Legislature(2025 - 2026)GRUENBERG 120
02/05/2026 03:15 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HCR9 | |
| HB124 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 124 | TELECONFERENCED | |
| += | HCR 9 | TELECONFERENCED | |
| += | HB 202 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 124-AIDEA
3:18:45 PM
CHAIR CARRICK announced that the final order of business was
HOUSE BILL NO. 124, "An Act relating to the Alaska Industrial
Development and Export Authority; and providing for an effective
date."
3:20:00 PM
REPRESENTATIVE STORY moved to adopt the proposed committee
substitute (CS) for HB 124, Version 34-LS0411\N, Walsh, 3/4/26,
as a working document.
CHAIR CARRICK, as prime sponsor, objected for the purpose of
discussion and asked her staff to walk through the changes.
3:20:30 PM
STUART RELAY, Staff, Representative Ashley Carrick, Alaska State
Legislature, on behalf of Representative Carrick, prime sponsor,
presented the summary of changes outlined in a document in the
committee files as follows [original punctuation provided]:
Section 1: Unchanged.
Section 2: Removes the board seat designated for
someone from an environmental advocacy organization.
Section 3: Unchanged.
Section 4: Unchanged.
Section 5: Unchanged.
Section 6: Unchanged.
Section 7: Unchanged.
Section 8: Increases the AIDEA Revolving Fund cap from
$500 million to $3 billion and provides an inflation
adjustment mechanism for the cap.
Section 9: Increases the threshold for project
approval from $10 million to $100 million and provides
an inflation adjustment mechanism for that threshold.
Also adds a requirement that an independent
feasibility study be completed for each project over
this threshold. The contractor for that study shall be
approved by the Legislative Budget and Audit
Committee.
Section 10: Unchanged.
Section 11: Further amends AS 44.88.205 to specify
that AIDEA is subject to the Executive Budget Act. It
does not make changes to the annual reporting
requirements that were in this section in Version A
Section 12: Unchanged
Section 13: Removes all language from section 13 in
version A and replaces it with new language relating
to public records. The new section 13 specifies that
the information in possession of AIDEA is a public
record. It further provides AIDEA the authority to
adopt regulations to designate and withhold from
public disclosure information that is privileged and
proprietary. That information includes personnel
records and proprietary information relating to
investment decisions.
Section 14: Unchanged.
Section 15: Unchanged.
Section 16: Unchanged.
Section 17: Unchanged
3:22:54 PM
CHAIR CARRICK commented that the changes in the proposed CS are
to find a better balance between public comments and the
executive director's information. This proposed bill provides
more latitude than the original version and has less
micromanaging of AIDEA.
3:24:58 PM
REPRESENTATIVE MCCABE asked why the bill sponsor used the Alaska
Railroad Corporation, which doesn't do loans for the public
record changes, instead of someone like the Alaska Housing
Finance Corporation that does do loans and deals with private
information.
CHAIR CARRICK replied that it was just a comparison tool. She
said she will look at the Alaska Housing Finance Corporation for
the public record requirement.
REPRESENTATIVE MCCABE asked if Mr. Davis could be asked if he
thinks these changes would be limiting to AIDEA or would be
better.
3:26:53 PM
MARK DAVIS, Special Counsel, Alaska Industrial Development and
Export Authority (AIDEA), said the limit change from $10 million
to $100 million was better, but still not good enough. He
provided an example of the hospital construction loan, and he
said AIDEA functions as a gap capital institution, and this bill
would not allow that to happen.
3:28:14 PM
REPRESENTATIVE HIMSCHOOT asked Mr. Davis whether there was a way
to maintain a certain amount of short-term capital for the
situation described while sticking within the confines of this
bill.
MR. DAVIS replied that putting AIDEA under the entire Executive
Budget Act would make decisions subject to appropriations.
Therefore, AIDEA wouldn't be able to move accounts under the
Act. He said AIDEA couldn't respond to business cycles and work
quickly as needed in 2008. He said with the structures in this
bill and the reporting requirements would not be possible.
REPRESENTATIVE HIMSCHOOT asked what some examples of projects
are that could be sustained with the $100 million that wouldn't
have been with $10 million.
MR. DAVIS replied that right now he doesn't have a full list of
projects, but he can send this information.
3:31:01 PM
REPRESENTATIVE HOLLAND asked about the pipeline of projects. He
noted that one option to explore is the use of Joint Legislative
Budget & Audit Committee to help with emergency situations.
This is a committee that has authority to act when the
legislature is not in session. He is curious about
capitalization and the $100 million. He thought at $49 million
that might have swept up other projects.
