Legislature(1999 - 2000)
02/10/2000 08:07 AM House CRA
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE COMMUNITY AND REGIONAL AFFAIRS
STANDING COMMITTEE
February 10, 2000
8:07 a.m.
MEMBERS PRESENT
Representative John Harris, Co-Chairman
Representative Carl Morgan, Co-Chairman
Representative Andrew Halcro
Representative Lisa Murkowski
Representative Fred Dyson
Representative Reggie Joule
Representative Albert Kookesh
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 340
"An Act relating to designating the Ketchikan Indian Corporation
as a regional housing authority."
- MOVED CSHB 340(CRA) OUT OF COMMITTEE
PREVIOUS ACTION
BILL: HB 340
SHORT TITLE: KETCHIKAN INDIAN CORPORATION AS A RHA
Jrn-Date Jrn-Page Action
2/04/00 2098 (H) READ THE FIRST TIME - REFERRALS
2/04/00 2098 (H) CRA
2/04/00 2098 (H) REFERRED TO COMMUNITY & REGIONAL
AFFAIR
2/10/00 (H) CRA AT 8:00 AM CAPITOL 124
WITNESS REGISTER
PETER ECKLUND, Staff
to Representative Bill Williams
Alaska State Legislature
Capitol Building, Room 502
Juneau, Alaska 99801
POSITION STATEMENT: Presented HB 340.
CHARLES WHITE, General Manager
Ketchikan Indian Corporation
429 Deermount
Ketchikan, Alaska 99901
POSITION STATEMENT: Answered questions relating to HB 340.
BOB WEINSTEIN, Mayor
City of Ketchikan
334 Front
Ketchikan, Alaska 99901
POSITION STATEMENT: Testified in favor of HB 340.
REPRESENTATIVE BILL WILLIAMS
Alaska State Legislature
Capitol Building, Room 502
Juneau, Alaska 99801
POSITION STATEMENT: Testified as sponsor of HB 340.
ACTION NARRATIVE
TAPE 00-8, SIDE A
Number 0001
CO-CHAIRMAN HARRIS called the House Community and Regional
Affairs Standing Committee meeting to order at 8:07 a.m.
Members present at the call to order were Representatives Harris,
Morgan, Halcro, Murkowski, Dyson, Joule and Kookesh.
HB 340-KETCHIKAN INDIAN CORPORATION AS A RHA
CO-CHAIRMAN HARRIS announced that the only order of business
before the committee would be HOUSE BILL NO. 340, "An Act
relating to designating the Ketchikan Indian Corporation as a
regional housing authority."
Number 0113
PETER ECKLUND, Staff to Representative Bill Williams, Alaska
State Legislature, read the sponsor statement as follows:
House Bill 340 was introduced at the request of the
Ketchikan Indian Corporation. KIC, the governing body
for the Natives of the Ketchikan area, was formed in
1940 and currently has over 4,00 enrolled members.
KIC has contracted with the Department of Housing and
Urban Development under the Native American Housing
Assistance and Self-Determination Act (NAHASDA) to
provide housing for low-income Indians/Alaska Natives
in the Ketchikan area.
NAHASDA requires that the low-income housing provided
by tribes be tax exempt. Adding KIC to the list of
regional housing authorities will allow KIC to enter
into HUD [U.S. Department of Housing and Urban
Development] required agreements with the appropriate
local government.
Passage of HB 340 will also allow the expenditure of
federal NAHASDA money in the Ketchikan area and provide
sorely needed low-income housing to area residents.
Mr. Chairman, thank you for hearing this legislation on
such short notice. I urge your favorable
consideration.
MR. ECKLUND requested the addition of an immediate effective
date, as that was overlooked during the drafting of HB 340.
Number 0256
[There was a motion to adopt version LS1399\D as a working draft,
but it was the original bill and already was before the
committee.]
REPRESENTATIVE MURKOWSKI noted that the legislation specifically
excludes Saxman. She asked: With regard to housing, is Saxman
covered elsewhere?
MR. ECKLUND informed the committee that Saxman is its own IRA
(Indian Reorganization Act) council and receives its own funds.
