Legislature(2005 - 2006)SENATE FINANCE 532
05/06/2005 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB73 | |
| SB157 | |
| HB54 | |
| HB286 | |
| HB98 | |
| HB218 | |
| SB157 | |
| HB147 | |
| HB218 | |
| SB46 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 73 | TELECONFERENCED | |
| + | SB 74 | TELECONFERENCED | |
| + | HB 98 | TELECONFERENCED | |
| + | HB 147 | TELECONFERENCED | |
| + | HB 54 | TELECONFERENCED | |
| + | HB 286 | TELECONFERENCED | |
| + | HB 218 | TELECONFERENCED | |
| += | HB 275 | TELECONFERENCED | |
| = | SB 46 | ||
MINUTES
SENATE FINANCE COMMITTEE
May 6, 2005
9:55 a.m.
CALL TO ORDER
Co-Chair Green convened the meeting at approximately 9:55:42 AM.
PRESENT
Senator Lyda Green, Co-Chair
Senator Gary Wilken, Co-Chair
Senator Bert Stedman
Senator Lyman Hoffman
Senator Donny Olson
Senator Fred Dyson
Also Attending: REPRESENTATIVE RALPH SAMUELS; REPRESENTATIVE BILL
STOLTZE; RICHARD MANDSAGER, M.D., Director, Division of Public
Health Department of Health and Social Services; JANET CLARKE,
Assistant Commissioner, Division of Finance and Management
Services, Department of Health and Social Services; DEVEN MITCHELL,
Debt Manager, Department of Revenue, KATE GIARD, Chairman,
Regulatory Commission of Alaska, Department of Commerce, Community
and Economic Development; MARY JACKSON, Staff to Senator Tom
Wagoner and Aide to Senate Resources Committee; MIKE TIBBLES,
Deputy Commissioner, Department of Administration; IAN FISKE, Staff
to Representative Bill Thomas; LINDA HALL, Director, Division of
Insurance, Department of Commerce, Community and Economic
Development; ART CHANCE, Labor Relations Director, Division of
Labor Relations, Department of Administration; GINGER BLAISDELL,
Staff to Senator Green
Attending via Teleconference: From an Offnet Site: BRIAN
BJORKQUIST, Senior Assistant Attorney General, Labor and State
Affairs Section, Civil Division (Anchorage), Department of Law;
From Sitka: PETE ESQUIRO, General Manager, Northern Southeast
Regional Aquaculture Association
SUMMARY INFORMATION
SB 73-STATE VIROLOGY LABORATORY
The Committee heard from the Department of Health and Social
Services and the Department of Revenue. A committee substitute was
adopted and the bill reported from Committee.
SB 157-REG. COST CHARGES: UTILITIES/PIPELINES
The Committee heard from the Alaska Regulatory Commission and the
Department of Law. Two committee substitutes were subsequently
adopted, and the bill reported from Committee.
HB 54-BAIL REVIEW
The bill heard from the bill's sponsors and the bill was reported
from Committee.
HB 286-VALUE OF ROYALTY ON GAS PRODUCTION
The bill heard from the bill's sponsor and the Alaska Regulatory
Commission. The bill reported from Committee.
HB 98-NONUNION PUBLIC EMPLOYEE SALARY & BENEFIT
The Committee heard from the Department of Administration and held
the bill in Committee.
HB 218-PRIVATE HATCHERY COST RECOVERY FISHERIES
The Committee heard from the sponsor and the industry. The
Committee recommended that the bill be referred to the Senate
Resource Committee for further review.
HB 147-INSURANCE REGULATION
The Committee heard from Department of Commerce, Community and
Economic Development, adopted a committee substitute and reported
the bill from Committee.
SB 46-APPROP: CAPITAL BUDGET
The Committee adopted a committee substitute and reported the bill
from Committee.
HB 275-TRANSPORTATION PROJECT BONDS
This bill was scheduled but not heard.
SB 74-CRIMES INVOLVING MARIJUANA/OTHER DRUGS
This bill was scheduled but not heard.
CS FOR SENATE BILL NO. 73(HES)
"An Act relating to a lease-purchase agreement for the
construction, equipping, and financing of a state virology
laboratory in Fairbanks to be operated by the Department of
Health and Social Services; relating to the issuance of
certificates of participation for the laboratory; relating to
the use of certain investment income for certain construction
and equipment costs for the laboratory; and providing for an
effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Green noted that this legislation, which was proposed by
Governor Frank Murkowski, would further action on the virology
laboratory and its related certificates of participation. She asked
that an explanation of the term Certificates of Participation (COP)
be provided.
RICHARD MANDSAGER, M.D., Director, Division of Public Health,
Department of Health and Social Services, referred the Committee to
a handout titled "Public Health Protecting and Promoting the Health
of All Alaskans CSSB 73(HES): Construction of a State Public Health
Virology Laboratory in Fairbanks" [copy on file] and explained that
the term virology is defined as the study of viruses. This proposal
would be to construct a virology laboratory in Fairbanks in which
to identify common things such as influenza and measles. In
addition, research regarding uncommon viruses such as rabies and
hepatitis would also be conducted. The importance of having such an
"up-to-date" laboratory would be to allow the State to prepare for
new viruses that have been appearing elsewhere in the world such as
the Avian Flu, which is also referred to as the bird flu. This
virus, which is occurring in Southeast Asia, is being transmitted
from birds to humans and currently has a 70-percent mortality rate.
The worldwide public health field is concerned that this virus
might mutate and "become transmissionable human to human. This is a
very bad disease." The State must possess an advanced
identification ability that could be linked to an isolation and
quarantine process. It would be important to be able to identify
whether a person arriving via airplane from Southeast Asia who is
sick has the common flu or something worse.
Dr. Mandsager noted that the aforementioned handout also contains
pictures of the current Fairbanks virology laboratory. The people
who work there are handling "very bad viruses" as well as dealing
with such things as the release of "man-made things". The
laboratory facility must meet a basic laboratory three (BSL3)
level.
9:59:17 AM
Dr. Mandsager noted that there are 25 BSL3 labs, two BSL4 labs, and
one BSL 4+ lab currently operating in the United States. Although
the existing laboratory in Fairbanks operates at a level of a BSL
3, it does not meet the applicable standards. This legislation
would allow the State to meet those standards and be positioned for
the needs of the future.
Dr. Mandsager voiced that, while Fairbanks would be the preferred
location, as it would allow the laboratory to work in partnership
with the University and further their research missions, other
locations in the State would be acceptable. Having the facility in
Fairbanks would also provide a redundancy of services were a
disaster to strike the Anchorage area which hosts the State's
bacteriology and chemical-toxics laboratory.
JANET CLARKE, Assistant Commissioner, Division of Finance and
Management Services, Department of Health and Social Services,
deferred to Deven Mitchell of the Department of Revenue to explain
the Certificates of Participation (COP).
Co-Chair Green noted that the majority of the Committee Members
were familiar with this legislation due to media reports, other
reports, or participation in other committee hearings on the bill.
