Legislature(2007 - 2008)BARNES 124
07/15/2008 08:00 AM House COMMUNITY & REGIONAL AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB4002 | |
| HB4003 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB4002 | TELECONFERENCED | |
| += | HB4003 | TELECONFERENCED | |
ALASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS STANDING COMMITTEE
July 15, 2008
8:01 a.m.
MEMBERS PRESENT
Representative Anna Fairclough, Co-Chair
Representative Gabrielle LeDoux, Co-Chair
Representative Nancy Dahlstrom
Representative Mark Neuman
Representative Sharon Cissna
Representative Woodie Salmon
MEMBERS ABSENT
Representative Kurt Olson
OTHER LEGISLATORS PRESENT
Representative Mike Kelly
Representative Peggy Wilson
Representative Bryce Edgmon
Representative Andrea Doll
Representative Kyle Johansen
Representative Beth Kerttula
COMMITTEE CALENDAR
HOUSE BILL NO. 4002
"An Act establishing the Alaska resource rebate program and
relating to the program; and providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 4003
"An Act making supplemental appropriations to the Alaska Energy
Authority for power cost equalization; making special
appropriations to the Department of Revenue and to the
Department of Health and Social Services for the Alaska resource
rebate program; making a special appropriation to the Department
of Revenue for the payment of certain shared taxes relating to
aviation fuel; and providing for an effective date."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: HB4002
SHORT TITLE: RESOURCE REBATE PROGRAM FOR RESIDENTS
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
07/09/08 (H) READ THE FIRST TIME - REFERRALS
07/09/08 (H) CRA, FIN
07/11/08 (H) CRA AT 8:00 AM BARNES 124
07/11/08 (H) Heard & Held
07/11/08 (H) MINUTE(CRA)
07/15/08 (H) CRA AT 8:00 AM BARNES 124
BILL: HB4003
SHORT TITLE: APPROP: ENERGY RELIEF/REBATE/FUEL TAX
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
07/09/08 (H) READ THE FIRST TIME - REFERRALS
07/09/08 (H) CRA, FIN
07/11/08 (H) CRA AT 8:00 AM BARNES 124
07/11/08 (H) Heard & Held
07/11/08 (H) MINUTE(CRA)
07/15/08 (H) CRA AT 8:00 AM BARNES 124
WITNESS REGISTER
RANDY RUARO, Special Staff Assistant
Office of the Governor
Juneau, Alaska
POSITION STATEMENT: Presented HB 4002 on behalf of the
governor.
JERRY BURNETT, Legislative Liaison/Director
Administrative Services Division
Department of Revenue
Juneau, Alaska
POSITION STATEMENT: Provided a sectional analysis of HB 4002.
MICHAEL MITCHELL, Senior Assistant Attorney General
Civil Division (Anchorage)
Department of Law (DOL)
Anchorage, Alaska
POSITION STATEMENT: During hearing of HB 4002, answered
questions.
CHRISTOPHER POAG, Assistant Attorney General
Commercial/Fair Business Section
Civil Division (Juneau)
Department of Law (DOL)
Juneau, Alaska
POSITION STATEMENT: During hearing of HB 4002, answered
questions.
SARA FISHER-GOAD, Deputy Director
Operations
Alaska Energy Authority (AEA)
Anchorage, Alaska
POSITION STATEMENT: Testified during the hearing on HB 4002 on
behalf of AEA.
KAREN J. REHFELD, Director
Office of Management & Budget
Office of the Governor
Juneau, Alaska
POSITION STATEMENT: Testified during the hearing on HB 4003.
SARA FISHER-GOAD, Deputy Director
Operations
Alaska Energy Authority (AEA)
Anchorage, Alaska
POSITION STATEMENT: Answered questions during the hearing on HB
4003.
RANDY RUARO, Special Staff Assistant
Office of the Governor
Juneau, Alaska
POSITION STATEMENT: During hearing of HB 4003, answered
questions.
ACTION NARRATIVE
CO-CHAIR ANNA FAIRCLOUGH called the House Community and Regional
Affairs Standing Committee meeting to order at 8:01:29 AM.
Representatives Fairclough, LeDoux, Dahlstrom, Neuman, and
Salmon were present at the call to order. Representative Cissna
arrived as the meeting was in progress. Also in attendance were
Representatives Kelly, Wilson, Doll, Edgmon, Johansen, and
Kerttula.
HB4002-RESOURCE REBATE PROGRAM FOR RESIDENTS
8:01:56 AM
CO-CHAIR FAIRCLOUGH announced that the first order of business
would be HOUSE BILL NO. 4002, "An Act establishing the Alaska
resource rebate program and relating to the program; and
providing for an effective date."
8:02:29 AM
REPRESENTATIVE NEUMAN expressed interest in hearing from the
administration regarding a long-range [energy] plan for Alaska.
He then expressed concern with the $1,200 rebate because he said
he believes that in four to five years the state will be in a
deficit situation. He said he's very uncomfortable with putting
out cash for this rebate with the possibility of having to
charge an income tax or take people's permanent fund dividends
(PFDs) away in four to five years.
8:03:27 AM
CO-CHAIR FAIRCLOUGH noted that she has provided the committee
with a legal opinion regarding the eligibility requirements and
constitutionality of preserving the permanent fund.
8:03:50 AM
RANDY RUARO, Special Staff Assistant, Office of the Governor,
stated that HB 4002 is important legislation for Alaskans as it
would share a $1,200 one-time special payment per person. Mr.
Ruaro said that the state can afford this special one-time
payment because oil prices have more than doubled from $70 a
barrel in July 2007 to record levels of $145 a barrel at the
start of business today. The $1,200 payment per person
represents a fraction of the state's expected surplus revenue
for fiscal year (FY) 2009. Mr. Ruaro highlighted that when oil
prices are high, Alaskans are faced with high prices for many
consumer products. Therefore, the timing of payment is
particularly helpful. The administration, he related, is
prepared to make the proposed payment quickly as the Division of
Finance believes it can issue the checks to those found by the
Permanent Fund Division to qualify for a 2008 permanent fund
dividend (PFD). The aforementioned group amounts to
approximately 620,000 Alaskans. Mr. Ruaro then pointed out that
there are a number of federal laws that impact Alaskans
receiving federal benefits, such as the Food Stamp program,
Adult Public Assistance, and Veterans' Administration benefits.
The legislation has taken steps to hold those Alaskans harmless
such that they will receive the payment. He noted that the hold
harmless provisions in HB 4002 are a bit broader than those in
the permanent fund statutes as disabled veterans and veterans
over age 65 receiving a pension are held harmless.
