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HOUSE BILL NO. 369
IN THE LEGISLATURE OF THE STATE OF ALASKA
THIRTY-THIRD LEGISLATURE - SECOND SESSION
BY REPRESENTATIVE ORTIZ
Introduced: 2/20/24
Referred: Community and Regional Affairs, Labor and Commerce
A BILL
FOR AN ACT ENTITLED
1 "An Act relating to municipal port authorities and municipal development authorities;
2 relating to leases of state land to a municipal authority; and relating to the definition of
3 'municipal bond.'"
4 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:
5 * Section 1. AS 29.35.600 is amended to read:
6 Sec. 29.35.600. Purpose of authorities. The purpose of a port authority is to
7 provide for the development of a port or ports for transportation related commerce
8 within the territory of the authority. The purpose of a development authority is to
9 promote, develop, and advance the general prosperity and economic welfare of
10 the people of a municipality, to relieve problems of unemployment, and to create
11 additional employment.
12 * Sec. 2. AS 29.35.605(a) is amended to read:
13 (a) A port authority or development authority may be created by one of the
14 following means:
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1 (1) the governing body of a municipality may create by ordinance a
2 port authority or development authority as a public corporation of the municipality;
3 (2) the governing bodies of two or more municipalities may create by
4 parallel ordinances adopted by each of the governing bodies a port authority or
5 development authority as a public corporation of the municipalities.
6 * Sec. 3. AS 29.35.605(c) is amended to read:
7 (c) An [A PORT] authority created under this section is a body corporate and
8 politic and an instrumentality of the municipality or municipalities creating it but
9 having a separate and independent legal existence.
10 * Sec. 4. AS 29.35.605(d) is amended to read:
11 (d) Creation of a port authority under AS 29.35.600 - 29.35.730 is an exercise
12 of a municipality's transportation system powers. Creation of a development
13 authority under AS 29.35.600 - 29.35.730 is an exercise of a municipality's power
14 to expend money for a community purpose, facility, or service for the good of the
15 municipality under AS 29.35.010(9).
16 * Sec. 5. AS 29.35.605(e) is amended to read:
17 (e) The enabling ordinance by which an [A PORT] authority is established
18 must specify the powers, boundaries, and limitations of the [PORT] authority,
19 including the types of projects that the authority may undertake.
20 * Sec. 6. AS 29.35.605(f) is amended to read:
21 (f) An ordinance creating an [A PORT] authority shall require approval by the
22 voters of the municipality or municipalities participating in the authority in order for
23 the authority to be established.
24 * Sec. 7. AS 29.35.605(g) is amended to read:
25 (g) Nothing in AS 29.35.600 - 29.35.725 prevents a municipality or
26 municipalities from creating or participating in a public corporation, including an [A
27 PORT] authority, in any form or manner not prohibited by law. However, the
28 provisions of AS 29.35.600 - 29.35.725 only apply to and may only be utilized by an
29 [A PORT] authority created under this section.
30 * Sec. 8. AS 29.35.610(a) is amended to read:
31 (a) The enabling ordinance by which an [A PORT] authority is created must
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1 provide for the manner by which an [A PORT] authority may be dissolved.