Co-Chair Green asked Mr. Mitchell to explain how the facility would
be financed.
DEVEN MITCHELL, Debt Manager, Department of Revenue, explained that
the proposed financing structure would entail there being COP,
"which would be facilitated by a lease that would be entered into
between the Department of Administration and a trustee bank that
would be given a title position". This "would facilitate the flow
of money from the State of Alaska to the bond purchasers." In
addition, this action would provide the mechanism allowing for
participation in the lease, hence the name Certificates of
Participation.
10:01:27 AM
Mr. Mitchell stated that the projected $24,200,000 expense would
include the cost of issuing the certificates. Debt service, at an
interest rate of 4.9 percent, would amount to an annual expense of
$2,400,000 for 15 years.
Mr. Mitchell noted that the 4.9 percent interest rate factored into
the financing calculation is above the current 4.2 percent interest
rate that would be available were the certificates issued today.
The sale of the certificates would be conducted in the fall of
2005. Construction would occur in the year 2006.
Mr. Mitchell addressed the Committee's "general" concern about how
such financial commitments might affect the State's AA credit
rating. Numerous discussions have occurred with rating analysts
about various funding options available to the State. Limiting the
number of general fund obligations undertaken by the State has been
considered in order to maintain that credit rating, prior to the
adoption of a long-term fiscal plan by the State. While the State
currently has "a positive budget position", no fiscal plan exists
for the next four or five year time period. The $24,200,000
obligation level has received positive feedback in that it "would
fall under the radar or within the buffer zone ? where we would be
issuing an obligation that wouldn't raise the eyebrows of the
rating analysts that track this State to the point that they would
be considering taking any credit action against the State." In
conclusion, this project would not impact the credit rating of the
State.
Co-Chair Wilken asked whether the "change of location" option that
would permit the laboratory to be constructed outside of the
University of Alaska Fairbanks campus is included in the Version
24-GS1117\F Committee Substitute.
Co-Chair Green affirmed that that option is included in the
committee substitute. She apologized for not previously mentioning
that component.
Co-Chair Wilken moved to adopt Committee Substitute, Version 24-
GS1117\F as the working document.
There being no objection, Version "F" was ADOPTED as the working
document.
Co-Chair Green commented that this bill would work in partnership
with a budget item included in the FY 06 capital budget bill.
10:05:25 AM
Co-Chair Wilken moved to report the bill from committee with
individual recommendations and accompanying fiscal notes.
There being no objection, CS SB 73(FIN) was REPORTED from Committee
with $10,000 fiscal note #1 dated January 19, 2005 from the
Department of Revenue; an FY 2010 fiscal need as reflected in
fiscal note #2 dated January 20, 2005 from the Division of Public
Health, Department of Health and Social Services; and a new zero
fiscal note dated May 6, 2005 from Administrative Support Services,
Department of Health and Social Services.
AT EASE 10:05:41 AM / 10:06:17 AM
SENATE BILL NO. 157
"An Act relating to the maximum annual regulatory cost charge
collected from certain regulated public utilities and pipeline
carriers; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Green noted that this legislation, which was requested by
Governor Frank Murkowski, would relate "to an Act pertaining to the
maximum annual regulatory cost charge collected from certain
regulated public utilities."
Co-Chair Wilken moved to adopt committee substitute Version 24-
GS1138\F as the working document.
There no objection, Version "F" was ADOPTED as the working draft.
10:07:02 AM
KATE GIARD, Chairman, Regulatory Commission of Alaska (RCA),
Department of Commerce, Community and Economic Development, spoke
to the Regulatory Commission and the reason for the development of
this bill. When she became an RCA commissioner in June 2003, she
had understood "that there were a lot of challenges that the
public, the utilities, and the Legislature had with the overall
functionality" of the Commission. She was elected chair of the
Commission in July 2004, on a platform focusing on addressing those
issues. Since that time, she had held discussions with public
utilities, pipeline companies, and Legislators to determine "the
issues that were driving some of" those entities' major concerns
about the RCA.
Ms. Giard stated that "the overall goal was to identify and form
working groups to work together to address" those concerns before
hearings on whether to terminate or continue the Commission
occurred in two years' time. The effort would be considered
"successful" were the forthcoming hearings to not include the
"plethora of issues" that such hearings have had in the past.
"Strategies and plans" have been formulated in this regard,
including the Regulatory Cost Charge (RCC) rate increase proposal
contained in this legislation. Other efforts would include
addressing regulations and encouraging public comments on RCA
activities. These processes would continue over the next two years.
10:09:40 AM
Ms. Giard explained that this legislation would increase the RCC
rate "by two-tenths of one-percent, from seven to nine for a three
year period." This would provide funding through which the RCA
could acquire new systems to improve the efficiently of RCA
operations. RCA has not, to this point, invested in such systems
and is lagging behind current data processing trends. This has
prevented the RCA from completing its workload. To this point, she
noted that, due to a lack of systems and reporting capabilities,
she, as chairman, is uninformed about "the day-to-day activities"
of RCA staff. "That translates to you hearing that we're not
getting our orders out promptly, that utilities don't know where
things are in the process, and that it takes an extremely long time
to get an order and answer from the RCA."
Ms. Giard stated that the Legislature has heard from many utilities
in regard "to the many challenges" they have experienced in getting
information from the RCA. Such issues are not insurmountable; the
RCA is capable of providing the information, and the implementation
of updated systems would assist this effort.
10:11:09 AM
Ms. Giard stated that discussions with utilities in regards to this
RCC funding mechanism have transpired. To alleviate their initial
"discomfort" with the idea, the utilities asked that an advisory
group be developed. Thus an advisory group, comprised of utilities,
was formed in January 2005. That group reviewed the RCA strategy
and helped formulate a plan. As a result, the utilities have become
more comfortable that RCA would update their system to deliver the
services that the utilities require, including the system ability
that would allow the utilities to transmit data to the RCA
electronically. One utility, Chugach Electric, had to manually
provide 65,000 documents pertaining to a recent rate case to the
RCA. This RCC rate increase would serve to address these issues.
Ms. Giard explained that, as specified in State Statute, the RCC
monies that are collected are deposited into the RCA's operating
fund rather than its capital fund. RCC fees are collected from the
utilities and the pipeline companies who collect them from their
ratepayers. Were RCA to not spend the entirety of the fees
collected in a given year, this practice would allow that balance
to be reflected in the operating budget. That balance would serve
to reduce the amount of RCC fees that the ratepayers would pay the
following year. In contrast, depositing the fees into the RCA
capital fund account would not have "that impact on the ratepayer".
Thus, any money remaining after the purchase of the new systems
would serve to reduce the RCC rate the following year. The money
would not be used to hire additional staff or other expenses.
Ms. Giard noted that the advisory group would continue to meet with
the RCA until the system upgrade concluded.
Ms. Giard concluded by commenting that she would welcome Committee
questions about the RCA or the bill.
10:13:45 AM
Co-Chair Green voiced appreciation for Ms. Giard's testimony.
