Legislature(2007 - 2008)SENATE FINANCE 532
07/24/2008 09:00 AM Senate FINANCE
Audio | Topic |
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Start | |
SB4002 | |
SB4003 | |
Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
+= | SB4002 | TELECONFERENCED | |
+= | SB4003 | TELECONFERENCED | |
SENATE BILL NO. 4003 "An Act making supplemental appropriations to the Alaska Energy Authority for power cost equalization; making special appropriations to the Department of Revenue and to the Department of Health and Social Services for the Alaska resource rebate program; making a special appropriation to the Department of Revenue for the payment of certain shared taxes relating to aviation fuel; and providing for an effective date." Ms. Rehfeld noted that SB 4003 was the appropriation legislation for SB 4002. The legislation appropriates nearly $820 million, $800 million of which is for the one- time payment to eligible individuals for the resource rebate program. It does include the associated administrative costs. There is also $10.7 million included in the hold harmless provisions. Ms. Rehfeld noted there is also a request for $9.6 million for the Power Cost Equalization (PCE) program. Of that amount, $600,000 is to fully fund the FY 08 appropriation and cost for PCE so there would be no proration required. The Alaska Energy Authority has estimated a potential $9 million shortfall in the PCE program for FY 09 based on estimates of increased fuel costs. Ms. Rehfeld concluded that an additional $150,000 would be requested to hold harmless municipalities that have municipal owned airports. 10:29:51 AM Senator Elton asked for clarification about the interplay between SB 4002 and SB 4003. In SB 4002, Section 1 provides that "subject to appropriation and availability of funds for the program, individuals eligible for the program may receive a payment in the amount of $1,200". In SB 4003, on page 2, line 22, it says, "the sum necessary, estimated to be at $800 million". He inquired which bill was primary. Mr. Burnett said that the $1,200 would go to everyone. Should the legislature chose a different amount, it would be pro-rated. As the bills are currently written, it would allow for $1,200 to each person. 10:32:29 AM Senator Elton thought that in January a supplemental may be required. Mr. Burnett said the bill, as currently written, would allow for spending beyond $800 million. Senator Huggins posited a scenario whereby fuel costs remain the same and next July the expectation by Alaskans is that they receive another rebate. Ms. Rehfeld did not disagree with the scenario, but emphasized that the bill is a one-time payment. Senator Huggins asked how the administration will keep this to one year. Ms. Rehfeld hoped that the current legislation would provide some relief, but she could not say what might happen in the future. Senator Huggins suggested that an expectation is being created. 10:36:08 AM Senator Olson asked about page 3 regarding municipality airports. He wondered who would be the beneficiaries of the subsection. Mr. Burnett reported that taxes are not shared with anyone besides municipal airports in this program. The largest amount to a municipality is to Juneau. Senator Olson wondered if the bias is towards municipal or rural airports. Mr. Burnett replied that Fairbanks and Anchorage have state-owned airports. This program is designed for sharing with municipal airports around the state. Co-Chair Stedman wondered if it was a resource rebate or an energy rebate. He questioned if there should be a trigger amount before the state steps in to help. Ms. Rehfeld had not heard of information regarding that. Co-Chair Stedman wondered about the ramifications when this rebate is discontinued. Ms. Rehfeld understood the concern. She reiterated that the rebate is intended to be a one-time payment. 10:39:52 AM Senator Elton referenced the section on aviation tax and requested more information about how much revenue would be lost. He did not see a problem with the benefits from a tax suspension. He wondered how much of a benefit the commercial industry would be getting. Mr. Burnett said there is no way to know who is purchasing the fuel. Senator Thomas believed that the price of oil was not going to go down. He thought the programs should be in place for 3 - 5 years. SB 4003 was heard and HELD in Committee for further consideration. 10:45:22 AM Co-Chair Stedman spoke of discussions on longer-term solutions to the energy problems in Alaska.
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