Legislature(2011 - 2012)BARNES 124

03/15/2011 03:00 PM House ENERGY


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 36 SMALL BUSINESS ENERGY EFFICIENCY GRANTS TELECONFERENCED
Heard & Held
*+ HB 37 NET ENERGY METERING TELECONFERENCED
Heard & Held
         HB  36-SMALL BUSINESS ENERGY EFFICIENCY GRANTS                                                                     
                                                                                                                              
3:06:14 PM                                                                                                                    
                                                                                                                                
CO-CHAIR PRUITT announced that the  first order of business would                                                               
be  HOUSE BILL  NO. 36,"  An Act  establishing the  Alaska energy                                                               
efficient small business grant fund and program."                                                                               
                                                                                                                                
3:08:22 PM                                                                                                                    
                                                                                                                                
JENNIFER  SENETTE, Staff  for Representative  Kurt Olson,  Alaska                                                               
State  Legislature,  stated that  HB  36  "mirrors" the  existing                                                               
successful  Alaska  Housing  Finance  Corporation  (AHFC)  energy                                                               
rebate  program.   The existing  energy  rebate program  benefits                                                               
residential buildings  and HB 36  intends to establish  an energy                                                               
rebate  program  to benefit  small  businesses,  such that  small                                                               
business owners  wishing to  make energy  efficiency improvements                                                               
on  their businesses  can  receive  a rebate  for  some of  their                                                               
expenditures.   In a manner  similar to the  residential program,                                                               
an energy rater  will evaluate the business  structure before and                                                               
after the improvements are made, thus  the rebate is based on the                                                               
amount of energy efficiency gained.   Furthermore, HB 36 includes                                                               
guidelines  that  businesses  must  meet  as  follows:    1.  The                                                               
assessed value  of the structure  does not exceed $1  million; 2.                                                               
The  structure must  be owned  by  a business  owner licensed  in                                                               
Alaska  and who  does  not have  outstanding  liabilities to  the                                                               
state; 3. The structure must  meet the additional criteria set by                                                               
AHFC.     Ms.  Senette  explained   that  extending   the  energy                                                               
efficiency rebates to the commercial  sector will encourage small                                                               
businesses  in  the state  to  embrace  energy efficiency.    She                                                               
acknowledged that  some details  of the proposed  legislation are                                                               
yet  to  be  worked  out,  such   as  how  the  program  will  be                                                               
capitalized.                                                                                                                    
                                                                                                                                
3:11:42 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   OLSON  further   explained   that  a   committee                                                               
substitute   (CS)   is   being   prepared;   one   change   under                                                               
consideration is  to base  the evaluation of  a structure  on its                                                               
square footage  - instead  of its  assessed value  - in  order to                                                               
better  serve rural  communities.   He  urged the  chair to  hear                                                               
public testimony, but to hold the bill in committee.                                                                            
                                                                                                                                
REPRESENTATIVE SADDLER asked why rebates  will be extended to new                                                               
construction.                                                                                                                   
                                                                                                                                
3:13:17 PM                                                                                                                    
                                                                                                                                
MS. SENETTE acknowledged  that most new buildings  are built with                                                               
energy  efficiency  in  mind,  however,   the  bill  follows  the                                                               
parameters  set by  AHFC's home  energy rebate  program, and  new                                                               
homes are included in that program.                                                                                             
                                                                                                                                
REPRESENTATIVE  SADDLER   then  asked   whether  the   bill  will                                                               
authorize the state to provide second mortgages to businesses.                                                                  
                                                                                                                                
CARY  BOLLING,  Government   Relations  Officer,  Alaska  Housing                                                               
Finance   Corporation  (AHFC),   Department  of   Revenue  (DOR),                                                               
responded  that the  present  home energy  rebate  program has  a                                                               
separate  component  that allows  an  applicant  to apply  for  a                                                               
$30,000 loan for  energy-saving improvements.  After  the work is                                                               
done, the rebate  is applied to the loan balance.   However, AHFC                                                               
does not  have a loan  program for businesses  at this time.   In                                                               
further response  to Representative  Saddler, he said  AHFC would                                                               
undertake  a   similar  program   for  businesses  if   one  were                                                               
appropriated by the legislature.                                                                                                
                                                                                                                                
3:16:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SADDLER  called attention to  page 2, line  11, of                                                               
the bill  and read,  "None of  the applicants  for the  grant has                                                               
outstanding  liabilities  to  the  state."   He  asked  what  the                                                               
sponsor intended by this language.                                                                                              
                                                                                                                                