Ms. Giard pointed out, for the record, the fact that typically RCA
legislation is a point of controversy. This legislation is contrary
to the norm as the efforts in its regard were conducted in
cooperation with the utilities. "We owe any success that results
from this venture to those pipeline companies and utilities that
did participate and that did respectfully say we support this and
we are going to not move forward and take any advantage of this
situation."
Ms. Giard voiced her support of an [unspecified] amendment that was
developed during the process as she deemed it as being "good public
policy". It did not "have the Christmas tree affect" that could
have happened. She voiced appreciation for the efforts exerted by
the Legislature, the pipeline companies, and the utilities.
10:15:37 AM
Co-Chair Green commented that when she initially heard about this
legislation, she thought that this "was just another method by
which our ratepayers" would pay more to the utilities who would
"pay more for something". However, the volume of documents that the
RCA process entails is expansive and the fact that it is currently
conducted manually is unacceptable in today's work environment. In
addition the RCA is currently unable to change and edit as the
process unfolds. She voiced her support of this legislation, as it
would serve to update the process.
Co-Chair Wilken opined that the title change included in Version
"F" appears to be the result of language included in Sec. 3, page
two, lines 15 through 22. That language would "appear to indemnify
public utilities for damages that may or may not have been caused
by operating a transmission line."
10:17:02 AM
Co-Chair Wilken asked whether Ms. Giard was familiar with the
language in Sec. 3 regarding "the prohibition on the ability of the
Regulatory Commission of Alaska to order electric utilities to
operate their systems different than design or safety standards and
relieving the utility of liability in order to operate in such a
manner."
Ms. Giard asked for further clarification of the question.
Co-Chair Wilken stated that his question was to whether she was
"familiar with Sec. 3."
Ms. Giard replied that she was familiar with the section.
Co-Chair Wilken then asked whether it was her "understanding that
the amendment is directed at the manner in which RCA is requiring
that the 20-mile segment of the transmission line that is owned and
operated by Matanuska Electric Association" [MEA].
10:17:42 AM
Ms. Giard replied in the affirmative.
Co-Chair Wilken asked whether "the line at issue" is "used as part
of the Alaska intertie which is the major transmission line between
Anchorage utilities and the northern interior of the State."
10:17:56 AM
Ms. Giard affirmed that it was.
Co-Chair Wilken asked how long that line has been in operation.
Ms. Giard responded that that line has been in operation for
approximately 20 years.
Co-Chair Wilken asked whether the RCA had conducted hearings in
regards to "the manner involving the manner in which MEA was
intending to operate that line."
Ms. Giard affirmed that hearings were held in that regard.
Co-Chair Wilken asked who had participated in those hearings.
Ms. Giard stated that RCA had issued Order #4, Docket No. U-03-100
[copy not provided] in this regard. The parties involved in that
proceeding were the Chugach Electric Association, Inc.(CEA); Golden
Valley Electric Association, Inc. (GVEA); the Municipality of
Anchorage d/b/a Municipal Light and Power [MLP], the City of
Seward, and MEA.
Co-Chair Wilken asked whether "experts" attended that hearing.
Ms. Giard responded yes; it is the norm that experts "on both
sides" attend such hearings.
Co-Chair Wilken asked whether "the designer of that line
testified."
Ms. Giard stated that, "as this particular order has been appealed
to the Superior Court", it would be difficult to delve into the
details of that hearing. However, she would be able to discuss Sec.
3 and provide its historical background.
10:19:14 AM
Ms. Giard informed the Committee that the original Senate and House
of Representatives companion bills that had been introduced this
session had simply focused on the RCC. Recently, however, MEA
raised concerns about the aforementioned order issued by the RCA.
"MEA had proposed initially that they would like this order to be
overturned. That is a public policy issue, which the RCA could not
support." One of the primary concerns raised by MEA pertained to
the RCA interconnection order that utilizes approximately 20 to 26
miles of MEA lines, called TLS lines. Those 20 miles of MEA's TLS
lines have been under contract for the intertie transmittal during
the 20 years since the inception of the intertie, as, since
"funding was low", utilizing the MEA TLS line was deemed to be the
most efficient transmittal option.
Ms. Giard continued that MEA indicated that they "would no longer
be able to offer that service to the intertie because they weren't
able to negotiate terms and conditions MEA was comfortable with."
RCA conducted a hearing "and issued an Order stating and requiring
MEA to interconnect." A copy of the Order could be provided.
10:20:57 AM
Ms. Giard noted that MEA had raised safety concerns about the line,
due to RCA ordering that MEA "connect the line and run the transmit
kilowatts at 138." The line was originally designed for 115
kilowatts (KV). During her recent conversations "with MEA about
their concerns and their desire to have the Order overturned within
the Legislative process," she explained that that would be "bad
public policy because there is a mechanism the Legislature put in
place for MEA or any public utility or pipeline to deal with orders
that they do not like that are issued from the RCA." That process
would entail appealing the RCA decision to the Superior Court and
then to the Supreme Court. The Courts would decide whether or not
RCA had "done our job well."
Ms. Giard stated that MEA understood the public policy issue
concerns and chose not "to violate them." The underlying MEA
concern was in regards to "their liability". They have provided
their service to the State of Alaska, however, were someone to be
injured with that line being run at a 138-kilowatt voltage "the
utility stands in place of the intertie. The State of Alaska stands
in place for the rest of the intertie through the" Alaska Energy
Authority (AEA).
Ms. Giard communicated that it would be deemed good public policy,
and policy that should have been enacted 20 years earlier when the
MEA line was originally used for the intertie, "that if this line
does cause liability while it is being used as intertie, and there
is some discussion underway that it would only be used for the next
three to five years under this mechanism, that it is good public
policy that this public utility not be held more accountable or
more liable than other utilities along the Railbelt." It was then
necessary to communicate this public policy to the other utilities
connecting to that intertie including GVEA, CEA, and MLP.
Ms. Giard continued that in a matter of the last 48 hours, this
information had been conveyed to the other utilities. She agreed
with the other utilities that this issue would have been better
served had MEA presented their concern earlier. However, she
understood MEA's position that, since the Order had been under
appeal to the Superior Court, it would have been inappropriate to
address it earlier. This is a fair account of what has transpired
in last 48 hours. RCA and the Office of the Governor have
determined that the language changes included in Sec. 3 of Version
"F" would be acceptable.
10:25:04 AM
Co-Chair Green asked whether the Department of Law and RCA
attorneys had been involved in the discussions, specifically
whether those entities deemed the Sec. 3 language as being
"workable".
10:25:24 AM
Ms. Giard assured that the Attorney Generals Office, AEA's legal
representative, the Department of Law, and the Legislative Legal &
Research Division were involved in the recent discussions. It has
undergone the appropriate review.
10:25:58 AM
Co-Chair Wilken concluded therefore that the language in the bill
would serve as "an end run around the RCA decision" and "would
indemnify a certain utility for their future actions in regards to
operating this asset." To that point, he asked for confirmation
that neither RCA nor Governor Frank Murkowski had any concerns in
regards to the language contained in Sec. 3 and were, in fact,
"supportive of it."
