Legislature(2001 - 2002)

04/20/2001 01:50 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
SB 158-REPORT:STATE PARTICIPATE IN NAT GAS PIPE.                                                                              
Number 1260                                                                                                                     
CO-CHAIR MASEK  announced that the  next order of  business would                                                               
be CS  FOR SENATE  BILL NO.  158(RES) am,  "An Act  directing the                                                               
commissioner of  revenue to prepare  a report to  the legislature                                                               
relating to  the state's participation  in owning or  financing a                                                               
gas  pipeline  project; and  providing  for  an effective  date."                                                               
After much discussion, it was  determined that HCS CSSB 158(O&G),                                                               
version 22-LS0744\O, was before the committee.                                                                                  
Number 1407                                                                                                                     
SENATOR JOHN  TORGERSON, Alaska  State Legislature,  testified on                                                               
behalf of the Senate Resources  Committee, the sponsor of SB 158.                                                               
Senator  Torgerson   pointed  out   that  there  has   been  much                                                               
discussion as to  whether "we" should take  ownership interest in                                                               
a pipeline.   This legislation  establishes the parameters  for a                                                               
study  in  order  to  determine  whether  the  aforementioned  is                                                               
appropriate or  not.  The  legislation also [requires]  review of                                                               
whether the  state should participate  in financing  the project,                                                               
and  if  so, in  what  capacity.   Furthermore,  the  legislation                                                               
requests that the  Department of Revenue review the  risks to the                                                               
state when taking ownership.  On  page 3, beginning on line 2, is                                                               
language that  specifies that the department  shall contract with                                                               
a qualified person or firm.  Since  the desire is to do this in a                                                               
timely manner, procurement under AS  36.30 is impracticable.  The                                                               
legislation requires  that the  contractor or  its representative                                                               
meet with  the chairs  of the  "committees that  have legislative                                                               
jurisdiction  over  natural  resources".     Furthermore,  it  is                                                               
stipulated that [the  legislature] should have access  to all the                                                               
data that is  collected.  Senator Torgerson pointed  out that the                                                               
legislation specifies that  the report shall be  submitted to the                                                               
legislature no later than January 31, 2002.                                                                                     
SENATOR TORGERSON  pointed out that  the House  Special Committee                                                               
on  Oil  and  Gas  (HO&G)   deleted  the  reference  to  standing                                                               
committee  so  that  it,  as a  special  committee  dealing  with                                                               
natural resources, could be included  in this process.  There was                                                               
also  an amendment  on  the Senate  floor,  which added  language                                                               
requesting a report  that would study the  possibility of natural                                                               
gas  distribution  within  the   state,  by  additional  pipeline                                                               
facilities connected  to population centers  of the state.   That                                                               
language  was  taken  out  because  the  fiscal  note  went  from                                                               
$210,000 to  approximately $500,000.   Since that  floor language                                                               
dealt with  an engineering question  and the bill is  a financing                                                               
bill, the  language was deleted.   Therefore, the  successful bid                                                               
will  first have  to  determine the  location  of the  population                                                               
centers and then  make a determination regarding the  size of the                                                               
pipe and its cost to be laid.                                                                                                   
Number 1597                                                                                                                     
REPRESENTATIVE GREEN  provided the  committee with  the following                                                               
     Page 3, line 9, following "chair the":                                                                                     
          Insert "Alaska Legislative Council and the"                                                                           
He explained that  the chair of the Legislative  Council would be                                                               
added to those people who will  be informed by this study because                                                               
Legislative  Council  will  be  conducting  a  study  during  the                                                               
SENATOR  TORGERSON  related his  first  reaction  that with  that                                                               
amendment  there  would   be  too  many  bosses.     Although  he                                                               
understood that Representative Green wants  a copy of the report,                                                               
he  pointed out  that the  legislation is  referring to  the firm                                                               
actually  meeting   with  the  committee  chairs   and  providing                                                               
progress reports.                                                                                                               
REPRESENTATIVE  GREEN  pointed out  much  is  being done  now  in                                                               
regard  to  the legislature  being  prepared  when the  operators                                                               
provide  [the  legislature]  with   their  analysis  of  the  gas                                                               
pipeline.   Legislative Council  wants to  be prepared  and "have                                                               
equal horsepower  to guide us  in what we  think is best  for the                                                               
state," he  said.  Representative  Green expressed the  need "for                                                               
continuity of review."                                                                                                          
Number 1745                                                                                                                     
SENATOR  TORGERSON said  that  he believes  that  the [House  and                                                               
Senate] Resources Committees will have  more meetings on gas line                                                               
issues than Legislative  Council.  He expressed the  need to make                                                               
the determination as  to whether Legislative Council  is going to                                                               