Since Saxman is its own local government, it does not have any
difficulties in coming to an agreement with a local government
in order to be tax-exempt.
REPRESENTATIVE MURKOWSKI asked if the Tlingit-Haida Central
Council or the Alaska Native Brotherhood currently provides any
housing in Ketchikan.
MR. ECKLUND deferred to KIC representatives. However, he
understood that not much of the federal housing funds that have
come to the Tlingit-Haida Central Council have gone to the
Ketchikan area.
REPRESENTATIVE KOOKESH asked if passage of HB 340 would adversely
affect Tlingit-Haida or other entities in Southeast Alaska, in
terms of the money that the entity would be eligible for.
MR. ECKLUND explained that the NAHASDA legislation was passed in
1996 and was first funded in 1998. The agreements regarding
funding levels and such were made with passage of that federal
legislation. He again deferred to KIC representatives.
Number 0525
CHARLES WHITE, General Manager, Ketchikan Indian Corporation,
stated that there would be no negative impact on Tlingit-Haida or
any of the other "regionals." He explained that this funding has
been set aside for block grants and thus each individual housing
entity has been granted funds at this time.
MR. WHITE stated, in response to Representative Dyson, that there
is no real low-income housing for the Native population in
Ketchikan or for the community itself. The temporary shelters in
Ketchikan have an approximately 45-49 percent Native population.
Therefore, HB 340 would help alleviate that, since a couple of
units could be set aside for emergency need such as a family
being burned out. He emphasized that the true goal of this would
be to house low-income people and attempt to elevate their
status. He noted that other programs such as job training
activities work in conjunction with this housing program to work
towards house buy-down programs.
Number 0706
REPRESENTATIVE DYSON said he assumes with Ketchikan's logging
industry problems that there has not been a large increase in
Ketchikan's population.
MR. WHITE acknowledged that Ketchikan's population has decreased
somewhat. However, Ketchikan's population has only dropped by
about 1,000 people since Ketchikan's largest employer left almost
three years ago. The population seems to be fairly stable,
although it is not growing. In further response to
Representative Dyson, Mr. White said that the residential rental
market seems to remain stable. He noted that there are many
houses on the market in Ketchikan, which will be beneficial for
KIC in that it will be able to purchase units that are already on
the market. In response to Representative Dyson, Mr. White
related his belief that the rental market is up.
REPRESENTATIVE DYSON inquired whether KIC would be building a new
structure under this program.
MR. WHITE replied not at this time. He explained that KIC will
be looking to purchase ten units or five duplexes for the low-
income housing. The strategic plan would be to eventually build
some housing units. Mr. White agreed with Representative Dyson's
assumption that KIC would not build new units if there are units
available on the market. He mentioned that there is some stigma
associated with grouping low-income housing. Therefore, KIC
will, at this time, purchase units in different areas in order to
reduce that stigma. He further agreed with Representative
Dyson's assessment that KIC, if successful in this project, will
provide housing for those that do not have a place to live.
REPRESENTATIVE DYSON asked if there are ten families in the
Ketchikan area that do not have a place to live.
MR. WHITE replied yes. He explained that there are many families
that live in groups - three families in one housing unit.
REPRESENTATIVE DYSON asked if this proposal is a better strategy
than subsidizing their income so that those individuals could
move into housing already on the market.
MR. WHITE said KIC believes so. With regard to Ketchikan's
economic outlook, he felt optimistic because the veneer plant is
coming. He believed that KIC could work with the various
employers and help people elevate their position and buy their
own housing with the house buy-down program.
Number 0995
REPRESENTATIVE DYSON related his understanding that the units
will not be available to anyone who is not an enrolled member of
KIC.
MR. WHITE said Representative Dyson's understanding is correct.
He felt that this is a vital part of Ketchikan because dollars
will influx into the community. This housing would take some of
the pressure off other state housing operations.
REPRESENTATIVE HALCRO asked if, once KIC receives tax exempt
status, there are requirements that KIC would have to follow with
regard to qualifying someone for low-income housing.