Ms. Giard expressed that she had "strongly and sternly spoken to
MEA about the 'end run' issue." To that point, she viewed end runs
as not being "uncommon. It is probably a normal part of a process
that" she "was not particularly familiar with". She stated that she
focuses on the end result: "is the end result good public policy
that the Governors Office stood behind". The determination that
this was good public policy was the conclusion reached at the end
of the past 48 hours. She would be unable to recommend that the
Committee advance this action otherwise.
Co-Chair Wilken acknowledged.
Senator Dyson voiced having "a different perspective on this; it
may indeed be 'an end run' in a way that I don't perceive."
10:28:15 AM
Co-Chair Green interrupted Senator Dyson's comments to note that
the Committee, in its questioning, should be conscious of
restrictions that might be placed on Ms. Giard and RCA due to the
pending Superior Court decision.
Senator Dyson spoke in regards to the fact that RCA was asking MEA
to transmit 138 KV on a line designed to transmit 115 KV. RCA had
determined that the line was capable of handling the increased
voltage. The owner of the line viewed it as being marginal; "it is
not the recommendation of the national electric safety code." He
understood "that that section of line has had a considerable number
of outages." Therefore, it would not be unreasonable in a case
where a governmental agency "forced" an entity "to operate on the
edges of good national standards" ? "for that group to say hey over
our protest, you are asking us to do something that's outside of
what would be normal recommended practice, and we want to be held
harmless if we do what we are ordered to do that outside of
national recognized standards". In conclusion, he viewed the
language in Sec. 3 as offering "reasonable protection for this
utility".
Senator Dyson informed the Committee that his background included
working as a construction lineman and in electric power
maintenance. He noted that arching between lines and insulators is
an issue dependent "on atmospheric conditions." He "suspected" that
while the line in question is located in an area that is relatively
dry, "moisture in and around the dew point" could cause problems.
This, combined with other factors such as line age and wind, could
be troublesome.
10:30:50 AM
Senator Olson voiced being uncomfortable with the fact that RCA is
requesting that a line exceed its capabilities. He compared this to
an airplane directed to fly with a load exceeding its specific
design weight. While the aircraft might be designed with margins on
its load, being directed to do so might result in the eventual
failure of the aircraft. This might be the situation that is
causing the power outages on that line.
Senator Olson noted that he had some familiarity with power lines
as his father had operated a small community's generator. To that
point, he understood that there were methods, such as the
installation of transformers, through which the voltage of a line
could be increased within the parameters of the designed voltage.
10:32:14 AM
Ms. Giard stated that those issues were discussed at the hearing
and with MEA. Like the Legislature, the RCA has the ability "to
hear a complete record" of an issue "and weigh and balance and
decide" in its regard. Some decisions could be "really good" and
others could be "really bad", and the process that would allow RCA
decisions to be heard by the Superior Court would be the
determining factor in regards to this RCA decision. MEA is aware of
this process and the other parties understand that there are
"mitigating circumstances". All these factors were weighed in the
RCA decision.
Ms. Giard displayed a thick binder containing the transcripts of
the hearing proceeding. The Superior Court would decide whether the
RCA decision in this issue was right or wrong.
Co-Chair Green asked for confirmation that the other public
utilities had been included in the discussions.
Ms. Giard affirmed that she and the Governor's Office have actively
communicated with the other entities. She shared the understanding
that those entities also viewed the language in Sec. 3 as good
public policy, "but were disenchanted with the process". The focus
should be on the fact that the legislation being offered today "is
good for the State of Alaska."
10:34:40 AM
BRIAN BJORKQUIST, Senior Assistant Attorney General, Labor and
State Affairs Section, Civil Division (Anchorage), Department of
Law testified via teleconference from an offnet site and noted that
he had just reviewed Version "F". However, the language in Version
"F" is missing the intended intent, which was "to limit the
immunity from liability to the extent that the damage was caused by
the operation of the line either inconsistent with its original
design standards or in a manner that was a violation or
inconsistent with the national safety code." As written, Version
"F" would "provide complete immunity to the utility for any damage
that might be caused by the operation of the utility or the
transmission line regardless of whether it would have anything to
do with the difference or the inconsistency with the design
standard or the national electric safety code."
Mr. Bjorkquist stated that this would be a concern.
10:36:01 AM
Senator Dyson asked Mr. Bjorkquist for a recommendation in this
regard.
Mr. Bjorkquist stated that he would work on developing the
appropriate language. "The basic concept is that the public utility
would not be liable for any damages caused to the extent that the
damage was caused by the operation of the transmission line at a
voltage that is inconsistent with either the original design
standards or the national safety code; and also that the Regulatory
Commission of Alaska would be ordering that."
10:37:09 AM
Senator Dyson deferred to Mr. Bjorkquist's judgment even though
Senator Dyson thought that the concern was sufficiently addressed
in Sec. 3.
10:37:28 AM
Co-Chair Green asked that RCA confer with Mr. Bjorkquist and the
Administration in this regard.
Ms. Giard concurred. The issue would be readdressed and be brought
back to the Committee.
Co-Chair Green ordered the bill HELD in Committee.
[NOTE: This legislation is readdressed at Time Stamp 4:37:15 PM.]
10:38:06 AM
CS FOR HOUSE BILL NO. 54(FIN)
"An Act relating to bail review; relating to petitions for
review by crime victims where the defendant has received a
sentence below the sentencing range for the crime; relating to
the qualifications of certain members of the Violent Crimes
Compensation Board; relating to the introduction of the victim
and the defendant or minor to the jury; amending Rule 27,
Alaska Rules of Criminal Procedures, and Rule 21, Alaska
Delinquency Rules; and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
REPRESENTATIVE RALPH SAMUELS, co-sponsor of the bill, informed the
Committee that the first part of this bill would address bail
hearings. The fact that a defendant is currently entitled to a bail
hearing every 24 hours creates problems for both district attorneys
and for the crime victim who "have a Constitutional right to be a
every proceeding that the defendant is at". The 24-hour bail
scenario is a hardship for the victim who, when notified of the
hearing, might be required to leave their job to attend a hearing
which might not occur. This process could occur day after day with
the end result being the bail not being changed.
Representative Samuels stated that this bill would change the bail
hearing timeframe to a 48-hour timeframe, and, in order to request
a new bail hearing something pertaining to the case must have
changed. That new information must be submitted "in writing for the
Court's consideration". It must be new information that had not
been considered at the prior bail hearing. The District Attorney
would be provided a 48-hour timeframe in which to notify the
victim, and there must be 48 hours between bail hearings.
10:39:24 AM
Representative Samuels continued that the second part of the bill
would clarify that the victim could "be introduced to the jury
during the opening statement or during the jury selection process".
Since the defendant is introduced to the jury, both he and co-
sponsor Representative Bill Stoltze deem the introduction of the
victim of the crime to be warranted. It would "put a face on what
happened whether it be a crime against a person or a simple
property crime."
