Legislature(2021 - 2022)SENATE FINANCE 532
03/22/2022 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB132 | |
| SB235 | |
| Presentation: Department of Revenue, Spring Forecast | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 132 | TELECONFERENCED | |
| *+ | SB 235 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
SENATE FINANCE COMMITTEE
March 22, 2022
9:04 a.m.
9:04:11 AM
CALL TO ORDER
Co-Chair Bishop called the Senate Finance Committee meeting
to order at 9:04 a.m.
MEMBERS PRESENT
Senator Click Bishop, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Lyman Hoffman
Senator Donny Olson
Senator Natasha von Imhof
Senator Bill Wielechowski
Senator David Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Senator Roger Holland, Sponsor; Lucinda Mahoney,
Commissioner, Department of Revenue; Marcus Frampton, CIO,
Alaska Permanent Fund Corporation; Dan Stickel, Chief
Economist, Economic Research Group, Tax Division,
Department of Revenue.
SUMMARY
SB 132 CONTROLLED SUB. DATA: EXEMPT VETERINARIAN
SB 132 was REPORTED out of committee with seven
"do pass" recommendations and with on previously
published fiscal note: FN 1 (CED).
SB 235 NO STATE INVESTMENT IN RUSSIAN FEDERATION
SB 132 was HEARD and HELD in committee for
further consideration.
PRESENTATION: DEPARTMENT OF REVENUE, SPRING FORECAST
SENATE BILL NO. 132
"An Act exempting veterinarians from the requirements
of the controlled substance prescription database."
9:05:29 AM
SENATOR ROGER HOLLAND, SPONSOR, presented a brief
reintroduction of the bill. He stressed that veterinarians
were not required to be HIPPA compliant and should not be
required to participate in the prescription drug monitoring
program.
9:06:30 AM
Co-Chair Stedman looked at the fiscal note attached to the
bill. He read from the analysis:
SB 132 removes the requirement for Alaska-licensed
veterinarians to register with the states controlled
substance prescription database, commonly referred to
as the Prescription Drug Monitoring Program (PDMP). It
also removes the requirement for veterinarians to
review the animal owner's/caregiver's prescription
history in the PDMP before prescribing, administering,
or dispensing a federally scheduled II or III
controlled substance, as well as the reporting
requirement for submitting data on federally scheduled
II IV controlled substances. Under AS
17.30.200(d)(3), optional access by veterinarians
would be permitted.
If the bill passes the following expenses will be
incurred: Services: $1.7 (legal costs to amend
regulations, printing, and postage in first year)
Professional licensing programs within the Division of
Corporations, Business and Professional Licensing are
primarily funded by Receipt Supported Services, fund
source 1156 Rcpt Svcs (DGF). Licensing fees for each
occupation are set per AS 08.01.065 so the total
amount of revenue collected approximately equals the
occupation's actual regulatory costs.
Senator von Imhof MOVED to report SB 132 out of Committee
with individual recommendations and the accompanying fiscal
impact note. There being NO OBJECTION, it was so ordered.
SB 132 was REPORTED out of committee with seven "do pass"
recommendations and with on previously published fiscal
note: FN 1 (CED).
9:08:01 AM
AT EASE
9:10:18 AM
RECONVENED
SENATE BILL NO. 235
"An Act relating to certain investments of state funds
in the Russian Federation and financial institutions
profiteering from the Russian Federation's invasion of
Ukraine; providing indemnity and immunity for certain
investment actions taken in compliance with law; and
providing for an effective date."
9:11:13 AM
LUCINDA MAHONEY, COMMISSIONER, DEPARTMENT OF REVENUE,
discussed the presentation, "SB 235 Divestment Regarding
Russian Entities" (copy on file). She related that the
presentation would provide the committee with an overall
bill summary. She said that the intent of the bill was to
divest from certain investments in Russia and to establish
policies relating to companies that could potentially be
profiteering from buying and selling Russian securities on
the secondary market. She relayed the general subject
matter that would be discussed in the presentation.
9:13:20 AM
Commissioner Mahoney pointed to slide 2, "Alaskan Russian
Investments":
?SB 235 Bill Summary
?Sanctions and Status
?Market Overview
?Treasury Investments
?Actions by Institutional Investors
?Fiduciary Standards
Questioned and A
?Appendix A Additional slides presented to House State
Affairs on 3/10/22
Commissioner Mahoney looked at slide 3, "SB 235 Bill
Summary":
?Prohibits investment in and requires divestment of
Russian assets in funds subject to AS 37.10.
?Assets include all sovereign debt of the Russian
Federation and publicly traded securities of a company
identified by the United States Department of
Treasury, Office of Foreign Assets (OFAC).
?Provides for a 180 day exit from the assets once
identified.
?Divestment is not required for comingled funds, but
the fiduciary is required to request that fund
managers consider divestment annually on January 31.
Commissioner Mahoney explained that OFAC is a division
within the U.S. Treasury that had identified Russian
institutions that were close to Vladimir Putin and that has
a significant role in the Russian economy and were likely
to be financial contributors to the invasion of Ukraine.
She shared that all the institutions had been identified in
Federal Executive Order 14024, which was issued on February
24, 2022. She said that the state had elected to use this
federal guideline to identify the investments that should
be divested from; 13 major Russian firms had been
identified in the order with the overall goal to be to
cripple the core infrastructure of the Russian financial
system and inhibit Russias ability to continue to fund the
Ukraine invasion. She said that the as entities were added
or deleted to the list defined by OFAC, the state would add
or delete those entities from divestment. She spoke to the
180-day exit from identified assets and stated that there
was currently no exchange market for the state to conduct a
transaction and the valuations were uncertain and volatile.
She added that it was unclear how ownership would be
transferred or what would occur while the Society for
Worldwide International Financial Telecommunications
(SWIFT) system was shut down. She shared that a final
concern was how the state could be assured that the
divested investment would not be transferred to
unscrupulous entities.
9:17:20 AM
Senator von Imhof pointed to the second bullet point on
slide 2. She understood the date on which the list of
identified assets had been released from OFAC was February
24, 2022.
9:17:35 AM
Commissioner Mahoney agreed.
9:17:39 AM
Senator von Imhof asked what day Russia had invaded
Ukraine.
9:17:45 AM
Commissioner Mahoney did not have the information.
9:17:49 AM
Senator von Imhof believed that the dates were the same,
February 24, 2022. She wondered whether OFAC might have had
prior knowledge of the invasion to release the list of key
divestment securities on the same day of the invasion.
