ALASKA STATE LEGISLATURE                                                                                  
    HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE                                                                   
                        February 3, 2011                                                                                        
                           8:04 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Cathy Engstrom Munoz, Chair                                                                                      
Representative Neal Foster, Vice Chair                                                                                          
Representative Alan Austerman                                                                                                   
Representative Alan Dick                                                                                                        
Representative Dan Saddler                                                                                                      
Representative Sharon Cissna                                                                                                    
Representative Berta Gardner                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 65                                                                                                               
"An Act making regional Native housing authorities eligible to                                                                  
receive grants through the Alaska Housing Finance Corporation                                                                   
from the senior citizens housing development fund."                                                                             
                                                                                                                                
     - MOVED OUT OF COMMITTEE                                                                                                   
                                                                                                                                
OVERVIEW(S):  DEPARTMENT OF COMMERCE, COMMUNITY & ECONOMIC                                                                      
DEVELOPMENT                                                                                                                     
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
SERVE ALASKA                                                                                                                    
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB  65                                                                                                                  
SHORT TITLE: SENIOR CITIZEN HOUSING DEV. FUND GRANTS                                                                            
SPONSOR(s): REPRESENTATIVE(s) EDGMON, HERRON, FOSTER, JOULE                                                                     
                                                                                                                                
01/18/11       (H)       PREFILE RELEASED 1/7/11                                                                                
01/18/11       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/18/11       (H)       CRA, FIN                                                                                               
02/01/11       (H)       CRA AT 8:00 AM BARNES 124                                                                              
02/01/11       (H)       Heard & Held                                                                                           
02/01/11       (H)       MINUTE(CRA)                                                                                            
02/03/11       (H)       CRA AT 8:00 AM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
TIM CLARK, Staff                                                                                                                
Representative Bryce Edgmon                                                                                                     
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented HB 65 on behalf of the sponsor,                                                                
Representative Edgmon.                                                                                                          
                                                                                                                                
SUSAN BELL, Commissioner                                                                                                        
Department of Commerce, Community & Economic Development (DCCED)                                                                
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Provided an overview of the Department of                                                                
Commerce, Community & Economic Development.                                                                                     
                                                                                                                                
JOELLEN HANRAHAN, Director                                                                                                      
Division of Administrative Services                                                                                             
Department of Commerce, Community & Economic Development                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  During DCCED overview, answered questions.                                                               
                                                                                                                                
NITA MADSEN, Director                                                                                                           
Serve Alaska                                                                                                                    
State Service Commission                                                                                                        
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Provided a presentation on Serve Alaska.                                                                 
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
8:04:39 AM                                                                                                                    
                                                                                                                                
CHAIR  CATHY  ENGSTROM  MUNOZ  called   the  House  Community  and                                                            
Regional  Affairs  Standing Committee  meeting  to  order at  8:04                                                              
a.m.    Representatives  Munoz, Foster,  Austerman,  Gardner,  and                                                              
Dick were present  at the call to order.   Representatives Saddler                                                              
and Cissna arrived as the meeting was in progress.                                                                              
                                                                                                                                
         HB  65-SENIOR CITIZEN HOUSING DEV. FUND GRANTS                                                                     
                                                                                                                                
8:04:55 AM                                                                                                                    
                                                                                                                                
CHAIR MUNOZ  announced that the  first order of business  would be                                                              
HOUSE  BILL  NO.  65,  "An  Act  making  regional  Native  housing                                                              
authorities  eligible   to  receive  grants  through   the  Alaska                                                              
Housing  Finance  Corporation  from the  senior  citizens  housing                                                              
development fund."                                                                                                              
                                                                                                                                
8:05:34 AM                                                                                                                    
                                                                                                                                
TIM  CLARK,  Staff,  Representative  Bryce  Edgmon,  Alaska  State                                                              
Legislature,  reminded  the  committee  that HB  65  will  benefit                                                              
senior citizens  by including rural housing authorities  among the                                                              
eligible entities  for grants through  the Alaska  Housing Finance                                                              
Corporation's  (AHFC)  Senior Citizens  Housing  Development  Fund                                                              
(SCHDF).      Currently,   the   fund   is   only   available   to                                                              
municipalities  and  501(c)(3)   and  501(c)(4)  nonprofits.    He                                                              
recalled that at  the last meeting there was  a question regarding                                                              
examples of nonprofits  that currently qualify for  grants through                                                              
SCHDF.    Two  of the  three  projects  highlighted  at  the  last                                                              
hearing,  which  were  partially  funded through  SCHDF,  are  the                                                              
Fairbanks  retirement  home  as  well  as  the  Mid-Valley  senior                                                              
citizens  facility.    Additional  examples were  specified  in  a                                                              
memorandum  recently  provided   to  members.    Those  additional                                                              
examples    included   the   Palmer    Senior   Citizens    Center                                                              
Incorporated, Meadow  Lake Community Council, Bristol  Bay Housing                                                              
Development  Corporation,  and Ninilchik  Tribal  Health,  Culture                                                              
and Heritage nonprofit.                                                                                                         
                                                                                                                                
8:08:45 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GARDNER moved  to report  HB 65  out of  committee                                                              
with  individual  recommendations   and  the  accompanying  fiscal                                                              
notes.  There being no objection, it was so ordered.                                                                            
                                                                                                                                
8:09:21 AM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
8:10:37 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GARDNER  moved  that  the  committee  rescind  its                                                              
action  in reporting  HB  65 out  of committee.    There being  no                                                              
objection, HB 65 was before the committee.                                                                                      
                                                                                                                                
