Legislature(1995 - 1996)

1995-04-19 House Journal

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1995-04-19                     House Journal                      Page 1367
HB 207                                                                       
The following was read the second time:                                        
                                                                               
HOUSE BILL NO. 207                                                            
"An Act relating to adjustments to royalty reserved to the state to           
encourage otherwise uneconomic production of oil and gas;                      
relating to the depositing of royalties and royalty sale proceeds in           
the Alaska permanent fund; and providing for an effective date."               
                                                                               
with the:                                                 Journal Page         
                                                                               
                                                                               
	O&G RPT  CS(O&G) NEW TITLE 4DP 1NR 2AM                            848         
	O&G LETTER OF INTENT                                              849         
	INDETERMINATE FISCAL NOTE (REV)                                   849         
	FISCAL NOTE (DNR) 3/8/95                                          850         
	ZERO FISCAL NOTE (REV) 2/27/95                                    850         
	RES RPT  CS(RES) NEW TITLE 4DP 2NR 1AM                            994         
	ZERO FISCAL NOTE (REV) 2/27/95                                    994         
	FIN RPT  CS(FIN) NEW TITLE 7DP 1AM                               1343         
	FISCAL NOTE (DNR) 3/8/95                                         1344         
	INDETERMINATE FISCAL NOTE (REV) 3/22/95                          1344         
	ZERO FISCAL NOTE (REV) 2/27/95                                   1344         
                                                                               
                                                                               
Representative Vezey moved and asked unanimous consent that the                
following committee substitute be adopted in lieu of the original bill:        
                                                                               

1995-04-19                     House Journal                      Page 1368
HB 207                                                                       
CS FOR HOUSE BILL NO. 207(FIN)                                                
"An Act relating to adjustments to royalty reserved to the state to           
encourage otherwise uneconomic production of oil and gas; and                  
providing for an effective date."                                              
                                                                               
There being no objection, it was so ordered.                                   
                                                                               
                                                                               
Amendment No. 1 was offered  by Representative Rokeberg:                        
                                                                               
Page 4, line 1, insert a new paragraph to read:                                
                                                                               
	"(8) shall offer to appear before the Legislative Budget and               
Audit Committe on a day that is not earlier than 10 days and                   
not later than 20 days after giving public notice under (7) of                 
this subsection, to provide the committee a review of the                      
commissioner's preliminary findings and determination on the                   
royalty reduction application and administrative process; if the               
Legislative Budget and Audit Committee accepts the                             
commissioner's offer, the committee shall give notice to all                   
members of the legislature of the committee's meeting.                       
                                                                               
Renumber the following paragraphs accordingly.                                 
                                                                               
                                                                               
Representative Rokeberg moved and asked unanimous consent that                 
Amendment No. 1 be adopted.                                                    
                                                                               
Representative Brice objected.                                                 
                                                                               
Representative Barnes rose to a point of order and cited Section 101(5)        
of Mason's Manual.                                                             
                                                                               
The Speaker indicated the point was well taken.                                
                                                                               
Representative Brown placed a call of the House.                               
                                                                               
The call was satisfied.                                                        
                                                                               
The question being:  "Shall Amendment No. 1 be adopted?"  The roll             
was taken with the following result:                                           

1995-04-19                     House Journal                      Page 1369
HB207                                                                        
                                                                               
CSHB 207(FIN)                                                                  
Second Reading                                                                 
Amendment No. 1                                                                
                                                                               
YEAS:  20   NAYS:  17   EXCUSED:  3   ABSENT:  0                             
                                                                               
Yeas:  Austerman, Brown, Bunde, Davies, Finkelstein, Green,                    
Grussendorf, Hanley, Kohring, Kott, Kubina, Masek, Ogan, Phillips,             
Porter, Robinson, Rokeberg, Toohey, Vezey, Willis                              
                                                                               
Nays:  Barnes, Brice, G.Davis, Elton, Foster, Ivan, James, Kelly,              
Mackie, MacLean, Martin, Moses, Mulder, Nicholia, Sanders,                     
Therriault, Williams                                                           
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
And so, Amendment No. 1 was adopted.                                           
                                                                               
                                                                               
Amendment No. 2 was offered  by Representatives Brown and                       
Therriault:                                                                    
                                                                               
Page 4, following line 21, insert a new paragraph to read:                     
                                                                               
	"(C) transmit a copy of the final findings and                             
determination to the lessee;                                                 
                                                                               
Page 4, line 23, after "decision":                                         
                                                                               
Insert "and"                                                              
                                                                               
Page 4, line 24:                                                               
                                                                               
Delete "(10) shall"                                                       
                                                                               
Page 4, lines 25 and 26:                                                       
                                                                               
Delete all material.                                                          
                                                                               
Reletter the following subparagraphs accordingly.                              