10:39:59 AM
Representative Samuels communicated that the third component of the
bill would provide the victim "the right to petition a review of a
sentence that falls below the set range". He referenced previously
adopted legislation that specified a range of sentencing for
specific crimes. While "a sentence that goes above the range would
go to a jury trial", this bill would allow that "the victim of a
crime could petition a review of the sentence ?.to the Court of
Appeals" were "the aggregate amount of years between all the
aggravators and mitigators in a sentence" to fall below the range.
Representative Samuels stated that the bill would also expand State
Statutes to allow a retired physician or attorney to qualify for
the Violent Crimes Compensation Board.
Representative Samuels concluded that these steps would assist in
balancing the rights of the accused and those of the victim.
Co-Chair Green observed that allowing a retired physician or
attorney to serve on the Board would serve "to increase the
eligibility" of Board members.
REPRESENTATIVE BILL STOLTZE, the bill's co-sponsor, thanked the
Committee for hearing this bill.
10:41:41 AM
Co-Chair Green declared that, according to the volume of phone
calls she has received in regards to this bill, it must be a "very
good bill".
Co-Chair Green asked whether does bill would "bar or impact a
defendant's ability to file an expedited request".
Representative Samuels responded that it would not. Under the
current process, a Magistrate would set a defendant's initial bail.
Typically, and particularly in cases involving "high emotions or
alcohol, that bail would be set at a high level. The subsequent
bail hearing, which is considered "the real bail hearing" would be
before a Judge. Rather than allowing a bail hearing to be scheduled
every day, as is currently the case, this bill would extend the
amount of time between hearings and would require that a change in
the information pertaining to the case be provided in writing to
the Court.
Co-Chair Wilken moved to report the bill from Committee with
individual recommendations and accompanying fiscal notes.
There being no objection, CS HB 54(FIN) was REPORTED from Committee
with zero fiscal note #1 dated March 26, 2005 from the Department
of Corrections; zero fiscal note #2 dated March 24, 2005 from the
Alaska Court System; and zero fiscal note #3 dated March 29, 2005
from the Department of Law.
10:43:13 AM
SENATE CS FOR HOUSE BILL NO. 286(RES)
"An Act amending the manner of determining the royalty
received by the state on gas production by directing the
commissioner of natural resources to accept, under certain
circumstances, the transfer price of the gas if established by
transfer price order of the Regulatory Commission of Alaska;
extending and amending the requirements applicable to the
credit that may be claimed for certain oil and gas exploration
expenses incurred in Cook Inlet against oil and gas properties
production (severance) taxes, and amending the credit against
those taxes for certain exploration expenditures from leases
or properties in the state; and providing for an effective
date."
This was the first hearing for this bill in the Senate Finance
Committee.
REPRESENTATIVE RALPH SAMUELS, the bill's sponsor, informed the
Committee that one component of this bill would address an issue
brought forward by Anchorage Municipal Light and Power (ML&P). That
issue involves how the Department of Natural Resources (DNR) would
value ML&P gas royalty prices. Currently, DNR would establish the
royalty price based upon "the value of a contract that Shell had at
the Beluga River Field with Municipal Light and Power. Municipal
Light & Power then bought Shell's interest in the field itself. DNR
agreed to use the contract price until the contract expired. The
contract expires in 2005 and the language in the bill would allow
DNR to use the transfer price now since there is no longer a sale
going on they own the gas in the field. They are transferring it to
themselves. The transfer price is set by" the Regulatory Commission
of Alaska (RCA). He noted that RCA has voiced its support for this
legislation.
Co-Chair Green understood that the bill's sponsor would appreciate
testimony being presented by the RCA in regards to Section 1, which
is the section that pertains to ML&P.
Representative Samuels affirmed.
10:45:28 AM
MARY JACKSON, Staff to Senator Tom Wagoner and Aide to the Senate
Resources Committee, stated that her comments would address
Sections 2 through 9 of the Senate Resources (RES) Committee
committee substitute before the Committee. The RES Committee
decided to include in this bill the Exploration Incentives Credit
program that originated in HB 71. That bill would, at this time,
remain "in the possession of the Senate Resources Committee".
Ms. Jackson continued that this bill therefore would extend to
Bristol Bay and other areas such as the Healy, Red Dog, and Nenana
Basin, the incentive credits that were initially developed for the
Alaska Peninsula. A different set of incentives, mirroring those
specified in SB 163, would apply to Cook Inlet.
10:46:53 AM
Co-Chair Green ascertained therefore that the provisions included
in this bill are "all recent" events.
Ms. Jackson affirmed. Therefore, this bill would establish a new
set of exploration credits, modeled after the exploration credit
program authorized in the year 2003 in SB 185. She remarked that
the Senate Finance Committee at that time was the first to conduct
hearings on that credit program too.
Ms. Jackson noted that this bill would extend the exploration
credits program to all areas of the State "south of the Brooks
Range". Specific standards and rules for the exploration credit
program would apply to the Cook Inlet Basin because that area "is a
more mature basin." The Senate Resources Committee also altered two
other provisions that were included in the original version of HB
286: they "eliminated the clause that eliminated" the Arctic
National Wildlife Refuge (ANWR). While ANWR had been included in SB
185 in the year 2003, it had been eliminated from the exploration
credit program included in the original version of this bill. The
RES Committee also addressed "some concern" in regards to the
regulation timeline that had been written in regards to SB 185. As
a result, a new set of regulations would be implemented after the
regulations enacted by SB 185 expire in 2007.
Ms. Jackson informed the Committee that there has been a
substantial amount of support for all areas of this legislation
throughout its development.
Co-Chair Green asked whether the Legislature might receive negative
feedback and be accused of "giving away the farm" were it to adopt
this bill.
Ms. Jackson responded that such feedback would be unlikely. The
purpose of the legislation would be "to put some oil in the
pipeline".
Co-Chair Green agreed that an increase in oil production is
"absolutely needed" to refill the pipeline.
Co-Chair Green asked Kate Giard of the Regulatory Commission of
Alaska to comment in regards to the inclusion of the ML&P transfer
price specified in Section 1 of the bill.
KATE GIARD, Chairman, Regulatory Commission of Alaska, Department
of Commerce, Community and Economic Development, shared that due to
the fact that ML&P is a regulated utility, RCA had reviewed the
issue and via an [unspecified] RCA order had conveyed the
methodology that would be acceptable to the RCA in regards to the
transfer price. RCA "has fully vetted" the calculation mechanism
regarding ML&P's transfer price and is "comfortable with this
legislation."
10:50:08 AM
Ms. Giard specified that ML&P would file, on an annual basis, the
transfer price calculation. RCA would review that information and,
were a question or concern to arise, a 30-day comment period would
be established in which people could comment in regards to the
transfer price. In addition, were the Attorney General
"representing the public advocate" concerned about the calculation,
he or she would intervene in the process. This would allow the
public to have an opportunity to get involved in process involving
the calculation of the transfer price. She assured that a process
was in place, the transfer price would be calculated, and the
Department of Natural Resources should not experience any problems
with it. In summary, RCA "fully supports" the legislation.
