Legislature(2021 - 2022)BARNES 124

03/03/2022 08:00 AM House COMMUNITY & REGIONAL AFFAIRS

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 227 MUNI ENERGY IMPROVEMNT ASSESSMENT PROGRAM TELECONFERENCED
Moved HB 227 Out of Committee
+= SB 143 COMMON INTEREST COMMUNITIES; LIENS TELECONFERENCED
Heard & Held
-- Public Testimony --
*+ HB 309 APOC; CAMPAIGN CONTRIBUTIONS/REPORTING TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
**Streamed live on AKL.tv**
        HB 227-MUNI ENERGY IMPROVEMNT ASSESSMENT PROGRAM                                                                    
                                                                                                                                
8:32:03 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN announced  that the next order  of business would                                                               
be HOUSE BILL  NO. 227, "An Act relating to  municipal energy and                                                               
resilience improvement assessment programs;  and providing for an                                                               
effective date.                                                                                                                 
                                                                                                                                
8:32:31 AM                                                                                                                    
                                                                                                                                
CO-CHAIR SCHRAGE, as prime sponsor  of HB 227, reminded committee                                                               
members  that [the  resilience  improvement assessment  programs]                                                               
are  a new  financing mechanism  that has  spread throughout  the                                                               
U.S.   He noted that  HB 227  would expand the  property assessed                                                               
financing  mechanism set  in place  under House  Bill 80  [passed                                                               
during the  Thirtieth Alaska State  Legislature] and  loosen some                                                               
of   the  restrictions,   which  should   benefit  quite   a  few                                                               
communities with taxing authority.                                                                                              
                                                                                                                                
CO-CHAIR HANNAN noted that six  amendments had been submitted for                                                               
consideration.                                                                                                                  
                                                                                                                                
8:33:46 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY moved  to adopt  Amendment 1  to HB  227,                                                               
labeled 32-LS1028\I.3, Dunmire, 3/2/22, which read as follows:                                                                  
                                                                                                                                
     Page 1, line 1, following "programs":                                                                                    
     Insert "for commercial buildings"                                                                                        
                                                                                                                                
8:33:48 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN objected for the purpose of discussion.                                                                         
                                                                                                                                
8:34:20 AM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 8:34 a.m. to 8:36 a.m.                                                                       
                                                                                                                                
8:36:11 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY  spoke to Amendment 1,  explaining that it                                                               
would limit the provisions under HB 227 to commercial buildings.                                                                
                                                                                                                                
8:36:59 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE said  while he  appreciated  the intent  behind                                                               
Amendment 1, there are provisions of  HB 227 that "apply to other                                                               
projects than just  commercial buildings."  He  said changing the                                                               
title of the bill would make  it inconsistent with the content of                                                               
the  bill  and, thus,  constitutionally  invalid.   He  said  the                                                               
proper  way  to  address  the   issue  would  be  to  "amend  the                                                               
corresponding  sections  of  the   bill  that  would  need  those                                                               
changes."                                                                                                                       
                                                                                                                                
8:38:06 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCABE  agreed with  the  bill  sponsor that  the                                                               
corresponding  language   would  need  to  be   changed,  and  he                                                               
concurred  with  Representative  McCarty regarding  the  need  to                                                               
limit the bill  to commercial buildings.  He  questioned how wide                                                               
open the bill would be.                                                                                                         
                                                                                                                                
CO-CHAIR SCHRAGE deferred to his staff.                                                                                         
                                                                                                                                
8:39:14 AM                                                                                                                    
                                                                                                                                
RYAN  JOHNSTON,  Staff,  Representative  Calvin  Schrage,  Alaska                                                               
State  Legislature, on  behalf of  Representative Schrage,  prime                                                               
sponsor of HB 227, pointed out  where in statute the provision is                                                               
limited  to  industrial  and  commercial  properties  only:    AS                                                               
29.55.100(a)(1), which read as follows:                                                                                         
                                                                                                                                
           (a) A municipality may establish an energy                                                                           
      improvement assessment program under AS 29.55.100 -                                                                       
     29.55.165 to  finance the installation  or modification                                                                    
     of permanent improvements that are                                                                                         
          (1) fixed  to existing privately  owned commercial                                                                    
     or industrial property; and                                                                                                
                                                                                                                                
