Legislature(2009 - 2010)CAPITOL 106

03/23/2010 05:15 PM ECON. DEV., TRADE & TOURISM


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05:17:44 PM Start
05:17:54 PM HCR21
06:09:52 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HCR 21 ECONOMIC DEVELOPMENT PLANNING COMMISSION TELECONFERENCED
Moved CSHCR 21(EDT) Out of Committee
        HCR 21-ECONOMIC DEVELOPMENT PLANNING COMMISSION                                                                     
                                                                                                                                
5:17:56 PM                                                                                                                    
                                                                                                                                
CHAIR RAMRAS announced the only  order of business would be HOUSE                                                               
CONCURRENT  RESOLUTION  NO.  21,  Creating and  relating  to  the                                                               
Economic   Development  Planning   Commission.     He  identified                                                               
Committee  Substitute  to  HCR  21,  26-LS1446\S,  Cook,  as  the                                                               
document before the committee.                                                                                                  
                                                                                                                                
5:18:43 PM                                                                                                                    
                                                                                                                                
ROB  EARL,   staff,  Representative  Bob  Herron,   Alaska  State                                                               
Legislature, informed the  committee that HCR 21  is sponsored by                                                               
the House  Community and Regional  Affairs Committee that  is co-                                                               
chaired  by Representatives  Munoz  and Herron.   The  resolution                                                               
creates  a ten-member  Economic  Development Planning  Commission                                                               
that  would act  as a  task force  in the  legislative branch  of                                                               
government,  and that  is funded  through the  Alaska Legislative                                                               
Council  budget.   He  advised  an  HCR  is  a "letter  from  the                                                               
legislature to  itself," and thus does  not need to be  signed by                                                               
the  governor, nor  is it  subject to  veto.   The intent  of the                                                               
resolution  is to  create a  bridge between  economic development                                                               
ideas and  the action necessary to  finalize related legislation.                                                               
The   resolution  includes   a  6/30/12   sunset  date   for  the                                                               
commission.                                                                                                                     
                                                                                                                                
5:22:23 PM                                                                                                                    
                                                                                                                                
ERIN  HARRINGTON, staff,  Representative  Alan Austerman,  Alaska                                                               
State  Legislature,  said  HCR  21 fulfils  two  purposes:    (1)                                                               
creates  a tool  by  which the  legislature  can monitor  ongoing                                                               
economic  development initiatives;  (2)  creates  a mechanism  by                                                               
which  the legislature  can collaborate  with the  private sector                                                               
and  identify   where  state  government  can   support  economic                                                               
development.  Ms.  Harrington pointed out that  the resolution is                                                               
also  a  response  to shortcomings  found  in  previous  economic                                                               
development efforts and processes.   One of the current statewide                                                               
processes  is  Alaska  Forward,  which   is  led  by  the  Alaska                                                               
Partnership  for  Economic   Development  (ADEP),  a  partnership                                                               
between the  Alaska Regional Development  Organizations (ARDORs),                                                               
and  other groups.   Alaska  Forward received  $500,000 from  the                                                               
Denali  Commission and  is working  on funding  for its  Phase 11                                                               
tasks.  Another ongoing process  is Legacy, which was established                                                               
by  an administrative  order from  the Palin  Administration, and                                                               
that is another effort directed  at long-term, strategic planning                                                               
for  economic  development.    She   displayed  slide  5  titled,                                                               
"Alaska's Economic Development 'System'"  that identified some of                                                               
the  different  organizations  involved in  economic  development                                                               
efforts at  the state, regional,  borough, and  municipal levels.                                                               
Slide  6 listed  the kinds  of opportunities  the commission  may                                                               
identify such  as: financial tools that  need to be set  in place                                                               
by  statutory action;  targeting  industry "clusters";  preparing                                                               
the legislature  in advance of  the session to address  the needs                                                               
of   economic   development   organizations;   restructuring   of                                                               
departments that relate to economic development.                                                                                
                                                                                                                                