8:07:52 AM
JERRY BURNETT, Legislative Liaison/Director, Administrative
Services Division, Department of Revenue (DOR), explained that
Section 1 sets out the Alaska resource rebate program and the
amount of $1,200. Section 1 also provides the opportunity for
people to elect not to receive a payment under the program. The
program is established in the Department of Revenue (DOR).
There are two classes of recipients: those who receive the 2008
PFD and those who are residents as of April 1, 2008, through the
application period in October 1 through November 30, 2008. The
latter class then has a six-month residency requirement and
those applicants have to provide proof identity, residency, and
have two people verify the applicant was in the state during the
required timeframe. Section 1 specifies the various ways in
which an individual can verify his/her residency and identity.
The section also provides for how a parent or guardian provides
identification of their children and that they, in fact, are the
parent or legal guardian of the child. He pointed out that
Section 1 also includes the hold harmless provisions mentioned
earlier. Section 2 repeals the legislation June 30, 2009, and
Section 3 is an immediate effective date.
MR. BURNETT then addressed how the program would be administered
should it pass. He explained that DOR takes PFD applications
during the period of January through March each year. About
643,000 applications came in this year, at this point the
department has determined that approximately 580,000 are
eligible. If HB 4002 passed now, some time in August the
department would send a computer tape to Finance for those
already determined eligible, which he estimated to be
approximately 600,000. Those checks would be sent out in
August. For the remaining 10,000-20,000 Alaskans who will
ultimately qualify for the PFD, the checks would continue to be
sent out on a bi-weekly basis as folks are deemed to qualify.
Prior to the 1st of October, an application form would be
developed and available on the Internet and in various state
offices and other locations. Once those are received during the
October application period, the applications would be verified
and checks sent out on a weekly basis. He estimated that
35,000-50,000 people are expected to qualify under the six-month
provision.
8:12:53 AM
MR. BURNETT, in response to Co-Chair LeDoux, pointed out that
the fiscal note estimates that 45,000 individuals who didn't
apply for the PFD would qualify under the six-month provision.
CO-CHAIR LeDOUX inquired as to the rationale behind providing
this resource rebate to folks who don't qualify for the PFD.
MR. BURNETT said that a number of Alaskans don't apply for the
PFD. Furthermore, a number of individuals live in Alaska but
don't receive the PFD because they're meet the residency
requirements of the PFD. There are also a number of people who
have moved to Alaska, have lived in Alaska for the summer, and
will live in Alaska in the winter, and thus would legitimately
qualify for this program as it's envisioned.
8:14:03 AM
CO-CHAIR LeDOUX posed a scenario in which an individual lives in
Alaska and qualifies for the PFD, but hasn't applied for the
PFD. She questioned whether such an individual would be
eligible for the proposed resource rebate.
MR. BURNETT answered that such an individual wouldn't be
eligible since he/she hadn't applied for the PFD and wouldn't be
on the list of eligible Alaskans. One of the qualifications for
an Alaska PFD is that one must make application during the
specified period.
8:15:04 AM
REPRESENTATIVE NEUMAN inquired as to whether there's a system
for garnishments for child support or traffic fines.
MR. BURNETT explained that under the PFD program, garnishments
from all state agencies and private servers are accepted.
However, this legislation doesn't allow for garnishments of the
[resource rebate] checks by the state. In order to [distribute
these checks] in an expeditious manner, it's practically
impossible to do garnishments, particularly garnishments from
private servers. Furthermore, the Internal Revenue Service
(IRS) likely won't garnish the resource rebate checks, although
it does garnish the PFD checks.
8:17:14 AM
CO-CHAIR FAIRCLOUGH asked if [garnishments] would be possible if
the PFD distribution in October was used [for all individuals].
She inquired as to why a duplicative process at a cost of $.5
million is being used.
MR. BURNETT answered that it would be technically feasible [to
distribute the resource rebate under the PFD and provide for
garnishments].
MR. RUARO interjected that it's partly a legal question and a
question of the Permanent Fund Division's administrative ability
to make garnishments and distribute the PFD on time. There is a
legal question in regard to blending the proposed special one-
time payment with an ongoing program which is the cause for some
hesitation.
8:19:19 AM
CO-CHAIR LeDOUX remarked that she has some real problems with
not being able to garnish for child support. Therefore, she
inquired as to what can be done to address that.
MR. RUARO said that the administration can review and work on
this issue. As mentioned earlier, one of the main purposes is
to get the payment to Alaskans quickly.
8:19:56 AM
CO-CHAIR LeDOUX asked if performing garnishments would be
facilitated by having a limited time in which an applicant can
report the names of those to whom the applicant owes child
support.
MR. BURNETT highlighted that DOR administers both child support
and the PFD. Therefore, DOR has the information about child
support, although it's not put together until it does the PFD
distribution. Mr. Burnett related his understanding that [the
garnishments] aren't a large technical issue, rather they were a
policy choice that both parties would need the money.
CO-CHAIR LeDOUX surmised then that there wouldn't be any
technical difficulties with changing the legislation to allow
garnishments of the resource rebate program in the case of child
support debt.
MR. BURNETT said that although child support is probably the
easiest [garnishment], private garnishments would be nearly
impossible to do in a short period of time - even if done in
conjunction with the PFD check.
8:22:04 AM
CO-CHAIR FAIRCLOUGH expressed concern with regard to the urgency
tied with a resource rebate versus the urgency of an energy
supplement. Co-Chair Fairclough said she understood when the
administration was moving quickly regarding an energy rebate
when rural Alaska had shipments of fuel that needed to come in
by barge. However, she related that she has less sensitivity to
the aforementioned under a resource rebate that doesn't allow
the collection of funds from those who have obligations to pay
others.
8:22:56 AM
REPRESENTATIVE NEUMAN expressed hope that the administration
develops proposals to address the aforementioned. He then asked
whether the legislation includes a [process] for those who don't
receive the resource rebate but believe they are eligible to
contest that.
MR. BURNETT answered that the legislation specifies a formal
appeals process that goes through the Office of Administrative
Hearings.
8:23:54 AM
REPRESENTATIVE DAHLSTROM inquired as to whether the
administration has taken any steps to address veterans or senior
citizens who might be on income-based programs and may be
negatively impacted by the proposed resource rebate.
MR. RUARO informed the committee that the [administration] has
reviewed the hold harmless issues and contacted the Veterans
Administration (VA). He highlighted that the legislation holds
harmless several different veterans' programs that were found to
be impacted by income and thus would be impacted by [the
proposed] payment. For seniors, the legislation specifies that
those seniors receiving any state benefit are held harmless.
