Legislature(2005 - 2006)CAPITOL 124
02/08/2005 08:00 AM COMMUNITY & REGIONAL AFFAIRS
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HB 119-AK REGIONAL ECONOMIC ASSISTANCE PROGRAM CO-CHAIR OLSON announced that the next order of business would be HOUSE BILL NO. 119, "An Act extending the termination date of the Alaska regional economic assistance program; and providing for an effective date." 8:27:52 AM KACI SCHROEDER, Staff to Representative Thomas, Alaska State Legislature; House Community and Regional Affairs Standing Committee, paraphrased from the following written sponsor statement [original punctuation provided]: The Alaska Regional Development Organizations (ARDOR's) were created in 1988 by the Alaska Legislature. ARDOR's are non-profit organizations comprised of local volunteers working together to promote economic development in their regions. The advantages of having a program like this working on the regional level are that the ARDOR's are able to coordinate with other economic development activities and collect and distribute economic information within their regions. In addition, ARDOR's serve as a liaison between the region and the state and federal governments. Today, there are 11 ARDOR's assisting 11 regions in the state. Each ARDOR has a board whose members are appointed by various organizations within the region. It is the responsibility of the board to ensure that an annual work plan is executed. Each ARDOR's grant is approximately $50,000. This money is not earmarked for a specific use. Rather, the ARDOR's are free to use the money where they need it most. This allows them to be more flexible and efficient in achieving their goals. To date, this funding formula has been especially effective resulting in substantial economic growth throughout the state. The ARDOR's program has repeatedly presented itself to the Alaska State Legislature and has repeatedly proven itself a worthy investment of the state's resources. Further, in order to continue the achievements of the ARDOR's program, it is necessary that the program be able to count on a certain level of funding in the future. It is for these reasons that HB 119 extends the sunset date for the program to 2013 allowing for eight more years of growth of this valuable program. I strongly urge your support of HB 119. 8:29:32 AM ROLLO POOL, Executive Director, Southeast Conference, began by explaining that the Southeast Conference is the ARDOR for the Southeast region. He related that the Southeast Conference is in support of HB 119, which is one of the organization's top legislative priorities for 2005. Mr. Pool acknowledged that a couple of years ago there were some issues regarding how the Southeast Conference accounted for the work it did. Therefore, [the Southeast Conference] developed a tiered system for obtaining funding. Also, some competitive grants were created. Mr. Pool informed the committee that the Southeast Conference is 50 years old and deals with various industries. This money would allow [the Southeast Conference] to pay for meetings, staff, and associated costs that grants don't allow. In fact, the amount of money leveraged outside of this grant is about 18:1, while he recalled that the ratio for the other ARDORs is about 8:1 and thus for every dollar of the ARDOR grant, the ARDOR was able to bring in $8 more in terms of other grants and funding sources. Mr. Pool said that he views [the ARDORs] as a partner with the state, a partner that he viewed as underutilized. He said, "We would like to be a link ... in the stream of issues that connect our state on economic development." 8:31:52 AM REPRESENTATIVE NEUMAN asked if [the ARDORs] are taking steps to include the public. MR. POOL suggested that a better organization within the ARDOR group would be appropriate. He informed the committee that last week the ARDORs met in Juneau and discussed collaboration efforts in which the stronger ARDORs can help the others rise to a higher performance level. He said that the ARDORs must also work on educating state agencies and the legislature. He related that the ARDORs should lead by example and work with state and federal agencies in order to become a partner. 8:33:25 AM REPRESENTATIVE SALMON inquired as to why [the ARDORs] seem to only be located in population centers and not in central Alaska. MR. POOL explained that [ARDORs] are formed by groups within the area. If a group of communities wants to form an ARDOR, the state will work with it to do so. The group forms first and then approaches the state. Mr. Pool related that some groups in the Interior communities have discussed forming an ARDOR. 8:34:51 AM REPRESENTATIVE NEUMAN asked if there is a mechanism in place to help expand the boundaries of the current [ARDORs] in order to include other nearby areas. MR. POOL pointed out that the Southeast Conference area abuts the Prince William Sound group. He acknowledged that there are issues, such as the ferry system, that transcend boundaries. He opined that there might be some resentment if one group takes over another regional group's area. He indicated that [the Southeast Conference] would help any group interested in forming [an ARDOR]. 8:36:24 AM REPRESENTATIVE NEUMAN commented that it might be difficult for one community to organize, and therefore he indicated that perhaps [existing ARDORs] could expand and include one community at a time. MR. POOL said that he isn't aware of how the boundaries were formed in other areas. The boundary for the Southeast Conference is a natural boundary between Yakutat and Ketchikan. The Southeast Conference doesn't have the ability to expand without moving into the boundary of others. Mr. Pool agreed that perhaps the Fairbanks borough could take on some other communities, if there was support in those other communities. He highlighted that most of the staff for ARDORs are volunteers. There has to be some momentum and energy in the community in order for the [group to form/expand]. 8:37:29 AM MR. POOL, in response to Representative Salmon, confirmed that each ARDOR has a Board of Directors. He specified that he didn't know how others select their board, but the Southeast Conference has 13 directors in Southeast Alaska. According to Southeast Conference's bylaws a majority of the directors must be city/borough employees or elected officials. 8:38:12 AM REPRESENTATIVE SALMON surmised then that would be the reason why [there aren't ARDORs] in the Interior. MR. POOL said he didn't know. He specified that Southeast Conference's board of directors is selected by its membership. The board membership attempts to be a representative sample of the region. 