House Job Growth and Energy Affordability Policy and Finance Committee  3/14/17

House Job Growth and Energy Affordability Policy and Finance Committee 3/14/17


>>[GAVEL]>>CHAIR GAROFALO: GOOD MORNING AND WELCOME TO THE MEETING OF THE JOB GROWTH AND ENERGY AFFORDABILITY POLICY AND FINANCE COMMITTEE FOR TUESDAY; MARCH 14; 2017. OUR FIRST ORDER OF BUSINESS IS APPROVAL OF THE MINUTES REPRESENTATIVE ANDERSON MOVES THE MINUTES OF MARCH 17 2017. ARE THERE ANY CHANGES; CORRECTIONS OR ADDITIONS?>>>ALL THOSE IN FAVOR PLEASE SIGNIFY BY SAYING AYE.>>[CHORUS OF AYES]>>>OPPOSED; NAY. THE MINUTES ARE ADOPTED.>>THE FIRST BILL IS HOUSE FILE REPRESENTATIVE MOVES THE AMENDMENT TO GET THE BILL IN THE FORM THAT THE AUTHOR WOULD LIKE.>>>ALL THOSE IN FAVOR PLEASE SIGNIFY BY SAYING AYE.>>[CHORUS OF AYES]>>>OPPOSED.>>CHAIR: THE AMENDMENT IS ADOPTED. REPRESENTATIVE FABIAN; DO YOU HAVE ANY MORE AMENDMENTS?>>REPRESENTATIVE FABIAN: NO SIR.>>CHAIR: REPRESENTATIVE FABIAN; TO YOUR BILL.>>REPRESENTATIVE FABIAN: THEY ARE PLANNING AN EXPANSION OF 1 MILLION NEW SQUARE FEET OF SPACE THERE FOR BUSINESS THAT THEY DO. THEY ARE PROJECTING TO HIRE 1000 PEOPLE IN THE NEXT 10 YEARS THEY EMPLOY ABOUT 3200 PEOPLE IN THIEF RIVER FALLS RIGHT NOW AND THE IMPACT THIS HAS ONE MINNESOTA IS VERY VERY SIGNIFICANT AND IT IS MY CONVICTION CHAIR TO SEE WHAT I CAN DO TO SEE THAT THIS BILL GOES INTO EFFECT. WE WOULD LIKE TO ACCESS THE BDPI PROGRAM AND ALSO THE INVESTMENT FUND AND WITH THAT I WILL TURN IT OVER TOMY TESTIFIER.>>CHAIR: PLEASE IDENTIFY YOURSELF FOR THE COMMITTEE AND GIVE YOUR TESTIMONY.>>TESTIFIER:WE WOULD ENTER INTO A BUSINESS AGREEMENT WITH THE BUSINESS AND AT ANY TIMEWE MAY CALL BACK THE AWARD IF THE PROJECT IS NOT MEET ITS PERFORMANCE GOALS. THIS PROJECT HAS A BASE OF $11 MILLION PER YEAR IN FISCAL 2018 AND FISCAL 2019.>>>SECTION 2 OF THE BILL IS FOR BUSINESS DEVELOPMENT AND PUBLIC INFRASTRUCTURE PROGRAMS. THIS IS A PROGRAM THAT PROVIDES FUNDING FOR LOCAL UNITS OF GOVERNMENT FOR LOCAL INFRASTRUCTURE COST FOR BUSINESS EXPANSION. THIS WILL PROVIDE UP TO $6 MILLION IN SUPPORT FOR THE BUSINESS EXPANSION AND ALSO; IT EXEMPTS THE MATCHING PROVISION IN LAW THAT’S REQUIRED. THOSE FUNDS MAY BE USED FOR WATER; SEWER; ROADS AND OTHER PUBLICLY RUN INFRASTRUCTURES TO SUPPORT THE PROGRAM.>>>THE LEGISLATOR CREATED THIS GENERAL FUND PROGRAM IN 2016 AND THERE ARE $2 MILLION IN PLACE FOR FISCAL YEAR 2018 AND 2019.>>CHAIR GAROFALO: THANK YOU. REPRESENTATIVE FABIAN; DO YOU HAVE ANY MORE TESTIFIERS?>>>WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER: AND SO IN THIS EXPANSION IF WE LISTEN TO THE POND AND THEY TELL US IT’S BEEN A NICE RIDE BUT IT WAS NICE KNOWING YOU BUT IN OUR COMMUNITY IT’S IN OUR BEST INTEREST IN THE STATE TO CONTINUE TO GROW DESPITE OUR PREMIUM WAGES AND BENEFITS WE PROVIDE IT’S THE BEST. WE TAKE CARE OF THEM AND THEY TAKE CARE OF CUSTOMERS AND CUSTOMERS TAKE CARE OF DIGIKEY YOU CAN SEE OUR REVENUE CHART AND WE ARE THE FOURTH LARGEST IN THE UNITED STATESBUT AS FAR AS CUSTOMER SERVICE AND SUPPLIES ETC. THERE’S NO O NE THAT COMES CLOSE TO US. THERE’S APPROXIMATELY 30% OF THE WORKFORCE OF THE COUNTY THAT IS EMPLOYED AT DIGIT KEY AN D WE ARE EXCITED ABOUT THE FUTURE AND WERE PREPARED TO MAKE AN INVESTMENT OF $110 IN THE BUSINESS INFRASTRUCTURE AND UP TO $300 MILLION IN TOTAL TO KEEP THIS HAPPENING AND BE ABLE TO EXPAND OUR FOOTPRINT IN THE FALLS.>>>WE HAVE BOTH A WAGE AND BENEFIT PACKAGE SECOND TO NONE. WE DID COMMENT ON THE STARTING WAGES FROM THE BENEFIT PERSPECTIVES WE HAVE A HEALTHCARE PLAN FOR ZERO CONTRIBUTION IS $18.50 A MONTH WITH A $10 CO-PAY AND NO DEDUCTIBLES OUR INTENTION IS WHEN WE HIRE THESE EMPLOYEES TO KEEP THEM THERE FOR LIFE. SOAGAIN IT’S A MODEL THAT WE PUT A LOT OF CONFIDENCE IN.>>REPRESENTATIVE>>CHAIR GAROFALO: WE HAVE THE MAYOR OF THIEF RIVER FALLS HERE WHO WOULD LIKE TO SPEAK TO US.>>TESTIFIER: IT BRINGS IN PEOPLE FROM SMALLER COMMUNITIES AROUND US AND THIS IS JUST HUGE AS FAR AS THE ECONOMIC SIDE OF IT UP IN THIEF RIVER FALLS IN THAT REGION AND WE PARTNERED UP WITH DIGIT KEY BUT WE CAN’T DO IT ALONE TO KEEP THEM IN THIEF RIVER FALLS. WE NEED YOUR HELP THEM WITHOUT THE CITY PARTNERING UP WITH THEM WERE AFRAID THAT THEY MAY NOT BE IN MINNESOTA AND THAT MAY BE THE ONLY DOWNSIDETO THIS WHOLE PROGRAM. THANKS AGAIN FOR ALLOWING ME TO COMMENT AND I’D BE HAPPY TO ANSWER ANY QUESTIONS.>>CHAIR GAROFALO: REPRESENTATIVE FABIAN DID YOU HAVE ANY MORE TESTIFIERS?>>REPRESENTATIVE FABIAN NO SIR; I DON’T.>>CHAIR GAROFALO: MEMBERS; THERE IS ONE SECTION THAT IS A TAX COMPONENT SO THE INTENTION OF THE CHAIR IS TO TAKE ACTION ON THIS BILL AND REFER THIS TO THE TAXES AND OBVIOUSLY THIS WOULD STAY IN THE PURVIEW OF THIS COMMITTEE.I WOULD JUST BRIEFLY HAVE STAFF HIGHLIGHT THE THREE SECTIONS OF THE BILLS SO THAT MEMBERS ARE AWARE OF IT.>>HOUSE STAFF: WE RAISED THE EXEMPTION FROM $3 MILLION PER YEAR TO $10 MILLION PER YEAR AND A MAXIMUM EXEMPTION FROM $10 MILLION TOTAL TO $30 MILLION TOTAL. IT ALSO ALLOWS THIS WAREHOUSE TO BE EXEMPT FROM SALES TAX FOR 10 YEARS RATHER THAN THE REGULAR SEVEN YEARS.>>>EXEMPTION TWO IS FOR THIEF RIVER FALLS USUALLY REQUIRED.>>>AND NUMBER THREE IS THE CONSTRUCTION OF THE NEW CENTER AND THAT IS IT.>>CHAIR GAROFALO: ANY QUESTIONS OR COMMENTS FROM MEMBERS OF THE COMMITTEE? REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: THANK YOU MR. CHAIR. IF THE TESTIFIER COULD COME BACK UP TO THE WITNESS TABLE. THANK YOU MR. CHAIR. MR. MCKENNAN; SECTION 1 IS THE TAX P SO I WILL REALLY TOUCH THAT. WELL; MAYBE I WILL ASK YOU BUT I’M GOING TO GO TO SECTION 2 WHICH IS THE BPTI AND THEN SECTION 3. COULD YOU TELL ME HOW MUCH MONEY IS IN EACH OF THOSE PARTICULAR FUNDS AT THE PRESENT TIME?>>CHAIR GAROFALO: MR. MCKENNA.>>TESTIFIER: THERE ARE ABOUT $300 MILLION IN BONDING FUNDS ASSOCIATED WITH THE PROGRAM AND WE ALSO HAVE A BONDING COMPONENT OF THIS PROGRAM THERE’S ALSO ABOUT 200;000 LEFT IN THE GENERAL FUND PORTION OF THIS PROGRAM.AS IT RELATES TO MINNESOTA INVESTMENT FUNDS; AT THE PRESENT TIME; THERE IS $14 MILLION IN THE MINNESOTA INVESTMENT FUND OF WHICH ABOUT 5 1/2 MILLION ARE ASSOCIATED WITH PROJECTS THAT WE ARE COMING TO FRUITION ON HERE VERY SHORTLY. AND; ABOUT $9 MILLION THAT IS IN– EIGHT AND HALF MILLION DOLLARS THAT IS IN THE PIPELINE FOR OTHER COMPANIES WHO WE ARE WORKING WITH.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: THERE IS $5.5 MILLION THAT HAVE BEEN ENCUMBERED. THERE IS $8.5 MILLION.I SEE THAT IN THERE BUT IF YOU TOTAL THIS IS $14 MILLION BUT WHERE DOES THE $4 MILLION COME FROM?>>CHAIR GAROFALO: MR. MCKENNA.>>TESTIFIER: IT COULD COME OUT OF THE BASE OR IF THE LEGISLATURE OF THIS COMMITTEE WISHES IT COULD COME OUT OF FUNDS THAT ARE UNENCUMBERED YET.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: DIDN’T YOU HAVE $11 MILLION IN THE BASE?>>CHAIR GAROFALO: MR. MCKENNA;>>TESTIFIER: WE DID HAVE THAT IN THE BASE.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: ON A SCALE OF 1 TO 10 WITH 10 BEING AT THE TOP I HAVE YOU DONE THIS LEVEL OR THIS DOLLAR FIGURE BEFORE ON A SCALE OF 1 TO 10 WITH 10 BEING THE HIGHEST; WHERE WOULD THIS BE?>>CHAIR GAROFALO: MR. MCKENNA.>>TESTIFIER: MR. CHAIR; REPRESENTATIVE MAHONEY; WE HAVE BUT FROM A SYSTEMS PERSPECTIVE THE $37 MILLION OR WHATEVER THE NUMBER AS UP TO HIM SORRY I FORGOT RIGHT NOW BUT WE’VE SEEN PROGRAMS LIKE THIS; UP ON THE RANGE WHERE THIS MAY BE A LITTLE BIT CLOSER–>>[LAUGHING]>>CHAIR GAROFALO: MR. MCKENNA; YOU HAVE THE FLOOR.>>TESTIFIER: YES; WE HAVE.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: YOU HAVE A $4 MILLION LOAN. CAN YOU GO OVER WHAT THE REQUIREMENTS ARE FOR THIS?>>CHAIR GAROFALO: MR. MCKENNA.>>TESTIFIER: WE WILL BE SPENDING THE MONEY OBVIOUSLY WITHIN TWO YEARS AS WE GET CLOSER TO A BUSINESS SUBSIDY AGREEMENT AS THEPROJECT GOES FORWARD THAT WOULD BE UP TO THE CITY OF THIEF RIVER FALLS. AND THE COMPANY. WE HAVE WENT OVER SOME LONG-TERM PLANS OF INVESTMENT AMOUNTS AND JOB CREATIONS AND WHAT WE WILL DO IS TAKE THE FIRST COUPLE YEARS TO TAKE A LOOK AT WHAT THE COMPANY IS GOING TO DO.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: ARE YOU GONNA ASK THE DEPARTMENT OF ECONOMIC DEVELOPMENT TO SHOW YOU THE JOB NUMBERS THEY COME UP WITH FOR THE AGREEMENT?>>TESTIFIER: AM I GOING TO ASK THEM–>>REPRESENTATIVE MAHONEY: YES ARE YOU GOING TO ASK THEM TO SHARE THAT INFORMATION WITH YOU FOR THE JOB NUMBERS.>>TESTIFIER: I’M NOT GOING TO ASK THEM FOR IT NOW.>>REPRESENTATIVE MAHONEY: NOT NOW.>>CHAIR GAROFALO: WE ARE GOING TO RECESSED AT 6:00 PM SO THAT EVERYONE CAN GRAB DINNER SO JUST KEEP IN MIND THE LARGE AND GENDER THAT WE HAVE TODAY. REPRESENTATIVE FABIAN>>CHAIR GAROFALO: REPRESENTATIVE DAPHNE.>>REPRESENTATIVE DAVNIE: I FAILED TO UNDERSTAND THE RATIONALE FOR THE SECTION OF 2.9 NOT REQUIRING A LOCAL MATCH. I UNDERSTAND THAT IN PART THIS WILL MAKE THE VALUE OF THEIR PROPERTY GO UP AND IF THE PROPERTY VALUE GOES UP THEN THE TAXES GO UP SO THE MAYOR HAD EMPHASIZED ECONOMIC GROWTH SO THE CITY WILL BE GETTING BENEFITS FROM THIS BUT THERE ASKING THE STATE TO PAY. I JUST DON’T UNDERSTAND HAVING SPENT FOUR YEARS IN THE TAX DIVISION WHY WERE NOT ASKING FOR A LOCAL MATCH.>>REPRESENTATIVE WITH REGARDS TO THE VALUE OF THE PROPERTY AND I’M NOT SURE HOW THAT IS ALL ASSESSED BUT IT’S PRETTY SAFE TO SAY THAT AFTER THIS BUILDING IS UP AND COMPLETED AND THEY SPENT THREE YEARS PUTTING IT TOGETHER THE VALUE IN THAT BUILDING IN AN OPEN MARKET WILL PROBABLY BE WORTH $15-$20 OR 100. BECAUSE THERE IS JUST NO OTHER PLACE– THERE’S NO OTHER BUSINESS THAT’S GOING TO COME AND LOCATE IN NORTHERN MINNESOTA ON A FOOTPRINT OF THE SIZE. WHY THE CITY IS NOT ASKING FOR AN EXEMPTION I WOULD GIVE THAT TO THE MAYOR I KNOW THEY HAVE OTHER CONSTRAINTS IN THE PROCESS AND IT’S A BIG; BIG; PROJECT THAT’S INVOLVED.>>TESTIFIER: WITHIN THE SPOT THEY WANT TO GROW THEY HAVE ELECTRIC LINES THEY ARE AND WE ARE JUST LOOKING TO ASSIST WITH THE INFRASTRUCTURE BECAUSE WE ARE GOING TO HAVE TO DO A LOT OF ABOVEGROUND COST FOR MOVING OUR ELECTRICAL DEPARTMENT IN SUCH AND WE HAVE PREDOMINATELY CREATED A 10 TON ROAD GOING IN AND OUT OF THE FACILITY TO PROVIDE TRANSPORTATION TO THE AIRPORT ON THE GROUND.>>CHAIR GAROFALO: IT SEEMS LIKE THE CITY WILL HAVE THESE COMMITMENTS OF A MATCH SO WHY THE MATCH REQUIREMENT?>>CHAIR GAROFALO: REPRESENTATIVE DAVNIE.>>REPRESENTATIVE DAVNIE: I WILL TRY TO STAY ON THE UPSIDE OF THIS AND CATCH YOU GUYS IN TAXES BECAUSE I DO BETTER THERE BUT WE USUALLY HAVE LOCAL; NO; I’M JUST TRYING TO UNDERSTAND OR THE FOR THE STATE INVESTMENTS TO HAVE SOME SKIN IN THE GAME AND YOU FOLKS ARE SAYING YEAH; YEAH; YEAH BUTCAL BENEFITSFROM THIS BUT I JUST CAN’T SEE.