02/28/2017 03:30 PM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| SB46 | |
| SB21 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 46 | TELECONFERENCED | |
| += | SB 21 | TELECONFERENCED | |
| += | SB 26 | TELECONFERENCED | |
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE STATE AFFAIRS STANDING COMMITTEE
February 28, 2017
3:31 p.m.
MEMBERS PRESENT
Senator Mike Dunleavy, Chair
Senator David Wilson
Senator Cathy Giessel
Senator Dennis Egan
MEMBERS ABSENT
Senator John Coghill
COMMITTEE CALENDAR
SENATE BILL NO. 46
"An Act establishing October 25 of each year as African American
Soldiers' Contribution to Building the Alaska Highway Day."
- MOVED SB 46 OUT OF COMMITTEE
SENATE BILL NO. 21
"An Act relating to appropriations from the income of the Alaska
permanent fund; relating to the calculation of permanent fund
dividends; and providing for an effective date."
- MOVED SB 21 OUT OF COMMITTEE
SENATE BILL NO. 26
"An Act relating to the Alaska Permanent Fund Corporation, the
earnings of the Alaska permanent fund, and the earnings reserve
account; relating to the mental health trust fund; relating to
deposits into the dividend fund; relating to the calculation of
permanent fund dividends; relating to unrestricted state revenue
available for appropriation; and providing for an effective
date."
- SCHEDULED BUT NOT HEARD
PREVIOUS COMMITTEE ACTION
BILL: SB 46
SHORT TITLE: OCT 25: AFRICAN-AMERICAN SOLDIERS ALASKA HWY DAY
SPONSOR(s): SENATOR(s) WILSON
02/01/17 (S) READ THE FIRST TIME - REFERRALS
02/01/17 (S) TRA, STA
02/14/17 (S) TRA AT 1:30 PM BUTROVICH 205
02/14/17 (S) Heard & Held
02/14/17 (S) MINUTE(TRA)
02/16/17 (S) TRA AT 1:30 PM BUTROVICH 205
02/16/17 (S) Moved SB 46 Out of Committee
02/16/17 (S) MINUTE(TRA)
02/17/17 (S) TRA RPT 4DP
02/17/17 (S) DP: STEDMAN, BISHOP, WILSON, EGAN
02/28/17 (S) STA AT 3:30 PM BUTROVICH 205
BILL: SB 21
SHORT TITLE: PERMANENT FUND: INCOME; POMV; DIVIDENDS
SPONSOR(s): SENATOR(s) STEDMAN
01/18/17 (S) READ THE FIRST TIME - REFERRALS
01/18/17 (S) STA, FIN
02/02/17 (S) STA AT 3:30 PM BUTROVICH 205
02/02/17 (S) Heard & Held
02/02/17 (S) MINUTE(STA)
02/16/17 (S) STA AT 3:30 PM BUTROVICH 205
02/16/17 (S) Heard & Held
02/16/17 (S) MINUTE(STA)
02/21/17 (S) STA AT 4:30 PM BUTROVICH 205
02/21/17 (S) Heard & Held
02/21/17 (S) MINUTE(STA)
02/22/17 (S) FIN AT 1:30 PM SENATE FINANCE 532
02/22/17 (S) -- MEETING CANCELED --
02/28/17 (S) STA AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
SENATOR DAVID WILSON
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 46.
GARY ZEPP, Staff
Senator David Wilson
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Provided an overview of SB 46.
KATRINA BEVERLY GILL, representing self
State of Maryland
POSITION STATEMENT: Testified in support of SB 46.
JEAN POLLARD, Chair
Alaska Highway Memorial Project
Anchorage, Alaska
POSITION STATEMENT: Testified in support of SB 46.
VERDIE BOWEN, Director
Office of Veterans Affairs
Alaska Department of Military and Veterans Affairs
Anchorage, Alaska
POSITION STATEMENT: Testified in support of SB 46.
BERT LARKINS, representing self
New Orleans, Louisiana
POSITION STATEMENT: Testified in support of SB 46.
MARK FISH, representing self
Big Lake, Alaska
POSITION STATEMENT: Testified in opposition of SB 46.
KAREN JONES, representing self
Wasilla, Alaska
POSITION STATEMENT: Testified in opposition of SB 46.
SENATOR BERT STEDMAN
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Sponsor of SB 21.
