05/08/2025 08:00 AM House COMMUNITY & REGIONAL AFFAIRS

              HB 126-REINSTATEMENT OF NATIVE CORPS                                                                          
                                                                                                                                
8:06:47 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  HIMSCHOOT announced  that the  first order  of business                                                               
would  be   HOUSE  BILL  NO.   126,  "An  Act  relating   to  the                                                               
reinstatement  of  Native  corporations;  and  providing  for  an                                                               
effective date."  [Before the committee was CSHB 126(TRB).]                                                                     
                                                                                                                                
8:07:03 AM                                                                                                                    
                                                                                                                                
PAUL  LABOLLE, Staff,  Representative Neal  Foster, Alaska  State                                                               
Legislature, presented CSHB 126(TRB)  on behalf of Representative                                                               
Foster,  prime sponsor.   He  paraphrased  the sponsor  statement                                                               
[included  in  the  committee  packet],  which  read  as  follows                                                               
[original punctuation provided]:                                                                                                
                                                                                                                                
     This  legislation  allows  an  involuntarily  dissolved                                                                    
     Native   Corporation   to   reinstate   as   the   same                                                                    
     corporation; thereby retaining its assets.                                                                                 
                                                                                                                                
     This  bill comes  up periodically  when a  local Native                                                                    
     corporation  fails to  submit  its  paperwork with  the                                                                    
     Division  of Commerce.  When any  corporation does  not                                                                    
     fulfill its reporting  requirements, the corporation is                                                                    
     involuntarily  dissolved.  In   normal  instances,  the                                                                    
     remedy  is a  new  corporation with  the  same name  is                                                                    
     formed. However,  the new corporation  is not  the same                                                                    
     as the old corporation and  does not retain its assets.                                                                    
     In normal instances, these  assets are easily dispersed                                                                    
     to the original shareholders.                                                                                              
                                                                                                                                
     For Native corporations, this not  the case. The assets                                                                    
     are comprised of lands granted  under the Alaska Native                                                                    
     Claims  Settlement  Act  (ANCSA).  Dividing  that  land                                                                    
     amongst the  shareholders would not be  consistent with                                                                    
     (ANCSA), which makes  land ownership collectively owned                                                                    
     by all the shareholders.                                                                                                   
                                                                                                                                
MR.  LABOLLE referred  to page  1, line  11, and  highlighted the                                                               
words "any time" as the substantive part of the bill.                                                                           
                                                                                                                                
8:10:00 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RUFFRIDGE referred to line  6 of CSHB 126(TRB) and                                                               
asked what would  happen after the two-year time  limit [from the                                                               
date of the certificate of involuntary dissolution].                                                                            
                                                                                                                                
MR. LABOLLE referred to the deleted  language on page 1, lines 9-                                                               
11, which was a drafting  decision by Legislative Legal Services.                                                               
He  explained  that  not  withstanding  the  2-year  cutoff,  the                                                               
involuntarily  dissolved Native  corporation could  be reinstated                                                               
at any time.                                                                                                                    
                                                                                                                                
8:11:58 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HALL  questioned  the circumstances  in  which  a                                                               
Native village corporation would have its status lapsed.                                                                        
                                                                                                                                
MR. LABOLLE  said it happens  for a myriad of  different reasons;                                                               
most commonly, someone moves, or someone passes away.                                                                           
                                                                                                                                
8:12:52 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   PRAX   asked   what  would   happen   with   the                                                               
corporation's assets after dissolution.                                                                                         
                                                                                                                                
MR.  LABOLLE  explained  that  normally,   the  assets  would  be                                                               
redistributed to the shareholders who  can reincorporate as a new                                                               
corporation  if they  so choose.   However,  with Native  village                                                               
corporations,  land assets  granted  under  Alaska Native  Claims                                                               
Settlement Act (ANCSA) are owned  collectively, not by individual                                                               
shareholders.  Furthermore, the  federal government hasn't always                                                               
conveyed all of the land that  the corporations own.  So, it gets                                                               
legally complex.                                                                                                                
                                                                                                                                
8:16:00 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HOLLAND characterized this  as a paperwork problem                                                               
and  expressed concern  about the  workflow process  that creates                                                               
the noncompliance,  which needs to be  part of the solution.   He                                                               
asked how  many entities are  being dissolved  and reincorporated                                                               
in a two-year timeframe.                                                                                                        
                                                                                                                                
CO-CHAIR  HIMSCHOOT  asked   whether  Representative  Holland  is                                                               
speaking to ANCSA village corporations or global corporations.                                                                  
                                                                                                                                
REPRESENTATIVE HOLLAND  said he's trying to  understand the scope                                                               
of the problem and how many entities this affects.                                                                              
                                                                                                                                
8:20:49 AM                                                                                                                    
                                                                                                                                
MR.  LABOLLE  anecdotally  reported  that there  were  19  Native                                                               
village corporations that had  been involuntary dissolved between                                                               
2010 and 2018.                                                                                                                  
                                                                                                                                
CO-CHAIR  HIMSCHOOT  asked  for   the  total  number  of  village                                                               
corporations in Alaska.                                                                                                         
                                                                                                                                
