HOUSE BILL NO. 245 "An Act relating to the Alaska permanent fund; relating to appropriations to the dividend fund; relating to income of the Alaska permanent fund; relating to the earnings reserve account; relating to the Alaska permanent fund dividend; making conforming amendments; and providing for an effective date." Co-Chair Neuman MOVED to ADOPT the proposed committee substitute for HB 245, Work Draft 29-GH2859\N (Wallace/Martin, 4/16/16). There being NO OBJECTION, it was so ordered. 10:51:46 AM JANE PIERSON, STAFF, REPRESENTATIVE STEVE THOMPSON, reviewed the changes in the work draft from the previous version. She read the prepared sectional analysis: Sec. 1: 3 year Reevaluation Sec. 2: AS 36.30.015: Alaska Permanent Fund Corporation procurement. Alaska Permanent Fund Corporation can adopt its own procurement procedures, as long as they are similar to State procurement codes Sec. 3: AS 36.30.990(l): Adds Alaska Permanent Fund Corporation to the list of those exempt from State of Alaska procurement requirements. Sec. 4: AS 37.05.540(d): Tells the Alaska Permanent Fund Corporation to manage and invest assets of the Constitutional Budget Reserve Sec. 5: AS 37.05.565(a): Amerada Hess money no longer flows into the Capital Income Fund Sec. 6: AS 37.10.430(a): Alaska Permanent Fund Corporation shall manage Constitutional Budget Reserve funds by the effective date 7/1/17 Sec. 7: AS 37.10.430(b): Report by Alaska Permanent Fund Corporation to legislature re: Constitutional Budget Reserve Sec. 8: AS 37.13.010: Dedicated deposits of royalties to the Permanent Fund are reduced from the current 25/50 split in old/ new leases to the constitutional minimum of 25 percent Sec. 9: AS 37.13.140(a): Requires the Alaska Permanent Fund Corporation to determine the net income of the Earnings Reserve Account and excludes unrealized gains or losses Sec. 10: AS 37.13.140: Defines Percent of Market Value payout at 5.25 percent of the average year-end market value of the ERA for the first 5 of the most recent 6 years of the payout may not exceed the year-end balance of the Earnings Reserve Account (c) Volatility provision Sec. 11: Inflation Proofing Sec. 12: AS 37.13.446: Dividends are comprised of 20 percent of the 5.25 percent Percent of Market Value , and 20 percent of the prior year's royalties, excludes those dedicated to the Permanent Fund or School Fund (25.5 percent are dedicated) Sec. 13: AS 37.13.206(a): Conforming to new procurement Sec. 14: AS 37.13.300(c): Mental Health Trust Fund may not be included in the computation of the available income available for distribution under the Percent of Market Value Sec. 15: AS 37.14.031 (c): Makes computation of the AK Mental Health Trust Fund income consistent with computation of other PF income Sec. 16: AS 43.23.025 (a): Transfer of money to the Dividend Fund requires an appropriation Sec. 17: AS 43.23.025 (a): The amount of each Permanent Fund Dividend for fiscal years 2017, 2018, and 2019 shall be $1,000 Sec. 18: AS 43.23.045 (a): Conforms to Sec. 12 which moves dollars to dividend by appropriation. Sec. 19: Once the money is in the Dividend Fund, the Department of Revenue shall annually pay dividends without further appropriation. Sec. 20: Repealers: AS 37.10.430 (c) Subaccount of CBR, AS 37.13.145 (b) Dividend based on statutory net income, AS 37.13.145 (c) Inflation proofing, AS 37.13.145 (d) Amerada Hess Sec. 21: Repeals corresponding Session Law Sec. 22: Repeals $1000 dividend; Dividend goes to formula Sec. 23: Transition language RE: Regulations and policies adopted by Commissioner of the Dept. of Revenue and Permanent Fund Corporation Sec. 24: Retroactivity clause Sec. 25: Immediate effective date Sec. 26: Effective date July 1, 2017 Sec. 27: Effective date of July 1 2016 HB 245 was HEARD and HELD in committee for further consideration. Co-Chair Thompson recessed the meeting to a call of the chair [Note: the meeting never reconvened].