HB 166-MUSEUM CONSTRUCTION GRANT PROGRAM  8:04:05 AM CO-CHAIR FANSLER announced that the first order of business would be HOUSE BILL NO. 166, "An Act establishing a museum construction grant program in the Department of Commerce, Community, and Economic Development." 8:04:48 AM REPRESENTATIVE SADDLER asked whether the bill sponsor had determined how the State Library, Archives & Museum (SLAM) was funded. 8:05:05 AM LISA WORL, Staff, Representative Justin Parish, Alaska State Legislature, on behalf of Representative Parish, prime sponsor of HB 166, prefaced her response by noting that the SLAM would not be qualified to receive any benefit under HB 166, and she indicated that is because it is also a state library. She said the SLAM was funded through capital project funding, and she suggested that Patience Frederiksen, the director of Libraries, Archives and Museums, could offer more information. 8:06:00 AM CO-CHAIR PARISH, as prime sponsor of HB 166, questioned how germane the question was to the issue at hand. REPRESENTATIVE SADDLER explained he would like the information in order to establish what the current funding mechanism is before considering a new one. He then asked how much money, under HB 166, would be available to museums seeking state support to construct new facilities. CO-CHAIR PARISH answered that initially the amount would be zero, because the amount would be subject to future allocation. He added, "And I do not believe that the bill that Senator Stevens introduced and that I'm carrying on this side ... has dollar amounts in it." In response to Representative Saddler, he confirmed that HB 166 does not have an effect until the legislature appropriates money, and although he knows there are "a host of ... potential museums" that have put in requests, at present the capital budget is constrained and even a request for only 10 percent funding would likely be turned down. He clarified that under HB 166, 50/50 would be the minimum participation from local and non-profit sources, but if he were the Department of Commerce, Community & Economic Development (DCCED), he would favor those able to fund "a higher degree of outside participation." REPRESENTATIVE SADDLER asked what HB 166 would accomplish if it has no funding attached to it and its sponsor does not plan to amend the state budget to derive funding for it. CO-CHAIR PARISH answered that HB 166 "opens the door" and provides the option for communities to talk to their legislators to try to convince them that [their museum projects] should be priorities of the state. 8:10:07 AM REPRESENTATIVE SADDLER noted that the committee, at a previous hearing, had heard that HB 166 is modeled on a successful library grants program. He asked the sponsor if any information is available showing whether there have been grants issued through that program. CO-CHAIR PARISH answered yes. He pointed to a handout [included in the committee packet], which shows that 15 libraries, out of the 27 that applied, received grants under AS 37.05.315. 8:11:33 AM REPRESENTATIVE RAUSCHER asked for confirmation that under HB 166, applications for grants would sit in a queue, and it would be up to legislators to decide whether to sponsor a bill to support them. CO-CHAIR PARISH offered his understanding that it would be the prerogative of this or future legislatures to put money in the fund if a cultural institution were to surpass the 50 percent threshold for alternate sources of funding. He said there are a lot of cultural institutions concerned about education for children, tourism opportunities for visitors, the preservation of the state's history, and cultural enrichment that "will be making that argument in coming months and years." REPRESENTATIVE RAUSCHER asked for clarification that "there's not a pile of money that sits there waiting for the next project to come along." CO-CHAIR PARISH offered his understanding that that is correct; however, he said conceivably money could be allocated to the fund which would be insufficient to any given project or an insufficient amount could be left over after funding a project. He concluded, "I don't think this will ever become one of those funds that just sits there with a few millions dollars and a low interest rate." 8:14:25 AM REPRESENTATIVE SADDLER directed attention back to the handout to which Co-Chair Parish had pointed. He noted that from fiscal year 2011 (FY 11) and FY 16, zero library grants had been awarded under AS 14.56.355. CO-CHAIR PARISH said that is true; however, he said it is worth noting that the grants to municipalities - public library construction [under AS 37.05.315] has functioned in much the same way. He referred to the last part of sentence at the bottom of the handout, which read as follows [original punctuation provided]: It is the intent of the legislature that the following Grants to Municipalities (AS 37.05.315) satisfy the highest ranked public library construction projects identified by the Alaska Library Association and received by the Department of Commerce, Community, and Economic Development under the FY2012 Public Library Construction and Major Expansion Matching Grant program (AS 14.56.355). CO-CHAIR PARISH deferred to DCCED for further clarification. 8:17:47 AM KATHERINE ELDEMAR, Director, Division of Community and Regional Affairs (DCRA), Department of Commerce, Community & Economic Development (DCCED), in response to Representative Saddler, confirmed that there has never been funding under [AS 14.56.355]. REPRESENTATIVE SADDLER noted that mid-way down the same page, information read, "1 Awards under AK 14.56.355," and he asked for clarification about the number one. MS. ELDEMAR answered that is a misprint; it should read zero. 8:19:35 AM REPRESENTATIVE SADDLER asked Ms. Eldemar how the SLAM was funded. MS. ELDEMAR said the SLAM was a $37.5 million project, and she offered her understanding that it was funded through "the capital project." She explained that her division's computers have been "down" and she is trying to get that information to the committee. REPRESENTATIVE SADDLER asked if the following is a fair statement: The state paid much if not all the cost for the ... SLAM building. We are envisioning it creating a program under which the state would offer 50 percent of the funding for future museum construction elsewhere in the state, but there's no funding available to it at this point. MS. ELDEMAR said she believes that is an accurate statement, but said she could follow up with a written document for the record. 8:21:02 AM REPRESENTATIVE DRUMMOND related that SLAM was funded through the Department of Education and Early Development via the capital budget, Senate Bill 119, which passed in 2014. She confirmed the amount of the funding was $37.5 million, and she said it was for all the House districts, thus it was considered a statewide project. She offered her understanding that the funding may have begun in 2013, but said confirmation of that would require searching another capital budget. 8:22:21 AM REPRESENTATIVE RAUSCHER asked if money has ever "just sat in the library fund." MS. ELDEMAR said the DCRA does not have any funds in its account related to the library statute. In response to Representative Rauscher's question repeated, she stated, "No, in the history of this fund there's been no ... account just waiting there to be spent." 8:23:54 AM CO-CHAIR FANSLER ascertained that there was no one wishing to give public testimony; therefore, he [did not reopen public testimony, which was closed on 3/21/17]. 8:24:47 AM The committee took a brief at-ease at 8:25 a.m. 8:25:41 AM REPRESENTATIVE SADDLER directed attention to the previously discussed handout, to the flip side, the first heading of which he noted is titled "FY 11 Library Construction and Major Expansion Matching Grant Program." He asked if any of the projects on this side of the handout are considered museums. 8:26:18 AM CO-CHAIR PARISH said he believes all entities listed on the page are libraries, with the exception of [the Sealaska Heritage Institute's Walter Soboleff Building]. REPRESENTATIVE SADDLER asked if there is anything that prevents museums from obtaining state grants through the program set up under AS 37.05.315. MS. ELDEMAR answered, "There is nothing preventing the legislature from making a grant award under [AS] 37.05.315 absent this bill. If this bill were not passed, it could still go ahead and seek funding underneath AS 37.05." 8:27:52 AM REPRESENTATIVE WESTLAKE moved to report HB 166 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 166 was reported out of the House Community and Regional Affairs Standing Committee.