Legislature(2007 - 2008)BARNES 124
07/15/2008 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB4002 | |
| HB4003 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB4002 | TELECONFERENCED | |
| += | HB4003 | TELECONFERENCED | |
HB4003-APPROP: ENERGY RELIEF/REBATE/FUEL TAX 9:43:41 AM CO-CHAIR FAIRCLOUGH announced that the final order of business would be HOUSE 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." 9:44:05 AM KAREN J. REHFELD, Director, Office of Management & Budget, Office of the Governor, noted that Jerry Burnett had touched upon some factors of HB 4003 during discussion of HB 4002. In addition to the resource rebate amount of $800 million and the hold harmless, which is $10.7 million, there are some other items in the bill, she noted. First, she said OMB has requested the legislature's approval of a $9.7 million power cost equalization (PCE) program, which would also require a $600,000 component in fiscal year 2008 (FY 08) to fully fund the PCE program in 2008, and an estimated additional $9 million related to "looking at what has changed in oil changes for FY 09." Additionally, $150,000 has been requested, which Ms. Rehfeld explained is a shared tax, hold harmless, and she indicated that that is in a bill not before the committee - a bill related to the suspension of the motor fuel tax. She explained that there are several communities with municipally owned airports. If aviation fuel tax were suspended, it would hold harmless those airports for that loss of revenue. She said, "So, it's a small component of that bill, but it is included in this appropriation bill that's before you." 9:46:09 AM MS. REHFELD presented a sectional analysis. Sections 1(a) and 1(b) show the appropriation request for the PCE, with an increase of $600,000. It changes the existing appropriation to reflect those increases. Sections 1(c)-(e) adjust the appropriations for FY 09 based on the current estimate. Section 2 is the appropriation of $800 million to the Department of Revenue for the resource rebate program, and it includes the administrative cost of approximately $800,000 for the nonpermanent positions talked about by Mr. Burnett during the hearing on HB 4002. Section 3 is the hold harmless provision under the Department of Health & Social Services, with an estimated amount of $10.7 million to continue eligibility for certain assistance programs resulting from the resource rebate. Ms. Rehfeld noted that there are administrative costs of about $770,000, and approximately 9 nonpermanent positions that would be created to do that work. Section 4, she said, would give an estimated $150 to the Department of Revenue for shared taxes related to hold harmless and suspension of aviation fuel tax. Ms. Rehfeld noted that several communities would receive funding under that appropriation, including Anchorage, Juneau, the Ketchikan Gateway Borough, Kenai, Kodiak, Palmer, Soldotna, and Wasilla. Section 5 would provide a retroactive date for the appropriations requested in Section 1(a) and 1(b) for the PCE shortfall in fiscal year 2008. Section 6(a) holds contingent language for Sections 2 and 3 of the bill, having to do with the resource rebate program, while Section 6(b) is a contingency related to the passage of the bill suspending the motor fuel tax. Finally, Section 7 provides the immediate effective date. 9:48:48 AM REPRESENTATIVE NEUMAN said he had requested a long-range plan, having spoken about the issue with Commissioner Pat Galvin. He observed that the state seems to be preparing to spend several billions of dollars. He listed the PCE, roads related to this pipeline, workforce training, mass transit, and the increased cost of operating budgets. Representative Neuman said he thinks spending money on building the state's infrastructure is an important part of the capital budget process, because "it comes right from the communities that we represent." A lot of the capital budget projects were "needled" this year, he said, because the legislature was told there was no money for them. He stated that he is getting mixed signals. He disagreed with a statement he said was made by Randy Ruaro that the state has excess money. He not only said there is no excess money, but he also predicted that the state would be in deficit in a few years. MS. REHFELD said she shares Representative Neuman's views regarding the need for a long-range plan. She said legislation has been passed, which requires that a long-range plan be produced when [the administration] brings the budget to the legislature this December. She related that there are many things impacting Alaska in a way that could not have been predicted even six months ago. With or without the gas line, she said, the state has a huge need in the areas of deferred maintenance and infrastructure development, and a long-range plan is absolutely critical, so that "we" know how best to invest "those dollars." MS. REHFELD related that the governor has, since the beginning of her term, maintained that [the administration] would be responsible and reasonable in the proposals that it brings before the legislature, and the governor's goals have been to control the growth of government and save for the future She said, "That is exactly how we're going to be able to bridge the gap between now and the time we see ... revenues from first gas, but that is going to take some significant discipline, even with some of the increases that we're seeing here." She said the state needs to move forward in a responsible manner, and the administration is working diligently to bring [long-term] plans to the legislature. She noted that Mr. Haagenson has "hit the deck running on the energy plan." She emphasized the importance of investing wisely in energy projects to get the best return for the state's investment. MS. REHFELD stated: The governor's proposals here today ... [were] designed to be very short-term, to do a rebate back to Alaskans based on the revenue that we have seen, knowing that, with that increase in revenue to Alaska, we also have communities and individuals and families that are hurting because of these increased costs. It was not meant to be a long-term answer; ... this is a very short-term solution while we continue to look forward on these other components. 