Legislature(2013 - 2014)HOUSE FINANCE 519
04/10/2014 08:30 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB121 | |
| SB56 | |
| HB160 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 56 | TELECONFERENCED | |
| + | SB 64 | TELECONFERENCED | |
| + | SB 173 | TELECONFERENCED | |
| + | HB 160 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| = | HB 121 | ||
HOUSE BILL NO. 121
"An Act relating to the examinations, board, loans,
records, and lobbying contracts of the Alaska
Commercial Fishing and Agriculture Bank; and providing
for an effective date."
8:38:09 AM
Co-Chair Stoltze discussed the CS before the committee. He
reported one minor change replacing language regarding loan
qualifications. The language was much softer than the
earlier version and mirrored language from the Alaska State
Constitution regarding sustainability.
Vice-Chair Neuman MOVED to ADOPT the proposed committee
substitute for HB 121(FIN), Work Draft (28-LS0491\O). There
being NO OBJECTION, it was so ordered.
Representative Gara MOVED to ADOPT Amendment 1.
Page 5, following line 10:
Insert a new bill section to read:
"* Sec. 2. AS 44.81.215 is amended by adding a new
subsection to read:
(b) Before making a loan under this section, the board
must find that the loan will not result in the
displacement of an existing or planned Alaskan-owned
business."
Renumber the following bill sections accordingly.
Page 7, line 26:
Delete "sec. 7"
Insert "sec. 8"
Page 7, line 28:
Delete "sec. 7"
Insert "sec. 8"
Representative Wilson OBJECTED for discussion.
Representative Gara explained that HB 121 expanded
Commercial Fishing and Agricultural Bank's (CFAB) ability
to loan to businesses owned by persons and corporations
outside of Alaska. Much of CFAB's activity was related to
Alaskan-owned businesses. He stressed the importance of
Amendment 1 which would require the CFAB board to determine
whether or not a loan would displace an existing or planned
Alaskan-owned businesses prior to making a loan.
8:42:08 AM
LELA KLINGERT, COMMERCIAL FISHING AND AGRICULTURE BANK
(CFAB), ANCHORAGE (via teleconference), asked for
clarification about the amendment.
Representative Gara read his amendment and indicated that
it addressed the new sections on non-Alaskan businesses.
Ms. Klingert replied that the board was not typically
involved in the credit process. She expressed logistic
concerns reporting that the board only met about five times
a year. She also stated her uncertainty about how the board
would make appropriate determinations.
8:43:57 AM
Representative Holmes commented that although she liked the
intent of the amendment she did not think it set forth a
feasible standard from which a bank could make a
determination. She opposed the amendment.
Vice-Chair Neuman stated that many lodges up and down the
Susitna River were owned by out-of-state and out-of-country
owners. He liked the amendment and believed CFAB was
supported under Alaska Statute as the original intent.
Representative Thompson liked the intent of the amendment,
but did not understand how to define "planned" and apply it
in the loan approval process.
8:45:40 AM
Representative Gara MOVED to AMEND Amendment 1. He wanted
to remove the words "or planned" from line 5. There being
NO OBJECTION, it was so ordered.
A roll call vote was taken on the motion to adopt Amendment
1 as amended.
IN FAVOR: Wilson, Costello, Edgmon, Gara, Guttenberg,
Neuman, Thompson, Austerman, Stoltze
OPPOSED: Holmes, Munoz
The MOTION PASSED (9/2). Amendment 1 as AMENDED was
ADOPTED.
8:47:44 AM
Representative Gara MOVED to ADOPT Amendment 2.
Page 1, following line 4:
Insert a new bill section to read:
"* Section 1. AS 44.81.020(a) is amended to read:
(a) The bank shall be governed by a board of directors
consisting of seven to nine natural persons. The
number is determined by the bank's bylaws. Two board
members shall be appointed by the governor of the
state. The other board members shall be elected by the
members of the bank as provided in the bank's bylaws,
except that at least one of the elected board members
must be a resident farmer. The board members appointed
under this section must be residents of the state and
meet the requirements of AS 39.05.100."
