grow; SB 230 would help it go in the
right direction. He explained that his business and other local
companies could invest in more equipment that would meet the
needs of producers coming to Alaska who would then not have to
ship equipment up here. Also, if this bill passes and more
movies get produced here, companies like his don't even have
enough equipment and this would make it possible for them to get
more faster. He advised that tax credits work better than
rebates, because it provides an incentive to earn the credits
rather than just receiving the money.
He also advised that they should also consider the duties of the
office being created. It would provide assistance in permitting,
location scouting, and serve as a liaison between other local
groups and organizations. They should ask themselves if the
state should be involved with location scouting; maybe the
production should pay for it up front and get it as a qualified
expenditure. The same for permitting on state land. He also
thought the title of the office could be named so that it would
favorably affect marketing. Some states offer no caps or minimum
expenditure on the qualified expenditures, but that could be
figured out.
He urged them to consider that the 25 percent base credit didn't
go to enough Alaskans first. Instead, he suggested offering a 5
percent base amount to the production coming up here, and 25
percent more if they hire Alaskans, and maybe add another 5
percent for going to a rural area - and another 5 percent for
working between October 1 and April 30. He exhorted them to make
the production earn the qualified expenditures. He thought the
Internship program at the University was a great idea and
suggested including certification of any private training
programs that may be created through the industry as it grows.
2:50:12 PM
ANGELA MIELE, Vice President, State Tax Policy, Motion Picture
Association (MPA), said the MPA is a trade association
representing the nation's leading producers and distributors of
motion pictures and television programs. In her roll she
oversees the tax issues affecting member company business
practices around the country. She has seen a dramatic surge of
states adding film production incentives or increasing their
existing ones. This is due to a lot of increased
competitiveness, and a lot of states are realizing the economic
impact of these productions. They want to attract permanent
infrastructure and capital investment; it has really paid off.
2:51:59 PM
MS. MIELE cautioned them against using the MPA rating system,
which has been found to be unconstitutional; so she would go
with the federal provisions. The elements of the bill are very
competitive; it seems unencumbered with caps and limitations
which is key to a successful program. It is easy to access with
clear eligibility. She said countless studies have been done on
how much economic activity comes from film productions, which
they have heard about.
2:53:43 PM
BARBARA HUFF-TUCKNESS, Director, Governmental and Legislative
Affairs, Teamsters Local 959, supported SB 230. They are excited
about the job opportunities it will create in the state.
2:54:46 PM
KATE TESAR, pro-bono lobbyist, Alaska Film Group, said SB 230
has been developed in close association with people in the
industry and incorporates what has worked best in other states.
She said it has benefits for Alaskans through the transferable
tax credits for corporate Alaskans.
SENATOR STEVENS said it's a fascinating topic, but they need
more information about the history of Alaska's Film Office. He
asked Commissioner Notti, Department of Commerce, Community &
Economic Development, to give them a report on what the state
did wrong at that time.
SENATOR BUNDE said he wanted to see a potential net gain for the
$300,000 it will cost each year to run the office.
2:57:38 PM
CHAIR ELLIS said all the work on this legislation needs to
happen in this committee, because it only goes to the Finance
Committee afterwards.
SB 230 was held in committee.
SB 196-PRESCRIPTION DATABASE
2:58:38 PM
CHAIR ELLIS said the letter of intent had been delivered on CSSB
196(L&C).
SENATOR BUNDE moved to adopt the letter of intent and to send it
on with the bill. There were no objections and it was so
ordered.
There being no further business to come before the committee,
Chair Ellis adjourned the meeting at 2:59:07 PM.
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