Legislature(2023 - 2024)BARNES 124
05/08/2024 03:15 PM House LABOR & COMMERCE
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| Audio | Topic |
|---|---|
| Start | |
| HJR27 | |
| SB182 | |
| SB239 | |
| SB182 | |
| SB234 | |
| SB115 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 336 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | SB 182 | TELECONFERENCED | |
| + | SB 234 | TELECONFERENCED | |
| + | HJR 27 | TELECONFERENCED | |
| += | SB 115 | TELECONFERENCED | |
| += | SB 239 | TELECONFERENCED | |
SB 239-AIDEA WORKFORCE HOUSING DEVELOPMENT
3:49:36 PM
CHAIR SUMNER announced that the next order of business would be
SENATE BILL NO. 239, "An Act relating to the Alaska Industrial
Development and Export Authority; and relating to workforce
housing development projects."
3:49:53 PM
CHAIR SUMNER moved to adopt Amendment 1 to SB 239, labeled 33-
LS1072\S.6, Walsh, 5/6/24, which read:
Page 1, line 1, following "Authority;":
Insert "relating to state loans for oil and gas
development projects in the Cook Inlet sedimentary
basin;"
Page 1, following line 3:
Insert new bill sections to read:
"* Section. 1. AS 42.05.141 is amended by adding a
new subsection to read:
(g) The commission shall, as required under
AS 44.88.850(b), determine whether the sale price in a
gas sales agreement for gas produced through a project
partially or fully funded by a loan under AS 44.88.850
constitutes a just and reasonable immediate delivery
price for gas.
* Sec. 2. AS 44.25.020 is amended to read:
Sec. 44.25.020. Duties of department. The
Department of Revenue shall
(1) enforce the tax laws of the state;
(2) collect, account for, have custody of,
invest, and manage all state funds and all revenues of
the state except revenues incidental to a program of
licensing and regulation carried on by another state
department, funds managed and invested by the Alaska
Retirement Management Board, and as otherwise provided
by law;
(3) invest and manage the balance of the
power development fund in accordance with
AS 44.83.386;
(4) administer the surety bond program for
licensure as a fish processor or primary fish buyer;
(5) provide reasonable assistance to the
Alaska Industrial Development and Export Authority
under AS 44.88.850(c).
* Sec. 3. AS 44.37.020 is amended by adding a new
subsection to read:
(d) The Department of Natural Resources shall
provide reasonable assistance to the Alaska Industrial
Development and Export Authority under
AS 44.88.850(c)."
Page 1, line 4:
Delete "Section 1"
Insert "Sec. 4"
Renumber the following bill sections accordingly.
Page 5, following line 20:
Insert a new bill section to read:
"* Sec. 6. AS 44.88 is amended by adding new
sections to read:
Article 10A. Cook Inlet Reserve-Based Lending.
Sec. 44.88.850. Cook Inlet reserve-based lending
account. (a) The Cook Inlet reserve-based lending
account is established in the revolving fund. The
account consists of money or assets deposited into the
account by the authority and contributions from other
sources.
(b) The authority may use money in the account
to make one or more reserve-based loans to fund oil
and gas development projects the authority considers
necessary to increase oil and gas production from the
Cook Inlet sedimentary basin. The authority may, as a
term of the loan, accept an ownership share in the
project funded by the loan. If the authority accepts
an ownership share as a term of the loan, the
ownership share must be in the form of a carried
interest that does not obligate the authority to
contribute to the development costs of the project.
The authority may make a loan under this section only
(1) to a legal entity in compliance with
state and federal laws;
(2) if the loan applicant provides a
written waiver permitting the authority to access or
obtain copies of the loan applicant's confidential
records that are in possession of the Department of
Natural Resources or the Department of Revenue;
information provided to the authority under this
section shall be kept confidential by the authority
unless disclosure is authorized by the loan applicant
or borrower;
(3) if the authority obtains an independent
study performed by an experienced, qualified expert
that confirms the valuation of the loan security and
the capacity of the loan to support the oil and gas
development project and to cause or increase the
commercial production of oil or gas from the Cook
Inlet sedimentary basin;
(4) if the Regulatory Commission of Alaska
determines, under AS 42.05.141(g), that the sale price
in a gas sales agreement for gas produced through a
project partially or fully funded by a loan under this
section does not exceed a just and reasonable
immediate delivery price for gas;
(5) if the authority determines that the
sales price for oil and gas produced through a project
partially or fully funded by a loan under this section
is reasonable and in the best interests of residents
of the state.
(c) The authority may request assistance from
the Department of Revenue under AS 44.25.020(a)(5) or
the Department of Natural Resources under
AS 44.37.020(d) to execute this section.
