Legislature(2021 - 2022)GRUENBERG 120
03/29/2022 03:00 PM House STATE AFFAIRS
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| Audio | Topic |
|---|---|
| Start | |
| HB142 | |
| HB271 | |
| HB251 | |
| HB203 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 142 | TELECONFERENCED | |
| += | HB 271 | TELECONFERENCED | |
| += | HB 251 | TELECONFERENCED | |
| *+ | HB 203 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
HB 271-AIDEA: MEMBERSHIP; RESPONSIBILITIES
3:46:31 PM
CHAIR KREISS-TOMKINS announced that the next order of business
would be HOUSE BILL NO. 271, "An Act relating to the Alaska
Industrial Development and Export Authority; and providing for
an effective date."
3:47:18 PM
REPRESENTATIVE ANDY JOSEPHSON, Alaska State Legislature, prime
sponsor of HB 271, clarified an incorrect statement he had made
in error during the last bill hearing. He said he had
erroneously believed that there were lawsuits pending from
former Alaska Industrial Development and Export Authority
(AIDEA) employees. He reported that although there was no
pending litigation, there was an investigation involving alleged
procurement decisions, verbal abuse, harassment, preferential
loans, loan forgiveness, etcetera. He claimed that if the
report he was referencing was correct, there were 18 people who
had left AIDEA in the last 22 months under less than favorable
circumstances.
3:49:42 PM
CHAIR KREISS-TOMKINS opened public testimony on HB 271.
3:50:35 PM
DAN CANNON stated his support for HB 271. He opined that AIDEA
was an institution that had not evolved with the times. Further
he characterized the immense economic power held by AIDEA as
troubling, as there was little oversight or public
accountability. He believed that the bill proposed necessary
initial steps to help build transparency and accountability.
3:51:50 PM
JOHN SONIN provided testimony unrelated to HB 271.
3:54:41 PM
GABRIEL KITTER, said he had been closely watching AIDEA's
involvement in the West Susitna Access Project, as he was a
property owner and avid user of the area. He believed that
AIDEA was unaffected by the shareholders' overwhelming
opposition to the project, adding that overall, the
institution's lack of public awareness and transparency to their
projects was frightening. He commented on the lack of public
outreach and characterized AIDEA as giving off a "mob-like
feeling." He believed that AIDEA had grown into a political arm
to overpower and overreach without public input for political
and financial gain. He opined that reform was long overdue.
3:57:30 PM
ARLEIGH HITCHCOCK opined that AIDEA was in desperate need of
reform, as the board was allowed to make decisions to spend
millions on projects that were bad for Alaskan communities and
strongly opposed by the members of those communities. They
commented on the lack of legislative oversight and sufficient
public input, as well as inaccessible meetings that were subject
to change at the last minute. They provided several examples.
They characterized AIDEA's outreach to Tribes and communities as
"horrible and disrespectful at best, and illegal at worst."
4:00:27 PM
ANNA GODDUHN stated her support for HB 271. She believed that
AIDEA needed public accountability to set priorities that were
in the best interest of Alaskans instead of mega projects that
served to enrich the few over the many.
4:01:26 PM
MARGI DASHEVSKY expressed her support for HB 271 and encouraged
the committee to strengthen the bill by adding amendments that
addressed the board's illegal use of executive session. She
highlighted AIDEA's record of violating the Open Meetings Act;
further, she pointed out that the recent changes made by the
institution in response to increased public scrutiny, such as
posting meeting times on the website, were superficial. She
shared several examples of AIDEA's misuse of executive session
and argued that that the average of 2-5 days of public notice
was not adequate for the public decisions of the magnitude in
political nature that they continued to make. She opined that
HB 271 was necessary to ensure that going forward, AIDEA played
to the historical strengths of the lender and focused on issuing
loans and bonds to small, locally owned businesses.
4:04:01 PM
REPRESENTATIVE TARR requested that the previous testifiers
follow up with written testimony that detailed their personal
experiences with ADIEA.
4:04:35 PM
MARGARET STERN stated her support for HB 271. She said she had
been closely watching AIDEA and the West Susitna Access Project
and was upset by how the institution had conducted itself. She
suggested that AIDEA had waisted state money, failed to reach
out to stakeholders, and disregarded public comment. She
highlighted her concerns specific to the West Susitna Access
Project. She reiterated her support for the bill to hold AIDEA
accountable to the Alaskan public.
4:06:02 PM
LOIS EPSTEIN, President, LNE Engineering and Policy, opined that
the same concerns the legislature had about the Alaska Permanent
Fund Corporation (APFC) Board of Trustees applied to the AIDEA
board, as board members were appointed by the governor and not
subject to legislative confirmation. She stated her
"unconditional" support for HB 271, specifically the provision
that increased analysis in legislative approval required for
AIDEA investments of over $10 million. She believed that the
provision would ensure that AIDEA was making financially sound,
rather than politically driven, investments.