REPRESENTATIVE  MCCABE concluded  that  Amendment  1 would  "more                                                               
conform" the proposed legislation to statute.                                                                                   
                                                                                                                                
CHAIR  SCHRAGE responded  no.   He offered  his understanding  as                                                               
follows:                                                                                                                        
                                                                                                                                
     The  issue is  that  the  amendment specifically  deals                                                                    
     with sections  that also apply  to other  statutes; ...                                                                    
     however, this  C-PACE program is  limited --  there's a                                                                    
     reason  it's  called   C-PACE:    "Commercial  Property                                                                    
     Assessed Clean  Energy" is what  it was called.   We're                                                                    
     talking  more  of the  first  three  letters here,  but                                                                    
     again,  it's restricted  just to  those commercial  and                                                                    
     industrial properties.                                                                                                     
                                                                                                                                
8:40:34 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND remarked  on  the  restrictions in  what                                                               
could  be  commercial,  such as  between  an  apartment  building                                                               
versus a condominium.                                                                                                           
                                                                                                                                
CO-CHAIR  SCHRAGE  said  he thinks  Representative  Drummond  was                                                               
correct that it would be "restricted in that way."                                                                              
                                                                                                                                
REPRESENTATIVE  DRUMMOND asked  whether there  is a  program that                                                               
would  apply  to  a  condominium   project  that  is  similar  in                                                               
structure to  a mixed-use development but  wherein the apartments                                                               
are separately owned.                                                                                                           
                                                                                                                                
CO-CHAIR  SCHRAGE offered  his understanding  that  there is  not                                                               
such  a  program currently.    He  said  there has  been  initial                                                               
restriction  to   those  structures   "that  we  have   the  most                                                               
confidence in," but  other states have expanded  beyond that, and                                                               
that is something that Alaska could consider in the future.                                                                     
                                                                                                                                
8:42:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PATKOTAK  directed attention  to language  on page                                                               
3, in  Section 5, subsection  (a), [paragraphs] (1) and  (2), and                                                               
said he thinks  "that's where you start to see  the scope broaden                                                               
beyond  commercial  and industrial  property."    He offered  his                                                               
understanding  that  by  removing [paragraph]  (2)  and  allowing                                                               
Legislative Legal  Services to  make conforming  changes, "that's                                                               
how the title would change."                                                                                                    
                                                                                                                                
8:43:36 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE pointed  to language  on page  3, beginning  on                                                               
line [13],  which read: "new  construction or  existing privately                                                           
owned commercial  or industrial  property [;]  and that",  and he                                                           
explained  that [paragraphs]  (1) and  (2) ensue.   He  clarified                                                               
that [paragraph]  (2) expands  the types  of projects  that would                                                               
qualify for  this financing mechanism,  but the projects  have to                                                               
be for a commercial or industrial property.                                                                                     
                                                                                                                                
REPRESENTATIVE  PATKOTAK  noted  that  the  last  sentence  of  a                                                               
memorandum  from  Legislative  Legal Services  [included  in  the                                                               
committee  packet] read,  "The scope  of [AS]29.55.100(a)  is not                                                               
clearly limited to commercial buildings."                                                                                       
                                                                                                                                
8:44:45 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  HANNAN asked  for confirmation  that  [Amendment 1]  is                                                               
specifying the  actual physical building,  not the  property that                                                               
surrounds it.                                                                                                                   
                                                                                                                                
REPRESENTATIVE MCCARTY answered that's correct.                                                                                 
                                                                                                                                
8:45:29 AM                                                                                                                    
                                                                                                                                
MR. JOHNSTON  noted that changing  the bill title as  proposed in                                                               
Amendment  1 would  "nullify the  industrial side  of the  bill."                                                               
Regarding the intent  to address structures only,  he pointed out                                                               
that  commercial   construction  would  be  on   land  zoned  for                                                               
commercial  or industrial  use.   He said,  "So, that  would also                                                               
conflict with  the intent of  the bill to allow  new construction                                                               
to be utilizing C-PACE programs."                                                                                               
                                                                                                                                
[AN UNIDENTIFIED SPEAKER] said, "Correct."                                                                                      
                                                                                                                                