Therefore, those seniors receiving any state-administered
benefit would be held harmless.
8:25:32 AM
MR. BURNETT, in response to Representative Salmon answered that
there was no intent to mail out an application to every Alaskan.
In this case, the intent would be to inform people [who don't
qualify for the PFD and thus don't qualify for the proposed
resource rebate program] of the application period through
advertising. The group [that does not qualify for the PFD and
thus does not qualify for the proposed resource rebate program]
is a smaller group of individuals, and therefore it doesn't make
sense to send an application to every Alaskan. In further
response to Representative Salmon, Mr. Burnett confirmed that
those who don't live in Alaska, but who qualify for and receive
the PFD will qualify for the proposed resource rebate program.
8:26:51 AM
CO-CHAIR FAIRCLOUGH inquired as to whether this legislation
creates, through its eligibility requirements, a new residency
requirement.
MR. RUARO explained that there are two eligibility pools: 1)
everyone who qualifies for the 2008 PFD, which amounts to about
620,000 residents; 2) those estimated 30-40,000 who don't apply
or aren't found to qualify for the PFD. The second eligibility
pool consist of people such as veterans who don't apply for the
PFD because it isn't held harmless.
8:28:34 AM
CO-CHAIR FAIRCLOUGH recalled that the July 11, 2008, memorandum
from Legislative Legal Services relates that Alaska has
different residency requirements for various programs. The
proposed resource rebate has a specific set of residency
requirements that would be unique to the program. Therefore,
she questioned whether the difference in eligibility
requirements would result in a challenge to those residency
requirements in the future.
8:29:33 AM
MICHAEL MITCHELL, Senior Assistant Attorney General, Civil
Division (Anchorage), Department of Law (DOL), said that he
hasn't seen the aforementioned memorandum, and therefore he
couldn't comment.
8:30:15 AM
MR. RUARO stated his agreement that there are many different
residency requirements in various programs and the legislature
can select from those.
8:31:07 AM
CHRISTOPHER POAG, Assistant Attorney General, Commercial/Fair
Business Section, Civil Division (Juneau), Department of Law
(DOL), informed the committee that the lead attorney from DOL is
Mike Barnhill, who is away on a family emergency. He explained
that the PFD residency requirements include a one-year physical
residency with allowable absences. There is a general allowable
absence for every Alaskan that allows every Alaskan to be absent
from the state for up to 180 days. Therefore, it's more of a
185-day residency requirement. The resource rebate program
doesn't include all the allowable absences specified for the PFD
as it would be complicated and hard to administer. Although the
residency requirements in HB 4002 are akin to those of the PFD,
Mr. Poag noted his agreement with Ms. Cook's opinion in the
aforementioned memorandum that this legislation is a different
program, an interim program that is established in uncodified
law. The proposed program has its own purposes and residency
requirements, both of which are slightly different from the PFD.
To the extent there is concern with regard to a challenge to the
proposed program, Mr. Poag related that DOL is ready to defend
an attack on the proposed program as well as the PFD program.
As members are likely aware, the Alaska Supreme Court has faced
a number of challenges the DOL has defended and very good
precedence on the PFD program has been received.
8:32:44 AM
REPRESENTATIVE NEUMAN related his understanding that those who
have already applied for the PFD, don't need to reapply for the
proposed resource rebate.
MR. POAG replied yes, adding that it's nice to immediately build
in applications and eligibility for roughly 600,000 Alaskans.
Those who applied for the [PFD] but who were found ineligible
for the PFD can apply for the resource rebate.
8:34:06 AM
CO-CHAIR FAIRCLOUGH recalled testimony that the proposed rebate
program is slightly different than PFD in regard to how it would
be defended. She said that under an energy plan she understood
the urgency to meet the energy need of the state. Under the
energy need, Co-Chair Fairclough said she has questions
regarding those out-of-state individuals who qualify. She then
inquired whether the residency requirements for the resource
rebate is jeopardizing the PFD or providing an argument [for a
challenge]. "The permanent fund," she said, "holds Alaska's
resource wealth specifically, and we are distributing Alaska's
resource wealth in the same manner." If it's different, she
inquired as to how it's different, because it's Alaska's
resource wealth.
MR. POAG opined that energy relief is a need that the entire
state will experience and because it's more of a needs-based
category, it receives different scrutiny from the Alaska Supreme
Court and the U.S. Supreme Court. Needs-based things seem to be
viewed as a basic necessity of life and should be treated
differently. Mr. Poag then informed the committee that the PFD
program faced challenges in three different cases. The Alaska
Supreme Court determined that the PFD has three principle
purposes: 1) distribute the Alaska's oil and gas wealth to
Alaskans; 2) reduce population turnover; 3) encourage permanent
residents to have an interest in how the state's resources are
distributed or utilized. Therefore, the proposed resource
rebate program is more akin to the PFD because it is based on
the last five fiscal years. Although there has been a sharp
increase in the price of oil, that five-year lag creates a
situation in which the state's coffers fill while the PFD's
coffers are stagnant. He opined that the interim resource
rebate provides an opportunity to give those funds back to the
residents to acknowledge the five-year lag and share the state's
oil wealth. Therefore, it's not energy relief, it's a resource
rebate. As a resource rebate, much like the PFD, it's
different, isn't needs-based, but rather says that Alaska
residents are entitled to a PFD because of the aforementioned
three principles. Because [the resource rebate program]
achieves those three principles, the short or limited durational
residency requirements that the basic necessity of life would
have required are not necessary.
8:38:00 AM
CO-CHAIR LeDOUX inquired as to whether those in an institution
are eligible to receive this resource rebate.
MR. POAG replied yes, if the resident of the institution has a
legal guardian or a representative who can file on the
individual's behalf. Residents of an institution who have their
legal authority would be able to apply on their own behalf. In
further response to Co-Chair LeDoux, Mr. Poag pointed out that
there is language in the bill - [on page 2, lines 25-26,
referring to AS 43.23.005(d)] - which specifies that an
individual is deemed ineligible for the PFD if he/she has a
felony conviction, a felony conviction tied to jail time, or a
two-time misdemeanor conviction.
8:40:15 AM
CO-CHAIR LeDOUX, regarding the provision that would require a
physical address [on page 3, line 8], expressed concern that the
physical addresses of many of her constituents are not printed
anywhere.
MR. POAG pointed out that in subsection (g), on page 3, lines 6-
18, there are listed as many types of indicators of Alaska
residency as possible. He said he believes a voter registration
card alone would suffice, although he said the department would
be open to other suggestions.
CO-CHAIR LeDOUX suggested that a paragraph could be added to
include "other substantial proof of physical presence."