MR. WHITE replied yes. As with other housing block grants, a
lengthy proposal is required. He noted that KIC goes through a
single audit every year, and KIC has received a clean audit every
year since its inception.
REPRESENTATIVE HALCRO asked if KIC has had any discussions with
the local government in Ketchikan. Is the local government
concerned with any adverse impact on the property tax base?
MR. WHITAKER acknowledged that there was some concern [with the
possibility of adverse impact on the property tax base]. He
noted that there had been discussions with the borough and the
city governments in Ketchikan. That will be worked out in the
memorandum of agreement (MOA). He informed the committee that
KIC will make a payment in lieu of taxes, which will be included
in the MOA.
Number 1163
REPRESENTATIVE KOOKESH inquired as to the intent of the HB 340.
MR. WHITE specified that the intent of HB 340 is to place KIC on
the list so that it can negotiate the MOA with the
municipalities. As the statute currently reads, the local
governments have difficulty in understanding what KIC is.
Therefore, this legislation will clarify that KIC is a housing
entity and thus allow KIC to negotiate the MOA with the local
government through statute. In further response to
Representative Kookesh, Mr. White did not know of any housing
authority that was opposed to HB 340. He noted that he deals
with other housing entities and other tribes. Furthermore, he
could not imagine any opposition to HB 340 because the funding is
already developed.
REPRESENTATIVE MURKOWSKI returned to the issue that this proposal
would provide housing to only KIC members. From the statute
provided in the bill packet, Representative Murkowski read a
portion of the May 6, 1981, opinion of the attorney general.
That portion read as follows:
While various specified Native associations are given
authority to establish regional housing authorities
under this section, and may receive donations of land
from municipalities, the programs administered by those
associations must be racially neutral.
REPRESENTATIVE MURKOWSKI interpreted that portion of the opinion
to mean that the corporation could not exclude a person, who
qualified as low-income, even if he/she were not a member of the
corporation.
MR. WHITE informed the committee that all of the Native housing
authorities have the same clients and serve the same population.
He explained that all the HUD dollars for the NAHASDA program are
restricted to Alaska Natives or American Indians. There is not
anything different in this statute, and therefore he assumed that
this issue has been reviewed. He pointed out, "The obligation of
the federal government or the United States in trust is to
provide education, housing and health for the Native population
and the American Indians and thus couldn't be looked at as a
discriminatory factor."
REPRESENTATIVE MURKOWSKI commented that she remained perplexed by
the aforementioned opinion of the attorney general.
Number 1436
REPRESENTATIVE DYSON asked if the property that KIC acquires will
be deed restricted.
MR. WHITE replied no.
REPRESENTATIVE DYSON surmised then that if KIC decided to sell
that property in the future, it could sell the property at market
value.
MR. WHITE agreed with Representative Dyson's assessment.
REPRESENTATIVE DYSON asked if there is a mechanism within the
federal law or KIC's MOA, that would allow the local government
to recapture the taxes that were not paid during the period the
property was not taxed.
MR. WHITE explained that the program requires that all HUD
dollars, including the interest achieved from investing those HUD
dollars, return back to the housing program. He mentioned that
this is a nonprofit organization. Therefore, if a unit were
sold, all the dollars would be reinvested into another part of
the housing program. The only exception is with interest up to
$24,000, which can be reinvested in another area. In further
response to Representative Dyson, Mr. White specified that the
dollars would return to the local housing program not the federal
housing program. He reiterated that the money put back into the
housing program could be used for anything to do with housing.
Number 1580
REPRESENTATIVE DYSON said he suspected that this is all in good
faith and that [KIC] wants to serve its members. However, the
organization could build up this tax-exempt property, sell the
property and do other things with the money from the sale.
MR. WHITE emphasized that all of the programs are run as a
nonprofit and all of the dollars are returned in order to help
people with job training and assist them in emergency general
assistance. He pointed out that their [KIC's] social services
department works in conjunction with the people in need in all
these programs.
CO-CHAIRMAN HARRIS commented that as long as this program has
been in existence, had something such as Representative Dyson
described occurred, something would have been done to end that.