Senator Dyson noted, for the record, that he had been a member of
the Municipality of Anchorage Assembly during the time that the
original transfer price negotiations had been conducted, and as
such had played a significant but strictly public process role in
the endeavor.
Senator Olson questioned the reason that a specific latitude is
identified in Sec. 3, page three line 23 of the bill. The area in
question is in his election district.
10:51:57 AM
Ms. Jackson responded that the original tax that became effective
with the 2003 legislation is in place in regards to this area. The
language in questions would allow the existing tax codes to be
extended out to the year 2010 for areas south of the identified
latitude.
Senator Olson asked for confirmation that the tax codes are
currently in place.
Ms. Jackson affirmed. The 2003 legislation had established a four-
year incentive program that would be in effect from 2003 to 2007.
ANWR was included in this legislation in order to allow exploration
in that area to qualify. She understood there to be one entity that
is considering conducting seismic studies there.
In response to a question from Co-Chair Green, Ms. Jackson stated
that the new credits provided in this bill would apply to areas
"south of the Brooks Range".
Co-Chair Wilken moved to report the bill from Committee with
individual recommendations and accompanying fiscal notes.
There being no objection, SCS HB 286(RES), accompanied by Senate
Concurrent Resolution #16, was REPORTED from Committee with zero
fiscal note #2 dated May 5, 2005 from the Department of Natural
Resources; indeterminate fiscal note #3 dated May 5, 2005 from the
Department of Revenue; and zero fiscal note #4 dated May 5, 2005
from the Department of Commerce, Community and Economic
Development.
10:53:21 AM 10:54:27 AM
CS FOR HOUSE BILL NO. 98(RLS)
"An Act relating to the compensation of the governor, the
lieutenant governor, and certain public officials, officers,
and employees not covered by collective bargaining agreements;
and providing for an effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
Co-Chair Green informed the Committee that revised language for
this legislation is being developed.
10:55:01 AM
MIKE TIBBLES, Deputy Commissioner, Department of Administration,
noted that he had previously testified before the Committee in
regards to this bill's Senate companion bill. This bill would align
the Statutory pay schedule for partially exempt and exempt
employees in the Legislative, Judicial, and Executive branches of
State government to the pay schedules negotiated with the
supervisory bargaining unit. The House of Representatives added an
amendment that would increase the salary of the Governor and the
Lieutenant Governor with an effective date of December 2006. A new
Administration would be seated by that date. The House also added
an amendment that would increase the salary of commissioners from a
28E range "to a range of not less than 28 and not greater than 30".
Co-Chair Green noted that the effective date pertaining to the
Commission salaries would be July 2005.
Mr. Tibbles affirmed.
Co-Chair Green asked the affect of not advancing this legislation;
specifically how the salaries of the affected employees would
relate to their government agency counterparts in organized labor
represented positions.
Mr. Tibbles noted that the affected employees' statutory schedule
is approximately five-percent less than that of supervisory and
collective bargaining unit employees. This bill would align the
affected employees' salaries with those; therefore, all employees
at, for example, a range 21 position, would be paid the same. This
issue is important due to the equity issue, as there is a statutory
mandate that requires employees to be paid the same for like work.
In addition, this legislation would also assist in recruitment and
retention of long-term experienced and valuable employees. Absent
this legislation, a nine-percent disparity would be occurring
between the statutory schedule and the union contract schedule.
Such a "large disparity" would make it difficult to recruit. It
might also discourage people from moving into supervisory positions
as they might make less money by moving up.
Co-Chair Green noted that the current five-percent salary
difference would increase to approximately a nine-percent as the
result of upcoming negotiated bargaining unit increases. That nine-
percent difference is "substantial" and has been a factor in the
loss of valuable employees.
Co-Chair Green stated that the bill would be HELD in Committee in
anticipation of a forthcoming amendment.
10:59:59 AM
CS FOR HOUSE BILL NO. 218(FIN)
"An Act relating to cost recovery fisheries for private
nonprofit hatchery facilities."
11:00:10 AM
This was the first hearing for this bill in the Senate Finance
Committee.
IAN FISK, Staff to Representative Bill Thomas, stated that this
bill would address the method through which private non-profit
hatcheries in the State recover their operational expenses.
Representative Thomas, who was instrumental in the development of a
hatchery in Juneau, has been a long time supporter of the hatchery
system. Historically, these hatcheries have contracted with a
single processor and typically "only a couple of vessels actually
harvest" the fish. This operation typically would occur in the area
in front of the hatchery. "The rate of the total run that is
actually harvested by hatcheries varies greatly around the State."
The alternate cost recovery method being proposed in this
legislation would allow a hatchery to elect to have a variable rate
assessment imposed on fishermen were it "to open up their process".
He emphasized that the proposal would be optional; a hatchery could
impose it were it deemed to be in their best interest.
Mr. Fisk stated that were a hatchery to elect to implement this
proposal, it would "work with representatives of the commercial
fishing fleets to develop a process by which they could do this."
11:01:54 AM
Senator Stedman asked whether there is "unanimous support" for this
proposal.
11:02:03 AM
Mr. Fisk voiced that fishermen's support for this bill would be
"about as close to unanimous support as you would get on any
fishing industry bill." The lone opposition that has been received
to this bill has been from the Board of the Northern Southeast
Regional Aquacultural Association (NSRAA). He noted that "some
findings" language was removed from the bill is response to some
concerns that had been raised by the Valdez Hatchery.
Senator Stedman understood that the impetus behind this bill was
the cost recovery needs of the Hidden Falls Hatchery.
Mr. Fisk affirmed. The Hidden Falls Hatchery, which is a member of
NSRAA, "is one of the most successful hatchery programs in the
State". It was anticipated that that hatchery would be one of the
first that would elect to impose the cost recovery option being
proposed in this bill because "they actually don't take that much
for their cost recovery." In other words, because they had paid
their debt down, they were in a better position to take this risk
than other hatcheries. The risk involved would be that this
hatchery would allow "their cost recovery to be collected through
an assessment and not by simply hiring a couple of boats."
Senator Stedman ascertained therefore that the Hidden Falls
Hatchery is in support of this legislation.
Mr. Fisk clarified that the Hidden Falls Hatchery is not in support
of this bill.
Mr. Fisk stated that substantial effort was made to work with the
director of NSRAA throughout the development of this bill. Numerous
changes were made in response to his suggestions, including the
adjustment of the ceiling on the rate and the removal of certain
findings. The process "is indicative of the general lay of the land
here in this hatchery cost recovery issue. That even if we were
presenting them with an option, I think part of the concern is that
they are afraid that it's not going to be optional in the long run"
as something would change that would make this a mandatory bill. He
assured "that that is absolutely not the intent."
Co-Chair Green intoned being unfamiliar with fisheries issues.
