CSHB 161(CRA): "An Act directing the Alaska Permanent Fund Corporation to transfer $22,700,000 from the principal of the mental health trust fund to the Alaska Mental Health Trust Authority; relating to the development of revenue-producing facilities on mental health trust land and to the Alaska Mental Health Trust Authority Subport Office Building; authorizing the issuance of certificates of participation for construction of the building; approving leases of all or part of the building by the Department of Administration; and providing for an effective date."
00 CS FOR HOUSE BILL NO. 161(CRA) 01 "An Act directing the Alaska Permanent Fund Corporation to transfer $22,700,000 02 from the principal of the mental health trust fund to the Alaska Mental Health Trust 03 Authority; relating to the development of revenue-producing facilities on mental health 04 trust land and to the Alaska Mental Health Trust Authority Subport Office Building; 05 authorizing the issuance of certificates of participation for construction of the building; 06 approving leases of all or part of the building by the Department of Administration; and 07 providing for an effective date." 08 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 09 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 10 to read: 11 LEGISLATIVE FINDINGS AND INTENT. (a) The legislature finds that the 12 (1) Alaska Mental Health Trust Authority intends to use up to $22,700,000 13 from the mental health trust fund (AS 37.14.031) in the construction of a new facility to be
01 known as the Alaska Mental Health Trust Authority Subport Office Building, to be located on 02 land held in trust by the authority in Juneau; and 03 (2) cost of constructing and equipping the new facility will be $45,400,000. 04 (b) The legislature intends that the state provide up to $22,700,000 from the issuance 05 of certificates of participation for the construction of the new facility and that the Department 06 of Administration lease all or part of the facility on its completion for use as office space for 07 state agencies under two separate leases, with the lease payments from one of them used to 08 pay the principal of and interest on the certificates of participation to the extent needed to 09 meet the debt obligation. 10 * Sec. 2. AS 37.14.009(a) is amended to read: 11 (a) The Alaska Mental Health Trust Authority 12 (1) has a fiduciary obligation to ensure that the assets of the trust are 13 managed consistent with the requirements of the Alaska Mental Health Enabling Act, 14 P.L. 84-830, 70 Stat. 709 (1956); 15 (2) shall contract with the Department of Natural Resources to manage 16 the land assets of the trust; the contract must provide for the recording of at least one 17 conveyance to the authority by quitclaim deed of mental health trust land in each 18 recording district in the state in which mental health trust land is located; a 19 conveyance to the authority is exempt from the platting and surveying requirements of 20 AS 38.04.045(b) and municipal ordinances adopted under AS 29.40; when the 21 Department of Natural Resources manages land assets of the trust under a contract 22 entered into under this paragraph, the department shall 23 (A) manage in conformity with AS 38.05.801; 24 (B) consult with the authority before adopting regulations 25 under AS 38.05.801(c); 26 (C) provide notice to, and consult with, the authority regarding 27 all proposed actions subject to public notice under AS 38.05.945 before giving 28 that public notice; 29 (D) annually provide the authority with a report including 30 (i) a description of all land management activities 31 undertaken under this section during the prior year;
01 (ii) an accounting of all income and proceeds generated 02 from mental health trust land; 03 (iii) an explanation of the manner in which the income 04 and proceeds were allocated between the mental health trust fund and 05 the mental health trust settlement income account; and 06 (E) obtain the approval of the authority before exchanging 07 mental health trust land under AS 38.05.801(b)(2); and 08 (3) except as provided in (c) of this section, shall contract with 09 Alaska Permanent Fund Corporation for management of the mental health trust fund. 10 * Sec. 3. AS 37.14.009 is amended by adding a new subsection to read: 11 (c) Notwithstanding AS 37.13.300(a), at the direction of the authority, the 12 Alaska Permanent Fund Corporation shall transfer money from the principal of the 13 mental health trust fund to a separate trust land development account. The total 14 amount transferred to the trust land development account may not exceed 15 $22,700,000. The authority shall use money in the trust land development account to 16 finance the development of revenue-producing office and retail buildings and 17 associated facilities on mental health trust land. The authority may use money in the 18 trust land development account for the development of facilities without regard to 19 maintaining reasonable diversification in investments. However, money