03/23/2010 01:30 PM Senate FINANCE

SENATE BILL NO. 217                                                                                                           
                                                                                                                                
     "An Act  relating to  the issuance  of state-guaranteed                                                                    
     revenue   bonds   by   the   Alaska   Housing   Finance                                                                    
     Corporation   to  finance   mortgages  for   qualifying                                                                    
     veterans; and providing for an effective date."                                                                            
                                                                                                                                
2:05:32 PM                                                                                                                    
                                                                                                                                
BRYAN  BUTCHER,  DIRECTOR,  GOVERNMENT  AFFAIRS  AND  PUBLIC                                                                    
RELATIONS,  ALASKA HOUSING  FINANCE CORPORATION,  DEPARTMENT                                                                    
OF REVENUE,  reviewed the legislation. He  explained that SB
  requests  approval  through general  election  of  bond                                                                    
sales  for  Alaska   Housing  Finance  Corporation's  (AHFC)                                                                    
veteran  mortgage  program.  He   provided  history  on  the                                                                    
veteran mortgage  program, which  provided a  lower interest                                                                    
rate to  veterans. He explained  that five states  opted in;                                                                    
Texas,  California, Oregon,  Wisconsin,  and Alaska.  Alaska                                                                    
can  sell up  to  $100  million in  bonds  for the  program;                                                                    
however, federal  law requires  a general obligation  of the                                                                    
state's citizens.                                                                                                               
                                                                                                                                
Co-Chair Stedman  asked about the current  number of veteran                                                                    
loans outstanding.                                                                                                              
                                                                                                                                
JOE  DUBLER, DIRECTOR  OF  FINANCE,  ALASKA HOUSING  FINANCE                                                                    
CORPORATION,  responded  that  $341 million  of  outstanding                                                                    
veteran loans exist  at an average rate of  six percent. The                                                                    
current  interest rate  is 4.625  percent. The  bonds issued                                                                    
are  $2.6  million.  Current outstanding  bonds  equal  $338                                                                    
million.  The  remaining   authorization  from  prior  voter                                                                    
approvals  is $95  million. He  informed of  $11 million  in                                                                    
delinquent loans.                                                                                                               
                                                                                                                                
Co-Chair  Stedman  asked  if  the  corporation  was  seeking                                                                    
authorization for the $600 million.                                                                                             
                                                                                                                                
Co-Chair  Stedman   mentioned  the  one  fiscal   note  from                                                                    
Department of  Revenue requesting authorization to  use $150                                                                    
thousand  in  AHFC  receipts  to cover  the  cost  of  voter                                                                    
education.   He  asked   about   marketing  or   information                                                                    
dissemination to encourage public participation.                                                                                
                                                                                                                                
Mr. Butcher  spoke to  the process  in 2002,  which involved                                                                    
mailers  for  every  Alaska  household  along  with  limited                                                                    
television and radio advertising.                                                                                               
                                                                                                                                
Senator  Egan assumed  that the  funding would  be used  for                                                                    
instruction and information. Mr. Butcher concurred.                                                                             
                                                                                                                                
SB  217  was  HEARD  and   HELD  in  Committee  for  further                                                                    
consideration.