CHRISTA MCDONALD, Staff
Senator Mike Dunleavy
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Reviewed Amendment 1 for SB 21.
ACTION NARRATIVE
3:31:23 PM
CHAIR MIKE DUNLEAVY called the Senate State Affairs Standing
Committee meeting to order at 3:31 p.m. Present at the call to
order were Senators Wilson, Giessel, Egan, and Chair Dunleavy.
SB 46-OCT 25: AFRICAN-AMERICAN SOLDIERS AK HIGHWAY DAY
3:31:57 PM
CHAIR DUNLEAVY announced the consideration of SB 46.
3:32:27 PM
SENATOR DAVID WILSON, Alaska State Legislature, Juneau, Alaska,
sponsor of SB 46, read the sponsor statement for SB 46 as
follows:
Senate Bill 46 recognizes the contributions of African
American Soldiers in building the Alaska Highway and
commemorates those extraordinary efforts by
establishing October 25thas "African American
Soldiers' Contribution to Building the Alaska Highway
Day."
Why October 25th? On this day, African American Army
troops of the 93rdand 95thregiments constructing the
Alaska-Canadian (ALCAN) Highway north from Dawson
Creek, met the white troops constructing the ALCAN
Highway heading south. The troops connected the two
segments on October 25, 1942, at Contact Creek, near
Mile Post 590 in the Yukon Territory.
Four regiments of African American Army Engineers from
the 93rd,95th, and the 97thEngineer General Services
th
Regiments and the 388Engineer Battalion were
deployed to Alaska to assist in building the 1,500
miles of road (The highway cost $138 million to build
at that time). The 10,607 men, of which a third were
African American, built the road in eight months and
12 days. This extraordinary accomplishment was
compared to the construction of the Panama Canal.
Little recognition has been given to the African
American soldiers for their contributions in building
the ALCAN Highway; for example:
· The National Archives contains only a few dozen
photos of the African American troops among the
hundreds taken of the ALCAN Highway construction;
· African Americans were edited out of a 1991
National Geographic feature on the ALCAN highway,
despite the fact that the magazine obtained
interviews of seven men who served building the
ALCAN;
· And, the official 759-page U.S. Army history of
the Corps of Engineers covers African Americans'
involvement with a one-sentence footnote.
The road was built as an overland route across Alaska
during World War II (WW II) for strategic purposes in
our country's fight against Japanese aggression. A
shortage of manpower early in WW II led to the U.S.
Army's decision to send African American troops to
Alaska to assist in the ALCAN Highway construction.
At the formal dedication of the road, Brigadier General
James A. O'Connor singled out the African American
troops for special recognition, "Someday the
accomplishments of these African American soldiers -
achievements accomplished far from their homes - will
occupy a major place in the lore of the North
country," he promised. Because of the African American
troop's performance in contributing to the
construction of the ALCAN Highway, military and
civilian leaders decided to desegregate the armed
services in 1948. The Federal Highway Administration
has called the ALCAN Highway, "the road to civil
rights."
This year, 2017, marks the 75thanniversary of the
ALCAN Highway. It's fitting we recognize these men and
celebrate their contributions in constructing the
ALCAN Highway!
3:35:09 PM
GARY ZEPP, Staff, Senator David Wilson, Alaska State
Legislature, Juneau, Alaska, read an introductory overview of SB
46 as follows:
On December 7, 1941, the Japanese bombed Pearl Harbor
in Hawaii. America's next concern of World War II was
how close Alaska was to Japan and that fear became a
reality after the Japanese bombed Dutch Harbor on June
3 and June 4, and invaded Attu and Kiska in the
Aleutian Islands in 1942 as well. American's reaction
was to build an overland route across Alaska and
Canada in order to support the troops and the
supplies. This had to be accomplished quickly and the
U.S. troops met the call; they finished the original
Alaska highway in eight months and a few days. This
was an extraordinary engineering accomplishment for
its time. Most African-American soldiers at that time
were delegated to labor projects and not usually sent
into battle because the military's assessment of
African-American soldiers was thought to be
substandard when compared to white troops and skills
and literacy; that changed after the original
construction of the Alaska Highway.
