Legislature(1995 - 1996)
01/29/1996 01:05 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 392 - NATIVE CORP DIRECTOR CLASSIFICATION Number 0165 REPRESENTATIVE IVAN IVAN, sponsor of HB 392, presented the bill. He prefaced his remarks by saying he represented District 39, Southwestern Alaska. He explained that HB 392 amended the Alaska Corporations Code to allow Alaska Native Claims Settlement Act (ANCSA) village corporations to amend their articles and bylaws to authorize a classified or staggered term board of directors by a majority vote of the shares represented at a meeting of shareholders. Under current law, for those villages which did not have classified boards in place by July 1, 1989, such an amendment required a vote of two-thirds of all outstanding shares entitled to vote. This was often difficult for village corporations to achieve. House Bill 392 rectified that situation. REPRESENTATIVE IVAN added that HB 392 was introduced at the request of a village corporation based out of Napaskiak, located several miles downriver from Bethel, as well as a village corporation north of the Yukon River. For years, these corporations had attempted to classify their boards of directors. However, the requirement for a vote of two-thirds of all shares prevented the corporations from achieving that goal. REPRESENTATIVE IVAN explained that most of these small communities had five directors in place. With five directors, current law required each one to be up for reelection each year. The villages were seeking continuity in their boards of directors. With more than five directors, they could institute staggered terms. The purpose of HB 392 was to implement these changes. Number 0401 REPRESENTATIVE IVAN commented that Glen Price, attorney for the two village corporations, was available to answer questions. Representative Ivan added that when the HB 392 had been introduced in the House Community and Regional Affairs Committee, he had not heard any opposition to the bill. It was simple and straight- forward, he said. Number 0463 REPRESENTATIVE JOE GREEN asked whether Representative Ivan knew what the attitudes of the other villages were towards HB 392. REPRESENTATIVE IVAN replied that with more than 200 village corporations in Alaska, he could not respond to that. However, he felt certain that many small villages fell into this category. Bigger communities such as Bethel, he added, had up to nine directors; the regional corporations had nine or more. But as for the smaller villages, he knew of nobody who had come forward opposing this concept or having concerns over it. Number 0527 REPRESENTATIVE CON BUNDE asked how many village corporations Representative Ivan had communicated with about the issue. REPRESENTATIVE IVAN reiterated that they had not received opposition to HB 392. Number 0570 CHAIRMAN PORTER declared that in reviewing the bill, he and Tom Meyer, committee aide for the House Judiciary Committee, had noticed that while HB 392 appeared straight-forward, clear and easy to understand, it was involved in a body of law that was anything but clear and concise. CHAIRMAN PORTER observed that no one else was present to testify; however, before taking action on the bill, he wanted to mention that Mr. Meyer had discovered the law being amended by HB 392 was not a codified law. It was a session law grandfathering every corporation that had been incorporated prior to 1989 into the laws now being amended. For some reason, he said, these laws had never been codified. The new, revised law affecting corporations incorporated on or after July 1, 1989, was the one on the books. To anyone except a corporation lawyer, he said, that could be extremely confusing for someone reviewing the law books to determine which law affected which corporation, especially if it were a corporation begun prior to 1989. The question had just come up, he said, and nobody had been able to give them an answer yet. He stated his belief that the body of law in question needed to be codified in order to minimize confusion. He added that Representative Ivan's office was going to investigate the matter before HB 392 went to the House Finance Committee. Chairman Porter asserted that matter would probably not be affected by HB 392 one way or the other; it was a side issue, however, that needed addressing. Number 0733 REPRESENTATIVE GREEN moved that HB 392, version C, move from the House Judiciary Committee with individual recommendations and zero fiscal notes. There being no objection, it was so ordered.