may be used 20 for a proposed development project only if the authority determines that the proposed 21 development project has a risk level and expected return comparable to or greater than 22 alternative real estate investment opportunities. The authority shall 23 (1) exercise the powers of a fiduciary of a state fund granted in 24 AS 37.10.071 with respect to the management and investment of assets of the trust 25 land development account; and 26 (2) contract with the office established in the Department of Natural 27 Resources to manage the land assets of the Alaska mental health trust, as set out in 28 (a)(2) of this section, to serve as an external real estate investment manager to develop 29 real estate assets of the mental health trust fund. 30 * Sec. 4. AS 37.14.033 is amended to read: 31 Sec. 37.14.033. Management of trust fund. Except as provided in
01 AS 37.14.009(c), the [THE] mental health trust fund shall be managed by the Alaska 02 Permanent Fund Corporation under AS 37.13.300. 03 * Sec. 5. AS 37.14.035(a) is amended to read: 04 (a) Except as provided in AS 37.14.009(c), the [THE] cash principal of the 05 mental health trust fund shall be retained perpetually in the fund for investment by the 06 Alaska Permanent Fund Corporation, as specified in AS 37.13.300. 07 * Sec. 6. AS 37.14.035(b) is amended to read: 08 (b) The net income of the fund, including the net income of the separate 09 trust land development account, shall be transferred [BY THE CORPORATION] to 10 the mental health trust settlement income account at the end of each fiscal year. 11 * Sec. 7. The uncodified law of the State of Alaska is amended by adding a new section to 12 read: 13 FINANCING AND LEASE AGREEMENTS. (a) The state bond committee is 14 authorized to provide for the issuance of certificates of participation in one or more series in 15 the aggregate principal amount of up to $22,700,000 for the construction of a facility to be 16 known as the Alaska Mental Health Trust Authority Subport Office Building in Juneau if the 17 balance of the construction costs in the amount of up to $22,700,000 is made available by the 18 Alaska Mental Health Trust Authority from the trust land development account of the mental 19 health trust fund (AS 37.14.031). Interest income on the certificate of participation proceeds 20 may be used to pay arbitrage rebates, with the balance to be used for debt service during 21 construction or additional costs of construction and equipping the facility. The estimated total 22 cost of construction, acquisition, and equipping the facility is $45,400,000, including costs of 23 credit enhancement, underwriting, rating agency fees, bond counsel fees, financial advisor 24 fees, printing, and advertising. 25 (b) The state bond committee may contract for credit enhancement, underwriting, 26 credit ratings, bond counsel, financial advisors, printing, advertising, and trustee services that 27 the committee considers necessary in financing the acquisition and construction of the Alaska 28 Mental Health Trust Authority Subport Office Building. 29 (c) The Department of Administration is authorized to enter into a lease agreement 30 with the Alaska Mental Health Trust Authority with a term of 20 years for the use of all or 31 part of the Alaska Mental Health Trust Authority Subport Office Building by state agencies.
01 In addition to other funds that may be available for the purpose, as much of the lease 02 payments for the facility as are necessary to pay the principal of and interest on the 03 certificates of participation when due shall be used for that purpose. The estimated annual 04 amount of rental obligation under a lease agreement executed under this subsection is 05 $1,759,802. The estimated total amount of lease payments for the full term of the lease 06 agreement is $35,196,035. At the end of the term of the lease, ownership shall be vested in the 07 Alaska Mental Health Trust Authority. This subsection constitutes the approval required by 08 AS 36.30.080. 09 (d) The Department of Administration is authorized to enter into a lease agreement 10 with the Alaska Mental Health Trust Authority with a term of 30 years for the use of all or 11 part of the Alaska Mental Health Trust Authority Subport Office Building by state agencies. 12 The estimated annual amount of rental obligation under a lease agreement executed under this 13 subsection is $3,665,000. The estimated total amount of lease payments for the full term of 14 the lease agreement is $125,243,047. This subsection constitutes the approval required by 15 AS 36.30.080. 16 (e) The lease payments owed under a lease agreement executed under (c) of this 17 section and the lease payments owed under a lease agreement executed under (d) of this 18 section are subject to annual appropriation by the legislature. 19 (f) The Alaska Mental Health Trust Authority shall manage and operate the Alaska 20 Mental Health Trust Authority Subport Office Building. 21 * Sec. 8. This Act takes effect immediately under AS 01.10.070(c).