Legislature(2013 - 2014)HOUSE FINANCE 519

04/10/2013 01:30 PM House FINANCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Continued at 7:30 p.m. Today --
+= SB 21 OIL AND GAS PRODUCTION TAX TELECONFERENCED
Scheduled But Not Heard
+= SB 18 BUDGET: CAPITAL TELECONFERENCED
Scheduled But Not Heard
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= SB 37 EXTEND SUICIDE PREVENTION COUNCIL TELECONFERENCED
Moved Out of Committee
+= SB 16 BD OF ARCHITECTS, ENGINEERS, SURVEYORS TELECONFERENCED
Moved Out of Committee
+= SB 38 STATE MEDICAL BOARD TELECONFERENCED
Moved Out of Committee
+= SB 88 ALASKA NATIVE MEDICAL CENTER HOUSING TELECONFERENCED
Heard & Held
+= SB 2 INTERSTATE MINING COMPACT & COMMISSION TELECONFERENCED
Moved Out of Committee
+= SB 24 MARINE TRANSPORTATION ADVISORY BOARD TELECONFERENCED
Moved HCS SB 24(TRA) Out of Committee
SENATE BILL NO. 2                                                                                                             
                                                                                                                                
     "An  Act enacting  the  Interstate  Mining Compact  and                                                                    
     relating  to the  compact; relating  to the  Interstate                                                                    
     Mining  Commission;  and  providing  for  an  effective                                                                    
     date."                                                                                                                     
                                                                                                                                
8:01:15 PM                                                                                                                    
                                                                                                                                
SENATOR  CATHY  GIESSEL  introduced  her  bill  which  would                                                                    
elevate Alaska  from an associate member  to full membership                                                                    
in the Interstate Mining Compact  and Commission (IMCC). The                                                                    
change  would allow  Alaska's governor  be an  active voting                                                                    
member  giving Alaska  a voice  on the  national level.  The                                                                    
compact was  established in April  1971 and consisted  of 20                                                                    
member states  and five associate member  states. The powers                                                                    
of the commission  were found on page four of  the bill. The                                                                    
estimated  cost included  $40 thousand  in  dues, which  was                                                                    
partially  based on  resource  production.  She mentioned  a                                                                    
chart  in  the  bill  materials that  illustrated  the  dues                                                                    
calculation.                                                                                                                    
                                                                                                                                
8:05:01 PM                                                                                                                    
                                                                                                                                
ED  FOGELS,  DEPUTY   COMMISSIONER,  DEPARTMENT  OF  NATURAL                                                                    
RESOURCES, testified on the bill.  He stated that Alaska now                                                                    
had seven operating mines that  did well environmentally. He                                                                    
noted  that the  permitting  and  regulatory processes  were                                                                    
improving.  The  bill's  initiative was  to  strengthen  the                                                                    
collaborative   relationship  with   the  federal   agencies                                                                    
because  permitting  relied  heavily on  federal  rules  and                                                                    
regulations.  He  stated  that  IMCC  brought  together  the                                                                    
environmental  and mining  programs  from 26  states in  the                                                                    
nation.  In this  forum,  the  states exchanged  information                                                                    
about potential areas of improvement.                                                                                           
                                                                                                                                
Mr. Fogels  explained that IMCC was  instrumental in helping                                                                    
Alaska  with the  number of  initiatives  where the  federal                                                                    
government was  "over-reaching." He provided an  example. He                                                                    
was the  governor's designee  for IMCC and  he had  seen the                                                                    
benefits of the collaboration first hand.                                                                                       
                                                                                                                                
8:07:46 PM                                                                                                                    
                                                                                                                                
Representative Holmes asked  about page 4 and  the powers of                                                                    
the  commission. She  noted that  the commission  might make                                                                    
recommendations,  which could  be broadly  read. Mr.  Fogels                                                                    
replied  that  frequent  IMCC actions  included  resolutions                                                                    
directed at federal agencies.                                                                                                   
                                                                                                                                
