HCRA-260514-0800

Morning. I call this community— this meeting of the House Community and Regional Affairs Committee to order. Today is Thursday, May 14th, 2026, and the time is 8:11 AM. Members present are Representative Kai Hollen, Representative Mike Prox, Representative Garrett Nelson, Representative Steve St. Clair, Co-Chair Donna Mears, and myself, Co-Chair Rebecca Himschoot. We have a quorum to conduct business.

I would like to remind folks to silence their cell phones. And before we get started, I would also like to thank Sophia Tenney from House Records, who is here documenting today's meeting, and Susan Quigley from the Juneau LIO assisting us with the meeting recording. We have one item on our agenda today. It's Senate Bill 200, Farm and Agricultural Land. Assessments.

It's the second hearing of the bill. I'd like to invite Laura Asche from Senator Bjorkman's office to come forward, put your name on the record, and provide a brief recap of the bill. And I'm— this is a test on brief.

Thank you, Madam Chair. Ah, as I say, thank you, thank you, Madam Chair. My name is Laura Asche. I am staff to Senator Jesse Bjorkman of Senate District D. And briefly Farming is an industry with very slim profit margins, and in recognition of the impact that rapidly rising property values and the resulting property taxes can have on farmers, in 1967, the legislature put in statute a municipal property tax deferral that would not eliminate, but would lower for farmers municipal property taxes on the areas where they are actively farming. Over the years, this statute has been adjusted to keep up with the times.

And 2 years ago, this body and the other body passed legislation that modernized the income test for eligibility for the program based on recommendations from the Farm Bureau. And also at that time, the legislature narrowed the scope of the deferral to only food production producing agriculture. Since then, two things have happened. One, we have recognized that we inadvertently shut out farms that operate as S corporations by the way that the eligibility was worded. And also, it has become very apparent to Senator Bjorkman that agriculture, the agriculture industry, is very integrated and that all parts of it must be equally supported in order for all parts of it to succeed.

So what this bill does is it adds in S corporations that operate as farms and also adds back in non-food elements of agriculture.

Okay. Thank you for that recap. I want to let the committee know we have Amy Seitz, Policy Director from Alaska Farm Bureau, online for questions, and Sandra Muller, Director of the Division of Community and Regional Affairs. If there are questions so far on just this part, we could take those and then we'll take an at ease until our final member can get here. Are there any questions?

Representative Holland. Great. Thank you. Through the co-chair, at our last meeting I had asked a question about the soil conservation plans and if there was any data on the number of those plans and the extent of that, because I was kind of curious about to what extent this was a way to easily add a bunch of land into this property tax exemption. I'm curious if the folks online were able to find anything for us that might give us a little more understanding about the use of these plans and the extent of them and how they potentially are affected because I think this is a part that's being added into this legislation and statute to be able to do this.

I'm curious what this is going to— what impact this will have on the amount of property that now is going to be under the farming tax exemption. Okay, let's take that question to Amy Seitz with the Alaska Farm Bureau. If you could unmute yourself and put your name on the record and let us know if you need the question again.

Yes, thank you, Madam Chair. For the record, this is Amy Seitz, Policy Director for the Alaska Farm Bureau, and I, I, uh, sorry I didn't get it up earlier. I sent an email with just some, uh, some information around that. So currently, the main place that there are any textural farm conservation plan or soil conservation plan is through the Division of Agriculture tied to Ag Covenant properties. There's 600-plus farms statewide who have a current conservation plan on file.

It is required in statute for Ag Covenant properties to have that. Several years ago, Soil and Water Conservation Districts strongly encouraged farms to get a conservation plan established. Over the past several years, due to lack of funding and capacity, they haven't been They haven't been pushing that. They haven't been keeping up on it, primarily because it hasn't been required for any programs. With it being required in this bill, I would anticipate seeing some farms kind of pick that back up again, working with Division of Agriculture.

When I spoke with Eric Johnson, the lands person at the Division of Agriculture yesterday, he said he's had a handful of simple properties going to get a conservation plan. But, but again, with this bill, since, since there would be a requirement tied to this, I would anticipate more being interested. Unfortunately, I don't know what number that is, um, just because it would be, you know, a farm that is in a property tax municipality or borough and they would have a section of their property that has a tree stand or something. So, I don't have an exact number of how many more we would get. And if you want, I didn't get the information yet, the breakdown of Ag Supplement land per municipality, but I could follow up with that, kind of a breakout of those 600+ current properties with the conservation plan.

