Legislature(2011 - 2012)BARNES 124
03/29/2011 03:00 PM House ENERGY
| Audio | Topic |
|---|---|
| Start | |
| HB197 | |
| Overview: Update on the Alaska Stand Alone Gas Pipeline | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| *+ | HB 197 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HB 197-HOME ENERGY RATING SYSTEM
3:04:50 PM
CO-CHAIR PRUITT announced that the first order of business would
be HOUSE BILL NO. 197, "An Act recognizing the Alaska Housing
Finance Corporation as the authorizing agency to approve home
energy rating systems for the state; and providing for an
effective date."
3:05:31 PM
JEREMIAH CAMPBELL, Staff, Representative Lance Pruitt, Alaska
State Legislature, introduced HB 197 on behalf of Representative
Pruitt, sponsor. Mr. Campbell stated HB 197 recognizes the
Alaska Housing Finance Corporation (AHFC) as the state's Home
Energy Rating System (HERS) authorizing agency for the purpose
of approving home energy rating systems for use in the state.
This legislation is needed because non-governmental, for-profit,
third-parties are attempting to be identified in federal
legislation as the HERS agency in the state, in order to control
state policy on the issue, and to compete for funds that are
available to the state. Alaska has made an investment in AHFC
through its rating system software called AkWarm, and he opined
it is appropriate for Alaska to run the program, and not a
third-party. The AkWarm software has been used continuously
since 1996, and is designed specifically for Alaska. In
addition, AkWarm is directly tied to AHFC programs such as the
home energy rebate and weatherization programs, interest rate
reduction for home loans, and Alaska Building Energy Efficiency
Standards (BEES). This bill would enable AHFC to ensure that
any HERS utilized in Alaska would be appropriate for Alaska
climates.
REPRESENTATIVE SADDLER asked what organizations are attempting
to get certification and compete with AHFC.
3:08:13 PM
JOHN ANDERSON, Weatherization Officer, Alaska Housing Finance
Corporation (AHFC), Department of Revenue, informed the
committee that currently the organization recognized by the
Internal Revenue Service (IRS) and the U.S. Department of Energy
(DOE) is the Residential Energy Services Network (RESNET).
REPRESENTATIVE PETERSEN noted DOE uses the Smart Home Scale, and
the Environmental Protection Agency (EPA) uses Energy Star
ratings, both of which are administered by RESNET. He asked
whether the standards in Alaska would be equivalent, so that
these programs would be recognized by AHFC.
3:09:44 PM
MR. ANDERSON confirmed that AkWarm is also recognized by DOE for
AHFC's weatherization purposes in Alaska. He opined AkWarm is
far more sophisticated than the other programs, and AHFC wants
it to be the standard; in fact, AHFC has invested $1 million in
the software and upgrades since 1992. In addition, AHFC is
developing a commercial model for its public facility building
revolving loan fund.
REPRESENTATIVE PETERSEN surmised that the bill creates a new
regulatory function for AHFC.
3:10:42 PM
MR. ANDERSON explained that AHFC has administered the program
and authorized energy raters since 1992. Although independent
software may be adequate, AHFC's stance is to require other
programs to be equivalent to AkWarm.
REPRESENTATIVE PETERSEN asked whether the intent of the bill is
to ensure that all federal funding available for energy rating
programs goes to AHFC.
MR. ANDERSON clarified that the main focus is to protect the
state's investment in the AHFC program. The federal government
has named a for-profit private entity, but AHFC is experienced,
and is leading the nation on residential energy efficiency.
3:12:26 PM
REPRESENTATIVE PETERSEN asked whether any municipal building
codes will be affected by the bill.
MR. ANDERSON opined no, except for IRS tax credits, because
AkWarm is not recognized by the IRS. He pointed out that IRS
guidelines defer to the RESNET organization; however, this
legislation will help AHFC achieve IRS status. Once IRS status
is achieved, Alaska homebuilders will be able to use AHFC AkWarm
ratings to qualify for tax credits for building energy efficient
homes.
REPRESENTATIVE SADDLER asked whether there are different energy
rating systems, and for the purpose of authorizing agencies.