MR. POAG suggested that removing the word "physical" and just
using the term "residence address" may alleviate Co-Chair
LeDoux's concern.
CO-CHAIR LeDOUX said it might.
8:43:03 AM
CO-CHAIR FAIRCLOUGH directed attention to page 3, line 15, and
remarked that a check stub doesn't really establish residency;
therefore, it appears that the intent of the proposed
legislation is that a seasonal worker who is here "under the
timeframe and leaving" would qualify.
MR. POAG reminded Chair Fairclough that there are three
criteria, the third of which is found on page 3, line 5, and
would require the person to indicate, under penalty of perjury,
that he/she "intends to maintain a home in the state." If the
person declares falsely and receives the check, he/she would
have stolen money from the state.
8:44:43 AM
REPRESENTATIVE CISSNA observed that uninsured people make up one
of the neediest groups. She said Alaska is unique because it
has a huge population of those who work seasonally and live an
itinerate lifestyle. She suggested that there may be "a hole in
... what we're doing to identify ... the people who don't have
addresses." She noted that she once lived in a fish camp that
had no physical address. Representative Cissna talked about the
difference between a resource rebate and a crisis rebate, and
inquired as to differences between those two. She said a
question for the Department of Revenue would be why a switch was
made from one to the other, what the implications are
surrounding that change, and whether or not "we" should be
thinking about that.
MR. POAG said Representative Cissna is right that Alaska has a
group of people who spend part of the year in the state and part
elsewhere; however, as long as those people are [in Alaska] for
185 days, and Alaska is their home, they qualify for the PFD.
He noted that the proposed bill has a 180-day residence
requirement.
MR. POAG observed that Representative Cissna seems to be
indicating a concern that the resource rebate may have the
unintended consequence of leaving folks who have a need but
don't meet the criteria without the dividend. He said, "That's
a policy call for you folks to make." If the bill were to
provide energy relief, he said, it would be drafted differently,
because relief is focused on a person's basic necessities, such
as food and shelter. A legislative decision would have to be
made that all Alaskans actually need that relief.
MR. POAG said he understands from the administration's position
that [HB 4002] proposes a resource rebate, much like the PFD,
but acknowledges that current oil prices have resulted in the
state coffer filling up while the rate of the PFD has not
changed. The proposed legislation would offer a resource rebate
to Alaskans - not based on need and "not necessarily designed to
catch that concern that you have." Mr. Poag suggested that the
Department of Revenue or the administration address
Representative Cissna's policy concern.
8:49:20 AM
CO-CHAIR FAIRCLOUGH questioned why the state would spend $.5
million to distribute the money 30 days early when there is a
system already in place that could handle a distribution of a
resource rebate. She said it seems inefficient to set up a
separate department to handle a one-time rebate.
MR. POAG offered an explanation from a legal perspective. He
said applicants apply for a certain benefit, and if the
legislature changes that benefit midstream, it may be necessary
to reopen the application process and redetermine eligibility.
The due process interests change, he said. He stated, "I think
there are ways to do what you're referring to, but I don't know
that there's a way to do it and tie it to the 2008 PFD
eligibility without a separate application process. He
suggested there may be some who would apply for the "super PFD"
who did not apply for the original PFD, or perhaps there would
be some who fight harder when told they are ineligible. He
concluded, "I think this is ... a middle solution that sort of
addresses both of those concerns, that those that are deemed
eligible for the 2008 dividend are built into this, but then we
have a supplemental application process to catch those folks
that fall through the cracks."
CO-CHAIR FAIRCLOUGH mentioned that there has been challenge of a
six-month period related to a rebate program by the
administration, and she questioned whether there could be a
challenge that "we don't have a short enough time period."
MR. POAG said the state could be challenged; plaintiffs'
attorneys exist that are ready to put together class action
suits at any time. However, he noted that the PFD program has
thus far survived any Alaska Supreme Court challenges. He said
he thinks the concern being referenced by Co-Chair Fairclough
comes from the United States Supreme Court decision, Sans v Roe,
which marks a change in how the courts have dealt with
durational residence requirements. Under the old system, the
court seemed to be reacting to the facts before them and making
decisions that made sense to them. The old test, he said, used
to be whether or not the conditioning of a benefit on a certain
period of residency "penalized or burdened the right to travel."
The focus always seemed to be on what the benefit was that was
being handed out. The court determined that if that benefit is
a basic necessity of life, the durational residence requirement
must be short, because "those are important interests that
residents need to get." However, Mr. Poag relayed, the court
has routinely acknowledged, in footnotes and in dicta, that that
holding does not apply to other types of benefits.
MR. POAG mentioned a court case in which the issue of portable
benefits was addressed. He referenced another case in which the
court said it thinks the PFD qualifies as a portable benefit.
Mr. Poag explained that a portable benefit is much like instate
college tuition. If a student goes out of state and qualifies
for instate tuition, then comes back to Alaska and utilizes
his/her education in Alaska, he/she has gotten a benefit from
the State of California, but has utilized the benefit in Alaska.
So, in an Alaska Supreme Court case, the PFD was seen as a cash
portable benefit; a person could move to Alaska, live for the
requisite time period, and take the benefit home to his/her home
state and consume that benefit. As a result, Mr. Poag said, "We
qualify for that exception." He said, "And if someone takes us
to the U.S. Supreme Court, much like if they brought the PFD to
the U.S. Supreme Court, we would defend this on that exception."
8:55:15 AM
REPRESENTATIVE SALMON directed attention to language on page 2,
line 27, which would require a physical address and telephone
number be provided with the application. He indicated that he
finds the requirement for the physical address to be
problematic, and he asked for an explanation of why a telephone
number would be required.
MR. POAG clarified that Representative Salmon was referring to
the "verifier requirement." He explained, "In a desire to come
up with easy, administratively practicable measures to implement
the verifier residency, we put the verifiers in this bill." He
said the telephone number is a good means by which the
department can contact someone; however, he said if people do
not have telephone numbers, he is sure the bill could be drafted
in a way that that requirement would be an alternate or optional
piece of information to provide. Mr. Poag pointed out, "There
is an appeals process here, and a lot of these issues would
probably get ferreted out or worked out in the appeals process."
He said he thinks it is the goal to "get this resource relayed
back to Alaskans."
8:57:24 AM
CO-CHAIR LeDOUX, regarding the durational residency requirement,
offered her understanding that [the proposed rebate] will be
more likely to "pass constitutional muster" if given out to
everyone, than it would be if it was turned into a needs-based
program.
MR. POAG replied that although the answer is slightly more
complicated, in essence Co-Chair LeDoux is correct.