>>CHAIR GAROFALO: MR. MAYOR.>>TESTIFIER: WE HAVE NEVER HAD A PROJECT THIS BIG. WE HAVE SOME CAPS OF $50 MILLION RATHER THAN $300 BECAUSE THAT WILL GENERATE COST SAVINGS FOR THEM BUT THE BIGGEST PART IS THAT WE WILL BE WORKING ON THIS PROJECT FOR THE NEXT NINE YEARS.>>CHAIR GAROFALO: REPRESENTATIVE DAVNIE.>>REPRESENTATIVE DAP DAVNIE: THERE ARE OTHER COMPANIES WITHIN THE STATE THAT WOULD LIKE TO HAVE IN ON SOME OF THIS.>>CHAIR GAROFALO: REPRESENTATIVE WAGENIUS.>>REPRESENTATIVE WAGENIUS: THANK YOU MR. CHAIR I’M JUST WONDERING IF WE HAVE TO GET EMPLOYEES FROM SO FAR AWAY MIGHT BE AN ISSUE TO EMPLOYEES HERE. MAYO CLINIC PROVIDES BUSING FOR THEIR EMPLOYEES DO YOU HAVE ANYTHING LIKE THAT?>>REPRESENTATIVE FABIAN : ALTHOUGH OUR TRACK RECORD LOOKS A LITTLE OMNI S WE BRING PEOPLE FROM OUTSIDE THE STATE AND REFERRALS FROM OUR INSIDE EMPLOYEES ARE FANTASTIC WE HAVE A DIFFERENT TIMES REFERRAL BONUSES AND RELOCATION BONUSES ETC. AND PEOPLE COME AS FAR AS 90 MILES AWAY EITHER ON THEIR OWN OR THROUGH A BUS SERVICE.>>CHAIR GAROFALO: REPRESENTATIVE WAGENIUS.>>REPRESENTATIVE WAGENIUS: SO YOU WILL BE PROVIDING HOUSING AND BUS TRANSPORTATION.>>TESTIFIER: WE ARE LOOKING TO ADDRESS THAT. WE WOULD PREFERRED THAT THESE WOULD BE CLOSER IN PROXIMITY TO THESE BUILDINGS AND WE GET WEATHER ISSUES UP THERE THAT YOU DON’T GET DOWN HERE AND THESE ARE ESSENTIAL FOR OUR SERVICE LEVELS. WE’VE GOT A GREAT SCHOOL SYSTEM WE’VE GOT AN OPPORTUNITY TO GROW.>>CHAIR GAROFALO: REPRESENTATIVE METSA.>>REPRESENTATIVE METSA: I THINK REPRESENTATIVE LAYMAN WOULD AGREE WITH ME THAT THEY HAVE BEEN A LITTLE STRINGENT ON THAT BUT THAT’S A CONVERSATION I DON’T MEAN TO ENGAGE OR GET A RESPONSE FROM BUT IN ALL SERIOUSNESS ARE COMMITTEE HAS MADE SERIOUS ADVANCEMENT IN THAT.>>CHAIR GAROFALO: I SEE NO OTHER QUESTIONS OR COMMENTS REPRESENTATIVE FABIAN; YOU HAVE THE LAST WORD.>>REPRESENTATIVE FABIAN: THANK YOU MR. CHAIR. I KNOW THAT WE ARE PRESSED FOR TIME I WILL JUST SAY THAT I APPRECIATE YOUR SUPPORT ON THE BILL.>>CHAIR GAROFALO: THANK YOU REPRESENTATIVE FABIAN. AT THIS TIME WILL VOTE ON THE BILL ALL THOSE IN FAVOR SAY; AYE. OPPOSED; NAY>>[GAVEL]>>CHAIR GAROFALO: REPRESENTATIVE HALEY; TO YOUR BILL.>>REPRESENTATIVE HALEY: THANK YOU MR. CHAIR. SINCE THIS IS THE FIRST TIME I HAVE PRESENTED A BILL I HAD A LIGHT SNAC K THIS AFTERNOON AND I KNOW THAT YOU HAVE A FULL AGENDA TODAY SO I WILL JUST TRY TO GET RIGHT TO THE POINT WITH MY BILL. IT MY COMMUNITY IN REDWING 50% OF THE WORKFORCE COMMUTES EVERY DAY AND WHEN I SPEAK TO THE SCHOOL BOARD THEY CANNOT FIND TEACHERS BECAUSE WE DO NOT HAVE AFFORDABLE HOUSING. THIS IS AN ECONOMIC DEVELOPMENT BILL.EXTEND BEYOND THE COMMUNITY. IT STIMULATES JOBS; IT STIMULATES EMPLOYERS IT STIMULATES THE LOCAL JOB FORCE AND HOUSING.>>>LET ME TAKE YOU TO THE COMPONENTS OF THE BILL. FIRST OF ALL; THIS IS AN ENABLING LEGISLATION. THIS SIMPLY PROVIDES THE MECHANISM OF CITIES AND COUNTIES WITHIN THE LOCAL TRUST FUND. AND IT CREATES THIS MECHANISM IN PLACE SO THEY CAN DO THAT AND MEET THEIR HOUSING NEEDS.>>>SECONDLY THE BILL REQUEST THEY MATCH UP TO $100;000 ON A DOLLAR TO DOLLAR BASIS. BETWEEN 100;000 AND 500;000 THE MATCH WILL BE $.50 ON THE DOLLAR. LOCAL ENTITIES CAN CHOOSE TO PARTICIPATE OR NOT. THERE ARE MANY MEANS BY WHICH A LOCAL GOVERNMENT CAN ESTABLISH A HOUSE FUND. THEY CAN ESTABLISH A HR A OR A TRUST FUND OR A LOCAL ENTITY. THEY HAVE MANY OPTIONS WITH THIS BILL. LASTLY ; IT PROVIDES THE FULFILLMENT OF NEEDS IF THEY NEED SENIOR HOUSING OR WORKFORCE HOUSING OR PAYMENT ASSISTANCE FOR FIRST-TIME BUYERS OR TO ASSIST MILLENNIAL’S AND HOME OWNERSHIP OR TO PROVIDE RENTAL ASSISTANCE OR A REHAB HOUSING ALL OF THIS IS UP TO THE LOCAL MUNICIPALITIES TO DETERMINE WHAT THEIR PRIORITIES ARE. BUT WITH THAT BRIEF INTRODUCTION; I WILL STAND F OR ANY QUESTIONS. THANK YOU MR. CHAIR.>>CHAIR GAROFALO: THANK YOU. DO YOU HAVE ANY TESTIFIERS ON YOUR BEHALF?>>REPRESENTATIVE HALEY: ONLY IF IT’S A TECHNICAL QUESTION I CANNOT ANSWER IN RESPECT OF TIME.>>CHAIR GAROFALO: THANK YOU DO WE HAVE ANY QUESTIONS OR COMMENTS FROM THE COMMITTEE? REPRESENTATIVE THEISSEN.>>>ANY ADDITIONAL QUESTIONS OR COMMENTS FROM THE COMMITTEE? REPRESENTATIVE HALEY HAVE YOU SPOKE TO THE TAX OFFICE TO SEE IF HE WANTS TO SEE THIS BILL?>>REPRESENTATIVE HALEY: I DID NOT.>>CHAIR GAROFALO: YOU MAY WANT TO CHECK THIS WITH HIM.>>REPRESENTATIVE HALEY: THANK YOU FOR THE ADVICE MR. CHAIR.>>CHAIR GAROFALO: WITH THAT HOUSE FILE 1607 IS LAID OVER FOR POSSIBLE INCLUSION.>>REPRESENTATIVE: OFFERS EMPLOYERS TO PROVIDE AN OPTIONAL OFFSET WAGE ACCOUNT TO OFFSET WAGES DURING A FAMILY OR MEDICAL LEAVE. THIS WILL BE DEDUCTED FROM MINNESOTA INCOME TAX AND PROVIDE A TAX CREDITON THE FEDERAL INCOME TAX FOR A CONTRIBUTION AMOUNT. THIS IS ADJUSTED FOR INFLATION OVER TIME. EMPLOYERS MUST USE A MATCHING AMOUNT AND FOR 2018-2019 IS BEEN IDENTIFIED FOR SMALL BUSINESS. TOOL FOR FAMILIES AND IT PROVIDES THE ASSISTANCE THAT SMALL BUSINESSES NEED ON A VOLUNTEER BASIS. THANK YOU MR. CHAIR.>>CHAIR GAROFALO: ARE THERE ANY MEMBERS OF THE PUBLIC THAT WOULD LIKE TO POSE A QUESTION OR COMMENT ON THE BILL? SEEING NONE WILL CLOSE PUBLIC COMMENT. AT THIS TIME ARE THERE ANY COMMITTEE MEMBERS THAT HAVE ANY QUESTIONS OR COMMENTS ON THE BILL? SEEING NONE. WE WILL MOVE THE BILL. ALL THOSE IN FAVOR SAY; AYE. OPPOSED; NAY. [GAVEL]>>CHAIR GAROFALO: IS REPRESENTATIVE HOPPE HERE? WE WILL HEAR BOTH BROADBAND BILLS AT THE SAME TIME IF THAT IS OKAY. MEMBERS; WE ARE GOING TO SIMULTANEOUSLY HEAR HOUSE FILE 1618 AND HOUSE FILE 841. THEY ARE DIFFERENT BUT THEY ARE ON THE SAME SUBJECT MATTER.>>CHAIR GAROFALO: WE WILL HOLD OFF ON THE FORMAL MOTIONS UNTIL THE PRESENTATIONS ARE COMPLETE BUT AT THIS TIME REPRESENTATIVE BAKER AND REPRESENTATIVE SANDSTEDE BOTH BILLS WILL BE HELD OVER FOR POSSIBLE INCLUSION REPRESENTATIVE; TO YOUR BILL.>>REPRESENTATIVE SANDSTEDE: LARGE BUSINESSES SMALL BUSINESSES SCHOOLS COMMUNITY INSTITUTIONS AND OTHERS HAVE RECOGNIZED THAT HIGH-SPEED INTERNET ACCESS IS ESSENTIAL TO BE CONNECTED IN THE 21ST CENTURY. BROADBAND CAN NO LONGER BE CONSIDERED A LUXURY OR A CONVENIENCE. RATHER; IT’S AN ESSENTIAL PART OF OUR INFRASTRUCTURE WHEN THE BROADBAND GRANT PROGRAM WAS LAUNCHED IN 2014 IT AWARDED $20 MILLION IN GRANTS ATACROSS THE STATE. IN 2014; DEED RECEIVED THE 20 APPLICATIONS FOR 44.>>>ALTOGETHER THE BORDER TO BORDER BROADBAND PROGRAM DEED HAS REWARDED GRANTS TO MORE THAN 17 BROADBAND PROJECTS ACROSS THE STATE. HAVE A COUPLE OF DIFFERENT HANDOUTS IN YOUR POCKETS AND YOU SHOULD TAKE A LOOK AT THOSE. THIS HAS CONNECTED OVER 26;000 HOUSEHOLDS; 3000 BUSINESSES.>>>IN ITS LATEST ANNUAL REPORT IN DECEMBER 2016 THE TASK FORCE IS COMPRISED OF 15 MEMBERS FROM THE BROADBAND INDUSTRY AND VARIOUS NONPROFITS AND LOCAL UNITS OF GOVERNMENT. SO; MY BILL IS REQUESTING AN APPROPRIATION OF $100 MILLION IN LINE WITH THE BROADBAND TASK FORCE.>>CHAIR GAROFALO: AND I WOULD APPRECIATE YOUR SUPPORT. DO YOU HAVE ANY INVITED TESTIFIERS REPRESENTATIVE?>>REPRESENTATIVE SANDSTEDE: I HAVE SEVERAL TESTIFIERS BUT I WILL KEEP IT BRIEF.>>CHAIR GAROFALO: THANK YOU. PLEASE IDENTIFY YOURSELF FOR THE COMMITTEE YET AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER:THANK YOU MR. CHAIR AND REPRESENTATIVES. I BELIEVE THAT THE BROADBAND GRANT PROGRAM WILL GROW FOR THREE REASONS. FIRST WOULD BE THE CONNECTION BETWEEN PUBLIC AND PRIVATE OFFICES I COMMEND THE OFFICES IN BROADBAND TO WORK THROUGH THESE DETAILS OF THESE MODELS OTHERS ARE ABLE TO EASILY COPY THESE MODELS.>>>SECONDLY THIS PROVIDES LOCAL [INAUDIBLE]>>>THIRD BROADBAND INITIATIVES ARE INCREASINGLY ORGANIZED AS MULTI-COMMUNITY COUNTYWIDE AND MULTI-COMMUNITY EFFORTS. FOR EXAMPLE IN SOUTHWEST MINNESOTA THERE ARE SIX COUNTIES WORKING TOGETHER ON A BROADBAND ACCESSIBILITY STUDY TO PROVIDE BEEN THROUGHOUT THAT REGION. COMMUNITY LEADERS ARE MOVING FORWARD TO DETERMINE THEIR BEST OPTION. RECENTLY FUNDED STUDIES WILL SOON COMMENCE WITH POPE [INAUDIBLE] COUNTY. THESE PROJECT LEADERS ARE CREATING A PIPELINE OF SHUTTLE READY PROJECTS WHILE EACH OF THESE PROJECTS HAS A UNIQUE MIX OF SERVICES THEY SHARE TWO THINGS IN COMMON. A LARGE; CURRENTLY UNDERSERVED RURAL COUNTRYSIDE THAT WE WILL BE ABLE TO PROVIDE BROADBAND SERVICES TO ALL OF THEIR RESIDENTS AND BUSINESSES. SOMEONE ARGUED THAT THE TWO FUNDING IS INADEQUATE FOR MINNESOTA. THE CAP FUND IS A REAL PROBLEM FOR LOCAL OFFICIALS AND THE COPPER THAT MAY BE A HALF CENTURY OF HER OLD OR OLDER DOES N OT MEET TODAY’S MINIMUM FCC STANDARD WHILE MANY OF THE BROADBAND FALL SHORT OF THE 2022 STATE GOAL AND OTHER RESIDENTS WILL BE LEFT BEHIND WITHOUT THE APPROPRIATE ACTIONS THIS DOES NOT REQUIRE UBIQUITOUS ACCESS. CAP 2 CAN HELP ASSURE THAT NEW NETWORKS WILL MEET AT LEAST THE STATES BROADBAND ACCESS. I ASK THAT YOU SUPPORT THIS BILL.>>CHAIR GAROFALO: WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER:. GOOD AFTERNOON MR. CHAIR AND REPRESENTATIVE. I AM THE CHAIR OF THE CLOAK A VALLEY INTERNET INITIATIVE IS COMPRISED OF SEVEN WORLD TOWNSHIPS IN OUR AREA. WE HAVE BEEN WORKING FOR SINCE 2012 TO BRING BROADBAND TO OUR RURAL COMMUNITIES. I AM HERE TO SUPPORT THE APPROPRIATION OF THE $200 MILLION BORDER TO BORDER INTERNET FUND. MOSTLY THESE ARE WIRELESS SOURCES THAT MOSTLY THESE ARE WIRELESS SOURCES THAT ARE FAIRLY SLOW AND EXPENSIVE. WE ARE LOCATED IN THE DOUGHNUT HOLE BETWEEN THE LAKE COUNTY FIBER PROJECT RAN THE EAST NORTHEAST SERVICES CO-OP TO THE WEST. WE RECEIVED AFEASIBILITY GRANT MATCHED BY AG START IN ST. LOUIS COUNTY TO HIRE CONSULTANTS TO UNDERSTAND THE POTENTIAL AND THE COST FOR BROADBAND DEVELOPMENT. WE REVIEWED THE STUDY’S RESULTS AND MET WITH ALL OF THE PROVIDERS INCLUDING LAKE COUNTY; EFC AND EVEN PAUL BUNYAN COUNTY. ALL OF THEM HAVE REASONS INCLUDING WIRELESS TECHNOLOGY COMMUNICATIONS AND FUNDING AVAILABILITY. THIS MAKES WIRELESS VERY DIFFICULT. MY 6 MILE X 6 MILE TOWNSHIP HAS 185 PEOPLE AND 83 RESIDENCES THE PROXIMITY TO DULUTH MEANS THAT WE HAVE NO THREE STANDING BUSINESSES CLINICS OR LIBRARIES. I WILL SAY THAT THE CENTURY LINK HAS BEEN VERY HONEST WITH US. THIS PAST TWO REQUIRES THEM TO TAKE CARE OF HIGH DENSITY AREAS FIRST AND THEY MAY REACH MY TOWNSHIP BY 2020 OR NOT AT ALL. ARE TOWNSHIP HAS A FULL SPAN THE DEMOCRATIC NEEDS THE FOR BROADBAND ESPECIALLY IF E-LEARNING TAKES THE PLACE AND SENIOR CITIZENS NEED ACCESS TO A VARIETY OF ONLINE SERVICES. ARE TOWNSHIP VOLUNTEER FIRE DEPARTMENTS ALL NEED BROADBAND FOR TRAINING AND COMMUNICATION. ONLY A HANDFUL OF TOWN SUPERVISORS HAVE ADEQUATE ACCESS TO TAKE THE STATE REQUIRED ONLINE TRAINING FOR THE BOARD OF EQUALIZATION. SO; MANY OF THEM HAVE NOT TAKEN THAT TRAINING. ANYWAY; THE HANGING FRUIT IS TAKING CARE OF I THINK WE ARE NOW DOWN TO THE MORE DIFFICULT CHALLENGE OF BRINGING BROADBAND TO BORROW A DENSITY AREAS TO A CITY OR TOWN AND LOW DENSITY MEANS EXPENSIVE CONSTRUCTION. ROADS AND BRIDGES ARE EXPENSIVE AND BROADBAND INFORMATION HIGHWAY IS EXPENSIVE. HOWEVER; ALL OF OUR CITIZENS NEED ACCESS TO HIGH-SPEED INTERNET FOR BUSINESS; EDUCATION; AND CONDUCTIVITY AND THOSE NEEDS EXPAND EVERY DAY. I ASK THAT YOU SUPPORT THIS BILL AND PROVIDE $100 MILLION FOR TWO YEARS FOR BORDER TO BORDER FUNDS SO THAT WE CAN REACH WORLD TOWNSHIP SUCH A S OURS AND MEET SIGNIFICANT PROGRESS FOR BORDER TO BORDER BROADBAND FOR ALL’S.