Representative  Costello appreciated  the bill  and she  was                                                                    
disappointed that the  previous version of the  bill did not                                                                    
elevate Alaska to  full membership. She asked  if there were                                                                    
tangible benefits to full members.                                                                                              
                                                                                                                                
8:09:08 PM                                                                                                                    
                                                                                                                                
Mr.  Fogels replied  that the  most significant  benefit was                                                                    
the ability for Alaska to  take a leadership role and better                                                                    
guide  the policy  chosen by  the commission.  Initially the                                                                    
commission was an east-coast coal-centric organization.                                                                         
                                                                                                                                
8:10:10 PM                                                                                                                    
                                                                                                                                
Representative Costello asked  about the committee structure                                                                    
of the  meetings. She asked  about his participation  in the                                                                    
meetings.  Mr. Fogels  replied  that  the commission  hosted                                                                    
multiple  committees and  he had  participated in  meetings,                                                                    
but was not allowed to vote as an associate member.                                                                             
                                                                                                                                
Vice-Chair  Neuman  asked  if IMCC  had  addressed  Alaska's                                                                    
mining  permits. He  asked how  the commission  was able  to                                                                    
help miners.  Mr. Fogels replied that  IMCC recently entered                                                                    
into  a memorandum  of understanding  with  the Mine  Safety                                                                    
Health  Administration.  He  commented  that  smaller  rural                                                                    
mines were unable to abide  by the strict federal guidelines                                                                    
set forth by  the Mine Safety Health  Administration. He was                                                                    
able to bring the concerns  of the smaller Alaskan miners to                                                                    
the attention of IMCC.                                                                                                          
                                                                                                                                
8:12:41 PM                                                                                                                    
                                                                                                                                
Vice-Chair  Neuman  reviewed  the  travel costs  on  page  1                                                                    
showing $20 thousand for two  trips. Mr. Fogels replied that                                                                    
he traveled frugally. He explained  that there were two IMCC                                                                    
meetings per year and the  department sent two people to the                                                                    
meetings.  Additional meetings  were organized  depending on                                                                    
the issues. He stated  that mining symposiums for regulators                                                                    
were also hosted in western  states. He hoped to incorporate                                                                    
staff  from Department  of Environmental  Conservation (DEC)                                                                    
and Department of Fish and Game (DF&G).                                                                                         
                                                                                                                                
8:14:55 PM                                                                                                                    
                                                                                                                                
Representative   Munoz  asked   about  the   404  permitting                                                                    
legislation and how the IMCC  could help. Mr. Fogels replied                                                                    
that  the quest  for  Alaska  state primacy  was  part of  a                                                                    
broader  effort  to  acquire   more  control  over  wetlands                                                                    
permitting  in  Alaska. Each  piece  of  the issue  involved                                                                    
negotiation  with the  federal government.  He noticed  that                                                                    
every mining  state in  the nation  who participated  in the                                                                    
meetings  signaled a  higher level  of anxiety  with federal                                                                    
overreach.                                                                                                                      
                                                                                                                                
8:17:12 PM                                                                                                                    
                                                                                                                                
Senator Giessel added that the  IMCC participated with other                                                                    
western  states  on  issues  related  to  mining  royalties.                                                                    
Alaska did not participate  in much mineral resource royalty                                                                    
sharing.                                                                                                                        
                                                                                                                                
8:18:12 PM                                                                                                                    
                                                                                                                                
Mr. Fogels  added that the  federal government held  back on                                                                    
royalties.  The  IMCC  effort would  also  aid  the  broader                                                                    
resource development spectrum in Alaska.                                                                                        
                                                                                                                                
8:18:48 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze CLOSED public testimony.                                                                                       
                                                                                                                                
Representative  Costello  discussed  the fiscal  notes.  She                                                                    
began with  fiscal note 1,  which showed a fiscal  impact of                                                                    
$60 thousand  for FY 14 through  FY 19, while fiscal  note 2                                                                    
was a zero note.                                                                                                                
                                                                                                                                