Page 1, line 5:
Delete "Section 1"
Insert "Sec. 2"
Renumber the following bill sections accordingly.
Page 7, line 26:
Delete "sec. 7"
Insert "sec. 8"
Page 7, line 28:
Delete "sec. 7"
Insert "sec. 8"
Representative Wilson OBJECTED.
Representative Gara reported that there was a statute on
the books that required board members on state boards to be
Alaska residents. He furthered that there was ambiguity
whether or not CFAB was a state bank. He explained that the
purpose of the amendment was to clarify that CFAB board
members were required to be residents of Alaska.
8:48:39 AM
Ms. Klingert stated that she did not see an issue with the
amendment. She reported that when CFAB made a loan it
adhered to the statutes by lending only to Alaska
residents. She indicated that members who moved out of the
state after the fact maintained their membership. Given
that CFAB was a cooperative she suggested that it was
appropriate for members to be able to elect who they wanted
to represent them and that they would potentially be
impaired to do so by having less of a selection to choose
from with the amendment.
Co-Chair Austerman suggested that if the amendment was
incorporated into the Alaska Statutes it would be clear
that only Alaska residents would be eligible for election
to CFAB's board of directors. He asserted that the issue
was not complicated.
Co-Chair Stoltze remarked that fishermen who had moved to
Seattle rationalized the expansion in the bill by
expressing that they were still Alaskans in their hearts.
He noted approval from other committee members. He asked
Ms. Klingert whether or not she was advocating moving out
of state.
8:51:32 AM
Ms. Klingert replied that other permit holders resided
outside of Alaska. She agreed with the statement.
Representative Guttenberg clarified that a board member had
to be an Alaska resident at the time of their appointment.
He remarked that it was pretty clear and simple.
Co-Chair Stoltze stated that he initially thought he was
going to vote against the bill but after talking with
commercial fishermen he did not see it as deleterious.
Co-Chair Austerman interjected that the bill did not just
apply to commercial fishermen. He stressed that it
pertained to all people making applications with CFAB.
Co-Chair Stoltze acknowledged Representative Austerman's
point.
8:53:21 AM
Vice-Chair Neuman asked if the intent was for board members
to be Alaska residents. He further inquired whether or not
members who moved out of state would remain eligible for
reappointment.
Ms. Klingert replied that the terms were three years for
both the board members elected by the membership and two
governor-appointed delegates.
8:54:16 AM
Vice-Chair Neuman asked whether or not board members were
subject to legislative approval. Ms. Klingert replied in
the negative.
Vice-Chair Neuman assumed that board members who moved out
of state would not be eligible for reappointment.
Representative Munoz asked about the current requirements
for board membership and about how many were Alaska
residents.
Ms. Klingert replied that aside from the governor-appointed
seats, one board seat had to be filled by a farmer, the
other two seats had to be filled with bank members who were
not involved in litigation with the bank.
Representative Munoz asked whether or not there were any
non-residents on the board currently.
Ms. Klingert stated that to her knowledge the board only
consisted of Alaska residents.
8:55:56 AM
Representative Gara remarked that the law would not be
interpreted any differently from the law that already
existed for all other boards. He believed that the current
law was interpreted to mean that board members had to be
Alaska residents and if their status changed they would
lose their eligibility. He reiterated that the amendment
guaranteed clarity that the law applied to CFAB board
members.
Representative Wilson WITHDREW her OBJECTION.
There being NO further OBJECTION, Amendment 2 was ADOPTED.
Representative Costello pointed to the fiscal impact note
from Department of Commerce, Community and Economic
Development including $5.7 thousand in FY 16 and FY 19 for
travel and a change in revenue of $23.5 thousand in FY 15
and FY 19.
8:57:59 AM
Vice-Chair Neuman MOVED to REPORT CSHB 121(FIN) out of
committee with individual recommendations and the
accompanying fiscal note. There being NO OBJECTION, it was
so ordered.
CSHB 121(FIN) was REPORTED out of committee with "no
recommendation" and with one new fiscal impact note from
the Department of Commerce, Community and Economic
Development.
8:58:29 AM
AT EASE
8:59:10 AM
RECONVENED