>>CHAIR GAROFALO: SANDSTEDE; DID YOU HAVE ADDITIONAL ALL TESTIMONIES FOR YOUR BILL?>>REPRESENTATIVE SANDSTEDE: I’M FINISHED THANK YOU MR. CHAIR.>>CHAIR GAROFALO: REPRESENTATIVE BAKER TO YOUR BILL.>>REPRESENTATIVE BAKER: THANK YOU MR. CHAIR AND REPRESENTATIVE. I AM NOT GOING TO TALK ABOUT DOLLARS THERE’S NO NEED FOR THAT.AS THE PREVIOUS TESTIFIER TESTIFIED WE CAN’T AFFORD TO MAKE THAT MONEY BACK WITH THOSE CHARGES AND YOU’LL HEAR ABOUT CAP AND THEY ARE IMPORTANT AND THAT IS BRINGING FUNDING TO OUR STATE BUT IT ALSO PROMOTES MEANINGFUL COLLABORATION. IN THE THREE YEARS THAT THE BROADBAND GRANT PROGRAM HAS BEEN IN PLACE THERE HAS BEEN MEANINGFUL COLLABORATION BETWEEN LOCAL GOVERNMENTS AND PRIVATE ENTITIES THAT HAVE RESULTED IN THE SUCCESS STORIES. THERE’S A LOT OF STORIES ABOUT LOCAL GOVERNMENTS IN THE STATE WHO HAVE TRIED TO GO IT ALONE AND HAVE NOT HAD RESULTS BUT THE BROADBAND GRANT PROGRAM HAS SHOWN US WHAT WORKS. THE OTHER POINT ABOUT THE BROADBAND GRANT PROGRAM THAT’S VERY SIGNIFICANT AND I THINK IS UNDERSTATED IS THAT ANYTHING THAT W E PUT IN THE GROUND FOR THIS IS SCALABLE BY 100 X 100. EVERY 100 BITS THAT WE PUT IN THE AIR FOR THIS WE HAVE ON THE GROUND 100 BITS FOR THIS.>>>THIS ALSO REQUIRES MATCHING MONEY. I WILL TALK ABOUT THIS IN MORE DETAIL IN A MINUTE. THE REASON FOR THIS IS THE GRANTS ARE REGIONALLY DISPERSED. IN THE THREE YEARS THE GRANTS HAVE BEEN HAPPENING THEY HAVE BEEN ALL OVER THE STATES OF MINNESOTA AND EVERYONE IN THE STATE OF MINNESOTA HAS HAD ACCESS TO THIS. IS NOT JUST ABOUT THE DOLLAR AMOUNT AND LIKE I SAID; THAT IS UP TO YOU. BUT ONE THING THAT WE DO NEED OUT OF THIS IS PREDICTABILITY. WE ASKED THEM IF YOU DO THIS; IF YOU DO THIS GRANT PROGRAM TO FOR THE WHOLE BENIUM IF WE DO NOT DO THIS THIS YEAR THAT OUR MEMBERS CAN PROVIDE AID THE NEXT YEAR AND THAT FOR THE LAST THREE YEARS OUR GRAND FOLDERS HAVE HAD A LITTLE OVER THEIN ANY OF$65.5 MILLION AND THAT HAS BROUGHT IN 69 $.4 MILLION HAVE COME FROM PARTNERS THAT THEY HAVE HAD WORK WITH THEM AND I THINK THAT SHOWS YOU THIS PROGRAM WORKS AND THEY ARE LEVERAGING THE DOLLARS AND WERE MAKING THE MOST OF THE FUNDING YOU PUT IN THIS PROGRAM. THIS IS ALSO NOT JUST ABOUT GRANTS. THIS IS ALSO ABOUT FUNDING THE OFFICE OF BROADBAND DEVELOPMENT. EVEN IF THE GRANT PROGRAM WENT AWAY THE BAND OF BROADBAND DEVELOPMENT HAS TO BE AROUND OF THOSE CAN BE ANY MONEY IN THE BROADBAND GRANT PROGRAM.>>>THE OTHER THING THAT WE HAVEN’T TALKED ABOUT IS BROADBAND MAPPING. THIS IS CRITICAL. THIS STARTED A FEW YEARS AGO WITH MTA AND THAT REALLY HAS TO CONTINUE BECAUSE WE CAN’T FIGURE WHERE WE WERE GOING AND THE INCREASES THAT WERE MAKING IN BROADBAND EMPLOYMENT IF WE DO NOT MEASURE IT. SO WITH THAT MR. CHAIRMAN I UNDERSTAND YOU HAVE A LOT OF TESTIFIERS I’LL KEEP MY COMMENTS BRIEF BUT I BE HAPPY TO ANSWER ANY QUESTIONS.>>CHAIR GAROFALO: REPRESENTATIVE BAKER; DID YOU HAVE ANY OTHER TESTIFIERS? THIS IS A PUBLIC HEARING IS THERE ANY MEMBERS OF THE PUBLIC THAT WOULD LIKE TO MAKE QUESTIONS OR COMMENTS AB OUT THIS BILL? WELCOME TO THE COMMITTEE PLEASE COME ON DOWN AND STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER: THANK YOU MR. CHAIR REPRESENTATIVES MY NAME IS DAN LARSON. THIS BILL RECOGNIZES THAT A CRITICAL NEED ALSO EXIST IN UNDERSERVED AREAS OF THE STATE. WE PROVIDE ADEQUATE FUNDING TO ADDRESS IN BOTH UNSERVED AND UNDERSERVED AREAS. I WANT TO SPEAK BRIEFLY ABOUT THE LEVELS THAT WE WILL SEE EMERGE. WITH 100 MILLION IN 2018 BE IN AT THE TOP AND 17.5 AND A COUPLE YEARS BEING AT THE BOTTOM ONE. THERE IS A GOLDILOCKS ANALOGY HERE MEMBERS IF ONE POT OF PORRIDGE IS TOO HOT AND ANOTHER IS TOO COLD WE THINK THERE SOMEPLACE IN THE MIDDLE THAT WE COULD HOPEFULLY END UP AND OVER THE COURSE OF A COUPLE OF YEARS MAYBE A 30-35 MILLION DOLLAR RANGE WOULD BE NICE TO PROVIDE THESE GRANDSON STATE OF MINNESOTA. THANK YOU VERY MUCH.>>CHAIR GAROFALO: ANY ADDITIONAL TESTIFIERS REPRESENTATIVE BAKER? WELCOME TO THE COMMITTEE; PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY>>TESTIFIER: MY NAME IS ERIC– I AM HERE AND BROADBAND TECHNOLOGY REPRESENTS A CRITICAL LINK FOR RURAL MINNESOTA. THERE BEEN TECHNICAL ADVANTAGES IN THE LAST 30 YEARS WITH TECHNOLOGY AND TRANSPORTATION AND THE LARGEST CHANGE OF THE CENTURY WAS WHEN NICHOLAS TESLA CHANGE THE WORLD FOREVER AND THE NNEXT CHANGE WAS THE DEVELOPMENT OF THE INTERNET PROTOCOL OVER FIBER-OPTIC LINES. BUT WAS THE GROWTH OF THE BROADBAND NETWORK TO RURAL COMMUNITIES. IT PROVIDED EQUAL ACCESS TO IMPORTANT TECHNOLOGY. TODAY WE ARE CHALLENGED TO PROVIDE AND THE ECONOMIC DEVELOPMENT AND QUALITY OF LIFE THAT WE HAVEN THIS 10 COMMUNITIES M 17 TOWNSHIPS IN THIS FIBER COOPERATIVE THEY COULD NOT HAVE DONE WITHOUT IN 2014. THANK YOU FOR THAT. MINNESOTA LEADS THE NATION IN TECHNICAL NETWORKS. I HAVE BEEN ALL ACROSS THE NATION TALK TO HUNDREDS OF PEOPLE AND EVERYONE IS IMPRESSED WITH WHAT WE DO HERE IN THE STATE OF MINNESOTA. WE ALL APPRECIATE THE FINANCIAL SUPPORT PROVIDED BY YOU ARE ELECTED REPRESENTATIVES BUT WE NEED TO DO MORE. WE NEED TO F UND THE FUND IN AN AMOUNT THAT WILL MEET THE CURRENT DEMAND SSHOWN IN RURAL COMMUNITIES; COUNTIES; AND I SUPPORT THE BROADBAND COMMUNITY AND TASK FORCE IN THIS BILL. THEY ARE THE CRITICAL NETWORK OF THIS CENTURY WE WANT TO INCLUDE THE LIVES OF ALL MINNESOTANS WE NEED TO FIND A WAY TO CREATE A BORDER TO BORDER BROADBAND NETWORK GREETING EVERYONE WITH ASYMMETRICAL CONNECTION TO THE INTERNET AND FOR THEMSELVES. THANK YOU.>>CHAIR GAROFALO: ARE THERE OTHER ANY OTHER MEMBERS THAT WERE THE WOULD LIKE TO TESTIFY IN FAVOR OF THE BILL.WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>AS I JUST MENTIONED IT WOULD BE GREAT TO GET SOMETHING IN THE MIDDLE AS FAR AS MONEY BETWEEN THE TWO BILLS THAT ARE OFFERED. THAT $35 MILLION PER YEAR THERE WAS CERTAINLY A NEED FOR THAT FIGURE THIS YEAR THE GRAMS WE NEED FAR EXCEEDED THE MONEY AVAILABLE SO WE SEE THAT IS SOMETHING THAT HAS ALREADY SHOWN ITSELF. SECONDLY; I WANT TO PLANT THE SEED OF A POLICY CHANGE THAT I HOPE IS NOT A CONTROVERSIAL ONE. IT ADDRESSES THE POSSIBILITY THAT CERTAIN PROVIDERS CAN’T GO CERTAIN PLACES WITH A 50/50 MATCH. THE SOLUTION COULD BE THAT THEY COULD ALLOW FOR THE POSSIBILITY THAT THEY COULD DO A 25% WERE UP TO 75 FROM THE GRANT PROGRAM. IT WOULDN’T HAVE TO BE 75. IT WOULD ALLOW THEM TO MAKE THAT PITCH TO THE OFFICE AND LIKELY THE LAST THAT THEY ARE ASKING FOR THE MORE MERITORIOUS IT IS. I WOULD LIKE TO SEE SOMETHING LIKE THAT IN EITHER OF THESE THAT WOULD ALSO HELP SOME OF THESE AREAS. I ALSO HAVE WITH ME OUR EXECUTIVE DIRECTOR; GARY PETERSON TO GO INTO MORE DETAILS OF THE PROJECT.>>CHAIR GAROFALO: WELCOME TO THE COMMITTEE. PLEASE INTRODUCE YOURSELF TO THE COMMITTEE AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER: GOOD AFTERNOON MR. CHAIR REPRESENTATIVE GARY PETERSON WE REPRESENT THE PEOPLE IN MINNESOTA AND MY GROUP IS HELPING SMALL BUSINESSES SCHOOLKIDS AND ANGER WRITE DOWN THE LIST MEDICAL FACILITIES WE DON’T HAVE THE COUNTERPARTS THE OTHERS IN THE CITY HAVE. IT’S REALLY THE HAVE AND HAVE-NOTS. THAT’S WHAT IT IS COME DOWN TO. I WANT TO GIVE YOU A COUPLE OF EXAMPLES THAT HAVE HAPPENED TO ME AND A COUPLE THAT OF OCCURRED WITH DIFFERENT TOWNSHIP OFFICERS THAT HAVE CALLED ME. AND I HAD ONE OFFICER CALL ME AND HE HAD A HOME-BASED OFFICE AND HE CAN NO LONGERHAVE THAT HOME BASE SYSTEM BECAUSE THE INTERNET WILL NOT PROVIDE HIM ENOUGH SERVICE. WHEN YOU HEAR THINGS LIKE THAT IS THAT MENTALITY THAT IS AT STAKE HERE.>>>I WILL TELL YOU SOMETHING HAPPENED THAT MY HOME. I CAME HOME AND I THEM OF THE AGE OF THE BILLY JOEL GENERATION AND THERE WAS A CONCERT COMING TO MINNESOTA AND I WAS GOING TO ORDER TICKETS WHEN I GOT HOME AND NOW AT MY HOME WE’VE GONE TO THE MAXIMUM WHICH IS WHAT THEY SAY IS 315 UP AND DOWN AND THE DAY THAT I WENT TO ORDER THE TICKETS MY COMPUTERS DOING THAT LITTLE SPINNEY THING; RIGHT; AND I’M TALKING TO MY DAUGHTER ON THE PHONE WHO LIVES IN DOWNTOWN MINNEAPOLIS AND SHE SAID DAD; DO YOU WANT ME TO TRY TO GET YOU THOSE TICKETS ; AND I SAID SURE; WHY NOT AND LESS THAN TWO SECONDS LITERALLY SHE HAD ORDERED THE TICKETS AND PURCHASED THE TICKETS FOR ME AND MY COMPUTER IS STILL GOING LIKE THIS. I CAN TELL YOU A LOT OF STORIES LIKE THAT I’M ONLY 20 MILES FROM AN URBAN CENTER IN ROCHESTER. WE DON’T HAVE WHAT WE NEED. AGAIN; PLEASE FEEL LIKE THAT YOU CAN PUT AS MUCH OR AS MANY DOLLARS FOR BROADBAND AND BUILD UP THIS INFRASTRUCTURE IN A RURAL MINNESOTA. THANK YOU.>>CHAIR: ARE THERE ANY MEMBERS OF THE PUBLIC THAT WISH TO SPEAK ON THE BILL? SEEING NONE. ARE THERE ANY MEMBERS FROM THE OFFICE OF BROADBAND DEVELOPMENT HERE?>>GOOD AFTERNOON. JUST A QUICK QUESTION ABOUT THE HANDOUTS WE WERE GIVING A HANDOUT THAT WAS SHOWING UNDERSERVED AREAS THAT IF SOMEONE HAD A 25 MAKE DOWNLOAD OR THREE MB UNDERSERVED AND THAT THAT WOULD MEET THE STATE GOAL AVENUE IN FIVE YEARS?>>TESTIFIER: MY NAME IS DENA MCKENZIE ON FROM THE OFFICE OF BROADBAND DEVELOPMENT I DO NOT SEE THE HANDOUT. IS THIS THE HANDOUT YOU’RE REFERRING TO? THIS– THE CURRE NT STATE DEFINITION WAS PUT INTO THE STATUTE LAST YEAR WAS SETTING A GOAL OF BORDER TO BORDER ACCESS TO A SPEED THAT IS AT LEAST A 25 X 3 SPEED IN 2022 SO THAT’S WHAT THIS MAP IS REFERRING TO. WHICH ISN’T DIRECTLY TIED TO THE GRANT PROGRAM PER SE. DOES THAT ANSWER YOUR QUESTION?>>CHAIR GAROFALO: NO; AGAIN MY QUESTION WAS IT SAYS 25MB DOWN AND 3 MB UP; AND I’M WONDERING WHY THIS WOULD BE CONSIDERED UNDERSERVED?>>TESTIFIER: SO THAT WOULD BE MEETING THE 2023 GOAL BUT NOT THE 2026.>>>JUST TO MAKE SURE THAT I UNDERSTAND YOU CORRECTLY THESE MEET THE GOAL FOR2022 BUT THEY WOULD NOT MEET IT FOR 2026?>>TESTIFIER: YES.>>CHAIR GAROFALO: THANK YOU.>>THE PROBLEMS THAT I HAVE SEEN WITH THE PROGRAM WOULD BE AROUND A LAKE OR A SPECIFIED AREA AND A LOT OF OUR COUNTIES ARE TRYING TO WORK THIS IS A WHOLE AND LOOK AT THE WHOLE COUNTY AND DO IT I ASSUME IS ONE PROJECT.IS THAT FEASIBLE AND CAN YOU WORK WITH COUNTIES TO DO A PROJECT ON THAT LARGE OF A SCALE?