8:58:05 AM
CO-CHAIR LeDOUX, regarding incarceration, asked if AS
43.23.005(d) is the statute that would specifically exempt
people who are in penal institutions.
MR. POAG answered that is correct, and noted that Co-Chair
LeDoux is referencing language on page 2, lines 25-26.
8:58:32 AM
CO-CHAIR LeDOUX asked what the rationale would be to allow
someone in another type of institution to collect an energy
rebate if that person is not actually being impacted by [the
high energy costs].
MR. POAG responded that if the purpose of the bill is to provide
energy relief, and some people were not experiencing "energy
needs," then "we would probably want to draft it to rule out
those individuals from receiving it if there was a way to do so
that was administratively practicable."
8:59:43 AM
REPRESENTATIVE NEUMAN, regarding the super dividend, addressed
his concern that additional state funds would be spent in order
to service this program, and he recounted that the reason the
proposed rebate could not be folded into the already existing
PFD is because "it was separate." He recollected that Mr. Poag
had brought up disaster relief for Hurricane Katrina. He asked
Mr. Poag if he had based "any of this stuff" on law that was
addressed during Hurricane Katrina for purposes of comparison,
or if the language before the committee is all new.
MR. POAG responded that Mike Ford shared in the drafting of the
bill, along with himself and others in the Department of Law.
He clarified that the language was not based on a Hurricane
Katrina program, but was based essentially on the PFD program
and other state programs that offer rebates or benefits. The
language was essentially created for this need.
9:01:27 AM
REPRESENTATIVE CISSNA, returning to Representative Salmon's
prior remarks, noted that Representative Salmon's constituents
live in remote Alaska. She observed that urban Alaska has a lot
of uninsured citizens, but in rural Alaska, those numbers are
multiplied. Phones are rarer outside of urban areas, she
observed. She said discussion began with talk about energy, but
has switched to "the resource," and she stated her desire to
focus on who the legislature is really trying to help and why.
MR. POAG said since he heard no legal component to
Representative Cissna's question, he would prefer to defer it to
the administration.
CO-CHAIR FAIRCLOUGH said the committee hopes to hear back from
Mr. Poag regarding finding a middle ground for remote and rural
Alaska regarding the issue of the telephone numbers and physical
addresses.
9:04:21 AM
CO-CHAIR LeDOUX asked if it would be possible to send out a
notice that those who were ineligible for the PFD would have a
specific timeframe in which to apply for the rebate, thus making
the requirement "exactly identical" and enabling the state to
fold the rebate into the PFD, save the extra $500,000, and avoid
constitutional issues or legal difficulties.
MR. POAG answered that he thinks there probably is a way to
"renotice" the 2008 dividend, such that the due process concerns
he has could be dealt with properly. However, there are
concerns about constitutionality, and he noted that Co-Chair
Fairclough had mentioned a concern about a challenge to the
resource rebate program. He said, "If we make this a PFD
program, there will be a challenge to the PFD program." He
encouraged the committee to think about that as it moves forward
with the bill discussion.
CO-CHAIR LeDOUX said she does not understand why, if the
qualifications were made "exactly identical," the result would
be a challenge, because the PFD program has successfully managed
to avoid challenges.
MR. POAG answered that Co-Chair LeDoux is correct that,
practically speaking, there should be no difference. If the
programs are identical but separate, there would be no concern;
however, if the two programs were merged, then there would be an
attack on the PFD program, rather than an attack on the resource
rebate program.
CO-CHAIR LeDOUX asked Mr. Poag, "Would the attack be any more
likely to be successful than any of the other attacks?" She
reiterated that [the PFD program] has pretty well withstood
constitutional challenge.
MR. POAG answered, "You're correct. It's just we would be
defending the PFD program instead of the research rebate
program; that's the only distinction."
9:07:13 AM
CO-CHAIR FAIRCLOUGH said she would like an administrative
response to the subject of Alaskans beginning to hear the call
for energy relief. She said she would also like to hear whether
or not the administration is in favor of the percent of market
value (POMV) that "died years ago." She questioned if the "5
percent payout method" would have solved the problem, and if the
resource rebate is a means for "backdooring a POMV." She
clarified that she is talking about a higher than average
return, not the government's spending money. She said she would
like a description of the difference between an energy rebate
and the resource rebate that has been presented to the
committee.
MR. RUARO responded that the key distinction to make is between
the foundation for the payment and the circumstances that
Alaskans are facing regarding inflation and high energy prices.
He said the foundation for the payment is "a sharing of the
state's resource wealth on an equal basis, which is based on the
concept enshrined in Article 8 of the state's constitution that
the people are the true owners of the state's resources. He
specified, "The distinction - and it's an important one - is
that the basis for the payment is an equal distribution of
excess wealth." He said it is not surprising that "that ...
could happen to occur when Alaskans are also facing a lot of
energy issues, as it's the price of oil [that] is the common
factor to both."
9:11:23 AM
REPRESENTATIVE DAHLSTROM expressed appreciation of the
administration's willingness to review the garnishment issue, as
well as its willingness to consider "some different possible
aspects of that" in a committee substitute. Furthermore, she
said she shares concerns that have been broached regarding the
cost of distributing the check, and she said she hopes there
will be continued consideration of more creative ways to lower
that cost.
9:11:57 AM
CO-CHAIR FAIRCLOUGH observed that although every Alaskan is
suffering because of the increased cost of energy, rural and
remote Alaskans face different, more immediate energy needs than
those in urban Alaska. They have higher prices than urban
Alaska does already; therefore, those areas are being
disproportionately hurt. She questioned whether the legislature
should address the energy component factor that is different or
stick with the administration's flat distribution, which is less
likely to be legally challenged.
MR. RUARO acknowledged that there is a difference, but pointed
out that there are widely available programs that have been in
place for years, such as the Low Income Home Energy Assistance
Program (LIHEAP). He said [the resource rebate] is a single
tool in the toolbox and designed to be distributed on an equal
basis - a fact he said he thinks is very important. He relayed
his hope that those individuals in the [rural and remote] areas
will avail themselves of any means available [to lessen the
effect of increased energy costs].
9:14:42 AM
CO-CHAIR FAIRCLOUGH said she thought she was here to address
energy needs, and while the $1,200 may impact a family
positively today, she questioned how the legislature is looking
to the future. She said she accepts that the state has money at
this point in time, greater than anticipated. She said she is
battling with returning those resources into the pockets of
Alaskans while understanding that there is an enormous, long-
term energy need to address. She echoed Representative Cissna's
previously stated question about why the legislature is here -
to address energy matters or a super PFD.