9:18:25 AM
Commissioner Mahoney continued to address slide 3:
?Precludes the Commissioner of Revenue or other
fiduciary from conducting business with banks who are
"profiteering" from the Russian invasion of Ukraine.
Commissioner Mahoney relayed that several weeks ago it had
been reported in several media networks that certain Wall
Street companies were profiteering from the invasion. She
said that under the legislation the state would determine
whether banks were profiteering from the invasion and
consider seeking alternative financial partners.
9:20:13 AM
Co-Chair Stedman wondered whether short sales firms working
in derivative markets were including in profiteering
considerations.
9:20:30 AM
Commissioner Mahoney replied that if the state became aware
that companies were profiteering from the invasion the
state would conduct due diligence to determine whether to
continue to do business with the entity.
9:20:50 AM
Co-Chair Stedman assumed that included large Wall Street
firms and large banks.
9:20:56 AM
Commissioner Mahoney replied in the affirmative.
9:21:04 AM
Senator Wielechowski noted that profiteering was defined in
the bill as making an excessive or unfair profit. He
wondered if the administration was okay with doing business
with companies that were making a mediocre profit off the
of the invasion.
9:21:28 AM
Commissioner Mahoney replied that the bill did not
specifically define profiteering as making a certain
percentage. She said that a figure would be established and
developed in policy and would reflect the day-to-day
changes of the market.
9:22:04 AM
Senator Wielechowski wondered whether the administration
would be amenable to the legislature setting policy that
making any profit at all off the invasion would be
verboten. He asserted that the position of the state should
be that no profit at all should be made from the killing of
the Ukrainian people.
9:22:28 AM
Commissioner Mahoney replied that the administration would
be open to amendments to the legislation.
9:22:36 AM
Senator von Imhof wondered whether a hedge fund bet long or
short on an oil stock would that be addressed under the
legislation.
9:23:02 AM
Commissioner Mahoney replied that it would depend on
whether the stock was involved with funding the invasion,
meaning it was a Russian entity that potentially would be
profiting to fund the war.
9:23:23 AM
Senator von Imhof noted that there was a 180-day exit time
once assets had been identified. She offered a hypothetical
of several traders from Goldman Sachs trading in oil stock
and asked whether the state would divest from the bank
under the legislation.
9:23:49 AM
Commissioner Mahoney asked for a restatement of the
question.
9:24:00 AM
Senator von Imhof restated her question. She wanted to
understand how far reaching the bill went in terms of
determining which companies to divest from.
9:25:18 AM
Commissioner Mahoney replied that she could not speak to a
scenario until she understood the specifics, which were
everchanging. She said that the intent was to do due
diligence with companies and then determine whether there
was a suitable alternative for the services provided by the
company.
9:27:10 AM
Senator von Imhof understood the intent of the bill but
felt that the practical evaluation and execution would
result in some grey area.
9:27:35 AM
Commissioner Mahoney assured the committee that she
intended to follow the intent of the bill and do her
fiduciary duty to the state.
9:28:00 AM
Co-Chair Bishop spoke of the countrys history of
divestment during wartime. He stressed that the right thing
to do was to divest.
9:29:08 AM
Senator Wielechowski cited page 4 of the bill and the
definition of profiteering as otherwise seeking financial
gain in the purchase or sale of Russian sovereign debt. He
cited the bills definition of Russian sovereign debt, a
debt instrument that is issued by the government of
Russia. He pointed out that in other areas of the bill the
term Russian Federation was used. He wondered whether the
use of both Russian Federation in some areas, and
Russian Government in others, was intentional or a
drafting error.
Commissioner Mahoney believed that it was a drafting error.
Senator Wielechowski understood that the definition of
Russian sovereign debt should read a debt instrument that
is issued by the Russian Federation.
Commissioner Mahoney replied that she would need to
research the issue further before providing an answer.
9:30:03 AM
Senator Wilson discussed the final bullet point on slide 3.
He wondered about the vetting process used to determine
businesses that might be profiteering or may be doing
business with other businesses that might be profiteering.
9:30:31 AM
Commissioner Mahoney said a questionnaire would be
developed for companies reportedly profiteering by the
media. The questionnaire would query business practices and
associations. Responses to questions would trigger a search
for alternative providers of financial services and could
possibly result in the state changing providers.
9:31:25 AM
Senator Wilson wondered how the legislation would impact
the mission of the treasury division.
9:31:32 AM
Commissioner Mahoney responded that the goal was not to
negatively impact or violate current fiduciary duties, but
to identify alternative provider of the same service. If no
alternative providers were available, the state would
continue to work with the entity while communicating
dissatisfaction with that entitys profiteering on the
invasion in Ukraine.
9:32:12 AM
Senator Olson asked whether the divestment could be
extended to allies of Russia, such as Belarus.
9:32:32 AM
Commissioner Mahoney stated that the idea had not been
considered in the legislation.
9:32:51 AM
Co-Chair Stedman spoke to Senator Wielechowskis question.
He did not think that the treasury had much exposure to
Russian investments. He felt that the aggregate dollars
that the treasury had under management, compared to the
dollars exposed to Russia, were minimal. He thought that
those assets could be held in cash.
9:33:38 AM
Commissioner Mahoney replied that the amount that the
treasury had currently invested was $7 million, which was
minimal. She stated that treasury would be impacted by the
portion of the bill that addressed profiteering; when the
state was buying and selling bonds, they would scrutinize
companies that could be potentially profiteering, which she
believed was significant.
9:34:22 AM
Co-Chair Stedman understood that the commissioner was
referring to the bond underwriter.
9:34:50 AM
Commissioner Mahoney replied in the affirmative.
9:35:09 AM
Co-Chair Stedman understood that when companies went to
issue or create bonds, if they had exposure to the Russian
Federation, the state would no longer do business with
them.
9:35:45 AM
Commissioner Mahoney reiterated that the state would
evaluate whether there was an available alternative company
to work with, then may cease doing business with the
company.
9:36:09 AM
Co-Chair Stedman thought that they were discussing two
separate issues: buying and selling a bond portfolio and
bond issuance. He noted the various bond issuance
activities in the state. He requested clarity in the
discussion between bond issuance and bond trading.
9:36:57 AM
Commissioner Mahoney agreed that the issues should be
clear. She said that she was not addressing geo bonds or
municipal bank bonds but rather the issuance of bonds by
various companies throughout the U.S.
9:37:14 AM
Senator Wielechowski understood that if Goldman Sachs was
found to be profiteering the state would no longer do
business with them.
9:37:38 AM
Commissioner Mahoney explained that if Goldman Sachs was
found to be profiteering, the state would try to work with
other managers in a manner that would not compromise the
states fiduciary duty.