Okay, thank you. And I think Ms. Asche wanted to add something. Very briefly, Madam Chair, through the chair, Representative Holland, I sense in your question perhaps a concern that this would greatly impact the amount of land that falls under the property tax deferral. And I don't see that as being the case on farms. What we're talking about are strips of land, say around a field where there's trees to help prevent soil from blowing off the field, or strips of land.

If you have a farm that borders on a waterway, you'll have a strip of land to keep that waterway from being impacted. And my understanding is that these have been given the property tax deferral until— we heard that last year one particular borough had suddenly stopped. So this is just something that we thought would have already been covered by the statute. We are clarifying is absolutely covered by the statute. But this, I think we hear conservation, we think about like Powder Marsh or Kramer Field or places that are big swaths of land.

This is not what we're talking about. I appreciate the discussion and getting that on the record. Something to follow down the road, but I'm satisfied for now. Okay. Are there additional questions?

Representative Prox?

Thank you. Through the Chair, just to clarify that in my mind, this is— the whole thing is about land that has been predesignated agricultural use by DNR or somebody. Ms. Mesche. Through the chair, Representative Prox, you sit in another committee where Senator Bjorkman has another bill that deals with a wholly separate issue, which is the leasing and purchase of state land for agriculture. This is talking about private land within organized boroughs, which may or may not have Ben State Land.

So some of it may have agricultural covenants on it, but not all of it.

Well, I, I guess it's just another thing to get my head around, because it would seem to me that that could turn into quite a burden to go through all the regulations and whatnot to develop this Conservation Plan. And are we adding something that potentially makes the whole thing— not the whole thing, but just make it more difficult and not as advantageous as we would like? I think Co-Chair Mears has a thought about that. Co-Chair Mears. Yes, through the chair representative proxy has already been exist.

So it's not adding an extra burden, it's just saying if you have this, then this land is included. Oh, okay. Okay, um, we did receive one amendment by the deadline, so I am going to look to Representative Hall to move her amendment. Thank you, Madam Co-Chair. I move Amendment 1, Work Order 34-LS1096/h.

2. And I will object for the purpose of an explanation. Representative Hall, would you like to explain your amendment? Yes, thank you, Madam Co-Chair. Amendment H.2 removes any restrictions on hay uses.

All the land and buildings used for hay production on a farm would be eligible for the farm tax deferral. It also adds back in peonies and other Alaska-grown flowers. Land and structures used to produce flowers would be eligible for the farm tax deferral. Okay, discussion on the amendment? Representative Prox and then Co-Chair Mears.

Well, on the amendment, I'm thinking it's probably a good idea, but that would include— I would guess that would include commercial greenhouses at this point. Representative Hall. Pardon me, could you please clarify the question, Representative? There's— in the interior, there's quite a few greenhouses that do starters for vegetables and edible plants, and then they also do flowers and decorative plants, and You know, I guess I have no objection to that, but is that understood to be included? And Representative Hall, if I could just interrupt for a second, I should have started with the bill sponsor on this amendment, and then we'll come back and field that question.

Um, oh, are you asking for a position on the amendment? Senator Bjorkman supports passage of the amendment, and I can also address the question if you'd like through the chair to Representative Prox If the greenhouse is starting the plants and growing them to sell, then yes, they would be covered. If they're simply importing starts and caring for them until they're sold, then no.

Okay, I think we'll go to Co-Chair Mears, unless you wanted to add to that. I have no, no further comments. Okay, Co-Chair Mears. Thank you, through the chair. So this is also taken proportionately, so it's not all or nothing.

So, so that's taken into account by the assessors. And I'm really— I'm highly supportive of the amendment. And, you know, where we're at, taking it back in the CS was strict food security only, and it was very clear from the discussion that at least, you know, hay and straw needed to be included because You know, is this— is it going to a meat rabbit or a pet rabbit? You know, I— not discriminating between species, but between uses. So that was clear, that is covered in here.

And I think the argument was made to go another step further on the floor culture as being an integral part of the industry. So I think that clarity was made. I think the clarity of, you know, that next step of, you know, not all greenhouses do the same thing, like as we were just discussing. So I'm very happy with the amendment. I'm very happy with where we're at with the bill, and I'm looking forward to passing the amendment and moving this out.

Okay, Representative Nelson. Yes, thank you, Madam Co-Chair. I also am in support of the amendment. You know, when we were talking about agriculture. However, people define it different in their minds, but just because something is not purely for human consumption doesn't mean it's not agriculture.

So that's one of the things that, uh, I think would be good to add back in, um, as far as like horses. However, I think this is a good, uh, stepping stone Um, and then without also getting prescriptive in adding what are included. So there's no exclusion list, I think, which is important, um, in this amendment. I think it gets to the, the intent of the bill, the intent of the sponsor, and, uh, addresses some of the concerns that have been brought up. So yeah, I, I am in support of Amendment 1.

