03/01/2024 01:00 PM House RESOURCES

          HB 222-PERMANENT FUND/AIDEA FUND INVESTMENTS                                                                      
                                                                                                                                
2:17:10 PM                                                                                                                    
                                                                                                                                
CHAIR MCKAY  announced that the  next order of business  would be                                                               
HOUSE  BILL NO.  222, "An  Act relating  to the  Alaska permanent                                                               
fund and the income and investments  of the fund; relating to the                                                               
permanent fund dividend; and providing for an effective date."                                                                  
                                                                                                                                
2:17:55 PM                                                                                                                    
                                                                                                                                
CODY   RICE,  Staff,   Alaska   House   Majority,  Alaska   State                                                               
Legislature,  on  behalf  of Representative  Sumner,  noted  that                                                               
using the Alaska Gasline  Development Corporation's (AGDC's) most                                                               
recent  assumptions on  interest rates  would reduce  the numbers                                                               
provided to  the committee during  the most recent  bill hearing.                                                               
He estimated  that equity  would be between  $800 million  and $1                                                               
billion, and the  debt service would fall  somewhere between $120                                                               
million and $230 million on an ongoing basis.                                                                                   
                                                                                                                                
CHAIR MCKAY sought questions from committee members.                                                                            
                                                                                                                                
2:19:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER recounted a  discussion on the House Floor                                                               
that  referenced an  argument  made by  a  former legislator  and                                                               
mayor  of  Anchorage,  Tom  Fink,   against  the  permanent  fund                                                               
dividend  (PFD).   In his  argument,  Mr. Fink  posited that  the                                                               
dividend   could  be   better  used   to  build   infrastructure;                                                               
nonetheless,  the dividend  was  established  without a  specific                                                               
investment purpose.   He shared  his understanding that  the bill                                                               
would "turn  that back" by  saying the PFD  should be a  means to                                                               
finance  big capital  infrastructure development.   He  asked how                                                               
Mr. Rice would reconcile that conflict.                                                                                         
                                                                                                                                
MR.  RICE  replied that  the  legislature  has the  authority  to                                                               
direct   [the  Alaska   Permanent  Fund   Corporation]  and   its                                                               
investments.                                                                                                                    
                                                                                                                                
2:20:34 PM                                                                                                                    
                                                                                                                                
CHAIR MCKAY sought to clarify whether  the bill would use part of                                                               
the PFD or the corpus.                                                                                                          
                                                                                                                                
MR. RICE  shared his  understanding that  its not  specific about                                                               
the location.                                                                                                                   
                                                                                                                                
REPRESENTATIVE MCCABE  directed attention to  page 1, line  2 and                                                               
read  the title  of  the bill,  "An Act  relating  to the  Alaska                                                               
permanent  fund  and the  income  and  investments of  the  fund;                                                               
relating to  the permanent  fund dividend;  and providing  for an                                                               
effective date."                                                                                                                
                                                                                                                                
MR. RICE confirmed  that there are two elements of  the bill, one                                                               
of which  affects the  PFD based  on a  recovery for  the initial                                                               
investment amount.                                                                                                              
                                                                                                                                
CHAIR MCKAY shared his understanding  that the bill would cap the                                                               
PFD at $1,000 with anything extra going towards the pipeline.                                                                   
                                                                                                                                
MR. RICE  agreed, citing page 1,  Section 2.  He  reiterated that                                                               
its  up   to  the  legislature   in  terms  of  how   the  equity                                                               
participation is funded.                                                                                                        
                                                                                                                                
CHAIR MCKAY  opined that the  financial discussion should  be had                                                               
by the House  Finance Committee.  As such, he  made the following                                                               
statement:                                                                                                                      
                                                                                                                                
     Our focus  as the [House Resources  Standing Committee]                                                                    
     is on resource  management policies and as  I don't see                                                                    
     any  objection  to  bringing our  natural  gas  to  the                                                                    
     market, I  recommend that we  allow the  [House Finance                                                                    
     Committee] to  address the financial  questions related                                                                    
     to this bill.                                                                                                              
                                                                                                                                
2:23:52 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease at 2:23 p.m.                                                                                 
                                                                                                                                
2:25:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAUSCHER  began a motion  but read the  wrong bill                                                               
number and  identifier information.   He subsequently  stated, "I                                                               
strike that motion."                                                                                                            
                                                                                                                                
2:26:08 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease at 2:26 p.m.                                                                                 
                                                                                                                                
2:26:36 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAUSCHER moved  to report HB 222  out of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes, and  to authorize Legislative  Legal Services to  make any                                                               
necessary technical or conforming changes.                                                                                      
                                                                                                                                
2:27:02 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MEARS objected.                                                                                                  
                                                                                                                                
2:27:44 PM                                                                                                                    
                                                                                                                                
A roll  call vote  was taken.   Representatives  Baker, Rauscher,                                                               
Armstrong, McCabe, and McKay voted in  favor of moving HB 222 out                                                               
of   committee.     Representatives  Mears   voted  against   it.                                                               
Therefore, HB 222 was reported  from the House Resources Standing                                                               
Committee by a vote of 5-1.