9:53:07 AM REPRESENTATIVE NEUMAN indicated that he was asking yet again for an estimate of "what's on the table right now" from various departments. He said there are people with no medical insurance in the state, and whether or not they can pay their heating bills won't matter if they cannot survive due to health issues. He clarified that he wants to see in writing how much the state will be spending in the next few years on various proposed programs, and he predicted that that number would be in the billions. He reiterated that he does not think there will be "extra" money in the next few years. MS. REHFELD reiterated that the governor agrees that a long-term plan is needed, and she said she would bring that plan to the legislature. 9:54:09 AM CO-CHAIR FAIRCLOUGH noted that Representative Olson, as chair of the House Labor and Commerce Standing Committee, has control of a bill relating to motor fuel tax, and she suggested that he could perhaps present the issue to the House Community and Regional Affairs Standing Committee. 9:54:24 AM CO-CHAIR LeDOUX inquired as to the criteria that would make a community eligible for the PCE. MS. REHFELD deferred to Sara Fisher-Goad. 9:54:59 AM SARA FISHER-GOAD, Deputy Director, Operations, Alaska Energy Authority (AEA), in response to Co-Chair LeDoux, noted that there are approximately 180 communities in the state eligible for the PCE program, and she said those communities that used at least 75 percent diesel in 1984 are eligible. She listed the following as ineligible: Four Dam Pool communities, railbelt communities, and any community that has a rate for power less than the floor, which for this year is 12.83 cents. 9:56:02 AM CO-CHAIR LeDOUX asked if there has been any thought given to revisiting PCE and expanding it to include the entire state, depending upon what the costs of energy are for the various communities. MS. FISHER-GOAD replied that the call has been expanded to address PCE, but she offered her understanding that that was an issue "requested from legislators to do that"; the administration is not proposing changes to the PCE program at this point. She related that she has heard there is concern regarding a 12.83 cent floor being based upon the three communities. She indicated that there are other communities that have power costs greater than 12.83 cents currently, for example, Kodiak, Glen Allen, and even Fairbanks. 9:57:25 AM CO-CHAIR FAIRCLOUGH said the committee would have some discussion related to motor fuel tax and whether or not there would be any impact on federal appropriation. She noted that some time ago, [in certain parts of the state], the 55 mile per hour (mph) speed limit was changed to 65 mph, and she revealed that she was one of a minority serving on a community council who voted against that speed increase for safety concerns; however, she said she has heard since that driving slower saves gas. She complimented Juneau on its recent conservation efforts during its energy crisis, and she talked about the state considering its own energy consumption and then setting an example for the people of Alaska to follow. 10:00:47 AM RANDY RUARO, Special Staff Assistant, Office of the Governor, said there is a computer system used for fuel monitoring that he thinks is currently used by the ferry system used in British Columbia, and is used on one vessel in Alaska, as well as being considered for use on two more. Conservation efforts are ongoing, Mr. Ruaro said, but he told the committee that Mr. Haagenson would better be able to provide a more comprehensive overview of the state's conservation efforts. 10:01:31 AM CO-CHAIR FAIRCLOUGH returned the subject of the highway speed limit and asked Mr. Ruaro if there is data that proves that driving 55 mph reduces consumption and saves lives. MR. RUARO responded that he does not know the answer, but he agreed to obtain information from Department of Transportation & Public Facilities' (DOT&PF's) Division of Highway Safety. He recollected that certain counties in Washington state may have returned to a 55 mph speed limit. MS. REHFELD noted that because of Juneau's experience, there have been real savings seen in state agencies, and "we" are asking departments to figure out which of the measures Juneau residents have taken can be implemented on an ongoing basis. 10:03:00 AM REPRESENTATIVE SALMON asked for an explanation of the numbers shown on page 2, line 6, of HB 4003. MS. REHFELD responded as follows: In subsection (b), what you're seeing is the $9 million going into the fund capitalization - a power cost equalization fund - and then in sub part (d) you're seeing the increase in the appropriation to be able to expend the $9 million. 10:04:45 AM REPRESENTATIVE SALMON said he would like an explanation of the numbers shown [on page 2, lines 10-12]. MS. REHFELD responded: The component that is coming from the $16 million is the component that is ... generated from the power cost equalization fund - the endowment fund - and then it's further capitalized, the state general fund, so we have to put the additional $9 million in general funds in, in order to be able to fully fund the program. MS. REHFELD, in response to Co-Chair Fairclough, confirmed that the amount shown in brackets on line 12, "[$9,353,800]", denotes a deleted number. She said, "It was a lower amount in the original bill, and we're adding the $9 million to that." REPRESENTATIVE SALMON noted that the number in the brackets is $353,800 over $9,000,000, and he asked where that overage goes. MS. REHFELD responded as follows: It's just an increase to the original number was $9,353,000, and we've just added another $9 million to that number. So, it's just the total ... now of general funds going to the power cost equalization program will be $18,353,800. CO-CHAIR FAIRCLOUGH reiterated her interest in finding out how individual families and public service announcements can affect conservation efforts. [HB 4003 was heard and held.]
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