03/10/2010 09:00 AM Senate FINANCE

SENATE BILL NO. 269                                                                                                           
                                                                                                                                
     "An Act relating to the waiver of volume cap of                                                                            
     recovery zone economic development bonds authorized by                                                                     
     26 U.S.C. 1400U-2 and reallocation by the Alaska                                                                           
     Municipal Bond Bank Authority of the waived volume                                                                         
     cap; relating to the waiver of volume cap of recovery                                                                      
     zone facility bonds authorized by 26 U.S.C. 1400U-3                                                                        
     and reallocation by the Alaska Industrial Development                                                                      
     and Export Authority of the waived volume cap;                                                                             
     increasing the total amount of bonds and notes that                                                                        
     the Alaska Municipal Bond Bank Authority may have                                                                          
     outstanding; relating to revenue bonds issued by the                                                                       
     Alaska Municipal Bond Bank Authority; and providing                                                                        
     for an effective date."                                                                                                    
                                                                                                                                
9:05:21 AM                                                                                                                    
                                                                                                                                
Co-Chair   Stedman  stated   that  he   had  requested   the                                                                    
Department of Revenue to provide  a schedule for outstanding                                                                    
bonds and  for debt  service by community.  That information                                                                    
has been provided.                                                                                                              
                                                                                                                                
Co-Chair Hoffman MOVED to ADOPT a  new CS for SB 269 labeled                                                                    
26-GS2880\E, Cook, 3/8/2010.                                                                                                    
                                                                                                                                
Co-Chair Stedman OBJECTED for discussion purposes.                                                                              
                                                                                                                                
9:06:13 AM                                                                                                                    
                                                                                                                                
DARWIN  PETERSON, STAFF,  CO-CHAIR  BART STEDMAN,  explained                                                                    
the four changes in the bill.  The first change is a list of                                                                    
technical changes  that Legislative Legal made  in the first                                                                    
CS of  the governor's  bill. The second  change is  found on                                                                    
page 4, lines 14 and 15.  This change deletes the words "for                                                                    
equipment  for  building  improvements",  which  allows  the                                                                    
Municipal  Bond  Bank  to  partner  with  municipalities  to                                                                    
finance lease  purchase options  for any  lease, not  just a                                                                    
lease  for building  equipment  or  improvements. The  third                                                                    
change is in  the form of an amendment by  the Department of                                                                    
Revenue  found on  page  3, lines  9 -  14,  adding the  new                                                                    
subsection  (2), and  on  page 8,  lines 9  -  10, with  new                                                                    
Section  7.  The change  is  a  catchall amendment  for  any                                                                    
future  bond authority  that  comes to  the  state from  the                                                                    
federal government.                                                                                                             
                                                                                                                                
9:07:59 AM                                                                                                                    
                                                                                                                                
Mr. Peterson  described the fourth  change, which is  at the                                                                    
request of Senator  Thomas. It is found on page  4, line 25,                                                                    
beginning  with "unless  the borough"  and continuing  on to                                                                    
the subsection  at the end of  line 29. It is  also found on                                                                    
page  5,  line  28,  beginning   with  "if  a  borough"  and                                                                    
continuing  on to  page 6,  the end  of line  1. The  change                                                                    
continues on  page 6, line 16  and continuing on to  the end                                                                    
of the subsection  on line 20. It continues on  page 7, line                                                                    
17, to the end of the subsection on page 21.                                                                                    
                                                                                                                                
9:08:56 AM                                                                                                                    
                                                                                                                                
Senator  Thomas explained  that  the changes  would allow  a                                                                    
sixty-day extension for boroughs or  entities to make use of                                                                    
the  bonds  before AIDEA  takes  over.  Due to  the  federal                                                                    
government's misunderstanding  of Alaskan entities,  some of                                                                    
the  money  was  given  to  entities that  do  not  have  an                                                                    
opportunity to sell bonds.                                                                                                      
                                                                                                                                
9:11:07 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  requested  an explanation  of  the  other                                                                    
amendment. Mr.  Peterson related  that the  previous version                                                                    
of  the bill  would allow  for  the Municipal  Bond Bank  to                                                                    
enter into a relationship with  the municipality in order to                                                                    
lease  equipment  or  building  improvements,  but  did  not                                                                    
include  existing  buildings  or  land.  The  Department  of                                                                    
Revenue suggested the change in  order to enter into a lease                                                                    
purchase option with any municipality in the state.                                                                             
                                                                                                                                
Senator Thomas  added that the amendment  allows boroughs to                                                                    
cooperate  with  the Bond  Bank  and  AIDEA to  continue  to                                                                    
continue   development    activity   outside    of   borough                                                                    
jurisdiction.                                                                                                                   
                                                                                                                                
9:13:19 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman WITHDREW  his objection  to adopt  the new                                                                    
CS. There being NO further OBJECTION, it was so ordered.                                                                        
                                                                                                                                
DEVEN  MITCHELL, EXECUTIVE  DIRECTOR, ALASKA  MUNICIPAL BOND                                                                    
BANK  AUTHORITY,   DEPARTMENT  OF  REVENUE,   testified  via                                                                    
teleconference. He spoke in favor of the bill as amended.                                                                       
                                                                                                                                
Co-Chair  Stedman   noted  a  zero  fiscal   note  from  the                                                                    
Department of  Commerce, Community and  Economic Development                                                                    
and a fiscal note from the Department of Revenue.                                                                               
                                                                                                                                
9:15:01 AM                                                                                                                    
                                                                                                                                
Co-Chair  Hoffman MOVED  to  report CSSB  269  (FIN) out  of                                                                    
committee   with   individual    recommendations   and   the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
CSSB  269 (FIN)  was REPORTED  out of  committee with  a "do                                                                    
pass"  recommendation and  with zero  FN  1 (CED)  and FN  2                                                                    
(REV).                                                                                                                          
                                                                                                                                
AT-EASE        9:16:46 AM                                                                                                     
RECONVENED     9:17:11 AM