1995-04-19                     House Journal                      Page 1370
HB 207                                                                       
Representative Brown moved and asked unanimous consent that                    
Amendment No. 2 be adopted.                                                    
                                                                               
Objection was heard and withdrawn.                                             
                                                                               
There being no further objection, Amendment No. 2 was adopted.                 
                                                                               
Amendment No. 3 was offered  by Representatives Brown and                       
Therriault:                                                                    
                                                                               
Page 1, line 10, following "REGULATIONS TO":                                   
                                                                               
Insert "ALLOW REDUCTION"                                                      
                                                                               
Delete "allow reduction"                                                      
                                                                               
Following "TO]", insert "provide for modification"                        
                                                                               
Page 2, line 17:                                                               
                                                                               
Delete "reduction of"                                                         
                                                                               
Insert "[REDUCTION OF]"                                                       
                                                                               
Page 2, line 17, after "royalty":                                              
                                                                               
Insert "modification"                                                     
                                                                               
Page 2, line 18, following "requesting the":                                   
                                                                               
Insert "change"                                                           
                                                                               
Delete "reduction"                                                            
                                                                               
Insert "[REDUCTION]"                                                          
                                                                               
Page 2, line 19:                                                               
                                                                               
Delete "reduction"                                                        
                                                                               
Insert "modification"                                                     

1995-04-19                     House Journal                      Page 1371
HB 207                                                                   
Representative Brown moved and asked unanimous consent that                    
Amendment No. 3 be adopted.                                                    
                                                                               
Objection was heard and withdrawn.                                             
                                                                               
There being no further objection, Amendment No. 3 was adopted.                 
                                                                               
                                                                               
Amendment No. 4 was offered  by Representative Davies:                          
                                                                               
Page 3, line 17, after "(B)":                                              
	Insert "except as provided in (11) of this subsection,"                   
                                                                               
Page 4, following line 29:                                                     
	Insert a new paragraph to read:                                               
		"(11)  shall, notwithstanding AS 38.05.035(a)(9) and                      
(5)(B) of this subsection, make available to a legislative                     
committee, on request of the person who chairs the committee,                  
all information and data obtained by the commissioner and                      
considered by the commissioner in making the final findings                    
and determination; a legislative committee to which the                        
legislators, whether or not members of the committee, to whom                  
the information and data are provided under this paragraph                     
shall maintain the confidentiality of information obtained by                  
the commissioner that is otherwise made confidential by law;"                
                                                                               
Renumber the following paragraph accordingly.                                  
                                                                               
Representative Davies moved and asked unanimous consent that                   
Amendment No. 4 be adopted.                                                    
                                                                               
Representative James objected.                                                 
                                                                               
The question being:  "Shall Amendment No. 4 be adopted?"  The roll             
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 4                                                                
                                                                               
YEAS:  6   NAYS:  29   EXCUSED:  3   ABSENT:  2                              

1995-04-19                     House Journal                      Page 1372
HB 207                                                                       
Yeas:  Brown, Davies, Finkelstein, Grussendorf, Nicholia, Robinson             
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Elton, Foster,                
Green, Hanley, Ivan, James, Kelly, Kohring, Kott, Kubina, Mackie,              
MacLean, Martin, Masek, Moses, Mulder, Ogan, Phillips, Porter,                 
Rokeberg, Therriault, Toohey, Vezey, Willis                                    
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Sanders, Williams                                                     
                                                                               
And so, Amendment No. 4 was not adopted.                                       
                                                                               
                                                                               
The House stood at ease at 12:14 p.m.                                          
HB 207                                                                       
Amendment No. 5 was offered  by Representative Davies:                          
                                                                               