9:38:09 AM
Senator Wielechowski asked what the commissioner meant by
try to.
9:38:24 AM
Commissioner Mahoney replied that there would be an
evaluation of the bond issuance fee structure, and assuming
that the fees were the same the state would switch to a
non-profiteering company. The bill stated that the state
would identify at least three alternative companies to
choose from. She reiterated that fiduciary duty would guide
the ultimate choice the state would make concerning
divestment.
9:39:01 AM
Senator Wielechowski wondered whether the bill would
prohibit the Alaska Permanent Fund Corporation (APFC) or
the Alaska Retirement Management Board (ARMB) from
profiteering off the of the invasion of Ukraine.
9:39:15 AM
Commissioner Mahoney replied that the bill excluded,
specifically, APFC and ARMB.
9:39:22 AM
Senator Wielechowski understood that both entities could
legally invest in companies that were making chemical
weapons, bombing Ukraine, tied to oligarchs, tied to senior
political leaders, and making and excess or unfair profit
off the war in Ukraine.
9:39:56 AM
Commissioner Mahoney responded that neither of those
entities would do anything to violate U.S. sanctions, but
the bill did not specifically address those entities.
9:40:13 AM
Senator Wielechowski probed whether the commissioner was
aware of the APFC investing in companies that were
currently in the U.S. Treasury sanction list.
9:40:21 AM
Commissioner Mahoney replied in the affirmative.
9:40:34 AM
Senator Wielechowski wondered whether it was appropriate
that the APFC and ARMB were investing in at least 17
different companies that were currently sanctioned by the
U.S. Treasury because they were tied to oligarchs and
senior political figures within the Putin Administration.
9:40:58 AM
Commissioner Mahoney replied that she did not personally
believe it was appropriate. She added that the APFC and
ARMB were independent boards, and the governor wanted the
bill to address the investments that excluded the two
boards.
9:41:23 AM
Senator Wielechowski understood that the state had roughly
$300 million invested in Russia. He asked how much of that
was invested in the APFC and ARMB.
9:41:39 AM
Commissioner Mahoney replied that there was a summary on
slide 13 of the investments. She said that the total
investment totaled $333 million, with most of it being in
stocks ($267 million) which was majority owned by the APFC
at $153 million.
9:42:33 AM
Senator von Imhof noted that the commissioner had repeated
the phrase compromise fiduciary responsibility several
times and wondered what that meant.
9:43:08 AM
Commissioner Mahoney replied that it was difficult to
answer the question because of the everchanging market. She
stressed that the state could not divest from closed
markets but them could come a time when the decision could
be made about monetization versus growth.
9:44:11 AM
Senator von Imhof surmised that holding on action with
direct investments made sense. She wondered about bond
sales. She asked if a bond middleman with ties to Russia
offered a sale with minimal fees, versus one who had no
Russian ties but who would charge a higher rate, which
would the treasury choose.
9:44:58 AM
Commissioner Mahoney replied that it would be an unusual
situation where a bond reseller would offer services for
free. She could not respond to the question.
9:45:26 AM
Co-Chair Stedman spoke to the list of assets mentioned by
Senator Wielechowski and wondered about the timeline of
purchasing of those assets. He thought more detail on
purchases would be helpful.
9:47:00 AM
MARCUS FRAMPTON, CIO, ALASKA PERMANENT FUND CORPORATION,
related that immediately after the invasion of Ukraine the
corporation issued a no-buy order on securities. He said
that most were securities that had been long held and
through external managers.
9:48:37 AM
Senator Wielechowski spoke to the $219 million in the APFC
and Mental Health reflected on slide 13, and the $94
million in the ARMB, which together comprised 90 percent of
Alaskas investment in Russian assets that would not be
affected by the legislation.
9:49:03 AM
Commissioner Mahoney agreed.
9:49:35 AM
Commissioner Mahoney discussed slide 4, "SB 235 Bill
Summary (continued)":
? May allow investments if not doing so would be
inconsistent with applicable fiduciary
responsibilities but requires at least three
alternative investment opportunities to be considered.
? Excludes Alaska Permanent Fund Corporation (APFC)
and the Alaska Retirement Management Board
(ARMB), allowing divestment decisions by these
entities' boards.
? Exempts those taking divestment actions or
inactions, in good faith, from liability for doing so.
? Provides reporting mechanisms to the Legislature as
to the divestment activity undertaken.
? Expires on July 1, 2023.
9:50:40 AM
Co-Chair Bishop surmised that that the anticipation was
that the war would be over by 2023.
9:51:04 AM
Commissioner Mahoney said that was the hope but that the
administration would come before the legislation to change
the expiration date if need be.
9:51:13 AM
Senator Wilson understood that it took 180 days to exit the
market and the bill expired in 2023. He felt that that
would result in only 6 months of divestment. He wondered
whether the bill was only posturing.
9:52:18 AM
Commissioner Mahoney replied that the goal of the bill was
to show support to the policies of the federal government.
It was a show of solidarity with Ukraine against Russia.
9:53:17 AM
Senator Wilson understood the intent of the bill.
9:53:40 AM
Senator von Imhof appreciated the intent of the bill but
thought it was unenforceable. She noted that someone was
going to buy the assets the that states divested from.
9:54:48 AM
Co-Chair Stedman assumed the $219 in assets held by APFC
would be at cost He felt that the percent of movement
exceeded $219 million from day to day. He wondered whether
the corporation could cut all ties to Russian investment
entirely.
Mr. Frampton said that the stocks were currently minimal.
Co-Chair Bishop clarified that he was talking about Russian
stocks.
9:56:31 AM
Mr. Frampton said that Russian stocks were worthless. He
thought that the market would develop and offered several
what if scenarios to the effect.
9:57:44 AM
Co-Chair Bishop asked whether a market could emerge that
would need to be monitored for profiteering.
Mr. Frampton thought the term "profiteering" was
subjective.
9:59:05 AM
Senator Wielechowski took issue with the statement that the
bill indicated the state stood with Ukraine. He pointed out
that 90 percent of the states current assets invested in
Russia were exempt under the legislation. He stressed that
the bill allowed the ARMB and the APFC, through one of the
largest sovereign wealth funds in the world, to profiteer
from the invasion of Ukraine. He argued that the bill was
toothless and wondered why it was being considered.
AT EASE
10:00:03 AM
RECONVENED
10:00:58 AM
Co-Chair Bishop discussed the timeline to continue the
conversation.
10:01:43 AM
Senator Olson asked whether the presenter agreed with
Senator Wielechowski's assessment of the legislation.