3:14:08 PM
MR. ANDERSON stated that an authorizing agency sets certain
criteria for software to meet before it can be utilized. The
RESNET organization provides information that is applicable to
Alaska, but AkWarm is a superior product. In further response
to Representative Saddler, Mr. Anderson said the software
provides an energy analysis of a home by measuring the
resistance to heat flow (R) value of walls, roofs, doors,
windows, and heating systems, and accounting for all of the
energy use in a home, followed by a report for improvement
options to raise a home to the building energy efficiency
standard (BEES).
REPRESENTATIVE SADDLER asked whether the bill sets the agency or
the standard.
MR. ANDERSON said the bill gives AHFC the authority to set
standards in its regulations.
3:16:38 PM
DAN FAUSKE, CEO/Executive Director, Alaska Housing Finance
Corporation (AHFC), Department of Revenue (DOR), called
attention to the fact that AHFC is nationally renowned in this
issue, and must ensure Alaska's right to regulate what comes
into the state. He predicted that as the economy improves,
other mortgage companies will return to Alaska and use different
software with lower standards of weatherization; the intent of
the legislation is to prevent the federal government from
mandated changes to a program in which the state has invested
$360 million. Alaska Housing Finance Corporation wants to see
a benchmark for regulations on rating systems.
3:18:31 PM
CO-CHAIR PRUITT asked how this situation would impact a
contractor.
MR. ANDERSON said a contractor does not need to do anything new
right now. However, proposed federal legislation - known as
Home Choice - names RESNET as the governing body of home system
software. As a matter of fact, the Home Choice program mimics
AHFC's home energy rebate program, and the only problem is that
for Alaska, it creates the threat of competing HERS software
that does not meet AkWarm standards. He pointed out that the
AkWarm software database is free to contractors, but others are
not.
3:20:19 PM
CO-CHAIR PRUITT surmised the bill should streamline mortgage
applications and energy programs.
MR. ANDERSON said correct.
MR. FAUSKE reminded the committee that BEES is state law, and
AHFC cannot purchase a mortgage unless an improvement meets
BEES; therefore, if new software is introduced in Alaska with a
lesser standard, AHFC's status in the housing industry is
weakened.
3:21:25 PM
REPRESENTATIVE PETERSEN asked whether federal legislation on
this issue would take precedence over Alaska's AkWarm program.
MR. ANDERSON indicated yes, and agreed with Representative
Petersen that AkWarm should be adopted as the federal standard.
3:22:05 PM
REPRESENTATIVE SADDLER affirmed that HB 197 would give AHFC the
sole authority to decide whether a particular energy rating
software can be used in Alaska.
MR. ANDERSON said correct. In further response to
Representative Saddler, he confirmed that AHFC will only use
AkWarm, unless a better program is developed. In response to
Representative Petersen, Mr. Anderson said AHFC has
unsuccessfully attempted to get an exclusion clause from the
IRS.
3:23:52 PM
REPRESENTATIVE TUCK questioned whether the bill applies only to
energy rating software and not to energy rating procedures,
"above and beyond software."
3:24:19 PM
MR. ANDERSON opined the bill refers to the system because there
is a training component and monitoring of the energy auditors
and raters.
MARY ELLEN BEARDSLEY, Assistant Attorney General,
Commercial/Fair Business Section, Civil Division (Anchorage),
Department of Law (DOL), agreed with Mr. Anderson that the
software is the AkWarm program that has been copyrighted by
AHFC, but the system is not just the program itself.
3:25:40 PM
REPRESENTATIVE TUCK compared this process to certificates of
fitness issued by the Department of Labor & Workforce
Development (DLWD) for electrical licenses. Because the program
establishes an authority, and is more "than just reviewing
software," he asked whether certificates will be issued to
workers after training, and how individual contractors will be
monitored and audited.
3:26:16 PM
MR. ANDERSON affirmed that AHFC authorizes energy raters and
requires certificates that are renewed every three years;
however, if a new entity enters the state, AHFC would review the
new entity's entire process and software.