Page 4, line 23, after "decision":                                         
	Insert "; however, the commissioner  may not implement the                  
determination made under (B) of this paragraph unless the                      
legislature first convenes in regular or special session and, within           
the first 60 days of a regular session, or within the entirety of a full       
session if of shorter duration, does not adopt a joint resolution,             
concurred in by a majority of the members in each house, that                  
disapproves the determination"                                               
                                                                           
Representative Davies moved and asked unanimous consent that                   
Amendment No. 5 be adopted.                                                    

1995-04-19                     House Journal                      Page 1373
HB 207                                                                       
Representative Brice objected.                                                 
                                                                               
                                                                               
The question being:  "Shall Amendment No. 5 be adopted?"  The roll             
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 5                                                                
                                                                               
YEAS:  5   NAYS:  31   EXCUSED:  3   ABSENT:  1                              
                                                                               
Yeas:  Brown, Davies, Finkelstein, Grussendorf, Nicholia                       
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Elton, Foster,                
Green, Hanley, Ivan, James, Kelly, Kohring, Kott, Kubina, Mackie,              
MacLean, Martin, Masek, Moses, Mulder, Ogan, Phillips, Porter,                 
Robinson, Rokeberg, Sanders, Therriault, Toohey, Vezey, Willis                 
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Williams                                                              
                                                                               
And so, Amendment No. 5 was not adopted.                                       
                                                                               
                                                                               
Amendment No. 6 was offered  by Representative MacLean:                         
                                                                               
Page 4, line 18, following "determination;":                               
                                                                               
Delete through line 21, after "court"                                     
                                                                               
                                                                               
Representative MacLean moved and asked unanimous consent that                  
Amendment No. 6 be adopted.                                                    
                                                                               
Representative Rokeberg objected.                                              
                                                                               
                                                                               
The question being:  "Shall Amendment No. 6 be adopted?"  The roll             
was taken with the following result:                                           

1995-04-19                     House Journal                      Page 1374
HB 207                                                                       
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 6                                                                
                                                                               
YEAS:  9   NAYS:  26   EXCUSED:  3   ABSENT:  2                              
                                                                               
Yeas:  Brown, Davies, Finkelstein, Grussendorf, Kubina, MacLean,               
Nicholia, Robinson, Willis                                                     
                                                                               
Nays:  Austerman, Barnes, Bunde, G.Davis, Elton, Foster, Green,                
Hanley, Ivan, James, Kelly, Kohring, Kott, Mackie, Martin, Masek,              
Moses, Mulder, Ogan, Phillips, Porter, Rokeberg, Sanders, Therriault,          
Toohey, Vezey                                                                  
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Brice, Williams                                                       
                                                                               
And so, Amendment No. 6 was not adopted.                                       
                                                                               
                                                                               
Amendment No. 7 was offered  by Representative Finkelstein:                     
                                                                               
Page 3, lines 19 - 26:                                                         
	Delete all material and insert:                                               
		"(6)  may require the lessee or lessees making                            
application for the royalty reduction to pay for the services of               
a contractor, selected by the commissioner from a list of                      
qualified consultants in hydrocarbon production and economics                  
prepared by the commissioner, to assist the commissioner in                    
evaluating the application and financial and technical data;"                
                                                                               
                                                                               
Representative Finkelstein moved and asked unanimous consent that              
Amendment No. 7 be adopted.                                                    
                                                                               
Representative Green objected.                                                 
                                                                               
The question being:  "Shall Amendment No. 7 be adopted?"  The roll             
was taken with the following result:                                           

1995-04-19                     House Journal                      Page 1375
HB 207                                                                       
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 7                                                                
                                                                               
YEAS:  10   NAYS:  27   EXCUSED:  3   ABSENT:  0                             
                                                                               
Yeas:  Brown, Davies, Elton, Finkelstein, Grussendorf, Kubina,                 
MacLean, Moses, Nicholia, Robinson                                             
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Foster, Green,                
Hanley, Ivan, James, Kelly, Kohring, Kott, Mackie, Martin, Masek,              
Mulder, Ogan, Phillips, Porter, Rokeberg, Sanders, Therriault, Toohey,         
Vezey, Williams, Willis                                                        
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
And so, Amendment No. 7 was not adopted.                                       
                                                                               