8:10:55 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER moved  to report  HB 65  out of  committee                                                              
with  individual  recommendations   and  the  accompanying  fiscal                                                              
notes.  There being no objection, it was so ordered.                                                                            
                                                                                                                                
^Overview:     Department  of   Commerce,  Community   &  Economic                                                              
Development                                                                                                                     
   Overview(s):  Department of Commerce, Community & Economic                                                               
                          Development                                                                                       
                                                                                                                              
8:11:32 AM                                                                                                                    
                                                                                                                                
CHAIR MUNOZ  announced that  the next order  of business  would be                                                              
an overview  of the Department  of Commerce, Community  & Economic                                                              
Development.                                                                                                                    
                                                                                                                                
8:12:05 AM                                                                                                                    
                                                                                                                                
SUSAN  BELL, Commissioner,  Department  of  Commerce, Community  &                                                              
Economic   Development   (DCCED),   began  her   presentation   by                                                              
highlighting  the  mission  of  DCCED,  which  is  to  "promote  a                                                              
healthy  economy,  strong  communities and  protect  consumers  in                                                              
Alaska."    She   then  directed  attention  to  page   2  of  her                                                              
presentation,  which is  an organizational  chart of  DCCED.   The                                                              
department houses  six corporate  agencies and six  core agencies.                                                              
The department  works across departmental  lines through  a number                                                              
of  programs and  provides  access to  capital,  state grants  and                                                              
loans, as  well as a  number of development  programs that  can be                                                              
utilized  in  order  to  diversify   and  strengthen  the  state's                                                              
economy.   She  pointed out  that  DCCED markets  Alaska and  many                                                              
Alaska  products.    Moreover,  the department  has  a  number  of                                                              
regulatory  agencies  and  provides   considerable  assistance  to                                                              
local governments  and unincorporated  communities through  grants                                                              
and technical  assistance.   Commissioner  Bell then informed  the                                                              
committee that DCCED  has a total of 538 employees  throughout the                                                              
state  and  a  total  fiscal year  (FY)  2012  budget  request  of                                                              
$204,178.4 million,  the breakdown of which the pie  chart on page                                                              
4 illustrates.   Of that total  request approximately  39 percent,                                                              
$80  million,  is  for  economic  growth;  26  percent,  $53,315.8                                                              
million is for  sustainable energy; 19 percent,  $38,927.5, is for                                                              
strong  communities, and  16 percent,  $32,129.1  million, is  for                                                              
consumer  protection.    Commissioner  Bell  remarked  that  DCCED                                                              
assist communities  to achieve  maximum local self-governance  and                                                              
foster  volunteerism  statewide  through  DCRA and  Serve  Alaska.                                                              
She noted  that the reductions in  the budget request  are largely                                                              
from  one-time  grant  items  that   were  in  the  [Division]  of                                                              
Community  &  Regional Affairs  (DCRA).    She then  informed  the                                                              
committee that  the following two  experienced people  are leading                                                              
two of  the department's  core entities:  Sara Fisher-Goad  is the                                                              
new executive  director of the  Alaska Energy Authority  (AEA) and                                                              
Scott Ruby,  a 26-year  veteran of DCRA,  is DCRA's  new director.                                                              
Returning  to sustainable  energy, Commissioner  Bell pointed  out                                                              
that the  department is  focused on  the sustainability  of energy                                                              
systems,  reducing  the costs  of  energy, and  achieving  DCCED's                                                              
statewide goals.                                                                                                                
                                                                                                                                
8:18:33 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   AUSTERMAN,   referring   to   page   5   of   the                                                              
presentation,  highlighted the $1.4  million reduction  of general                                                              
fund (GF) in  power cost equalization (PCE) funding.   He reminded                                                              
members  that  the  PCE fund  that  generates  interest  earnings,                                                              
which help  pay for the cost of  PCE throughout the state.   There                                                              
is also  an infusion  of cash  from the  GF because  the PCE  fund                                                              
doesn't generate  enough interest  earnings to  pay for  the basic                                                              
services that  are provided  for under PCE.   For many  years, the                                                              
legislature battled  how much money to  put into PCE from  the GF,                                                              
and  thus it  became  a negotiating  instrument  during the  final                                                              
budget  process.    However,  currently,  the PCE  payout  to  the                                                              
communities is set  and the interest earnings of the  PCE fund are                                                              
subtracted  from that  and the remainder  is  the GF.   Currently,                                                              
the   system  is   set  up   so  that   the  [aforementioned]   is                                                              
automatically paid  for from the GF.  Therefore,  the $1.4 million                                                              
reduction  is  based  upon  last  year's  amount  of  funding  the                                                              
legislature  put  in from  the  GF  to the  PCE.   This  year  the                                                              
legislature will put in $1.4 million less than it did last year.                                                                
                                                                                                                                
8:20:39 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  BELL continued  her presentation  by describing  the                                                              
priority  programs  referenced  on  page  6.      With  regard  to                                                              
consumer protection,  she pointed out that four  divisions address                                                              
this  mission in  terms of  licensing,  regulating, and  enforcing                                                              
the  state's statutes  and  regulations  to protect  the  consumer                                                              
while providing  a stable business  climate.  With regard  to PCE,                                                              
Commissioner  Bell  informed  the committee  that  the  Regulatory                                                              
Commission of Alaska  (RCA) deals with the computation  of the PCE                                                              
funds and AEA distributes  the PCE funds.  She then  turned to the                                                              
department's  economic development  program, which  has a  mission                                                              
to diversify and strengthen the state's industry sectors.                                                                       
                                                                                                                                