Commissioner Mahoney thought that the bill showed
unification with the federal governments policies. She
believed that all divestments added up. She admitted the
divestment amount was small.
Senator Olson noted that 90 percent of the $7 billion
invested in Russia would not be subject to the legislation.
10:03:06 AM
Commissioner Mahoney said that the $7 billion would be
subject to the profiteering component of the bill.
Co-Chair Stedman though the total was $7 million.
Commissioner Mahoney clarified that $7 billion was the
total in state assets, $7 million was the valuation of the
investment is in Russia.
Co-Chair Bishop requested further clarification.
Commissioner Mahoney clarified that there was $7 billion
invested in total - $7 million invested in Russia prior to
the decline in valuations.
10:04:27 AM
Commissioner Mahoney pointed to slide 5, "Unprecedented
Global Sanctions":
Banks and Financial Services
?Russian Central Bank restrictions imposed by US,
UK, Canada and EU
?Swift ban enacted on seven Russian banks
?Sanctions imposed on Sberbank and VTB Bank,
Russia's largest banks
?US persons prohibited from investing in new debt
or equity issuance from certain OFAC Russian
institutions
Oil and Gas
?US bans import of Russian energy products
including oil, liquified natural gas, and coal
Corporate
?Over 300 companies have withdrawn from Russia
including Boeing, Airbus, Visa, Mastercard,
FedEx, UPS, Apple, Netflix, and McDonalds
?Google, Meta (Facebook), and TikTok have blocked
Russian state media channels
?BP, Shell, Exxon, and Equinor are divesting from
billions in oil and gas developments
Other
?US bans Russian aircraft from US airspace
?Foreign held asset freeze and travel bans for
some politicians, officials, oligarchs and family
members
Commissioner Mahoney thought the committee was familiar
with the current sanctions.
10:06:43 AM
Commissioner Mahoney looked at slide 6, "Current Status of
Russian Equity Investments":
?Russian equities decreased by 53 percent in value in
February.
?Trading halted on February 25th for all Russian
listed equities.
?Valuations are now highly speculative since they are
no longer provided by the market.
?All major stock indexes are taking Russian securities
out this month and passive index funds are holding
Russian securities at low to no value.
10:07:26 AM
Commissioner Mahoney discussed slide 7, "International
Equity in Russia":
? Most institutional investors invest in a diverse
basket of global securities.
? The Morgan Stanley All-Country World Index
Investable Market Index (MSCI ACWI IMI) is a common
institutional index that incorporates 99 percent of
globally publicly traded equities.
? The index is diversified across 48 countries 23
developed and 25 emerging market and includes roughly
9,300 securities.
? The index is a reasonable proxy for many
institutional investor portfolios
Commissioner Mahoney pointed out the amount of equity
benchmark comprised by Russia. She noted that the largest
area was in energy.
10:08:17 AM
Commissioner Mahoney addressed slide 8, "Treasury Russian
Equity Investments 1/31/22":
Treasury Russian equity investments 0.23 percent of
$50.6 billion in assets:
State Investments 0.10 percent of $7.7 billion in
assets
? 0.10 percent of state assets had Russian equity
exposure on 1/31/22 ($7.4 million).
? 1 passive/index investment manager.
Defined Benefit Retirement Systems, 0.28 percent of
$33.9 billion in assets
? 0.28 percent of the retirement funds had
Russian equity exposure on 1/31/22 ($93.5
million).
? 7 investment managers 4 active, 3
passive/index.
Participant Directed, 0.15 percent of $9.0 billion in
assets
? 0.15 percent of participant directed assets had
Russian equity exposure on 1/31/22 ($13.4
million).
? 4 investment managers 2 managers active, 2
passive/index funds.
? All of the Russian exposure is through
commingled funds where the ARMB is not the direct
fiduciary for the funds.
Treasury has directed a halt to the purchase of
Russian securities at this time due to illiquidity and
risk uncertainty.
10:09:38 AM
Commissioner Mahoney looked at slide 9, "What are others
doing?"
States
? Research and surveys administered by The
Pennsylvania Treasurer show that as of 3/12/22, there
were a total of 37 states currently looking into or
currently freezing state money or pension funds going
to Russian companies, investments or oligarchs.
? Other actions taken by other states include the
following:
? Looking into or currently banning state agencies
from doing business with Russian state owned firms and
subcontractors.
Blocking Russian businesses and nonprofits from
acquiring property in their state for 1 year.
Looking into or ending sister state
relationship with Russia.
Officially condemned Russia's invasion.
Welcoming refugees.
Calling on businesses to ban Russian made
goods.
Norway Sovereign Wealth Funds
Norway announced that they are divesting from
Russia.
Russian assets at the end of 2021 made up 0.2
percent of Norway fund ($3 billion in total).
Recognize that divestment takes time because
they want to ensure sales are not made to
sanctioned individuals/entities.
10:12:01 AM
Senator Hoffman asked about Norway and whether they would
stop investing in Russia only for the duration of the war.
Mr. Frampton said that a law had been passed in Norway that
banned investment in Russia.
10:13:06 AM
Senator Wielechowski asked whether the APFC would support
an amendment that prohibited the corporation to invest in
Russian assets.
Commissioner Mahoney said that such an action would take a
vote of the trustees.
Senator Wielechowski noted that the commissioner was a
trustee on the board and asked whether she would support an
amendment.
10:13:48 AM
Commissioner Mahoney replied that she personally believed
that Russian investments would not be a good choice for the
board to make at this time.
10:14:12 AM
Commissioner Mahoney addressed slide 10, "Guiding Statutes
for Investing":
? Prudent Investor Rule Summary
? In additional to other considerations, a
fiduciary shall exercise the judgment and care
under the circumstances then prevailing that an
institutional investor of ordinary prudence,
discretion, and intelligence exercises in the
management of large investments.
? ARMB/Treasury Statutes
? AS 37.10.071(c) In exercising investment,
custodial, or depository powers or duties under
this section, the fiduciary of a state fund shall
apply the prudent investor rule and exercise the
fiduciary duty in the sole financial best
interest of the fund entrusted to the fiduciary.
Among beneficiaries of a fund, the fiduciaries
shall treat beneficiaries with impartiality.
? AS 37.10.210(a) Consistent with standards of
prudence, the board has the fiduciary obligation
to manage and invest these asset s in a manner
that is sufficient to meet the liabilities and
pension obligations of the systems, plan,
program, and trusts.