                                                                               
Amendment No. 8 was offered  by Representative Brown:                           
                                                                               
Page 4, lines 18 - 21:                                                         
	Delete "the commissioner's final findings and determination                 
prepared under this subparagraph regarding royalty reduction is                
final and not appealable to the court;"                                      
	Insert	"the commissioner's final findings and determination                 
prepared under this subparagraph                                               
		(i)  is, as to the applicant, final and not                               
appealable to the superior court;                                              
		(ii)  may be appealed to the superior court by                            
a person other than the applicant, but the appeal is                           
limited to a determination that the commissioner's                             
final findings and determination is constitutional and                         
was not arbitrary, capricious, or confiscatory;"                             
                                                                               
Representative Brown moved and asked unanimous consent that                    
Amendment No. 8 be adopted.                                                    
                                                                               
Representative Rokeberg objected.                                              
                                                                               

1995-04-19                     House Journal                      Page 1376
HB 207                                                                       
The question being:  "Shall Amendment No. 8 be adopted?"  The roll             
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 8                                                                
                                                                               
YEAS:  10   NAYS:  27   EXCUSED:  3   ABSENT:  0                             
                                                                               
Yeas:  Brown, Davies, Elton, Finkelstein, Grussendorf, Kubina,                 
MacLean, Nicholia, Robinson, Willis                                            
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Foster, Green,                
Hanley, Ivan, James, Kelly, Kohring, Kott, Mackie, Martin, Masek,              
Moses, Mulder, Ogan, Phillips, Porter, Rokeberg, Sanders, Therriault,          
Toohey, Vezey, Williams                                                        
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
And so, Amendment No. 8 was not adopted.                                       
                                                                               
                                                                               
Amendment No. 9 was offered  by Representative Brown:                           
                                                                               
Page 3, line 16:                                                               
	Delete "and"                                                              
                                                                               
Page 3, line 18, after "request;":                                         
	Insert "and                                                                 
		(C)  shall, with the applicant's consent, prepare                          
and make public a summary of the economic, financial,                          
and technical data on which a royalty modification is                          
based;"                                                                      
                                                                               
Representative Brown moved and asked unanimous consent that                    
Amendment No. 9 be adopted.                                                    
                                                                               
Representative Green objected.                                                 
                                                                               
The question being:  "Shall Amendment No. 9 be adopted?"  The roll             
was taken with the following result:                                           

1995-04-19                     House Journal                      Page 1377
HB 207                                                                       
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 9                                                                
                                                                               
YEAS:  6   NAYS:  28   EXCUSED:  3   ABSENT:  3                              
                                                                               
Yeas:  Brown, Davies, Elton, Finkelstein, Nicholia, Robinson                   
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Foster, Green,                
Hanley, Ivan, James, Kelly, Kohring, Kott, Kubina, Mackie, MacLean,            
Martin, Moses, Mulder, Ogan, Phillips, Porter, Rokeberg, Therriault,           
Toohey, Vezey, Williams, Willis                                                
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Grussendorf, Masek, Sanders                                           
                                                                               
And so, Amendment No. 9 was not adopted.                                       
                                                                               
Amendment No. 10 was offered  by Representative Brown:                          
                                                                               
Page 3, line 8:                                                                
                                                                               
Delete "90"                                                               
                                                                               
Insert "75"                                                               
                                                                               
Representative Brown moved and asked unanimous consent that                    
Amendment No. 10 be adopted.                                                   
                                                                               
Representative Rokeberg objected.                                              
                                                                               
The question being:  "Shall Amendment No. 10 be adopted?"  The roll            
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 10                                                               
                                                                               
YEAS:  6   NAYS:  27   EXCUSED:  3   ABSENT:  4                              

1995-04-19                     House Journal                      Page 1378
HB 207                                                                       
Yeas:  Brice, Brown, Davies, Finkelstein, Nicholia, Willis                     
                                                                               
Nays:  Austerman, Bunde, G.Davis, Elton, Green, Hanley, Ivan, James,           
Kelly, Kohring, Kott, Kubina, Mackie, MacLean, Martin, Masek,                  
Moses, Mulder, Ogan, Phillips, Porter, Robinson, Rokeberg, Therriault,         
Toohey, Vezey, Williams                                                        
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Barnes, Foster, Grussendorf, Sanders                                  
                                                                               