8:22:21 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  DICK related  that some of  his constituents,  who                                                              
are  entrepreneurs,   have  told   him  they  find   that  they're                                                              
competing  against  their own  tax  dollars, state  programs,  and                                                              
state  entities.   He inquired  as to  how he  should direct  such                                                              
concerns.                                                                                                                       
                                                                                                                                
COMMISSINER  BELL   encouraged  those  folks  to   contact  DCCED,                                                              
specifically  the Division  of  Economic Development  because  the                                                              
division  may be  able  to provide  market  research or  financing                                                              
programs that  may assist them.   With regard to  competition, she                                                              
highlighted  that the administration's  legislation includes  some                                                              
additional  revolving loan  funds that  specifically target  small                                                              
enterprises and self-employment.                                                                                                
                                                                                                                                
REPRESENTATIVE  DICK clarified that  he's referring  to businesses                                                              
that have  existed for decades  and now find themselves  competing                                                              
with  government   programs.    For   example,  in  one   case  an                                                              
entrepreneur built  teacher housing,  but then the  government was                                                              
able   to  provide   housing  for   the  teachers   and  now   the                                                              
entrepreneur's housing sits vacant.                                                                                             
                                                                                                                                
COMMISSIONER BELL  suggested that  perhaps the department  and the                                                              
state should  think more  about how to  attract more  business and                                                              
visitor  traffic and  how that can  strengthen  the economy.   She                                                              
acknowledged  that  the  example crosses  departmental  lines  and                                                              
that the department should be aware of that.                                                                                    
                                                                                                                                
8:24:57 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CISSNA  remarked that  she has seen  DCCED programs                                                              
that  have  worked  in  the  communities  that  she  has  visited.                                                              
Furthermore,  the department  and the division  have been  helpful                                                              
in helping people  understand the law and work through  it to work                                                              
through  the system  into  a leadership  position.   However,  she                                                              
highlighted  the  lack of  oversight  such  that the  state  isn't                                                              
really doing  a good  job in  ensuring that  what's built  fits in                                                              
the community in which it's constructed.                                                                                        
                                                                                                                                
COMMISSIONER BELL  opined that some of what  Representative Cissna                                                              
is describing  is a  function of  state funded, federally  funded,                                                              
and privately  funded [projects].   She  expressed the  importance                                                              
of  departments,  subcabinets,  commissions,  and  other  entities                                                              
engaging in the simpler aspects of projects and needs.                                                                          
                                                                                                                                
8:29:09 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GARDNER  turned attention  to  the Alaska  Seafood                                                              
Marketing  Institute   (ASMI)  and  the  Alaska   Travel  Industry                                                              
Association  (ATIA).    She  viewed  ASMI  and  ATIA  as  parallel                                                              
agencies  in  many respects  because  both  organizations  promote                                                              
Alaska  resources  and businesses  for  both the  large  corporate                                                              
organizations  and  the  smaller   organizations.    However,  one                                                              
entity is a state  agency and the other is a private  entity.  She                                                              
inquired  as to  the advantages  and  disadvantages of  separately                                                              
addressing fisheries versus tourism.                                                                                            
                                                                                                                                
COMMISSIONER BELL  expressed the need to recognize  that the state                                                              
has tried  various marketing  models with  tourism.  She  recalled                                                              
that  over   her  20  years   of  direct  engagement   in  tourism                                                              
management and  marketing she  has seen the  use of  those various                                                              
models.  She  mentioned models including one in  which the tourism                                                              
marketing  was   directly  administered   and  developed   by  the                                                              
Division  of  Tourism  and  another   model  in  which  it  was  a                                                              
public:private partnership.   She noted that in the  course of the                                                              
last  decade, ASMI  has  restructured  in terms  of  the size  and                                                              
composition  of its  board and  engagement  from the  legislature.                                                              
She  offered that  it would  be  valuable to  have a  side-by-side                                                              
comparison between  ATIA and ASMI  to review their  organizational                                                              
structure and funding.                                                                                                          
                                                                                                                                
8:32:59 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   DICK   emphasized   his  interest   in   economic                                                              
development in  the Bush and  would like  to share ideas  with the                                                              
department.                                                                                                                     
                                                                                                                                
8:33:41 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SADDLER  mentioned that  he  had  just attended  a                                                              
meeting  in  which the  Alaska  Aerospace  Corporation  executives                                                              
said they  support the  movement, per EO  115, of the  corporation                                                              
from  DCCED to  the Department  of Military  & Veterans'  Affairs.                                                              
He asked if the  department supports the aforementioned  move.  He                                                              
further asked what impact such a move would have on DCCED.                                                                      
                                                                                                                                
COMMISSIONER  BELL answered  that DCCED  supports the  move.   She                                                              
mentioned  that   the  Alaska   Aerospace  Corporation   has  been                                                              
publicly  pursuing a  contract  with Lockheed  Martin  Corporation                                                              
for the  missile defense  program  at Fort Greely.   Upon  review,                                                              
DCCED  recognized  that  the clientele  of  the  Alaska  Aerospace                                                              
Corporation  is primarily  military.  Furthermore,  even  when the                                                              
corporation  is  servicing  a commercial  client,  it  works  with                                                              
organizations that  are military like in structure  and accustomed                                                              
to working  with the  military.   The DCCED  also recognized  that                                                              
part of  the corporation's sustainability  plan is to help  find a                                                              
continuing  source   of  federal   funding.    Commissioner   Bell                                                              
remarked  that this  move  will help  align  the Alaska  Aerospace                                                              
Corporation  with the  military  structure and  provide it  access                                                              
that  will  be   beneficial.    Still,  whether   it's  through  a                                                              
continued board  seat or  engagement, DCCED wants  to be  sure the                                                              
corporation  is viewed  as  a growing  sector  and  economy.   She                                                              
highlighted  that  [the aerospace  industry]  has  high wage  jobs                                                              
that are  high technical  jobs.   Recent independent studies  from                                                              
several firms  have noted the  direct employment in  Anchorage and                                                              
Kodiak  as well  as  the 260  businesses  in  Alaska that  provide                                                              
goods and services  and secondary impact.  Furthermore,  the total                                                              
direct and  indirect employment  exceeded  200 jobs, she  related.                                                              
Commissioner  Bell said  that's  the exact  kind  of sector  DCCED                                                              
wants to grow and strengthen.                                                                                                   
                                                                                                                                
