Legislature(2017 - 2018)BARNES 124

04/02/2018 01:00 PM RESOURCES

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Delayed to 6:30 pm --
+= HB 399 CORP. TAX: REMOVE EXEMPTIONS/CREDITS TELECONFERENCED
Scheduled but Not Heard
-- Testimony <Invitation Only> --
+= HB 315 CONFIDENTIALITY OF ANIMAL & CROP RECORDS TELECONFERENCED
Moved CSHB 315(RES) Out of Committee
-- Testimony <Invitation Only> --
+= HB 27 HIGH-RISK CHEMICALS FOR CHILD EXPOSURE TELECONFERENCED
Scheduled but Not Heard
-- Testimony <Invitation Only> --
+= HB 260 FISH & GAME LICENSES;ELECTRONIC FORM TELECONFERENCED
Scheduled but Not Heard
-- Testimony <Invitation Only> --
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 288 OIL AND GAS PRODUCTION TAX TELECONFERENCED
Heard & Held
                    ALASKA STATE LEGISLATURE                                                                                  
               HOUSE RESOURCES STANDING COMMITTEE                                                                             
                         April 2, 2018                                                                                          
                           6:36 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Andy Josephson, Co-Chair                                                                                         
Representative Geran Tarr, Co-Chair                                                                                             
Representative John Lincoln, Vice Chair                                                                                         
Representative Harriet Drummond                                                                                                 
Representative Justin Parish                                                                                                    
Representative Chris Birch                                                                                                      
Representative DeLena Johnson                                                                                                   
Representative George Rauscher                                                                                                  
Representative David Talerico                                                                                                   
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                              
Representative Mike Chenault (alternate)                                                                                        
Representative Chris Tuck (alternate)                                                                                           
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                              
HOUSE BILL NO. 288                                                                                                              
"An  Act relating  to  the minimum  tax imposed  on  oil and  gas                                                               
produced from leases or properties  that include land north of 68                                                               
degrees North latitude; and providing for an effective date."                                                                   
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
HOUSE BILL NO. 315                                                                                                              
"An Act  relating to  the confidentiality  of certain  records on                                                               
animals and crops; and providing for an effective date."                                                                        
                                                                                                                                
     - MOVED CSHB 315(RES) OUT OF COMMITTEE                                                                                     
                                                                                                                                
HOUSE BILL NO. 399                                                                                                              
"An Act disallowing a federal tax  credit as a credit against the                                                               
corporate  net income  tax; repealing  a  provision allowing  the                                                               
exclusion of  certain royalties accrued or  received from foreign                                                               
corporations  for  purposes  of  the corporate  net  income  tax;                                                               
repealing the  reduced rate  for the  alternative tax  on capital                                                               
gains  for corporations;  repealing  an exemption  from filing  a                                                               
return  under the  corporate  net income  tax  for a  corporation                                                               
engaged in a  contract under the Alaska  Stranded Gas Development                                                               
Act; and providing for an effective date."                                                                                      
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                
                                                                                                                                
HOUSE BILL NO. 27                                                                                                               
"An  Act relating  to  chemicals  that are  of  high concern  for                                                               
children and to  the manufacture and sale  of products containing                                                               
certain  flame retardant  chemicals;  relating  to an  interstate                                                               
chemicals  clearinghouse; adding  an unlawful  act to  the Alaska                                                               
Unfair  Trade   Practices  and   Consumer  Protection   Act;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
HOUSE BILL NO. 260                                                                                                              
"An Act  relating to electronic  possession of  certain licenses,                                                               
tags, and identification  cards issued by the  Department of Fish                                                               
and Game; and providing for an effective date."                                                                                 
                                                                                                                                
     - SCHEDULED BUT NOT HEARD                                                                                                  
                                                                                                                                
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 288                                                                                                                  
SHORT TITLE: OIL AND GAS PRODUCTION TAX                                                                                         
SPONSOR(s): REPRESENTATIVE(s) TARR                                                                                              
                                                                                                                                
