Legislature(1993 - 1994)
03/24/1993 03:45 PM RES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SENATOR MILLER called the Resources Committee meeting to order at 3:45 p.m. and announced SB 165 APPROP: ALYESKA SETTLEMENT FUND to be up for consideration. SENATOR PEARCE said this bill comes as a result of an agreement that was signed by the State and Federal Government and Alyeska Pipeline Service Company. The bill appropriates $28,200,000 to several projects around the state from the Alyeska Settlement Fund. She said since the agreement has a September 15 "drop dead date," if the legislature does not appropriate these funds, the agreement will not longer be in force. The communities who were the most affected have an opportunity for some jobs coming not only from the construction, but from the long term development. SENATOR LEMAN asked what restrictions there were on the grant to Chugach. SENATOR PEARCE answered she was interested in having the funding go as a grant to the corporation, and not go to DOTPF, because she didn't think the projects would ever get built for the amount of money that's in the agreement otherwise. PAUL FUHS, Commissioner, Department of Commerce and Economic Development, said he would feel very comfortable being the agency doing the grants. They would do it with a minimum of state overhead. He said they had already been working with several communities with their projects. Number 128 SENATOR ADAMS remarked that any money left over was to be returned to the joint trust account, yet SB 165, in Section 6 says it lapses. Where does it lapse and does this conflict with the agreement, he asked. SENATOR PEARCE said the lapse in Section 6 is "as determined by the Department of Commerce and Economic Development," because we have to follow the agreement and it would have to go back to the fund. Number 155 MICHAEL BROWN, President, Chugach Alaska Corporation, said he prepared a briefing document that is in the members' packets. Briefly, he said they believe this settlement would serve to protect the economic interest of these communities. A grant of this nature is exempt from the state procurement regulations which will allow these projects to proceed on a much faster basis and "get much more bang for the buck." They have done extensive negotiations with the village corporations of which all support this vehicle. Chugach Alaska Corporation would be in a position to guarantee that Alaska consultants, contractors, and laborers would be used on this project. Number 189 CHUCK TOTEMOFF, President, Chenega Corporation, supported the concepts in SB 165. MR. BROWN commented that if this appropriation is made, Chugach Alaska Corporation will not be a contractor doing the work in field on this. They would be in the role of a project manager. SENATOR LEMAN said there were a number of activities starting now and he asked how they were being funded - the permitting and design? MR. BROWN said that it was done in- house. Number 244 SENATOR PEARCE explained that the money flows in three separate checks and the first one has been received, but additional funding won't be coming in until next year. Number 282 ANN WIELAND, Kachemak Bay Citizens Coalition, said the $7.5 million for the purchase of inholdings within Kachemak Bay State Park, contained within SB 165 is an essential component of a funding mechanism of a purchase agreement that was negotiated through the state and the private owners of the surface, subsurface, and timber estates within Kachemak Bay State Park. It is supported by a broad spectrum of interests from tourism, recreation and timber industry representatives, conservation, commercial, charter, and sport fishing boats, native corporations and education interests. The purchase of these holdings will maintain the integrity of Kachemak Bay State Park and will restore it to its original configurations created in 1971. Number 296 JERRY MCCUTCHEON, Anchorage, said timber in the Kachemak Bay area has spruce bark beetles. The legislature needs to appropriate the money to selectively log and remove the spruce bark beetles. He advised they were buying an eyesore. Number 333 DIANE MCBRIDE, Kachemak Bay Citizens Coalition, Homer, supported SB 165. Number 372 HUGH DOOGAN, Fairbanks, said he wanted money spent for all Alaskans and not money spent for just a few. He spoke about the problems with spruce beetles. He said we needed to support the Alaskan people by turning down the Kachemak Bay buy back, because it would give people jobs to harvest the trees through selective clear cutting. He said no one should have the right to appropriate state money except the legislature. He thought a big chunk of the Exxon Valdez money should be put into an educational construction fund so we could build schools in the state of Alaska for all the state. Number 438 SENATOR PEARCE said she hoped he had an opportunity to vote on dedicating the funds for school construction next year. She said purchase of Kachemak Bay timber came under the "acquisition of equivalent resources" section of the agreement we made with Alyeska. She pointed out that we would lose all $31.5 million if we don't go forward with this bill and the agreement. Number 452 SENATOR ZHAROFF said he is dissatisfied with the Kachemak Bay buy back. He had reservations with classifying land in a protected status that has a potential of creating jobs or assisting the economy of a given area. Purchasing this timber causes a problem with availability of resource for the saw mill that's open in that part of the state. SENATOR PEARCE said so far the trustees have spent almost $200 million doing assessments and the six of them approve the Kachemak Bay buy back. SENATOR ZHAROFF said the trustees have secure jobs and are well secured in their retirements. The current plant has approximately 100 people employed and they want to add another 150 people. He asked if Senator Little had been contacted regarding this legislation. SENATOR PEARCE said she and her staff are fully agreed with this legislation. SENATOR ADAMS asked what the Department of Law's position was on this legislation. SENATOR PEARCE said they are supportive. SENATOR ADAMS asked if we are setting a precedent for utilizing capital projects for the purchase of land. SENATOR MILLER said the Commissioner of the Department of Commerce and Economic Development would probably not consider it so. Number 515 SENATOR PEARCE moved to pass SB 165 from committee with individual recommendations. There were no objections and it was so ordered.