>>REPRESENTATIVE: WE SEE LARGE-SCALE PROJECTS DO THIS AND WE SEEM SMALLER PROJECTS WHERE THEY BUILT AROUND THE LAKE WHERE YOU CAN JUST AFFORD IT ANY OTHER WAY. THERE IS A CAP ON THE GRANTS FOR $30 MILLION THAT CAN DO SOME OF THEM AND WE HAVE TOUCHED THE GAP BUT THE LITTLER PROJECTS WE CANNOT ALWAYS DO THAT.>>REPRESENTATIVE: I JUST HAVE A QUESTION AND A COMMENT. OFTEN TIMES WE HEAR AND WE ARE TALKING ABOUT RURAL AND TOWNSHIPS AND OFTEN TIMES WE HEAR WHY SHOULD WE SPEND SO MUCH MONEY ON PUTTING FIBER IN THE GROUND WHEN WIRELESS TECHNOLOGY WILL BE THE ANSWER IN THE FUTURE.>>REPRESENTATIVE LAYMAN: I WOULD LIKE TO SAY THAT THEY PUT THE WIRE IN WIRELESS AND I WILL ALSO TELL YOU THAT I COME FROM THE INDUSTRY AND MY COMPANY HAS A SMALL TOWN. WHEN THEY’RE USING FIBER TO PREM–>>CHAIR GAROFALOREPRESENTATIVE CHRISTIANSEN WHEN YOU SAY PREM;I UNDERSTAND WHAT YOU MEAN THAT BUT I DON’T KNOW THAT EVERYONE ON THE COMMITTEE KNOWS WHAT YOU MEAN SO PLEASE CLARIFY THAT.>>REPRESENTATIVE CHREIANSEN WE HAVE PREM GOT THE EXPERIENCE WHICH MEANS GOING RIGHT TO THE PREMISES OF THE CLIENT AND WE’VE GOT THE EXPERIENCE AND WE ARE BUILDING ON THIS. DID THAT ANSWER YOUR QUESTION?>>CHAIR GAROFALO:REPRESENTATIVE LAYMAN>>REPRESENTATIVE LAYMAN: IN THIS DAY AND AGE WE CAN DO JUST ABOUT ANY JOB IF WE HAVE THE CONNECTION.>>REPRESENTATIVE CHRISTENSEN: I A LIKE THAT ANALOGY ARE ABOUT GOLDILOCKS AND THE PORRIDGE AND I HOPE WE CAN GET THERE. IT THANK YOU.>>CHAIR GAROFALO: REPRESENTATIVE HOWE.>>REPRESENTATIVE HOWE: I WANT TO APPRECIATE THAT YOU HAVE NOT COME TO MY OFFICE AND ASKED FOR $100 MILLION LIKE YOU DID LAST YEAR’S I APPRECIATE THAT YOU HAVE IN COMMON LIED TO ME. REPRESENTATIVE; COULD YOU TELL ME WHAT IT WOULD TAKE FOR US TO BE DONE WITH THIS HOW MUCH MONEY DO ES THE BROADBAND OFFICE NEED TO GET STATE RIDE ALONG WITH ALL OF THE OTHER FEDERAL MONIES AND THE PRIVATE DOLLARS WHAT’S OUR FINAL DOLLAR FIGURE.>>CHAIR GAROFALO: I HAVE AN ANSWER TO WHAT MIGHT BE DONE WITH THIS BUT IT MIGHT BE DIFFERENT THAN THE TESTIFIER. CAN I HAVE AN ANSWER FROM THE TESTIFIER?>>REPRESENTATIVE: THAT’S WHY I DIDN’T ASK YOU.>>[LAUGHING]>>TESTIFIER:. THANK YOU MR. CHAIR AND REPRESENTATIVE. THIS ESTIMATE WOULD ALLOW THE STATE TO ACHIEVE ITS GOAL AND THIS DID TAKE INTO CONSIDERATION THE CAP I FUNDING AND THAT A FUNDING AND THAT WILL BE COMING INTO THIS GOAL AND THAT WOULD BE APPROPRIATEIN LIEU OF THE TIMEFRAME THAT IS SET.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.>>REPRESENTATIVE MAHONEY: SO THAT $100 MILLION IS THAT $30 MILLION PER YEAR?>>CHAIR GAROFALO: TESTIFIER.>>TESTIFIER: THAT WOULD BE $30 MILLION PER YEAR FOR FIVE YEARS.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY>>REPRESENTATIVE MAHONEY: IF YOU HAD THIS COULD YOU GET THIS DONE SOONER THAN FIVE YEARS? IF THE CAPACITY IN THE STAT E AND THE WORKERS AND THE NEED BE ABLE TO GET IT ALL DONE QUICKER THAN FIVE YEARS OUT?>>CHAIR GAROFALO: TESTIFIER.>>TESTIFIER: MR. CHAIR AND REPRESENTATIVE THERE ARE STATES THAT WE SEE HAVE DONE THIS THEY HAVE TAKEN THIS IN ONE LARGE BITE. OUR STATE DEVELOPMENT PLAN HAS BEEN MORE OF AN INCREMENTAL INVESTMENT PLAN THAT TAKES INTO ACCOUNT TECHNOLOGY AND EVOLUTION OVER TIME AND MAKING SMALLER INCREMENTAL INVESTMENTS WHAT WE HAVE AT THIS TIME IS MORE BETTER SUITED TO SMALLER INCREMENTAL INVESTMENTS.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY.REPRESENTATIVE– OH; UM I’M SORRY REPRESENTATIVE MAHONEY I THOUGHT YOU WERE DONE.>>REPRESENTATIVE MAHONEY: WE NEED TO GET THIS DONE BECAUSE NOT ONLY IS THIS AN ECONOMIC ENGINE FOR GREATER MINNESOTA WE’VE HAD TESTIMONY AFTER TESTIMONY OF PEOPLE SAYING WE ARE BLEEDING PEOPLE OUT OF GREATER MINNESOTA THIS IS A KEY ELEMENT THAT WILL KEEP PEOPLE IN GREATER MINNESOTA UP THEM TO MAINTAIN THE LIFESTYLE THAT THEY NEED TO MAINTAIN I GIVE THEM MORE CHOICES. YOU HAVE RESISTED THIS TIME AND TIME AGAIN. YOUR CAUCUS HAS NEVER BEEN OVERLY SUPPORTIVE OF THIS. THERE’S BEEN A HUGE FIGHT EVERY TIME. WE HAVE A $1.6 MILLION SURPLUS. I HAVE A WAYS AND MEANS CHAIR RIGHT IN FRONT OF ME. IF I MAY ASK THE WAYS AND MEANS CHAIR. MR. CHAIR; MAY I ASK THE FISCAL STAFF?>>CHAIR GAROFALO: YOU MAY ASK.>>REPRESENTATIVE MAHONEY:DO YOU KNOW WHAT IS THE WAGE GAP?>>CHAIR GAROFALO: I WILL SAVE YOU THE TIME. IS $1.6 MILLION. ISN’T THAT CORRECT? YES IS $1.6 MILLION.>>REPRESENTATIVE MAHONEY: THEY ARE AT THE LAST 100 MILES AND THEY NEED TO LAY CABLE AND THEY CANNOT LAY CABLE WITH NOTHING. AND MINNESOTA COMPARED TO THE REST OF THE UNITED STATES FROM WHAT IT WAS BEFORE TO NOW IS HUGE. THIS IS AN ELECTRIFICATION IN GREATER MINNESOTA AND IF WE DON’T DO ALL WE HAVE A SURPLUS WE MAY NOT GET A CHANCE TO DO IT AGAIN AND MINNESOTA WILL SUFFER FROM THIS. NOW I AM DONE.>>CHAIR GAROFALO: REPRESENTATIVE HOWE.>>REPRESENTATIVE HOWE: MY ISSUE IS FOR SOMEONE THAT LIVES FIVE OR 6 MILES FROM ST. CLOUD AND YET I DO NOT HAVE BROADBAND. IF EVERY BODY IT JUMPS ON IT I AM DOWN TO LESS THAN 2 MB AND I AM A SPOT OF THREE HOUSES THAT CANNOT GET INTERNET. THREE HOUSES DOWN THEY GET DSL AND ACROSS THE HIGHWAY THEY GET CABLE. AND WHAT WE FIND IS THAT WE ARE PAINTED AS THOUGH WE HAVE INTERNET IF YOU LOOK AT THE MAP. BUT I’VE GOT LITTLE SPOTS LIKE THAT; ; THREE HOUSES HERE AT HALF A DOZEN HOUSES OVER THEY ARE FIVE HOUSES HERE. HOW DOES THAT GET FIXED? HOW DO YOU PLUG ALL OF THAT IN? IF YOU LOOK AT THE WIDE MAPS THEY PAINT WITH THE WIDE BRUSH AND WERE ALL FILLED IN. SO HOW DOES THAT GET DONE?>>CHAIR GAROFALO: REPRESENTATIVES.>>REPRESENTATIVE: THIS INCLUDES COPPER THIS INCLUDES RUNNING FIBER WHICH WE’RE SEEING WITH THE OFFICE OF BROADBAND BUT RIGHT NOW YOU ARE IN ONE OF THOSE SPOTS THAT IS FEELING THE EFFECT AND REPRESENTATIVE HOWE; I FEEL YOUR PAIN ABOUT THAT BUT THE TWO DOLLARS AND THEIR NUMBERS ARE CONTINUING TO FIND WAYS WITH BROADBAND BUT I CAN TELL YOU THE TECHNOLOGY OF THIS BILL IS UP-AND-COMING AND SO I CAN’T TELL YOU THE EXACT NUMBER OF THE PLAN AND I’M NOT ONE OF THOSE SMART PEOPLE YOU CAN ANSWER THAT FOR YOU.>>CHAIR GAROFALO: REPRESENTATIVE HOWE.>>REPRESENTATIVE HOWE: WELL; IT’S NOT ALL ABOUT ME BUT IT IS ABOUT MY CONSTITUENTS BECAUSE I HAVE CONSTITUENTS THAT WANT TO WORK AT HOME AND HAVE BUSINESSES IN ALL TYPES OF THINGS THEY CAN’T DO IT.>>CHAIR GAROFALO: THANK YOU REPRESENTATIVE HOWE. REPRESENTATIVE WAGENIUS.>>REPRESENTATIVE WAGENIUS: THANK YOU MR. CHAIR; REPRESENTATIVES; HAS ANYONE LOOKED AT THAT HALF OF THE STATE AS PART OF THE PROBLEM? IS THAT A QUESTION THAT HAS BEEN ASKED?>>CHAIR GAROFALO: REPRESENTATIVE.>>REPRESENTATIVE: WE HAVE A GROUP CALLED RECHARGE THE RANGE THERE FOCUSES ON MILLENNIAL’S AND THERE ARE MANY MILLENNIAL’S THAT WOULD LOVE TO COME BACK TO THE AREA BUT THEY CAN’T BECAUSE THEY CANNOTWORK BECAUSE THE TECHNOLOGY IS NOT AVAILABLE. IF THAT TECHNOLOGY WAS THEY ARE THEY WOULD COME BACK AND THAT IS BECAUSE OF THE INFRASTRUCTURE THAT’S REALLY IMPEDING THOSE FROM RETURNING.>>CHAIR GAROFALO: REPRESENTATIVE WAGENIUS.>>REPRESENTATIVE WAGENIUS: I BELIEVE YOU BUT IS THERE A PIECE OF THE PUZZLE THAT’S AFFECTING THIS AND HAS THERE BEEN A FORMAL STUDY THAT INDICATES THINGS THAT ARE ADDING TO THIS IN THE RANGE.>>CHAIR GAROFALO: YOU MAY RESPOND.>>WE DO NOT HAVE A FORMAL STUDY THAT WOULD BE AN EXCELLENT PART OF THE DATA POLICY THAT WOULD HELP US TO MAKE THE DETERMINATION.>>CHAIR GAROFALO: REPRESENTATIVE THEISSEN.>>REPRESENTATIVE THEISSEN: WERE THERE ANY POLICY CHANGES MADE OF AROUND THIS ISSUE?>>CHAIR GAROFALO: TO THE TESTIFIER.>>TESTIFIER: THERE WERE POLICY CHANGES AS FAR AS IT BEING CODIFIED INTO LAW AND THEY HAVEN’T CHANGED THE POLICY LANGUAGE AND THAT’S THE BIGGEST PART OF THE DISCUSSION AND ALL OF THE FEEDBACK THAT WE’VE RECEIVED IS POSITIVE IN NATURE AS FAR AS HOW WE WERE ABLE TO NAVIGATE THE SYSTEMS AND AT THIS TIME; THE OFFICE IS NOT PROPOSING ANY LANGUAGE CHANGES IN THAT REGARD.>>CHAIR GAROFALO: REPRESENTATIVE THEISSEN.>>REPRESENTATIVE THEISSEN: WERE THERE ANY APPLICATIONS THAT WERE CHALLENGED THROUGH ALL OF THIS?>>CHAIR GAROFALO: TO THE TESTIFIER.>>TESTIFIER: THERE WERE A NUMBER OF APPLICATIONS THAT WERE CHALLENGED AND THROUGH THIS WE WERE ABLE TO WORK WITH THESE DEVELOPERS THROUGH THE APPLICATIONS WHEN THEY WERE RECEIVED.>>CHAIR GAROFALO: TTHERE ARE A COUPLE OF QUICK QUESTIONS SO IF SOME OF THE TESTIFIERS COULD COME BACK DOWN MAYBE REPRESENTATIVE CHRISTENSEN MAYBE THE REPRESENTATIVES OF THE TOWNSHIPS. IT WILL BE THE SAME QUESTION RIGHT NOW IT’S 25 MEGABYTES DOWNLOAD AND 3 MB UPLOAD; AND LET’S JUST SAY THAT 25:3 WAS AVAILABLE FOR EVERY ONE IN MINNESOTA WOULD THAT BE AVAILABLE FOR THE DESIGN OF THE BROADBAND INFRASTRUCTURE PROGRAM ARE NOT?>>TESTIFIER: MR. CHAIRMAN I DON’T BELIEVE IT WOULD BECAUSE THE SCALE WOULD BE 100:100. BROADBAND SPEED HAS INCREASED EXPONENTIALLY WHEN YOU THINK ABOUT THE FIRST SPEEDS AND WE SEE THE NEED FOR SPEED GROWING AND WE SEE THE NEED FOR SPEED TODAY FOR 25:3 AND TWO YEARS AGO WE WERE LOOKING AT 10:3.>>CHAIR GAROFALO: CAN I HAVE A COUPLE OF MORE TESTIFIERS COME UP? AGAIN I REPEAT THE QUESTION FOR ANYONE WHO MAY HAVE FORGOTTEN IT. IF I CAN WAVE A MAGIC WAND AND HAVE 25 MB DOWNLOAD AND 3 MB UPLOAD FOR EVERYBODY IN THE STATE; IS THAT POSSIBLE WITH BROADBAND TECHNOLOGY?>>TESTIFIER: JUST A FOLLOW-UP WITH MR. FENSKE’S COMMENT I THINK 25 THREE IS AN EASY TASK IF THEY FIBER AND COPPER-BASED SOLUTION. IF WE GET TO HUNDRED BY 20 OR 100 X 100 THAT IS A FIBROUS SOLUTION AT THIS POINT. SO IF WE SAY HEY LOOK UP TO THIS 25:3 SOLUTION; YOU ARE JUST ASKING FOR A REAL CHALLENGE DOWN FIVE OR SIX YEARS AND I MAY FOLLOW YOU OR YOU MIGHT STILL BE HERE.>>I WON’T DO THAT.>>25:3 THEY HAVE– THE PEOPLE THAT WANT TO WORK IN NORTHERN GREATER MINNESOTA THAT NEED IS THERE FOR THE INFRASTRUCTURE IN THOSE AREAS.>>CHAIR GAROFALO: SO TO REITERATE THIS QUESTION IF AGAIN I COULD WAVE A MAGIC WAND AND ANYONE COULD HAVE 25:3 WOULD THE OFFICE BE FUNDING THE PROGRAM. AGAIN; IF ANYONE COULD HAVE 25:3.>>TESTIFIER: [INAUDIBLE]>>CHAIR GAROFALO: I UNDERSTAND THAT BUT IF ANYONE IN MINNESOTA HAD ACCESS TO 25:3 RIGHT NOW; WOULD WE NEED TO ASSESS A REDEVELOPMENT OF THE STATE PROGRAM? SAME QUESTION TO YOU MR. BAKER. IF 25:3 IS AVAILABLE TO EVERYONE DOES THAT MEAN THE PROGRAM NEEDS TO BE REDESIGNED?