01/16/18       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/16/18       (H)       RES, FIN                                                                                               
01/22/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
01/22/18       (H)       Heard & Held                                                                                           
01/22/18       (H)       MINUTE(RES)                                                                                            
01/26/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
01/26/18       (H)       Heard & Held                                                                                           
01/26/18       (H)       MINUTE(RES)                                                                                            
01/29/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
01/29/18       (H)       Heard & Held                                                                                           
01/29/18       (H)       MINUTE(RES)                                                                                            
03/30/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/30/18       (H)       Scheduled but Not Heard                                                                                
04/02/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
                                                                                                                                
BILL: HB 315                                                                                                                  
SHORT TITLE: CONFIDENTIALITY OF ANIMAL & CROP RECORDS                                                                           
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
01/26/18       (H)       READ THE FIRST TIME - REFERRALS                                                                        
01/26/18       (H)       JUD, RES                                                                                               
02/09/18       (H)       JUD AT 1:00 PM GRUENBERG 120                                                                           
02/09/18       (H)       Heard & Held                                                                                           
02/09/18       (H)       MINUTE(JUD)                                                                                            
02/12/18       (H)       JUD AT 1:30 PM GRUENBERG 120                                                                           
02/12/18       (H)       Moved HB 315 Out of Committee                                                                          
02/12/18       (H)       MINUTE(JUD)                                                                                            
02/14/18       (H)       JUD RPT 3DP 2NR 1AM                                                                                    
02/14/18       (H)       DP: KOPP, KREISS-TOMKINS, CLAMAN                                                                       
02/14/18       (H)       NR: LEDOUX, MILLETT                                                                                    
02/14/18       (H)       AM: EASTMAN                                                                                            
03/02/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/02/18       (H)       -- MEETING CANCELED --                                                                                 
03/16/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/16/18       (H)       Heard & Held                                                                                           
03/16/18       (H)       MINUTE(RES)                                                                                            
03/21/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/21/18       (H)       Scheduled but Not Heard                                                                                
03/23/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/23/18       (H)       -- MEETING CANCELED --                                                                                 
03/26/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
03/26/18       (H)       -- Meeting Postponed to 3/27/18 at 6:30                                                                
                         pm--                                                                                                   
03/27/18       (H)       RES AT 6:30 PM BARNES 124                                                                              
03/27/18       (H)       Scheduled but Not Heard                                                                                
04/02/18       (H)       RES AT 1:00 PM BARNES 124                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
CHRISTINA CARPENTER, Director                                                                                                   
Division of Environmental Health                                                                                                
Department of Environmental Conservation                                                                                        
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Presented amendments and answered questions                                                              
during the hearing of HB 315.                                                                                                   
                                                                                                                                
JENNIFER CURRIE, Senior Assistant Attorney General                                                                              
Environmental Section                                                                                                           
Civil Division(Anchorage)                                                                                                       
Department of Law                                                                                                               
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions during the hearing of HB                                                              
315.                                                                                                                            
                                                                                                                                
ROBERT GERLACH, VMD, State Veterinarian                                                                                         
Office of the State Veterinarian                                                                                                
Division of Environmental Health                                                                                                
Department of Environmental Conservation                                                                                        
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Answered questions  during the hearing of HB                                                             
315.                                                                                                                            
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                              
6:36:03 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  GERAN   TARR  called   the  House   Resources  Standing                                                             
Committee meeting  to order at  6:36 p.m.   Representatives Tarr,                                                               
Johnson,  Rauscher,  Talerico,   Lincoln,  Drummond,  Birch,  and                                                               
Josephson  were present  at the  call to  order.   Representative                                                               
Parish arrived as the meeting was in progress.                                                                                  
                                                                                                                                
               HB 288-OIL AND GAS PRODUCTION TAX                                                                            
                                                                                                                              
6:37:04 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR  announced that the  first order of  business would                                                               
be  HOUSE BILL  NO.  288, "An  Act relating  to  the minimum  tax                                                               
imposed on  oil and gas  produced from leases or  properties that                                                               
include land  north of 68  degrees North latitude;  and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
6:37:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE LINCOLN  moved to  adopt the  committee substitute                                                               
(CS) for  HB 288,  labeled 30-LS1155\D,  Nauman, 3/27/18,  as the                                                               
working document.                                                                                                               
                                                                                                                                