Continuing, she voiced concern as to whether additional legislation
might occur that could evolve this relatively "benign" program to
becoming more active or "be the start of something bad or
different."
11:05:42 AM
Mr. Fisk characterized this legislation as being "the start of
something good." It would be "the first step" in providing
fishermen the ability "to access more fish". "Hatcheries were
created during times of low abundance to enhance our runs of fish
for the benefit of the common property users." There was no intent
for the hatchery to be the primary harvesters of the fish. However,
as the result of the need to recover costs, the Department of Fish
and Game allowed hatcheries "to harvest fish under the current
method". This legislation would widen Statute to include this
optional cost recovery method. It would not be deemed proper to
require this method to be implemented due to the fact that
hatcheries "have different financial situations and different
species of fish".
11:06:44 AM
Senator Stedman recognized that fact that numerous fishermen, and
probably fish processors, support the concept being proposed in
this legislation. However, it should be noted that NSRAA does not
support the legislation. To that point, he asked for further
information regarding the makeup of the NSRAA Board.
11:07:31 AM
Co-Chair Green interjected to say that, due to time constraints,
the bill would be HELD in Committee. Further discussion of the bill
would occur when the Committee reconvened.
[NOTE: This bill was readdressed later in the meeting. See Time
Stamp 4:46:24 PM.]
RECESS TO CALL OF THE CHAIR: 11:08:15 AM / 4:37:15 PM
SENATE BILL NO. 157
"An Act relating to the maximum annual regulatory cost charge
collected from certain regulated public utilities and pipeline
carriers; and providing for an effective date."
This bill was again before the Committee.
Co-Chair Green stated that the questions that had been brought
forward earlier by the Attorney Generals Office in regards to Sec.
3 of Version "F" would be addressed.
Senator Stedman moved to adopt committee substitute Version 24-
GS1138\Y as the working document.
Co-Chair Green objected for explanation.
4:38:24 PM
BRIAN BJORKQUIST, Senior Assistant Attorney General, Labor and
State Affairs Section, Civil Division (Anchorage), Department of
Law testified via teleconference from an offnet site and noted that
language has been revised in Sec. 3, page two, lines 14 through 22,
in order to clarify the limitation on liability for the owner of
the transmission line. The intent of this language would be to
specify that the transmission line owner "would not be liable to
the extent of the damage caused by the operation of that voltage
that exceeds the original design standards or if the voltage
violates the applicable standards of the national electric safety
code".
KATE GIARD, Chairman, Regulatory Commission of Alaska (RCA),
Department of Commerce, Community and Economic Development noted
that she had no further testimony.
Co-Chair Green voiced appreciation for the efforts that had been
exerted to correct the Sec. 3 language conflict.
[NOTE: While Co-Chair Green did not formally remove her objection
to the adoption of the Version "Y" committee substitute, that was
the implied intent.]
Senator Stedman moved to report the bill from Committee with
individual recommendations and accompanying fiscal notes.
There being no objections, SC SB 157 (FIN) was REPORTED from
Committee with $1,300 fiscal note #2 dated April 7, 2005 from the
Department of Commerce, Community and Economic Development.
4:40:29 PM
AT EASE: 4:40:46 PM/ 4:41:25 PM
CS FOR HOUSE BILL NO. 147(FIN) am
"An Act relating to notice of suspension or revocation of an
insurer's certificate of authority and the effect of the
suspension or revocation upon the authority of agents and
managing general agents of the insurer; relating to certain
deposits under AS 21; relating to the yielding of assets and
securities held on deposit; relating to third-party
administrators under AS 21; relating to insurance agents,
managing general agents, reinsurance intermediary managers,
and insurance producers; requiring the director of insurance
to notify a licensee of a license renewal before the renewal
date; defining the term 'appointment' as used in part of AS
21; relating to the eligibility to provide coverage by a
nonadmitted insurer and alien insurer; relating to surplus
lines insurance and brokers; relating to misrepresentations
and false advertising concerning insurance; relating to health
discount plans; providing for limitations on owner controlled
and contractor controlled insurance programs and limiting the
coverage of those programs; prohibiting excessive, inadequate,
or unfairly discriminatory rate charges for health insurance;
defining the term 'plan administrator' as used in part of AS
21; defining the term 'transact' as used in AS 21; authorizing
the director of insurance to designate a person to receive
annual reports from companies; reducing the period for filing
a quarterly financial statement; and providing for an
effective date."
This was the first hearing for this bill in the Senate Finance
Committee.
AT EASE 4:41:46 PM / 4:41:57 PM
Senator Stedman moved to adopt committee substitute Version 24-
GH1083\Y as the working document.
There being no objection, Co-Chair Green announced that Version "Y"
would be the working document.
LINDA HALL, Director, Division of Insurance, Department of
Commerce, Community and Economic Development stated that the
Version "Y" committee substitute would implement two changes. The
effect would be to reinstate language that had been included in the
original version of SB 108. The language being added by Version "Y"
is the entirety of Section 1, page two lines eight through 15. In
addition, language in Sections 31 and 32 beginning on page 17, line
25 through page 19 line 30 was reincorporated into the bill to
"address concerns that had been voiced at other hearings". The
purpose would be to provide "some regulatory standards for
reporting for the year-end health trust." The requirements would
include an audited financial statement and an actuarial financial
report. Quarterly financial reports would no longer be required.
Co-Chair Green reminded the Committee that they had previously
discussed SB 108-INSURANCE, and that the language being added to
this bill would align this bill with that bill.
Co-Chair Green asked whether HB 147 would contain any "other major
changes" to the provisions included in SB 108.
Ms. Hall replied in the negative.
4:44:02 PM
Co-Chair Green asked whether the language incorporated in Version
"Y" would satisfy the needs of the Division.
4:44:18 PM
Ms. Hall responded that this legislation would allow the Division
to provide "more streamlined regulations" and to allow the Division
to have the necessary "tools to appropriately oversee those
entities" it regulates.
AT EASE 4:44:36 PM / 4:45:10 PM
Co-Chair Green noted that a new Department of Commerce, Community
and Economic Development fiscal note dated May 6, 2005 has been
distributed. She asked for an explanation of the reason that the
new fiscal note reflected $38,500 rather than the previous zero
fiscal amount.
Ms. Hall informed the Committee that the new fiscal note mirrors
the fiscal note that accompanied SB 108. It would provide a
staffing position to address consumer complaints that the Division
would receive as a result of the additional oversight authority
provided to the Division by this bill.
Co-Chair Wilken moved to report the bill from Committee with
individual recommendations and accompanying fiscal notes.
There being no objection, SCS CS HB 147(FIN) was REPORTED from
Committee with a new $38,500 fiscal note from the Department of
Commerce, Community and Economic Development dated May 6, 2005.
4:46:24 PM
CS FOR HOUSE BILL NO. 218(FIN)
"An Act relating to cost recovery fisheries for private
nonprofit hatchery facilities."
This bill was again before the Committee.