? APFC Statutes
? 37.13.120. Investment responsibilities. (a) The
board shall adopt regulations specifically
designating the types of income producing
investments eligible for investment of fund
assets. When adopting regulations authorized by
this section or managing and investing fund
assets, the prudent investor rule shall be
applied by the corporation. The prudent investor
rule as applied to investment activity of the
fund means that the corporations hall exercise
the judgment and care under the circumstances
then prevailing that an institutional investor of
ordinary prudence, discretion, and intelligence
exercises in the designation and management of
large investments entrusted to it, not in regard
to speculation, but in regard to the permanent
disposition of fun ds, considering preservation
of the purchasing power of the fund over time
while maximizing the expected total return from
both income and the appreciation of capital.
10:15:32 AM
Co-Chair Stedman looked at the first bullet. He considered
the Prudent Investor rule and noted that the committee was
not an institutional investor and followed the Prudent Man
Rule, which was the forerunner of the Prudent Investor
Rule. He shared that the two rules varied as the Prudent
Man Rule might consider the divestment from Russian
investments something that should happen more immediately
before the implementation of nerve gasses or nuclear
weapons by the Russian Federation. He thought that action
should be swift and final concerning divestment from
Russian assets.
10:17:43 AM
Commissioner Mahoney suspected that the trustees of both
boards would likely agree. She said that public testimony
would need to be taken and that the public sometimes
testified in favor of divestment from various entities. She
wondered where the boards could draw the line about when to
divest and remain independent and not influenced by social
events. She reiterated that she, personally, was in support
of divestment from Russia.
10:19:26 AM
Co-Chair Stedman thought that there was an obvious
difference between a group in society that might want to
invest in carbon neutral companies or divest from companies
that endangered the environment, and the burning and
shelling of entire cities, the bombing of hospitals, and
the bombing of bomb shelters full of children. He contended
that under those circumstances the decision to divest was
not a difficult one.
10:20:11 AM
Senator von Imhof noted that the APFC had not held a
meeting since February 24, 2022. She assumed that there had
been meetings with the Department of Revenue and the
governor to craft the bill. She wondered whether it made
sense that the board might meet to discuss the bill.
10:20:44 AM
Commissioner Mahoney replied in the affirmative.
10:20:51 AM
Senator von Imhof asked whether the APFC wanted the
legislature to provide guidance to the board regarding
divestment from Russian assets.
10:21:07 AM
Commissioner Mahoney replied that the bill specifically
excluded the two funds because of their independent nature
and the importance of following statue and maintaining
fiduciary duty. She said that there could be trustees that
did not have the same opinion as she and the members of the
committee. She thought that a meeting could take place for
the board to vote on the issue and after the vote the
legislature could weigh in on the matter.
10:22:15 AM
Senator von Imhof recalled the commissioners comments
about public comment on the divestment or investment in
environmental or social issues and that the legislature
might provide some guidance to the APFC on social
investing. She felt that the legislature would oblige in
providing guidance to the board.
10:22:59 AM
Senator Wielechowski agreed with Senator von Imhofs
comments and welcomed the possibility of providing guidance
to the board some baseline of standards for investment. He
asked whether the corporation wanted suggestions from the
legislature or would they rather handle to issue in-house.
10:24:04 AM
Commissioner Mahoney replied that she was one of six
trustees but stated that it was an important issue to be
discussed by the board. She replied that the board follows
the fiduciary duty outlined in statute.
Co-Chair Bishop asked whether APFC quit investing on the
day of the invasion of Ukraine, or had they pulled out in
advance.
10:25:20 AM
Mr. Frampton replied that many of the Russian investments
were managed by external managers. Those managers had
discretion to divest. He did not have exact numbers but
shared that Russian values were in decline in January 2022,
and that investments had declined soon after the invasion.
SB 235 was HEARD and HELD in committee for further
consideration.
10:26:40 AM
AT EASE
10:29:16 AM
RECONVENED
Co-Chair Bishop handed the gavel to Co-Chair Stedman. Co-
Chair Stedman cited a response letter from the department
dated March 10, 2022, that responded to questions from the
previous forecast. (copy on file)
^PRESENTATION: DEPARTMENT OF REVENUE, SPRING FORECAST
10:30:33 AM
DAN STICKEL, CHIEF ECONOMIST, ECONOMIC RESEARCH GROUP, TAX
DIVISION, DEPARTMENT OF REVENUE, discussed the
presentation, "Spring 2022 Forecast Presentation Senate
Finance Committee" (copy on file).
10:30:49 AM
Mr. Stickel looked at slide 2, "Agenda":
1. Forecast Background, Economic Indicators, and Key
Assumptions
2. Spring 2022 Revenue Forecast
?Total State Revenue
?Unrestricted Revenue
3. Petroleum Forecast Assumptions Detail
?Oil Price
?Oil Production
?Oil and Gas Lease Expenditures
?Oil and Gas Transportation Costs
?Oil and Gas Credits
10:31:11 AM
Mr. Stickel pointed to slide 4, "Background: Spring Revenue
Forecast":
1. Historical, current, and estimated future state
revenue
2. Updates key data from Fall Revenue Sources Book
3. Official revenue forecast used for final budget
process
4. Located at tax.alaska.gov
10:32:01 AM
Mr. Stickel addressed slide 5, "Key Economic Indicators."
The slide detailed the indicator units on an annual and
quarterly basis. He stated that the GDP had been stable
th
over the last year. The 4 quarter of 2021 will be released
on March 31, 2022, and will be the first quarter that
reflects higher oil prices. He relayed that employment went
up 2 percent in 2021, as well as the first month of 2022.
He lamented that the numbers were still down 50,000 from
July 2019. He stated that wages and salaries had largely
recovered from the pandemic and bankruptcies, foreclosures
and mortgage delinquencies were holding at low levels. He
shared that 2021 ended in pre-pandemic levels for housing
starts.
10:34:46 AM
Mr. Stickel pointed to slide 6, "Spring Forecast
Assumptions":
? The economic impacts of COVID-19 and geopolitical
events are uncertain; DOR has developed a plausible
scenario to forecast these impacts.
? Key Assumptions:
o Investments: Stable growth in investment
markets, 5.86 percent for FY 2022 and 6.20
percent for FY 2023+.
o Federal: The forecast incorporates stimulus
funding as of March 1, 2022, includes updated
estimates of IIJA funding.
o Petroleum: Alaska North Slope oil price of
$91.68per barrel for FY 2022 and $101.00 per
barrel for FY 2023.
o Non-Petroleum: Continued economic growth. 75
percent of capacity assumption for 2022 cruise
season, minerals prices based on futures markets.