>>REPRESENTATIVE BAKER: I THINK IT THAT THE PROGRAM NEEDS TO BE REDESIGNED WHEN W E SEE THAT THE PROGRAM IS NOT MEETING THE NEEDS OF CONSTITUENTS IN MINNESOTA AND I THINK THAT IT SHOULD BE REASSESSED EVERY TWO YEARS AS IT IS AND THE BEST WAY FOR IT TO BE EMPLOYED IS TO BE REASSESSED EVERY TWO YEARS BECAUSE IN TWO YEARS THERE WILL BE THINGS THAT I HAVEN’T EVEN HEARD OF. WIRELESS IS PART OF THE ANSWER AND WE CAN EVER CHANGE THAT. I THINK THAT BROADBAND IS THE BACKBONE; FIBER IS THE BACKBONE BUT IT DOESN’T HAVE TO BE EVERY SINGLE HOME. I DO THINK WIRELESS AND OTHERS WILL REALLY STEP UP WITH AMAZING TECHNOLOGIES. BUT I THINK; AND I SHARE THIS WITH MS. MCKENZIE AS WELL; THAT OFFICE NEEDS ME NOT PLANNING ON A REAL LONG LIFE BECAUSE I THINK THAT WE ARE GOING TO HAVE THIS RESOLVED AND I DON’T THINK THAT THE STATES BUSINESS WHERE ALL HAVE TO IMPROVE IT EVERY GO DOWN THE ROAD IN THE NEXT 10 YEARS AND THAT IS WHERE PRIVATE INDUSTRY WILL TAKE CARE OF THIS BUT WE HAVE TO MAKE SURE YOU HAVE THE RIGHT SPEED OUT THERE RIGHT NOW AND THAT IS WHY I STRONGLY SUPPORT THE OFFICE TODAY AS IT IS TODAY AND I THINK THAT THE POLICY THAT WE USED LAST YEAR WITH THE GRANTS IS EXCEPTIONAL AND WE BROUGHT MORE INCUMBENTS TO THE TABLE IT WAS A STRONG 54% PRIVATE MATCH TO A 45% STATE DOLLAR MATCH . I THINK IT WORKS WELL. THIS IS STILL AN OFFICE OF FOUR IN THE OFFICE OF BROADBAND. THIS IS NOT SOMETHING THAT HAVE EXPLODED. I THINK THAT THEY’VE DONE A NICE JOB BEING EFFICIENT WITH THIS AND I THINK TODAY WE NEED TO WORK ALONGSIDE THE CAP II. PROJECTS. AND I CAN TELL YOU THAT $85 MILLION PER YEAR IS COMING IN TO MINNESOTA RIGHT NOW FOR THE FEDERAL GRANT FOR CAP II DOLLARS AND THAT IS VERY SIGNIFICANT. AND I’M REALLY HAPPY THAT 400 PEOPLE YESTERDAY GOT TURNED ON WITH THIS NEW SERVICE.>>CHAIR GAROFALO: CAN YOU TOP THAT?>>I CAN’T TOP PLOT; NO.>>CHAIR GAROFALO: REPRESENTATIVE SANDSTEDE AND REPRESENTATIVE BAKER MOVES THAT HOUSE FILE 1681 AND 841 FOR POSSIBLE INCLUSION IN A LATER BILL.>>>REPRESENTATIVE SCOTT MOVES AT THAT HOUSE FILE 2112 AT THAT HOUSE FILE 2112 FOR POSSIBLE INCLUSION TO A LATER DATE. REPRESENTATIVE; TO YOUR BILL.>>REPRESENTATIVE KNOBLOCH: THIS PROPOSES TO TAKE A PORTION OF THESEBONDS AND USE THEM FOR MULTIPLE FUNDING PROJECTS THERE IS FEDERAL MATCHING MONEY AVAILABLE FOR THESE PROGRAMS THROUGH— PROGRAMS A LOT OF TIMES THE FUNDING IS ALLOCATED. I HAVE AN AMENDMENT; AND A1 AMENDMENT THAT WOULD LIMIT THE EFFECTS OF THIS BILL TO TWO YEARS WHICH AS I UNDERSTAND IS ROUGHLY AN AMOUNT OF SURPLUS HOUSING TO–>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH MOVES THE A1 AMENDMENT TO GET THE BILL INTO THE CONDITION THAT HE WOULD LIKE TO SEE IT IN. ALL THOSE IN FAVOR SAY; AYE. OPPOSED; NAY>>[CHORUS OF AYES].>>[GAVEL]>>THAT A1 AMENDMENT HAS BEEN MOVED REPRESENTATIVE KNOBLACH PLEASE CONTINUE WITH YOUR BILL.>>REPRESENTATIVE KNOBLOCH: I ASK YOUR SUPPORT OF THIS BILL.>>CHAIR GAROFALO: DO YOU HAVE ANY TESTIFIERS? WE WERE HERE FOR TESTIFIERS AT THIS TIME.>>THIS WILL RESULT IN MORE TAXES AND HOPEFULLY ADD TO THAT $1.65 MILLIONSURPLUS. THE MAIN GOAL IS TO GET WHAT WE CAN OUT OF THAT FEDERAL RESOURCE AND GET MORE OF THOSE JOBS AND PUT FEDERAL HOUSING IN THE SAME PLAYING FIELD AS HOUSING AND THE WORKFORCE IN THE STATE. INCLUDING TAXABLE BONDS AND IT WILL HAVE OTHER CHOICES TO PROVIDE AFFORDABLE HOUSING OR TO ISSUE TAXABLE BONDS IN YOUR REVENUE OUT OF THAT AND I WILL CUT IT OFF THERE BECAUSE IN A VERY BUSY THIS EVENING AND I D O HAVE TESTIFIERS HERE IF YOU HAVE ANY QUESTIONS BUT THE CITY MANAGER WAS HERE AND I HAVE ANOTHER TESTIFIER BUT THEY HAD TO LEAVE FOR ANOTHER COMMITMENT BUT THE REALLY EXCITED ABOUT THIS MAINLY FOR HIS SENIOR HOUSING WE NEED SENIOR HOUSING RIGHT NOW IT ALLOWS PEOPLE TO NOT HAVE TO MOVE OUT OF THEIR HOMES THEY CAN STAY INTO THEIR COMMUNITY BECAUSE THIS WOULD ALLOW FAMILIES TO MOVE BACK INTO THE COMMUNITY AND REINVEST IN THE ECONOMY AND THIS WILL CREATE MORE JOBS AND I THANK YOU AND I YEAH I AM HAPPY TO ANSWER ANY QUESTIONS.>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH; DO YOU HAVE ANY OTHER TESTIFIERS?>>REPRESENTATIVE KNOBLOCH: KNOW THAT IS FINE MR. CHAIR.>>CHAIR GAROFALO: OKAY ARE THERE ANY MEMBERS OF THE COMMITTEE THAT WANT TO MAKE A COMMENT OR HAVE A QUESTION ON THE BILL? AND THIS IS A PUBLIC HEARING SO THAT THERE ANYONE FROM THE PUBLIC WHO WOULD LIKE TO MAKE A QUESTION OR COMMENT ON THE BILL? WELCOME TO THE COMMITTEE. PLEASE INTRODUCE YOURSELF FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER: THIS WELL; AS ALAN MENTIONED BE BONDING FOR HOME OWNERSHIP THAT THE STATE CAN PROVIDE THE COMMUNITIES. THEY RUN A MINNESOTA COMMUNITY PROGRAM. RIGHT NOW THE EXISTING LAW REQUIRES SOME 31% OF THESE BONDING ALLOCATIONS– THE POLICY THAT BONDING ALLOCATION GO TO HOME OWNERSHIP. THIS WOULD AMEND THAT OUT SO COMMUNITIES COULD APPLY FOR IF THEY WANTED RENTAL OR OWNERSHIP OR WHATEVER THEY WANT. MINNESOTA HOUSING GOVERNS THAT HOUSING MINNESOTA HOUSING GOVERNS THE [INAUDIBLE] AND THE HOMEOWNER BENEFITS BECAUSE THE MINNESOTA HOUSING WILL ASSIST WITH THE DOWN PAYMENT AND IF THIS GOES THROUGH THERE WOULD BE LESS REVENUE FOR MINNESOTA HOUSING AND THAT MIGHT BE A CONCERN LEGISLATURES ACROSS THE STATE. HOWEVER THE AMOUNT WE GET IN TAX CREDITS AT LEAST IN OUR OPINION OFFSETS THAT. IN GREATER MINNESOTA THE CURRENT NEED IS LIKE A PYRAMID YOU TO HAVE A LOT OF FOLKS FROM THE LOWER END AND AS WELL YOU HAVE ON THE HIGHER END IN GREATER MINNESOTA IN THE TWIN CITIES IF YOU HAVE SOME OTHER SUBSIDY LIKE THE FEDERAL TAX CREDIT; YOU ARE AT THE TOP OF THE PYRAMID AND YOUR RENTS WILL BE WAY TOO HIGH FOR FOLKS AT THAT LEVEL. WITH THE FEDERAL HOUSING TAX CREDIT; IT BRINGS IT DOWN A NOTCH. IT DOES NOT BRING IT DOWN TO PEOPLE THAT ARE AT THE BOTTOM OF THE PYRAMID AND MANY IN GREATER MINNESOTA. THERE WOULD BE ADDITIONAL SUBSIDY DOLLARS TO BRING IT DOWN. YOU WOULD GO A LONG WAY BY USING THAT TAX CREDIT. IN ADDITION AND FINALLY; IF THAT TAX CREDIT WHICH IS THE 4% TAX CREDIT WHICH IS THE MID-LEVEL TAX CREDIT IS PROVIDED ACROSS THE STATE BUT PRIMARILY IN LARGER COMMUNITIES A SUPPLY OF RENTAL HOUSING THAT TAKES NO ADDITIONAL SUBSIDY; NO ADDITIONAL STATE SUBSIDY IT CAN BE SOMETHING THAT CAN HELP HOUSEHOLDS THAT CANNOT AFFORD RENTS AT THE $800-$1200 RENT LEVEL WITHOUT ADDITIONAL SUBSIDIES. SO THERE IS A VALUE TO THAT AS IT IS BUT YOU CAN THEN TAKE THAT WHEN YOU G O DOWN FROM WHAT IT COST TO CHARGE RENT IF YOU’RE JUST BUILDING NEW AND EAGER DOWN TO THAT TAX LEVEL NOT TAX CREDIT LEVEL AND THEN YOU ARE GOING IN THE DIRECTION WITH SOME ADDITIONAL SUBSIDY TO GET TO THE LOWER INCOME PEOPLE. SO; IT CAN HELP ACROSS THE STATE ALL SORTS OF INCOMES BUT BY AND LARGE; THE VALUE OF THIS BILL IS THAT IT BRINGS IN LOTS OF FEDERAL RESOURCES THAT WOULD NOT OTHERWISE BE AVAILABLE IN THE STATE. THIS IS NOT A SLAMDUNK. THERE ARE REASONS FOR WANTING MINNESOTA HOUSING TO USE AS MUCH OF THAT TAX-EXEMPT BONDING FOR HOME OWNERSHIP AS POSSIBLE THAT BRINGS RESOURCES AND FUNDING TO THEM BUT WHEN YOU MEASURE THIS AGAINST THE AMOUNT OF LEVERAGE TO BRING IN FEDERAL TAX CREDITS IT LOOKS LIKE THE FUNDS COULD BE USED PARTICULARLY IN THIS MARKET. THANK YOU.>>CHAIR GAROFALO: THANK YOU. ARE THERE ANY OTHER MEMBERS OF THE PUBLIC WHO WOULD WISH TO TESTIFY? THANK YOU; WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY>>TESTIFIER: TH IS WILL CREATE RESOURCES THAT ARE NEEDED STATEWIDE. THIS PROPOSAL DOES NOT PROVIDE ASSISTANCE BUT WILL PROVIDE RENTAL HOUSING ACROSS THE STATE. THIS PROVIDES RENTAL HOUSING AS WELL AS SENIOR HOUSING AND THE RESOURCE IS LEVERAGED TO CREATE TH IS IN THE LAST TWO YEARS ALONE. IN FALL 2016 WHAT WE SAW DUE TO MARKETING CONDITIONS IS THAT THEY WERE UNABLE TO GET AN ALLOCATION BECAUSE THE RESOURCE WAS OVERSUBSCRIBED. THIS LEGISLATION IS IN RESPONSE TO THAT SCARCITY AND HAVE MADE SEVERAL SIGNIFICANT CHANGES TO THAT PROCESS. THE LEGISLATION MAKES SIGNIFICANT POLICY CHANGES BASED ON VERY RECENT POLICY CHANGES AND ADDITIONAL HOUSING RESOURCES OR CREATE MORE HOUSING. WE DO CONSIDER THAT A GOOD STEP AND THE BILL SIGNIFICANTLY CHANGES THE STATUTE AND THERE ARE HIGHER CHANGES THAT ARE SEEN IN THE METRO AREA AND IN GREATER MINNESOTA. WE WANT TO MAKE SURE WE CAN MEET BOTH RENTAL AND HOMEOWNER OPPORTUNITIES ACROSS THE STATE WITH THE CHANGING MARKET OPPORTUNITIES THAT WE ARE SEEING. THE SECOND BILL ELIMINATES THE RESOURCES FOR HOMEOWNERS AND COMMUNITIES ACROSS THE STATE. IN 2017 IT WAS $50 MILLION THIS WILL ALLOW CITIES AND COUNTIES TO CREATE FIRST-TIME HOME BUYER PROGRAMS IN THEIR COMMUNITIES AND THEY WILL RE-ISSUE THE BONDS AND THEIR COMMUNITIES AND THIS WILL ALLOW BUSINESSES SMALL AND LARGE ACROSS THE STATE TO PARTICIPATE IN THE PROGRAM . WE ARE ABLE TO SIGNIFICANTLY LEVERAGE THAT RESOURCE AND AS I MENTIONED TO THE TESTIFIERS WE ARE IN CURRENT MARKET CONDITIONS AND WE ARE ABLE TO TAKE THAT $57 MILLION IN LEVERAGE TO CREATE OVER 600 THOUSAND DOLLARS IN RESOURCES BECAUSE WE ISSUE THOSE BONDS. WE ARE WE HAVE OVER 8000 NEW HOMEOWNERS ACROSS THE STATE OVER 90% OF FIRST TIME HOMEBUYERS WILL NEED THIS ASSISTANCE AND THIS IS WHAT DIFFERENTIATES OUR PROJECT WE ARE ABLE TO PROVIDE CLOSING COSTS IN THE SYSTEM AND THIS IS WHAT THIS ALLOWS US TO PERFORM. WE ARE TALKING ABOUT POTENTIAL CHANGES WE CAN MAKE TO INCREASE THESE IN LINE WITH THE MARKET CHANGES AND AS WE WORK WITH MINNESOTA MANAGEMENT AND BUDGET AND OTHER STAKEHOLDERS REVIEWING THOSE CHANGES WE JUST WANT TO MAKE SURE THIS WORKS FOR MINNESOTA AND PROTECTS THE CITY AND COUNTY AND HAS THE BROAD SUPPORT OF THE CITY AND THE COMMUNITY.>>CHAIR GAROFALO: THANK YOU FOR YOUR TESTIMONY ARE THERE ANY OTHER MEMBERS OF THE PUBLIC THAT WISH TO TESTIFY.>>TESTIFIER: I AM ALAN HALLEY AND I SUPPORT THE HOUSING FUND AS WELL AS MY COLLEAGUES HERE WARREN TO SUPPORT THE HOUSING FUN. THE TWO FUNDS HAVE INVESTED MORE THAN $500 MILLION IN PRIVATE CAPITAL IN HOUSING THROUGHOUT THE STATE OF MINNESOTA AND AS SUCH; WE ARE IN A UNIQUE POSITION TO COMMENT BECAUSE WE OPPOSE THIS BILL. THE LEGISLATION SEEKS TO CHANGE THE PRIORITIES OF THE BONDING AUTHORITY AND IN CHANGING THOSE PRIORITIES AND THEIR USE BY COMMUNITIES THROUGHOUT THE STATE. SPECIFICALLY; THIS PROPOSAL REMOVES THE 41% SET ASIDE FOR THE SINGLE FAMILY AND THE BOND RESERVATION AS THEY FOURTH PRIORITY AND THIS IS N OT A BALANCED APPROACH. THIS IS AN IMPORTANT TOOL THAT COUNTIES THROUGHOUT MINNESOTA HAVE USED AS FIRST-TIME HOMEBUYERS AND THIS VALUES RENTAL HOUSING OVER HOMEOWNERSHIP WHILE THE CURRENT STATUTE ALLOWS BOTH OPTIONS BE AVAILABLE FOR THE COMMUNITY. THEY WILL ALSO PROPOSE THIS BE AT THE HIGHEST AND OF THE RENTAL HOUSING PROGRAM AND THESE WORK WHEN THEY CAN BE MAXIMIZED WITHIN THE LIMITS OF THE TAX CREDIT PROGRAM AND FOR THOSE OF YOU WHO REPRESENT COMMUNITIES OF MODERATELY PRICED HOUSING THIS PROPOSED STATUTORY CHANGE WILL NOT PROVIDE MORE HOUSING IN YOUR COMMUNITY. THIS DOES NOT CREATE MORE HOUSING IT JUST MOVES IT AROUND AND IN SHORT IT JUST [INAUDIBLE] IT’S BEEN LARGELY CONFINED TO A SMALL AMOUNT OF DEVELOPERS IN THE AGENCY WITHOUT A MEANINGFUL DIALOGUE OF THOSE WHO WILL BE IMPACTED BY IT. IT’S COMING IN A TIME WHEN THE HOUSE MARKET IS IN FLUX AND IT’S NOT TIME TO MOVE THIS NOW THEY HAVE SUCCESSFULLY MOVED THESE RESOURCES OF THOSE THAT HAVE ACCUMULATED IN THE SYSTEM. WE STRONGLY ENCOURAGE THE COMMITTEE TO REJECT THIS LEGISLATION IN THIS FORM AND WERE WORKING WITH OTHER STAKEHOLDERS TO REALIZE A COMPROMISE FOR THOSE IN COMMUNITIES IN MINNESOTA. THANK YOU VERY MUCH.