8:46:38 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCABE said he still "sees  this as an issue."  He                                                               
opined that  "it still  needs to  be focused  on buildings."   He                                                               
said, "If  you're going to  construct a new building,  this would                                                               
apply,  because  it's  in  here;  it  says  construction  of  new                                                               
buildings."   He expressed concern regarding  "the green agenda,"                                                               
and continued as follows:                                                                                                       
                                                                                                                                
     I  could have  a[n]  industrial  or commercially  zoned                                                                    
     property  on the  corner  of 20th  and  Muldoon, and  I                                                                    
     could put in a charging  farm with nothing but charging                                                                    
     stations  under this  bill, get  a  huge tax  financing                                                                    
     break, and make  a pile of money on  the commuters that                                                                    
     are leaving Anchorage that forgot  to charge their cars                                                                    
     on the way out.                                                                                                            
                                                                                                                                
REPRESENTATIVE MCCABE said  he does not think that  is the intent                                                               
of  HB  227;  the  intent  is  to  provide  resilience  following                                                               
earthquakes,  floods,   and  high   winds,  so   that  commercial                                                               
buildings  can  continue  to  operate  quickly.    Resiliency  is                                                               
tightly defined  and is not  needed for  a piece of  property, he                                                               
posited.                                                                                                                        
                                                                                                                                
8:48:02 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE  said  Representative  McCabe  brought  forward                                                               
valid concerns.   He then clarified how the  bill "might actually                                                               
work in application."   He talked about a co-housing  unit in his                                                               
district.  He mentioned solar panels  that could be put up in the                                                               
parking area,  not on  the building  itself.   Then he  said [the                                                               
proposed  legislation]  is not  offering  a  financial break  but                                                               
rather a  financial mechanism  that allows  the obligation  to be                                                               
placed on  the property  instead of  the individual  owner, which                                                               
allows for  a more secure  line of  credit with longer  terms and                                                               
lower interest rates.  He specified  there is no subsidy from the                                                               
government.  Finally, he said  whether or not [committee members]                                                               
think  [the  bill] should  be  limited  to commercial  buildings,                                                               
Amendment 1 does not limit the  bill "in any way whatsoever."  He                                                               
reiterated  that there  is  a way  to make  changes  to the  bill                                                               
itself, but "this amendment is not that."                                                                                       
                                                                                                                                
8:50:04 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND said  she  could see  many places  where                                                               
"storm water  management, for example,  would be smart  to manage                                                               
for the  building that you  own on that  property."  She  gave an                                                               
example.  She  concluded that she does not see  "why it should be                                                               
limited only to the building."                                                                                                  
                                                                                                                                
8:51:11 AM                                                                                                                    
                                                                                                                                
A roll call  vote was taken.  Representatives  McCarty and McCabe                                                               
voted  in  favor of  Amendment  1  to  HB 227.    Representatives                                                               
Drummond, Patkotak,  Prax, Schrage, and Hannan  voted against it.                                                               
Therefore, Amendment failed by a vote of 2-5.                                                                                   
                                                                                                                                
8:52:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY moved  to adopt  Amendment 2  to HB  227,                                                               
labeled 32-LS1028\I.4, Dunmire, 3/2/22, which read as follows:                                                                  
                                                                                                                                
     Page 6, lines 22 - 25:                                                                                                     
          Delete all material.                                                                                                  
                                                                                                                                
     Renumber the following bill sections accordingly.                                                                          
                                                                                                                                
8:52:12 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN and REPRESENTATIVE DRUMMOND objected.                                                                           
                                                                                                                                
8:53:26 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE compared  this  to refinancing,  as this  would                                                               
provide  a  financing  mechanism  that  is  a  great  benefit  to                                                               
commercial and industrial property owners.   He said, "Instead of                                                               
exchanging a mortgage for a  mortgage, they would be exchanging a                                                               
mortgage for a  property."  He said this could  "free up capital"                                                               
that then could be invested in the community.                                                                                   
                                                                                                                                
REPRESENTATIVE MCCABE asked whether those  people who have had to                                                               
remodel  their  businesses  but   did  not  do  any  "resiliency"                                                               
projects would get nothing from this.                                                                                           
                                                                                                                                
CO-CHAIR SCHRAGE  gave the  example of a  property owner  who has                                                               
made improvements  for a drainage  issue and, under  the proposed                                                               
legislation, rather  than take on  the debt alone,  could "attach                                                               
that lien  to the property."   That  could increase the  value of                                                               
the property.                                                                                                                   
                                                                                                                                