REPRESENTATIVE  OLSON indicated  he  was unsure;  however, it  is                                                               
prudent to ensure that any  previous liabilities to the state are                                                               
current.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  PETERSEN asked  whether a  student loan  from the                                                               
state would disqualify an applicant.                                                                                            
                                                                                                                                
3:17:53 PM                                                                                                                    
                                                                                                                                
MS. SENETTE offered to further define the language.                                                                             
                                                                                                                                
3:18:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN  asked whether  a large chain  store like                                                               
Wal-Mart would be able to apply if it had a small building.                                                                     
                                                                                                                                
MS. SENETTE indicated yes, if it met the guidelines.                                                                            
                                                                                                                                
REPRESENTATIVE  OLSON  opined  the  fiscal  note  would  grow  if                                                               
applicants are  qualified on their  assets and liabilities.   His                                                               
personal  experience   with  AHFC's   home  energy   program  was                                                               
favorable, and  his intent by  this legislation is to  extend the                                                               
same benefits to small businesses.                                                                                              
                                                                                                                                
3:20:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN  agreed with the idea,  and asked whether                                                               
the legislation needs to define  "a small business."  The federal                                                               
definition of 100 employees may not apply in Alaska.                                                                            
                                                                                                                                
REPRESENTATIVE OLSON  recalled legislation  on this issue  was to                                                               
be included in  the "omnibus energy bill" that  passed last year,                                                               
and  offered  to reassign  HB  36  to  the energy  committee  for                                                               
further refinement.                                                                                                             
                                                                                                                                
REPRESENTATIVE PETERSEN reminded the  committee AHFC estimated an                                                               
additional  $75 million  was required  to  continue its  existing                                                               
rebate and weatherization programs.                                                                                             
                                                                                                                                
3:23:28 PM                                                                                                                    
                                                                                                                                
SEAN  SKALING,  Program  Manager for  Energy  Efficiency,  Alaska                                                               
Energy  Authority  (AEA),  Department of  Commerce,  Community  &                                                               
Economic Development  (DCCED), informed the committee  AEA has in                                                               
place a  commercial energy audit  program funded by  the American                                                               
Recovery and  Reinvestment Act of  2009 (ARRA).  During  the six-                                                               
week   application   period,    one   hundred   and   thirty-five                                                               
applications were received.  He  explained that this program will                                                               
subsidize the cost of an energy audit for an amount from $1,000-                                                                
$6,000 on  a commercial  building up to  one hundred  and twenty-                                                               
five  thousand square  feet  in  size.   Mr.  Skaling opined  the                                                               
number of  applications received indicates  that there is  a need                                                               
for  energy-related programs  for the  privately-owned commercial                                                               
sector.                                                                                                                         
                                                                                                                                
3:26:35 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PETERSEN  asked  whether  rental  property  would                                                               
qualify for the small business  energy rebate program established                                                               
by HB 36.                                                                                                                       
                                                                                                                                
MS. SENETTE said she was unsure.                                                                                                
                                                                                                                                
REPRESENTATIVE SADDLER supported the idea of the bill.                                                                          
                                                                                                                                
3:27:26 PM                                                                                                                    
                                                                                                                                
[HB 36 was held for further testimony.]                                                                                         
                                                                                                                                
3:27:48 PM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 3:27 p.m. to 3:27 p.m.                                                                       
                                                                                                                                
3:30:34 PM                                                                                                                    
                                                                                                                                

Document Name Date/Time Subjects
HB 36 - 2 Sponsor Statement.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 3 Sectional Analysis.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 1 Version A.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 4 AHFC Home Energy Rebate Frequently Asked Questions.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 6 Letter of Support from NFIB.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 5 AHFC Home Energy Rebate Program Guidelines.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 36 - 7 AHFC Fiscal Note HB36-DOR-AHFC-03-15-11.pdf HENE 3/15/2011 3:00:00 PM
HB 36
HB 37 - 01 Version A.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 02 Sponsor Statement.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 03 Sectional Analysis.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 05 Net Metering Map by NC State University, February 2009.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 04 RCA Fiscal Note CCED-RCA-03-11-11.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 08 RCA Net Metering Order R-09-1(3), Appendix B, 15 January 2010.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 06 RCA Net Metering Order R-09-1(3), 15 January 2010.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 07 Catching wind of alternative energy by the Peninsula Clarion, 11 March 2011.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 10 RCA Net Metering Order R-09-1(4), Appendix, 26 April 2010.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 09 RCA Net Metering Order R-09-1(4), 26 April 2010.pdf HENE 3/15/2011 3:00:00 PM
HB 37
HB 37 - 11 Testimony by Marilyn Leland, Alaska Power Association.pdf HENE 3/15/2011 3:00:00 PM
HB 37