HCR 21-ECONOMIC DEVELOPMENT PLANNING COMMISSION  1:35:00 PM CHAIR OLSON announced that the next order of business would be HOUSE CONCURRENT RESOLUTION NO. 21, Creating and relating to the Economic Development Planning Commission. [Before the Committee was the CSHCR 21(EDT).] 1:35:31 PM ROB EARL, Staff, Representative Bob Herron, Alaska State Legislature, introduced himself. He explained that the bill's prime sponsors are Representative Herron and Munoz, but commented that Representative Austerman's office has also been instrumental in bringing this issue forward. 1:36:00 PM MR. EARL referred to his PowerPoint. The bill would create a 10 member Economic Development Planning Commission (EDPC) in the legislative branch [slide 2]. The EDPC would act as a bridge to synthesize ideas and make policy recommendations and any draft legislation necessary for the legislature to consider. The EDPC would report to the Legislative Budget and Audit Committee, the Governor, and Legislative Council. The bill would sunset on June 30, 2012. 1:36:49 PM ERIN HARRINGTON, Staff, Representative Alan Austerman, Alaska State Legislature, reiterated that the purpose of HCR 21 is to integrate the legislature into some of the ongoing economic development planning processes. She referred to a report by Alaska Forward, which was sent to legislators. MS. HARRINGTON explained that this effort has been led by the Alaska Partnership for Economic Development, which is an umbrella organization representing the Alaska Regional Development Organizations (ARDORs) [slide 3]. Many organizations have been involved in the process, including the Alaska State Chamber of Commerce. Alaska Forward received a $500,000 grant from the Denali Commission for its Phase I effort. Alaska Forward is currently working on funding for its Phase II tasks, which will likely result in substantive recommendations in the spring. Another ongoing process is the Governor's Legacy initiative, which was established by an administrative order from the Palin Administration. This project is "morphing" under the current governor to align with the Alaska Forward efforts as well as working in a "work group" effort that has resulted in significant work products. MS. HARRINGTON related that numerous entities are involved in effort directed at long-term, strategic planning included in "Alaska's Economic Development 'System'" [slide 4]. This slide identified some of the different organizations involved in economic development efforts at the state, regional, borough, and municipal levels. Not all organizations have the opportunity to work with the legislature, she stated 1:39:01 PM MS. HARRINGTON asked the question, "Is there a need for an Economic Development Planning Commission? [slide 5]." The ongoing economic development efforts represent a significant investment of effort and financial resources by Alaskans. This commission gives the legislature the opportunity to be engaged throughout the process, which ensures legislative action is informed by private sector participation. The EDPC responds to identified shortcomings in previous economic development efforts. In reviewing and researching economic development in Alaska, it was found that in some cases when legislature action was needed, the legislature had not had an opportunity to proactively participate in some of the processes. 1:40:57 PM MS. HARRINGTON listed the kinds of opportunities the commission may identify such as: financial tools that need to be set in place by statutory action; targeting industry "clusters"; preparing the legislature in advance of the session to address the needs of economic development organizations; restructuring of departments that relate to economic development [slide 6]. 1:41:25 PM MR. EARL presented slide 7, which displayed the appointment authority for the membership of the commission. He pointed out that eight legislators would appoint six public members, which he hoped would lead to a diversity of geographical representation, experience, and industry representation. The commissioners of the Department of Commerce, Community, & Economic Development (DCCED) and the Department of Labor & Workforce Development (DLWD) are appointed automatically, and are ex officio, non-voting members. 1:41:56 PM CHAIR OLSON asked whether the House Labor and Commerce Committee chair has appointment authority. MR. EARL answered no. 1:42:02 PM REPRESENTATIVE T. WILSON asked which appointment would represent Interior Alaska. MS. HARRINGTON responded that the EDPC does not currently have geographic definitions for the appointments. She explained that with the Finance Co-Chairs of both bodies, the Senate President, the House Speaker, and the House and Senate Minority Leaders making appointments; the hope is to achieve diversity. As it currently stands, there is not any geographic definition of the membership. 1:42:48 PM MR. EARL continued. He discussed a timeline for HCR 21 as follows: March, 2010, Alaska Forward Phase I Report; April 30, 2010, or when members are appointed, whichever is earlier, commission begins work; January 30, 2011, first legislative report deadline; 2011 (tentative), Alaska Forward Phase II report; December 15, 2011, second report deadline; June 30, 2012, sunset [slide 8]. 1:43:48 PM MR. EARL observed there is a consensus in the business community that there is a "lack of cohesive thinking on economic development in Alaska" [slide 9]. The Alaska Industrial Development & Export Authority (AIDEA)'s Strategic Plan was released this spring, the Alaska Forward's Phase I Executive Summary, and the Alaska State Chamber of Commerce 2010 Position Paper all mention the lack of statewide planning. 1:44:25 PM MR. EARL reviewed the documents provided in the committee packet [slide 10]. He referred to a Legislative Research Report: Alaska Economic Development Organizations that Representative Herron's office recently ordered. Additionally, Representative Austerman has developed a website with an Economic Development Library that he characterized as worthwhile. 