05/10/2018 09:30 AM Senate FINANCE

CS FOR HOUSE BILL NO. 331(FIN)                                                                                                
                                                                                                                                
     "An Act establishing the  Alaska Tax Credit Certificate                                                                    
     Bond Corporation; relating to  the issuance of bonds by                                                                    
     the  Alaska Tax  Credit  Certificate Bond  Corporation;                                                                    
     relating to  purchases of  tax credit  certificates and                                                                    
     refunds and  payments of tax  credits; relating  to the                                                                    
     oil  and gas  tax credit  fund; relating  to overriding                                                                    
     royalty   interest   agreements;   providing   for   an                                                                    
     effective  date  by  repealing the  effective  date  of                                                                    
     secs. 2, 5,  8, 10, 31, 37, and 40,  ch. 3, SSSLA 2017;                                                                    
     and providing for an effective date."                                                                                      
                                                                                                                                
9:47:25 AM                                                                                                                    
                                                                                                                                
Co-Chair MacKinnon informed that  the committee had heard HB
 on May  8, 2018; at which time the  committee reviewed a                                                                    
Sectional Analysis and presentation.  There had been invited                                                                    
testimony as well as public testimony.                                                                                          
                                                                                                                                
SHELDON   FISHER,  COMMISSIONER,   DEPARTMENT  OF   REVENUE,                                                                    
provided a  brief overview  of the bill.  He stated  that HB
 was intended to allow the  state to pay off the majority                                                                    
its obligations under  existing tax credits. It did  so in a                                                                    
cost-neutral way  by allowing  an option  for credit-holders                                                                    
to  take   a  discount.   The  discount  would   reduce  the                                                                    
obligation of  the state  and allow it  to bond  through the                                                                    
tax  credits;  with the  discount  paying  for interest.  He                                                                    
thought  the proposal  would be  cost-neutral  to the  state                                                                    
while paying  off tax credits  and allowing producers  to be                                                                    
able to raise capital and re-initiate projects.                                                                                 
                                                                                                                                
Senator Micciche  asked the commissioner to  discuss work he                                                                    
expected to move forward for  projects that were stalled. He                                                                    
referenced  business in  Kenai and  on the  North Slope.  He                                                                    
asked about revenue-positive aspects of the legislation.                                                                        
                                                                                                                                
Commissioner Fisher  informed that there  were approximately                                                                    
37 to  38 tax  credit holders;  most of  which had  seen the                                                                    
proposal as an  opportunity to raise capital  and deploy the                                                                    
capital to  promote projects and continue  work. He affirmed                                                                    
that  in addition  to  putting Alaskans  back  to work,  the                                                                    
proposal   would  also   accelerate   production  from   the                                                                    
properties.   The  state   would  benefit   through  getting                                                                    
additional royalties,  as well as production  tax associated                                                                    
with the properties. He viewed the  bill as a way to provide                                                                    
an acceleration of revenue to the state in future years.                                                                        
                                                                                                                                
Vice-Chair  Bishop  MOVED to  report  CSHB  331(FIN) out  of                                                                    
Committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSHB  331(FIN) was  REPORTED  out of  committee  with a  "do                                                                    
pass" recommendation and with  one previously published zero                                                                    
fiscal  note:  FN  1(DNR); and  three  previously  published                                                                    
fiscal impact  notes: FN 3(REV),  FN 4(REV), FN  5 (REV/Debt                                                                    
Service).                                                                                                                       
                                                                                                                                
9:51:20 AM                                                                                                                    
AT EASE                                                                                                                         
                                                                                                                                
9:53:16 AM                                                                                                                    
RECONVENED