1997-03-12                     Senate Journal                      Page 0693
SB 133                                                                       
SENATE BILL NO. 133 BY THE SENATE RULES COMMITTEE                              
BY REQUEST OF THE GOVERNOR, entitled:                                          
                                                                               
An Act relating to a small business development                               
tax credit under the Alaska Net Income Tax Act;                                
and providing for an effective date.                                           
                                                                               
was read the first time and referred to the State Affairs and Finance          
Committees.                                                                    
                                                                               
Fiscal note published today from Department of Revenue.                        
                                                                               
Governors transmittal letter dated March 11:                                   
                                                                               
Dear President Miller:                                                         
                                                                               
                                                                               

1997-03-12                     Senate Journal                      Page 0694
SB 133                                                                       
The vast majority of Alaskas businesses can be defined as small                
but they play an enormous role in our states economy by providing              
more than 70 percent of private sector jobs and being the largest              
employers of minorities, women and youth.   Any effort to give a               
boost to business in Alaska must consider small businesses.                    
                                                                               
This bill, which is part of my Alaska Business Investment Incentive            
Plan, will encourage growth in small businesses by offering them tax           
credits for improving and expanding their operations.  The intent is           
to help level the competitive playing field between small businesses           
and larger corporations which enjoy economies of scale and                     
management, and ready access to investment capital at favorable                
interest rates.  Through this program, the state can assist small              
businesses in covering start-up costs, the purchase of new equipment,          
and the expansion of facilities--leading to jobs for Alaskans.                 
                                                                               
The Small Business Investment Tax Credit will benefit non-affiliated           
corporations, those with no brothers, sisters, parents or subsidiaries,        
with fewer than 50 employees.  The tax credit will be 10% of                   
capital investment up to $100,000, with a maximum annual credit of             
$10,000 and 50% of the businesss corporate income tax liability.               
To qualify, the investment must be for new property and the                    
corporation must be in good standing on unemployment insurance                 
and other state taxes.                                                         
                                                                               
This proposal will help small businesses--the lifeblood of Alaskas             
economy--to expand and thrive, thereby ensuring more Alaska private            
sector jobs and a healthy economy as we enter the next century.                
This is one goal we all can agree on and support.                              
                                                                               
						Sincerely,                                                               
						/s/                                                                      
						Tony Knowles                                                             
						Governor