REPRESENTATIVE  MCCABE asked  about the  limit of  two years  for                                                               
retroactivity.                                                                                                                  
                                                                                                                                
CO-CHAIR  SCHRAGE responded  that he  would support  an amendment                                                               
extending that period.                                                                                                          
                                                                                                                                
8:57:23 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY spoke  about  someone getting  a loan  to                                                               
purchase property  and then flipping  the debt on the  new owner.                                                               
He   said  beyond   helping  with   energy   and  resiliency   in                                                               
construction, there would  also be the ability for  owners to use                                                               
the funding for other purposes, which he said raises a red flag.                                                                
                                                                                                                                
CO-CHAIR SCHRAGE  described a hypothetical situation  in which he                                                               
bought property  for $50,000 and then  sold it for $100,000.   If                                                               
he  used the  property lien  assessment,  then when  he sold  the                                                               
property, he would  sell it for $50,000, because  the buyer would                                                               
recognize   that  the   property  was   encumbered  by   $50,000;                                                               
therefore, it  would not be  worth $100,000.  He  clarified, "All                                                               
of  this is  going  to  be disclosed  in  the purchase  process."                                                               
Addressing  Representative McCarty's  red flag  concern, he  said                                                               
that if he were to get a  conventional loan for $100,000 and an 8                                                               
percent interest  rate, the  value of  that loan  is going  to be                                                               
higher than  if he  were to get  that same $100,000  loan at  a 6                                                               
percent interest  rate.  He  described the banks having  a higher                                                               
level of  faith that  the loan  will get  repaid on  the assessed                                                               
property;  therefore, they  can  offer the  lower interest  rate,                                                               
which  frees up  capital on  the  project that  could be  further                                                               
invested in the property or  community or other developments.  He                                                               
said  these   proposed  transactions  would  be   vetted  by  the                                                               
financial institutions.                                                                                                         
                                                                                                                                
REPRESENTATIVE  MCCARTY stated  concern about  a loan  being used                                                               
for other  purposes than originally  intended.  He  mentioned the                                                               
risk of  being a lender.   He acknowledged that with  the program                                                               
proposed  under  HB  227,  the  risk to  the  lender  is  reduced                                                               
"because property is  seized."  With the  retroactive proposal of                                                               
Amendment 2,  there could  be properties  that have  already gone                                                               
through the  loan process, "and  now we're  going to come  in and                                                               
allow them  to ... seize money,"  and he said he  is concerned if                                                               
that "goes back to 1964."                                                                                                       
                                                                                                                                
9:02:19 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE  explained that  if  he  took  out a  loan  for                                                               
improvement  of property,  only those  improvements that  fit the                                                               
definition   of  HB   227  could   be   refinanced  through   the                                                               
commercially  assessed   property  mechanism.     He   said  with                                                               
refinancing, it is likely the  money has already been invested in                                                               
the  projects,  and when  refinancing  as  a property  lien,  the                                                               
lender  and  municipality  would  make sure  that  the  money  is                                                               
associated with clean energy projects.   He pointed out that both                                                               
commercial  property  owners and  lenders  have  sent letters  of                                                               
support for  HB 227.   He concluded, "It's a  good way for  us to                                                               
... make  more secure  loans, ...  on a longer  term, at  a lower                                                               
cost  of capital  for  the  property owner,  and  allows them  to                                                               
further invest in their community."                                                                                             
                                                                                                                                
9:03:35 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PATKOTAK  asked about  taxing and  the possibility                                                               
of there being a higher rate on the assessed value.                                                                             
                                                                                                                                
CO-CHAIR SCHRAGE  responded that someone who  made the investment                                                               
to his/her  property would  likely have  a higher  assessed value                                                               
and  thus  be paying  higher  property  taxes.   He  offered  his                                                               
understanding that  anyone who made  an investment would  be made                                                               
aware of the tax implications.                                                                                                  
                                                                                                                                
9:05:43 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND  maintained her  objection to  the motion                                                               
to adopt Amendment 2.                                                                                                           
                                                                                                                                