(d) The authority may accept an overriding
royalty interest in a lease for which a loan has been
extended under (b) of this section if, as a term of
the loan, the overriding royalty interest is subject
to prior approval by the Department of Natural
Resources. The authority may only have the overriding
royalty interest transferred to the authority if the
borrower defaults.
Sec. 44.88.855. Cook Inlet oil and gas
development projects; report. (a) The authority shall
evaluate oil and gas development projects the
authority believes have reasonable potential to
increase oil and gas production from the Cook Inlet
sedimentary basin. Each year, the authority shall
prepare a report related to those oil and gas
development projects and shall, by the first day of
each regular session of the legislature, deliver the
report to the senate secretary and the chief clerk of
the house of representatives and notify the
legislature that the report is available. At the
request of a legislative committee, a representative
of the authority shall appear in that committee to
review the report. For each oil and gas development
project, the report must include
(1) a cost estimate for the project;
(2) the potential recoverable gas from the
project;
(3) the projected rate of return for the
project;
(4) if the authority recommends a reserve-
based loan for the project, the amount of funds
necessary for deposit into the Cook Inlet reserve-
based lending account to provide a loan for the
project and the recommended source of funds for the
deposit.
(b) Notwithstanding AS 44.88.215,
44.88.850(b)(2), or any other law, a borrower's
information shall be subject to the public reporting
requirements under this section. Each year, the
authority shall prepare a report related to Cook Inlet
reserve-based loans made under AS 44.88.850 and shall,
by the first day of each regular session of the
legislature, deliver the report to the senate
secretary and the chief clerk of the house of
representatives and notify the legislature that the
report is available. At the request of a legislative
committee, a representative of the authority shall
appear in that committee to review the report. The
report must
(1) identify each entity borrowing funds
under AS 44.88.850;
(2) list the amount borrowed by each
borrower and the date each loan was approved;
(3) include a summary of the terms of the
lending agreement with each borrower;
(4) summarize each project for which a loan
was made, including the status of the project and the
volume of oil and gas produced and expected to be
produced from the project;
(5) list the status of payments made on the
loan, including whether the loan is or ever was in
default."
Renumber the following bill sections accordingly.
Page 6, following line 24:
Insert a new bill section to read:
"* Sec. 9. AS 44.88.900 is amended by adding new
paragraphs to read:
(20) "oil and gas development project"
means a development project to produce proven oil or
gas reserves;
(21) "reserve-based loan" means a loan made against
and fully secured by an oil and gas field, proven
undeveloped or developed oil and gas reserves, or
other assets of the entity receiving the loan."
REPRESENTATIVE RUFFRIDGE objected for the purpose of discussion.
CHAIR SUMNER summarized Amendment 1, stating that it is
essentially the reserve-based lending language that had been
under discussion many times in other committees.
3:50:56 PM
REPRESENTATIVE CARRICK opined that Amendment 1, in substance,
seemed like a separate piece of legislation. She noted her
curiosity as to what other members of the committee thought.
3:51:18 PM
The committee took an at-ease from 3:51 p.m. to 3:52 p.m.
3:52:35 PM
REPRESENTATIVE FIELDS moved to adopt Conceptual Amendment 1 to
Amendment 1 to change "may" to "shall" on line 23, page 2, and
asked Legislative Legal Services to make conforming changes. He
confirmed that he supported the underlying amendment.
3:53:09 PM
REPRESENTATIVE PRAX objected and expounded on the proposed word
"shall".
REPRESENTATIVE FIELDS gave an example of "Cook Inlet
Investments" and the key being durability.
3:54:07 PM
TREVOR JEPSEN, Staff, Representative Tom McKay, Alaska State
Legislature, said the thinking behind "may" was to give the
Alaska Industrial Development and Export Authority (AIDEA) the
flexibility to take an ownership share but not require it.
3:54:39 PM
REPRESENTATIVE FIELDS asked Chair Sumner what his preference
was.
3:55:02 PM
BRANDON BREFCVYNSKI, Deputy Director, Alaska Industrial
Development and Expert Authority, remarked upon the rigidity of
requiring AIDEA to take an ownership stake. Having "may" gives
more negotiating room but "shall" limits the ability to finance
a project, he explained.
3:56:33 PM
REPRESENTATIVE PRAX spoke against the amendment and said that
taking an ownership share equals accepting a higher degree of
risk.
3:57:31 PM
CHAIR SUMNER confirmed his opposition [to Conceptual Amendment 1
to Amendment 1] and opined that it was too rigid.
3:57:44 PM
REPRESENTATIVE FIELDS [moved to withdraw] Conceptual Amendment 1
to Amendment 1. [There being no objection, it was so ordered.]
3:57:59 PM
REPRESENTATIVE RUFFRIDGE removed his objection [to Amendment 1].
There being no further objection, Amendment 1 was adopted.