2 * Sec. 9. AS 29.35.620 is amended to read:
3 Sec. 29.35.620. Powers. If provided in the enabling ordinance, an authority
4 may
5 (1) sue and be sued;
6 (2) have a seal and alter it at pleasure;
7 (3) acquire an interest in a project as necessary or appropriate to
8 provide financing for the project, whether by purchase, gift, or lease;
9 (4) lease to others a project acquired by it and on [UPON] the terms
10 and conditions the authority may consider advisable, including, without limitation,
11 provisions for purchase or renewal;
12 (5) sell, by installment sale or otherwise, exchange, donate, convey, or
13 encumber in any manner by mortgage or by creation of another security interest, real
14 or personal property owned by it, or in which it has an interest, including a project,
15 when, in the judgment of the authority, the action is in furtherance of the authority's
16 purposes;
17 (6) accept gifts, grants, or loans, under the terms and conditions
18 imposed under the gift, grant, or loan, and enter into contracts, conveyances or other
19 transactions with a federal agency or an agency or instrumentality of the state, a
20 municipality, private organization, or other person;
21 (7) deposit or invest its funds, subject to agreements with bondholders;
22 (8) purchase or insure loans to finance the costs of projects;
23 (9) provide for security within the boundaries of the authority;
24 (10) enter into loan agreements with respect to one or more projects on
25 [UPON] the terms and conditions the authority considers advisable;
26 (11) acquire, manage, and operate projects as the authority considers
27 necessary or appropriate to serve the authority's purposes;
28 (12) assist private lenders to make loans to finance the costs of projects
29 through loan commitments, short-term financing, or otherwise;
30 (13) charge fees or other forms of remuneration for the use or
31 possession of projects in accordance with the agreements described in this section,
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1 other agreements relating to the projects, covenants, or representations made in bond
2 documents relating to the projects, or regulations of the authority relating to the
3 projects;
4 (14) exercise the powers of eminent domain and declaration of taking
5 within its physical boundaries under AS 29.35.030 to acquire land or materials for
6 authority purposes;
7 (15) regulate land use within the boundaries of the authority;
8 (16) defend and indemnify a current or former member of the board,
9 employee, or agent of the authority against all costs, expenses, judgments, and
10 liabilities, including attorney fees, incurred by or imposed on [UPON] that person in
11 connection with civil or criminal action in which the person is involved as a result of
12 the person's affiliation with the authority if the person acted in good faith on behalf of
13 the authority and within the scope of the person's official duties and powers;
14 (17) purchase insurance to protect and hold harmless its employees,
15 agents, and board members from an action, claim, or proceeding arising out of the
16 performance, purported performance, or failure to perform in good faith, of duties for,
17 or employment with the authority and to hold them harmless from expenses connected
18 with the defense, settlement, or monetary judgments from that action, claim, or
19 proceeding; the purchase of insurance is subject to the discretion of the board;
20 insurance purchased under this paragraph may not be considered compensation to the
21 insured person; [AND]
22 (18) protect its assets, services, and employees by purchasing
23 insurance or providing for certain self-insurance retentions; an authority may also
24 maintain casualty, property, business interruption, marine, boiler and machinery,
25 pollution liability, and other insurance in amounts reasonably calculated to cover
26 potential claims against the authority or a municipality for bodily injury, death or
27 disability, and property damage that may arise from or be related to authority
28 operations and activities; and
29 (19) finance, acquire, manage, and operate development projects
30 that the authority intends to own and operate or provide financing for
31 development projects the authority does not intend to own and operate; in this
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1 paragraph,
2 (A) "development project" means a project listed in
3 AS 29.35.725(6)(B) - (J);
4 (B) "operate" includes operation directly by the authority,
5 by an agent of the authority, or by a person as determined under an
6 agreement between the authority and other owners of the development
7 project;
8 (C) "own" includes ownership by the authority of all or a
9 percentage of a development project or all or a percentage of the shares of
10 a corporation or membership in a limited liability company for which the
11 development project is the sole asset of the corporation or limited liability
12 company.