5:28:14 PM                                                                                                                    
                                                                                                                                
MR.  EARL  presented  slide  7  that  displayed  the  appointment                                                               
authority for the  membership of the commission.   He pointed out                                                               
that the commissioners of the  Department of Commerce, Community,                                                               
&  Economic Development  (DCCED) and  the Department  of Labor  &                                                               
Workforce  Development (DLWD)  are  appointed automatically,  and                                                               
are ex  officio, non-voting  members.   In addition,  all members                                                               
serve until  the sunset  date of  6/30/12.   Slide 8  displayed a                                                               
timeline  for HCR  21  as follows:  March,  2010, Alaska  Forward                                                               
Phase 1  Report; April 30,  2010, or when members  are appointed,                                                               
whichever is earlier,  commission  begins work; January 30, 2011,                                                               
first  legislative  report  deadline;  2011  (tentative),  Alaska                                                               
Forward  Phase  11 report;    December  15, 2011,  second  report                                                               
deadline;  June  30, 2012, sunset.  Mr. Earl  observed that there                                                               
is a  consensus in the business  community that there is  a "lack                                                               
of  cohesive thinking  on economic  development  in Alaska,"  and                                                               
although Alaska Forward is making  progress, the commission would                                                               
help implement  the ideas advanced  by Alaska Forward.   Slide 10                                                               
reviewed the documents  provided in the committee  packet.  Slide                                                               
11 was a breakdown of the  fiscal note:  $130,000 total; $108,000                                                               
for commission staff;  $11,000 for travel; $11,000  for per diem.                                                               
The  fiscal note  was written  under  the following  assumptions:                                                               
three  meetings require  travel;  one Anchorage  meeting and  two                                                               
Fairbanks meetings;  per diem  for two  days per  travel meeting;                                                               
three Anchorage-based  members, one Fairbanks-based member.   Mr.                                                               
Earl concluded his testimony.                                                                                                   
                                                                                                                                
5:32:26 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CRAWFORD expressed his  disappointment at the lack                                                               
of input from the minority side  of the legislature.  In response                                                               
to  Chair  Ramras, he  clarified  that  he referred  to  minority                                                               
members, not minority party members.                                                                                            
                                                                                                                                
5:33:47 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN asked  whether there is a  provision in the                                                               
resolution  that would  prevent  the Speaker  of  the House,  the                                                               
Senate  President, or  the co-chairs  from appointing  a minority                                                               
member.                                                                                                                         
                                                                                                                                
MS. HARRINGTON said no.                                                                                                         
                                                                                                                                
5:34:33 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT,  in his  role as  Speaker of  the House,                                                               
assumed that either  the [Speaker of the House]  or the President                                                               
of  the  Senate  would  choose   the  members  to  serve  on  the                                                               
committee, and not the finance committee co-chairs.                                                                             
                                                                                                                                
5:35:21 PM                                                                                                                    
                                                                                                                                
CHAIR RAMRAS identified the relevant  provision of the resolution                                                               
at page 2, lines 4-6, and  suggested an amendment may be required                                                               
to correlate with the PowerPoint presentation.                                                                                  
                                                                                                                                
5:36:01 PM                                                                                                                    
                                                                                                                                
MR.  EARL  clarified  that  the   information  presented  in  the                                                               
PowerPoint coincides with Version S.                                                                                            
                                                                                                                                
5:36:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT misunderstood "chair"  to be the chair of                                                               
the legislative council.                                                                                                        
                                                                                                                                
5:36:46 PM                                                                                                                    
                                                                                                                                
CHAIR RAMRAS opened the hearing for public testimony.                                                                           
                                                                                                                                
5:37:26 PM                                                                                                                    
                                                                                                                                
SUSAN  BELL, Special  Staff Assistant,  Office  of the  Governor,                                                               
stated that she is working  with the Department of Revenue (DOR),                                                               
and   the  Department   of   Commerce,   Community,  &   Economic                                                               
Development  (DCCED),   on  four   fronts  related   to  economic                                                               
development.  Firstly, while  representing the governor's office,                                                               
she served  on the steering  committee of Alaska Forward  and was                                                               
involved  in  the Legacy  process  as  well.   Secondly,  at  the                                                               
departmental level, there has been  a bolstering of staff for the                                                               
Office  of Economic  Development  within DCCED,  and interest  in                                                               
"where the  division is  going."  Thirdly,  Ms. Bell  pointed out                                                               
the number  of bills relating  to economic development  that have                                                               
been introduced by the governor, and  she said the fourth part of                                                               
the governor's  plan is  to preserve  some elements  from Legacy,                                                               
the economic  development planning process established  by former                                                               
Governor Palin.   She continued to explain  that Governor Parnell                                                               
is interested in  preserving the Legacy element  of a sub-cabinet                                                               
planning team  consisting of: the  commissioners or  designees of                                                               
DCCED, the  Department of Labor  & Workforce  Development (DLWD),                                                               
and  the   Department  of  Transportation  &   Public  Facilities                                                               
(DOT&PF); the  executive directors of the  Alaska Housing Finance                                                               
Corporation (AHFC),  the Alaska  Energy Authority (AEA),  and the                                                               
Alaska  Industrial Development  & Export  Authority (AIDEA);  the                                                               
president  of the  University of  Alaska  (UA); a  representative                                                               
from the Office  of the Governor.  In fact,  further revisions to                                                               
the administrative  order are  in progress.   The  Legacy process                                                               
also   organized  13   industry-specific  workgroups   that  have                                                               
produced interim  reports that  have been  reviewed by  DCCED and                                                               
the governor's  staff.   Referring again  to Alaska  Forward, she                                                               
advised  that the  workgroups  from Legacy  will  be merged  with                                                               
"industry cluster groups," under  Alaska Forward, to bring state,                                                               
regional, and  industry leaders from the  private sector together                                                               
with state  agencies.  Ms.  Bell advised  that at this  time, the                                                               
administration is  reviewing reports produced by  Legacy, forming                                                               
hoc  groups to  meet  with the  governor,  bolstering staff,  and                                                               
advancing legislation.   She concluded  that the  commission will                                                               
be "another  body that  will be very  instrumental in  helping us                                                               
implement  things  that are  coming  out  of  a number  of  these                                                               
different initiatives, as well as our own department."                                                                          
                                                                                                                                