CO-CHAIR TARR objected for discussion purposes.                                                                                 
                                                                                                                                
6:37:29 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR passed the gavel to Co-Chair Josephson.                                                                           
                                                                                                                                
CO-CHAIR  TARR  provided   a  PowerPoint  presentation  entitled,                                                               
"House Bill 288  CS Version D Fairness in Oil  Taxes."  She began                                                               
her  introduction of  CS  for  HB 288,  Version  D, by  reviewing                                                               
provisions of HB  288.  The bill affects the  oil and gas minimum                                                               
tax statute  which is currently 4  percent of the gross  value at                                                               
the point of production (GVPP);  the original version of the bill                                                               
increased  the  minimum tax  to  7  percent.   She  reminded  the                                                               
committee  the  reason to  propose  this  legislation is  because                                                               
Alaska's effective tax  rate is one of the lowest  in the U.S. at                                                               
lower  price  levels   (slide  1).    Slide   2  illustrated  the                                                               
difference in taxes collected at  various minimum tax rates at an                                                               
oil  price  of  $60  [per   barrel];  for  example,  the  current                                                               
severance  tax collected  by the  state is  approximately $2  per                                                               
barrel; at  a minimum tax  of 7  percent the state  would collect                                                               
about $3.51.  Co-Chair Tarr  pointed out the proposed legislation                                                               
affects  tax  rates  at  lower  oil  prices,  acknowledging  that                                                               
industry  seeks  to  react  to  higher or  lower  oil  prices  by                                                               
adjusting  lease expenditures.   Slide  3 listed  three questions                                                               
related  to the  bill:   how  much profit  per  barrel; how  many                                                               
barrels  total;  how  much  revenue   to  the  state?    Slide  4                                                               
illustrated various  calculations based  on the  total production                                                               
of  taxable   barrels  and  royalty  barrels,   and  she  advised                                                               
production must rise over 100,000  new barrels per day to achieve                                                               
an  increase  in state  revenue  that  would make  a  significant                                                               
impact on  the state's financial  situation.   Slide 5 was  a bar                                                               
graph that  showed an  estimated deficit  of $2.7  billion, which                                                               
when  adjusted  to  the [Tax  Division,  Department  of  Revenue,                                                               
Revenue  Sources  Book (RSB)  Revenue  Forecast:   Spring  2018],                                                               
would be $2.3  billion.  Slide 6 illustrated  the current minimum                                                               
tax  at oil  prices from  $25  to over  $65 per  barrel, and  the                                                               
effects of changes made  by HB 288 and CSHB 288,  Version D.  Co-                                                               
Chair Tarr observed an oil price  of above $50 places industry in                                                               
a profit  margin relative  to "old  spending," thus  the proposed                                                               
increase  impacts  companies when  they  "have  a little  bit  of                                                               
ability to make those adjustments."                                                                                             
                                                                                                                                
6:43:32 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  TARR continued  to slide  7 that  illustrated effective                                                               
severance tax  rates paid by  the industry in various  [Lower 48]                                                               
states, and  she acknowledged the difficulty  in comparing Alaska                                                               
with other  states due  to its development  costs.   She returned                                                               
attention  to slide  2 and  noted Alaska's  tax rate  at $60  per                                                               
barrel  oil  prices, as  a  percentage  of  GVPP, is  4  percent;                                                               
however, tax  as a  percentage of production  tax value  (PTV) is                                                               
currently approximately 9  percent due to the  net profit system.                                                               
Co-Chair  Tarr directed  attention  to  [Fiscal Note  Identifier:                                                               
HB288-DOR-TAX-1-20-18, and a document  entitled "Provisions in HB                                                               
288 with possible amendment ...  Revised 3/27/18 by DOR, provided                                                               
in the committee packet].  She  said the adjusted [fiscal note to                                                               
CSHB 288, Version  D] indicated the total fiscal impact  in FY 19                                                               
would be about $64 million;  however, for later years, the impact                                                               
is  similar to  that of  the original  version of  the bill.   In                                                               
response to  comments related to [the  legislative working group,                                                               
which is a  provision of House Bill 111, passed  in the Thirtieth                                                               
Alaska State  Legislature], she cautioned  the working  group may                                                               
not focus on  increasing revenue but may seek to  improve how the                                                               
tax  system operates  in  order  to enable  the  state to  better                                                               
predict and  understand oil  and gas tax  revenue.   Further, Co-                                                               
Chair Tarr estimated the working  group would not have a proposal                                                               
for a new  tax structure in place before FY  22; she stressed the                                                               
importance of  CSHB 288 is  to address additional revenue  for FY                                                               
19 through FY 21.                                                                                                               
                                                                                                                                