3:36:29 PM
MR. ZEPP explained the reason for commemorating October 25 as
follows:
Why October 25th as Senator Wilson stated? Two crews,
one moving north and one moving south completed the
road's last link. Later the New York Times reported
what happened when they, "met head on in the spruce
forest of the Yukon Territory." This is Corporal
Refines Sims Jr., an African American from
Philadelphia, who was driving south with his bulldozer
when he started to see trees toppling over on him, on
the other side he slammed his vehicle in reverse and
backed out just as another bulldozer driven by Private
Alfred Jalufka of Kennedy, Texas, broke through the
underbrush. The wire-service photographer captured
this image, one African American, one white standing
on their respective bulldozers, this occurred 20 miles
east of the Alaska-Yukon border as the senator
referred to; an article in the Engineering News Record
described it as, "Two races working together to build
a lifeline to Alaska's defenders amidst spectacularly
rugged terrain and horrendous weather conditions."
He reviewed a map of the Alaska Highway and commented as
follows:
The Alaska Highway is considered one of the biggest
and most difficult construction projects ever
completed by the U.S. Corps of Engineers; it stretches
1,422 miles from Dawson Creek, British Columbia, to
Delta Junction Alaska, at a cost of $138 million in
1942, taking that in today's dollars equals $2.1
billion. As a side note and to put it into
perspective, on March 30, 1867, Secretary of State
William Seward reached agreement with Russia to
purchase Alaska for $7.2 million, that's $112.2
million in today's dollars.
3:38:23 PM
MR. ZEPP presented a video: Alaska Highway - "The Road to Civil
Rights."
3:42:52 PM
He thanked the National Park Service and the U.S. Department of
Interior for the video. He continued his presentation as
follows:
The African American Army regiments that built the
Alaska Highway established a reputation for
excellence, especially in the field of bridge
building; however, their accomplishments were ignored
by mainstream media and press. It took decades for
them to receive proper recognition for their
achievements. Some say they were as "legendary" as the
Tuskegee Airmen and the Buffalo Soldiers.
He addressed "Why the recognition of the African American
Soldiers?" as follows:
It's about historical context. Race relations in
America were very different in 1942 and opportunities
for African Americans were rare and expectations were
low. Racial segregation included: housing, medical
care, education, transportation, and social
segregation (restaurants, drinking fountains,
bathrooms, etc.).
The movie "Alaska at War" was a documentary on
Alaska's role in World War II, such as the opening of
oil fields, the Japanese bombing of Dutch Harbor, the
struggle to recapture the Aleutian Islands, and the
construction of the highway. "Not on African American
soldier was shown in the movie," stated Eugene Long,
who was enlisted in the 95th Engineer Regiment
deployed to Alaska to assist in building the Alaska
Highway.
3:44:17 PM
MR. ZEPP addressed "Why the recognition of the African American
Soldiers?" by considering the following timeline for the
Safeguards of Civil Rights:
· 1865: 13th Amendment to the U.S. Constitution
abolished slavery and involuntary servitude.
· 1868: 14th Amendment of the U.S. Constitution granted
U.S. citizenship to former slaves.
· 1870: 15th Amendment to the U.S. Constitution provided
African American men the right to vote.
· 1875: The Civil Rights Act of 1875 was passed and
forbid racial segregation in accommodations.
· 1896: U.S. Supreme Court sustained the
constitutionality of Louisiana's requirement that
railroad companies provide "separate but equal"
accommodations for white and black passengers.
· Over the next 25-35 years, equality in racial
relations progress was lost, particularly in the
South. By 1910, segregation was firmly established
across the South and most of the border region.
· 1954: Legal segregation in schools was banned in the
U.S. after a series of rulings in the U.S. Supreme
Court.
· 1964: All legally enforced public segregation was
abolished by the Civil Rights Act.
The U.S. War Department's tradition and policy
mandated the segregation of African Americans into
separate units, led by white officers. During the
construction of the Alaska Highway, African American
troops were ordered to not leave camp and mingle with
the locals, while the whites were allowed to mingle.
They were treated unequally and yet defied
expectations in many situations, with even fewer
resources.
He addressed "Why the recognition of the African American
Soldiers?" as follows:
Little press or mainstream media has been given to the
African American soldiers, examples of the lack of
press coverage of the African American troops include:
· National Archives contains only a few dozen
photos among the hundreds taken of the Alaska
Highway construction.
· African Americans were edited out of a 1991
National Geographic feature on the highway,
despite the fact that the magazine obtained
interviews of seven men who served building the
Alaska Highway.
· A souvenir booklet, "Alaska Highway, Army Service
Forces," published in 1944 includes 100 photos
but only one of an African American soldier.