9:16:05 AM
REPRESENTATIVE CISSNA said she was aware that a severe energy
need existed before she came to the regular session. There is a
sharp divide between what's going on in Alaska and what's
happening in the capitol. She stated that it is upsetting that
the state has enough money right now to actually do some
critical things that could help Alaskans long term. She said
she understands that [HB 4002 and HB 4003] are a part of a
solution. She reiterated the critical nature of the energy
trouble. She expressed a desire to see rural Alaska survive and
questioned which legislation would meet that goal.
MR. RUARO responded that "this" is an important piece of a much
larger puzzle, and he said he thinks Alaskans "need it and
should have it." He suggested to Co-Chair Fairclough that it
may be a good time to turn to the appropriations bill [HB 4003],
which he said has other implications for energy, including those
factors that are important to rural areas. He stated, "This
bill doesn't halt ... any progress that the administration is
working on towards long-term solutions, towards mid-term
solutions, towards other short-term solutions like the motor
fuel tax; this is just one piece."
9:20:16 AM
MR. BURNETT, in response to a request from Co-Chair Fairclough,
noted that the fiscal note for HB 4002, from the Department of
Revenue, is $810 million, of which approximately $800,000 is to
operate the program, $520,000 is to send out the checks, and
about $300,000 would be used to manage the supplemental
application process. Then there would be an additional
$10,600,000 to $10,700,000 for the Department of Health & Social
Services for "hold harmless."
CO-CHAIR FAIRCLOUGH observed that as money rolls in, the State
of Alaska begins moving it more quickly and in increasing sums,
thus, millions become billions, and sometimes the state loses
sight of what that money could really do if it were invested in
projects.
MR. BURNETT regarding estimated revenues, noted that this
morning, oil prices were approximately $145, and they have
averaged $138 a barrel for this fiscal year thus far. At those
prices, he related, the forecasted total revenue for the year is
$15-$18 billion. In response to Co-Chair Fairclough, he said
the fiscal year thus far means a few days. In further response
to Co-Chair Fairclough, he noted that when the revenue forecast
was made in April, it was done at $82 a barrel, which is clearly
out of the realm of reality at this point. June revenues are
included in the fiscal year 2009 (FY 09), he noted. He said the
department is certain that there is enough additional revenue
beyond what was expected in the first quarter of "this year" to
fund all the appropriation bills that were "put in this special
session."
CO-CHAIR FAIRCLOUGH said she does not quibble with the statement
that the state has the money to distribute, but does not want
the public to be misled. She said it may be true that there are
$10 billion extra, but estimates are not being based on that
particular number.
9:24:02 AM
CO-CHAIR FAIRCLOUGH said the governor has said that if the
legislature does not like the administration's proposal, it
should step up with a proposal to provide relief for Alaskans.
She asked if there is a plan that could be put in place to
address those in crisis, for example, a rural fuel loan program
that could get fuel to villages by means of river waterways.
MR. RUARO said he is not knowledgeable in that area. He
deferred to Ms. Fisher-Goad.
9:25:20 AM
SARA FISHER-GOAD, Deputy Director, Operations, Alaska Energy
Authority (AEA), specified two loan programs that offer capital
funds for purchasing long-term fuel: the bridge loan program,
run by the Department of Commerce, Community, & Economic
Development (DCCED), and AEA's long-standing bulk fuel revolving
loan fund program. Currently, she said, AEA is not seeing a
need for additional funds for the bulk fuel revolving loan fund.
She noted that HB 338 - [which was signed into law on 29 June
2008] - codified the bridge loan program for commerce, as well
as allowed AEA to borrow funds from the power project fund for
bulk fuel revolving loan needs. Typically, she said, there is a
cap on those programs of $500,000 per loan, and AEA has seen
only a handful of applications. She said it is early in the
season to know what the demand will be, but AEA thinks that with
the implementation of HB 338, and with the organization's
existing funds, the communities that typically borrow from bulk
fuel will have their needs met through that program.
MS. FISHER-GOAD, in response to Co-Chair Fairclough, said
typically a community purchases fuel and has it delivered for
the entire community, which includes retail purchases;
therefore, typically there is fuel being brought in to be sold
for individual use. She said she would need to think about what
type of capital would be needed or is desired for individuals,
but said she has not heard of that need. She explained that AEA
typically does not deal with individual borrowers, but often
deals with community borrowers, the electric utility, or the
village corporation.
CO-CHAIR FAIRCLOUGH requested that the administration provide a
presentation from Steven Haagenson, whom she described as the
administration's point person on its energy policies and plans.
She said she wants to ensure that enough fuel reaches
communities before winter comes and they may become landlocked.
9:29:04 AM
MS. FISHER-GOAD reminded the committee that Mr. Haagenson is on
schedule for July 22nd. She reported the actions Mr. Haagenson
and the agency have taken since Mr. Haagenson took office in
March, including: holding town hall meetings throughout the
state; addressing what types of technology should be applied;
implementing the HB 152 program and the granting of $5 million
to projects; preparing to go to the Legislative Budget and Audit
Committee to tap into the renewable energy fund for additional
projects that have met certain criteria; and working on a second
request for proposals (RFP) for additional projects to tap into
the rest of the FY 09 money made available by the legislature.
9:30:27 AM
REPRESENTATIVE CISSNA said she would like a history of what the
state has done thus far to monitor the energy situation in
communities. She clarified that she wants information,
regarding attrition due to the energy crisis. She said the loss
of populations in communities may jeopardize their existence.
9:32:14 AM
CO-CHAIR LeDOUX expressed interest in hearing about long-term
plans before making decisions to spend money on short-term
fixes.
MS. FISHER-GOAD said she believes Mr. Haagenson will be able to
answer the committee's questions.
9:33:19 AM
REPRESENTATIVE NEUMAN highlighted that the fiscal note analysis
[prepared by the Department of Revenue] reports that there will
be an additional 45,000 persons qualifying for [the energy
assistance program under the supplemental application program].
He added, "But we also have an analysis that says you're going
to be able to accomplish all that work with nine temporary
staff, and you're going to be able to do that with a minimum
amount of money." He remarked that that is a lot of work for
nine temporary people to do, and he asked for an explanation of
what process would be used and "how they're going to be able to
accomplish that task within somewhere of a month."
MR. BURNETT responded that "those people" will be accepting
applications, imaging them into the same system used for the PFD
process, determining qualifications, and entering information
into the database so that checks can be produced. He said the
department bases those numbers on the same productivity levels
used in relation to the seasonal employees hired to work for the
Permanent Fund Dividend Division. He said he thinks the
estimate, which was made by the same people that do the budgets
for the rest of the department, is a reasonable one. He
indicated that because of the division's track record, it is
possible but unlikely that there would be more work than
anticipated. The guidelines for the application would be
simpler, he added.