9:05:49 AM                                                                                                                    
                                                                                                                                
A roll call  vote was taken.   Representatives Patkotak, McCarty,                                                               
and  McCabe  voted in  favor  of  Amendment 2.    Representatives                                                               
Drummond,  Schrage,  and Hannan  voted  against  it.   Therefore,                                                               
Amendment 2 failed by a vote of 3-3.                                                                                            
                                                                                                                                
9:07:02 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY moved  to adopt  Amendment 3  to HB  227,                                                               
labeled 32-LS1028\I.5, Dunmire, 3/2/22, which read as follows:                                                                  
                                                                                                                                
     Page 7, line 8, following "of":                                                                                            
     Insert "commercial building"                                                                                           
                                                                                                                                
9:07:06 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN objected  and noted there was  a legal memorandum                                                               
("memo")  to  distribute  [from Andrew  Dunmire,  Legal  Counsel,                                                               
Legislative Legal  Services, dated 3/2/22,  subsequently included                                                               
in the committee packet].                                                                                                       
                                                                                                                                
9:07:15 AM                                                                                                                    
                                                                                                                                
The committee  took a  brief at-ease at  9:07 a.m.  to distribute                                                               
the memo.                                                                                                                       
                                                                                                                                
9:07:58 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY spoke to Amendment  3, which he said would                                                               
specify  the type  of construction  being done  as pertaining  to                                                               
commercial buildings.                                                                                                           
                                                                                                                                
9:08:29 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE again  noted that  the  underlying statute,  as                                                               
well  as  HB  227,  are  already  restricted  to  commercial  and                                                               
industrial  properties.   He referred  to the  legal memo,  which                                                               
notes that  [Amendment 3] would  be inconsistent in that  it does                                                               
not reference industrial  properties.  He said  the limitation to                                                               
only  buildings  could be  problematic.    He said  this  section                                                               
addresses  reports  required,  not   types  of  investments  that                                                               
qualify; therefore, it seems inconsistent  to allow a wider scope                                                               
for  the  types  of  investments allowed  while  restricting  the                                                               
reporting  to just  investments on  commercial buildings  and not                                                               
commercial or industrial properties.                                                                                            
                                                                                                                                
9:09:59 AM                                                                                                                    
                                                                                                                                
A roll call  vote was taken.  Representatives  McCarty and McCabe                                                               
voted  in  favor  of  Amendment  3.    Representatives  Drummond,                                                               
Patkotak,  Schrage,  and Hannan  voted  against  it.   Therefore,                                                               
Amendment 3 failed by a vote of 2-3.                                                                                            
                                                                                                                                
9:10:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY moved  to adopt  Amendment 4  to HB  227,                                                               
labeled 32-LS1028\I.6, Dunmire, 3/2/22, which read as follows:                                                                  
                                                                                                                                
     Page 9, lines 2 - 3:                                                                                                       
          Delete   "[FROM    AN   INDEPENDENT,   THIRD-PARTY                                                                    
     QUALIFIED ENERGY AUDITOR THE FOLLOWING:]"                                                                                  
       Insert "from an independent, third-party qualified                                                                       
     energy auditor the following:"                                                                                             
                                                                                                                                
9:10:59 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND objected.                                                                                               
                                                                                                                                
9:11:21 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCARTY spoke to Amendment 4.   He said he did not                                                               
know  why   the  third-party  auditor  was   being  removed,  and                                                               
Amendment 4 would reinstate that language in HB 227.                                                                            
                                                                                                                                
9:12:05 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE  responded  that  the  reason  the  third-party                                                               
auditor is being  removed is because there has  been the addition                                                               
of projects to  the scope of the financing mechanism  that do not                                                               
have anything  to do with  energy, for example, seismic  or storm                                                               
water improvements.   Further,  he said he  does not  know anyone                                                               
that would loan money without vetting the proposed project.                                                                     
                                                                                                                                
9:13:31 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  HANNAN stated  her understanding  that  HB 227  expands                                                               
existing [statute],  thus an auditor can  direct for construction                                                               
of "XYZ,"  and improvements  on which financing  is based  can be                                                               
met.    However,  with  new  construction,  "you  couldn't  audit                                                               
something that  does not  exist, but  you could  design it  to be                                                               
more energy  efficient."  She  added, "So, requiring audit  of it                                                               
sort of is contrary to allowing new construction."                                                                              
                                                                                                                                
