HOUSE BILL NO. 92 "An Act relating to borrowing in anticipation of revenues; relating to revenue anticipation notes; relating to line of credit agreements; and providing for an effective date." 11:16:15 AM Representative LeBon MOVED to ADOPT Amendment 2, 32- GH1707\A.3 (Wallace, 4/23/21) (copy on file): Page 3, following line 5: Insert a new bill section to read: "*Sec. 7. AS 43.08.050 is amended by adding a new subsection to read: (b) Within 30 days after an agreement to borrow money is executed under this chapter, the commissioner shall notify the Legislative Budget and Audit Committee that an agreement has been entered into and include (1) the financial terms of the agreement; and (2) an explanation for the determination that the agreement was in the best financial interests of the state." Renumber the following bill sections accordingly. Representative Rasmussen OBJECTED for discussion. Representative LeBon explained the amendment would require the Department of Revenue (DOR) report to the Legislative Budget and Audit Committee on the details of any agreements entered into related to current asset financing, a line of credit, working capital loans or whatever process may follow. He explained that the notification would occur within 30 days of the execution of an agreement. He detailed that the report should include a summary of the financial terms of the agreement and an explanation for the determination the agreement was in the best financial interest of the state. 11:17:32 AM Co-Chair Merrick clarified the amendment number was 32- GH1707\A.3. Representative Rasmussen WITHDREW her OBJECTION. There being NO further OBJECTION, Amendment 2 was ADOPTED. 11:18:07 AM Representative LeBon MOVED to ADOPT Amendment 1, 32-GH1707\A.2 (Wallace, 4/22/21) (copy on file): Page 1, line 2: Delete "line of credit agreements" Insert "short-term borrowing" Page 1, line 12: Delete "line of credit agreements" Insert "other forms of short-term borrowing" Representative Rasmussen OBJECTED for discussion. Representative LeBon explained that the amendment cleaned up bill language. He detailed that page 1, line 2 of the amendment would delete the phrase "line of credit agreements" and insert the phrase "short-term borrowing." Additionally, page 1, line 12 would delete the phrase "line of credit agreements" and insert the phrase "other forms of short-term borrowing." He stated the reason for the clean up was the legislature did not know precisely what pathway the DOR would follow to secure short-term financing options such as lines of credit or other short-term borrowing agreements. Co-Chair Merrick clarified the amendment number was 32- GH1707\A.2. Representative Rasmussen asked for verification that the other forms of short-term borrowing would encompass the line of credit agreements. Representative LeBon replied in the affirmative. He explained that the amendment broadened the options. He detailed there were a variety of municipal market and bank options for short-term borrowing with a variety of flexibility, interest rates, and the ease in which temporary financing was secured for the state's working capital needs. The language change was to give DOR as much flexibility as possible to achieve its goal. Representative Rasmussen asked for verification that line of credit agreements would be included under one of the other forms of short-term borrowing. Representative LeBon replied affirmatively. He interpreted the phrase short-term borrowing to be broad enough to include a line of credit agreement. Representative Rasmussen WITHDREW her OBJECTION. There being NO further OBJECTION, Amendment 1 was ADOPTED. 11:20:50 AM Representative Rasmussen appreciated the amendments to make the legislation a bit stronger. She thought the bill was an important tool to give DOR to enable it to manage the financial interests of the state in the best way possible. Co-Chair Foster MOVED to REPORT CSHB 92(FIN) out of committee with individual recommendations and the accompanying fiscal note. There being NO OBJECTION, it was so ordered. CSHB 92(FIN) was REPORTED out of committee with a "do pass" recommendation and with one new indeterminate fiscal note from the Department of Revenue. 11:21:36 AM AT EASE 11:24:47 AM RECONVENED