· The official 759-page U.S. Army history of the
Corps covers African American troop involvement
with a one-sentence footnote.
3:46:40 PM
MR. ZEPP addressed "Why the recognition of the African American
Soldiers?" as follows:
This event and others that followed during World War
II influenced our American leaders and some believe
that it was a turning point in race relations in
American. By 1948, President Truman signed into law a
desegregation plan for the armed forces.
In 1992, Colin Powell, Chairman of the Joint Chiefs of
Staff, after seeing Ms. Lael Morgan's exhibit in
Fairbanks stated, "I had no idea black men had done
anything like this." "They are deserving of
recognition."
Douglas Brinley, Rice University Historian, "The
Alaska Highway was not only the greatest feat of World
War II; it is a triumph over racism."
General James O'Connor, during the Alaska Highway
dedication stated, "Someday the accomplishments of the
African American troops' achievements accomplished far
from their home will occupy a major place in the lore
of the North country."
This happened in Alaska.
MR. ZEPP presented a video presentation on the Alaska Highway
that featured Mr. Reginald Beverly, 95th Engineer Regiment. He
disclosed that Mr. Beverly is currently 102 years old.
3:49:06 PM
He addressed "Acknowledgment and Thanks" as follows:
The legacy of the African American Army soldiers
wouldn't be known today nor officially recognized by
the military if not for the works of many. Just to
name a few:
· The U.S. Park Service;
· U.S. Army Corp of Engineers;
· Heath Twitchell Jr. (Historian);
· James Eaton (Curator of the Black History Archive
at Florida A&M University);
· Ted Stevens (U.S. Senator);
· Andrew Molloy (Head of Pentagon's Affirmative
Action Office);
· Colin Powell (Retired Four Star General);
· Stan Cohen (Author);
· John Virtue (Author);
· Mike Dunham (Anchorage Daily News);
· Cornelia Dean (New York Times);
· Tim Ellis (KUAC News);
· Rickie Longfellow (News Writer);
· Bill Gifford (Washington City Paper);
· Kani Saburi Ayubu (Black Art Depot Today);
· Douglas Brinley (Rice University-Historian);
· Jean Pollard (Educator);
· Lael Morgan (University of Alaska-Professor of
Journalism).
Thank you all for your contributions in revealing this
remarkable story and your support of Senate Bill 46's
efforts to establish October 25th as "African American
Soldiers' Contribution to Building the Alaska Highway
Day."
He encouraged all Alaskans and visitors to attend the Alaska
Highway's 75th anniversary events throughout the state during
the upcoming summer.
CHAIR DUNLEAVY thanked Mr. Zepp for his presentation. He opened
invited testimony for SB 46.
3:50:56 PM
KATRINA BEVERLY GILL, representing self, State of Maryland,
testified in support of SB 46. She revealed that she is the
daughter of Veteran Reginald Beverly, previously noted in Mr.
Zepp's presentation. She detailed that Mr. Beverly is one of
over 4,000 black soldiers who built the Alaskan Highway in 1942.
She provided the committee with details of Mr. Beverly's
experience in building the ALCAN Highway as well as his
educational and vocational history. She set forth that she
supported SB 46 to recognize the contributions of African
American soldiers who worked extremely hard on the Alaska
Highway and completed the task in record time prior to the time
that was given.
CHAIR DUNLEAVY thanked Ms. Gill and Mr. Beverly for his service
to his country.
3:55:18 PM
JEAN POLLARD, Chair, Alaska Highway Memorial Project, Anchorage,
Alaska, testified in support of SB 46. She set forth that it is
time to recognize the achievements of the African Americans that
built the Alaska Highway. She noted that when she graduated from
college she did not know about the history of the Alaska
Highway. She stated that SB 46 will ensure that future
generations will learn about the contributions of the African
American soldiers that built the Alaska Highway.
4:00:53 PM
VERDIE BOWEN, Director, Office of Veterans Affairs, Alaska
Department of Military and Veterans Affairs, Anchorage, Alaska,
testified in support of SB 46. He remarked that the greatest
aspect of SB 46 is the fact that it recognizes a third of those
that built the Alaska Highway and did so with less than the rest
of the soldiers. He said the contribution by the African
American soldiers proved that under great, extreme difficulties
that not only were they the same soldier, but equal too. He said
what the African American soldiers did on the Alaska Highway was
just as significant as the military desegregation that occurred
in 1948.