1:44:54 PM MR. EARL discussed a breakdown of the fiscal note: $130,000 total; $108,000 for commission staff; $11,000 for travel; $11,000 for per diem [slide 11]. The fiscal note was written under the following assumptions: three meetings require travel; one Anchorage meeting and two Fairbanks meetings; per diem for two days per travel meeting; three Anchorage-based members, one Fairbanks-based member. 1:45:23 PM REPRESENTATIVE T. WILSON asked for the bill's purpose. She related her understanding that Alaska already has ARDORs working together on economic development. 1:45:47 PM MS. HARRINGTON responded that this organization does not have any membership from the ARDORs. This proposed commission would be comprised of legislators and private sector membership. The goal of the proposed commission will be to develop the legislative actions that result from recommendations of a number of processes. This would allow the legislature to engage in these processes proactively and make recommendations that could be implemented through the legislative process, including department restructuring if that would be deemed to be appropriate. 1:46:34 PM REPRESENTATIVE T. WILSON asked who in the administration is in charge of economic development. MS. HARRINGTON answered the Department of Commerce, Community, & Economic Development (DCCED) works on economic development. She provided some background information. Representative Austerman chairs the DCCED Finance Subcommittee. During the course of reviewing the department through his subcommittee's work, it came to his attention that inadequate resources were being applied to economic development, with only about a dozen people dedicated to economic development. During the interim he worked with the Department of Labor & Workforce Development CRA to increase that effort. Thus, the EDPC is one recommendation to proactively assist with economic development in the state. 1:47:55 PM REPRESENTATIVE T. WILSON agreed 100 percent with knowledge of economic development in the state. She related her concern with the political aspect. She shared an additional concern that the ARDORs, such as the one in Fairbanks, are not being utilized instead of looking for other recommendations. 1:48:42 PM MS. HARRINGTON explained that the 12 ARDORs in the state receive less than $60,000 annually from the state. Ones that are located in larger communities have been able to draw on other resources, she stated. However, a number of them only employ part-time staff to cover significant geographical areas. She explained that the ARDORS work with different resources and are not equipped to draft legislation to implement the ideas. This commission would be able to draw on the legislator resources to work to implement the recommendations made by the volunteer organization. 1:50:10 PM REPRESENTATIVE LYNN offered that all legislative members support economic development. He thought it seems like just another organization. He said he can already speak to anyone who wants to work on economic development issues and many group representatives currently approach him with ideas. He related that the legislature already has a House Special Committee on Economic Development, Trade, and Tourism. He asked if this is actually the EDT committee's role and wondered about the necessity of a commission sharing the same goal as other committees. REPRESENTATIVE LYNN asked whether it is necessary to enhance the stage for economic development. He related that the fiscal note is $130,000 for two years, which is a lot of money for something that is already being done. REPRESENTATIVE HOLMES agreed. She offered that this bill would create a group, with one staff, comprised of unpaid people and the volunteers that would meet three times a year. The volunteers would have outside jobs. She stated that she appreciates the idea of legislature's involvement and thinks the concept is great. However, she is worried this bill would create one more group that would "talk a little bit" but she offered that she was not convinced the commission's efforts would result in a product. 1:53:53 PM CHAIR OLSON related that he did not intend to move the bill today. 1:54:02 PM REPRESENTATIVE HOLMES made a motion to adopt Amendment 1, labeled 26-LS1446\P.1, Cook, 3/30/10, which read, as follows: Page 2, line 30, following "designee": Insert "; (11) the president of the Alaska Partnership for Economic Development, or the president's designee" CHAIR OLSON objected for purpose of discussion. 1:54:29 PM MR. EARL offered his belief that president of the Alaska Partnership for Economic Development would serve the proposed commission well. REPRESENTATIVE T. WILSON asked for clarification that this is to add another person instead of the Commissioner of the Department of Labor & Workforce Development. MR. EARL answered this would be another person that would automatically be added to serve on the proposed commission. REPRESENTATIVE HOLMES assumed the goal was to further integrate ongoing efforts. MR. EARL agreed. He stated that this addition would integrate the work performed by Alaska Forward with the proposed commission. 1:55:56 PM REPRESENTATIVE T. WILSON asked whether the Alaska Partnership for Economic Development is a public or private group. MS. HARRINGTON answered that the Alaska Partnership for Economic Development is the umbrella organization formed by ARDORs. Up until the formation of this group, the ARDORs did not have any opportunity to meet and discuss work. This bill would provide that ability. The Alaska Partnership for Economic Development funds the Alaska Forward project. CHAIR OLSON removed his objection. There being no further objection, Amendment 1 was adopted 1:56:48 PM REPRESENTATIVE HOLMES made a motion to adopt Amendment 2, labeled 26-LS1446\P.2, Cook, 3/30/10, which read as follows: Page 3, line 16: Delete "and to the legislative budget and audit committee" Insert ", the Legislative Budget and Audit Committee, the House Labor and Commerce Committee, and the Senate Labor and Commerce Committee" CHAIR OLSON objected. MR. EARL related this was suggested by a member in the other body. The suggestion was that the proposed commission report to both of the Labor and Commerce Committees in addition to the Legislative Budget and Audit Committee. There being no objection, Amendment 2 was adopted. [HCR 21 was held over.]