Legislature(1993 - 1994)

01/31/1994 08:15 AM RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                                                                               
               HOUSE RESOURCES STANDING COMMITTEE                              
                        January 31, 1994                                       
                            8:15 a.m.                                          
                                                                               
                                                                               
  MEMBERS PRESENT                                                              
                                                                               
  Representative Bill Hudson, Vice Chairman                                    
  Representative Con Bunde                                                     
  Representative Pat Carney                                                    
  Representative Joe Green                                                     
  Representative David Finkelstein                                             
                                                                               
  MEMBERS ABSENT                                                               
                                                                               
  Representative Bill Williams, Chairman                                       
  Representative John Davies                                                   
  Representative Jeannette James                                               
  Representative Eldon Mulder                                                  
                                                                               
  OTHER LEGISLATORS PRESENT                                                    
                                                                               
  Representative Richard Foster                                                
                                                                               
  COMMITTEE CALENDAR                                                           
                                                                               
  HB 384:  "An Act eliminating the temporary character                         
            of alternative procedures available to persons                     
            who must show evidence of financial responsibility                 
            before conducting noncrude oil operations; and                     
            providing for an effective date."                                  
                                                                               
            MOVED OUT OF COMMITTEE WITH INDIVIDUAL                             
            RECOMMENDATIONS                                                    
                                                                               
                                                                               
  WITNESS REGISTER                                                             
                                                                               
  LARRY LABOLLE, Chief of Staff                                                
  Representative Richard Foster's Office                                       
  State Capitol, Room 420                                                      
  Juneau, Alaska   99801-1182                                                  
  Phone:  465-3789                                                             
  Position Statement:  Gave an overview on HB 384 and answered                 
                       questions                                               
                                                                               
  MARY MCDOWELL, House Resources Committee Aide                                
  Representative Bill Williams                                                 
  State Capitol, Room 126                                                      
  Juneau, Alaska   99801-1182                                                  
  Phone:  465-3715                                                             
  Position Statement:  Answered a question                                     
                                                                               
  PREVIOUS ACTION                                                              
                                                                               
  BILL:  HB 384                                                                
  SHORT TITLE:  FINANCIAL REQMTS: NONCRUDE OIL OPERATIONS                      
  SPONSOR(S):   REPRESENTATIVE(S) FOSTER, Hoffman, Green                       
                                                                               
  JRN-DATE     JRN-PG               ACTION                                     
  01/18/94      2098    (H)   READ THE FIRST TIME/REFERRAL(S)                  
  01/18/94      2098    (H)   OIL & GAS, RESOURCES                             
  01/24/94              (H)   O&G AT 05:00 PM CAPITOL 124                      
  01/24/94              (H)   MINUTE(O&G)                                      
  01/26/94      2151    (H)   O&G RPT  6DP                                     
  01/26/94      2152    (H)   DP:  G. DAVIS, OLBERG, KOTT,                     
                              SANDERS                                          
  01/26/94      2152    (H)   DP:  SITTON, GREEN                               
  01/26/94      2152    (H)   -ZERO FISCAL NOTE (DEC)  1/26/94                 
  01/26/94      2160    (H)   COSPONSOR(S):  GREEN                             
  01/31/94              (H)   RES AT 08:15 AM CAPITOL 124                      
                                                                               
                                                                               
  ACTION NARRATIVE                                                             
                                                                               
  TAPE 94-7, SIDE A                                                            
  Number 000                                                                   
                                                                               
  The House Resources Committee was called to order by Vice                    
  Chairman Bill Hudson at 8:20 a.m.  Members present at the                    
  call to order were Representatives Hudson, Bunde, Carney,                    
  and Green.  Members absent were Representatives Williams,                    
  Davies, James, Finkelstein and Mulder.                                       
                                                                               
  HB 384 - FINANCIAL REQMTS: NONCRUDE OIL OPERATIONS                           
                                                                               
  Number 011                                                                   
                                                                               
  REPRESENTATIVE RICHARD FOSTER, PRIME SPONSOR, HB 384 told                    
  committee members he was appreciative that they were hearing                 
  HB 384 which was before the Oil and Gas Committee the                        
  previous week.  He asked his chief of staff to come forward                  
  and give background information on HB 384.                                   
                                                                               