>>THE CHART THAT IS UP ON THE SCREEN SHOWS THE ANNUAL PROCESS AND ALLOCATIONS THAT WERE MADE AND THERE IS A FLOW IN THE STATUTE OF TIMELINES THAT WERE AVAILABLE FOR FUNDS FLOWING TWO DIFFERENT POOLS. AS OF DECEMBER 1 OF EACH YEAR IF THERE’S ANY MONEY LEFT UNIFIED FOR MINNESOTA HOUSING. I DO WANT TO MENTION THAT WHAT IS HAPPENED IN THE PAST YEARS IS THAT WE ARE ONE OF 10 STATES YOUR WHAT WENT TO WHOLE REAL AND HE WILL BE IN A SHIFT>>THE PROBLEM WITHOUT STATE MINNESOTA IS THE SUBSIDIES HAVE BEEN KEPT UP WITH CONSTRUCTION COSTS AND ON THE FACE OF IT . THINK THAT’S A PRETTY SIMPLE DEAL YOU’RE GIVEN A CAMPUS BY THE LOCAL HOSPITAL AND YOU SHOULD BE ABLE TO DO THAT BUT IT’S NOT THAT EASY AND GREATER MINNESOTA AND THE SIMPLE FACT IS THAT INCOMES DO NOT ALLOW THE RENT AND CONSTRUCTION PROCESS TO CONTINUE TO RISE. AND SO; THERE ARE ISSUES THAT GO BEYOND WHAT WE EVEN SAW TODAY BUT I THINK THAT THE FASTEST GROWING DEMOGRAPHIC IN OUR COUNTRY AND THE POPULATION DOESN’T SEEM RIGHT THAT YOU GET KICKED TO THE BOTTOM AND CAN’T PROVIDE NEW WINDOWS AND NEW BOILERS OR WHATEVER IS NEEDED IN THE PROPERTY AND I GUESS THE LAST THING NEEDED THAT I WOULD POINT OUT AND I HOPE THIS DOESN’T OFFEND ANYONE IS THAT YESTERDAY I TESTIFIED WITH THE SAME BILL BEFORE THE SENATE AND I WAS DISCUSSING WITH MY WIFE AND IT WAS MENTIONING 90 PERCENT OF FIRST-TIME HOME BUYERS NEED A SUBSIDY FOR A HOME AND SHE SAIDWE DON’T COUNSEL OUR KIDS TO MAKE THE KIND OF FINANCIAL DECISION WHY ARE W E DOING THAT. AND SO I THINK THE MINNESOTA HOUSING AND FINANCE AGENCY DOES A GREAT JOB AM NOT HERE TO DETRACT FROM WHAT THEY DO. MAYBE SHIFTING THE PRIORITIES IS A HELPFUL THING.>>CHAIR: ARE THERE ANY OTHER MEMBERS OF THE PUBLIC WHO WOULD LIKE TO QUESTION OR COMMENT ON THE BILL? SEEING NONE. WE WILL MET MOVE TO MEMBER QUESTIONS AND COMMENTS. REPRESENTATIVE CLARK.>>REPRESENTATIVE CLARK: I JUST WANTED TO TALK ABOUT THE IMPACT OR THE UNCERTAINTY ON A FEDERAL LEVEL RIGHT NOW AND I DON’T KNOW IF EITHER ONE OF THEM WOULD LIKE TO SPEAK; WITH THAT UNCERTAINTY; HOW DOES THAT AFFECT YOUR POSITION ON THIS. AND I GUESS; THINGS SEEM VERY UNCERTAIN AND I WONDER IF YOU HAVE FACTORED THAT IN TOO . AND THE FACT IS IT’S NOT JUST THE TAX POLICY AT THE HOUSE POLICY AND I LIKE TO HEAR FROM THE DIRECTOR OF THE HOUSE POLICY RIGHT NOW.>>TESTIFIER: THERE IS A $6 BILLION BUDGET IN USE RIGHT NOW THIS WOULD DO AWAY WITH SOME OF THE RESOURCES THAT PEOPLE HERE IN MINNESOTA USE RIGHT NOW FOR RENT ASSISTANCE AND MONEY WOULD DECLINE RIGHT NOW RADICALLY SO ALL OF THAT IS OUT THERE AND THERE’S ONLY AN INITIAL DRAFT ADMINISTRATION AND I THINK ALL OF THE PRESSURES THAT WERE WHEREOF. WE WILL HOLD DISCRETIONARY SPENDING AND SOMETHING HAS TO GO SOMEWHERE. AND THEN; IT WAS YOU KNOW; DISCUSSED EARLIER ABOUT THE TAX REFORM AND WHAT THAT MIGHT DO TO THE TAX CREDIT AND ALSO LEGISLATION HAS JUST RECENTLY REINTRODUCED ONE THAT WOULD EXPAND THE LOW INCOME HOUSING TAX CREDIT AS PART OF THE TAX REFORM. AND SO; LOTS OF CHANGES OUT THERE AND SOME OF IT IS VERY THREATENING IN TERMS OF HOUSING INITIATIVES IN THE STATE BUT WE HAVE MONTHS TO GO BEFORE WE ACTUALLY KNOW WHAT WILL HAPPEN.>>REPRESENTATIVE: ONE OF THE THINGS THAT THIS PROPOSAL DOES TAKE AWAY FROM FIRST-TIME HOMEBUYERS AND PUT MORE OPPORTUNITIES FOR RENTERS AND RENT DEVELOPED COMMUNITIES. ONE OF THE THINGS THAT WE FACE HERE IN MINNESOTA AS WE HAVE ONE OF THE POOREST RECORDS– A FEW YEARS AGO WE WERE THE THIRD WORST NOW I THINK WE MIGHT HAVE MADE A LITTLE PROGRESS AND BE THE FOURTH OR FIF TH WORSE; SO HAVE YOU MADE ANY PROGRESS WITH THE POSSIBILITIES FOR PEOPLE OF COLOR?>>THE MONIES THAT ARE FUNDED THROUGH FUNDABLE BONDS ARE TAX-EXEMPT BONDS ARE AT AN AFFORDABLE RATE. IS THE DOWN PAYMENT ASSISTANCE THAT THEY ARE ABLE TO TARGET THROUGH LOW INCOME PEOPLE AND ALSO; THEIR PARTICULAR INITIATIVES THROUGH COMMUNITIES OF COLOR TO BUILD UP HOMEOWNERSHIP AND THAT IS SOMETHING THAT I HOPE THE LEGISLATURE PAYS CLOSE ATTENTION TO TO ASSURE THAT THIS IS A STRONG PROGRAM. MINNESOTA HOUSING ITSELF MAKES NET REVENUES THROUGH ITS VARIOUS PROGRAMS AND PUT SOME OF IT RESOURCES INTO THE DOWN PAYMENT ASSISTANCE. THE PROPOSED LEGISLATION WOULD POTENTIALLY TAKE SOME TAX EXEMPT BONDING FROM HOMEOWNERSHIP TO RENTAL HOUSING IF THE MARKET CONDITIONS ARE SUCH THAT THEY HAVE BEEN IN THE LAST COUPLE YEARS BUT NOT THE YEARS BEFORE THEM. IT’S ONLY WHEN THERE ARE UNIQUE MARKET CONDITIONS WOULD THE HOUSING DEVELOPMENT COMMUNITY BE ABLE TO DO THOSE TAX CREDIT PROJECTS AND UTILIZE THE TAX EXEMPT BONDING WITH NO ADDITIONAL STATE SUBSIDY. AND SO; THAT IS THE LEVERAGING THAT AT LEAST OUR ORGANIZATION FEELS IS WORTH SOME COST TO THE STATE IN TERMS OF MINNESOTA HOUSING NOT MAKING THE SAME REVENUES WHEN THEY USE THE TAX EXEMPT BONDING. AND THOSE REVENUES CAN GO INTO THEIR PROGRAM FOR DOWN PAYMENT ASSISTANCE. THAT IS HOW ALL OF THOSE THINGS INTERCONNECT IN A COMPLICATED WAY SO THAT I’M SURE THE COMMUNITY DOESN’T WANT TO HEAR ALL THE DETAILS TO. ESSENTIALLY; WE NEED BOTH RENTAL HOUSING AND HOMEOWNERSHIP PARTICULARLY TO REDUCE TH E DISPARITIES. WE BELIEVE THIS CURRENT PROPOSAL LOSES IN THE DIRECTION OF THE RENTAL HOUSING AND THE VET AND IF THE RENTAL CONDITIONS REMAIN THE SAME AS THEY HAVE IN THE LAST COUPLE OF YEARS AND IF THEY CAN REDUCE SOME OF THE MARGINAL LOSS OF THE DOWN PAYMENT ASSISTANCE.>>I THINK THE CRUX OF WHAT YOU SAID WAS WE WOULD NEED ANOTHER BILL OR ANOTHER LEGISLATION IN TERMS OF NOT GOING BACKWARDS FOR HOME LEGISLATION FOR PEOPLE OF TO ANSWER FROMTHE LEGISLATURE AS WELL.>>REPRESENTATIVE: WE ARE LOOKING AT OPPORTUNITY FOR HOMEBUYERS ACROSS THE STATE. WE CERTAINLY SEE THE OPPORTUNITY CREATE A LOT A FIRST-TIME HOME BUYERS. MINNESOTA HOUSING AND OUR PARTNERS ARE REALLY PROUD OF OUR WORK TO REDUCE THE HOMEOWNERSHIP GAP BETWEEN WHITE HOUSEHOLDS AND HOUSEHOLDS OF COLOR ACROSS THE NATION AND WHAT WILL DO THIS IS OUR ABILITY TO CLOSE THAT GAP AND ALLOW MORE PEOPLE TO FORWARD HOMEOWNERSHIP. WHAT WE’RE REALLY LOOKING AT IS THAT WOULD NOT BE AVAILABLE FOR MINNESOTANS AND WHAT WERE HOPING FOR IS A RANGE OF $500-$600 MILLION IN MORTGAGES NEXT YEAR.>>THANK YOU. AND IF YOU COULD JUST ANSWER THE QUESTION OF HOW YOU SEE THIS IN REGARD OF TO THE DIRECTION OF AFFORDABLE HOUSING AND ALL KINDS OF HOUSING.>>REPRESENTATIVE CLARK. I THINK WE CERTAINLY UNDERSTAND THAT IS WHAT THE BILL IS TRYING TO DO. OUR CONCERN IS THAT IT TAKES IT FROM RESOURCES FOR HOMEOWNERSHIP AND SO; THERE IS A LOT OF UNCERTAINTY IN THE MARKETS RIGHT NOW IN THE TAX REFORM AND THE THIN GS WE BRIEFLY COVERED. AS WE LOOK AT CHANGING THE STATUTE WE WANT TO MAKE SURE WE MAKE CHANGES THAT CONSERN BOTH HOMEOWNERSHIP AND THE RENTAL MARKET AS FAR AS THAT IS CONCERNED.>>CAN YOU SUGGEST SOME THINGS THAT WOULD HELP US TO HAVE SOME RESOURCES DIRECTED TOWARDS THE PEOPLE OF COLOR AND THEIR HOME RESOURCES BUT IF YOU CAN’T COME UP WITH THE LANGUAGEMAYBE I CAN BUT I THINK THAT SHOULD BE ADDED IN. REPRESENTATIVE KNOBLOCH: BASICALLY; THE TAX CREDITS LAST FOR 15 YEARS.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE KNOBLOCH: I CAN IDENTIFY ONE OR TWO REASONS YOU HAVE PEOPLE THAT HAVE INVOLVED IN THE PROJECT FOR THAT 15 YEARS SO IF YOU’RE FROM THAT STANDPOINT A MINIMUM OF 18 YEARS FOR AFFORDABLE HOUSING AND DEPENDING ON THE PROGRAM AND A NUMBER OF THINGS THERE WOULD BE THAT.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE MAYE QUADE: CAN YOU NAME THE FOUR MAJOR AREAS THAT WE HAVE RACIAL DISPARITY HERE IN MINNESOTA? YOU ARE LOOKING AT EMPLOYMENT INCOME EDUCATIONAL OUTCOMES AND HEIL THING. HOUSING IS THE LARGEST IMPACTOR OF THIS. MOST OF THEM WERE LOST DURING THE RECESSION BECAUSE OF HOUSING. I HAD A TESTIFIER MENTION THAT THE REASON WE NEED HELP WITH THIS IS [INAUDIBLE] I’M IN THAT CATEGORY. I RENT AND I WOULD LOVE TO OWN A HOME BUT I’M 20 YEARS OUT. SO WHAT WE NEED TO DO IS REPRIORITIZE. THE BIGGEST THING FOR CLOSERS IS RACIAL DISPARITY AND I THINK WE TALKED ABOUT TAXABLE BONDS VERSUS NONTAXABLE BONDS AND ANY DOLLAR AMOUNT THAT WE ARE TAKING AWAY FROM THIS PROGRAM HELPS 69% OF FAMILIES A COLOR IN THIS LAST YEAR I THINK THIS IS ONE OF THE UNINTENDED CONSEQUENCES AND WE REALLY HAVE TO BE THINKING ABOUT HOW ARE WE HELPING OR HURTING WERE TALKING ABOUT RACIAL DISPARITIES AND TALKING ABOUT HOME OWNERSHIP LAST I THINK THAT WILL INCREASE OUR DISPARITIES.>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH.>>REPRESENTATIVE KNOBLOCH: SO MR. CHAIR AND REPRESENTATIVE MAYE QUADE. AND OTHERS I HAVE JUST BEEN WAITING UP HERE BECAUSE I WANT TO ADDRESS SOME OF THESE CONCERNS AND THERE IS MAYBE 6000 UNITS MORE OF AFFORDABLE HOUSING THAT YOU CAN BUILD OR PERHAPS MORE THAN THAT IF WE DO WERE TALKING ABOUT HERE. SO THERE IS A CERTAIN POOL OF MONEY THAT WE ARE DEALING WITH AND THE QUESTION IS; YOU KNOW; HOW DO YOU WANT TO USE IT. TALKING ABOUT RACIAL DISPARITIES THERE ARE LOTS OF PEOPLE OF MINORITY RACES WHO WILL BENEFIT FROM AFFORDABLE HOUSING THAT WILL BE BUILT UNDERNEATH WHAT I AM PROPOSING THAT WILL NOT BENEFIT OR NOT BE ABLE TO LIVE IN THAT AFFORDABLE HOUSING AND NOT BE ABLE TO GET AFFORDABLE HOUSING IF THEY DON’T DO THIS. SO YOU IN A SENSE TRADING OFFER YOU WANT TO SERVE. I AM NOT AT TRYING TO LEAVE OUT FIRST-TIME HOMEBUYERS AND HOW THEY WANT TO HELP A PART OF THE WAY TO DO THIS IS WITHIN MINNESOTA HOUSING IF THEY WANT TO DO THIS IN FACT; A LOT OF THE MONEY THAT MINNESOTA HOUSING IS USING IS NOT TAKING THESE BONDS SO MUCH T USE THESE BONDS FOR FIRST-TIME HOMEBUYERS BUT THEY ARE ARBITRARY THOSE BONDS AND MAKING MONEY OFF THEM AND USING THAT AS A TRADE-OFF AND IT’S NOT LIKE THEY WON’T HAVE MONEY FOR FIRST-TIME HO ME BUYERS THERE IS A SIGNIFICANT AMOUNT OF MONEY THAT IT IS ADDING UP AND THERE IS A MARKET LOW BUT THERE ARE PEOPLE THAT ARE USING THESE PROGRAMS AS MUCH AS THEY HAD IN THE PAST SO WHAT I WANT TO DO IS BETTER UTILIZE THESE PROGRAMS AND THAT’S WHY I HAD THAT AMENDMENT THAT I OFFERED THAT LIMITED US TO TWO YEARS IN THE WAY THE MARKET CONDITIONS ARE; IT WOULD BE BENEFICIAL TO BUILD MORE AFFORDABLE HOUSING TO DO THIS. WE HAVE A SURPLUS OF MONEY IN MINNESOTA THAT IS AVAILABLE TO DO THIS I’VE TALKED TO THE COMMISSIONER OF HOUSING AND I TALKED HER BECAUSE TWO YEARS IS A REASONABLE AMOUNT OF TIME TO LOOK AT THIS AND THEN WE CAN LOOK AT THAT AGAIN AND IN TWO YEARS THAT MONEY FOR FIRST-TIME HOMEBUYERS MIGHT BE DRAINED DOWN AND AT THAT TIME WE CAN LOOK AT THE WHAT THE MARKET IS LIKE AND WE WILL NEED TO RENEW THAT ARE NOT AND IN THE MEANTIME WE NEED TO BUILD ANY THOUSANDS OF UNITS OF AFFORDABLE HOUSING FOR PEOPLE AND OTHERWISE WE WILL NOT BE ABLE TO HAVE THAT AVAILABLE FOR HOUSING. AND THAT’S WHY I AM BRINGING THAT BILL FORWARD.