8:36:55 AM                                                                                                                    
                                                                                                                                
COMMISSIONER BELL  turned to the Division of  Community & Regional                                                              
Affairs (DCRA),  which is an  important aspect of  DCCED achieving                                                              
its  mission.   She  reminded the  committee  that  DCRA staff  is                                                              
engaged on  a daily basis with  local governments.   For instance,                                                              
DCRA provides  technical assistance  on accounting,  having lawful                                                              
elections,  understanding municipal  code,  and understanding  the                                                              
impact   of   state   law   and    regulations   on   communities.                                                              
Commissioner  Bell opined  that DCRA is  proactive with  training,                                                              
responsive to  issues that arise,  and touch a lot  of communities                                                              
through the  local government  assistance programs.   Furthermore,                                                              
DCRA  administers  the  Rural  Utility  Business  Advisory  (RUBA)                                                              
program that  focuses on  water and  wastewater systems  and their                                                              
sustainability.                                                                                                                 
                                                                                                                                
8:38:18 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  FOSTER remarked  that local government  assistance                                                              
is very important  in Western Alaska.  He surmised  that typically                                                              
a  community  would  request  assistance,  but  he  asked  if  the                                                              
[division/department] might  also recognize a community  is having                                                              
problems  and  initiate  assistance.   He  further  surmised  that                                                              
there  are  many   requests  for  assistance,  and   therefore  he                                                              
inquired as to how those are prioritized.                                                                                       
                                                                                                                                
COMMISSIONER  BELL  confirmed that  the  [division/department]  is                                                              
contacted   by   communities,   the   municipalities   and   local                                                              
governments,  as well as  via citizen  concerns to the  governor's                                                              
office or  the department.   The  DCRA, she  related, tries  to be                                                              
very responsive.   In fact,  the field  offices work in  the small                                                              
communities  in which  they're located  and  the regional  offices                                                              
work for  those in  the small  communities.   She noted  that DCRA                                                              
travels  a  lot  to  provide training  whether  it  is  for  local                                                              
government staff  or elected officials  or commissions.   Further,                                                              
DCRA  monitors  the  health  and   sustainability  of  communities                                                              
through various  reports, such  as the  quarterly RUBA  report and                                                              
Lien Watch.                                                                                                                     
                                                                                                                                
REPRESENTATIVE FOSTER  inquired as to  the percentage of  help the                                                              
DCRA provides to communities in contrast to the demand.                                                                         
                                                                                                                                
COMMISSIONER BELL  responded that she  could talk with  DCRA staff                                                              
regarding whether  a response could  be formulated.   However, she                                                              
highlighted  that it's  important  to recognize  that the  [demand                                                              
and response] is  ongoing as is the turnover  in elected officials                                                              
and  administrative staff.   She  maintained  that the  department                                                              
has an  ongoing commitment to ensure  services are provided.   She                                                              
then  highlighted that  after the  spike in  fuel costs  following                                                              
2008, fuel  watch became  a focus  of the  department in  order to                                                              
have an  understanding of  the various  situations of  communities                                                              
in relation to fuel.                                                                                                            
                                                                                                                                
8:44:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  asked if RUBA has any  oversight for power                                                              
utilities, gas or electric.                                                                                                     
                                                                                                                                
COMMISSIONER   BELL   responded   that  the   utilities   [receive                                                              
oversight] through the RCA and AEA.                                                                                             
                                                                                                                                
8:45:18 AM                                                                                                                    
                                                                                                                                
JOELLEN HANRAHAN,  Director, Division of Administrative  Services,                                                              
Department   of  Commerce,  Community   &  Economic   Development,                                                              
specified  that  [oversight] of  power  and electric  programs  is                                                              
through  AEA, which  provides technical  assistance  on bulk  fuel                                                              
and power.                                                                                                                      
                                                                                                                                
8:45:51 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CISSNA,  recalling the  2008  extreme increase  in                                                              
fuel  prices, remarked  that there  are "players"  that one  might                                                              
not  recognize,  such as  Homeland  Security.   However,  Homeland                                                              
Security comes  in with millions  right before complete  disaster.                                                              
Representative Cissna  opined that there needs to  be reporting of                                                              
those disastrous  situations  in which the  department is  working                                                              
with  daily   in  order  to  see   the  various  players   in  the                                                              
situations.   She expressed  concern  that the  lack of access  to                                                              
wood for  energy can  result in  burning other  items that  can be                                                              
harmful when  they're breathed  in.   Moreover, seniors  are being                                                              
moved  to other  neighborhoods  and  thus the  burden  of cost  is                                                              
being  shifted  from   one  part  of  Alaska  to   another.    The                                                              
aforementioned is  a large cost  driver.  She reiterated  the need                                                              
to chart these crises and to do so across departments.                                                                          
                                                                                                                                