10:35:20 AM
Mr. Stickel looked at slide 7, Relative Contributions to
Total Revenue: FY 2021:
Total State Revenue: $29.8 Billion
Investment Earnings; 65.8 percent
Federal Revenue: 25.4 percent
Petroleum: 5.4 percent
Other Revenues: 2.6 percent
Non-Petroleum Corporate Income: 0.4 percent
Fisheries: 0.3 percent
Tourism: 0.1 percent
Mining: 0.1 percent
Mr. Stickel discussed slide 8, Relative Contributions to
Total State Revenue: FY 2023:
Total State Revenue: $16.4 Billion
Petroleum: 31.4 percent
Federal Revenue: 31.2 percent
Investment Earnings: 30.0 percent
Other Revenues: 4.7 percent
Non-Petroleum Corporate Income: 0.8 percent
Fisheries: 0.7 percent
Tourism: 0.6 percent
Mining: 0.5 percent
10:36:29 AM
Senator von Imhof remarked that slide 8 and slide 7. She
wondered what had been included in the $29.8 billion
revenue total on slide 7.
10:36:53 AM
Mr. Stickel replied that there was a detail on slide 11.
10:37:07 AM
Mr. Stickel looked at slide 10, Unrestricted Revenue
Forecast: FY 2021 and Changes to Two-Year Outlook. The
slide summarized the key changes between the fall 2021 and
spring 2022 revenue forecasts. He said that Alaska North
Slope Oil (ANS) price increased by approximately $16/bbl
for FY 22 and $30/bbl for FY 23, which was related to
continued recovery and stabilization in the oil markets as
they recovered from the pandemic. He added that the Russian
invasion of Ukraine had cause oil prices to spike just as
the spring forecast was being finalized. He related that
the total forecast of UGF had increased by $1.2 billion in
FY 22, and $2.4 billion for FY 23 driven by the increase
in oil price.
10:38:22 AM
Co-Chair Stedman queried the data point for where the price
would be to be above or below the revenue projection.
10:38:38 AM
Mr. Stickel replied that for FY 22 the forecast
incorporated 8 months of actual prices through the end of
February 2021. He furthered that the average of March
through June was in the range of $114/bbl.
10:38:58 AM
Co-Chair Stedman understood that the $114/bbl was used on
the performance side as a benchmark for revenue projections
for FY 22.
10:39:13 AM
Mr. Stickel replied in the affirmative.
10:39:23 AM
Senator Hoffman thought that the current price of oil was
$108/bbl. He understood that the U.S. was no longer
importing Russian oil and that the NATO Nations were
considering following suit. He wondered whether the oil
forecast remained the same with the exit of the NATO
Nations.
10:40:07 AM
Mr. Stickel replied that his forecast was based on the
futures market. He said that the issue would be addressed
on future slides.
10:40:19 AM
Mr. Stickel looked at slide 11, which looked at the total
state revenue for FY 21 and the forecast for FY 22 and FY
23. He said the unrestricted general fund (UGF) would be
discussed for most of the presentation. The slide included
UGF, designated general fund (DGF), Other Restricted
Revenue, and Federal Revenue. Total State revenue in FY 21
was $29,765.6. He said that FY 22 and 23 were projected to
be $15,783.1 and $16,435.4 respectively. He noted the FY 21
had two significant one-time impacts of the banner year of
the return on the permanent fund and federal stimulus
money.
10:41:58 AM
Co-Chair Stedman noted the permanent fund was calculated on
a five-year basis at 5 percent of market value and varied
from year to year. He thought that this footnote could be
added to the slide.
10:42:50 AM
Senator von Imhof asked whether the $16.2 billion in
investment revenue was realized or unrealized.
10:43:02 AM
Mr. Stickel replied that it was both. He explained that the
transfer to the general fund from the permanent fund, 5.25
percent of the trailing average market value for 2021, was
shown a UGF and gains above and beyond that transfer was
shown as other restricted general fund revenue.
10:43:35 AM
Senator von Imhof understood that unrealized meant that the
fund had gained on paper but had not been sold to realize
the gain. She thought an FY 20 column would reflect a
significant market drop due to Covid-19.
10:44:27 AM
Mr. Stickel replied that the spring FY 20 forecast had
reflected downward markets, which rebounded towards the end
of the fiscal year.
10:44:52 AM
Mr. Stickel looked at slide 12, Unrestricted Revenue
Forecast: FY2021 to FY 2023 Totals, which detailed the
four main sources for unrestricted revenue: Investment
Revenue Alaska Permanent Fund, Investment Revenue Other
Investments, Petroleum Revenue, Non-Petroleum Revenue,
their history and forecast for FY 22 and FY 23.
10:45:21 AM
Mr. Stickel pointed to slide 13, Unrestricted Investment
Revenue: FY 2021 to FY 2023 Totals. The slide detailed the
investment sources the largest of which was the Alaska
Permanent Fund, but also included other investments
totaling $3,120.9 historically, and $3,064.6 and $3,376.6,
respectively, for FY 22 and FY 23.
10:46:04 AM
Mr. Stickel pointed to slide 14, "Unrestricted Investment
Revenue: Percent of Market Value (POMV) Transfer Forecast":
? Permanent Fund total return for FY 2021 of 29.7
percent.
?The statutory POMV rate changed to 5 percent
beginning FY 2022.
?For FY 2019 FY 2021 this rate was 5.25 percent.
?Forecast assumes Permanent Fund's long-term total
return expectation of 6.20 percent for FY 2023+; 5.86
percent for FY 2022.
?Differing Permanent Fund returns and petroleum
deposits could significantly alter actual POMV
amounts.
The slide showed a chart of the estimated percent of market
value (POMV) transfer to the general fund over the next 5
years.
10:46:39 AM
Mr. Stickel looked at slide 15, Unrestricted Petroleum
Revenue: FY 2021 to FY 2023 Totals. He listed the main
sources of the taxes, Petroleum Property Tax, Petroleum
Corporate Income Tax, and the Oil and Gas Production Tax.
He said that the CARES legislation had allowed companies to
carry back certain losses for 2018, 2019, and 2020, which
Alaska adopted into the tax code. He estimated $2.4 million
in FY 2021, and $79.4 million in FY 22 for the CARES act
refunds, which were baked into the forecast. He expected
positive income for corporate income tax moving forward. He
thought that given the higher price forecast it was
expected that the production tax revenue would be higher
over the next two fiscal years.
10:48:33 AM
Senator Wielechowski wondered if the production corporate
income tax in FY 22 and FY 23 would change if all the
operating oil companies on the North Slope were exclusively
C corporations.
10:48:45 AM
Mr. Stickel replied that roughly 70 percent of oil and gas
production in the state was from C corporations, so the
expected change would be that the total revenue would be
higher by approximately $100 million per year.