8:39:46 AM WAYNE STEVENS, President, Alaska State Chamber of Commerce, stated: The Alaska State Chamber of Commerce supports the reauthorization and funding of the Alaska Regional Development Organization Program to engage in economic development planning, strategizing and implementation through effective public and private sector collaboration on local, regional, and state levels. MR. STEVENS related that he has been involved for 16 years with Southwest Alaskan Municipal Conference, and even served as the chair of that [ARDOR] from 2001-2003 when U.S. Senator Ted Stevens provided $30 million for stellar sea lion mitigation. The ARDOR has had tremendous impact in bringing together diverse sections of the Southwest region. He opined that the [ARDOR] process works and is collaborative. Mr. Stevens concluded by urging passage of HB 119. 8:41:31 AM SALLY SADDLER, Legislative Liaison, Office of the Commissioner, Department of Commerce, Community, & Economic Development, related that the department views economic development as a partnership. She further related that the department looks forward to working with ARDORs, which are uniquely positioned to represent local communities and regional ideas for economic development. Ms. Saddler highlighted that the ARDORs have created a performance-based measurement system that seems to identify a unique system by which the ARDOR takes on the identity of the services and opportunities in the region. Ms. Saddler concluded by urging passage of HB 119. 8:42:53 AM JEFF COOK, Director, External Affairs, Flint Hills Resources; Member, Fairbanks North Star Borough Economic Development Commission; urged the committee to reauthorize the ARDORs. He specified that the Fairbanks North Star Borough Economic Development Commission is the ARDOR in Fairbanks. Mr. Cook said he is impressed with the dedication to economic development the local governments involved with this ARDOR have. Mr. Cook informed the committee that the areas of accomplishment for the North Star Borough Economic Development Commission have been in the area of cold climate housing research, hosting the Alaska Federation of Natives convention, and working with VISTA volunteers. 8:45:01 AM DEB HICKOK, President/CEO, Fairbanks Convention and Visitors Bureau, had her comments read by Catherine Dodge, as follows: I have been in the business of economic development, specifically destination marketing, for a number of years .... In order for organizations like ours to be successful, it is critical to have the support of local government. The ARDOR facilitates are an even better scenario, programs that augment (indisc.) or give impetus to our success as well as economic development throughout our community. It is imperative that the state invest economic development monies on the local level, where we can partner to focus our efforts on successes that are identified as needed by the local community. This morning Fairbanks is welcoming 325 Japanese guests on a charter direct from Narida(ph) airport. That event was made possible by the cooperative partnerships with local government. I urge you to reauthorize the ARDORs for eight years and continue the $650,000 bonding. Thank you for your hard work in Juneau on our behalf. 8:46:42 AM WANETTA AYERS, Southwest Alaska Municipal Conference, explained that the Southwest Alaska Municipal Conference represents the Alaska Peninsula, Aleutian Islands, Bristol Bay, Kodiak archipelago, and the Pribilof Islands. She mentioned that the members should've received a copy of the ARDOR annual report, which details accomplishments of the ARDORs in the areas of business retention and expansion, work force development, market development, infrastructure development, and economic development planning and research. Since the last reauthorization, the ARDORs have developed a tiered funding formula, which provides the department a tool by which it can access and monitor the progress of each ARDOR. The tiered formula provides a 70:20:10 split of ARDOR funding. She explained that all of the certified ARDORs participate in the 70 percent funding while those meeting the Tier II criteria participate at an additional 20 percent, and those meeting the Tier III criteria participate in the 10 percent. This tiered formula was a direct response to the legislative inquiries received during the last reauthorization process. She opined that the tiered formula provides the flexibility to develop organizational structure to meet the needs of the community the ARDOR serves. "The report, as you've heard, details the leveraging of every state dollar by generating an additional $8 from other sources," she stated. MS. AYERS related that the Southwest Alaska Municipal Conference works across many state and federal agencies to implement and pursue the economic development priorities of the region. In addition to the Southwest Alaska Municipal Conference's board of directors, there are numerous volunteers who serve on committees. Furthermore, the Southwest Alaska Municipal Conference is in the process of establishing a new regional workforce development council that will work collaboratively to address some of the region's work force development issues. In regard to comments about some areas not being represented with an ARDOR, Ms. Ayers informed the committee that in the past there were 14 ARDORs, of which 3 weren't recertified because they couldn't maintain the criteria state regulations require. Of the three areas that didn't recertify, one group has expressed interest in re-forming an ARDOR. In terms of the Interior, Ms. Ayers related that the Tanana Chiefs Conference is interested in establishing an ARDOR. In conclusion, Ms. Ayers urged the committee to reauthorize the ARDOR program. 8:51:20 AM CO-CHAIR OLSON closed public testimony. 8:51:24 AM REPRESENTATIVE NEUMAN recalled his own experience in which it was difficult to obtain contact with an ARDOR. Therefore, he suggested that the ARDORs look into ways to reach the public regarding what ARDORs are working on and how to contact ARDORs. He recommended passage of HB 119. 8:52:20 AM REPRESENTATIVE SALMON opined that the [existing ARDORs] should try to include more of the rural areas. He opined that it seems that the [existing ARDORs] are bypassing the rural areas, although the rural areas need help as well. 8:53:02 AM CO-CHAIR OLSON requested that Ms. Saddler discuss Representative Salmon's concerns after the meeting. 8:53:14 AM CO-CHAIR THOMAS moved to report HB 119 out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, HB 119 was reported out of the House Community and Regional Affairs Standing Committee.