And so, Amendment No. 10 was not adopted.                                      
                                                                               
                                                                               
Amendment No. 11 was offered  by Representative Brown:                          
                                                                               
Page 1, line 10, after "may":                                              
                                                                               
Insert "with the consent of the Governor"                                 
                                                                               
Representative Brown moved and asked unanimous consent that                    
Amendment No. 11 be adopted.                                                   
                                                                               
Representative Rokeberg objected.                                              
                                                                               
Representative Bunde placed a call of the House.                               
                                                                               
The call was satisfied.                                                        
                                                                               
                                                                               
Amendment to Amendment No. 11 was offered  by Representative                    
Brown:                                                                         
                                                                               
After "with the":                                                          
                                                                               
Insert "written"                                                          
                                                                               
Representative Brown moved and asked unanimous consent that the                
amendment to Amendment No. 11 be adopted.  There being no                      
objection, it was so ordered.                                                  
                                                                               

1995-04-19                     House Journal                      Page 1379
HB 207                                                                       
The question being:  "Shall Amendment No. 11 as amended, be                    
adopted?"  The roll was taken with the following result:                       
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 11 as amended                                                    
                                                                               
YEAS:  14   NAYS:  23   EXCUSED:  3   ABSENT:  0                             
                                                                               
Yeas:  Brown, Davies, Elton, Finkelstein, Green, Grussendorf, Kubina,          
Mackie, MacLean, Martin, Moses, Nicholia, Robinson, Willis                     
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Foster, Hanley,               
Ivan, James, Kelly, Kohring, Kott, Masek, Mulder, Ogan, Phillips,              
Porter, Rokeberg, Sanders, Therriault, Toohey, Vezey, Williams                 
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Williams changed from "Yea" to "Nay".                                          
                                                                               
And so, Amendment No. 11 as amended, was not adopted.                          
                                                                               
Amendment No. 12 was offered  by Representative Kubina:                         
                                                                               
Page 1, line 6, through page 4, line 31:                                       
	Delete all material and insert:                                               
	"(j)  The commissioner                                                   
		(1)  through June30, 1999,                                                
		(A)  may allow reduction of royalty on individual                          
leases, leases unitized as described in (p) of this section,                   
leases subject to an agreement described in (s) or (t) of this                 
section, or interests unitized under AS31.05                                   
		(i)  to allow for production from an oil or gas                           
field, pool, or portion of a field or pool if the oil or gas                   
field, pool, or portion of the field or pool has been                          
sufficiently delineated to the satisfaction of the                             
commissioner, the field, pool, or portion of the field or                      
pool has not previously produced oil or gas for sale,                          
and  oil or gas production from the field, pool, or                            
portion of the field or pool would not otherwise be                            
economically feasible;                                                       

1995-04-19                     House Journal                      Page 1380
HB 207                                                                       
		(ii)  to prolong the economic life of an oil or                         
gas field, pool, or portion of a field or pool as per                          
barrel or barrel equivalent costs increase or as the                           
price of oil or gas decreases, and the increase or                             
decrease is sufficient to make future production no                            
longer economically feasible; or                                               
		(iii)  to reestablish production of shut-in oil or                        
gas that would not otherwise be economically feasible;                         
		(B)  may not grant a reduction of royalty unless                           
the lessee or lessees requesting the reduction make a clear                    
and convincing showing that a reduction of royalty meets                       
the requirements of this subsection and is in the best                         
interests of the state;                                                        
		(C)  shall condition any royalty modification                              
granted under this subsection in any way necessary to                          
protect the state's best interests; the commissioner shall                     
provide for an increase or decrease or other modification                      
of the state's royalty share by a sliding scale royalty or                     
other mechanism that shall be based on a change  in the                        
price of oil or gas and may also be based on other relevant                    
factors such as a change in production rate, projected                         
ultimate recovery, development costs, and operating costs;                     
		(D)  may not grant a royalty reduction for a field,                        
pool, or portion of a field or pool                                            
		(i)  under (1)(A)(i) of this subsection that                              
exceeds 75 percent of the royalty originally specified in                      
a lease entered into under the provisions of (f) of this                       
section or AS38.05.134;                                                        
		(ii)  under (1)(A)(ii) or (1)(A)(iii) of this                             
subsection that exceeds 90 percent of the royalty                              
originally specified in a lease entered into under the                         
provisions of (f) of this section or AS38.05.134;                              
		(E)  shall require the lessee or lessees to submit,                        
with the application for the royalty reduction, financial                      
and technical data that demonstrates that the requirements                     
of this subsection are met; the commissioner                                   
		(i)  may require disclosure of only the financial                         
and technical data relating to production that is                              
reasonably available to the applicant; and                                     
		(ii)  shall keep the data confidential under                             
AS38.05.035(a)(9) upon the lessee's request;                                 

