Legislature(2017 - 2018)SENATE FINANCE 532
04/10/2017 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB107 | |
| SB88 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 107 | TELECONFERENCED | |
| + | SB 88 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE BILL NO. 107
"An Act relating to the Alaska capital income fund."
9:02:47 AM
LAURA CRAMER, STAFF, SENATOR ANNA MACKINNON, stated that
the legislation changed the purpose of the Alaska capital
income fund. The legislation would change the fund to a
deferred maintenance fund.
Senator Dunleavy surmised that the legislation would create
a designated fund. Ms. Cramer replied that the funds would
not be required to be spent on deferred maintenance.
Senator Dunleavy understood that future legislatures could
determine how the funds were spent. Ms. Cramer agreed.
Co-Chair MacKinnon noted that the legislation was a Senate
Finance Committee bill. She stated that there was never a
designated a funding stream in the past. She stated that
the bill only had six lines and one section.
Senator von Imhof queried the process for determining which
projects received funding. She remarked that the Alaska
Capital Income Fund was created in 2006, and received an
annual deposit of earnings. She queried the amount of the
annual deposit, and the process for determining how those
funds were spent. Ms. Cramer replied that the annual
deposit was between $23 million and $26 million. She stated
that the total amount in the fund was $423 million. She
explained that deferred maintenance requests came from the
department agencies through Office of Management and Budget
(OMB), and were submitted in the governor's annual proposed
budget.
Senator Micciche queried the typical "spinoff" in revenue
from the fund. Co-Chair MacKinnon replied that it was
between $23 million to $26 million, depending on investment
returns.
9:07:04 AM
Vice-Chair Bishop stated that the fund was generated by the
Amerada Hess Settlement funds. Ms. Cramer agreed.
Vice-Chair Bishop stated that the interest generated in the
overview was from the Amerada Hess Settlement. Ms. Cramer
replied in the affirmative and explained that that the fund
was $422 million, and generated approximately $23 million
to $26 million annually.
Vice-Chair Bishop remarked that it was a simple concept. He
felt that the legislation was a way to save money.
Senator Dunleavy wondered whether the income stream would
replace any deferred maintenance money, or was it
supplemental. Ms. Cramer replied that she felt the fund
would add to the available funds.
9:10:09 AM
Senator Dunleavy felt that there should be a schedule about
how and when buildings were abandoned. He wanted a plan
with the legislation to determine how the fund was
utilized, because of the high number of deferred
maintenance fees.
Co-Chair MacKinnon stated that the bill did not add funds,
because the funds already exists. She stated that the funds
were already available. She explained that the outside
credit agencies would see that there was an investment in
deferred maintenance. She stressed that future legislatures
would be able to use the funds as they saw fit. She
remarked that every agency had their own system of
prioritization and selling their properties. Ms. Cramer
furthered that the legislation would provide a consistent
funding stream that was not currently available. She
remarked that OMB was working through a process with the
agencies to better prioritize deferred maintenance needs.
Senator Micciche felt that the fund did not provide more
money, but rather was the "first money" for deferred
maintenance.
9:15:00 AM
Senator von Imhof stated that the initial purpose of the
fund was for "any public purpose", and the purpose was
changed to "deferred and preventative maintenance." She
remarked that it was "okay" to create a guaranteed revenue
stream to incentivize deferred maintenance.
Senator Olson wondered whether there would be a change in
the prioritization of major maintenance. Ms. Cramer replied
that the legislation did not change the process that
deferred maintenance projects were submitted; it simply
provided a funding source.
Senator Olson remarked that there was an attempt to move
deferred maintenance to the capital budget. He wondered
whether there were other assets besides buildings or assets
that would be considered for maintenance that were not on
the list. Ms. Cramer replied in the negative.
Ms. Cramer addressed the zero fiscal note.
Co-Chair MacKinnon CLOSED public testimony.
Co-Chair MacKinnon stated that amendments were due by 5pm
the following day.
SB 107 was HEARD and HELD in committee for further
consideration.
9:19:40 AM
AT EASE
9:21:50 AM
RECONVENED
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 107 Sponsor Statement version A 04.05.2017.pdf |
SFIN 4/10/2017 9:00:00 AM |
SB 107 |