6:50:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  BIRCH  said the  proposed  legislation  is a  bad                                                               
idea;  he returned  attention  to  slide 4  and  pointed out  the                                                               
royalty  share  is  four  times  that  of  revenue  from  taxable                                                               
barrels.  He expressed his  concern a significant increase in the                                                               
taxable  rate, and  another change  in the  tax structure,  would                                                               
adversely impact steady production on  the North Slope.  Further,                                                               
the bill  would not  encourage the investment  that is  needed to                                                               
sustain  exploration;  for  example,  a 100,000  barrel  per  day                                                               
increase would  result in  an increase in  state revenue  of $300                                                               
million.     Representative  Birch  asked  how   the  bill  would                                                               
encourage or attract investment.                                                                                                
                                                                                                                                
CO-CHAIR  TARR  said  Alaska is  a  profitable  jurisdiction  for                                                               
Alaska  businesses;  in  fact,   BP  reported  Alaska  businesses                                                               
garnered an annual profit  of $118 million [letter/report/article                                                               
not provided].   She  said the state  must balance  its competing                                                               
needs with other proposals that would benefit industry.                                                                         
                                                                                                                                
CO-CHAIR  JOSEPHSON  recalled  in  2013,  when  oil  prices  were                                                               
[higher], royalty  barrel revenue  was "sort of  an afterthought,                                                               
in this  calculus, and  now they've  become the  dominant theme."                                                               
He questioned  the projection of  additional production  shown on                                                               
slide 4.                                                                                                                        
                                                                                                                                
6:54:08 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR acknowledged  the most recent RSB  does not predict                                                               
an increase [in production] and  said she does not expect 100,000                                                               
barrels of new production "anytime soon."                                                                                       
                                                                                                                                
REPRESENTATIVE RAUSCHER asked  for the basis of  both the current                                                               
tax rate and the changes proposed in CSHB 288, Version D.                                                                       
                                                                                                                                
CO-CHAIR  TARR recalled  the tax  rates  originated from  earlier                                                               
legislation:   Senate Bill  21, [the  More Alaska  Production Act                                                               
passed in  the Twenty-Eighth Alaska State  Legislature] and House                                                               
Bill 2001, [Alaska's Clear and  Equitable Share (ACES), passed in                                                               
the  Twenty-Fifth Alaska  State  Legislature].   The minimum  tax                                                               
structure established by  ACES was 10 percent,  which was lowered                                                               
to  4 percent  in  Senate Bill  21.   However,  at  the time  the                                                               
provisions of Senate  Bill 21 were debated, oil  prices were $110                                                               
per barrel  thus there was  not much discussion about  the bill's                                                               
impact  on state  revenue  at  low oil  prices  over an  extended                                                               
period of time.   She characterized the impact of  Senate Bill 21                                                               
as a  "surprise."  Co-Chair  Tarr returned attention to  slides 6                                                               
and 2 and  provided a further explanation of how  the minimum tax                                                               
rate is calculated and restated the intent of CSHB 288.                                                                         
                                                                                                                                
6:59:27 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RAUSCHER  expressed   his  concern  about  making                                                               
changes to  "certain price points"  instead of debating  a change                                                               
to the tax structure system.                                                                                                    
                                                                                                                                