CO-CHAIR  SCHRAGE  confirmed Co-Chair  Hannan  is  correct.   The                                                               
property assessed  financing mechanisms were introduced  only for                                                               
projects that  would result  in a positive  cash flow  via energy                                                               
savings.   However, some  projects may not  result in  savings of                                                               
money but may increase the value of the property, he said.                                                                      
                                                                                                                                
9:15:36 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCABE  moved to  adopt Conceptual Amendment  1 to                                                               
Amendment 4,  to insert "appraiser, or  licensed home inspector,"                                                               
following "auditor".                                                                                                            
                                                                                                                                
9:16:17 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND  objected to  question the use  of "home"                                                               
when  this is  commercial property.   She  then pointed  out that                                                               
there  are already  companies  dedicated  to doing  "construction                                                               
estimating."                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCABE  explained that  his intent was  "to expand                                                               
the   definition  from   energy  auditors,"   and  he   expressed                                                               
willingness   to   change   the  language   to   "architect"   or                                                               
"construction  estimator".     He  explained  his   concern  that                                                               
"there's too much opportunity for  nefarious activity ... between                                                               
banks and good  buddy commercial property owners,"  and he opined                                                               
there  needs to  be a  third party  to verify  the work  is being                                                               
done.                                                                                                                           
                                                                                                                                
9:18:41 AM                                                                                                                    
                                                                                                                                
CO-CHAIR   HANNAN   suggested  Representative   McCabe   withdraw                                                               
Conceptual Amendment 1 to Amendment 4.                                                                                          
                                                                                                                                
9:18:53 AM                                                                                                                    
                                                                                                                                
CO-CHAIR SCHRAGE  suggested that if an  amendment were necessary,                                                               
it could  be to require an  independent third party, but  he said                                                               
he  is struggling  to  come up  with the  right  language and  is                                                               
concerned about legislating "on the fly."                                                                                       
                                                                                                                                
9:19:57 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN  noted those on line,  who could weigh in  on the                                                               
issue.                                                                                                                          
                                                                                                                                
9:20:54 AM                                                                                                                    
                                                                                                                                
SHAINA KILCOYNE,  Energy and Sustainability Manager,  Solid Waste                                                               
Services,  Municipality of  Anchorage,  said it  is difficult  to                                                               
pinpoint which  kind of auditor  to require, and  typically other                                                               
states' statutes  are "leaving that  up to the handbook  where we                                                               
have all of the details of the program within it."                                                                              
                                                                                                                                
9:22:18 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCABE withdrew  the motion  to adopt  Conceptual                                                               
Amendment 1 to Amendment 4.                                                                                                     
                                                                                                                                
9:22:36 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN noted  that the lenders could speak  to the issue                                                               
but were not currently available on line.                                                                                       
                                                                                                                                
9:22:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCABE said  he would  discuss the  issue with  a                                                               
former testifier for the purpose  of offering an amendment on the                                                               
House floor.                                                                                                                    
                                                                                                                                
9:23:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCARTY  concluded   that  more  information  was                                                               
needed to make  an informed decision; therefore,  he withdrew the                                                               
motion to adopt Amendment 4.                                                                                                    
                                                                                                                                
9:24:43 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MCCABE moved  to  adopt Amendment  5  to HB  227,                                                               
labeled 32-LS1028\I.2, Dunmire, 3/2/22, which read as follows:                                                                  
                                                                                                                                
     Page 6, line 16:                                                                                                           
          Delete "market"                                                                                                   
                                                                                                                                
     Page 6, lines 17 - 18:                                                                                                     
        Delete "or completion of the proposed energy or                                                                     
     resilience improvement project"                                                                                        
                                                                                                                                
9:24:49 AM                                                                                                                    
                                                                                                                                
CO-CHAIR HANNAN objected for the purpose of discussion.                                                                         
                                                                                                                                
REPRESENTATIVE  MCCABE  spoke  to  Amendment  5.    He  expressed                                                               
concern  that without  Amendment 5,  the legislation  would allow                                                               
people "to overreach."                                                                                                          
                                                                                                                                
9:26:28 AM                                                                                                                    
                                                                                                                                
CO-CHAIR  SCHRAGE  said  he  understood  Representative  McCabe's                                                               
concern.  He  highlighted that the changes proposed  under HB 227                                                               
are  modeled after  programs  in other  states,  and lenders  are                                                               
supporting  these changes  because  they do  not  result in  high                                                               
risk.    He  talked  again about  opening  markets  and  infusing                                                               
communities with investments made.                                                                                              
                                                                                                                                