4:02:30 PM
BERT LARKINS, representing self, New Orleans, Louisiana,
testified in support of SB 46. He revealed that his father was
one of the black soldiers that built the Alaska Highway. He
disclosed that his father was ecstatic when he heard the black
soldiers that built the Alaska Highway would be recognized for
their accomplishment.
4:05:28 PM
MARK FISH, representing self, Big Lake, Alaska, testified in
opposition of SB 46. He asked that SB 46 be amended to recognize
all soldiers for an Alaska Highway Day. He disclosed that his
grandfather had worked on constructing the ALCAN Highway. He
admitted that the bill is well intended, but informed that both
blacks and whites had worked together in a racially divided
country for a common cause in building the ALCAN Highway.
4:08:31 PM
KAREN JONES, representing self, Wasilla, Alaska, testified in
opposition of SB 46. She asked that the bill be amended to
include all soldiers. She disclosed that her father was a
civilian contractor on the Alaska Highway. She noted that her
father endured challenging conditions during the highway's
construction. She revealed that 12-men died on a resupply
mission during construction. She pointed out that recent history
has noted the contribution of black soldiers in the Alaska
Highway's construction. She stated that October 25 should be a
date that recognizes all that had served during a most difficult
time in the nation's history.
4:12:26 PM
CHAIR DUNLEAVY closed public testimony.
4:12:42 PM
SENATOR GIESSEL moved to report SB 46, version 30-LS0431\A, from
committee with individual recommendations and attached zero
fiscal note.
4:12:54 PM
CHAIR DUNLEAVY announced that there being no objection, SB 46
moved from the Senate State Affairs Standing Committee.
SENATOR GIESSEL commented as follows:
I am happy to support this bill, but one of the things
that I can't fail to notice is the Corps of Engineers
approved this building of the road through wetlands
and permafrost, it was built in less than a year, if
only we could do that today.
CHAIR DUNLEAVY reiterated that SB 46 moved from committee. He
noted that the Delta Junction area will be having a celebration
during the upcoming summer in commemoration of the Alaska
Highway's completion.
4:13:48 PM
At ease.
SB 21-PERMANENT FUND: INCOME; POMV; DIVIDENDS
4:14:51 PM
CHAIR DUNLEAVY announced the consideration of SB 21. He declared
that public testimony is closed on SB 21.
4:15:11 PM
At ease.
4:15:48 PM
CHAIR DUNLEAVY called the committee back to order. He asked
Senator Stedman, sponsor of SB 21, if he had any final comments
or remarks.
4:15:57 PM
SENATOR BERT STEDMAN, Alaska State Legislature, Juneau, Alaska,
sponsor of SB 21, said the bill is an integral part of a fiscal
solution for Alaska. He commented as follows:
There are a lot of Alaskans that are very concerned
that as we try to move through to a fiscal solution,
the biggest pot of gold is the permanent fund sitting
there, roughly $57 billion, a very large, sweet target
of which we could probably appropriate, us in the
Legislature, somewhere around currently $8 billion or
$9 billion and then maybe an additional $4 billion or
so of unrealized earnings. It's very easy to go in for
us in the Legislature to appropriate large sums out of
the permanent fund.
The concern is as we move forward to try to find a
fiscal solution is that we ensure that the viability
of the permanent fund stays intact and that we that
were fortunate enough to live through the vast oil
boom of the last four decades leaves something for our
kids and our children's children on into the future,
that we don't over the next decade just liquidate it
or cripple it in a significant way. We are very
fortunate to be stewards of the subsurface assets in
the State of Alaska unlike all other states, and it's
incumbent upon us to look forward to the next
generation.
Senate Bill 21 would basically ring-fence or set aside
and protect the permanent fund from adverse
withdrawals setting up a percent of market value
management approach to it where you could only take
out 4.5 percent per year of a 5-year moving average of
the fund going back 6 years; and that [4.5] percent,
50 percent of that would go automatically to
dividends, which is 2.25 percent, the other 50 percent
would be available for us in the Legislature to
appropriate either to the general fund to deal with
fiscal issues at the time, when clearly that's the
time we have today, but looking forward there will be
a time when it's not needed and we can appropriate
that back to the permanent fund to make the permanent
fund grow faster, or add it to the dividends if we
want to increase the dividends.