1995-04-19                     House Journal                      Page 1381
HB 207                                                                         
		(F)  may require the lessee or lessees making                             
application for the royalty reduction to retain and pay for                    
the services of a contractor, selected by the lessee or lessees                
from a list of qualified consultants in hydrocarbon                            
production and economics provided by the commissioner,                         
to assist the commissioner in evaluating the application                       
and financial and technical data; when the commissioner                        
requires the lessee or lessees to retain the services of a                     
contractor, the commissioner shall determine the relevant                      
scope of the work to be performed by the contractor;                           
		(G)  shall make and publish a preliminary findings                         
and determination on the royalty reduction application,                        
give reasonable public notice of the preliminary findings                      
and determination, and invite public comment to the                            
preliminary findings and determination during a 30-day                         
period for receipt of public comment;                                          
		(H)  shall make copies of the preliminary findings                         
and determination available to the presiding officer of each                   
house of the legislature, to the chairs of the legislature's                   
standing committees on resources, and to the chairs of the                     
legislature's special committees on oil and gas, if any;                       
		(I)  shall, within 30 days after the close of the                          
public comment period under (G) of this paragraph,                             
		(i)  prepare a summary of the public response                             
to the commissioner's preliminary findings and                                 
determination;                                                                 
		(ii)  make a final findings and determination;                            
the commissioner's final findings and determination                            
regarding royalty reduction is final and not appealable                        
to the court; and                                                              
		(iii)  with the applicant's consent, amend the                            
applicant's lease or unitization agreement consistent                          
with the commissioner's final decision;                                        
		(J)  shall                                                                 
		(i)  transmit a copy of the final findings and                            
determination to the lessee; and                                               
		(ii)  make copies of the final findings and                               
determination available to a person who submitted                              
comment under (G) of this paragraph and who has                                
filed a request for the copies;                                               
                                                                               

1995-04-19                     House Journal                      Page 1382
HB 207                                                                         
		(K)  is not limited by the provisions of                                  
AS38.05.134(3) or (f) of this section in the commissioner's                    
determination under this subsection; and                                       
		(2)  after June30, 1999, to [TO] prolong the economic                     
life of an oil and gas field or to reestablish commercial production           
of shut-in oil or gas that would not otherwise be economically                 
feasible,                                                                      
		(A)  [THE COMMISSIONER] shall adopt regulations                        
to allow reduction of royalty on leases;                                     
		(B) [. THE COMMISSIONER] may not grant a                                 
reduction of royalty unless the lessee requesting the reduction                
makes a clear showing that the revenue from the lessee's share                 
of all hydrocarbons produced from the field is and is likely to                
continue to be insufficient to produce a reasonable rate of                    
return with respect to the lessee's total investment in the field;           
		(C) [. THE COMMISSIONER] may condition a                                 
royalty reduction granted under this subsection in any way                     
necessary to protect the state's interest, including restoration               
of the state's royalty share in the event of an increase in the                
price of oil or gas; and                                                     
		(D)  shall, before [. BEFORE] approving a royalty                        
reduction, [THE COMMISSIONER SHALL] make a written                             
finding that the state has obtained the maximum possible                       
economic return that is compatible with allowing a reasonable                  
rate of economic return for the lessee, and send copies of the                 
finding to all members of the legislature."                                    
                                                                               
Representative Kubina moved and asked unanimous consent that                   
Amendment No. 12 be adopted.                                                   
                                                                               
Representative Rokeberg objected.                                              
                                                                               