4:46:27 PM
IAN FISK, Staff to Representative Bill Thomas, the bill's sponsor,
responded to Senator Stedman's earlier question regarding which
entities were represented on the Board of the Northern Southeast
Regional Aquaculture Association (ASRAA). The Board is comprised of
15 commercial fishermen who represent equal components of the
"three predominate gear groups": trollers, seiners, and
gillnetters.
Senator Stedman acknowledged.
4:47:51 PM
PETE ESQUIRO, General Manager, NSRAA, testified via teleconference
from Sitka in opposition to the bill. He noted that the
organization testified at each hearing of the bill and had worked
with the bill's sponsor in an effort to improve the bill by
providing "some more reason for any hatchery operator to elect to
use the assessment option" proposed in this bill. However, NSRAA
has determined that discussions must continue in regards to other
major issues such as whether "the assessment would be enforceable";
its affect on the net value of the fishery resource as compared to
now; how the program would be implemented, where the money to
support the first year of operation would be derived, or where
funding might come from in years when assessments provided lower
income than required. In addition, such things as whether the
effects of the program would be equal on all fishermen, and how
this assessment program would affect other gear groups outside of
the seine fishery should be considered.
Mr. Esquiro continued that the NSRAA Board currently has a formula
that it applies to cost recovery. This formula would allow for
those times when one of the programs might not harvest the
anticipated amount of fish; in that case, one of the other cost
recovery programs could assist in providing the required
compensation. Removal of one program from the overall program would
have an impact on the total program. Other concerns would include
the unintended harvesting of other species of fish. These are
examples of the many important issues that must be discussed.
4:51:41 PM
Mr. Esquiro opposed the inclusion of another level of bureaucracy
in the hatchery program as being proposed in Section 1(d) on page
two line 30 through page three line 11. The determination of such
things as the reasonableness of maintenance expenses should be made
the hatchery corporation's board of directors rather than the
Department of Community and Economic Development or the Department
of Revenue. A hatchery's board of directors has the complete
judiciary responsible for the hatchery corporation. Years of
successful hatchery operations are testament to the NSRAA Board of
Directors' ability in this regard.
4:52:33 PM
Mr. Esquiro stated that, due to the fact that this bill is
permissive, there might be a question as to reason that the NSRAA
Board would oppose it. While few options have been developed
through which to address hatchery cost recovery needs, the fact
that numerous issues are yet to be resolved is the reason for the
opposition.
Mr. Esquiro declared that it was apparent from the onset that the
reason for this bill was an endeavor to manage the Hidden Falls
chum salmon fishery. There are numerous views among seine fishermen
in regards to how openings should occur. There are continuing
variables and moving targets. "Nothing is guaranteed" when managing
a fishery; the endeavor would be to manage a fishery as well as
possible. "The paramount goal" of NSCRAA would be to continue "to
provide as many fish as we possibly can to the common property
fisheries."
4:53:54 PM
Senator Stedman and Co-Chair Green thanked Mr. Esquiro for this
testimony.
Mr. Fisk pointed out that many details are included in the proposed
plan in order to allow each hatchery to develop its own plan. Those
details should be developed outside of this legislative body. Each
hatchery has its own unique situation.
4:54:52 PM
Mr. Fisk stated that fishermen throughout Southeast Alaska have
expressed interest in changing the cost recovery system. The seine
fishery group in Southeast Alaska was the first group to forward
such an attempt. However, the bill was developed to allow
hatcheries in other areas of the State to implement the proposed
process.
Mr. Fish noted that Mr. Esquiro would be able to develop plans that
would work in the hatcheries he was involved with. He noted that
the bill would not change the judiciary responsibly of a hatchery's
board.
Senator Stedman pointed out that this Committee is the only
committee of referral for this bill. Noting that the legislation
was not time dependent and determining that NSRAA did not desire
the cost recovery system to occur at this time, he requested that
the bill receive a referral to the Senate Resources Committee. That
committee could address the concerns of the hatcheries and the
stakeholders.
AT EASE 4:56:21 PM / 4:57:52 PM
Senator Stedman moved to report the bill from Committee with the
recommendation that it be referred to the Senate Resources
Committee for additional review.
Co-Chair Green clarified that the Committee's recommendation would
be that the bill be referred to the Senate Resources Committee.
Senator Hoffman objected and suggested that the bill should instead
be sent to the Senate Rules Committee.
AT EASE 4:58:48 PM / 4:59:48 PM
Senator Hoffman removed his objection.
Co-Chair Green stated that the intent of the Committee was to
return the bill to the Senate with the recommendation that the
Senate President add a Senate Resources Committee referral to it.
There being no further objection, the CS HB 218(FIN) was RETURNED
to the Senate with a Memorandum from Senator Green to Senate
President Ben Stevens, dated May 6, 2005, [copy on file] requesting
that a Senate Resources Committee referral be added to the bill.
AT EASE 5:00:21 PM / 5:09:51 PM
SENATE BILL NO. 46
"An Act making capital appropriations and appropriations to
capitalize funds; and providing for an effective date."
This bill had been heard previously in the Senate Finance
Committee.
Co-Chair Wilken moved to adopt committee substitute Version 24-
GS1074\G as the working document.
Senator Hoffman asked for an explanation of the changes
incorporated into Version "G" as compared to the previous committee
substitute, Version 24-GS1074\Y.
5:10:32 PM
GINGER BLAISDELL, Staff to Senator Green, explained that Version
"G" is limited to three program areas. Those areas include Governor
Frank Murkowski's request for full funding for the Department of
Environmental Conservation's Village Safe Water Program; the
Department of Transportation and Public Facilities STIP program and
the match required for that; and the Department of Transportation
and Public Facilities' airport improvement program and the State
match required for that." This bill would be limited to those three
programs.
Senator Hoffman inquired to the status of the federal funds
specified for armories in the Department of Military and Veterans
Affairs.
5:11:38 PM
Ms. Blaisdell noted that "a number of other types of federal funds
were requested in the Governor's original capital budget". However,
the three aforementioned programs were selected due to their
significant federal impact statewide. The "choice" was made not "to
go project by project in each agency."
There being no objection, the Version "G" committee substitute was
ADOPTED as the working document.
AT EASE 5:12:16 PM / 5:13:28 PM
Co-Chair Green informed the Committee that pages 26 and 27 of the
bill would identify the totals of the expenditures and what funds
would be utilized to support this budget.
5:13:50 PM
Senator Hoffman noted that the Department of Military and Veterans
Affairs projects identified on page 38 of the committee substitute,
Version "Y" were entirely federally funded projects.
AT EASE 5:14:27 PM / 5:14:39 PM
Co-Chair Wilken offered a motion to report committee substitute
Version "G" from Committee with individual recommendations.
There being no objection, CS SB 46 (FIN) was REPORTED from
Committee.
AT EASE 5:15:09 PM / 5:16:21 PM
RECESS TO CALL OF CHAIR 5:16:29 PM / 7:05 PM
ADJOURNMENT
The meeting was adjourned at 7:05 PM.
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