5:42:31 PM                                                                                                                    
                                                                                                                                
MS.  BELL,   in  response   to  Representative   Neuman,  further                                                               
described  the  efforts  to  bring   Legacy  and  Alaska  Forward                                                               
together, rather  than having two independent  sets of workgroups                                                               
working on tasks.   The logical point  at which to do  this is in                                                               
Phase 11 of Alaska Forward,  where the governor can interact with                                                               
the  groups   at  a  personal   level,  and  also   preserve  the                                                               
subcabinet.                                                                                                                     
                                                                                                                                
5:43:41 PM                                                                                                                    
                                                                                                                                
WAYNE  STEVENS,  President  and  CEO,  Alaska  State  Chamber  of                                                               
Commerce,  informed the  committee  the Alaska  State Chamber  of                                                               
Commerce   is   a    statewide,   non-profit,   membership-funded                                                               
organization, and its  mission is to promote  a positive business                                                               
environment in Alaska.   The Chamber's members  represent a broad                                                               
spectrum  of Alaskan  businesses, from  the resource  and tourism                                                               
industries,  the   service  and  transportation   sector,  Native                                                               
corporations, and  a variety  of other  business interests.   Mr.                                                               
Stevens said the development of  a strategic economic development                                                               
plan has  been a  top legislative  priority of  his organization.                                                               
He spoke  in support of Legacy,  Alaska Forward, and HCR  21, and                                                               
pointed out that strategic economic  development cannot happen in                                                               
a  vacuum; in  fact, it  is  critical that  the legislature,  the                                                               
administration, the  business community, and the  university work                                                               
collaboratively to  create a strategic economic  development plan                                                               
for  Alaska's future.   He  advised the  Alaska State  Chamber of                                                               
Commerce supports HCR 21.                                                                                                       
                                                                                                                                
5:46:22 PM                                                                                                                    
                                                                                                                                
ANDY  VARNER,  Executive  Director,  Southwest  Alaska  Municipal                                                               
Conference  (SWAMC), informed  the committee  that the  Southwest                                                               
Alaska  Municipal  Conference  (SWAMC)   is  an  Alaska  Regional                                                               
Development  Organization  (ARDOR),  and  a  founding  and  board                                                               
member  of  the  Alaska   Partnership  for  Economic  Development                                                               
(APED),  the  organization  that  undertook  the  Alaska  Forward                                                               
initiative.   Mr. Varner encouraged  the committee to  review the                                                               
Phase 1 report issued by Alaska  Forward.  He stated that SWAMC's                                                               
mission is  to advance economic development  in Southwest Alaska,                                                               
and is  responsible for the  region's economic  development plan.                                                               
Regarding  the   resolution,  SWAMC  supports  HCR   21  and  the                                                               
establishment of  an economic  development planning  committee to                                                               
oversee visions and strategies, and  to serve as a clearing house                                                               
for the legislature regarding  economic development activities in                                                               
the state.  The commission's value  to lawmakers is that it would                                                               
serve  as  a starting  point  for  necessary policy  changes,  or                                                               
regulatory and  management discussions,  arising from  the Alaska                                                               
Forward or Legacy initiatives.   Most importantly, the commission                                                               
would be  a mutual partnership  between state government  and the                                                               
private  sector,  and is  structured  so  that both  parties  are                                                               
"marching step-in-step."  Mr. Varner  summarized that this effort                                                               
to  streamline  activities  that  strengthen  and  diversify  the                                                               
state's economy is the reason SWAMC is in support of HCR 21.                                                                    
                                                                                                                                
