(JUNEAU) - The Alaska State Senate unanimously approved House Bill 203 by a vote of 20 to zero on Monday. Sponsored by the House Finance Committee and carried by Finance member Rep. Mike Hawker (R-Anchorage), HB 203 clarifies the definition of income that is subject to dividends for the state General Fund from the Alaska Industry Development and Export Authority. HB 203 excludes expenses recorded by the authority as a result of recognizing impairment losses on development projects. All cash expenses will continue to be subtracted from gross income to calculate the dividend that AIDEA will pay the state; however, impairment losses, which do not affect the authority's operating income, will no longer be considered.

"Impairment losses recognize the reduced value of projects that the authority already paid for," Hawker said. "Impairment losses do not require any current cash expenditures."

Under previous statute, impairment losses recognized on the Healy Clean Coal Project and Alaska Seafood International would have eliminated any dividend from AIDEA in Fiscal Year 2004; however, AIDEA has operating earnings and substantial liquid assets from which a dividend could be paid. The dividend formula proposed by House Bill 203 will provide a nine to 18 million-dollar dividend for Fiscal Year 2004.

"AIDEA has a very successful portfolio of assets," Hawker said. "The state needs a steady dividend on its investments, and, this amended AIDEA dividend policy is a logical change that is sound financial practice and good fiscal policy."

After a reconsideration vote, HB 203 will move to the Governor.

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