02/02/2012 09:00 AM Senate STATE AFFAIRS

             SJR 10-CONT. AM.: BUDGET RESERVE FUND                                                                          
                                                                                                                                
9:06:25 AM                                                                                                                    
CHAIR  WIELECHOWSKI   stated  that  the  next   bill  before  the                                                               
committee  was SJR  10. This  constitutional amendment  would cap                                                               
the amount  of unrestricted oil  revenue that  can be spent  in a                                                               
given year at $6 billion,  adjusted for inflation, and two-thirds                                                               
of  the  surplus would  be  put  into the  Constitutional  Budget                                                               
Reserve (CBR).                                                                                                                  
                                                                                                                                
CHAIR  WIELECHOWSKI  said  that the  committee  heard  compelling                                                               
testimony  from  two  university   experts  in  support  of  this                                                               
concept. The  first was Dr.  Scott Goldsmith of the  Institute of                                                               
Social and  Economic Research who  has written  extensively about                                                               
state finances and  the need to spend wisely. The  second was Dr.                                                               
Steven Haycox, an Alaska historian  and author of many books. The                                                               
bill has a  further referral to the Senate  Finance Committee. It                                                               
is  one  of  many  ideas  on the  table  for  ensuring  that  our                                                               
financial  house  in in  order  as  oil production  continues  to                                                               
decline. If passed by the legislature,  it would go to the people                                                               
of  Alaska for  a vote.  The  bill has  a modest  fiscal note  of                                                               
$1,500  to cover  the  cost of  providing  information about  the                                                               
amendment  on   the  elections  booklet  for   the  2012  general                                                               
election.                                                                                                                       
                                                                                                                                
SENATOR  GIESSEL  stated that  a  constitutional  amendment is  a                                                               
significant action  and should address  an issue that  is durable                                                               
over time. She  recalled testimony that stated  that excess funds                                                               
would only  exist for  the next  two to three  years in  light of                                                               
declining oil production. She opined  that it was not appropriate                                                               
to  amend  the  constitution  for something  that  will  only  be                                                               
relevant  for a  few years.  She  also disapproved  of tying  the                                                               
hands of future legislatures.                                                                                                   
                                                                                                                                
SENATOR WIELECHOWSKI  opined that  the intent of  the bill  is to                                                               
put a framework into the future to provide for savings.                                                                         
                                                                                                                                
SENATOR KOOKESH said  that he was inclined to  support bills that                                                               
required a  vote of the  people; however, he was  uncertain about                                                               
what would happen in the next three years.                                                                                      
                                                                                                                                
9:09:37 AM                                                                                                                    
SENATOR PASKVAN moved  [to report the CS for SJR  10, labeled 27-                                                               
LS1091\D, from committee with  individual recommendations and the                                                               
attached fiscal note.]                                                                                                          
                                                                                                                                
SENATOR  WIELECHOWSKI  announced  that without  objection,  CSSJR
(STA) moved from the Senate State Affairs Standing Committee.