CO-CHAIR TARR  stated the intent  of the proposed  legislation is                                                               
to  not  attempt  a  fundamental  overhaul of  oil  and  gas  tax                                                               
statute; in fact, that is the  purpose of the working group which                                                               
is  a   bipartisan  and  bicameral   group  that   will  consider                                                               
improvements to the tax structure.   One of the important aspects                                                               
that will be reviewed is the  per barrel tax credit which affects                                                               
the minimum tax as illustrated on slide 2.                                                                                      
                                                                                                                                
REPRESENTATIVE RAUSCHER  questioned whether  [oil and  tax regime                                                               
legislative]  consultants  provided  guidance  for  the  proposed                                                               
legislation.                                                                                                                    
                                                                                                                                
CO-CHAIR  TARR  said a  consultant  advised  [HB 288]  should  be                                                               
changed to provide  protection [for industry] in a  low oil price                                                               
environment -  when prices are $25  to $40 per barrel  - as shown                                                               
on slide 6.  She remarked:                                                                                                      
                                                                                                                                
     ... net  profits means  you get to  deduct all  of your                                                                    
     expenses before ...  we consider any taxes  but under a                                                                    
     net profit system in that  price range, there's nothing                                                                    
     left to tax because the price is so low.                                                                                   
                                                                                                                                
REPRESENTATIVE JOHNSON  asked for further information  related to                                                               
BP's financial position in Alaska.                                                                                              
                                                                                                                                
CO-CHAIR    TARR     referred    to    a    letter     from    BP                                                               
[letter/report/article  not provided].   She  said BP  noted many                                                               
costs were  not included  [in the  letter/report/article] related                                                               
to its profits, for example,  operating the Trans-Alaska Pipeline                                                               
System  (TAPS).    Co-Chair  Tarr  pointed  out  TAPS  costs  are                                                               
recouped    by   shipping    tariffs   and    other   deductions,                                                               
transportation   costs  are   deducted,  costs   associated  with                                                               
developing new  projects are  business decisions,  and deductible                                                               
capital investment  in Prudhoe Bay  is necessary to  produce oil.                                                               
She  opined the  proposed  legislation is  a  stopgap measure  to                                                               
address the state's  situation over the next  three years because                                                               
oil prices have not stabilized.                                                                                                 
                                                                                                                                
7:05:43 PM                                                                                                                    
                                                                                                                                
CO-CHAIR JOSEPHSON recalled in  2016, the administration proposed                                                               
an  increase from  4 percent  to  5 percent  at a  time when  oil                                                               
prices were  in the $40  to $55  range, which is  consistent with                                                               
the proposed legislation.                                                                                                       
                                                                                                                                
REPRESENTATIVE  PARISH returned  attention to  slide 7  and asked                                                               
whether the tax rates shown are based on GVPP.                                                                                  
                                                                                                                                
CO-CHAIR TARR said yes.                                                                                                         
                                                                                                                                
REPRESENTATIVE  PARISH surmised  the effective  tax rate  paid by                                                               
industry [in Alaska] is around 4 percent.                                                                                       
                                                                                                                                
CO-CHAIR TARR remarked:                                                                                                         
                                                                                                                                
      ... the minimum tax is a 4 percent tax at the gross                                                                       
      value of the point of production so, effectively, we                                                                      
     have a 4 percent gross tax right now.                                                                                      
                                                                                                                                
CO-CHAIR  TARR, in  further  response  to Representative  Parish,                                                               
said the [reduced taxes] are not  entirely a result of the $8 per                                                               
barrel credit,  but also because  the per barrel credit  is given                                                               
after deductions for transportation  and lease expenditures, "and                                                               
then  we apply  the  35 percent  tax  rate so  you  reduce it  by                                                               
essentially a third,  and then you add the $8  per barrel credit,                                                               
so it's  the order in which  those things happen that  makes that                                                               
per barrel credit have so much power to distort the math."                                                                      
                                                                                                                                
7:08:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PARISH  asked why Alaska's rates  are low compared                                                               
with the tax rates of other states illustrated on slide 7.                                                                      
                                                                                                                                