take the lead on gas line  issues so that there isn't duplication                                                               
of effort.  Senator Torgerson remarked that  he hadn't envisioned                                                               
Legislative Council taking the lead with natural gas issues.                                                                    
REPRESENTATIVE GREEN  contended that  this [amendment] in  no way                                                               
attempts [to place Legislative Council]  in the lead.  He pointed                                                               
out that during the interim  unforeseen issues will arise.  Those                                                               
issues will likely require expertise  that isn't available in the                                                               
legislature  or  the state.    Legislative  Council has  its  own                                                               
budget and  if necessary,  it could pay  to secure  the necessary                                                               
legal, economic, and engineering experts.                                                                                       
SENATOR  TORGERSON remarked  that although  he believes  everyone                                                               
should  obtain copies  of the  report,  he wasn't  sure how  many                                                               
people should  meet with the  contractor.  Therefore,  he thought                                                               
Representative Green's  language may be more  appropriate on page                                                               
3, subsection (3), which discusses progress reports.                                                                            
Number 1884                                                                                                                     
REPRESENTATIVE  FATE inquired  as  to how  the  studies would  be                                                               
done.  He asked if the study embodied  in SB 158 and the study by                                                               
Legislative Council would be parallel studies.                                                                                  
REPRESENTATIVE  GREEN  explained  that he  envisions  Legislative                                                               
Council contracting  with unaffiliated experts  as it did  on the                                                               
Joint Committee on Mergers.  This  is intended to ensure there is                                                               
an unbiased  view of the  situation or  issue.  He  recalled that                                                               
when  Legislative Council  contracted  with unaffiliated  experts                                                               
during the merger  situation, significantly different conclusions                                                               
were reached  [by the unaffiliated  experts and the  task force].                                                               
Although he  doubted that would be  the case with this  issue, he                                                               
wanted to  be sure  that the power  to do what  is right  for the                                                               
state  is  available.   Representative  Green  clarified that  he                                                               
wasn't saying that there should be additional bosses.                                                                           
SENATOR TORGERSON agreed that there  may be some studies that one                                                               
might want to do.  However,  somewhere during the process it will                                                               
have to  be determined who is  hiring for what in  order to avoid                                                               
duplication.    He  related  his  view that  this  looks  like  a                                                               
duplicate effort.   However, he  wasn't sure the  amendment hurts                                                               
anything.  He  noted that everyone is welcome  at these meetings,                                                               
which will be noticed as are all other meetings.                                                                                
Number 2026                                                                                                                     
REPRESENTATIVE  GREEN noted  that  this  legislation directs  the                                                               
commissioner of the  Department of Revenue, who is  chosen by the                                                               
governor, to  prepare this  report.  He  recalled that  when this                                                               
was done before, the legislature  didn't become [involved] in the                                                               
[details] of  what was  going on  and that is  what he  wanted to                                                               
avoid.  Representative  Green asked, "Even though  the chairs are                                                               
kept abreast, will  they know that the  commissioner's review has                                                               
gone  into the  depths that  I feel  are necessary?   They  don't                                                               
necessarily have  the horsepower on  their own right to  do that,                                                               
whereas the Leg Council does."                                                                                                  
SENATOR TORGERSON pointed  out that the amendment  is speaking to                                                               
the contractor not to the commissioner.                                                                                         
REPRESENTATIVE  GREEN related  his belief  that if  the amendment                                                               
was put  in paragraph  (3), then a  report from  the commissioner                                                               
may  be  different if  all  Legislative  Council received  was  a                                                               
progress report and had no input on it.                                                                                         
CO-CHAIR MASEK  related her belief  that the language on  page 3,                                                               
paragraph (2), seems to cover Representative Green's issue.                                                                     
REPRESENTATIVE GREEN  clarified that he  is making an  analogy to                                                               
the group that met regarding the merger.  He explained:                                                                         
     We  thought we  were probably  knowledgeable enough  on                                                                    
     our right that  we would have been  able to understand,                                                                    
     either object,  agree, disagree, whatever.   At least I                                                                    
     found and I would say that  my, at that time, cohort on                                                                    
     the committee found that ...  it's like studying a book                                                                    
     of medicine and  then going to a surgeon.   That people                                                                    
     that   are   experts   in  ...   those   three   fields                                                                    
     specifically,  you  need  them   working  for  you  not                                                                    
     working for someone  else and reporting to  you.  There                                                                    
     is a  significant difference;  that's the  problem with                                                                    
     just getting a report or ... progress reports.                                                                             
REPRESENTATIVE   GREEN  specified   that  Legislative   Council's                                                               
involvement  would  not supersede  anything  that  this group  of                                                               
people  would do.   Representative  Green reiterated  that he  is                                                               