MR. LABOLLE estimated 250.                                                                                                      
                                                                                                                                
REPRESENTATIVE HOLLAND  asked of the  19, how many  lapsed beyond                                                               
the two-year period.                                                                                                            
                                                                                                                                
MR. LABOLLE did not know the answer.                                                                                            
                                                                                                                                
8:22:30 AM                                                                                                                    
                                                                                                                                
SYLVAN   ROBB,   Operations   Manager,  Division   of   Business,                                                               
Corporations  & Professional  Licensing, Department  of Commerce,                                                               
Community  & Economic  Development (DCCED),  answered that  in FY                                                               
24,  there  were  6,441  corporations  of  all  types  that  were                                                               
administratively   dissolved  and   604  that   were  reinstated;                                                               
however,  they   were  still  within  the   two-year  window  for                                                               
reinstatement.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  HOLLAND  asked  whether  there  is  a  means  for                                                               
tracking entities dissolved outside the two-year window.                                                                        
                                                                                                                                
MS.  ROBB  responded no,  there  is  no specific  information  on                                                               
village corporations.                                                                                                           
                                                                                                                                
REPRESENTATIVE HOLLAND asked for the  number of all entities that                                                               
lapsed and reincorporated outside the two-year window.                                                                          
                                                                                                                                
MS. ROBB  did not  know the  answer because it  would be  hard to                                                               
differentiate them from a newly formed corporation.                                                                             
                                                                                                                                
8:25:40 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HIMSCHOOT  questioned the distinction between  the needs                                                               
of  ANCSA corporations  and  other types  of  corporations.   She                                                               
shared her  understanding that  it's based on  the type  of asset                                                               
that the corporation distributes upon dissolution.                                                                              
                                                                                                                                
MS. ROBB answered  yes, there is a distinction, which  is why the                                                               
bill was brought forward.                                                                                                       
                                                                                                                                
CO-CHAIR  HIMSCHOOT   asked  what  happens  with   the  dissolved                                                               
corporations' assets under current law.                                                                                         
                                                                                                                                
MR. LABOLLE did not know the answer  and said he does not want to                                                               
find out.                                                                                                                       
                                                                                                                                
8:27:39 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX  asserted  that  the  dissolution  of  6,441                                                               
corporations in one year seems impossible.                                                                                      
                                                                                                                                
MS.  ROBB  pointed  out  that   there  is  in  excess  of  92,000                                                               
registered corporations in Alaska.                                                                                              
                                                                                                                                
CO-CHAIR HIMSCHOOT  asked whether  the limited  liability company                                                               
(LLC)  for her  rental property  would be  considered one  of the                                                               
[92,000] LLCs in Alaska.                                                                                                        
                                                                                                                                
MS.  ROBB said  yes, the  figure  is inclusive  of all  corporate                                                               
types.                                                                                                                          
                                                                                                                                
8:29:00 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX   asked  whether  the  problem   exists  for                                                               
nonprofit organizations (NPOs) as well.                                                                                         
                                                                                                                                
MS. ROBB  said that it  would be a policy  call.  She  added that                                                               
NPOs seem  to do a reasonable  job with paperwork, as  fewer than                                                               
400 were involuntarily dissolved in FY 24.                                                                                      
                                                                                                                                
8:31:12 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HOLLAND   asked  for  insight  on   why  this  is                                                               
happening  and  what  the  legislature  might  do  to  solve  the                                                               
problem.                                                                                                                        
                                                                                                                                
MS. ROBB  said part of  the issue  with corporate filings  is the                                                               
need to  review the filing.   She said it's hard  to decipher how                                                               
many  were dissolved  because they  had  no desire  to see  their                                                               
business  continue versus  businesses  that got  behind on  their                                                               
paperwork or were confused about the process.                                                                                   
                                                                                                                                
8:35:34 AM                                                                                                                    
                                                                                                                                
RICHARD BENDER, President & CEO,  Alaska Native Claims Settlement                                                               
Act  Village  Corporation,  gave  invited  testimony  during  the                                                               
hearing on  HB 126.   He  shared his experience  and said  in the                                                               
beginning, some  believed that  ANCSA corporations  were destined                                                               
to  fail   as  Native   leaders  were   expected  to   run  these                                                               
corporations when some  lacked the ability to  read, for example.                                                               
He  said his  peoples  are still  adapting  and developing  their                                                               
institutions,  education,  and culture.    He  opined that  these                                                               
ANCSA  corporations are  important to  the economic  wellbeing of                                                               
individuals and the community.                                                                                                  
                                                                                                                                
8:39:18 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   HOLLAND  asked   whether  the   bill  would   be                                                               
retroactive for currently involuntarily dissolved corporations.                                                                 
                                                                                                                                
MR. LABOLLE answered yes.                                                                                                       
                                                                                                                                
8:39:49 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HIMSCHOOT opened public testimony on CSHB 126(TRB).                                                                    
After  ascertaining that  no one  wished to  testify, she  closed                                                               
public testimony and announced that the bill would be held over.