Legislature(2009 - 2010)BARNES 124
03/17/2010 03:15 PM House LABOR & COMMERCE
| Audio | Topic |
|---|---|
| Start | |
| HB363 | |
| HB412 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 412 | TELECONFERENCED | |
| *+ | HB 363 | TELECONFERENCED | |
HB 363-AIDEA MEMBERSHIP
3:28:45 PM
CHAIR OLSON announced that the first order of business would be
HOUSE BILL NO. 363, "An Act relating to the membership of the
Alaska Industrial Development and Export Authority."
3:28:51 PM
ROB EARL, Staff, Representative Bob Herron, Alaska State
Legislature, explained that AIDEA's mission is to promote,
develop, and advance economic growth and diversification in
Alaska by providing various means of financing and investment.
He related that AIDEA fulfills this mission by providing Alaskan
businesses with long-term commercial and development financing
at a reasonable cost. He detailed that AIDEA is a public
development finance corporation independent of direct agency
control, although it is associated with Department of Commerce,
Community, & Economic Development (DCCED). A significant
percentage of the return on AIDEA's assets is redistributed as a
dividend and is deposited to the state General Fund (GF). He
noted that this year's dividend was $23 million.
MR. EARL related that currently, AIDEA consists of a five-member
board which includes the Commissioners of the Departments of
Revenue (DOR) and Department of Commerce, Community, & Economic
Development (DCCED), plus an additional department head
appointed by the governor, and two public members. This creates
a commissioner to private sector ratio of 3-2, which is the same
as the Alaska Energy Authority (AEA) board by statute. This
bill, HB 363, as written would restructure the board by
replacing two commissioners with two additional private sector
members. This would result in four private sector members and
the commissioner of DOR. The bill would require private sector
members to possess business expertise and leadership skills.
3:31:27 PM
REPRESENTATIVE HOLMES made a motion to adopt Amendment 1,
labeled 26-LS1503\A.1, Cook, 3/16/10, which read:
Page 1, lines 6 - 7:
Delete all material and insert:
"(1) the commissioner of revenue and the
commissioner of commerce, community, and economic
development; and"
Page 1, line 8:
Delete "four"
Insert "five"
Page 2, lines 1 - 2:
Delete all material and insert:
"(b) If a commissioner [MEMBER] described in
(a)(1) [OR (a)(2)] of this section is unable to attend
a meeting of the authority, the"
Page 2, line 13:
Delete "two"
Insert "three"
Page 2, line 17:
Delete "one member shall serve a two-year term"
Insert "two members shall serve two-year terms"
CHAIR OLSON objected for the purpose of discussion.
3:31:51 PM
ERIN HARRINGTON, Staff, Representative Alan Austerman, Alaska
State Legislature, provided some background on the interim work
on economic development that led to the introduction of this
bill. The research included information on other states'
successes on economic development efforts. One important
discovery was that these states attributed their success to
collaborative efforts by the private sector with government to
provide input on activities of state government as it related to
economic development. The informal group held ongoing
discussions and worked with Representatives Munoz and Herron to
integrate the private sector input into the bill.
3:33:45 PM
MR. EARL discussed Amendment 1. He explained the original bill
had removed the DCCED commissioner position from the board, but
discussions concluded it was important to keep the DCCED
commissioner on the proposed board due to the expertise he/she
can offer. Additionally, Amendment 1 would expand the board to
a seven-member board to allow subcommittees to be appointed and
for a broader pool of applicants for the governor to select
appointments.
CHAIR OLSON removed his objection. There being no further
objections, Amendment 1 was adopted.
3:35:07 PM
MR. EARL, in response to Representative T. Wilson, related that
he is open to regional representation.
REPRESENTATIVE T. WILSON asked whether private sector members
might have a conflict of interest issue.
MR. EARL answered that currently two public members serve on the
board. The board follows Roberts Rules of Order, which includes
provisions for addressing conflicts of interest.
3:36:18 PM
REPRESENTATIVE HOLMES recalled that the AIDEA board also serves
as the AEA board. She asked if the language that applies to the
public members is broad enough to encompass diversity, such as
AIDEA's interest in having someone serve that has an energy
background serve.
MR. EARL agreed the AIDEA board also serves as the AEA board.
He believed the language in HB 363 was broad enough to allow the
governor the discretion to address board member diversity. He
stated the sponsor is open to the idea of clarifying the energy
experience required of applicants.
3:37:21 PM
REPRESENTATIVE HOLMES assumed that would include people with
experience gained in energy cooperatives, or at the local
government level working with energy issues.
MR. EARL responded that it is not the sponsor's intent to
exclude persons with the experience mentioned.
3:38:07 PM
REPRESENTATIVE NEUMAN asked whether AEA and AIDEA boards are
joined.
MR. EARL answered that by statute the AIDEA and AEA boards are
the same board.
REPRESENTATIVE NEUMAN asked when reviewing projects, whether the
boards are involved in the discussion of projects such as the
renewable energy projects.
3:39:22 PM
TED LEONARD, Executive Director, Alaska Industrial Development &
Export Authority (AIDEA) and Alaska Energy Authority (AEA),
Department of Commerce, Community, & Economic Development
(DCCED), introduced himself.