CHAIR CARRICK stated both the $3 billion and $100 million are
arbitrary numbers to provide enough headroom for AIDEA. She
noted Representative McCabe's points about a fire sale and
preventing that from happening in the future or ever. There are
no projects within $3 billion figure for AIDEA to invest in.
She agreed that projects around $50 million could be
controversial. Also, she would be open to the Joint Legislative
Budget & Audit Committee and not the entire legislature being
involved in more policy making consultations. Public testimony
requirements are unchanged in the committee substitute, to help
alleviate some of those concerns. The $100 million seemed to be
a more reasonable amount for legislative involvement.
REPRESENTATIVE HOLLAND liked the change in the Executive Budget
Act, to which AIDEA was always subject. He stated it provided
clarity, as it caught his attention.
CHAIR CARRICK replied that it was requested that way.
MR. RELAY provided examples of the types of loans AIDEA has
issued: Yukon Kuskokwim Health Corporation, $162 million;
Interior Gas Utility, $139 million; Chief Andrew Isaac Health
Center, $249 million; Cook Inlet Gas Development, $82 million;
Blue Crest Energy, $32 million; and HEX, LLC, $50 million.
3:38:49 PM
REPRESENTATIVE HIMSCHOOT asked if any of the projects were
approved under emergency situations.
MR. RELAY answered he didn't have that information.
3:39:14 PM
REPRESENTATIVE MCCABE asked if a new fiscal note would be
forthcoming for the CS.
MR. RELAY answered yes.
REPRESENTATIVE MCCABE suggested that the state holds all state
corporations under the Executive Budget Act. There is a reason
AIDEA is not under the Executive Budget Act, as well as the
Alaska Railroad.
3:40:36 PM
CHAIR CARRICK removed her objection to the motion to adopt the
proposed CS for HB 124, Version 34-LS0411\N, Walsh, 3/4/26, as a
working document. There being no further objection, Version N
was before the committee.
3:40:50 PM
REPRESENTATIVE ST. CLAIR noted, specific to Section 13, that a
lot of the public testimony had been remarks that there was a
lack of transparency. He commented that responding to questions
wasn't part of the legislative process either. He then asked
what the significance of Section 5 was.
MR. RELAY replied that it was conforming language relating to
the attorney general's approval. In response to a follow-up
question, he said it was not standard language.
REPRESENTATIVE ST. CLAIR referenced Representative McCabe's
point that if this proposed bill is doing this to AIDEA then it
should be done to the other corporations.
CHAIR CARRICK said she was open to other corporations and
parity. She explained that the proposed legislation was
specific to AIDEA and is in direct response to work being done
and the public desire to have transparency.
3:44:05 PM
REPRESENTATIVE ST. CLAIR asked for any specific instance of
AIDEA investment or a project that AIDEA was involved in that
was a bad decision. He said the desire for transparency he
understands.
CHAIR CARRICK said she did not bring up this legislation because
of a specific project. She is responding to constituents'
concerns. She said AIDEA has an opacity which is off-putting.
A lot of AIDEA decisions impact state decisions and have wide
ranges of impacts.
3:46:15 PM
REPRESENTATIVE MCCABE agreed that some AIDEA investments have
not panned out, because the legislature has gotten involved. He
said AIDEA is here to invest money in corporations. He said
killing AIDEA because of environmental issues is not right, and
he doesn't like this bill.
CHAIR CARRICK noted that Representative McCabe is more than
entitled to his opinion. She has stated her motivations and is
not here to prevent economic or resource development but to
respond to constituents' concerns. She wants the legislature to
make policy decisions related to the AIDEA projects.
REPRESENTATIVE MCCABE shared that once in front the Matanuska-
Susitna ("Mat-Su") Assembly, former Representative Sumner said
it is a mistake to shut down projects at this level, as there is
an environmental permitting process for public comment. He has
attended AIDEA meetings. Representative McCabe asked, "Why send
a message that Alaska is not open for business?"
3:50:45 PM
REPRESENTATIVE VANCE said that she has constituents that have
been feeling like there's no transparency, especially waiting to
provide public comment for hours. Her district is very pro-
resource development and building Alaska's economy. Regarding
Section 8, she asked why it is necessary to have a cap.
CHAIR CARRICK answered for two reasons: First, a cap sends a
message that the legislature will look at if the valuation gets
up to the cap. Second, on a broader scale, is the role that
AIDEA plays in economic development in the state. She sought
consideration of whether the legislature wants AIDEA to grow and
grow without limit, stating that AIDEA's investment decisions
are a measure of economic development overall. There are lots
of businesses doing economic development and a cap helps to
provide a little bit of sidebar on economic development.