5:48:44 PM                                                                                                                    
                                                                                                                                
MARTY METIVA, Executive Director,  Mat-Su Resource Conservation &                                                               
Development  (RC&D); President,  Alaska Partnership  for Economic                                                               
Development (APED), stated he was  testifying as the president of                                                               
APED.  He  gave a brief update of the  Alaska Forward project and                                                               
clarified  that  Phase  1 completed  a  situational  analysis  of                                                               
"where  we  are  now,"  by   hiring  consultants  and  conducting                                                               
surveys.  Of  interest was the response of over  300 business and                                                               
community  leaders that  indicated: 52  percent felt  the state's                                                               
economic  development efforts  are ineffective;  61 percent  felt                                                               
the  outlook  for  Alaska's  economy  in the  next  10  years  is                                                               
uncertain; 2.5 percent felt the  economic development efforts are                                                               
very  effective;   6  percent  felt  the   outlook  for  economic                                                               
development efforts are  very good; they felt there is  a lack of                                                               
leadership at the  state level.  He opined HCR  21 addresses this                                                               
issue by  developing the private  and public partnership  that is                                                               
needed  for economic  development, as  has been  proven in  other                                                               
states.  Mr.  Metiva expressed his support  of the implementation                                                               
process within the resolution, because  this is the part that has                                                               
always been missing.  He concluded  that APED and the Mat-Su RC&D                                                               
fully support the resolution.                                                                                                   
                                                                                                                                
5:53:44 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN inquired as to the lack of leadership.                                                                    
                                                                                                                                
5:54:08 PM                                                                                                                    
                                                                                                                                
MR. METIVA explained that many  respondents to the on-line survey                                                               
mentioned this in their general comments in the questionnaire.                                                                  
                                                                                                                                
5:54:46 PM                                                                                                                    
                                                                                                                                
CHRISTI   BELL,   Executive   Director,   Center   for   Economic                                                               
Development, University of Alaska  Anchorage (UAA), University of                                                               
Alaska (UA),  informed the  committee the  mission of  the Center                                                               
for Economic Development is to  leverage the UA system to support                                                               
statewide  economic  development.   Ms.  Bell  stated she  was  a                                                               
member of the  steering committee on the  Alaska Forward project,                                                               
that  her organization  is a  member of  APED, and  that she  was                                                               
closely  involved with  the Legacy  process.   She expressed  her                                                               
support of  HCR 21 as a  bridge that brings the  legislative body                                                               
into the  economic development  conversation, and  encourages the                                                               
legislature to  be more  engaged in  a collaborative  approach to                                                               
economic  development.    Ms.  Bell   agreed  with  the  previous                                                               
speakers that the  process should be more inclusive,  not only of                                                               
the  private   industry  and  private  entities,   but  of  state                                                               
agencies,  the   legislature,  institutes  of   higher  learning,                                                               
economic development  organizations, and others.   She encouraged                                                               
the  incorporation  of language  into  HCR  21 that  ensures  the                                                               
participation  of nonprofit  organizations,  Alaska Forward,  and                                                               
Legacy.                                                                                                                         
                                                                                                                                
5:57:47 PM                                                                                                                    
                                                                                                                                
CURTIS THAYER,  Deputy Commissioner, Office of  the Commissioner,                                                               
Department  of   Commerce,  Community,  &   Economic  Development                                                               
(DCCED),  said, "Legislation  such as  this, I  feel is  needed."                                                               
Presently,  the  Office of  Economic  Development  (OED) and  his                                                               
department  have established  an 120-day  action plan  that began                                                               
with  an inventory  of over  100  economic development  projects,                                                               
from  this   and  previous  administrations.     The  DCCED  also                                                               
completed  an analysis  of economic  challenges,  and is  working                                                               
with Alaska  Forward to create  a non-governmental  structure for                                                               
an economic board.  Mr. Thayer  said his department is in support                                                               
of  funding  in  the  amount  of  $100,000  for  Alaska  Forward.                                                               
Furthermore, the department has hired  a new director of the OED,                                                               
and  identified   a  business  outreach  officer   to  facilitate                                                               
projects with the  private sector, and to serve  as an ombudsman.                                                               
The  DCCED  is  working  with  other  state  agencies  to  remove                                                               
impediments for  growth and to  promote investment in  the state,                                                               
is  reviewing  Legacy  and its  future  combination  with  Alaska                                                               
Forward,  and  is  working  with a  community  outreach  plan  to                                                               
encourage community involvement.   The department is also meeting                                                               
with  the  Alaska  Industrial   Development  &  Export  Authority                                                               
(AIDEA),  the  Alaska  Seafood Marketing  Institute  (ASMI),  the                                                               
Alaska  Travel  Industry  Association (ATIA),  and  other  state-                                                               
funded  organizations.    There  are also  fishing,  mining,  and                                                               
mariculture opportunities  to be explored.   He pointed  out that                                                               
the  department's  participation  with the  Alaska  Alliance  for                                                               
Cruise  Travel  (AlaskaACT)  at   the  Seatrade  Cruise  Shipping                                                               
conference in  Florida, was  an example of  a private  and public                                                               
partnership working to bring tourism  back to Alaska.  Mr. Thayer                                                               
concluded "we have a fairly new  team in place, we're making some                                                               
changes within the staffing structure  of OED within the [DCCED],                                                               
so we're more pro-active."                                                                                                      
                                                                                                                                