3:39:53 PM
REPRESENTATIVE NEUMAN asked when considering the renewable
energy projects of up to $550 million, for the depth of
discussions that the AIDEA or AEA board membership holds and
whether specific projects are reviewed.
MR. LEONARD responded AIDEA has not been involved in the
analysis on AEA projects, but does consider its own contracts,
such as contracts pertaining to alternative energy programs. He
said he cannot really elaborate on the entire process that AEA
uses or when the AIDEA's board is also the AEA board. He
deferred to the Executive Director of the Alaska Energy
Authority to testify on that matter. He related that AIDEA can
be involved, as Mr. Earl mentioned, in the process of financing
energy projects. Currently, AIDEA is working to identify ways
to partner with AEA on projects. In fact, AIDEA and AEA's staff
are currently meeting with officials from the U.S. Department of
Energy to find ways to utilize the federal stimulus guarantee
programs to fund energy projects in the state.
3:41:56 PM
REPRESENTATIVE NEUMAN related Amendment 1 increased the private
sector members that serve on the AIDEA board, and asked whether
the expertise would include power generation experience or
different types of similar work. He further asked how conflicts
of interest would be resolved.
MR. EARL answered that under Amendment 1 there would be five
public members and two commissioners. He offered that the board
would follow Roberts Rules of Order and members would need to
declare a conflict of interest, and the board would vote on
whether a conflict exists. The expertise required for board
members would be left to the governor's discretion. No specific
requirement is specified in the bill to require an energy
expert, but he stated that he is open to the idea.
CHAIR OLSON pointed out that the appointment process would be
the same process as for other boards and commissions.
MR. EARL noted that AIDEA board members are not subject to
legislative approval.
3:43:41 PM
MR. LEONARD elaborated that the AIDEA board does have to follow
the Ethics Act. He affirmed that board members would be
required to identify a conflict of interest and with a larger
board he envisioned it would be easier to vote on those types of
issues. He suggested that the requirement for business
experience could be expanded to add "and industry experience."
He suggested that AIDEA, in working with the bill sponsor,
discussed the importance of having expertise from different
sectors including industry expertise, natural resource
extraction, logistics, energy, and communications. He pointed
out that industry could be added to provide legislative intent
that the qualifications of board members include a broader range
than what would normally be considered business expertise.
3:45:18 PM
CHAIR OLSON referred to page 1, lines 12 - 13, and suggested it
should read, "...has expertise in private sector business and
industry, and possess demonstrated leadership skills."
3:45:27 PM
REPRESENTATIVE HOLMES made a motion to adopt Conceptual
Amendment 2, on page 1, lines 12 - 13 after business, to insert
"and/or industry".
REPRESENTATIVE T. WILSON objected for purpose of discussion.
REPRESENTATIVE HOLMES offered her belief that this would
incorporate the language suggested by Mr. Leonard and would
ensure industry participation.
REPRESENTATIVE NEUMAN thought this language was an improvement.
REPRESENTATIVE T. WILSON removed her objection.
There being no further objection, Conceptual Amendment 2 was
adopted.
REPRESENTATIVE NEUMAN asked whether financial disclosures of
board members are required.
MR. EARL answered yes. Public financial disclosures are
required of board members.
3:47:10 PM
REPRESENTATIVE T. WILSON asked whether regional representation
should be considered. She did not want the pool to be too small
and asked whether regional representation should be required or
would happen naturally.
MR. EARL related it would be up to the governor, but did not
mind the additional direction.
3:48:05 PM
REPRESENTATIVE T. WILSON made a motion to adopt Conceptual
Amendment 3. She suggested regional membership should include
one rural member, one member from the Interior, and one member
from Southeast Alaska to provide better diversity on the board.
CHAIR OLSON suggested the committee could provide a letter of
intent, but offered his belief that it is already the intent of
AIDEA, the governor, and the co-sponsors to have regional
membership on the board. He noted the bill is co-sponsored by
members from Southcentral, Western Alaska, and Southeast Alaska.
REPRESENTATIVE T. WILSON said she thought regional
representation on the AIDEA board was important since energy
diversity exists in each of the communities.
REPRESENTATIVE T. WILSON offered to work with the bill sponsor
to develop language.
ERIN HARRINGTON, Staff, Representative Alan Austerman, Alaska
State Legislature, stated she has seen rural member defined as
someone representing a community of less than 2,500 people or
located off the road system. She was not certain how to
identify an Interior member.
REPRESENTATIVE T. WILSON withdrew Conceptual Amendment 3.
CHAIR OLSON related that language could still be developed to
address regional representation.
3:50:56 PM
REPRESENTATIVE BUCH expressed an interest in having the AIDEA
board include members representing a cross section of interests,
including small businesses and industry. Additionally, he
thought board member appointments should overlap to provide
continuity and consistency to the AIDEA board.
3:51:49 PM
REPRESENTATIVE NEUMAN referred to Section 1 and to the AIDEA
board composition. He thought legislative intent could be added
to provide regional representation on the board. In response to
Chair Olson, he offered his belief that the sponsors will be
willing to work with Representative T. Wilson on language and
said he did not wish to hold up the bill.
REPRESENTATIVE T. WILSON mentioned that there are five Judicial
Districts in Alaska, which may be a way to arrive at regional
representation.
3:53:42 PM
CHAIR OLSON, after first determining no one else wished to
testify, closed public testimony on HB 363 and announced that it
would be held over.