REPRESENTATIVE VANCE noted in the same section that the amount
of unexpended and unobligated money would lapse into the general
fund (GF). This lapse could completely hamstring money for
economic development and would divert it from its purpose. She
asked if there was a reason for this.
CHAIR CARRICK replied that part of the reason is preventing the
fire sale discussion and AIDEA having to divest assets to get
under the cap. Under this language, AIDEA has an opportunity to
prepare for the future. There's a mechanism for capturing
excess funds and a protection mechanism for projects putting
them over the threshold.
3:56:20 PM
REPRESENTATIVE VANCE said applying realistic investment
decisions doesn't happen within a calendar year; many projects
take multiple years, like the LNG. In Section 9 project
oversight, the proposed bill wants the legislature to have
oversight. The last line of that section read: "obtain
legislative approval by law". The legislature is the power of
the purse. The legislature created the Board of Fisheries to
make decisions that involve lots of data and public engagement.
The legislature created AIDEA in a similar vein to make
investment decisions by people knowledgeable in that field. To
have this level of oversight would be a burden to the
legislature beyond what the legislature is mandated to do. She
questioned why, if there were so many projects, the legislature
would want everything to be approved by law. The parts of the
bill that create transparency and public process she can
support.
CHAIR CARRICK said she would be open to removing "by law" and
changing the language for legislative approval. As
Representative Holland pointed out, the committee substitute
would require an independent feasibility study by a contractor
approved by Legislative Budget and Audit. She feels that level
of oversight and communication is essential. She said all the
things on page 4 are important to have another entity looking at
it. The legislature needs to make a lot of wrap-around
decisions based on these larger projects. She said she is open
to feedback on how that would work.
REPRESENTATIVE VANCE said the size of project is determined by
the dollar amount. She asked how the sponsor concluded to use a
dollar amount versus geography.
CHAIR CARRICK replied that is why the committee substitute has
adjusted for inflation language. She would have to think about
[the pros and cons] of choosing a different metric. The dollar
amount is something that the legislature and public understand.
REPRESENTATIVE VANCE shared an example of inflation on a cup of
espresso. She stated there are lot of reservations about basing
policy on dollar amounts. She gave example of a project in Nome
and getting federal dollars. She questioned whether the
legislature needs to have direct oversight on projects. She
asked looking at it from a geographic standpoint, based on how
it will impact the communities. She mentioned larger projects
like LNG and explained that she is trying to determine how
decisions were made. She does not want to slow down AIDEA's
ability to drive economic development in the state. She
acknowledged that there is a public perception of secrecy, and
she observed that AIDEA has made positive changes and has
increased its engagement.
CHAIR CARRICK said she is open to additional conversation.
Version I to HB 124 is an attempt to reflect the testimony from
the public and AIDEA and start the conversation from a new
point.
4:09:52 PM
REPRESENTATIVE STORY said she appreciates the comments and
dialog. She knows her constituents and the state want to have
economic development. She said there is a history of
transparency that is not happening in various state
organizations and projects. She appreciates the intent in this
bill; there is transparency and due diligence. She appreciates
the changes in the board appointment transparency and terms.
She wanted to look at the legislature's policy on public comment
and that any written testimony gets posted. She said the intent
of this bill is to make sure that there is a confidence level in
the entity.
CHAIR CARRICK said she appreciated the discussion. This
legislation is an attempt to start a discussion next week.
Thursday's hearing will be limited to this bill and amendments.
She noted that comments on hamstringing AIDEA with this bill is
one interpretation. The bill will put sidebars on AIDEA.
Projects can still go forward with additional processes. This
bill doesn't say that AIDEA is useless. She said AIDEA has had
a cumulative economic effect of $55.5 billion in its 60 years of
existence. She commented that AIDEA plays a valuable role in
Alaska.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 124 Written Testimony Rec'd 2-4-26.pdf |
HSTA 2/5/2026 3:15:00 PM |
HB 124 |
| HB 124 FIscal Note DCCED-AIDEA-02-03-26.pdf |
HSTA 2/5/2026 3:15:00 PM |
HB 124 |
| HB 124 AIDEA Back-up 2.3.26.pdf |
HSTA 2/5/2026 3:15:00 PM |
HB 124 |
| HB 124 Ver. N.pdf |
HSTA 2/5/2026 3:15:00 PM |
HB 124 |
| HB 124 Summary of Changes Ver. A to Ver. N.pdf |
HSTA 2/5/2026 3:15:00 PM |
HB 124 |