3:58:26 PM
CHAIR SUMNER moved to adopt Amendment 2 to SB 239, as amended,
labeled 33-LS1072\S.2, Walsh, 5/7/24, which read:
Page 1, line 1:
Delete "and"
Page 1, line 2, following "projects":
Insert "; and authorizing the Alaska Industrial
Development and Export Authority to issue bonds to
finance infrastructure that supports development of
critical mineral, rare earth element, and energy
projects"
Page 6, following line 24:
Insert a new bill section to read:
"* Sec. 5. The uncodified law of the State of
Alaska is amended by adding a new section to read:
LEGISLATIVE APPROVAL: STATEWIDE CRITICAL MINERAL,
RARE EARTH ELEMENT, AND ENERGY INFRASTRUCTURE
PROJECTS. (a) The Alaska Industrial Development and
Export Authority may issue bonds to finance
infrastructure and construction costs of
infrastructure that support the development of
critical mineral, rare earth element, and energy
projects located in the state. The critical mineral,
rare earth element, and energy project infrastructure
shall be owned and operated by the authority or
financed under AS 44.88.172, 44.88.650 - 44.88.690, or
44.88.800 - 44.88.840. The principal amount of the
bonds provided by the authority for critical mineral,
rare earth element, and energy projects may not exceed
$300,000,000 and may include the costs of issuing
bonds considered reasonable and appropriate by the
authority. The bonds shall be repaid from revenues of
the authority.
(b) The Alaska Industrial Development and Export
Authority may issue the bonds under this section in a
single issuance or in several issuances, without
limitation as to the number of issuances or timing,
and as the authority determines best furthers the
purpose of financing infrastructure that supports the
development of critical mineral, rare earth element,
and energy projects in the state.
(c) The bonds authorized by this section may not
be considered in calculating the authority's bonding
limitation for a 12-month period under
AS 44.88.095(a).
(d) This section constitutes legislative approval
required by AS 44.88.095(g)."
REPRESENTATIVE RUFFRIDGE objected.
3:58:30 PM
The committee took an at-ease from 3:58 p.m. to 4:02 p.m.
4:02:15 PM
CHAIR SUMNER [moved to withdraw] Amendment 2 to SB 239, as
amended. There being no objection, it was so ordered.
4:02:21 PM
REPRESENTATIVE FIELDS moved to adopt Amendment 3 to SB 239, as
amended, labeled 33-LS1072\B.3, Walsh, 5/1/24, which read:
Page 2, lines 13 - 14:
Delete "containing five or more dwelling units"
Page 5, line 22:
Delete "containing five or more dwelling units"
Page 6, lines 26 - 27:
Delete "containing five or more dwelling units"
Page 6, line 29, through page 7, line 1:
Delete "that costs the occupants less than 30
percent of the income of a household with 120 percent
of the area median family income, as determined by the
United States Department of Housing and Urban
Development, for where the housing is constructed"
Insert "containing five or more dwelling units"
REPRESENTATIVE PRAX objected.
REPRESENTATIVE FIELDS said that he developed the amendment
because of his concern with the language on page 6, line 29. He
stated that if the amendment were adopted, the program would
support any multi-family workforce housing.
4:03:34 PM
REPRESENTATIVE PRAX asked whether there was a legal definition
of "workforce housing".
REPRESENTATIVE FIELDS answered that he was broadening the
definition to not be confined to low-income housing because it
captured only one segment of the workforce.
4:04:24 PM
JAMES HOLZENBERG, Staff, Senator Forrest Dunbar, Alaska State
Legislature, on behalf of Senator Dunbar, prime sponsor of SB
239, explained that the definition was intended to narrow the
scope of the bill. He added that the utility of the amendment
could benefit the legislation overall.
4:05:41 PM
MR. BREFCEYNSKI stated that he had no concerns with Amendment 3.
4:05:56 PM
REPRESENTATIVE PRAX maintained his objection.
4:06:22 PM
A roll call vote was taken. Representatives Fields, Ruffridge,
Wright, Carrick, and Sumner voted in favor of Amendment 3 to SB
239, as amended. Representatives Prax and Saddler voted against
it. Therefore, Amendment 3 was adopted by a vote of 5-2.
4:07:32 PM
REPRESENTATIVE RUFFRIDGE moved to report SB 239, as amended, out
of committee with individual recommendations and the
accompanying fiscal notes. There being no objection, HCS SB
239(L&C) was reported out of the House Labor and Commerce
Standing Committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 239 Amendment Packet.pdf |
HL&C 5/8/2024 3:15:00 PM |
SB 239 |
| S.pdf |
HL&C 5/8/2024 3:15:00 PM |
SB 239 |
| SB115 Amendment Packet 1.0.pdf |
HL&C 5/8/2024 3:15:00 PM |
SB 115 |
| SB115 Medical Profession Hours Comparison 5.8.2024.pdf |
HL&C 5/8/2024 3:15:00 PM |
SB 115 |