Now this structure is set up ignoring the current
fiscal position of the state; in other words, the
percentage withdrawal amount is driven by the asset
allocation of the fund and its goal is to be in
perpetuity. That 4.5 percent would allow the permanent
fund to not change its management style and would
block us from taking more than 4.5 percent out per
year. It just so happens we are around the mid-50s in
billions in the permanent fund, if we were at $100
billion it would be double the numbers, and if we were
at $25 billion it would be half the numbers. The
dividend calculation defaults out at $1,700; now I
know some folks around the state might think that's
too big of a dividend and some folks might think it's
too small of a dividend, but it's a 50-50 split and it
happens to be the time frame we are in allowing that
balance to be measured at about $55 billion.
So that Mr. Chairman is what is in front of the
committee on a second hearing. I think there's some
amendments and some other discussions, but I just
wanted to take a few minutes to frame it for the
people at home because this is not a bill that fixes
our physical deficit, it is a bill to protect the
permanent fund from us, the Legislature, and to ensure
that we have an intact, vast amount of wealth from our
oil boom going forward to future generations of
Alaskans and we are not talking two or three
generations, we are talking in perpetuity.
4:20:51 PM
SENATOR GIESSEL commented as follows:
I appreciate the carefulness that Senator Stedman has
put into this bill. I especially like that 50-50
split. Certainly, citizens at home receiving their
check in the mail can say, "Okay, this is how much I
got and I know how much government got, I'm going to
keep an eye on how they spend the 50 percent they
got." I think that would create a more engaged
citizenry and that's a good thing.
CHAIR DUNLEAVY asked Senator Stedman if he wanted to touch upon
the future of the fund someday that there may be discussions
about constitutionalization.
SENATOR STEDMAN explained as follows:
I've been asked how come I didn't write the bill and
come forward with a constitutional amendment, it's
because clearly, it's the constitution that protects
the corpus of the permanent fund, we cannot spend it
without authorization of the people. We can spend and
have the authority to as the Legislature, as the
appropriators, all of the earnings and trading profits
of the fund which we call the earnings reserve.
There are two reasons why it's not requested as a
constitutional amendment today. Number one is the
cash-flow draws and needs in the current environment
of the state, I don't think we have the time to get
there right away. Also, I would like to see the
opportunity for all of us in the Legislature to have a
discussion with our constituents to make sure that
they are onboard in protecting the permanent fund for
future generations and they are comfortable with the
endowment approach so that we can move forward. I
think that would be nice if we could have that come
after the statutory bill has passed, which is what we
have in front of us and we have a thorough
understanding at the public level.
This is very clear and transparent, this is not smoke
and mirrors, there's not a lot of moving parts, it's
very straight forward; and then, hopefully we will
have the ability in the future to have a
constitutional amendment and that would enclose the
earnings account, basically there would be no need for
it, it would just go away for all practical purposes,
and we the Legislature could only get our hands-on 4.5
percent per year, and half of that then would go to
the citizens for dividends.
We would not be able to take the easy road, which is
vote huge chunks out of the earnings reserve which we
can do today with a simple majority vote and a
signature by the governor, we can easily move $7
billion or $8 billion this year, and to me it just
makes me want to stay awake at night worrying about
that, it's not any public servant I don't think ever
came to Juneau to see that.
4:23:59 PM
CHAIR DUNLEAVY moved to adopt Amendment 1, labeled 30-
LS0128\O.1:
30-LS0128\O.1
Martin
2/17/17
AMENDMENT 1
OFFERED IN THE SENATE
Page 1, line 2, following "dividends;":
Insert "authorizing an advisory vote on legislative
action that changes the calculation of the permanent
fund dividend and the amount available for
distribution from the earnings reserve account and
making the legislative action contingent on the
advisory vote receiving an affirmative majority vote;"
Page 3, line 19:
Delete all material and insert:
"* Sec. 6. The uncodified law of the State of
Alaska is amended by adding a new section to read:
ADVISORY VOTE. At a special election to be
held on September 26, 2017, in substantial compliance
with the election laws of the state, including
absentee voting and the preparation, publication, and
mailing of an election pamphlet under AS 15.58, the
lieutenant governor shall place before the qualified
voters of the state a question advisory to the
legislature and the governor. The election pamphlet
for the special election must comply with
AS 15.58.020(a)(6), including the requirement that it
contain statements that advocate voter approval or
rejection of the question. Notwithstanding
AS 15.80.005 and other laws relating to preparation of
the ballot proposition, the question shall appear on
the ballot in the following form:
Q U E S T I O N
Do you approve of the passage by the Alaska State
Legislature of a bill that changes the calculation of
the permanent fund dividend and the amount available
for distribution from the earnings reserve account
established under AS 37.13.145?
