Legislature(2025 - 2026)BARNES 124
04/04/2025 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HB148 | |
| HB60 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | HB 148 | TELECONFERENCED | |
| += | HB 60 | TELECONFERENCED | |
HB 60-PROCURE PREF: AGRIC. & FISH PRODUCTS
[Contains discussion of HB 140.]
3:37:23 PM
CO-CHAIR HALL announced that the final order of business would
be HOUSE BILL NO. 60, "An Act relating to municipal and state
procurement preferences for agricultural products harvested in
the state and fisheries products harvested or processed in the
state; and providing for an effective date."
CO-CHAIR HALL noted that there would be a brief recap on the
proposed legislation and reminded committee members that the
house was also considering HB 140, a bill proposed to create a
Department of Agriculture.
3:38:10 PM
ANNA LATHAM, Deputy Commissioner, Department of Commerce,
Community & Economic Development (DCCED), answered questions on
behalf of House Rules, prime sponsor of HB 60 by request of the
governor. She stated that HB 60 would make incremental changes
to a Department of Administration (DOA) procurement statute that
has existed since 1986. She explained that state agencies,
municipalities, and school districts are currently required to
purchase Alaska-grown products or fisheries products harvested
in-state if they are available and within 7 percent of the cost
of out-of-state products. Additionally, she explained that
there is currently a permissible clause allowing state agencies,
municipalities, and school districts to purchase products that
are up to 15 percent higher than what is offered out-of-state.
MS. LATHAM further explained that HB 60 would increase the
requirement from 7 to 10 percent and would additionally change
the permissible amount from 15 to 25 percent.
3:39:19 PM
REPRESENTATIVE COULOMBE noted that the fiscal note is zero. She
asked whether this would increase costs for state agencies,
municipalities, and school districts even if there were no cost
to DOA.
MS. LATHAM replied that was correct if products grown in state
were more expensive. She noted that she has reached out to the
Department of Education and Early Development (DEED) and the
Alaska Municipal League (AML) regarding costs.
REPRESENTATIVE COULOMBE stated that she wanted to support
Alaska-grown products but asserted that there would be impacts
on local governments.
3:40:21 PM
REPRESENTATIVE CARRICK commented that she saw a survey of Alaska
saying that individuals are willing to pay $1.60 more on average
for Alaska-grown products. She opined that it was good for the
State of Alaska to take a position on Alaska-grown products.
She stated that she was largely in support of the proposed
legislation. She asked for clarification whether it was a
requirement or a choice to purchase Alaska-grown products that
fall within the threshold.
MS. LATHAM responded it would be a requirement for state
agencies, municipalities, and school districts if using DOA's
master contract with U.S. Foods. She noted that there are
currently very few items listed on the U.S. Foods contract. She
reminded committee members that HB 60 was introduced by
recommendation of the food security taskforce in order to
provide growers in state an entry to commercial markets so that
they might "ramp up their production."
3:42:46 PM
REPRESENTATIVE CARRICK asked whether there are products not
available at any cost she used lettuce growers as an example -
or whether there are not products available in state within the
current price differential.
MS. LATHAM replied that there is very little data on pricing in
Alaska, because there are so few products currently available.
She clarified that the intent of the proposed legislation was to
provide commercial entry to growers in state, who "can't
necessarily sell an additional five acres of potatoes unless
they know they have a buyer, and [HB 60] would provide a buyer."
She noted that the Department of Corrections (DOC) was the
largest purchaser of Alaska-grown products. She further noted
that the state purchases very little overall.
3:44:13 PM
REPRESENTATIVE SADDLER share concerns about the validity of a
zero fiscal note if the proposed legislation would mandate
entities to buy more expensive products, despite his support for
Alaska agriculture. He referred to the first four sections of
HB 60 and asked for a definition of "state money".
MS. LATHAM replied that those sections referred to
municipalities and school districts. She further stated that
all school districts and, to her knowledge, all municipalities
received state money.
REPRESENTATIVE SADDLER asked for clarification that the
provisions did not specify receiving state money to support
purchase of food; rather, it was for any purpose.
MS. LATHAM offered her belief that it was a broad definition but
deferred to DOA.
3:45:48 PM
BROOKE CASHEN, Deputy Chief Procurement Officer, Procurement and
Property Management, Department of Administration (DOA), offered
her belief that it referred to any agency that receives any
state funding. She noted that she would want to double check
with the Department of Law for a definitive answer.
3:46:21 PM
REPRESENTATIVE COULOMBE asked if the food bank would fall under
this requirement, offering her understanding that the food bank
received state money.
MS. CASHEN replied that she would have to check DOA's master
agreement, of which she did not believe the food bank was
compulsorily contracted. She additionally offered her belief
that the Department of Corrections (DOC) had the only mandatory
contract. In response to a follow-up question, she explained
that the master agreement from DOA contracted with U.S. Foods,
the vendor that provides the bulk of state food purchases,
Alaska-grown or not. She noted that it was only mandatory for
some agencies to use DOA's U.S. Foods contract and stated that
other agencies are able to procure from other sources. She
noted that [DOA's] data was sourced from U.S. Foods. She
additionally offered her belief that the proposed legislation
would apply to all state food purchases, not just agencies on
the master agreement.
3:48:12 PM
REPRESENTATIVE SADDLER asked if school districts are unable to
purchase foods in-state due to the 7-percent restriction.
MS. LATHAM responded that is not her understanding. She stated
there has not been a lot of produce or fisheries products
available. She noted that Alaska imports over 95 percent of its
food.
REPRESENTATIVE SADDLER commented that the 3 percent increase
would make it easier to buy Alaska products even if they cost
more.
3:49:25 PM
REPRESENTATIVE COULOMBE asked if there had been discussions
around availability of products and what would be done if
products were unavailable.
MS. LATHAM state that the U.S. Foods master contract has a lot
of out-of-state vendors currently on the list. She stated that
if HB 60 were to pass, then if a food product in-state were not
within the proposed 10 percent restriction, DOC, for example,
would purchase from an out-of-state vendor. She confirmed that
Representative Coulombe's understanding was correct. She
further noted that the majority of purchases are of out-of-state
goods.
3:50:50 PM
CO-CHAIR HALL asked how many growers were prepared to jump into
commercial markets.
MS. LATHAM responded that she did not have an exact number. She
noted that she met with the Farm Bureau recently and stated that
there were a handful of growers that indicated they could
expand. In response to a follow-up questions, she stated she
did not currently have information about a timeline.
3:51:51 PM
REPRESENTATIVE SADDLER commented that the state would need to
buy more freezers.
3:51:56 PM
CO-CHAIR HALL asked what additional support the agricultural
industry would need to sustain commercial markets under HB 60.
3:52:13 PM
REPRESENTATIVE COULOMBE said she felt that the effective date
was too short. She asked whether Ms. Latham would oppose an
extension on the effective date.
MS. LATHAM replied that there was no effective date. She
explained that, as more products become available, they will be
listed on the master contract.
3:53:02 PM
REPRESENTATIVE BURKE asked how many municipalities and school
districts use U.S. Foods.
MS. CASHEN stated she could get that data for the committee
members.
3:53:58 PM
REPRESENTATIVE SADDLER remarked that it was his understanding
that HB 60 was applicable to any agency that used state funding
and was not limited to agencies participating in the U.S. Foods
agreement.
CO-CHAIR HALL thanked the invited testifiers.
[HB 60 was held over.]
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB148 Additional Document - DOI Response to HLC 4.2.25.pdf |
HL&C 4/4/2025 3:15:00 PM HL&C 4/23/2025 9:00:00 AM |
HB 148 |