Legislature(1993 - 1994)
1993-07-21 House JournalFull Journal pdf
1993-07-21 House Journal Page 1956 HB 116 The following letter dated June 3, 1993, was received: "Dear Speaker Barnes: I am allowing the following bill to become law without my signature and am transmitting the engrossed and enrolled copies to the Lieutenant Governor's office for permanent filing: COMMITTEE SUBSTITUTE FOR HOUSE BILL NO. 116 (FIN)(title am) "An Act amending the manner of determining the royalty received by the state on gas production, and directing the commissioner of natural resources to accept, under certain circumstances, the contract price agreed to between a lessee of federal land and a gas or electric utility as the value of the federal government's royalty share from natural gas production on federal land from which the state is entitled under applicable federal law to receive a share of the royalty on gas production; and providing for an effective date." Chapter 53, SLA 1993 [Effective Date: See Chapter] It has been and continues to be one of my highest priorities to assure that the state's oil and gas lessees pay their full royalty and severance tax obligations to the state so that all of Alaska's citizens benefit from those shared resources. It was for that reason that I pursued what some regarded as a controversial course of insisting that the federal government collect additional royalties which we believe were owed from lessees in Cook Inlet, even though the cost of those additional royalties would eventually be passed on to Chugach Electric consumers in the Anchorage area. It was a difficult decision, but under the law as it existed, I felt I had no alternative but to act on behalf of all Alaskans who would have benefitted by virtue of the state's receiving 90 percent of those royalties. House Bill 116 represents the Legislature's decision to amend that law to remove the financial uncertainty to which Chugach Electric customers were subject pending final resolution of our appeal to the federal government that it properly manage its royalty obligations to the state. I steadfastly maintained neutrality during the Legislature's 1993-07-21 House Journal Page 1957 HB 116 deliberations of this bill. On balance, because the legislation has very narrowly focused on accepting lower royalty values for sales to public utilities which directly benefit Alaska consumers, I believe the legislation should not be vetoed. On the other hand, I do not want to send conflicting signals that the state will not pursue vigorously its full royalty and tax entitlements from such a valuable nonrecurring resource. The Legislature has seen fit to carve out a narrow exception to this general policy, and I will not disagree with that decision. However, in recognition of the inevitable policy tension which this bill reflects, I have decided to allow House Bill 116 to become law without my signature. Sincerely, /s/ Walter J. Hickel Governor"