Yes [ ] No [ ]
* Sec. 7. The uncodified law of the State of Alaska
is amended by adding a new section to read:
NOTICE TO THE REVISOR OF STATUTES. The
director of elections shall notify the revisor of
statutes when the results of the election have been
certified under AS 15.15.450 if the advisory vote
authorized in sec. 6 of this Act receives an
affirmative majority vote.
* Sec. 8. The uncodified law of the State of Alaska
is amended by adding a new section to read:
CONDITIONAL EFFECT. Sections 1 - 5 of this
Act take effect only if the director of elections
notifies the revisor of statutes under sec. 7 of this
Act that the question in the advisory vote under sec.
6 of this Act received an affirmative majority vote.
* Sec. 9. If, under sec. 8 of this Act, secs. 1 - 5
of this Act take effect, they take effect on July 1 in
the year following the year in which the notice is
given under sec. 7 of this Act.
* Sec. 10. Section 6 of this Act takes effect
immediately under AS 01.10.070(c).
* Sec. 11. Except as provided in secs. 9 and 10 of
this Act, this Act takes effect July 1, 2017."
4:24:08 PM
SENATOR GIESSEL objected for purposes of discussion.
4:24:18 PM
CHRISTA MCDONALD, Staff, Senator Mike Dunleavy, Alaska State
Legislature, Juneau, Alaska, said Amendment 1 places an advisory
vote of the people to have SB 21 become effective and explained
as follows:
· Section 6: is the language of the advisory vote that
reads, "Do you approve of the passage by the Alaska
State Legislature of a bill that changes the
calculation of the permanent fund dividend and the
amount of it available for distribution from the
earnings reserve account?".
· Section 7: establishes that the Director of Elections
will notify the reviser of statutes if the vote
receives a majority.
· Section 8: creates a conditional requirement of an
affirmative majority vote in order for Sections 1 to 5
of the bill to become effective which is SB 21 which
you see before you.
· Section 9: states that Sections 1 to 5 of the
legislation will take place on June 1 after an
affirmative majority vote.
· Section 10: issues the advisory vote and states that
it will become effective immediately.
· Section 11: is the rest of the effective dates of the
bill.
CHAIR DUNLEAVY noted that the last advisory vote regarding the
permanent fund went to the people 18 years ago. He pointed out
the permanent fund is a unique instrument not just in this
country, but worldwide. He admitted that there are varying
opinions on the purpose of the permanent fund and the dividend,
but explained that the reason he offered the amendment is that
the people of Alaska are partners with their government
regarding the permanent fund issue and the 50-50 proposition. He
said the people constitutionalized the permanent fund decades
ago during a time when the Alaska Legislature was spending a lot
of money and they wanted to figure out a way to preserve the
money for future generations. He noted that after the permanent
fund was constitutionalized, other instruments as well went to
the people for a vote over a 12-year period, including the
Constitutional Budget Reserve, the appropriations limit, and a
statutory dividend.
4:27:24 PM
SENATOR GIESSEL expressed concern that the amendment calls for a
vote of the people in less than 6 months. She pointed out that
people may not completely understand the fiscal situation and
the gravity of the decision. She added that the special election
means there are extra costs and its turnout will be
unpredictable. She stated that she is not convinced that the
people's feelings will be received with clarity. She reiterated
that she is not convinced that folks would understand the
ramifications of a "yes" or "no" vote. She asked if he had
considered the factors she noted in terms of a special election.
CHAIR DUNLEAVY replied that the people are probably more in tune
with the permanent fund issue than many others that the
Legislature deals with. He opined that the permanent fund issue
is of such magnitude that the people of Alaska should be a part
of it.
SENATOR EGAN noted that Senator Stedman is the sponsor of SB 21
and asked what his thoughts were on the proposed amendment.
4:30:46 PM
SENATOR STEDMAN replied as follows:
The committee of jurisdiction always makes bills
better. I would like to see at the end of the day
constitutional protection for the permanent fund and a
percent-of-market value setup with a reasonable payout
targeted toward the structure and longevity of the
permanent fund, not our cashflow needs, and I think
that's what the bill does. I always respect the will
of the committees.
