Legislature(2007 - 2008)BELTZ 211
02/22/2007 09:00 AM Senate STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB21 | |
| SB43 | |
| SB7 | |
| SB35 | |
| SB36 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 7 | TELECONFERENCED | |
| *+ | SB 35 | TELECONFERENCED | |
| += | SB 36 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | HB 21 | ||
| = | SB 43 | ||
SB 35-APPROP: FUNDS
CHAIR McGUIRE announced the consideration of SB 35.
10:11:04 AM
SENATOR GARY WILKEN, Alaska State Legislature, sponsor of SB 35,
said that during the last election he had to correct four people
who said the state spent everything last year. "Last year we
saved 46 percent of our surplus," which was $649 million, he
said. Some people knew it but characterized savings as spending,
and some simply didn't know it. He said there are "a couple of
billion dollars in surplus in 07 and 08, and so I wanted to get
out to the folks that we have places that we can put that." SB
35 is an appropriation fund, called "bank-a-billion" in
marketing terms. He said Alaska revenues will be record-high
from the new profit-based petroleum tax, but it will not be
known until March or later. SB 35 will save this expected
surplus of $1.35 billion into four separate savings accounts:
$250 million each to the Public Education Fund; Alaska Housing
Finance Corporation (AHFC) capital account; Permanent Fund
Earnings Reserve Account; and Constitutional Budget Reserve
Account. "The deposit of a billion dollars in four separate,
unique accounts forces the Legislature to save for the future, a
time when our state's financial picture might be different than
today."
10:14:25 AM
SENATOR FRENCH asked what the status is of the public education
fund and what the governor is planning for it.
SENATOR WILKEN said last year there was $565 million, "which we
used," and there is now $509 million. The governor proposes to
drain that to fund K-12. "The effect of that would be to use the
$509 million, but then you would not use your surplus so the
surplus, on June 30, would automatically…that particular $509
million would then drift into the [Constitutional Budget
Reserve]."
SENATOR FRENCH said if the legislature spent within its means
and kept the budget somewhere between the governor's and
legislature's budget, all this money would be swept into the CBR
at the end of the fiscal year.
SENATOR WILKEN said, yes. The bill would divert three fourths of
that to three separate accounts.
SENATOR FRENCH asked for the current AHFC capital account.
SENATOR WILKEN said $300 million was put in that account. He
noted that "we all thought, last year, that we had taken $300
million and put it into a capital account" in AHFC, but that is
not the case, because it is still in the general fund, "and
there's a fence around it." Lines 1-5 on page 2 of the bill are
incorrect, and he said he has an amendment to fix it. That money
is currently roped off in the general fund, so the bill will
move another $250 million to it.
SENATOR FRENCH asked if the amendment would move the funds out
of the general fund into the AHFC capital account itself.
SENATOR WILKEN said no, it matches the $250 million with the
$300 million that is in the general fund.
SENATOR FRENCH surmised it would still reside there with a fence
around it.
SENATOR WILKEN said he just found out about this yesterday. The
bill is written for money to go into the revolving fund, and
that isn't correct. "I don't think any of us knew that this
hadn't been moved over into Alaska Housing Finance fund." The
important point is that it is roped off, he stated.
SENATOR GREEN asked if an appropriation is generally made to the
AHFC capital account.
SENATOR WILKEN said, no, former Governor Murkowski wanted $400
million, "and so we took that and said, OK let's rope it off,
but if you don't need it, it could be used for something else."
10:18:36 AM
SENATOR FRENCH asked what currently is in the Permanent Fund
Earnings Reserve Account and the Constitutional Budget Reserve.
SENATOR WILKEN said the permanent fund had $4.5 billion in
realized earnings, and the Constitutional Budget Reserve had
$2.46 billion at the end of December.
10:19:06 AM
SENATOR GREEN made a motion to adopt Amendment 1, labeled 25-
LS0271\C.1, Kane, as follows:
Page 1, line 3:
Delete "housing finance revolving fund"
Insert "Housing Finance Corporation"
Page 2, lines 1 - 5:
Delete all material and insert:
"* Sec. 3. ALASKA HOUSING FINANCE CORPORATION. The
sum of $250,000,000 is appropriated to the Alaska
Housing Finance Corporation for the purpose of funding
capital projects, including financing expenses, from
the general fund available after all other
appropriations for the fiscal year ending June 30,
2007, are accounted for, but before the deposit
required under art. IX, sec. 17(d), Constitution of
the State of Alaska, is made. It is the intent of the
legislature that the Alaska Housing Finance
Corporation may transfer this money and the earnings
to a subsidiary of the Alaska Housing Finance
Corporation on or after July 1, 2007, under
AS 18.56.086."
CHAIR McGUIRE announced that without objection, Amendment 1
carried.
SENATOR GREEN asked why Senator Wilken used a dollar figure
instead of a percentage for the funds in the bill.
SENATOR WILKEN said the term, bank-a-billion is cute and it
works. He said the legislature should have a sense of how much
it wants to save. He said "all of us" worked on it last year,
and campaign time came "and we struggled to talk about savings."
He said "savings" was a four-letter word for many years, and the
state is blessed with surpluses, and savings is not spending, he
explained, "you spend it into a savings account."
SENATOR GREEN asked if the bill should say "at least" in case
the surplus is higher.
SENATOR WILKEN said that number will move around in finance
committee, "the point being, let's save something. Let's put it
in four places that we can access at a future time."
10:22:11 AM
CHAIR McGUIRE said she likes that there are four places because
everyone has ideas about where to save. She struggled to
convince her constituents that money was set aside last year.
This is a vehicle that the finance committee can deal with. She
said, "We don't know what the numbers will be or if they'll
change or even if those pots of money will be allocated slightly
differently, but…the finance committee would be a better resting
place for it…until those numbers come in."
SENATOR GREEN made a motion to report SB 35, as amended, from
committee with individual recommendations and attached fiscal
note(s). Hearing no objections, CSSB 35(STA) moved from
committee.
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