  LARRY LaBOLLE, CHIEF OF STAFF, REPRESENTATIVE RICHARD                        
  FOSTER'S OFFICE, stated HB 384 is simple and                                 
  straightforward.  It eliminates the sunset clause in the                     
  current statute which requires direct action insurance for                   
  noncrude operators.  He said after the current legislation                   
  became law, noncrude operators could not get $150 million                    
  direct action insurance.  Direct action means the insurer is                 
  sued, not the perpetrator of the action.                                     
                                                                               
  MR. LaBOLLE said the insurance companies for several reasons                 
  were unwilling to write the type of insurance policy                         
  required.  He mentioned the Department of Natural Resources                  
  (DNR) did get waivers on the requirement before the                          
  legislation allowed it.  He said at that time, Senator Lyman                 
  Hoffman asked for the current exemption which sunsets on                     
  July 1, 1994.                                                                
                                                                               
  MR. LaBOLLE told committee members that HB 384 removes the                   
  sunset provision from the statute.  He stated there was                      
  testimony at the Oil and Gas Committee meeting from                          
  operators who cannot get the insurance, and added that DNR                   
  also testified at the meeting saying the department was in                   
  support of HB 384, since operators still would be required                   
  to show financial responsibility.                                            
                                                                               
  Number 036                                                                   
                                                                               
  (VICE CHAIRMAN HUDSON noted for the record that                              
  REPRESENTATIVE FINKELSTEIN had joined the meeting at 8:25                    
  p.m. and a QUORUM was not present).                                          
                                                                               
  REPRESENTATIVE CON BUNDE asked if HB 384 speaks only to                      
  direct action insurance and not insurance at another level                   
  which operators have.                                                        
                                                                               
  MR. LaBOLLE responded HB 384 speaks only to the direct                       
  action insurance requirement and still does not provide any                  
  type of waiver from DNR oversight.                                           
                                                                               
  VICE CHAIRMAN HUDSON asked if there still is a federal                       
  requirement for insurance.                                                   
                                                                               
  Number 050                                                                   
                                                                               
  MR. LaBOLLE replied the requirement for insurance still                      
  exists on the federal level, but the problem is not the                      
  requirement for insurance, the problem lies in the                           
  requirement for direct access.                                               
                                                                               
  VICE CHAIRMAN HUDSON recalled when the current statute was                   
  enacted, there was a lot of concern about whether or not the                 
  insurance industry would be able to provide the type of                      
  insurance required, and whether or not small operators would                 
  be able to afford it if it were available.                                   
                                                                               
  REPRESENTATIVE JOE GREEN made a motion to MOVE HB 384 from                   
  committee with INDIVIDUAL RECOMMENDATIONS.                                   
                                                                               
  VICE CHAIRMAN HUDSON asked if there were any objections.                     
  Hearing none, the MOTION PASSED.                                             
                                                                               
  ANNOUNCEMENTS                                                                
                                                                               
  VICE CHAIRMAN HUDSON advised the committee they would meet                   
  on Wednesday, February 2 at 8:00 a.m. for a briefing on the                  
  federal wetlands policy in Alaska.  He said the presentation                 
  will be given by Alvin Ewing of the United States                            
  Environmental Protection Agency.  Paul Rusanowski of the                     
  Governor's Office, Division of Governmental Coordination,                    
  will give a briefing on the administration's perspective on                  
  wetlands policy and federal activity in this area.                           
                                                                               
  REPRESENTATIVE GREEN asked if there will be any                              
  representatives from the Corps of Engineers at the meeting.                  
                                                                               
  MARY McDOWELL, HOUSE RESOURCES COMMITTEE AIDE,                               
  REPRESENTATIVE BILL WILLIAMS, responded the Corps of                         
  Engineers declined the invitation.  She met with Paul                        
  Rusanowski earlier and he planned to ask them again.                         
                                                                               
  ADJOURNMENT                                                                  
                                                                               
  There being no further business to come before the House                     
  Resources Committee, Vice Chairman Hudson adjourned the                      
  meeting at 8:30 a.m.                                                         

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