SCSCSHB 494(STA): An Act changing the Alaska State Pension Investment Board to the Alaska Pension Investment Authority and relating to the authority; and providing for an effective date. Darrel Rexwinkel, Commissioner, Department of Revenue, and Gayle R. Oba, Vice Chair, Alaska State Pension Investment Board, spoke to HB 494 and to the fiscal notes. Discussion was held regarding fiscal notes and amendment 2 which was ADOPTED in the previous Senate Finance meeting. A motion to rescind amendment 2 FAILED. Amendments 3 and 4 by Senator Rieger were ADOPTED. SCSCSHB 494(STA) was REPORTED out of committee with individual recommendations, a zero fiscal note for the Department of Administration, and fiscal notes for the Department of Revenue for $497.0 and $398.5. SENATE CS FOR CS FOR HOUSE BILL NO. 494(FIN): An Act changing the Alaska State Pension Investment Board to the Alaska Pension Investment Authority and relating to the authority; and providing for an effective date. Co-chair Pearce announced that HB 494 was before the committee. She reviewed the fact that amendment 1 had FAILED and amendment 2 was ADOPTED in a prior meeting. In answer to Senator Kerttula regarding amendment 2, Co- chair Pearce pointed out that Senator Rieger's view was that there was not a sufficient labor pool in Juneau of skilled people who were not already either working for the Permanent Fund or other funds from which to choose a new executive director. Senator Kelly said the same argument could be used for moving the Permanent Fund. Co-chair Frank said he did not support amendment 2 and opposed putting that constraint on the Pension Investment Authority. He then asked why the fiscal note contained general fund money and not all pension fund money. DARREL REXWINKEL, Commissioner, Department of Revenue, spoke on behalf of the board and as Commissioner of Revenue, and explained the complicated fiscal notes regarding the reorganization of the Treasury Division and creation of the Pension Investment Authority. Co-chair Frank asked the department to redo the existing fiscal notes so they could be easily understood. In returning to discussion over amendment 2, Senator Rieger recalled a problem in 1989 or so when the Department of Revenue was sorely lacking in staff. There was no one unemployed in Juneau that could fill those vacancies. The solution was that the department robbed two top employees of the Permanent Fund. He did not want that scenario to be repeated with this new organization. Senator Kerttula opposed moving the Authority because of information he had received regarding the inter-relationships of the trusts and in-house, multiple units involving both organizations. Senator Rieger reiterated his feelings that, with the addition of eight more employees which included an executive director, and drawing on the same talent pool, it could not offer improved management to the Authority. He would also like to restrict the area to Alaska in amendment 2. GAYLE R. OBA, Vice Chair, Alaska State Pension Investment Board, asked to speak on amendment 2. Senator Kerttula MOVED to rescind the adoption of amendment 2. Ms. Oba agreed that it did not make sense to move the Pension Fund operation to Anchorage. It was her understanding that it would be easier to move the Permanent Fund to Anchorage. Because of the degree of coordination between the Department of Revenue regarding SBS and deferred compensation, it would not be an efficient move. She suggested that during 1989, the situation was much different. Since then, Wall Street alone had lost about 50,000 white collar positions. Now, if the State recruited for new positions, she believed well qualified candidates would be willing to move even to Juneau. End SFC-93 #91, Side 1 Begin SFC-93 #91, Side 2 Senator Rieger agreed to consider a delayed effective date on the bill but would not support the bill unless there was a way to access better management for the Pension Fund. Co-chair Pearce called for a show of hands and the motion to rescind the adoption of amendment 2 FAILED (Senator Kerttula was in support of the motion, Co-chair Pearce, Senators Kelly, Sharp, Rieger and Jacko were opposed). Senator Rieger MOVED amendment 3 that added the words "Alaskan" before the words "metropolitan area" in amendment 2. Co-chair Pearce called for a show of hands and amendment 3 was ADOPTED on a vote of 5 to 1 (Co-chairs Pearce, and Frank, Senators Kelly, Sharp, Rieger and Jacko were in support. Senator Kerttula was opposed.). Senator Rieger then MOVED amendment 4 making the effective date for Section 3, July 1, 1995. No objection being heard, amendment 4 was ADOPTED. Senator Jacko MOVED for passage of SCSCSHB 494(FIN) from committee with individual recommendations. Senator Kelly OBJECTED. Co-chair Pearce called for a show of hands and the motion to MOVE the bill from committee carried on a vote of 4 to 3 (Co-chairs Pearce, and Frank, Senators Rieger and Jacko were in support, Senators Kerttula, Kelly, and Sharp were opposed). SCSCSHB 494(FIN) was REPORTED out of committee with individual recommendations, a zero fiscal note for the Department of Administration, and fiscal notes for the Department of Revenue for $497.0 and $398.5. Co- chairs Pearce and Frank signed "no recommendation." Senators Rieger and Jacko signed "do pass." Senators Kerttula, Kelly and Sharp signed "do not pass."