9:28:16 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DRUMMOND noted  that  the bill  would remove  the                                                               
word "assess", which she said makes  sense.  She pointed out that                                                               
it  is  more  difficult  to  assess  a  commercial  property,  as                                                               
compared  to a  home;  therefore,  she does  not  think the  word                                                               
"market" needs to  be deleted from the bill.   She added that she                                                               
does not agree with the second part of Amendment 5.                                                                             
                                                                                                                                
9:29:44 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PATKOTAK said he  is inclined to support Amendment                                                               
5 based on the intent of  the maker of the amendment; however, he                                                               
questioned what the  benchmark of value would be  if "market" was                                                               
removed.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  MCCABE explained  the intent  was to  "remove the                                                               
change  that  inserts  'market'   instead  of  'assessed',"  thus                                                               
leaving "assessed value" in the bill language.                                                                                  
                                                                                                                                
REPRESENTATIVE PATKOTAK suggested  adding "assessed" back through                                                               
a conceptual amendment to Amendment 5.                                                                                          
                                                                                                                                
9:31:45 AM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 9:31 a.m. to 9:32 a.m.                                                                       
                                                                                                                                
9:32:51 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MCCABE  moved Conceptual Amendment 1  to Amendment                                                               
5 to insert "assessed" where "market" had been removed.                                                                         
                                                                                                                                
REPRESENTATIVE  DRUMMOND  objected,  and   she  referred  to  her                                                               
previous   comment  about   assessed  valuations   of  commercial                                                               
property.                                                                                                                       
                                                                                                                                
9:34:15 AM                                                                                                                    
                                                                                                                                
CO-CHAIR SCHRAGE said either "assessed"  or "market" needed to be                                                               
left in  the bill.  He  said the Municipality of  Anchorage would                                                               
prefer  "market value"  as a  better metric  to use  in terms  of                                                               
"what the market is  going to pay for the property."   He said it                                                               
would be  "a tremendous  limitation" on  developers or  those who                                                               
want to  invest in communities  by "putting in a  development" if                                                               
they are  allowed to utilize  only existing assets for  the lien,                                                               
and  "the  value  that  would  be created  by  the  loan  has  no                                                               
consideration by  the lender."   He added,  "If we are  to remove                                                               
the ability to  take in that future value that  would be created,                                                               
'market' would be the preferable phrase."                                                                                       
                                                                                                                                
REPRESENTATIVE MCCABE  stated his problem with  "market value" is                                                               
that it  is a nebulous  term because  "it's not defined  who sets                                                               
the market  value."  He suggested  it could be set  by a licensed                                                               
commercial property appraiser.   He concluded, "And  with that, I                                                               
think I'll withdraw this and do it on the floor."                                                                               
                                                                                                                                
9:37:13 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PRAX  proffered  that  the  municipally  assessed                                                               
value  is supposed  to  be the  market value,  and  "that is  the                                                               
official  determination   on  other  property  tax   payments  or                                                               
assessments,  and this  is  kind of  attached to  the  tax."   He                                                               
added,  "So, it  would seem  like we  should stick  with what  is                                                               
legally in there."                                                                                                              
                                                                                                                                
9:38:06 AM                                                                                                                    
                                                                                                                                
CO-CHAIR   SCHRAGE  asked   for  clarification   as  to   whether                                                               
Representative McCabe  had withdrawn just Conceptual  Amendment 1                                                               
to Amendment 5 or the underlying Amendment [5].                                                                                 
                                                                                                                                
REPRESENTATIVE MCCABE responded, "I  withdraw both the conceptual                                                               
amendment and Amendment  5."  In response to  Co-Chair Hannan, he                                                               
noted that  he would not  be offering Amendment 6,  as previously                                                               
planned, at this time.                                                                                                          
                                                                                                                                
9:39:13 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND moved  to report HB 227,  as amended, out                                                               
of   committee   with    individual   recommendations   and   the                                                               
accompanying fiscal notes.                                                                                                      
                                                                                                                                