REPRESENTATIVE NEUMAN offered his understanding that the
estimate to which Mr. Burnett referred is shown in the analysis
for the aforementioned Department of Revenue's fiscal note, as
follows: "The cost of administering the supplemental
application process is estimated at $325,000." He observed that
that $325,000 is for nine employees to work for 30 days to
respond to approximately 45,000 applicants.
MR. BURNETT responded that the application period is actually 60
days. Furthermore, he said some of the people would be employed
for three months, while others would be employed for the balance
of the year, for example, to address appeals and the fraud line.
He reiterated that the division has a good track record.
REPRESENTATIVE NEUMAN remarked, "We also have a track record of
increasing the operating budget 12 to 14 percent over the last
few years."
9:37:14 AM
CO-CHAIR FAIRCLOUGH asked that questions from legislators not on
the committee be submitted through Representative LeDoux's
office.
MR. BURNETT, in response to a question from Co-Chair Fairclough,
confirmed that the resource rebate would be fully taxable under
federal law, thus it would have tax consequences for families
and individuals. In response to a second question, he clarified
that the program proposed through HB 4002 is a one-time program
with a sunset date; therefore, there would be no opportunity for
a person who did not apply or receive the rebate to "come back
and apply later." He pointed out that this is unlike the PFD,
which allows a person up until two years after his/her
eighteenth birthday to apply for any PFDs for which his/her
parents failed to apply.
MR. BURNETT, in further response to Co-Chair Fairclough, stated
his belief that the $800 million in the fiscal note is
sufficient to fund the program, unless there are more people to
apply than expected. He mentioned the amount of $1,200 and said
that the way the appropriation is written, "it's adjustable
internally." He mentioned the date, June 30, 2009, and said the
division would keep track of appeals, know how many applications
could be paid, and would encumber funds from this appropriation
that it could then use to make payments, "so that it would not
result in a supplemental as a result of an appeals process."
9:42:30 AM
CO-CHAIR FAIRCLOUGH, in response to Representative Cissna, said
there will be no video conferencing in upcoming hearings, but
there is statewide teleconferencing. She then announced the
upcoming hearing schedule.
[HB 4002 was heard and held.]
HB4003-APPROP: ENERGY RELIEF/REBATE/FUEL TAX
9:43:41 AM
CO-CHAIR FAIRCLOUGH announced that the final order of business
would be HOUSE BILL NO. 4003, "An Act making supplemental
appropriations to the Alaska Energy Authority for power cost
equalization; making special appropriations to the Department of
Revenue and to the Department of Health and Social Services for
the Alaska resource rebate program; making a special
appropriation to the Department of Revenue for the payment of
certain shared taxes relating to aviation fuel; and providing
for an effective date."
9:44:05 AM
KAREN J. REHFELD, Director, Office of Management & Budget,
Office of the Governor, noted that Jerry Burnett had touched
upon some factors of HB 4003 during discussion of HB 4002. In
addition to the resource rebate amount of $800 million and the
hold harmless, which is $10.7 million, there are some other
items in the bill, she noted. First, she said OMB has requested
the legislature's approval of a $9.7 million power cost
equalization (PCE) program, which would also require a $600,000
component in fiscal year 2008 (FY 08) to fully fund the PCE
program in 2008, and an estimated additional $9 million related
to "looking at what has changed in oil changes for FY 09."
Additionally, $150,000 has been requested, which Ms. Rehfeld
explained is a shared tax, hold harmless, and she indicated that
that is in a bill not before the committee - a bill related to
the suspension of the motor fuel tax. She explained that there
are several communities with municipally owned airports. If
aviation fuel tax were suspended, it would hold harmless those
airports for that loss of revenue. She said, "So, it's a small
component of that bill, but it is included in this appropriation
bill that's before you."
9:46:09 AM
MS. REHFELD presented a sectional analysis. Sections 1(a) and
1(b) show the appropriation request for the PCE, with an
increase of $600,000. It changes the existing appropriation to
reflect those increases. Sections 1(c)-(e) adjust the
appropriations for FY 09 based on the current estimate. Section
2 is the appropriation of $800 million to the Department of
Revenue for the resource rebate program, and it includes the
administrative cost of approximately $800,000 for the
nonpermanent positions talked about by Mr. Burnett during the
hearing on HB 4002. Section 3 is the hold harmless provision
under the Department of Health & Social Services, with an
estimated amount of $10.7 million to continue eligibility for
certain assistance programs resulting from the resource rebate.
Ms. Rehfeld noted that there are administrative costs of about
$770,000, and approximately 9 nonpermanent positions that would
be created to do that work. Section 4, she said, would give an
estimated $150 to the Department of Revenue for shared taxes
related to hold harmless and suspension of aviation fuel tax.
Ms. Rehfeld noted that several communities would receive funding
under that appropriation, including Anchorage, Juneau, the
Ketchikan Gateway Borough, Kenai, Kodiak, Palmer, Soldotna, and
Wasilla. Section 5 would provide a retroactive date for the
appropriations requested in Section 1(a) and 1(b) for the PCE
shortfall in fiscal year 2008. Section 6(a) holds contingent
language for Sections 2 and 3 of the bill, having to do with the
resource rebate program, while Section 6(b) is a contingency
related to the passage of the bill suspending the motor fuel
tax. Finally, Section 7 provides the immediate effective date.
9:48:48 AM
REPRESENTATIVE NEUMAN said he had requested a long-range plan,
having spoken about the issue with Commissioner Pat Galvin. He
observed that the state seems to be preparing to spend several
billions of dollars. He listed the PCE, roads related to this
pipeline, workforce training, mass transit, and the increased
cost of operating budgets. Representative Neuman said he thinks
spending money on building the state's infrastructure is an
important part of the capital budget process, because "it comes
right from the communities that we represent." A lot of the
capital budget projects were "needled" this year, he said,
because the legislature was told there was no money for them.
He stated that he is getting mixed signals. He disagreed with a
statement he said was made by Randy Ruaro that the state has
excess money. He not only said there is no excess money, but he
also predicted that the state would be in deficit in a few
years.
MS. REHFELD said she shares Representative Neuman's views
regarding the need for a long-range plan. She said legislation
has been passed, which requires that a long-range plan be
produced when [the administration] brings the budget to the
legislature this December. She related that there are many
things impacting Alaska in a way that could not have been
predicted even six months ago. With or without the gas line,
she said, the state has a huge need in the areas of deferred
maintenance and infrastructure development, and a long-range
plan is absolutely critical, so that "we" know how best to
invest "those dollars."
