Legislature(2015 - 2016)BELTZ 105 (TSBldg)
04/07/2016 01:30 PM Senate LABOR & COMMERCE
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HB 314-AK REG ECON ASSIST. PROGRAM; EXTEND 2:57:46 PM CHAIR COSTELLO announced the consideration of HB 314. She noted that this is the first hearing on the bill. 2:58:21 PM REPRESENTATIVE SHELLEY HUGHES, Alaska State Legislature, sponsor of HB 314, explained that the legislation extends the authorization of the Alaska Regional Development Organizations (ARDOR) program for five years to FY2021. There is zero funding for the program this year. The bill leaves the reporting requirements in place, subject to state funding. She noted that 89 percent of ARDOR funding last year was not state funding. She reported on the Copper Valley Development Association accomplishment of assisting seven business startups. She shared that the Southeast Alaska Municipal Conference (SWAMC) has an exciting focus of manufacturing trusses for cold weather housing. Anchorage Economic Development's focus on their airport has been successful. In the Kenai area the focus has been on business retention and incubation. She concluded that the reauthorization of the ARDOR program allows them to retain their designation to carry out their activities. 3:02:01 PM SENATOR STEVENS offered his understanding that without the bill ARDORs cannot apply for funding. REPRESENTATIVE HUGHES replied they could apply for certain funds, but it might be a problem for federal funding and foreign funding. SENATOR MEYER asked if there was no more state match for funding for ARDORs. REPRESENTATIVE HUGHES said that is correct. It is her understanding that they could leverage other dollars, but not state matching dollars. BRITTENY CIONI-HAYWORD, Director, Division of Economic Development, Department of Commerce, Community and Economic Development (DCCED), said she is eager for HB 314 to move forward. She explained that DCCED often works on statewide initiatives within the ARDOR program, such as by providing education, grants, and foreign work opportunities. 3:04:40 PM CHAIR COSTELLO opened public testimony. 3:04:51 PM ROBERT VENABLES, Energy and Transportation Coordinator, Southeast Conference, said the state's ARDOR program has demonstrated its value over the past 28 years. This program facilitates the public and private investment that will stimulate the economy and create jobs. It is a powerful mechanism to move economic development forward. Southeast Conference will miss the state money but will move forward and look for other sources of revenue. The October EDA report shows that the investment of about $70,000 a year for each ARDOR has collectively been leveraged to over $100 million in construction projects and $286 million in private investment. 3:06:26 PM CHAIR COSTELLO asked if the lack of reporting requirements will yield a loss in identity for ARDORs. MR. VENABLES said there is a high level of transparency when reporting to conference members that will allow questions to be answered. SENATOR MEYER asked what the source of funds will be. MR. VENABLES listed the U.S. Department of Energy specifically and added that they are looking toward the private sector. SENATOR MEYER observed that there are other opportunities, such as crowd funding, and it looks like the program will thrive. MR. VENABLES said they will survive, but it will be more difficult to thrive. 3:09:31 PM SENATOR STEVENS asked Ms. Hayward if she'll still be aware of ARDOR accomplishments. MS. HAYWARD said she believes the division will be able to track what the different ARDORs are doing. They will maintain the working relationship until the appropriations begin again. There will still be need for a minimal vetting process. SENATOR STEVENS agreed there should still be basic reporting of ARDORs. MS. HAYWARD said the division would figure out how to provide a report without burdening state staff. SENATOR STEVENS suggested asking for the reports that are given to the various boards. MS. HAYWARD said the division could find resources to produce some sort of report. 3:13:33 PM CHAIR COSTELLO suggested working together to communicate what the ARDORs are doing without being onerous on the ARDORs. SENATOR MEYER asked if there would be a state bank for marijuana businesses. MS. HAYWARD said she didn't have that knowledge. 3:15:42 PM DOUG GRIFFIN, Southwest Alaska Municipal Conference (SWAMC), testified in support of HB 314. He related that SWAMC has been in existence since 1988 and includes about 25 percent of the tribes in Alaska in the region. Fishing is the newest endeavor and they hope to focus initially on seafood processing. They have the potential to access $2.5 million over five years. 3:19:37 PM CHAIR COSTELLO closed public testimony and held HB 314 in committee.