MR. FAUSKE added that AHFC is trying to protect consumers; in
fact, 126 energy raters have been certified by the corporation.
Although the raters are not employees of AHFC, they visit homes
and offer advice; thus, a governing system is necessary, and
AHFC has filled that role for several years.
3:28:06 PM
REPRESENTATIVE TUCK suggested that another software company may
have a procedure that is more efficient. He asked whether a
conflict would arise if a contractor applied for an IRS tax
credit, but was not permitted to work in Alaska because AHFC's
program is not approved.
3:29:05 PM
MS. BEARDSLEY restated that AHFC has submitted its application
to the IRS to be an alternate agency. In fact, IRS regulations
indicate that RESNET is the authorization entity, "or [that] an
equivalent rating network" is acceptable. She said she was
unsure of the outcome if the matter was referred to the court
system.
MR. ANDERSON explained that at this time there are certified
RESNET auditors in the state "that do some types of tax credits
right now, on the residential ...." This would not change, but
the bill helps get AHFC's software to the same status.
REPRESENTATIVE TUCK asked how the AkWarm software is superior,
and for the difference between them.
3:31:22 PM
MR. ANDERSON reported that RESNET does not own software, but
approves the software systems, and the four systems approved
nationwide are mostly an "input point system" using blank fields
that are filled with information from the home. In contrast,
the AHFC program uses mathematic science to calculate the
insulating properties of walls and windows, ventilation, and
boilers. In further response to Representative Tuck, Mr.
Anderson said AHFC's application process began eight months ago;
in fact, AHFC received DOE's five-year approval to use AkWarm on
single-family homes and duplexes, even though the IRS has not
responded to its application for approval. He acknowledged that
the federal Home Choice bill died, but he expected similar
legislation to surface soon, and restated that AHFC would not
disallow another rating system, as long as it is equivalent.
REPRESENTATIVE PETERSEN asked if there are consequences for the
other rating companies; for example, whether the homes rated by
them are eligible for the state weatherization or energy rebate
programs.
MR. ANDERSON indicated there are no consequences; in fact, some
builders are paying for an additional rating with the software
approved by RESNET, in order to qualify for the IRS tax credit.
3:35:17 PM
PAT LUBY, Advocacy Director, AARP in Alaska, informed the
committee AARP has 93,000 members in Alaska, and wholeheartedly
supports AHFC. Mr. Luby said the weatherization and rebate
programs have proven to be historic in that thousands of
Alaskans have benefitted from the programs. He relayed a story
of how successful energy improvements to homes are, with the
resulting lower utility bills showing that energy is being
saved. Mr. Luby expressed AARP's support of HB 197, for the
benefit of consumers.
REPRESENTATIVE TUCK agreed that the energy programs are
beneficial; however, he questioned how the bill will expand or
provide better service to consumers.
MR. LUBY said AARP does not have the expertise to determine
that, but the testimony today indicated there is a problem with
the IRS.
CO-CHAIR PRUITT closed public testimony.
3:39:06 PM
CO-CHAIR FOSTER moved to report HB 197, 27-LS0628\A, out of
committee with individual recommendations and the accompanying
fiscal note. There being no objection, HB 197 was reported from
the House Special Committee on Energy.
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB 197 - 01 Version A, the Original Bill.pdf |
HENE 3/29/2011 3:00:00 PM |
HB 197 |
| HB 197 - 02 Sponsor Statement.pdf |
HENE 3/29/2011 3:00:00 PM |
HB 197 |
| HB 197 - 03 Sectional Summary.pdf |
HENE 3/29/2011 3:00:00 PM |
HB 197 |
| HB 197 - 04 Fiscal Note HB197-DOR-AHFC-03-24-11.pdf |
HENE 3/29/2011 3:00:00 PM |
HB 197 |
| Presentation on Alaska Stand Alone Gas Pipeline for 29 March 2011.pdf |
HENE 3/29/2011 3:00:00 PM |
Alaska Gasline Development Corporation Presentation |
| HB 197 - 05 AARP Letter of Support, 28 March 2011.pdf |
HENE 3/29/2011 3:00:00 PM |
HB 197 |