CHAIR DUNLEAVY noted that SB 21 is referred to another committee
and continued discussions will address the contents of the bill.
He suggested that the bill be moved to the next committee with
the amendment. He asked if the objection was maintained.
SENATOR GIESSEL maintained her objection.
CHAIR DUNLEAVY asked that a roll call vote be taken on Amendment
1.
A roll call vote was taken. Senator Wilson and Chair Dunleavy
voted in favor of Amendment 1 and Senators Giessel and Egan
voted against it. Therefore, Amendment 1 failed by a 2:2 vote.
4:32:41 PM
At ease.
4:45:14 PM
CHAIR DUNLEAVY called the committee back to order. He asked if
there was a motion to move SB 21.
4:45:20 PM
SENATOR GIESSEL moved to report SB 21, version 30-LS0128\O from
committee with individual recommendations and attached fiscal
note(s).
4:45:30 PM
CHAIR DUNLEAVY announced that there being no objection, SB 21
moved from the Senate State Affairs Standing Committee. He asked
if there were any closing comments or questions.
SENATOR WILSON read a "Letter of Intent" from the Senate State
Affair Committee regarding SB 21 as follows:
It is the intent of the Senate State Affairs Committee
that when subsequent committees of referral in both
bodies of the Alaska Legislature consider Senate Bill
21 (Permanent Fund: Income; POMV, Dividends), or any
related legislation dealing with the use of the
earnings of the Permanent Fund, that those committees
strongly consider including the following elements.
1. Protection of the corpus of the Permanent Fund
against the erosive effect of inflation over
time.
2. A draw limit on the portion of earnings of the
Permanent Fund drawn for use by state government.
3. A savings rule which captures and saves at least
some peak revenue, and places these savings into
the corpus of the Permanent Fund.
CHAIR DUNLEAVY announced that the letter of intent will be
incorporated as the bill moves on to the next committee of
referral. He asked if committee members had any closing
comments.
SENATOR WILSON thanked Senator Stedman for putting forth SB 21.
He said the issues that SB 21 addresses are complicated. He
added that he appreciated the committee's time to address SB 21
and other bills related to the permanent fund. He opined that
hopefully the next committees will spend time diving deep down
into the issues that SB 21 addresses as well as listening to
Alaskans. He stated that he is a strong believer of the
government not having any more than what he has. He reiterated
that he appreciates Senator Stedman's efforts and others'
efforts put forth during the interim to work on the bill.
4:47:31 PM
CHAIR DUNLEAVY said he agreed with many of the sentiments that
Senator Stedman stated. He reiterated that the permanent fund
was constitutionalized decades ago because the people of Alaska
did not trust the Legislature. He hoped that the state was not
entering another period where Alaskans are going to question the
Legislature's motives.
He set forth that he looked forward to working with Senator
Stedman and others to ensure that the permanent fund is ring-
fenced to make sure the worst possible fears are not realized.
He added that he is going to keep pushing for the involvement of
Alaskans in the protection of the permanent fund because they
are partners in the process. He remarked that he was not sure
Alaskans were going to support a plan that they are not a part
of.
SENATOR GIESSEL addressed the letter of intent for SB 21 as
follows:
The letter of intent is very positive, and I think
really fits well with Senator Stedman's bill, SB 21;
he has used the title "Grow and Guard the Permanent
Fund" and I think we all agree with that.
The statement has been made, "The people of Alaska
entrusting to their elected officials," and I agree
with that, in fact I spoke about that on the Senate
floor. I believe that trust was eroded when the
governor vetoed 50 percent of the dividend in 2016;
this is a grave, serious decision that the elected
officials of this body should be making with the
deliberation we are going through right now.
I hope we can restore that trust through this
deliberation with public comment and the various
committees this bill will go through.
4:49:47 PM
CHAIR DUNLEAVY asked if there was a motion to move the letter of
intent regarding the items that Senator Wilson had put into
public record.
SENATOR GIESSEL moved that the letter of intent be attached to
SB 21 as it moves through the committee process.
4:50:12 PM
CHAIR DUNLEAVY found no objection, and SB 21, with the letter of
intent, was reported from the Senate State Affairs Standing
Committee.
4:50:18 PM
There being no further business to come before the committee,
Chair Dunleavy adjourned the Senate State Affairs Standing
Committee at 4:50 p.m.