Tuesday, October 05, 2010

Alaska Voters To Weigh In On Proposition A To Authorize $600 Million To Guarantee Veterans' Residential Mortgages In The November 2010 Election

While the buzz about the upcoming November general election in Alaska has been dominated by the U.S. Senate race between Joe Miller, Lisa Murkowski and Scott McAdams, as well as the gubernatorial race between Sean Parnell and Ethan Berkowitz, three statewide initiatives on the ballot have received very little attention. These initiatives include Propositions A and B (a pair of bonding propositions), and Ballot Measure 1 (reorganization of state legislature). This post is designed to provide some background and publicity on Proposition A; information of Proposition B is HERE, and on Ballot Measure 1 HERE. Primary information source is the Alaska Division of Elections website.

Bonding Proposition A - State Guaranteed Veterans Residential Mortgage Bonds, $600,000,000. Specific ballot language given below:

"Shall the State of Alaska unconditionally guarantee as a general obligation of the state the payment of principal and interest on revenue bonds of the Alaska Housing Finance Corporation issued in the principal amount of not more than $600,000,000 for the purpose of purchasing mortgages made for residences for qualifying veterans, as defined by law?"

This proposition was enabled by Alaska SB217, which also authorizes the Alaska Housing Finance Corporation (AHFC) to acquire the building that it occupies at 4300 Boniface Pkwy in Anchorage for an amount not exceeding $14,500,000 and to authorize the AHFC to acquire a building or purchase an undesignated site for the relocation of its public housing client intake and assisted housing center for an amount that does not exceed $3,500,000. The final text of SB217 indicates that the additional $17.5 million has already been appropriated and is separate from the $600 million specified in the proposition.

The text of SB217 references AS 18.56 and also defines a "qualifying veteran" as a person who is a "qualified veteran" as that term is defined, or may be subsequently defined under 26 U.S.C. 143. The latter reference, in defining a "qualified veteran", states "For purposes of this subsection, the term 'qualified veteran' means in the case of the states of Alaska, Oregon, and Wisconsin, any veteran who served on active duty, and who applied for the financing before the date 25 years after the last date on which such veteran left active service, and in the case of any other State, any veteran who served on active duty at some time before January 1, 1977, and who applied for the financing before the later of the date 30 years after the last date on which such veteran left active service, or January 31, 1985". Other terms and conditions, to include the value of the property and its intended use, are also set forth. The required character of service (Honorable vs. Undesirable) is not specified.

Legislative History: On March 31st, 2010, SB217 passed in the Senate with 18 Yes votes. There weren't any No votes; one was absent, and the other excused. Then on April 14th, the House passed it with 38 Yes votes, with two members excused. While the state legislature is hardly "inerrant", such an overwhelming vote of approval indicates the measure is sound.

Recommend a Yes vote on November 2nd.

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