COMMISSIONER  BELL,  regarding  outmigration  from  rural  Alaska,                                                              
informed  the committee  that staff  from within  DCRA is  working                                                              
with  various   data  to   track  the   out  migration   and  make                                                              
recommendations.   She  acknowledged  that  federal resources  are                                                              
available  when a  situation turns  to  a disaster.   The  Climate                                                              
Change Subcabinet  and the Immediate  Action Workgroup as  well as                                                              
DCRA staff  has been very engaged  with communities and  others to                                                              
determine how to  provide services prior to reaching  the disaster                                                              
point.      The   aforementioned   has   resulted   in   reviewing                                                              
infrastructure, relocation, and other things.                                                                                   
                                                                                                                                
MS.  HANRAHAN surmised  that Representative  Cissna is  addressing                                                              
the  need for  the  state to  perform  regional  planning for  the                                                              
future   as  well   as  regional   assessments   of  the   current                                                              
situations.   The aforementioned lends  itself to more of  a focus                                                              
on  interdepartmental  and  interagency   collaboration  with  the                                                              
federal government.                                                                                                             
                                                                                                                                
8:52:49 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  BELL,  returning   to  her  overview,  reviewed  the                                                              
breadth  of functions  of DCRA,  including  the administration  of                                                              
grants,  community revenue  sharing, and  distribution of  various                                                              
funds  such  as   payment  in  lieu  of  taxes,   national  forest                                                              
receipts,   and  fisheries   taxes.    The   DCRA  also   provides                                                              
publications  from  the  research  section,  the  state  assessor,                                                              
support  of  the Local  Boundary  Commission,  and the  bulk  fuel                                                              
bridge loan.   The DCRA  is also engaged  with communities  in the                                                              
national flood insurance  program.  Furthermore, work  on the land                                                              
transfer  from   Alaska  Native  Claims  Settlement   Act  (ANCSA)                                                              
corporations  to the state  is continuing.   However, there  are a                                                              
number of  challenges for DCRA,  including high costs and  lack of                                                              
infrastructure.   She echoed  her earlier  comments that  there is                                                              
an ongoing need  to provide this technical assistance,  which is a                                                              
statutory requirement.                                                                                                          
                                                                                                                                
COMMISSIONER  BELL then moved  on to  the Alaska Energy  Authority                                                              
(AEA), which  is charged with  providing technical  assistance and                                                              
training  to  those throughout  the  state  who are  managing  and                                                              
operating  energy systems  and infrastructure.   The  AEA is  also                                                              
involved in power  system upgrades and bulk fuel  upgrades.  While                                                              
transitioning  over  time to  more  renewable energy  sources  and                                                              
lower cost energy,  the infrastructure in communities  needs to be                                                              
sound.  She  related that AEA  is working to ensure  that existing                                                              
systems  are   functional  and  that  emerging   technologies  and                                                              
renewable resources are being reviewed.                                                                                         
                                                                                                                                
COMMISSIONER   BELL  moved   on  to   the  department's   consumer                                                              
protection  entities.   The  Division  of Banking  and  Securities                                                              
license,  charter,  and examine  banks.   Through  the  division's                                                              
consumer  education   and  protection   element,  more   than  200                                                              
mortgage  licenses were  provided.   The  division  has also  been                                                              
increasingly    involved   with    payday   lenders    and   money                                                              
transmitters.  The  division is a fee-supported  program, like the                                                              
department's other  regulatory entities.  Similarly,  the Division                                                              
of Insurance  is focused on  licensing and ensuring  the financial                                                              
solvency  of  insurance  providers  [in  the state].    Since  the                                                              
Division  of Insurance  is  involved in  criminal  investigations,                                                              
the division has  an increased involvement with  the Department of                                                              
Law.  She noted  that since the insurance products  are increasing                                                              
in their complexity,  it takes a specialized staff  to work in the                                                              
division.                                                                                                                       
                                                                                                                                
8:57:46 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  BELL   turned  to  the  Division   of  Corporations,                                                              
Business  and   Professional  Licensing,   which  administers   40                                                              
professional  licensing  programs of  which  20 are  supported  by                                                              
boards and  the remainder  by the division.   The division  issues                                                              
business  licenses and  corporations  filing  trademarks with  the                                                              
state  also interact  with this  division.  She  pointed out  that                                                              
over the  last year  or so there  has been  a concerted  effort to                                                              
reduce  response times,  use more  technology, and  to ensure  the                                                              
division  isn't creating  any delays that  would impact  commerce.                                                              
As with  the department's  other regulatory  agencies, there  is a                                                              
consumer complaint  process.  More than 700 complaints  were filed                                                              
about professional  licensing programs, which resulted  in 556 new                                                              
cases  and  397  disciplinary actions.    Commissioner  Bell  then                                                              
moved on  to the  RCA, which  she characterized  as the  fabric of                                                              
the state's infrastructure.   The RCA works with  public utilities                                                              
and  pipeline carriers  to review  tariffs, filings,  regulations,                                                              
and  establish the  PCE rates  that  AEA distributes.   This  next                                                              
year, the  RCA faces  an [increased]  work load  as there  will be                                                              
concurrent  hearings on  the Trans-Alaska  Pipeline System  (TAPS)                                                              
with RCA and the Federal Energy Regulatory Commission (FERC).                                                                   
                                                                                                                                
9:00:24 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   GARDNER  asked   whether  Commissioner   Bell  is                                                              
confident that the  RCA has sufficient staff for  these concurrent                                                              
hearings.                                                                                                                       
                                                                                                                                
