Legislature(2001 - 2002)
05/07/2002 03:50 PM Senate STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 312-ENTERPRISE ZONES ZACH WARWICK, staff to the bill sponsor, Senator Gene Therriault, explained that SB 312 authorizes the Governor to declare up to four areas of the state as enterprise zones every year. Zones would be designated due to economic distress and each designation could last up to 20 years. This is designed to encourage and authorize local municipalities to offer incentives within the zone. Such incentives could include a reduction of permit or user fees, credit toward exemptions in property taxes, and flexibility in regulations such as zoning, leasing or sale of municipal properties. There are two state incentives that are included. First, 15 percent of the initial investment put into the area would count as credit toward state corporate income taxes for that first year. The credit may not be carried forward. Second, there would be a $500.00 corporate income tax credit for each new employee hired every year. One of the major reasons behind the bill is to help communities to produce proposals and qualify for federal grants and federal tax credits that are offered by HUD (Health and Urban Development) and the U.S. Department of Agriculture. There were amendments made in the Community and Regional Affairs Committee to make the language clear. CHAIRMAN THERRIAULT said there was language that was problematic in terms of whether the federal government or the state government acted first. He asked whether that language was clarified. MR. WARWICK said that language was deleted. The second issue dealt with cities within a borough. Original language said a city within a borough is not eligible to make a proposal for an enterprise zone, which would exempt many of the cities in the state. The third amendment was to change the language regarding size of the areas that would be called enterprise zones. Originally the areas were census tracts, which is about a 10,000 person area. That was changed to one or more continuous block groups in the U.S. census or a compact geographic area. Senator Lincoln requested that change because original language excluded rural Alaska. CHAIRMAN THERRIAULT asked whether there were any other issues brought up that were not addressed. MR. WARWICK replied all issues were addressed. There was no further testimony. CHAIRMAN THERRIAULT said he had no prepared CS and members offered no amendments. There were two fiscal notes. He asked for the will of the committee. SENATOR PHILLIPS made a motion to move SB 312 and accompanying fiscal notes from committee with individual recommendations. There being on objection, it was so ordered.
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