Legislature(2011 - 2012)BELTZ 105 (TSBldg)

01/31/2012 03:30 PM COMMUNITY & REGIONAL AFFAIRS


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Bills Previously Heard/Scheduled TELECONFERENCED
= SB 122 REAL ESTATE TRANSFER FEES/TITLE PLANTS
Moved CSSB 122(CRA) Out of Committee
= SB 154 NATURAL GAS CONVERSION PROGRAM/FUND
Moved SB 154 Out of Committee
           SB 154-NATURAL GAS CONVERSION PROGRAM/FUND                                                                       
                                                                                                                                
CHAIR OLSON announced the consideration of SB 154.                                                                              
                                                                                                                                
3:34:43 PM                                                                                                                    
SENATOR JOE THOMAS, SB 154 sponsor,  said the bill would create a                                                               
low interest loan  program for Alaskan families  to replace their                                                               
oil,  coal  or  wood  home-heating appliances  with  natural  gas                                                               
fueled appliances.  He said  families would  have the  ability to                                                               
plan ahead  for low cost  energy, knowing  that when they  do get                                                               
access to natural gas in  their neighborhoods or communities they                                                               
will be able to afford to use it.                                                                                               
                                                                                                                                
He  said the  home heating  change-out mechanism  would create  a                                                               
more robust gas distribution system  in Southcentral Alaska where                                                               
gas is currently distributed. He  said Fairbanks would be able to                                                               
prepare for delivery of natural  gas either by pipeline or truck.                                                               
He  said  the Fairbanks  Borough  was  studying the  options  and                                                               
economics  of  expanding  the  current  gas  distribution  system                                                               
beyond the  current 1100  customers to over  3500 customers  in a                                                               
relatively  short  period  of  time.  He said  he  had  a  recent                                                               
discussion  with Fairbanks  Natural Gas  and was  told that  over                                                               
2000 homes in Fairbanks are  within reach of the current pipeline                                                               
infrastructure.                                                                                                                 
                                                                                                                                
He said  heavier use of  gas in  Fairbanks would also  assist the                                                               
borough in  complying with the Environmental  Protection Agency's                                                               
(EPA)  air quality  mandate when  12,000 homes  are converted  to                                                               
natural gas.                                                                                                                    
                                                                                                                                
3:36:31 PM                                                                                                                    
SENATOR THOMAS  He said by  implementing SB 154  and establishing                                                               
the natural gas  home heating conversion loan  fund, upgrading to                                                               
cleaner, cheaper  gas will become  affordable for  more families,                                                               
making any gas  delivery project much more economic.  He said the                                                               
economy would be  vitalized by job creation across  the state and                                                               
more money  would circulate within  Alaska rather than  on energy                                                               
expenditures.                                                                                                                   
                                                                                                                                
3:37:52 PM                                                                                                                    
GRIER HOPKINS,  staff to  Senator Thomas,  said he  was available                                                               
for questions.                                                                                                                  
                                                                                                                                
CHAIR OLSON asked  what the plans were for extending  some of the                                                               
services in Fairbanks.                                                                                                          
                                                                                                                                
SENATOR  THOMAS   answered  that  Fairbanks  Natural   Gas  would                                                               
continue  to address  distribution logistics  and infrastructure.                                                               
He  said  Golden  Valley Electric  Association  and  Flint  Hills                                                               
Resources' North  Pole Refinery could offer  the Fairbanks market                                                               
with excess natural gas from their Prudhoe Bay shipments.                                                                       
                                                                                                                                
CHAIR OLSON asked  if Fairbanks residents would  pay higher taxes                                                               
due to the added infrastructure costs.                                                                                          
                                                                                                                                
SENATOR THOMAS answered no.                                                                                                     
                                                                                                                                
SENATOR  WAGONER  commented  that   SB  154  would  benefit  both                                                               
Fairbanks  and other  areas in  the state  that have  natural gas                                                               
availability.                                                                                                                   
                                                                                                                                
CHAIR  OLSON  asked if  Senator  Wagoner's  constituents were  in                                                               
favor of SB 154.                                                                                                                
                                                                                                                                
SENATOR WAGONER replied that he did  not know, but said he was in                                                               
favor of SB 154.                                                                                                                
                                                                                                                                
CHAIR OLSON  commented that SB  154 had  a large fiscal  note and                                                               
answers were required.                                                                                                          
                                                                                                                                
3:40:47 PM                                                                                                                    
SENATOR  WAGONER said  money  would  come back  to  the state  in                                                               
future years.                                                                                                                   
                                                                                                                                
CHAIR OLSON asked how the money would come back to the state.                                                                   
                                                                                                                                
SENATOR WAGONER answered that the  money appropriated was a loan,                                                               
not a grant.                                                                                                                    
                                                                                                                                
CHAIR OLSON  asked about  a return on  investment at  one percent                                                               
interest.                                                                                                                       
                                                                                                                                
SENATOR THOMAS answered that the  loans within the program are at                                                               
one percent interest to be repaid over a ten-year period.                                                                       
                                                                                                                                
SENATOR WAGONER  confirmed that  the loan is  at one  percent and                                                               
the principle would be paid back.                                                                                               
                                                                                                                                
3:41:20 PM                                                                                                                    
SENATOR KOOKESH  moved to report  SB 154 from the  committee with                                                               
individual recommendations and attached fiscal note(s).                                                                         
                                                                                                                                
3:41:33 PM                                                                                                                    
CHAIR OLSON  announced without objection,  SB 154 moved  from the                                                               
Senate Community and Regional Affairs Standing Committee.                                                                       
                                                                                                                                

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