SENATE TRANSPORTATION COMMITTEE May 2, 1996 3:26 p.m. MEMBERS PRESENT Senator Steve Rieger, Chairman Senator Robin Taylor, Vice Chair Senator Lyda Green Senator Al Adams Senator Georgianna Lincoln MEMBERS ABSENT All members present COMMITTEE CALENDAR CS FOR HOUSE BILL NO. 526(FIN) am "An Act relating to the financing authority, programs, operations, and projects of the Alaska Industrial Development and Export Authority; providing an exemption from the procurement code for certain projects of the authority; and providing for an effective date." PREVIOUS SENATE ACTION HB 526 - See Senate Transportation minutes dated 4/16/96, 4/23/96 & 4/26/96. ACTION NARRATIVE TAPE 96-22, SIDE A Number 001 CSHB 526 AIDEA(FIN) am OPERATIONS/PROJECTS/LOANS  CHAIRMAN RIEGER called the Senate Transportation Committee meeting to order at 3:26 p.m., and brought HB 526 before the committee. He directed attention to a proposed SCS CSHB 526(TRA) version "R" dated 5/1/96. Number 012 SENATOR TAYLOR moved adoption of SCS CSHB 526(TRA) for purposes of discussion. Hearing no objection, it was so ordered. Number 020 CHAIRMAN RIEGER outlined the following changes made in the Transportation SCS, which was before the committee: (1) Section 1: The language in the House version "related to an integrated transportation facility" has been changed to "made with the developer of an integrated transportation." (2) Section 2: The language is entirely new. Section 2 adds to the Alaska Statutes a minimum formula for payment of a dividend to the state each fiscal year. The amount of the dividend for a fiscal year may not be less than 40 percent of the net income of the authority for that fiscal year, unless that amount exceeds the total unrestricted net income of the authority for that year, etc. (3) Section 3: The issuance of bonds of greater than $10,000,000 to assist in the financing of a development project has been reinstated, as well as adding a sunset date of July 1, 1998. (4) Section 6: Language has been added describing the interest rate on loans which are not purchased from borrowed funds, but instead, purchased from the general assets of the authority. It provides that if it is a tax exempt type of project, the rate would be what it would have been if it were bonded at tax exempt rates for that project. If it's a taxable type, it would be at the taxable rates. (5) Section 10: On page 5, line 13 the words "up to" were added in language which refers to the guarantee of a loan. It gives the flexibility to guarantee less than 80 percent. (6) Section 13: On page 6, line 16 it was felt the language "protection of the authority's interest" was too broad and that has been changed to "protection of the authority's interest in a loan or loan guarantee." (7) Section 14: "Prime rate" has been further defined as the United States prime rate. (8) Section 18: The repealer of the Midrex authorization has been changed to a modification of the Midrex language. Instead of referencing the Midrex project, it references a bulk commodity loading and shipping terminal, which may located anywhere within Cook Inlet. This authorization would be subject to the ordinary tests of feasibility that are elsewhere in the AIDEA statutes. (9) Section 19: This is an extension of additional sunset provisions in the bill to July 1, 1998 instead of repealing on July 1, 1996. (10) Section 21: This is a repealer of the Business Assistance Loan Guarantee program. (11) Section 22: This is transition language that was added in Senate State Affairs. There is new transition language on lines 10 through 12 referring to the dividend payment. Number 112 CHAIRMAN RIEGER asked if there was any testimony on SCS CSHB 526(TRA). Hearing none, he asked for the pleasure of the committee. SENATOR TAYLOR moved SCS CSHB 526(TRA) be passed out of committee with individual recommendations. He commented that he would have liked to see the Bradfield project in the bill, but it is his understanding they will be able to do that through other authority, if a feasible project is developed. Hearing no objection, the Chairman stated the motion carried. There being no further business to come before the committee, the meeting was adjourned at 3:34 p.m.