10:49:08 AM
Co-Chair Stedman asked what number for the price of oil was
used in the C corp/S corp calculation.
10:49:14 AM
Mr. Stickel replied that the figure would be based on the
Spring Forecast.
10:49:26 AM
Co-Chair Stedman understood that was $101/bbl for FY 22 and
FY23.
10:49:34 AM
Mr. Stickel replied that there was not a company-specific
confidential detail that would be subject of the tax. They
would scale up to 100 percent what the department was
forecasting for the companies that represented 70 percent
of production, which was projected at $340 million.
10:49:59 AM
Senator Wielechowski remarked that the department had
testified earlier that S corp provisions were costing the
state between 80 and $100 million under the old forecast of
$71/bbl oil. He felt at higher per barrel oil costs would
increase the expense to the state for S corps.
10:50:33 AM
Mr. Stickel agreed to provide that information.
10:50:45 AM
Mr. Stickel pointed to slide 16, Unrestricted Non-
Petroleum Revenue: FY 2021 to FY 2023 Totals, which
outlined some of the sources of non-petroleum revenue. Mr.
Stickel shared that the largest component of non-petroleum
revenue was taxes, and the slide detailed the FY 21 through
FY 23 numbers on the following:
Fisheries Taxes
Insurance Premium Tax
Marijuana
Mining License Tax
Motor Fuel (Refund Fuel Surcharge)
Non-Petroleum Corporate Income
Tobacco
Other Taxes
Mr. Stickel relayed that Corporate Income Tax was typically
the largest funding source on the non-petroleum side. He
noted that estimates for CARES act allowance for carry-back
losses on non-petroleum revenue were expected at $6.7
million in FY 21, $79.5 million in FY 22. He said that the
stat expected only $15 million in corporate income tax in
FY 22, growing to $125 million in FY 23. He noted that
strong mineral prices suggested a significant increase in
mining taxes in FY 23.
10:52:10 AM
Co-Chair Bishop wondered whether the Cruise Ship Gambling
Tax would be included in Other Taxes.
10:52:20 AM
Mr. Stickel responded that that tax was in the unrestricted
category and would fall under the Other Taxes column.
10:52:43 AM
Senator Hoffman asked whether the elimination of the Motor
Fuel Tax required passage of legislation to implement the
zero tax.
10:52:58 AM
Mr. Stickel clarified that the Motor Fuel (Refined Fuel
Surcharge) line reflected only the Refined Fuel Surcharge,
which was not expected to go to zero but to be
reclassified from unrestricted to designated.
10:53:29 AM
Mr. Stickel discussed slide 18, Petroleum Detail: Changes
to Long-Term Price Forecast, which was a comparison of the
fall and spring forecasts. He noted a change had been made
in the forecasting of oil prices in fall 2022; two years of
features market outlook had previously bee used to
forecast, the shift in the fall had been to use features
market outlook for as many years a s was available. He
shared those prices had fluctuated since the forecast had
been produced.
10:54:49 AM
Co-Chair Stedman remarked that there would be a significant
difference in the calculations due to the volatility of the
market.
10:55:18 AM
Senator von Imhof wondered how long the price would remain
above $100/bbl. She asked whether $101/bbl had been used in
the projections while the market was so historically
volatile.
10:56:04 AM
Mr. Stickel noted that $101/bbl was an average over the
fiscal year. He said that monthly average prices had been
incorporated and the market suggested that prices would
start the fiscal year over $100/bbl and end under $100/bbl.
He agreed there was significant uncertainty surrounding the
forecast and the current time-period was one of the most
volatile since the beginning of the pandemic. He
characterized the forecast as a most likely within a range
of uncertainty.
10:56:56 AM
Senator Hoffman understood that 600,000 barrels per day had
had been previously purchased in Russian oil. He wondered
how significant the ending of purchasing of Russian oil was
and whether the state would eventually resume the
relationship with Russia.
10:57:49 AM
Mr. Stickel remarked that there was no explicit forecast of
Russian crude and Russian crude purchases. He said that the
run-up in prices since April 2020 there had been a
situation where demand had rebounded strongly form the
pandemic while supply had been slower to catch up with the
demand. This had been the fundamental driver behind
increased oil prices and the Russian situation had added to
the equation.
10:58:27 AM
Senator von Imhof believed that a fiscally conservative
approach would be to spend conservatively in FY 23.
10:59:02 AM
AT EASE
10:59:29 AM
RECONVENED
10:59:35 AM
Co-Chair Stedman discussed the timeline for the duration of
the meeting. He hoped Mr. Stickel could remain to finish
the presentation.
Mr. Stickel stated he was happy to oblige.
11:00:03 AM
Mr. Stickel pointed to slide 19, Petroleum Detail: Nominal
Brent Forecasts Comparison as of March 21, 2022. He noted
that the slide had been update the previous day to
incorporate the most recent future market projections as of
close of business. He pointed out to the committee the
states proximity to the futures market projections.
11:00:59 AM
Co-Chair Stedman spoke of fluctuating oil prices and asked
whether the numbers on the slide would change if the oil
price went down $20 in the next two weeks or were the
futures markets static.
11:01:34 AM
Mr. Stickel agreed that there had been a lot of volatility
around the numbers for FY 22 and FY 23. He said that the
later years looked more stable at a price hovering in the
$70/bbl.
11:02:05 AM
Mr. Stickel looked at slide 20, Petroleum Detail: UGF
Relative to Price per Barrel (without POMV): FY 23. He
offered that the side explored the question of how higher
or lower oil prices would affect the UGF.
11:02:45 AM
Co-Chair Stedman asked Mr. Stickle to discuss the expense
level and how the state would fare under the governors
fiscal plan for FY 23.
11:03:10 AM
Mr. Stickel agreed to provide the information to the
committee.
11:03:37 AM
Co-Chair Stedman requested a breakdown of the incremental
build up and a prioritization of expenditures.
11:04:11 AM
Mr. Stickel looked at slide 21, Petroleum Detail: North
Slope Petroleum Production Forecast. He explained that the
slide reflected the high and low case oil production for
the north Slope over the next 10 years. The slide was
created I collaboration with the Department of Natural
Resources (DNR), which could speak to any nuances in the
production forecast. He shared that the general outlook was
expected stable to slightly increased production, reaching
535,000/bbl by FY 2030.
11:04:58 AM
Co-Chair Stedman asked for further detail on FY 23 and FY
24 and the high and low expected numbers for those years.
He noted that FY 23 had a steeper incline on the positive
side and thought that the projections could be tracked in
real-time. He said that price was of concern to committee
members as volume was more easily predicted.
