03/25/1993 01:00 PM House CRA

  HB 198: REGIONAL ECONOMIC ASSISTANCE GRANTS                                  
                                                                               
  Number 549                                                                   
                                                                               
  MR. LABOLLE testified on behalf of the sponsor,                              
  Representative Foster, and read the sponsor statement into                   
  the record.  (A copy of the sponsor statement may be found                   
  in the House Community and Regional Affairs Committee Room,                  
  Capitol Room 110, and after the adjournment of the second                    
  session of the 18th Alaska State Legislature, in the                         
  Legislative Reference Library.)  He added, "This legislation                 
  (HB 198) in essence, would do two things:  It would allow                    
  the Department of Commerce and Economic Development to                       
  develop guidelines that would change the match from a one to                 
  one, to what they feel is more appropriate for some of the                   
  rural ARDOR (Alaska Regional Development Organization)                       
  groups.  The second portion of this would allow the fund to                  
  make grants of up to $100,000 instead of the $50,000 that                    
  currently is stipulated in statute."                                         
                                                                               
  Number 573                                                                   
                                                                               
  CARL BERGER, DIRECTOR, LOWER KUSKOKWIM ECONOMIC DEVELOPMENT                  
  COUNCIL, BETHEL, testified via teleconference from Kotlik in                 
  support of HB 198.  He said, "At the present time we are                     
  receiving a $47,400 grant from the state...matched dollar                    
  for dollar.  It's difficult for us smaller programs, such as                 
  mine, to provide the necessary match in order to draw those                  
  funds.  This is the money that the state provides us to                      
  essentially operate on.  We have a one person staff which is                 
  me, and it allows a little bit of travel for me to get                       
  around the region to work with the communities that are in                   
  my district."                                                                
                                                                               
  Number 623                                                                   
                                                                               
  DONNA TOLLMAN, EXECUTIVE DIRECTOR, COPPER VALLEY ECONOMIC                    
  DEVELOPMENT COUNCIL, GLENNALLEN, testified in favor of HB
 saying, "Right now we are working with 38 different                      
  people with business plans to locate for them various types                  
  of loan programs and funding in order for them to start                      
  small businesses which create, ultimately, jobs in these                     
  rural areas...  What happens is that we spend a great deal                   
  of our time trying to keep our doors open to be able to                      
  provide these services.  We have no corporate sponsors here.                 
  It's very difficult for us to raise our matching funds."                     
                                                                               
  Number 652                                                                   
                                                                               
  REPRESENTATIVE BUNDE asked, "I'm wondering what the                          
  administrative overhead (is), how much money these actual                    
  grants get to the small businesses and what's the average                    
  longevity of these enterprises?"                                             
                                                                               
  CHRISTOPHER GATES, DIRECTOR, DIVISION OF ECONOMIC                            
  DEVELOPMENT, DEPARTMENT OF COMMERCE, testified providing                     
  information on HB 198.  "In terms of playing offense,                        
  actually creating jobs and activity so that the kids don't                   
  have to move out of the villages to find good jobs, we                       
  aren't doing that as well as we could.  I was the President                  
  of the Kenai Peninsula Borough ARDOR for a number of years                   
  and I can tell you that the effort and energy spent just                     
  finding match monies to survive leaves very little actual                    
  time and energy to do any good...a little bit of their time                  
  left over to actually hustle jobs and make deals work."                      
                                                                               
  REPRESENTATIVE BUNDE rephrased his question about                            
  administrative overhead.                                                     
                                                                               
  TAPE 93-18, SIDE B                                                           
  Number 000                                                                   
                                                                               
  MR. GATES gave a description of the tasks of the ARDOR Board                 
  of Directors and added, "We paid our own travel.  There's no                 
  per diem.  These are volunteer Boards of Directors."  He                     
  then gave examples of ARDOR successful businesses.                           
                                                                               
  Number 039                                                                   
                                                                               
  MS. TOLLMAN gave a description of the economic development                   
  of a theatrical production developed in her area.                            
                                                                               
  MR. GATES summarized, "The bill in front of you (HB 198)                     
  simply establishes an absolute small foundation of $50,000                   
  where at least they could keep the lights on and the doors                   
  open for one person.  We set up the increase of another                      
  $50,000 which might be available to these ARDORS depending                   
  upon grants and matching monies that they then receive.  We                  
  could have $100,000 into these ARDORS to provide just one                    
  contact for economic development...in those local areas."                    
                                                                               
  Number 087                                                                   
                                                                               
  REPRESENTATIVE DAVIES MOVED to PASS HB 198 out of committee                  
  with individual recommendations.  There were no objections,                  
  and the MOTION CARRIED.                                                      
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  CHAIRMAN OLBERG adjourned the meeting at 1:44 p.m.