Thank you. Thank you, Representative Nelson. Representative Holland. Great, thank you. Um, I think to the maker of the amendment, but this is mostly a comment, perhaps a little bit of a question.

I do support the amendment. I'm particularly pleased to see this clarification of the $2,500. It originally, in the original legislation, was tied to products being sold. The bill had shifted it to income, which as we discussed in the last hearing, to me opened up a lot of vagueness around how you made income from the property and the land. And I think moved us away from providing the essence of this legislation, which is helping ensure that agricultural businesses and products made from that land are getting the benefit of this.

So your amendment returning the language tying this to products being old is welcomed, and I appreciate what you're doing there. And I'm just curious if there's anything else you want to add on that change, but I appreciate what you've done and I support it. Okay, any further discussion on this amendment? Okay, did you want to add anything else, Representative Hall? No, thank you, Madam Chair.

Okay, then in that case, I will remove my objection. Are there any other objections?

Seeing none, we have adopted Amendment 1, Work Order 34-LS1.

1096/8.2. And as we move on here, Ms. Asche, would you like to make any closing comments on this bill before we take a motion? On behalf of Senator Bjorkman, I just thank the committee for your diligent work on this topic and your support of the agriculture industry. Okay, any other comments from the committee? I look for a motion.

Oh, Representative Prox, just a comment. We should apply that to gas pipelines and other marginal— we— just a comment— we should apply that to gas pipelines and other marginal industries.

Would you like to offer an amendment? Representative Nelson. Thank you, Madam Co-Chair. I just want to speak briefly on this, is that as we discussed in previous hearings, Alaska is in a unique position where when we talk about agriculture and food production, we are not like— we are decades behind where other states are. And so when there are maybe the first, even at this point still, or the second generation that came up and even homesteaded up here and cleared land and cut down trees and ripped out stumps— I hate anecdotal and emotional appeals.

But this is— I mean, this, this just actually applies. And those individuals are not concerned with what some bureaucrat says their land is worth because it's cleared and could have houses put on it, so it increases the value over raising potatoes or carrots. And so I think that this is a good step in, in— I don't know if it's incentivizing or rewarding or just recognizing the hard work that has already been put into cleared land in Alaska that is being used for agriculture, even though the industry is small here, and doing everything we can to help protect that in the future, because clearing trees and making farm ground out of virgin forest is difficult. So I, I, I'm very happy about this. And hope to see more of it in the future.

Farming is what I mean. Okay, thank you, Rep. Sam Nelson. I'm just gonna take a little issue with us being behind in that we've had a dairy. We—. Like, there are lots of things that we have done in agriculture, and it's more a question of how does Alaska do it possibly differently.

So follow-up? I—. We need to get someone out of this. Talking about Pure Acres. Done.

I'm done. Great. I'm going to look to Co-Chair Mears for a motion. I move SB 200 version 34-LS-1096/h as amended with individual recommendations and attached fiscal note. Thank you.

Are there any objections? Seeing no objections, SB 200 version 34-LS-1096/h moves from committee as amended with individual recommendations and attached fiscal note. That concludes our business for today. We will be scheduling a hearing in the next day or two to consider a forthcoming resolution. We will let members know when that meeting will be.

Something to look forward to. Can I make a final comment? Um, Representative Mears, I just make—. Like to make an invitation. Uh, Representative Nelson, Senator Bjorkman, Senator Rauscher, and I are all co-chairs for the Food and Farm Caucus, and we would invite you all to join us in the next Legislature, or whoever may be in those roles to explore more at supporting our agricultural industry and food security and all things yummy and good.

And I think that caucus has done great things and really advanced this conversation. Like, there was a depth, a well of knowledge that we could draw on for this bill, and I just kind of deferred to people who are actively involved in that. And you guys had the discussions and came to some conclusions. Representative Prox. As to the proposed next meeting, what is the resolution about?

Well, I don't know. I at least, and we are all going to be busier than one-armed wallpaper hangers this coming week. Co-chair Mears. As soon as we have the draft back from legal, we will distribute it to folks on the floor and/or offices as appropriate. I haven't seen the draft yet either.

And I think, Representative Prox, I'll just remind you, if you have a bill moving, you're grateful when a committee is able to pull themselves together for that meeting on 24-hour notice. So we'll be doing the same for our colleagues or ourselves.

Okay. Seeing no further business before the committee, this meeting is adjourned. It is 8:30 31 AM.