CO-CHAIR  HANNAN  noted there  had  been  no amendments  adopted;                                                               
therefore,  she  asked  Representative Drummond  to  restate  the                                                               
motion.                                                                                                                         
                                                                                                                                
9:39:36 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE DRUMMOND moved  to report HB 227  out of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes.  There being no objection,  HB 227 was reported out of the                                                               
House Community and Regional Affairs Standing Committee.                                                                        

Document Name Date/Time Subjects
HB 227 MOA CPACE Presentation 1.20.22.pdf HCRA 3/3/2022 8:00:00 AM
HENE 1/20/2022 10:15:00 AM
HB 227
HB 227 Version I.PDF HCRA 3/3/2022 8:00:00 AM
HENE 1/20/2022 10:15:00 AM
HB 227
HB 227 Sponsor Statement 1.20.22.pdf HCRA 3/3/2022 8:00:00 AM
HENE 1/20/2022 10:15:00 AM
HB 227
HB 227 DCCED CRA Fiscal Note.pdf HCRA 3/3/2022 8:00:00 AM
HENE 1/20/2022 10:15:00 AM
HB 227
HB 227 CPACE Sectional 1.20.22.pdf HCRA 3/3/2022 8:00:00 AM
HENE 1/20/2022 10:15:00 AM
HB 227
HB 227 DCCED CRA Fiscal Note 1.27.22.pdf HCRA 3/1/2022 8:00:00 AM
HCRA 3/3/2022 8:00:00 AM
HB 227
HB 227 Letters of Support 2.24.22.pdf HCRA 3/1/2022 8:00:00 AM
HCRA 3/3/2022 8:00:00 AM
HB 227
HB 227 Sponsor Statement 1.27.22.pdf HCRA 3/1/2022 8:00:00 AM
HCRA 3/3/2022 8:00:00 AM
HB 227
HB 309 CS version G.pdf HCRA 3/3/2022 8:00:00 AM
HCRA 3/8/2022 8:00:00 AM
HB 309
HB 309 Sectional Analysis ver G.pdf HCRA 3/3/2022 8:00:00 AM
HCRA 3/8/2022 8:00:00 AM
HB 309
HB 309 Sponsor Statement ver G.pdf HCRA 3/3/2022 8:00:00 AM
HCRA 3/8/2022 8:00:00 AM
HB 309
SB 143 Fiscal Note 0 - Various Depts.pdf HCRA 3/3/2022 8:00:00 AM
SB 143
SB 143 Letter of Support - Matthew Widmer.pdf HCRA 3/3/2022 8:00:00 AM
SB 143
SB 143 Sectional Analysis version I.pdf HCRA 3/3/2022 8:00:00 AM
HCRA 3/8/2022 8:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 143
SB 143 Support Document 1 - Sarah Badten.PDF HCRA 3/3/2022 8:00:00 AM
HL&C 3/14/2022 3:15:00 PM
SL&C 2/9/2022 1:30:00 PM
SB 143
SB 143 Support Document 2 - Pre-1986 Home-Condominium Owners Associations.pdf HCRA 3/3/2022 8:00:00 AM
HL&C 3/14/2022 3:15:00 PM
SL&C 2/9/2022 1:30:00 PM
SB 143
SB 143 Support Document 3 - Post-1986 Home-Condominium Owners Associations.pdf HCRA 3/3/2022 8:00:00 AM
HL&C 3/14/2022 3:15:00 PM
SL&C 2/9/2022 1:30:00 PM
SB 143
SB 143 Statement of Zero Fiscal Impact.pdf HCRA 3/3/2022 8:00:00 AM
SL&C 2/9/2022 1:30:00 PM
SB 143
SB 143 Bill Version I.PDF HCRA 3/1/2022 8:00:00 AM
HCRA 3/3/2022 8:00:00 AM
HCRA 3/8/2022 8:00:00 AM
HL&C 3/14/2022 3:15:00 PM
SB 143
SB 143 Fiscal Note 2.5.22.pdf HCRA 3/1/2022 8:00:00 AM
HCRA 3/3/2022 8:00:00 AM
SB 143
HB 243 – Letter of opposition_Redacted 3.1.22.pdf HCRA 3/3/2022 8:00:00 AM
HB 243
HB 227 Amendments (1-6) 3.2.22.pdf HCRA 3/3/2022 8:00:00 AM
HB 227