Legislature(2005 - 2006)

05/04/2005 04:52 PM FIN


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 243                                                                                                            
                                                                                                                                
     "An Act relating  to the maximum annual  regulatory cost                                                                   
     charge   collected   from   certain   regulated   public                                                                   
     utilities  and pipeline carriers;  and providing  for an                                                                   
     effective date."                                                                                                           
                                                                                                                                
Representative Stoltze  MOVED to ADOPT work draft  for HB 243                                                                   
labeled   24-GH1138\Y,  Craver,   5.3.05.   There  being   NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
Representative  Kelly observed that  the legislation  has the                                                                   
support  of the  Governor and  Alaska Industrial  Development                                                                   
and Export  Authority (AIDEA).  The legislation would  extend                                                                   
for one year the opportunity for  the Four Dam Pool utilities                                                                   
to  create a  financing  agreement  that is  satisfactory  to                                                                   
AIDEA.                                                                                                                          
                                                                                                                                
9:23:16 AM                                                                                                                    
                                                                                                                                
Representative  Hawker spoke  in support  of the  legislation                                                                   
and pointed out  that there would be a zero  fiscal note from                                                                   
Department of Commerce, Community and Economic Development.                                                                     
                                                                                                                                
9:24:03 AM                                                                                                                    
                                                                                                                                
Vice-Chair Stoltze requested comments from Mr. Miller.                                                                          
                                                                                                                                
RON   MILLER,    EXECUTIVE   DIRECTOR,   ALASKA    INDUSTRIAL                                                                   
DEVELOPMENT    AND    EXPORT   AUTHORITY,    (AIDEA),    (via                                                                   
teleconference) explained  that the one year  extension would                                                                   
allow  the  Four  Dam  Pool  power   agencies  to  provide  a                                                                   
financing plan  demonstrating committed funds  for completion                                                                   
of  the   Swan/Tyee  project.   According  to  the   original                                                                   
Memorandum of  Understanding (MOU),  the Four Dam  Pool Power                                                                   
Agency had until  April 11, 2005 to provide  such a financing                                                                   
plan to AIDEA. A plan contingent  on state and federal grants                                                                   
was  submitted,   but  not   accepted.  An  alternative   was                                                                   
proposed,  which  would  require  the Agency  to  deposit  $5                                                                   
million with  AIDEA or  Alaska Energy  Authority (AEA)  in an                                                                   
escrow account.  The $5  million would be  a credit  that the                                                                   
Four Dam Pool Power Agency would  be required to pay into the                                                                   
PCE endowment should  they not come up with  a financing plan                                                                   
showing  committed sums  to complete  the  project. This  was                                                                   
agreed to in the  MOU. He observed that AIDEA  has proposed a                                                                   
mechanism to  allow the Agency  to retain interest on  the $5                                                                   
million proposal.  He noted  that AIDEA  does not support  of                                                                   
oppose the legislation.                                                                                                         
                                                                                                                                
9:27:20 AM                                                                                                                    
                                                                                                                                
In response to  a question by Vice-Chair Stoltze,  Mr. Miller                                                                   
clarified that the legislation  pertains to the Four Dam Pool                                                                   
Power Agency and  is not connected to Healy  coal production.                                                                   
There  is a  potential  impact to  the  PCE endowment.  There                                                                   
could be a possible loss in earnings  to the endowment from a                                                                   
one-year delay. He observed that  it is a policy call for the                                                                   
legislature.                                                                                                                    
                                                                                                                                
9:29:26 AM                                                                                                                    
                                                                                                                                
Representative Weyhrauch  summarized that the  legislation is                                                                   
an innocent extension  to allow the parties  to establish the                                                                   
terms of  a MOU.  The potential  impact of the  PCE is  a by-                                                                   
product  of  the extension.  In  response  to a  question  by                                                                   
Representative Weyhrauch, Mr.  Miller noted that the Four Dam                                                                   
Pool Power Agency  is a joint action agency  that was created                                                                   
to acquire  the Four Dam Pool  assets from the  Alaska Energy                                                                   
Authority.  Wrangell, Ketchikan,  Kodiak,  Copper Valley  and                                                                   
Petersburg make up  the agency, which is not  a state agency.                                                                   
The MOU  agreement is between the  AEA and the Four  Dam Pool                                                                   
Power Agency.                                                                                                                   
                                                                                                                                
9:31:24 AM                                                                                                                    
                                                                                                                                
Representative Kelly  referred to "may"  on page 4,  line 10,                                                                   
which  would  benefit  AEA  and  AIDEA.  He  noted  that  the                                                                   
Governor is in support of this bill.                                                                                            
                                                                                                                                
9:32:26 AM                                                                                                                    
                                                                                                                                
Representative Hawker  asked if the fiscal note  was from the                                                                   
Regulatory  Commission of Alaska  and asked  AIDEA if  a zero                                                                   
note is appropriate.                                                                                                            
                                                                                                                                
9:32:58 AM                                                                                                                    
                                                                                                                                
SHARON  FISHER,  ALASKA  INDUSTRIAL  DEVELOPMENT  AND  EXPORT                                                                   
AUTHORITY,  (AIDEA),  (via teleconference)  stated  that  the                                                                   
fiscal  note should  be indeterminate  due to  the loss  of a                                                                   
year's worth of interest, if money is not held in escrow.                                                                       
                                                                                                                                
9:33:57 AM                                                                                                                    
                                                                                                                                
Representative  Hawker  MOVED  to remove  of  the  Regulatory                                                                   
Commission of  Alaska fiscal note and adopt  an indeterminate                                                                   
note  from  AIDEA.  There  being  NO  OBJECTION,  it  was  so                                                                   
ordered.                                                                                                                        
                                                                                                                                
Representative Kelly agreed with the indeterminate note.                                                                        
                                                                                                                                
Vice-Chair Stoltze  said he is  operating under  a good-faith                                                                   
effort by allowing an indeterminate fiscal note.                                                                                
                                                                                                                                
9:35:48 AM                                                                                                                    
                                                                                                                                
Representative Kelly  MOVED to report  CSHB 243 (FIN)  out of                                                                   
Committee  with  individual  recommendations   and  with  the                                                                   
accompanying fiscal  note. There  being NO OBJECTION,  it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
CSHB  243 (FIN)  was REPORTED  out  of Committee  with a  "no                                                                   
recommendation" recommendation  and with a  new indeterminate                                                                   
fiscal impact  note by the Department of  Commerce, Community                                                                   
and Economic Development.                                                                                                       
                                                                                                                                
9:36:28 AM                                                                                                                    
                                                                                                                                

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