The question being:  "Shall Amendment No. 12 be adopted?"  The roll            
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 12                                                               
                                                                               
YEAS:  6   NAYS:  31   EXCUSED:  3   ABSENT:  0                              
                                                                               

1995-04-19                     House Journal                      Page 1383
HB 207                                                                       
Yeas:  Brown, Davies, Finkelstein, Grussendorf, Kubina, Nicholia               
                                                                               
Nays:  Austerman, Barnes, Brice, Bunde, G.Davis, Elton, Foster,                
Green, Hanley, Ivan, James, Kelly, Kohring, Kott, Mackie, MacLean,             
Martin, Masek, Moses, Mulder, Ogan, Phillips, Porter, Robinson,                
Rokeberg, Sanders, Therriault, Toohey, Vezey, Williams, Willis                 
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
And so, Amendment No. 12 was not adopted.                                      
                                                                               
                                                                               
Amendment No. 13 was offered  by Representative Finkelstein:                    
                                                                               
Page 2, line 20:                                                               
Delete "and"                                                              
	Insert ","                                                                
                                                                               
Page 2, line 20, after "state":                                            
	Insert "and provides the state the maximum long-term                        
economic return"                                                             
                                                                               
                                                                               
Representative Finkelstein moved and asked unanimous consent that              
Amendment No. 13 be adopted.                                                   
                                                                               
Representative Green objected.                                                 
                                                                               
                                                                               
The question being:  "Shall Amendment No. 13 be adopted?"  The roll            
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 13                                                               
                                                                               
YEAS:  10   NAYS:  25   EXCUSED:  3   ABSENT:  2                             
                                                                               
Yeas:  Brown, Davies, Elton, Finkelstein, Grussendorf, Kubina,                 
Nicholia, Ogan, Robinson, Willis                                               
                                                                               

1995-04-19                     House Journal                      Page 1384
HB 207                                                                       
Nays:  Austerman, Barnes, Bunde, G.Davis, Foster, Green, Hanley,               
Ivan, James, Kelly, Kohring, Kott, Mackie, MacLean, Martin, Moses,             
Mulder, Phillips, Porter, Rokeberg, Sanders, Therriault, Toohey, Vezey,        
Williams                                                                       
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Brice, Masek                                                          
                                                                               
And so, Amendment No. 13 was not adopted.                                      
                                                                               
Amendment No. 14 was offered  by Representative Finkelstein:                    
                                                                               
Page 1, line 2, after "gas" (title amendment):                               
	Insert ", and to depositing royalties and royalty sale proceeds              
in the Alaska permanent fund"                                                 
                                                                               
Page 1, following line 4:                                                      
	Insert a new bill section to read:                                            
   "* Section 1.  AS37.13.010(a) is amended to read:                         
	(a)  Under art. IX, sec. 15 of the state constitution, there is              
established as a separate fund the Alaska permanent fund.  The                 
Alaska permanent fund consists of                                              
		(1)  25 percent of                                                          
		(A)  all mineral lease rentals, royalties, royalty sale                
proceeds, net profit shares under AS38.05.180(f) and (g), and                  
federal mineral revenue sharing payments received by the state                 
from mineral leases issued on or before December1, 1979,                       
except that, regarding royalties and royalty sale proceeds,                  
for leases for which the royalty is reduced or modified                        
under AS38.05.180(j), the permanent fund shall receive                         
the greater of                                                                 
		(i)  the royalties and royalty sale proceeds that                         
the fund would have received if a reduction under                              
AS38.05.180(j) had not been granted; or                                        
		(ii)  25 percent of the royalties and royalty sale                        
proceeds received by the state under a modified                                
royalty under AS38.05.180(j); and                                            
		(B)  [25 PERCENT OF] all bonuses received by the                       
state from mineral leases issued on or before February15,                      
1980;                                                                          