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE MAYE QUADE: WE ARE TALKING ABOUT A PARADOX AND FOLKS THATARE BUILDING TOWARDS THIS IT MAY NOT BE USEFUL IN A FEW YEARS.>>REPRESENTATIVE KNOBLOCH: I WOULD NOT BE PROPOSING THIS IF THERE WAS NOT MONEY AVAILABLE FOR FIRST-TIME HOMEBUYERS. BUT QUITE FRANKLY THEY HAVE A SURPLUS OF MONEY MORE THAN THEY NEED FROM WHAT I’VE SEEN AND THAT’S WHY THINK WE SHOULD REPRIORITIZE THIS A BIT.>>CHAIR GAROFALO: REPRESENTATIVE MAHONEY>>REPRESENTATIVE MAHONEY. I WILL BE VERY QUICK RIGHT HERE. YOUR INTENTIONS ARE REAL THEY’RE VERY REAL. I REALLY REALLY DO BELIEVE THAT. BUT WHEN YOU SAY SOMETHING IS ONLY THE LAST TWO YEARS AND WE PUT INTO WRITING AND THEN THEN WE MAKE THE COMMITMENT; IF SOMEONE IS MAKING MONEY OFF OF IT; IT TYPICALLY NEVER COMES OUT OF LEGISLATION. WE BOTH KNOW THAT. AND I DON’T– AN D I REALLY DO THINK THAT YOU ARE TRYING TO DO SOMETHING RIGHT HERE AND I GET THAT AND THAT IS MY ONLY CONCERN WITH THIS BILL. IT IS WELL FUELED DEVELOPERS VERSUS LOW INCOME FAMILIES AND UNFORTUNATELY IT’S JUST HOW WE WORK UP HERE. ANOTHER COMPROMISE THERE. I THINK WE DO NEED HIGHER INCOME SUBSIDIZED HOUSING. I THINK THAT’S A GREAT IDEA. BUT I THINK THIS IS MORE PERMANENT THAN IT IS TEMPORARY.>>CHAIR GAROFALO: REPRESENTATIVE; DIGITAL QUESTIONNAIRE? OKAY. REPRESENTATIVES MORAN AND THE REPRESENTATIVE THISSEN.>>REPRESENTATIVE MORAN: IS THERE STILL GONNA BE MONEY FOR FIRST-TIME HOMEBUYERS FOR THEIR HOMEOWNERSHIP?>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH>>REPRESENTATIVE KNOBLOCH: REPRESENTATIVE MORAN THERE WILL STILL BE MONEY AVAILABLE FOR THAT.>>CHAIR GAROFALO: REPRESENTATIVE MORAN.>>REPRESENTATIVE MORAN: WHAT DO YOU CONSIDER AVERAGE INCOME?>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH.>>REPRESENTATIVE NOG BLOCK THERE IS THE MEDIAN AVERAGE IN; AND WHEN WE LOOK AT THESE THINGS I WOULD GO WITH NOT MY STANDARD BUT THE STANDARD THAT WE SEE IN THE LAND.>>CHAIR GAROFALO: REPRESENTATIVE MORAN: REPRESENTATIVE MORAN: WILL THIS BUILD MORE HOUSING FOR THE URBAN CORE BUT IS THIS SOMETHING THAT YOUR COMMUNITY IS NOT SUPPORTING ARE WE TALKING ABOUT MORE AFFORDABLE HOUSING IN THE URBAN CORE?>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH.>>REPRESENTATIVE KNOBLOCH: IT WILL MAINTAIN A HIGH PRIORITY UNDER THE STATUTE AND WHAT WE’RE TALKING ABOUT IS ONCE THAT IS REQUESTED THAN OTHER NEW CONSTRUCTION WOULD BE ABLE TO BE SERVED. SO THAT IS THE AREA THAT THIS WOULD BE HITTING AND ONE THING THAT I WANT TO POINT OUT FOR AFFORDABILITY FOR SINGLE-FAMILY USE IT DETECTS AN EVEN HIGHER AFFORDABILITY OF 60% OR MORE MEDIAN INCOME SO IT’S ACTUALLY SERVING A LOWER INCOME POPULATION AND THE WAY THE FEDERAL PROGRAM WAS SET UP IS IF YOU START MAKING TOO MUCH MONEY THEN YOU CANNOT STAY IN THAT PROGRAM. SO THIS IS DESIGNED THAT YOU COULD START IN A RENTAL PROGRAM AND MOVE INTO HOMEOWNERSHIP. SO THIS IS ACTUALLY AN IMPROVEMENT IN TERMS OF AFFORDABILITY THAN WHAT CURRENTLY EXISTS IN STATUTE THANK YOU.>>CHAIR GAROFALO: REPRESENTATIVE MORAN.>>REPRESENTATIVE MORAN: I HAVE ONE MORE QUESTION I WOULD LIKE REPRESENTATIVE KNOBLOCH TO ANSWER PLEASE. WHY IS THERE A SHORTAGE OF AFFORDABLE HOUSING?>>CHAIR GAROFALO: REPRESENTATIVE I WOULD NOTE THAT REPRESENTATIVE APPLEBAUM ALSO A PRESENTER OF THIS BILL.>>REPRESENTATIVE HOUSE FILE 2266 ESTABLISHES AN OPPORTUNITY OF A GRANT PROGRAM IN THE AREAS OF EDUCATION AND ECONOMIC DEVELOPMENT AND HOUSING THIS IS A LONGTIME FIXTURE OF THE ST. CLOUD COMMUNITY OF OVER $100 MILLION OF CHARITABLE GRANT FUNDS IN MINNESOTA IN ORGANIZATIONS AND DESPITE THE LARGE INCREASE IN MINORITY POPULATIONS IN THE LAST FEW YEARS THERE WERE NO MONEY AT ALL IN ECONOMIC DISPARITY INITIATIVES FOUND ITS WAY TO MINNESOTA. I WOULD APPRECIATE YOUR SUPPORT.>>CHAIR GAROFALO: REPRESENTATIVE KNOBLOCH; DO ANY TESTIFIERS THAT YOU HAVE PRESENTING?>>REPRESENTATIVE KNOBLOCH: NO I DO NOT.>>CHAIR:. REPRESENTATIVE KNOBLOCH IS ASKING THAT HOUSE FILE 2266 BE LAID OVER BY FOR POSSIBLE INCLUSION UNTIL A LATER DATE. ALL THOSE IN FAVOR SAY; AYE. OPPOSED; NAY>>[GAVEL]>>WE ARE GOING TO LOOK OVER THESE THESE LAST TWO BILLS AND THEN WE WILL RECESS FOR DINNER AND WE WILL COME BACK TOGETHER AROUND SEVEN. REPRESENTATIVE; TO YOUR BILL.>>REPRESENTATIVE: WHAT THIS BILL REALLY DOES IS THE REREGULATION AND DEREGULATION BILL. AND WHAT WERE GOING TO DO TODAY IF THIS BILL PASSES IS WE WILL SIMPLY KEEP DOING WHAT WE’RE DOING TODAY. THAT IS ALL IT DOES. IT IS ACTUALLY QUITE SIMPLE IN THAT YOU ARE GOING TO HEAR LOTS OF TESTIMONY AND ARGUMENTS SAYING THIS DOESN’T DO THIS AND THIS DOESN’T DO THAT AND ALL WE’RE DOING IS THESE VOICEOVER IT SERVICES WORK ON ALLOW REGULATIONS TO CONTINUE HAPPENED THEY WERE DOES NOT CAN ASK PUC FOR ANYTHING FOR THAT.>>CHAIR GAROFALO: DO YOU HAVE ANY TESTIFIERS REPRESENTATIVE?>>REPRESENTATIVE YES I DO.>>>>TESTIFIER: GOOD EVENING CHAIR GARFOLA AND MEMBERS OF THE COMMITTEE. I’LL KEEP MY THE COMMENTS SHORT I KNOW YOU HAVE A LOT TO GET THROUGH TONIGHT. I JUST WANT TO CONTINUE SUPPORT HOUSE FILE 1665. HOUSE FILE 1665 IS A STRONG LEGISLATION FOR STATE TO PROVIDE COMPETITIVE OPTIONS FOR VOICE COMMUNICATION SERVICES IN MINNESOTA AND PRESERVE EXISTING LANDLINE PHONE SERVICES FOR ALL MINNESOTANS AND CONSUMER PROTECTIONS AVAILABLE TO ALL MINNESOTANS. IT WILL STRENGTHEN THE 911 TELEPHONE ASSISTANCE PROGRAM AND THE ACCESS MINNESOTA PROGRAMS BY REQUIRING ALL VOICEOVER INTERNET PROVIDERS TO PAY INTO THESE FUNDS IN THE 911 PLANS AND FINALLYTTHEESE STATES WILL MODERNIZE THESE COMMUNICATION LAWS FOR THIS POLICY. I’M HAPPY TO ANSWER ANY QUESTIONS BUT I LEAVE MY COMMENT SAID THAT THANK YOU.>>CHAIR GAROFALO: THANK YOU AND WELCOME TO THE COMMITTEE AND PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY>>TESTIFIER:. I WILL KEEP MY COMMENTS BRIEF AND JUST DIRECT YOU TO A LETTER IN YOUR PACKET IN SUPPORT OF HOUSE FILE 1665. IT STATES THAT BY PROVIDING A LEVEL OF CERTAINTY HOUSE FILE 1665 WILL PROVIDE A LEVEL OF TELECOMMUNICATION THROUGHOUT THE STATE. HAPPY TO ANSWER ANY QUESTIONS.>>CHAIR GAROFALO: THANK YOU. WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER: THIS BILL THROWS REGULATION WE WOULD HAVE A VERY DIFFERENT DISCUSSION HERE. WE DON’T BELIEVE IT OF FEDERAL. WE BELIEVE IT DOES THE OPPOSITE. WE BELIEVE THIS COMPLETELY D REGULATES PHONE SERVICE IN MINNESOTA ESPECIALLY IF YOU USE VOICE WHICH VIRTUALLY ALL OF THE PHONE COMPANIES CAN DO. SO I MEAN; IT DOESN’T REALLY MATTER IF THE PHONE CALL IS COPPER OR FIBER CABLE OR VOICE BUT WERE TOLD THAT IS A PHONE CALL ANY PHONE CALL IS A PHONE CALL AND THERE’S REALLY NO RATIONALE OR PUBLIC POLICY RATIONALE AND WE WOULD TREAT ANY OTHER PHONE CALL. WHAT THIS BILL DOES IS ELIMINATES THE PUC’S AUTHORITY OVER LOCAL PHONE CALLS MADE THROUGH VOICE. AND BY DOING SO; IT EFFECTIVELY RENDERS VIRTUALLY ALL THE LAWS AND RULES THAT PROTECT CONSUMERS MEANINGLESS AND UNENFORCEABLE AND OVER ONE TYPE OF DELIVERY; DELIVERY BY VOICE OVER OTHER MECHANISMS OF LIKE SAYING WE SHOULD REGULATE UPS DIFFERENT THAN WE DO FEDEX THAT’S JUST A LOGICAL.>>>SO HERE IS IN FACT WHAT THE BILL DOES AND SOME BUT NOT ALL THE HARMFUL IMPACTS THAT YOU WILL BE VOTING FOR IF YOU VOTE TO INCLUDE THIS IN THE OMNIBUS BILL.>>CHAIR GAROFALO: AND JUST TO BE CLEAR W E ARE NOT VOTING ON THIS BILL TODAY BUT SHOULD THERE BE A VOTE ON THIS ON THE FUTURE THERE WOULD BE A LOT MORE QUESTION ANSWER THROUGH THIS TESTIMONY.>>TESTIFIER: IN THE FUTURE IF YOU SHOULD VOTE FOR THIS BILL THIS WHAT YOU IN THE FUTURE IF YOU SHOULD VOTE FOR THIS BILL THIS WHAT YOU WOULD VOTE FOR. FIRST OF ALL; THERE’S NO NOTICE OF PROTECTION PROTECTION OF ARBITRARY OR UNWANTED SHUT OFF OF PHONE SERVICE. THERE BE NO PROTECTION OF GEOGRAPHICAL DISCRIMINATION THERE IT BE NO CRAMMING OR UNAUTHORIZED CHARGING OR SLIPPING OF THE BILL. IF YOU DON’T THINK THAT HAPPENS; I HAVE AN ARTICLE HERE FROM FORBES THAT TALKS ABOUT A PHONE GIANT AT&T CONSUMERS BILL WITH UNWANTED SERVICES. IT IS KNOWN AS CRAMMING. AND; THIS HAPPENS. THERE WILL BE NO PROTECTION FROM FRIDAY NIGHT FROM COMPANIES COMING INTO MINNESOTA PROVIDING SERVICES BECAUSE YOU WOULD NO LONGER HAVE TO CERTIFY COMPANIES FOR BEING LEGIT OR A POWER TO GET RID OF THEM IF THEY DID SOMETHING WRONG. THERE WOULD BE NO MORE OVERSIGHT OVER RELIABILITY OF 911 DESPITE WHAT THE TESTIFIER SAYS BECAUSE VOICE PHONE CALLS WILL BE NO LONGER WRITE REGULATED BY THE PUC. AND; IF YOU DO NOT THINK THAT IS THE PROBLEM GIVEN NPR NEWS STORY HERE THAT TALKS ABOUT HAVING GAPS IN HOME SERVICE THROUGH 911 CALLS ROUTED TO THE INTERNET FOR VOICEOVER PROTOCOLS. THE GEOGRAPHIC ANSWER PROTOCOLS WHEN SOMEONE CALLS 911 DOESN’T ALWAYS WORK IN THAT THE PROBLEM. THE FIRST AND FOREMOST; THIS IS REALLY IN A LEGAL MATTER. WHAT YOU’RE DOING HERE IS OVER’S ROLLING A PUC DECISION AND THOSE PHONE CALLS MUST FOLLOW THESE RULES AND THAT TURNS INTO A HIGHLY ILLEGAL SITUATION IN A DEBATE AND THIS UNDOUBTEDLY WILL WIND UP IN THE UNITED STATES COURT OF APPEALS THROUGH THE A CIRCUIT AND THE UNITED STATES SUPREME COURT. AND BEFORE THAT HAPPENS THE CONGRESSMEN WOULD STEP IN AND RESOLVE THE ISSUE AND WITH ALL DUE RESPECT WE BELIEVE THEY WOULD DEFER TO THAT JUDICIAL OR REGULATED BODY FOR THAT SERVICE.>>I CAN GO ON BUT I WENT BECAUSE I KNOW THAT YOU’RE PRESSED FOR TIME BUT THE REALITY IS THIS IS A DEREGULATION BILL AND IT WILL NOT PROVIDE ANY INCENTIVE TO INVEST IN BROADBAND ACROSS MINNESOTA AS WE’VE HEARD. IT WILL DEREGULATE ALL OF THE PROTECTIONS THAT EXIST TODAY AND I WOULD STRONGLY URGE YOU NOT TO MOVE FORWARD WITH THIS BILL. I’M HAPPY TO ANSWER ANY QUESTIONS.>>CHAIR GAROFALO: WELCOME TO THE COMMITTEE PLEASE STATE YOUR NAME FOR THE RECORD AND PROCEED WITH YOUR TESTIMONY.