Legislature(1997 - 1998)
03/18/1998 01:45 PM House FIN
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SENATE BILL NO. 261
"An Act relating to the Special Olympics World Winter
Games to be held in Anchorage in the year 2001;
establishing a reserve fund for the games; providing
certain duties and authority for the Alaska Industrial
Development and Export Authority regarding financing
for those games; and providing for an effective date."
MARY GORE, STAFF, SENATOR MILLER observed that she is also
the Area Director, for the Special Olympics, Juneau. Ms.
Gore noted that the Legislation is a result of hard work by
a variety of people to guarantee that Anchorage would be
awarded the Special Olympics World Winter Games in 2001.
Ms. Gore observed that, several years ago, Jim Belamaci,
Executive Director of Special Olympics Alaska, decided it
would be a great thing to bring the World Winter Games to
Anchorage. He enlisted the help of Senator Ted Stevens. An
organizing committee was formed. Last summer the Anchorage
organizing committee was told by the Special Olympics
International (SOI) that in order to be awarded the bid, the
state would need to be the financial guarantor. The Special
Olympics International would not go in the hole as a result
of any location being awarded the bid. She observed that
the money does not need to be appropriated prior to the bid
being awarded but state support must be demonstrated.
Ms. Gore stressed that the State must be on the record as
the obligor if the money is not raised by private sources.
This legislation "morally obligates" the state to make up
the difference, up to $4 million dollars if the organizing
committee does not raise the funds. She maintained that the
risk to the State is minimal. The total budget for the
games is $8 million dollars, with $4 million dollars in cash
and $4 million dollars in kind contributions. Thus far
about $1 million dollars in cash has been raised. The
organizing Committee has 3 years to raise the remainder.
The legislation has a set of checks and balances. The
Alaska Industrial Development and Export Authority will
oversee fundraising and report to the legislature on January
2 of each year as to the status of their efforts. She
maintained that in the event that the Committee falls
behind, a gentle push from the legislature could put them
back on track.
Ms. Gore concluded that the legislation only "morally
obligates" future legislatures. In the year 2001, the
legislature would need to appropriate the funding and
authorize expenditures for use if it were needed.
Co-Chair Therriault expressed concern that the state of
Alaska not be responsible for more than the initial $4
million dollars. Ms. Gore assured him that the state of
Alaska's liability would not exceed that amount.
Representative Martin questioned Ms. Gore in regards to
housing. Ms. Gore clarified that the intention is to use
housing available at Anchorage military bases. Athletes
would be housed at Fort Richardson and the Elmendorf Air
Force Base. She noted that Camp Carroll had been used in
the past for Alaskan Special Olympic activities, but that
the military bases were preferable. Athletes could be
housed in a semblance of an Olympic village. Athletes want
to be able to stay together.
(Tape Change, HFC 98 -67, Side 2)
Co-Chair Hanley observed that the Committee could raise more
than $4 million dollars, and still spend more than they
raised. He concluded that the state of Alaska could be
liable for the amount that was spent beyond what was raised,
even though the initial $4 million dollars was met. Ms.
Gore emphasized that it is not the intent that the state of
Alaska be responsible for more than the initial $4 million
dollars. She observed that the budget was developed based
on previous games.
Co-Chair Hanley reiterated concerns that the State not be
responsible for amounts over budget. He stressed that the
legislation must clarify that the state of Alaska is not
responsible for expenditures, if the Committee does not
stick within their budget.
KEITH LAUFER, ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT
AUTHORITY, DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT
(AIDEA) testified in support of SB 261. He emphasized that
the moral obligation guarantee makes sense. He observed
that AIDEA would provide a finding of reasonable due
diligence and work on a financial plan. The Alaska
Industrial Development and Export Authority has had
experience reviewing financial plans. He stressed that
AIDEA will watch to make sure that the budget stays within
the financial plan.
Representative Martin clarified that an AIDEA representative
would be at the financial meetings.
In response to a question by Representative Martin, Ms. Gore
stated that they did not know how many athletes would be
competing. She estimated that there would be 6,000 to 7,000
thousand people participating. This includes athletes,
trainers, coaches, families and press. Eight hundred to a
thousand athletes are expected to participate.
Representative Davies observed that the Legislature would be
morally obligated to a cumulative total of $4 million
dollars if there is insufficient money from the other
sources to satisfy the finance plan. He pointed out that
the finance plan is not limited to $4 million dollars in
cash.
Mr. Laufer observed that the International Special Olympics
Committee sought a straight $4 million dollar guarantee by
the state of Alaska. A $4 million dollar moral obligation
was offered in place of a straight guarantee. Co-Chair
Therriault questioned if the guarantee would be on the first
$4 million dollars or on subsequent money. Mr. Laufer
clarified that the guarantee would be on the last $4 million
dollars needed for the game. He pointed out that the
legislation requires the financial plan to minimize the cost
to the State. The cost to the State would be after all
other sources are insufficient.
Ms. Gore stressed that if additional cash is raised that the
intent is that they be able to spend the money. Co-Chair
Therriault questioned if the state of Alaska would be
responsible for money expenditures beyond $4 million
dollars. Ms. Gore stated that the intent of the legislation
is to exempt the state from obligation once the $4 million
dollars is spent.
Mr. Laufer referred to section 4(d). He noted that AIDEA
has to find after reasonable due diligence that the plan
minimizes the cost to the state of Alaska. The budget would
only be increased after a finding that the burden of the
state has been minimized to zero.
Co-Chair Hanley suggested that the state of Alaska's
guarantee should be up to the first $4 million dollars in
cash.
Representative Martin asked if transportation costs are paid
for the athletes. Ms. Gore noted that athletes pay for
their own transportation. Food is the major cost. Some
venues will be free or at a reduced cost. She clarified
that food, transportation and housing would be purchased at
a reduced cost from the military.
Co-Chair Therriault noted his intent to draft a committee
substitute to clarify that the state of Alaska's would only
guarantee the first $4 million dollars in cash.
SB 261 was HELD in Committee for further consideration.
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