6:02:27 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN asked for information on Alaska Forward.                                                                  
                                                                                                                                
6:02:44 PM                                                                                                                    
                                                                                                                                
MR.  THAYER  explained that  Alaska  Forward  was funded  by  the                                                               
Denali Commission and  looks at economic planning  for the state.                                                               
In  fact,  Legacy  will  transition  into  Alaska  Forward.    He                                                               
cautioned  that related  entities should  not be  in competition,                                                               
and  opined Alaska  Forward, because  it utilizes  private sector                                                               
and  regional input,  is  "where the  state needs  to  go."   Mr.                                                               
Thayer advised that  Governor Parnell's vision is  not "the state                                                               
leading the effort; we can  foster economic development, but also                                                               
the State of Alaska needs to know  when to step back and stay out                                                               
of  the   way."    He   concluded  that  projects   with  private                                                               
involvement are most likely to success.                                                                                         
                                                                                                                                
6:04:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN asked  whether  Alaska  Forward will  work                                                               
with the private sector.                                                                                                        
                                                                                                                                
6:04:46 PM                                                                                                                    
                                                                                                                                
MR. THAYER indicated yes.                                                                                                       
                                                                                                                                
6:04:58 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN suggested  increases to  funding for  ASMI                                                               
might be shared with entities that promote sport fishing.                                                                       
                                                                                                                                
MR. THAYER said he cannot speak  for ASMI, although the OED could                                                               
look at that.                                                                                                                   
                                                                                                                                
CHAIR RAMRAS closed public testimony.                                                                                           
                                                                                                                                
6:07:54 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN moved to report  HCR 21, Version [S] out of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal notes.                                                                                                                   
                                                                                                                                
REPRESENTATIVE TUCK objected.                                                                                                   
                                                                                                                                
6:08:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  offered Conceptual  Amendment [1]  to change                                                               
Version S,  page 2,  [paragraphs 3  and 4],  to allow  one public                                                               
member to  be appointed by a  minority leader in the  Senate, and                                                               
one public  member to be  appointed by  a minority leader  in the                                                               
House.                                                                                                                          
                                                                                                                                
6:09:07 PM                                                                                                                    
                                                                                                                                
CHAIR  RAMRAS announced  that Conceptual  Amendment 1  was before                                                               
the committee.   Seeing no objection, Conceptual  Amendment 1 was                                                               
adopted.   The  committee substitute  for HCR  21, Version  S, as                                                               
amended, was before the committee.                                                                                              
                                                                                                                                
6:09:15 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  removed  his  objection  to  the  Committee                                                               
Substitute to HCR 21, Version S, as amended.                                                                                    
                                                                                                                                
6:09:52 PM                                                                                                                    
                                                                                                                                
There being  no objection,  CSHCR 21(EDT)  was reported  from the                                                               
House  Special Committee  on Economic  Development, International                                                               
Trade and Tourism.                                                                                                              

Document Name Date/Time Subjects
Alaska Forward Project Executive Summary.pdf HEDT 3/23/2010 5:15:00 PM
HCR 21
Briefing Paper Economic Development in State Government.pdf HEDT 3/23/2010 5:15:00 PM
HCR 21
Chart of Econ Dev Orgs.PDF HEDT 3/23/2010 5:15:00 PM
HCR 21
FN HCR21-LEG-COU-3-11-10.pdf HEDT 3/23/2010 5:15:00 PM
HCR 21
HCR 21 sponsor statement final.doc HEDT 3/23/2010 5:15:00 PM
HCR 21