Legislature(1993 - 1994)

03/24/1993 03:45 PM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= 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                 
  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                 
  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-                 
  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                 
  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                 
  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                 
  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.                                                              

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