4:08:40 PM
CHAIR KREISS-TOMKINS closed public testimony. He invited
questions from committee members.
4:09:18 PM
REPRESENTATIVE TARR asked whether the bill sponsor had
considered how to address the issues regarding public notice and
sporadic meeting time changes.
REPRESENTATIVE JOSEPHSON applauded her interest in that subject.
He noted that the bill would require AIDEA to conducts its
business through resolution rather than motion; further, the
bill would expand the notice requirement for amendment adoption
and regulation repeal to 30 days and considerably expanded the
opportunity for public testimony [on page 3 of HB 271].
REPRESENTATIVE TARR asked whether the bill clarified the
timeline for issuing public notice. She pointed out that people
take time out of their day to participate in public hearings,
which becomes difficult if the meeting times change
sporadically. She said she felt a responsibility to make the
process easier.
CHAIR KREISS-TOMKINS aligned himself with Representative Tarr's
comments.
4:12:13 PM
REPRESENTATIVE KAUFMAN directed attention to a supporting
document, titled "Additional Information Letter of
Clarification AIDEA" [included in the committee packet]. He
characterized the letter as a categorical rebuttal and asked
whether it could be addressed by the bill sponsor.
REPRESENTATIVE JOSEPHSON reviewed the letter from AIDEA.
REPRESENTATIVE KAUFMAN inquired about item 4 on page 2 of the
document, which addressed AIDEA's attention to local interests.
REPRESENTATIVE JOSEPHSON argued that the existing personnel
guidelines were insufficient. He believed that there should be
a provision in AIDEA's bylaws and state statute that outlined
personnel policy and the hiring of the executive director.
4:15:36 PM
REPRESENTATIVE KAUFMAN pointed out that item 5 on page 2 of the
letter contended that AIDEA was a political subdivision of the
Department of Commerce, Community & Economic Development (DCCED)
and had official personnel guidelines that followed the policy
established by the Department of Administration (DOA). He asked
whether the bill sponsor was asserting that there should be
additional personnel guidelines.
REPRESENTATIVE JOSEPHSON answered yes. He recalled receiving
feedback regarding the ongoing investigation, which suggested
that the standard for termination was arbitrary. He opined that
the existing statute was inadequate and less robust than other
agencies' [personnel policies].
REPRESENTATIVE KAUFMAN sought to confirm that Representative
Josephson believed that DCCED's [personnel policy] standards
were inadequate.
REPRESENTATIVE JOSEPHSON said he would have to delve into the
issue in more detail. He maintained that the turnover of 18
individuals based on a feeling of workplace harassment was
indicative of an agency that operated differently from other
agencies.
CHAIR KREISS-TOMKINS sought to confirm that AIDEA had 80
employees.
REPRESENTATIVE JOSEPHSON said approximately. He shared his
understanding that AIDEA was composed of 25-30 direct employees
with the addition of "other arms," such as the Alaska Energy
Authority (AEA).
CHAIR KREISS-TOMKINS asked, "If 18 is the numerator, what is the
denominator?"
REPRESENTATIVE JOSEPHSON answered 82.
REPRESENTATIVE KAUFMAN expressed his interest in hearing from an
AIDEA representative at the next bill hearing.
4:19:24 PM
REPRESENTATIVE EASTMAN directed attention to Section 9 of the
bill and asked why the threshold for oversight was set at $10
million. He opined that the $10 million figure seemed high.
REPRESENTATIVE JOSEPHSON said the intent was to avoid tying the
hands of the agency. He believed that the threshold of $10
million was adequate for functions such as lending; however, it
became problematic when AIDEA intervened in projects that were
opposed by many Alaskans. He conveyed that there was a sense of
"a lack of fair play" in terms of the way in which AIDEA
operated, which the bill aimed to reform.
REPRESENTATIVE EASTMAN turned to Section 10 of the bill, which
directed AIDEA to prioritize projects that furthered arctic
policy and energy policy. He asked which portion of the
authority's projects captured those two categories.
REPRESENTATIVE JOSEPHSON deferred to Ms. Sorum-Birk.
4:23:21 PM
ELISE SORUM-BIRK, Staff, Representative Andy Josephson, Alaska
State Legislature, on behalf of Representative Josephson, prime
sponsor, shared her understanding that AIDEA invested quite a
bit in the development of renewable and non-renewable energy
resources. She commented on areas in which AIDEA could improve
upon, such as positive investments in [indisc.] climates for
strategic infrastructure and safe and secure maritime transport.
REPRESENTATIVE EASTMAN asked what would happen to outstanding
projects that weren't prioritized under Section 10 and
therefore, didn't receive funding.
MS. SORUM-BIRK contended that AIDEA already used broad
discretion in choosing which projects to fund. She said section
10 was simply asking them to consider certain attributes when
funding projects overall.
CHAIR KREISS-TOMKINS announced that HB 271 was held over.