HJR 3-CONST. AM: PERMANENT FUND Number 2323 CHAIR WEYHRAUCH announced that the last order of business was HOUSE JOINT RESOLUTION NO. 3, Proposing amendments to the Constitution of the State of Alaska relating to the Alaska permanent fund. CHAIR WEYHRAUCH opened public testimony. Number 2370 ROGER GAY told the committee that he is from Big Lake, Alaska. He stated his objection to the legislature and governor "always trying to set their sights on the permanent fund." He stated his belief that the state has assets that it refused to use to pay its bills. While the state owns practically all of the coal, zinc, lead, timber, gold, oil, gas, and land, he said, "you" depict the state as being poor. He suggested the state sell some of its land, dig up some of its gold, or drill for its own oil. The state should make its own money, he opined. Mr. Gay said the people [of Alaska] own less than one percent of "what's up here." He added, "And of the land we allegedly own, we only control the surface rights, and we pay taxes on that." He stated that the state has had plenty of time to have "forward funded" the government, but has failed to do so. He said, "And now you want to reach into my pocket instead of your own." He opined that [the legislature's] duty is to defend the constitution, including Article 9, Section 15; and when it tries to change the constitution it is not protecting and defending it. CHAIR WEYHRAUCH noted that [HJR 3] would change the constitution. He asked Mr. Gay if he is testifying in opposition to the resolution. MR. GAY responded that he is opposed to HJR 3. He stated that he thinks [the legislature] has been irresponsible in not properly conducting its financial affairs. He reiterated that he thinks the legislature should not use the permanent fund to solve its fiscal problems, because people need the money to pay for their food and medical bills. He said, "The state is not a living entity and the people of the state are." He suggested that [the legislature] could sell enough land to forward fund its bills for a year, and then "you'd be ahead of the curve." He indicated this step should be taken before taking money from the people of the state. He said, "You've got lots of money, and you're just not looking at it, you're looking at that permanent fund." Number 2548 REPRESENTATIVE SEATON noted that the state has been trying to give incentives to increase development in the state. He said there are five major world-class mines that "might come on line." He added that [due to the cost of getting] those mines going, and [because of] the way the tax structure is, basically, the state will receive no money from those mines. He asked Mr. Gay if he is suggesting that the legislature redo the tax structure on those kinds of developments so that the state garners significant quantities of money to pay its bills from that development, even if it would stop that development and those jobs from going forward. Number 2602 MR. GAY replied, "You own the land and you own the resources, and if you wanted to, you could develop them yourselves and make money." He gave the example of the gas pipeline. He said [the state] could build and own the gas pipeline if it wanted to. He listed state investments, such as the Delta barley project, the grain mill in Seward, and the farms out on Point Mackenzie, and he said, "They're not good." However, as far as the state's land holdings, he suggested that the state divest itself of those by giving them to local governments who would in turn be encouraged to sell those to the people to gain revenue through the taxes that the people would pay on the land. Instead, he said, [the state] is just holding on to that land and claiming that it's broke. Number 2637 REPRESENTATIVE SEATON continued his line of questioning as follows: So then, you're testimony would be that you would favor the state, as a state itself, developing those mines, and also probably using the permanent fund to finance and construct the gasoline. MR. GAY replied, "If those are appropriate uses of the permanent fund investments, then I would say yes." He opined, "The permanent fund should invest its money in Alaskan projects that benefit Alaska, instead of sending the money to New York bankers." Number 2696 CHAIR WEYHRAUCH stated that, based on all the amount of e-mails he received on this issue, he is shocked that there aren't more people who want to testify on this resolution. He expressed his reluctance to close public participation; therefore, he said he would not close it at this time. He also said he wants to give the resolution the benefit of the full committee. Number 2743 REPRESENTATIVE ERIC CROFT, Alaska State Legislature, as co- sponsor of HJR 3, in response to a question by Chair Weyhrauch, said he and co-sponsor Representative Harry Crawford would like to see the resolution move forward to the House Judiciary Standing Committee and do so as quickly as possible. [HJR 3 was heard and held.]