13 * Sec. 10. AS 29.35.725(1) is amended to read:
14 (1) "authority" means a port authority or a development authority
15 [ESTABLISHED UNDER AS 29.35.605];
16 * Sec. 11. AS 29.35.725(6) is amended to read:
17 (6) "project" means
18 (A) a port, dock, and administrative facilities, including
19 property necessary in connection with the operation of a port;
20 (B) a plant or facility used or intended for use in connection
21 with making, processing, preparing, transporting, or producing in any
22 manner, goods, products, or substances of any kind or nature or in
23 connection with developing or using a natural resource, or extracting,
24 smelting, transporting, converting, assembling, or producing in any
25 manner, minerals, raw materials, chemicals, compounds, alloys, fibers,
26 commodities and materials, products, or substances of any kind or nature;
27 (C) a plant or facility used or intended for use in connection
28 with a business enterprise;
29 (D) commercial activity by a single proprietorship,
30 cooperative, corporation, firm, partnership, or other association of
31 persons organized in any manner, for any credit worthy business purpose;
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1 (E) a plant or facility demonstrating technological advances
2 of new methods and procedures and prototype commercial applications
3 for the exploration, development, production, transportation, conversion,
4 and use of energy resources;
5 (F) infrastructure for a new tourism destination facility or
6 for the expansion of a tourism destination facility; in this subparagraph,
7 "tourism destination facility" does not include a hotel or other overnight
8 lodging facility;
9 (G) a plant or facility, other than a plant or facility
10 described in (E) of this paragraph, for the generation, transmission,
11 development, transportation, conversion, or use of energy resources;
12 (H) a plant or facility that enhances, provides for, or
13 promotes economic development with respect to transportation,
14 communications, community public purposes, technical innovations,
15 prototype commercial applications of intellectual property, or research;
16 (I) a plant or facility used or intended for use as a federal
17 facility, including a United States military, national guard, or coast guard
18 facility; or
19 (J) infrastructure for an area that is designated as a
20 military facility zone under AS 26.30;
21 * Sec. 12. AS 29.35.725(7) is amended to read:
22 (7) "project cost" or "cost of a project" means all or any part of the
23 aggregate costs determined by an authority to be necessary to finance the construction,
24 expansion, or acquisition of a project, including without limitation [TO] the cost of
25 acquiring real or tangible personal property, and, in connection with real property,
26 the cost of constructing buildings and improvements, the cost of constructing means
27 of access to and from the project, and the cost of constructing extensions of utility
28 systems to the site of the project; the cost of a project includes, without limitation,
29 the cost of financing the project, [INCLUDING, WITHOUT LIMITATION,] interest
30 charges before, during, or after construction, expansion, or acquisition of the project,
31 costs related to the determination of the feasibility, planning, design, or engineering of
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1 the project and, to the extent determined necessary by the authority, administrative
2 expenses, the cost of machinery or equipment to be used in the operation of the
3 project and expenses of installation, replacement, or rehabilitation [OF A PORT],
4 and all other costs, charges, fees, and expenses which [THAT] may be determined by
5 the authority to be necessary to finance the construction, expansion, or acquisition;
6 * Sec. 13. AS 29.35.725 is amended by adding new paragraphs to read:
7 (10) "development authority" means an authority established under
8 AS 29.35.605 with the power to undertake a project listed in (6)(B) - (J) of this
9 section;
10 (11) "plant" or "facility" means real property, whether above or below
11 mean high water, or an interest in it, and the buildings, improvements, and structures
12 constructed or to be constructed on or in it, and may include roads, fixtures,
13 machinery, and equipment on it or in it, and tangible personal property, regardless of
14 whether the tangible personal property is attached to or connected with real property,
15 if the owner has agreed not to remove the tangible personal property permanently from
16 the state for the period the authority sets; "plant" or "facility" does not include work in
17 process or stock in trade;
18 (12) "port authority" means an authority established under
19 AS 29.35.605 with the power to undertake a project under (6)(A) of this section.
20 * Sec. 14. AS 29.35.730 is amended to read:
21 Sec. 29.35.730. Short title. AS 29.35.600 - 29.35.730 may be referred to as the
22 Municipal Port and Development Authority Act.
23 * Sec. 15. AS 38.05.810(i) is amended to read:
24 (i) Subject to AS 38.05.820, the commissioner may lease undeveloped state
25 land, including tideland, to an [A PORT] authority established under AS 29.35.600 -
26 29.35.730, if the state land is within the physical boundaries of the authority and is
27 needed by the authority for purposes provided in AS 29.35.600 - 29.35.730. The
28 commissioner may lease developed state land, including tideland, to an [A PORT]
29 authority established under AS 29.35.600 - 29.35.730 only if, (1) the developed state
30 land is within the physical boundaries of the authority; (2) the developed state land is
31