>>TESTIFIER:. THANK YOU MR. CHAIR AND REPRESENTATIVES WE ARE HERE TO SPEAK TODAY IN OPPOSITION OF THIS BILL BECAUSE IT WOULD UNNECESSARILY ELIMINATE IMPORTANT CONSUMER PROTECTION RELATING TO AN INCREASINGLY POPULAR TELECOMMUNICATION SERVICE KNOWN AS VOICE. AS THE TELECOMMUNICATION NETWORK MIGRATES TO TECHNOLOGY BASED ON INTERNET PROTOCOL OTHERWISE KNOWN AS IPN CONSUMER NEEDS AND RELIABLE SERVICE AND REGULATORY OVERSIGHTS AS MR. ELWOOD SAID REGARDLESS OF HOW THE TECHNOLOGY IS DELIVERED; TELEPHONE COMMUNICATION REMAINS A BASIC NECESSITY ALLOWING OLDER MINNESOTANS WHETHER THEIR NEIGHBORHOODS ARE RURAL AREAS OF THE STATE TO MAINTAIN SOCIAL CONTACT TO MAINTAIN HEALTH AND SAFETY AND TO REACH OUT AND AN EMERGENCY. VOICE TECHNOLOGY IS ESSENTIALLY A WIRELINE OR WIRELESS ALTERNATIVE TO A TRADITIONAL VOICE SERVICE AND THIS ALLOWS MANY TO OBTAIN COMMUNICATION IT’S ALSO IMPORTANT TO POINT OUT THEN THAT THE AMENDMENT THAT WAS ON THE LAST COMMITTEE FOR SECTION 5 SAYS THAT NOTHING WILL RESTRICT OR MODIFY A COMPANY’S ABILITY TO OFFER PHONE SERVICE. WELL; TWO THINGS TO THAT. FIRST OF ALL; AS I SAID MANY COMPANIES ARE TRANSITIONING TO IP PHONE CALLS. MANY TELEPHONE LINES ARE USING BOTH IP PROTOCOL AND TRADITIONAL WHAT WE CALL TBM AND I’M NOT CAN EXPLAIN THAT TODAY BUT THEY ARE USING BOTH FIBER AND COPPER TO GET TO YOUR TELEPHONES. SO WHEN YOU LOOK AT THIS LANGUAGE WHILE IT SORT OF ASSUMES THAT IT’S GOING TO BE PROTECTED; CONSUMERS DO NOT KNOW IF THEY HAVE; YOU KNOW; NEW TECHNOLOGY OR NOT. AND SO; ALL WE ARE SAYING IS FOR THE END-USER AND FOR THE CONSUMER; IT DOES NOT MATTER HOW IT IS DELIVERED ; IT MATTERS THAT IT IS RELIABLE. I ALSO WANT TO POINT OUT THAT THE LANGUAGE ON 315 THAT SAYS ALL IT HAS TO SAY IS THAT THE COMPANY CAN OFFER LANDLINE SERVICE. IT DOES NOT SAY THAT THEY HAVE TO BE PROVIDING HER UNDER THE REGULATORY RUBRIC. AND SO AS MR. ELWOOD SAID; IT ELIMINATES ALL THE CONSUMER PROTECTIONS AND WE DON’T THINK THAT’S NECESSARY. THE LAST POINT THAT I WANT TO MAKE IS WE KNOW THAT THE CONSUMERS VOICE IS STEADILY GROWING BUT THERE IS NO EVIDENCE OF THIS BROADBAND INVESTMENT AND WE DO BELIEVE IN THIS NEW TECHNOLOGY BUT CONTRARY TO THE RHETORIC; WE DON’T THINK IT’S IN EITHER/OR OPTION. WE THINK IT IS SOMETHING THAT PEOPLE SHOULD HAVE PROTECTIONS THAT GO ALONG WITH NEW TECHNOLOGY AND YOU SHOULD NOT SUCCUMB TO IDLE THREATS OF WITHHOLDING INNOVATION AND INVESTMENTS IN MINNESOTA. THEY SHOULD BE IGNORED AND WE ASKED YOU TO OPPOSE THIS BILL. THANK YOU.>>CHAIR GAROFALO: JUST A QUICK QUESTION BEFORE REPRESENTATIVE GRANT COMES DOWN A QUICK QUESTION FOR BOTH OF THE TESTIFIERS; T HERE IS NO PHYSICAL COST ON THIS BILL SO THERE’S RELATIONS THIS WE USUALLY SEE SOME SORT OF FISCAL COST AND WHY IS THAT?>>TESTIFIER: I THINK IT WOULD BE THE DEPARTMENT OF COMMERCE IS PURVIEW TO ANSWER THAT QUESTION.>>CHAIR GAROFALO: REPRESENTATIVE GRANT. WELCOME TO THE COMMITTEE AND IT’S GOOD TO SEE YOU AGAIN.>>TESTIFIER: GOOD EVENING MR. CHAIR AND REPRESENTATIVES I’M COMMISSIONER ADELE GRANT ANDI AM HERE TODAY TO TALK ABOUT THE IMPORTANCE OF CONSUMER PROTECTION THAT’S CURRENTLY PROVIDED FOR MINNESOTA TELEPHONE CUSTOMERS. IT HAS BEEN DETERMINED OVER THE YEARS THAT THESE ARE PROTECTIONS THAT ALL MINNESOTANS SHOULD HAVE THINGS SUCH AS REQUIRE THAT NOTICE BE GIVEN BEFORE SERVICE IS DISCONNECTED. REQUIRING A NOTICE OF THE COST OF THE SERVICE BEFORE IT’S INCREASE AND REQUIRING TELEPHONE SERVICES WHO WILL CUSTOMERS BE THE SAME AS METRO CUSTOMERS AND THAT SERVICE AREA. HOUSE FILE 1665 REGULATES THE TECHNOLOGY RATHER THAN THE SERVICE TO THE CONSUMERS. IF THE SERVICE IS THE SAME; SHOULDN’T CONSUMER PROTECTIONS AND THE RO LE OF GOVERNMENT ALSO BE THE SAME? BUT EVEN BEFORE THAT; THE COMMITTEE SHOULD CONSIDER AN EVEN MORE BASIC QUESTION AND THIS WAS ONE THAT WAS RAISED FOR MR. L WHAT IS THIS ONE THAT CAN TAKE PLACE AT THIS TIME. THERE IS A LAWSUIT THAT IS CURRENTLY PENDING IN FEDERAL COURT THAT WILL DECIDE WHETHER THE STATE CAN REGULATE THE TELEPHONE SERVICE AND IF IT DOES NOT THEN THE COMMITTEE SPEND VALUABLE TIME ON SOMETHING IT DID NOT NEED TO DO. IF ON THE OTHER HAND THE FEDERAL COURT DETERMINES THAT THE STATE DOES HAVE AUTHORITY; THAT WOULD BE A REASONABLE TIME TO DECIDE WHAT IF ANY CHANGES FOR CUSTOMERS IN LIGHT OF THE CHANGE IN TECHNOLOGY. ONE LAST THING TO CONSIDER IS THE EFFECT THIS BILL WILL HAVE ON THE RATES OF TELEPHONE SERVICE IN RURAL AREAS. BE FORE THE DRASTIC CHANGES THAT ARE MADE FOR THE BILL IS PASSED; IT WILL BE PRUDENT TO DETERMINE HOW ROLE RURAL TELEPHONE SERVICES WILL INCREASE IN THOSE AREA AND THANK YOU FOR HEARING AS AND ALLOWING US TO DISCUSS OUR CONCERNS WITH THIS BILL>>CHAIR GAROFALO: THANK YOU AND THIS IS A PUBLIC HEARING. ARE THERE AN Y QUESTIONS OR COMMENTS FROM THE PUBLIC ON THIS BILL? SEEING NONE WILL CLOSE PUBLIC HEARING>>[GAVEL]>>THERE ARE MANY OTHER GROUPS TRYING TO INFLUENCE THIS IN MANY WAYS I’M JUST TRYING TO GET US TO THESE BASIC GROUPS AND THIS DOESN’T HAVE TO HAPPEN ON THE VOICE LINE IT’S FUNDAMENTALLY DIFFERENT AND WHEN MY SON CALLS ME ON FACEBOOK; WE DON’T NEED TO REGULATE THAT.>>CHAIR GAROFALO: COMMISSIONER GRANT.>>CO MMISSIONER GRANT: I DON’T SPEAK FOR TH E GOVERNOR HOWEVER THIS IS VIRTUALLY IDENTICAL OF A BILL TO THE BILL THAT WE HAD LAST YEAR’S SO YOU CAN TAKE THAT FOR WHAT IT’S WORTH AND I WOULD NOT BE HERE EXPRESSIN G MY CLOSE CONCERNS IF WE ARE REALLY DEALT WITH IT.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE MAYE QUADE: CAN YOU TELL ME HOW THIS WILL AFFECT BROADBAND?>>CHAIR GAROFALO: REPRESENTATIVE>>REPRESENTATIVE: I DO NOT SEE HOW THIS WILL AFFECT THAT.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE. CAN YOU TELL ME HOW THESE CONSUMER PROTECTIONS WILL BE PUT INTO PLACE?>>REPRESENTATIVE: THOSE ARE IMPEDING AT THIS IN BROADBAND AND I JUST WANT TO UNDERSTAND HOW THAT’S HAPPEN ING.>>REPRESENTATIVE IF THIS BILL DOES NOT GOING TO AFFECT BASICALLY>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE MAYE QUADE: I STILL UNDERSTAND HOW THAT AFFECTS THE REGULATIONS IN MINNESOTA BECAUSE IF THEY DID NOT HAVE THE MONEY THEY WOULD BE– I DON’T KNOW THE WORDS AM TRYING TO USE HERE BUT ESPECIALLY WITH THE COURT CASE; CAN YOU SPEAK TO THAT A LITTLE BIT.>>CHAIR GAROFALO: REPRESENTATIVE KRESHA.>>REPRESENTATIVE KRESHA: THE FIRST COURT CASE THE ARGUMENT WAS IS VOICE TELEPHONE SERVICE THE SAME TYPE OF SERVICE AND THE ANSWER CAME BACK NO. IT’S DIFFERENT TECHNOLOGY. THAT HAS BEEN THE CASE IN EVERY SINGLE CASE AND THE ARGUMENT IS THAT VOICE IS NOT ANALOG TELEPHONE SERVICE.>>CHAIR GAROFALO: STAFF WHAT I THINK WERE GONNA DO IS CREATE A YOUTUBE CLIP OF THE DEBATE ON THE HOUSE FLOOR WITH REPRESENTATIVE SANDERS AND REPRESENTATIVE JOHNSON AND WE WILL PUT IT TOGETHER FOR MEMBERS OF THE COMMITTEE TO WATCH THAT SO WE DO NOT HAVE THAT HAPPEN ON THE FLOOR AGAIN.>>REPRESENTATIVE KRESHA: I AM OKAY WITH IT.>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE.>>REPRESENTATIVE MAY E QUADE: I JUST WANT TO MAKE SURE THAT THIS IS PUTTING THE CERTAINTY.>>CHAIR GAROFALO: REPRRESENTATIVE KRESHA.>>REPRESENTATIVE KRESHA: IF I’M NOT SURE WHY WERE THINKING THIS IS NOT PUTTING INTO CERTAINTY?>>CHAIR GAROFALO: REPRESENTATIVE MAYE QUADE: WELL IT’S SOMETHING AT THE COURT CASE THEN IT’S NOT PUT IN THE CERTAINTY. I REALLY FEEL LIKE YOU ARE COMPARING YOUR SON MAKING A C ALL OVER FACEBOOK DOES NOT EQUATE WHAT WERE TALKING ABOUT HERE.>>CHAIR GAROFALO: ANY OTHER QUESTIONS FROM THE COMMITTEE? REPRESENTATIVE KRESHA ANY CLOSING COMMENTS?>>REPRESENTATIVE KRESHA: NO MR. CHAIR.>>CHAIR GAROFALO: THEN WE MOVE THAT THAT HOUSE FILE WOULD BE LAID OVER FOR POSSIBLE INCLUSION. REPRESENTATIVE HOPPE; TO YOUR BILL.>>REPRESENTATIVE HOPPE: WE HAVE A BILL HERE THAT NOBODY LIKES AND NOBODY IS REALLY LIGHT FROM THE START THAT WE HAVE TECHNOLOGY THAT EVERYBODY LIKES. WE HAVE THE PROPONENTS AND OPPONENTS OF THE PEOPLE OF THE BILL OF THE TECHNOLOGY WHO HAVE BEEN WORKING DILIGENTLY. THAT THE HAVE BEEN WORKING AND THEY HAVE A COUPLE OF MEETINGS LAST MONDAY AND ON FRIDAY AND THE TRYING TO MAKE THIS WORK AND OUR HOPE IS THAT WE CAN GET THIS LAID OVER FOR POSSIBLE INCLUSION AND BY TIME WE REACHED THE OMINOUS BILL THEY CAN FIGURE OUT A WAY TO QUICKLY GET THE TECHNOLOGY IN PLACE IN CITIES ALL ACROSS THE STATE OF MINNESOTA AND WITH THAT I WILL TURN IT OVER TO THE TESTIFIERS.>>CHAIR GAROFALO: BEFORE WE TURN IT OVER TO THE TESTIFIERS I WOULD LIKE THE RECORD TO NOTE THAT THE CHAIR IS SAYING THAT THE I WOULD LIKE TO CHANGE THIS BILL TO THE REPRESENTATIVE HOPPE FULL INCLUSION BILL BILL.>>REPRESENTATIVE HOPPE: IS EVERYBODY BEHIND ME LAUGHING.>>>W HEN I TALK ABOUT SMALL CELL; I’M TALKING ABOUT THE NEXT GENERATION OF INFRASTRUCTURE THAT IS AN INTEGRAL PART OF DELIVERING BETTER COVERAGE OF WHAT WE CALL THE IDENTIFICATION OF THE NETWORK. WE KNOW YOUR CONSTITUENTS WANT THIS AND I WILL GIVE YOU A SPECIFIC EXAMPLE AT&T’S CONSUMPTION HAS GONE UP OVER TO AN THOUSAND PERCENT IN THE LAST 10 YEARS IT CONTINUES TO GROW AND GROW AND GROW P WITH THE MYRIAD OF APPLICATIONS OF SMARTPHONE APPLICATIONS AND ALL OF THESE SORT OF THINGS. WE NEED ADDITIONAL INFRASTRUCTURE TO HELP DEEPEN THIS COVERAGE AND HELP REALLY GET THE NETWORKS READY FOR REALLY THE REVOLUTION AND NOT EVOLUTION OF 5G>>[PLEASE STANDBY FOR THE MINNESOTA HOUSE OF REPRESENTATIVES JOB GROWTH AND ENERGY AFFORDABILITY POLICY AND FINANCE COMMITTEE MEETING OF TUESDAY; MARCH 14; 2017]>>[GAVEL]>>CHAIR GAROFALO: GOOD MORNING AND WELCOME TO THE MEETING OF THE JOB GROWTH AND ENERGY AFFORDABILITY POLICY AND FINANCE COMMITTEE FOR TUESDAY; MARCH 14; 2017. OUR FIRST ORDER OF BUSINESS IS APPROVAL OF THE MINUTES REPRESENTATIVE ANDERSON MOVES THE MINUTES OF MARCH 17 2017. ARE THERE ANY CHANGES; CORRECTIONS OR ADDITIONS?>>>ALL THOSE IN FAVOR PLEASE SIGNIFY BY SAYING AYE.>>[CHORUS OF AYES]>>>OPPOSED; NAY. THE MINUTES ARE ADOPTED.>>THE FIRST BILL IS HOUSE FILE REPRESENTATIVE MOVES THE AMENDMENT TO GET THE BILL IN THE FORM THAT THE AUTHOR WOULD LIKE.>>>ALL THOSE IN FAVOR PLEASE SIGNIFY BY SAYING AYE.>>[CHORUS OF AYES]>>>OPPOSED.>>CHAIR: THE AMENDMENT IS ADOPTED. REPRESENTATIVE FABIAN; DO YOU HAVE ANY MORE AMENDMENTS?>>REPRESENTATIVE FABIAN: NO SIR.>>CHAIR: REPRESENTATIVE FABIAN; TO YOUR BILL.>>REPRESENTATIVE FABIAN: THEY ARE PLANNING AN EXPANSION OF 1 MILLION NEW SQUARE FEET OF SPACE THERE FOR BUSINESS THAT THEY DO. THEY ARE PROJECTING TO HIRE 1000 PEOPLE IN THE NEXT 10 YEARS THEY EMPLOY ABOUT 3200 PEOPLE IN THIEF RIVER FALLS RIGHT NOW AND THE IMPACT THIS HAS ONE MINNESOTA IS VERY VERY SIGNIFICANT AND IT IS MY CONVICTION CHAIR TO SEE WHAT I CAN DO TO SEE THAT THIS BILL GOES INTO EFFECT. WE WOULD LIKE TO ACCESS THE BDPI PROGRAM AND ALSO THE INVESTMENT FUND AND WITH THAT I WILL TURN IT OVER TOMY TESTIFIER.>>CHAIR: PLEASE IDENTIFY YOURSELF FOR THE COMMITTEE AND GIVE YOUR TESTIMONY.>>TESTIFIER:WE WOULD ENTER INTO A BUSINESS AGREEMENT WITH THE BUSINESS AND AT ANY TIMEWE MAY CALL BACK

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