COMMISSIONER  BELL  informed the  committee  that  with regard  to                                                              
RCA's staffing  overall, the  department has requested  assistance                                                              
in  reviewing the  staffing and  the compensation  to ensure  that                                                              
the RCA  is sustainable.  With  regard to the  increasing workload                                                              
of the  RCA, Commissioner  Bell expressed the  need to  speak with                                                              
the chair of the RCA.                                                                                                           
                                                                                                                                
9:01:35 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  BELL,  noting  that  the committee  already  had  an                                                              
overview  of the Division  of Economic  Development, reminded  the                                                              
committee that the  focus of the Division of  Economic Development                                                              
is  to  review  the  state's  role   in  terms  of  core  economic                                                              
development  functions.   Similar to many  other states,  regions,                                                              
and countries,  the division  provides direct financing  programs,                                                              
marketing  programs,  and  business and  technical  assistance  to                                                              
small  businesses.   Commissioner  Bell  opined that  over  recent                                                              
years  the   department's  economic   development  programs   have                                                              
diminished and  the desire now is  to make them robust  and at the                                                              
level of  the DCRA focus.   She directed  attention to page  13 of                                                              
the presentation,  which provides  a brief description  of several                                                              
of the  Division of  Economic Development  programs.   In addition                                                              
to  the Division  of Economic  Development,  the Alaska  Aerospace                                                              
Corporation,  Alaska Industrial  Development and Export  Authority                                                              
(AIDEA), and ASMI have an economic development mission.                                                                         
                                                                                                                                
COMMISSIONER  BELL,   in  conclusion,  directed   the  committee's                                                              
attention to  pages 16-18,  which relay  varying views  of DCCED's                                                              
budget.  Referring  to page 16,  she pointed out that  of the $204                                                              
million  budget request  for FY12,  nearly 60  percent is  for the                                                              
corporate  entities.   The pie chart  on page  17 illustrates  the                                                              
budget by line  item while the graph  on page 18 provides  a brief                                                              
comparison of the budget by fund source for FY11 versus FY12.                                                                   
                                                                                                                                
9:04:29 AM                                                                                                                    
                                                                                                                                
CHAIR MUNOZ  asked whether  data is available  with regard  to the                                                              
economic and social situation in each region of the state.                                                                      
                                                                                                                                
COMMISSIONER BELL  relayed that she  would like to follow  up with                                                              
the   department's  directors   regarding   what  information   is                                                              
available and then offer it to the committee.                                                                                   
                                                                                                                                
REPRESENTATIVE  SADDLER  inquired as  to  how many  state  charter                                                              
banks are in the state.                                                                                                         
                                                                                                                                
COMMISSIONER BELL  recalled that  there were 38 examinations  last                                                              
year, but  she wasn't sure how  many banks exist and  thus offered                                                              
to provide that information later.                                                                                              
                                                                                                                                
9:05:41 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GARDNER  noted that ATIA is requesting  $20 million                                                              
from  the  legislature.    She  then  questioned  what  the  State                                                              
Tourism  Office   would  do  with  that  funding.     She  further                                                              
questioned why  the legislature  wouldn't provide funding  to ASMI                                                              
since she views ASMI and ATIA as parallel organizations.                                                                        
                                                                                                                                
^Serve Alaska                                                                                                                   
                          Serve Alaska                                                                                      
                                                                                                                              
9:07:18 AM                                                                                                                    
                                                                                                                                
CHAIR MUNOZ  announced that the  final order of business  would be                                                              
an overview of Serve Alaska within DCCED.                                                                                       
                                                                                                                                
9:07:54 AM                                                                                                                    
                                                                                                                                
NITA  MADSEN, Director,  Serve Alaska,  State Service  Commission,                                                              
began by  informing the  committee that the  purpose of  the State                                                              
Service  Commission  is  to  engage   Alaskans  of  all  ages  and                                                              
backgrounds  in community-based  service  and  volunteerism.   Ms.                                                              
Madsen emphasized that  the benefits of Serve Alaska  are great in                                                              
terms  of  the  numbers  listed  in the  report  provided  to  the                                                              
committee  as well as  how each  life is  touched.  She  explained                                                              
that  Serve  Alaska is  the  conduit  for receiving  the  national                                                              
funding  for community  service.   Serve  Alaska  sub grants  that                                                              
funding   to  local   governments,   tribal  entities,   nonprofit                                                              
organizations,  institutions  of  higher  education,  as  well  as                                                              
departments  and divisions  of the  state.   Serve Alaska  assists                                                              
the aforementioned  entities in  their efforts  to meet  the local                                                              
needs   through   the   areas   of   education,   public   safety,                                                              
environment,  and  other  human   needs.    Serve  Alaska  manages                                                              
AmeriCorps  Programs and  the Learn  and  Serve America  Programs.                                                              
The Learn  and Serve America  Programs combine classroom  learning                                                              
and community  service activities  to engage  students in  service                                                              
through  community partnerships  to  promote an  ethic of  service                                                              
that  would develop  student  leadership,  skills, and  character.                                                              
The  primary element  of  service  learning, she  highlighted,  is                                                              
that  the   projects  are   directly  linked   to  the   classroom                                                              
curriculum.     The   service   projects   provide  students   the                                                              
opportunity to utilize their skills.                                                                                            
                                                                                                                                