Representative Wilson asked about  the second page of fiscal                                                                    
note 1. She  stated that the fiscal note  stated that Alaska                                                                    
would  be the  20th  state to  join the  compact  as a  full                                                                    
member.  She  understood that  Alaska  would  be the  second                                                                    
state  to join  as a  full member.  Mr. Fogels  replied that                                                                    
Utah was  the only western state  that had joined as  a full                                                                    
member.                                                                                                                         
                                                                                                                                
8:21:40 PM                                                                                                                    
                                                                                                                                
Co-Chair Stoltze had an issue  with travel for DNR. He asked                                                                    
Representative  Costello if  she  was  comfortable with  the                                                                    
fiscal note.                                                                                                                    
                                                                                                                                
Representative Costello  wondered about reducing  the travel                                                                    
component  by  half. Mr.  Fogels  replied  that the  meeting                                                                    
opportunities would be fewer.  He stated that the symposiums                                                                    
would not be attended.                                                                                                          
                                                                                                                                
Representative  Costello repeated  the  question to  Senator                                                                    
Giessel. Senator  Giessel stated  that the  attendance would                                                                    
be  reduced for  Alaska  as  a result.  She  hoped that  the                                                                    
department would  find other  means. She  preferred face-to-                                                                    
face attendance to teleconference.                                                                                              
                                                                                                                                
Co-Chair   Stoltze  stated   that   associated  travel   was                                                                    
introduced.                                                                                                                     
                                                                                                                                
8:24:18 PM                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze MOVED  that the  travel portion  of fiscal                                                                    
note 1 was reduced  to $15 thousand. Representative Costello                                                                    
OBJECTED for discussion.                                                                                                        
                                                                                                                                
Representative  Costello understood  that travel  costs were                                                                    
great,  but she  had faith  that the  department would  seek                                                                    
efficiencies.    Representative   Costello    WITHDREW   her                                                                    
OBJECTION.                                                                                                                      
                                                                                                                                
Co-Chair  Stoltze  AMENDED the  fiscal  note  to show  a  $5                                                                    
thousand reduction.                                                                                                             
                                                                                                                                
Co-Chair  Stoltze  asked  if the  dues  were  structured  on                                                                    
production or state revenues.                                                                                                   
                                                                                                                                
8:25:53 PM                                                                                                                    
                                                                                                                                
Mr.  Fogels  replied  that  the  IMCC  structured  the  dues                                                                    
calculation by developing a two-year  budget, which was then                                                                    
projected out and divided in  half. Half of the final number                                                                    
was  prorated and  divided evenly  among member  states. The                                                                    
other half was made up as a percentage of production.                                                                           
                                                                                                                                
Co-Chair  Stoltze understood  that there  was a  cap to  the                                                                    
dues.                                                                                                                           
                                                                                                                                
8:27:12 PM                                                                                                                    
                                                                                                                                
Senator  Giessel commented  that  when new  stated join  the                                                                    
compact as full members, the price of dues decreases.                                                                           
                                                                                                                                
Representative Costello MOVED to REPORT  SB 2 as amended out                                                                    
of  committee   with  individual  recommendations   and  the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
SB  2  was  REPORTED  out  of committee  with  a  "do  pass"                                                                    
recommendation  and with  one new  amended fiscal  note from                                                                    
Department   of  Natural   Resources   and  one   previously                                                                    
published zero fiscal note: FN 2(ADM).                                                                                          
                                                                                                                                
8:29:25 PM                                                                                                                    
                                                                                                                                
Representative Gara  asked about  Department of  Revenue and                                                                    
the offer to answer questions  regarding the modeling of HCS                                                                    
CSSB 21(RES). Co-Chair Stoltze concurred.                                                                                       
                                                                                                                                
8:31:03 PM                                                                                                                    
                                                                                                                                

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