MS. REHFELD related that the governor has, since the beginning
of her term, maintained that [the administration] would be
responsible and reasonable in the proposals that it brings
before the legislature, and the governor's goals have been to
control the growth of government and save for the future She
said, "That is exactly how we're going to be able to bridge the
gap between now and the time we see ... revenues from first gas,
but that is going to take some significant discipline, even with
some of the increases that we're seeing here." She said the
state needs to move forward in a responsible manner, and the
administration is working diligently to bring [long-term] plans
to the legislature. She noted that Mr. Haagenson has "hit the
deck running on the energy plan." She emphasized the importance
of investing wisely in energy projects to get the best return
for the state's investment.
MS. REHFELD stated:
The governor's proposals here today ... [were]
designed to be very short-term, to do a rebate back to
Alaskans based on the revenue that we have seen,
knowing that, with that increase in revenue to Alaska,
we also have communities and individuals and families
that are hurting because of these increased costs. It
was not meant to be a long-term answer; ... this is a
very short-term solution while we continue to look
forward on these other components.
9:53:07 AM
REPRESENTATIVE NEUMAN indicated that he was asking yet again for
an estimate of "what's on the table right now" from various
departments. He said there are people with no medical insurance
in the state, and whether or not they can pay their heating
bills won't matter if they cannot survive due to health issues.
He clarified that he wants to see in writing how much the state
will be spending in the next few years on various proposed
programs, and he predicted that that number would be in the
billions. He reiterated that he does not think there will be
"extra" money in the next few years.
MS. REHFELD reiterated that the governor agrees that a long-term
plan is needed, and she said she would bring that plan to the
legislature.
9:54:09 AM
CO-CHAIR FAIRCLOUGH noted that Representative Olson, as chair of
the House Labor and Commerce Standing Committee, has control of
a bill relating to motor fuel tax, and she suggested that he
could perhaps present the issue to the House Community and
Regional Affairs Standing Committee.
9:54:24 AM
CO-CHAIR LeDOUX inquired as to the criteria that would make a
community eligible for the PCE.
MS. REHFELD deferred to Sara Fisher-Goad.
9:54:59 AM
SARA FISHER-GOAD, Deputy Director, Operations, Alaska Energy
Authority (AEA), in response to Co-Chair LeDoux, noted that
there are approximately 180 communities in the state eligible
for the PCE program, and she said those communities that used at
least 75 percent diesel in 1984 are eligible. She listed the
following as ineligible: Four Dam Pool communities, railbelt
communities, and any community that has a rate for power less
than the floor, which for this year is 12.83 cents.
9:56:02 AM
CO-CHAIR LeDOUX asked if there has been any thought given to
revisiting PCE and expanding it to include the entire state,
depending upon what the costs of energy are for the various
communities.
MS. FISHER-GOAD replied that the call has been expanded to
address PCE, but she offered her understanding that that was an
issue "requested from legislators to do that"; the
administration is not proposing changes to the PCE program at
this point. She related that she has heard there is concern
regarding a 12.83 cent floor being based upon the three
communities. She indicated that there are other communities
that have power costs greater than 12.83 cents currently, for
example, Kodiak, Glen Allen, and even Fairbanks.
9:57:25 AM
CO-CHAIR FAIRCLOUGH said the committee would have some
discussion related to motor fuel tax and whether or not there
would be any impact on federal appropriation. She noted that
some time ago, [in certain parts of the state], the 55 mile per
hour (mph) speed limit was changed to 65 mph, and she revealed
that she was one of a minority serving on a community council
who voted against that speed increase for safety concerns;
however, she said she has heard since that driving slower saves
gas. She complimented Juneau on its recent conservation efforts
during its energy crisis, and she talked about the state
considering its own energy consumption and then setting an
example for the people of Alaska to follow.
10:00:47 AM
RANDY RUARO, Special Staff Assistant, Office of the Governor,
said there is a computer system used for fuel monitoring that he
thinks is currently used by the ferry system used in British
Columbia, and is used on one vessel in Alaska, as well as being
considered for use on two more. Conservation efforts are
ongoing, Mr. Ruaro said, but he told the committee that Mr.
Haagenson would better be able to provide a more comprehensive
overview of the state's conservation efforts.
10:01:31 AM
CO-CHAIR FAIRCLOUGH returned the subject of the highway speed
limit and asked Mr. Ruaro if there is data that proves that
driving 55 mph reduces consumption and saves lives.
MR. RUARO responded that he does not know the answer, but he
agreed to obtain information from Department of Transportation &
Public Facilities' (DOT&PF's) Division of Highway Safety. He
recollected that certain counties in Washington state may have
returned to a 55 mph speed limit.
MS. REHFELD noted that because of Juneau's experience, there
have been real savings seen in state agencies, and "we" are
asking departments to figure out which of the measures Juneau
residents have taken can be implemented on an ongoing basis.
10:03:00 AM
REPRESENTATIVE SALMON asked for an explanation of the numbers
shown on page 2, line 6, of HB 4003.
MS. REHFELD responded as follows:
In subsection (b), what you're seeing is the $9
million going into the fund capitalization - a power
cost equalization fund - and then in sub part (d)
you're seeing the increase in the appropriation to be
able to expend the $9 million.
10:04:45 AM
REPRESENTATIVE SALMON said he would like an explanation of the
numbers shown [on page 2, lines 10-12].
MS. REHFELD responded:
The component that is coming from the $16 million is
the component that is ... generated from the power
cost equalization fund - the endowment fund - and then
it's further capitalized, the state general fund, so
we have to put the additional $9 million in general
funds in, in order to be able to fully fund the
program.
MS. REHFELD, in response to Co-Chair Fairclough, confirmed that
the amount shown in brackets on line 12, "[$9,353,800]", denotes
a deleted number. She said, "It was a lower amount in the
original bill, and we're adding the $9 million to that."
REPRESENTATIVE SALMON noted that the number in the brackets is
$353,800 over $9,000,000, and he asked where that overage goes.
MS. REHFELD responded as follows:
It's just an increase to the original number was
$9,353,000, and we've just added another $9 million to
that number. So, it's just the total ... now of
general funds going to the power cost equalization
program will be $18,353,800.
CO-CHAIR FAIRCLOUGH reiterated her interest in finding out how
individual families and public service announcements can affect
conservation efforts.
[HB 4003 was heard and held.]
10:06:06 AM
CO-CHAIR FAIRCLOUGH reminded the public of the upcoming
opportunity for public comment in Anchorage.
10:06:19 AM
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 10:06 a.m.
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