MS.  MADSEN informed  the committee  that  currently Serve  Alaska                                                              
has  the  following  three  grantees  with  the  Learn  and  Serve                                                              
America  Programs  funding:    the  Yup'ik  School  District,  the                                                              
Begich  Middle  School,  and  the  LINKS  Mat-Su  Parent  Resource                                                              
Center.   The Yup'ik  School District funding  is with  the school                                                              
of  Akiak.   The project  with Akiak  stems  from the  community's                                                              
concern with  the suicide  rate and  desire to  decrease it.   The                                                              
project resulted  in a garden project that encompassed  the entire                                                              
school.  Ultimately,  the project included a green  house, raising                                                              
rabbits,  and  composting.   The  project  received  a  three-year                                                              
grant  and is  in  the second  year  of that  grant.   Ms.  Madsen                                                              
emphasized  that everyone in  the community  has been  involved in                                                              
the project  in some fashion.   Furthermore, an  AmeriCorps member                                                              
helped  engage  the  students  over   the  summer  to  expand  the                                                              
project.   Under the project,  the high school students  performed                                                              
water  testing in  the community.    The testing  resulted in  the                                                              
entire community  trying to determine  how to improve  the quality                                                              
of the  water, such as  moving the dump  site.  The  Akiak project                                                              
is an example of  how a little bit of funding  can unite folks and                                                              
support some  creative solutions.   In  this particular  case, the                                                              
knowledge the elders  brought and the new linkage to  the youth is                                                              
notable.   The Begich Middle School  program took on  a composting                                                              
project and  now is  doing an  in-school green  house.   The LINKS                                                              
Mat-Su Parent  Resource Center  is an  alternative school  for 7th                                                              
to 12th graders  that is working with a local senior  center.  The                                                              
LINKS  Mat-Su  Parent Resource  Center  had  a potato  patch  this                                                              
summer  and  served  meals  at the  local  senior  center.    This                                                              
project  works with  nutrition,  math skills,  and social  skills.                                                              
Again,  she highlighted  the  linkage between  the  youth and  the                                                              
elders,  particularly since  it seems  to mitigate  the fear  that                                                              
some of the elders  felt towards the youth and  the youth learning                                                              
how to be more patient.                                                                                                         
                                                                                                                                
9:13:32 AM                                                                                                                    
                                                                                                                                
MS.  MADSEN then  turned  to the  AmeriCorps  programs, which  she                                                              
surmised  the committee  already  knows  much about.    Currently,                                                              
there are five grantees  in 63 communities around the  state.  The                                                              
aforementioned  is  a bit  of  a  moving target  since  AmeriCorps                                                              
volunteers  serve 300-1,700  hours  in  a year.    She noted  that                                                              
those  who   serve  less   than  900   hours  don't  receive   any                                                              
remuneration.    However, upon  completion  of their  service  all                                                              
AmeriCorps   members  are   eligible  for   an  education   award.                                                              
AmeriCorps  members  range  in  age  from 17-92.    In  fact,  the                                                              
program is  starting to see  a lot of  members who are  starting a                                                              
new  career and  wanting to  give back.   As  an incentive,  those                                                              
members who have  become an AmeriCorps member after  the age of 50                                                              
are  allowed to  move  their education  award  to their  children,                                                              
grand children, or foster children.                                                                                             
                                                                                                                                
9:14:51 AM                                                                                                                    
                                                                                                                                
MS. MADSEN  moved on to RurAL Cap  that has four programs,  one of                                                              
which  is the  Student  Service  Program,  which is  an  education                                                              
award  only program  that's  linked  with the  state  university's                                                              
nursing  and social  work students  who  perform service  projects                                                              
around the community.   The partnership is through  the University                                                              
of Alaska Anchorage  and the University of Alaska  Fairbanks.  The                                                              
Raven program is  an energy program while Birch  is a health-based                                                              
program  in  the rural  communities.    The  newest project  is  a                                                              
middle school project  with the Department of Education  and Early                                                              
Development  (EED)  in  eight communities  to  help  build  school                                                              
success early on in order to increase graduation rates.                                                                         
                                                                                                                                
MS. MADSEN related  that Serve Alaska's Southeast  Alaska Guidance                                                              
Association  (SAGA) Program  is  well known  in  Juneau, where  it                                                              
takes  on  a summer  project  in  which  it primarily  works  with                                                              
disconnected youth.   This program performs trail  work, addresses                                                              
invasive  species,  clears brush  along  the roadways,  and  helps                                                              
local nonprofits  construct  playgrounds.   One of the  components                                                              
of  the program  for  these disconnected  youth  is the  education                                                              
component  through which  the youth  are  either completing  their                                                              
general equivalency  diploma (GED) or obtaining their  high school                                                              
diploma.   Many  of the  members [of  SAGA] return  home to  their                                                              
communities to complete  their education or move on  to a military                                                              
career.   The Vocational Technical  Center in Seward has  used its                                                              
awards fairly consistently.   Ms. Madsen noted that  SAGA also has                                                              
a single  placement program called  Connections, which  works with                                                              
youth in  a variety of ways  to help youth make  healthy lifestyle                                                              
choices.   Therefore,  the  member  as well  as  the community  is                                                              
receiving a benefit.                                                                                                            
                                                                                                                                