11:06:20 AM
Mr. Stickel reiterated that a more nuanced discussion on
oil prices could be had with DNR. He said that one of the
significant contributors to the uncertainty would be the
performance of some new developments as well as the timing
of those developments.
11:07:16 AM
Co-Chair Stedman suggested working with the Department of
Natural Resources (DNR) on the issue to keep track over the
upcoming months.
11:07:43 AM
Senator Wielechowski noted the significant divergence
between the high and low cases on the slide, within a short
period of time. He queried what would be required to
accomplish 600,000bbl in FY 23 or 400,000/bbl in FY 23.
11:08:05 AM
Mr. Stickel stated that he would work with DNR to provide
further insight to the committee.
11:08:13 AM
Senator von Imhof opined that there were uncontrollable
factors that affected the forecast.
11:08:59 AM
Mr. Stickel addressed slide 22, Petroleum Detail: Changes
to North Slope Petroleum Production Forecast, which
offered a comparison between the spring and fall forecasts.
He related that there was very little change in the
production forecast from fall to spring.
11:09:21 AM
Mr. Stickel pointed to slide 23, Petroleum Detail: North
Slope Allowable Lease Expenditures, which showed how
allowable lease expenditures for the North Slope had
changed over the last decade, as well as the forecast for
the next 10 years. He shared that also included was the
average annual employment in the industry, this was to
illustrate the correlation between company spending in the
industry and employment. He said that the expenditures were
important because they were part of the production tax
calculation and because they were an important measure of
investment in the industry for the state. He revealed that
the pandemic had led decreased spending in FY 21 due to low
oil prices and production curtailments. He noted $1.5
billion in capital expenditure and $2.4 of operating
expenditure in FY 21. He said that operating expenditures
were expected to remain stable in the current fiscal year
and then increase in future years. He said that significant
increases in capital expenditures were expected for FY 23
through FY 25, based on new field investments included in
the production forecast.
11:11:15 AM
Senator Wielechowski noted the significant projected jump
in capital and operating expenditures. He thought that the
projected development forecast remained flat and wondered
whether the expenditure was meant to off-set decline due to
the pandemic.
11:11:39 AM
Mr. Stickel replied that over time production would decline
in any oil basin. He said that the slide reflected the
investment the department projected would be necessary.
11:12:01 AM
Co-Chair Stedman asked about how the industry reported
their expectations of capital expenditures to that were the
basis for the department's projections.
11:12:23 AM
Mr. Stickel replied that companies reported actual lease
expenditures on their annual tax returns and filed monthly
informational filings. Twice a year in preparation for the
forecast, operators were required to produce a 5-year
projection of capital and operating costs. He added that
the department reached out to producers, key explorers, and
development companies as well as examining public
information, to develop the aggregated production forecast.
11:13:09 AM
Mr. Stickel pointed to slide 24, Petroleum Detail: North
Slope Transportation Costs. He stated that the slide
showed the cost of getting oil form the North Slope to
market. He related that transportation costs impacted the
value of oil for both tax and royalty purposes. The
forecast was $9.40/bbl in FY 23 for transportation costs.
He said that it was expected that the cost would remain
under $10/bbl in the out years.
11:14:09 AM
Mr. Stickel discussed slide 25, Petroleum Detail: Tax
Credits for Purchase Detail. He shared that prior to 2016
companies were able to generate the tax credits for various
activities and the tax credits could be applied against a
liability or turn them into a tax credit certificate
available for state purchase. He furthered that the
availability to earn the credits for state purchase had
been phased out through legislative action in 2016 and
2017. He said at the this point no new credits were being
earned that were available for state purchase. He stated
that prior to 2016, the legislature had appropriated the
full amount required to purchase the outstanding credits.
Mr. Stickel continued to discuss slide 25.
11:16:13 AM
Co-Chair Stedman understood that in FY 23, $101/bbl oil was
being used in the graph on slide 25.
11:16:16 AM
Mr. Stickel agreed.
11:16:18 AM
Co-Chair Stedman asked that $10 increments be applied from
$101/bbl down to $70/bbl and up to $110/bbl. He was
uncomfortable setting up budget expectations at $101/bbl.
He spoke of a request from the administration in the
Operating Budget to add 233 new employees. This did not
include the Alaska Marine Highway System (AMHS). He said
that all three branches of government had approached the
legislature about wage inflation and employee turnover. He
related that when all three branches were concerned about
the same issue it increased the urgency and pressure. He
did not wasn't the financial state of the state to be
reliant on the war in Ukraine. He believed that other oil
prices should be considered and applied.
11:19:04 AM
Senator Olson remarked that the tax credits had been a sour
issue for many years. He wondered whether there was support
from the administration to pay off all the tax credits in
FY 23, since there was steady revenue and federal dollars
coming into the state.
11:19:30 AM
Mr. Stickel recalled that the deputy commissioner of the
department that the administration supported making the
statutory appropriation.
11:19:44 AM
Co-Chair Stedman understood that the statutory
appropriation would be at $101/bbl.
Mr. Stickel replied in the affirmative.
Co-Chair Stedman solicited further questions. He thanked
Mr. Stickel for the presentation. He discussed slide 2 of
the presentation and noted that the bottom two lines on the
slide were helpful. He also appreciated the format. He and
encouraged that the same format should be used on the
summary tables for the fall and spring forecasts.
Co-Chair Stedman discussed housekeeping.
ADJOURNMENT
11:23:25 AM
The meeting was adjourned at 11:23 a.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| 032222 Spring 2022 Revenue Forecast SFIN Presentation 2022.03.22.pdf |
SFIN 3/22/2022 9:00:00 AM |
|
| SB 235 States Reaction to Russia (003).pdf |
SFIN 3/22/2022 9:00:00 AM |
SB 235 |
| SB 235 Divestment TL Senate.pdf |
SFIN 3/22/2022 9:00:00 AM |
SB 235 |
| SB 235 DOR Senate Finance 3_22_2022 SB235 SFIN.pdf |
SFIN 3/22/2022 9:00:00 AM |
SB 235 |
| SB 235 State Financial Pressure Against Russia (003).docx |
SFIN 3/22/2022 9:00:00 AM |
SB 235 |
| SB 235 Support Hykes.pdf |
SFIN 3/22/2022 9:00:00 AM |
SB 235 |
| 030222 DOR Response to March 2022 Order of Operations SFIN 2022.03.10.pdf |
SFIN 3/22/2022 9:00:00 AM |
|
| 032222 DOR Response to SFIN Spring FC Presentation 2022.03.30.pdf |
SFIN 3/22/2022 9:00:00 AM |