CO-CHAIRMAN MORGAN returned to Representative Murkowski's concern
regarding the attorney general's opinion. He informed the
committee that he belonged to the Village of Aniak and he used to
belong to Aniak's housing authority. Through the NAHASDA
program, Aniak decided to organize its own NAHASDA. He
emphasized his understanding that there is to be no
discrimination. However, each housing authority can write its
own bylaws to allow only members of a particular group.
REPRESENTATIVE KOOKESH asked if anyone had challenged on the
basis of that racially neutral language.
MR. WHITE said that he had not heard of such a suit.
Number 1787
BOB WEINSTEIN, Mayor, City of Ketchikan, testified via
teleconference from Ketchikan. Mayor Weinstein testified in
favor of HB 340. Ketchikan is in need of low-income housing.
He mentioned that the city has a good working relationship with
KIC and has been in discussions with KIC regarding the need for
low-income housing. As a result of those discussions, the
Ketchikan City Council unanimously approved the following: an
ordinance allowing for tax exemptions for low-income housing
projects, as approved by the council on a case-by-case basis; a
five year agreement for a tax exemption for KIC's proposed
project. After the council adopted the ordinance, the council
was advised by the office of the State Assessor that KIC is not
identified in the statute before the committee for amendment.
Therefore, the council could not technically offer that exemption
to KIC. Mayor Weinstein said that the city strongly supports the
inclusion of KIC in this statute. "The city has certainly
weighed, what we believe is a minimum loss of taxes for a five
year period, as balanced against a great need to add some low-
income housing in our community."
CO-CHAIRMAN HARRIS asked if Mayor Weinstein was familiar with
Representative Murkowski's question regarding the authority to
not discriminate.
MAYOR WEINSTEIN replied, "Not relative to the federal program
which funds this program." In the city's discussions with KIC,
it was clear that those who would benefit from this low-income
housing would be eligible members of KIC or other Native
Americans.
CO-CHAIRMAN HARRIS asked if the City Council had any problems
with the payment in lieu of taxes.
MAYOR WEINSTEIN reiterated that an agreement had been reached
with KIC and the City Council did support both the agreement and
the aforementioned ordinance.
Number 1986
REPRESENTATIVE DYSON commented, "These things are troubling to
me." He informed the committee that he does not like government
programs. Furthermore, he expressed his inherent dislike of
anything that is done on a racial basis. He hoped that, had he
been around many years ago, he would have been far more outraged
at the pervasive racism versus the relatively minor and
inconsequential things such as this. Representative Dyson said
there is no reason KIC should not be recognized along with all
the others listed.
REPRESENTATIVE KOOKESH commented that the original purpose and
intent of the legislation that KIC wants to be recognized under
was the acute shortage of housing and related facilities in the
villages of the state. Furthermore, adequate housing could not
be provided by the private sector. Although he recognized that
racially funded programs such as this may not sit well with some,
there is a purpose for these programs. If the private sector
could provide low-income housing, "we" would not be here nor
would this particular legislation. Representative Kookesh said
he would appreciate the support of committee members to move HB
340 forward.
CO-CHAIRMAN HARRIS closed the public testimony.
Number 2172
REPRESENTATIVE MURKOWSKI moved that the committee adopt a
conceptual amendment allowing for an immediate effective date.
There being no objection, it was so ordered.
REPRESENTATIVE DYSON moved to report HB 340, as amended, out of
committee with individual recommendations and the accompanying
zero fiscal note. There being no objection, CSHB 340(CRA) was
reported out of the House Community and Regional Affairs Standing
Committee.
REPRESENTATIVE BILL WILLIAMS, Alaska State Legislature, spoke as
the sponsor of HB 340. He thanked the committee for working on
HB 340. He offered to look into Representative Murkowski's
question regarding the attorney general's opinion, which spoke to
these organizations' being racially neutral.
MR. WHITE also thanked the committee for its expeditious
consideration of HB 340. [CSHB 340(CRA) was reported out of
committee.]
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 8:41 a.m.
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