MS. MADSEN  then turned  to the  Ninestar Program, which  performs                                                              
education employment  services.  In the last couple  of years, the                                                              
program   has  worked   with   prisoner   re-entry  programs   and                                                              
experienced much  success with it.   The program also  helps folks                                                              
move off the  public assistance rolls through English  as a second                                                              
language  and development  of soft skills,  such as  how to  go to                                                              
work and  find child  care assistance.   A  new program  is Joel's                                                              
Place  in Fairbanks  for which  homeless  youth age  17-25 is  its                                                              
target  population.     These   youth  are  learning   skill-based                                                              
services  and  then  utilizing  those  skills  in  the  community.                                                              
Joel's  Place  utilizes  some  of  the same  pieces  of  the  SAGA                                                              
Program that  work with  a lot  of construction  set skills  as is                                                              
the case  with the Sitka program.   She mentioned that  houses are                                                              
actually being  built; these are  houses that are  affordable low-                                                              
income  houses.     The  SAGA   Program  in  Sitka   is  obtaining                                                              
certificates   to   assist   them  with   construction   and   the                                                              
participants  are often  being picked  up by  employers for  their                                                              
skills.                                                                                                                         
                                                                                                                                
9:18:53 AM                                                                                                                    
                                                                                                                                
MS. MADSEN  expressed appreciation  for last  year's funding,  but                                                              
noted that there  is a new position in the office  and through the                                                              
granting  process new  entities  have  applied.   The  hope is  to                                                              
expand Serve  Alaska's portfolio of  services.  One of  the recent                                                              
program  applicants  is senior  disabilities  through  DHSS.   The                                                              
program  would place  folks in  rural communities  to assist  with                                                              
their knowledge  regarding Medicaid and  how to access it.   Also,                                                              
the  Sealife  Seward  Center  has been  a  subset  for  AmeriCorps                                                              
members  for a  number of  years,  but they  are increasing  their                                                              
numbers to expand in the Seward area.                                                                                           
                                                                                                                                
9:20:14 AM                                                                                                                    
                                                                                                                                
MS.  MADSEN,  in response  to  Representative  Gardner,  indicated                                                              
that  sometimes how  youth dress  these days  along with  seniors'                                                              
increasing  knowledge  about  the  existence of  gangs  have  made                                                              
seniors afraid of  youth.  She clarified that she  was speaking of                                                              
this   in  the   urban  environment   more  than   in  the   rural                                                              
environment.   She noted that she  also sits on the  Commission of                                                              
Aging from which  she has gathered that seniors are  afraid of the                                                              
youth with  regard to financial  abuse because the  seniors become                                                              
the parents of the children.                                                                                                    
                                                                                                                                
REPRESENTATIVE FOSTER  asked if Ms. Madsen has  a map illustrating                                                              
the locations of the volunteers around the state.                                                                               
                                                                                                                                
MS.  MADSEN related  that  although  the committee  packet  should                                                              
include such  a map,  she could  provide members  a larger  map as                                                              
well as  a summary sheet  of the various  volunteer programs.   In                                                              
further response  to Representative  Foster, Ms. Madsen  explained                                                              
that  Serve Alaska  only  recently  submitted an  application  and                                                              
it's  28 percent  more than  Serve  Alaska received  in the  prior                                                              
year.   There were  six new  applicants this  year, of  which four                                                              
were moved forward  for funding.  She noted that  there has been a                                                              
lot of interest  in increasing the number of  [applicants] and the                                                              
[new]  staff position  will enable  that  to occur.   She  related                                                              
that  the funding  agency  has  told  Serve Alaska  that  existing                                                              
staff is  at maximized  capacity on managing  the grants  and thus                                                              
wouldn't  consider Serve  Alaska expandable  until there  is staff                                                              
[to manage  the grants].  The results  of the funding  will not be                                                              
ready until the  end of May.  [This increase in  funding] will add                                                              
approximately 158 AmeriCorps member positions to the state.                                                                     
                                                                                                                                
9:24:41 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  CISSNA,  noting   that  she  has  seen  AmeriCorps                                                              
volunteers working  and making a difference, expressed  favor with                                                              
the  addition of  adolescent volunteers  with great  energy.   She                                                              
then related her appreciation of the job of Serve Alaska.                                                                       
                                                                                                                                
REPRESENTATIVE SADDLER  asked whether Serve Alaska  expects future                                                              
federal funding reductions.                                                                                                     
                                                                                                                                
MS. MADSEN  responded that Serve  Alaska is currently  working off                                                              
of a continuing  resolution for  the funding.  Although  there has                                                              
been  discussion  of  the  funding  being at  the  2008  level  of                                                              
funding,  it  remains   an  unknown.    She  predicted   that  the                                                              
[federal] funding  will be slightly less for  Serve Alaska because                                                              
the funding  last year was  at the 2008  level.  Therefore,  Serve                                                              
Alaska  may have  a  greater opportunity  for  its  funding to  be                                                              
approved, particularly  since the [federal government]  is seeking                                                              
to  increase  its  rural  portfolio.     In  further  response  to                                                              
Representative  Saddler,  Ms.  Madsen  agreed that  there  is  the                                                              
possibility of an increase in the future.                                                                                       
                                                                                                                                
CHAIR MUNOZ inquired as to the amount of the education award.                                                                   
                                                                                                                                
MS.  MADSEN  explained the  education  award  amount is  the  Pell                                                              
grant  amount, which  is established  in October.   The amount  is                                                              
slightly over $5,000  this year.  She clarified that  the grant is                                                              
per year  of service  and is proportionate  to the service  hours.                                                              
She indicated  that the [$5,000] is  at the 1,700-hour  level.  In                                                              
further response  to Chair Munoz, Ms. Madsen  confirmed that Serve                                                              
Alaska does get information out to graduating seniors.                                                                          
                                                                                                                                
9:28:41 AM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no further business before the committee, the House                                                                 
Community and Regional Affairs Standing Committee meeting was                                                                   
adjourned at 9:28 a.m.