merely suggesting  that Legislative Council be  advised of what's                                                               
going  on as  it happens  because it  may help  uncover something                                                               
that  "we" want  to know.    He said  that he  wanted to  prevent                                                               
something not being uncovered.                                                                                                  
CO-CHAIR MASEK  said that she  felt that  the merger issue  was a                                                               
different issue.                                                                                                                
Number 2218                                                                                                                     
SENATOR  TORGERSON related  his  understanding of  Representative                                                               
Green's  concern that  if, during  the  process, the  legislature                                                               
finds  that  it  is  receiving  faulty  information  because  the                                                               
contractor is working  for the Department of  Revenue rather than                                                               
the legislature, the  legislature may have to do  its own report.                                                               
Therefore, he further understood  that Representative Green would                                                               
be more up to speed on the  issue or could look "through that" as                                                               
the report  is being reviewed  if he was  one of the  people that                                                               
received the report.                                                                                                            
REPRESENTATIVE  GREEN   agreed  and  added,  "And   ...  had  the                                                               
horsepower to do it."                                                                                                           
SENATOR  TORGERSON pointed  out that  Legislative Council  always                                                               
has the horsepower  to do it.  Again,  Senator Torgerson remarked                                                               
that he  wasn't sure that  Representative Green's  amendment hurt                                                               
anything.  However,  he interpreted the amendment to  say that he                                                               
couldn't  do his  job and  thus has  to have  Legislative Council                                                               
look over  him.  On  the other hand, Senator  Torgerson commented                                                               
that  everyone should  be involved  in the  process, to  which he                                                               
didn't object.                                                                                                                  
CO-CHAIR MASEK  said that  every legislator  has the  ability and                                                               
right  to participate  in  ongoing state  issues.   Although  she                                                               
acknowledged the  need for legislators  to be involved  with this                                                               
issue, she wasn't sure how this amendment fit.                                                                                  
SENATOR TORGERSON  reiterated that the amendment  doesn't seem to                                                               
hurt  the  bill.     Furthermore,  he  noted  that   he  sits  on                                                               
Legislative  Council and  he  or  another member  of  one of  the                                                               
Resources Committees could be designated  [as a representative of                                                               
Legislative Council].   Although he contended  that the amendment                                                               
would create some complication, he  said that he didn't object to                                                               
its addition into the bill.                                                                                                     
Number 2330                                                                                                                     
REPRESENTATIVE  FATE  pointed  out  that  SB  158  has  one  more                                                               
committee of  referral.   Therefore, if  the amendment  was moved                                                               
[and  adopted], then  it would  allow Senator  Torgerson and  the                                                               
Senate Resources Committee time to review this.                                                                                 
SENATOR TORGERSON agreed  that he could then  make any objections                                                               
in the next committee of referral, the House Finance Committee.                                                                 
CO-CHAIR MASEK  noted that she  had a bit  of a problem  with the                                                               
amendment because  it seems to  cause additional time  and effort                                                               
to gather people for meetings.                                                                                                  
TAPE 01-37, SIDE B                                                                                                              
REPRESENTATIVE  GREEN posed  a  situation in  which  the two  co-                                                               
chairs and  two chairs didn't  like the direction of  the report.                                                               
He asked what Senator Torgerson would do in such a situation.                                                                   
SENATOR  TORGERSON remarked  that he  didn't know  what the  data                                                               
would be.  He highlighted the  fact that in the past, the problem                                                               
has been that [the legislature]  hasn't had the data.  Therefore,                                                               
the bill  requires [the committees]  to meet and review  the data                                                               
that is building  the report.  He stressed that  the data will be                                                               
available throughout  the process, and furthermore  there will be                                                               
periodic meetings with the contractor.                                                                                          
REPRESENTATIVE GREEN pointed out that  the data will be presented                                                               
by a  contractor who is  selected by the commissioner  as opposed                                                               
to a contractor selected by the legislature.                                                                                    
SENATOR  TORGERSON interjected,  "Well, lets  vote the  bill down                                                               
and do  it all through  Leg. Council ... if  we want to  have our                                                               
own contractor."                                                                                                                
REPRESENTATIVE GREEN said,  "That's not the point."   He withdrew                                                               
his amendment and said, "I think  we're putting our head in [the]                                                               
sand by not doing something like this."                                                                                         
Number 2278                                                                                                                     
REPRESENTATIVE  FATE moved  to report  HCS CSSB  158(O&G) out  of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal note.   There  being no objection,  HCS CSSB  158(O&G) was                                                               
reported from the House Resources Standing Committee.                                                                           

Document Name Date/Time Subjects