1995-04-19                     House Journal                      Page 1385
HB 207                                                                       
		(2)  50 percent of                                                          
		(A)  all mineral lease rentals, royalties, royalty sale                
proceeds, net profit shares under AS38.05.180(f) and (g), and                  
federal mineral revenue sharing payments received by the state                 
from mineral leases issued after December1, 1979, except                     
that, regarding royalties and royalty sale proceeds, for                       
leases for which the royalty is reduced or modified under                      
AS38.05.180(j), the permanent fund shall receive the                           
greater of                                                                     
		(i)  the royalties and royalty sale proceeds that                         
the fund would have received if a reduction under                              
AS38.05.180(j) had not been granted; or                                        
		(ii)  50 percent of the royalties and royalty sale                        
proceeds received by the state under a modified                                
royalty under AS38.05.180(j); and                                            
		(B)  [50 PERCENT OF] all bonuses received by the                       
state from mineral leases issued after February15, 1980;                       
		(3)  any other money appropriated to or otherwise                           
allocated by law to the Alaska permanent fund."                                
                                                                               
Page 1, line 5:                                                                
	Delete "Section 1."                                                         
	Insert "Sec. 2."                                                            
                                                                               
Renumber the following bill sections accordingly.                              
                                                                               
Page 3, lines 3 - 10:                                                          
	Delete all material and insert:                                               
		"(4)  may not grant a royalty reduction for a field,                      
pool, or portion of a field or pool under this subsection that                 
exceeds 75 percent of the royalty originally specified in a lease              
entered into under the provisions of (f) of this section on or                 
before December1, 1979, or 50 percent of the royalty                           
originally specified in a lease issued after December1, 1979,                  
under the provisions of (f) of this section or AS38.05.134;"                 
                                                                               
Representative Finkelstein moved and asked unanimous consent that              
Amendment No. 14 be adopted.                                                   
                                                                               
Representative Rokeberg objected.                                              
                                                                               

1995-04-19                     House Journal                      Page 1386
HB 207                                                                       
The question being:  "Shall Amendment No. 14 be adopted?"  The roll            
was taken with the following result:                                           
                                                                               
CSHB 207(FIN) am                                                               
Second Reading                                                                 
Amendment No. 14                                                               
                                                                               
YEAS:  10   NAYS:  26   EXCUSED:  3   ABSENT:  1                             
                                                                               
Yeas:  Brice, Brown, Finkelstein, Grussendorf, Kohring, Kubina,                
MacLean, Nicholia, Ogan, Robinson                                              
                                                                               
Nays:  Austerman, Barnes, Bunde, Davies, G.Davis, Elton, Foster,               
Green, Hanley, Ivan, James, Kelly, Kott, Mackie, Martin, Masek,                
Moses, Phillips, Porter, Rokeberg, Sanders, Therriault, Toohey, Vezey,         
Williams, Willis                                                               
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
Absent:  Mulder                                                                
                                                                               
And so, Amendment No. 14 was not adopted.                                      
                                                                               
                                                                               
Representative Vezey moved and asked unanimous consent that                    
CSHB207(FIN)am be considered engrossed, advanced to third                      
reading and placed on final passage.  There being no objection, it was         
so ordered.                                                                    
                                                                               
CSHB207(FIN)am was read the third time.                                        
                                                                               
                                                                               
The question being:  "Shall CSHB207(FIN)am pass the House?"  The               
roll was taken with the following result:                                      
                                                                               
CSHB 207(FIN) am                                                               
Third Reading                                                                  
Final Passage                                                                  
                                                                               
YEAS:  35   NAYS:  2   EXCUSED:  3   ABSENT:  0                              
                                                                               

1995-04-19                     House Journal                      Page 1387
HB 207                                                                       
Yeas:  Austerman, Barnes, Brice, Bunde, Davies, G.Davis, Elton,                
Foster, Green, Grussendorf, Hanley, Ivan, James, Kelly, Kohring, Kott,         
Kubina, Mackie, MacLean, Martin, Masek, Moses, Mulder, Nicholia,               
Ogan, Phillips, Porter, Robinson, Rokeberg, Sanders, Therriault,               
Toohey, Vezey, Williams, Willis                                                
                                                                               
Nays:  Brown, Finkelstein                                                      
                                                                               
Excused:  B.Davis, Navarre, Parnell                                            
                                                                               
And so, CSHB207(FIN)am passed the House.                                       
                                                                               
Representative Vezey moved and asked unanimous consent that the                
roll call on the passage of the bill be considered the roll call on the        
effective date clause.  There being no objection, it was so ordered.           
                                                                               
Representative Brown gave notice of reconsideration of her vote on             
CSHB207(FIN)am.