CO-CHAIR TARR  described some of Alaska's  legislative history in                                                               
this regard.  Turning to the  issue of the stability [of Alaska's                                                               
tax policy],  she cautioned  Alaska could  experience instability                                                               
from teacher strikes and a  citizen's initiative in support of an                                                               
aggressive policy to increase oil and gas state revenue.                                                                        
                                                                                                                                
REPRESENTATIVE   JOHNSON   expressed   her   concern   that   the                                                               
committee's  discussion of  tax rates  is driven  by the  state's                                                               
internal  needs, rather  than  an external  analysis  of oil  tax                                                               
policy in  the world market.   She cautioned against  driving the                                                               
oil industry out  of Alaska because the state  cannot control its                                                               
spending and  said she has read  in the Wall Street  Journal that                                                               
trade   war  worries   are  driving   down  the   price  of   oil                                                               
internationally [document not  provided].  Representative Johnson                                                               
restated  her concerns  about "stopgap,  last-minute, tax  policy                                                               
destabilization" late in the legislative session.                                                                               
                                                                                                                                
CO-CHAIR  TARR  observed  HB  288 was  introduced  early  in  the                                                               
legislative session  and the  CS now proposed  is in  response to                                                               
present  funding  questions.    She  acknowledged  the  preceding                                                               
concerns and restated aspects of Alaska's present tax policy.                                                                   
                                                                                                                                
7:15:06 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH  returned attention  to slide 2  and pointed                                                               
out  the state's  royalty share  is omitted.   He  said the  12.5                                                               
percent royalty share  is a huge component and should  not be set                                                               
aside or  ignored; in fact, "you  could have a, a  great big high                                                               
tax and  no production, and  it doesn't matter."   Representative                                                               
Birch  opined   the  focus  should   be  turned   to  production,                                                               
attracting  investment to  increase production,  and exploration.                                                               
He restated  royalty share is  a very significant  component that                                                               
is discounted and ignored too often.                                                                                            
                                                                                                                                
CO-CHAIR  TARR said,  " ...  a barrel  is going  to be  a taxable                                                               
barrel or it's going  to be a royalty barrel -  one barrel is not                                                               
both  things.   So, [slide  2] is  what's happening  with taxable                                                               
barrels but  that's why we've made  sure to include [slide  4] so                                                               
folks can  see the  accompanying royalty  barrels."   She advised                                                               
one of the  tasks for the working group would  be to review other                                                               
jurisdictions  because  royalty  rates are  increasing  on  newer                                                               
leases.   Other systems for the  working group to consider  are a                                                               
gross tax, an adjusted net profits  tax, or that new leases, with                                                               
higher royalties, would negate debates about taxes.                                                                             
                                                                                                                                
REPRESENTATIVE BIRCH  opined it is inaccurate  to portray barrels                                                               
of oil as taxable barrels or royalty barrels.  He said:                                                                         
                                                                                                                                
       The barrels come out of the ground and there's an                                                                        
     allocation that for our royalty share and the taxable                                                                      
     component is  ... they  all come out  of the  ground at                                                                    
     the same  time ... and  I think  it's fair to  say that                                                                    
     that  the more  production  you have  the more  royalty                                                                    
     revenue you have.                                                                                                          
                                                                                                                                
REPRESENTATIVE PARISH  asked whether  there has been  research to                                                               
determine the amount of a subsidy  that would be required to lead                                                               
to an increase in production.                                                                                                   
                                                                                                                                
7:19:49 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  TARR  said  according  to  DOR,  the  state  has  spent                                                               
approximately $6  billion on  the tax credit  program.   She said                                                               
"some people" have  buyer's remorse about the  tax credit program                                                               
and referred to  [House Bill 331, passed in  the Thirtieth Alaska                                                               
State  Legislature],   the  governor's  [tax   credit]  repayment                                                               
program, which proposes a better  rate for repayment if a company                                                               
reinvests  in  Alaska.   In  further  response to  Representative                                                               
Parish, she agreed  it is unclear whether the  tax credit program                                                               
is responsible  for projects; in  fact, one of the  provisions of                                                               
Senate Bill 21  is the gross value reduction (GVR)  on "new oil,"                                                               
and  there  was  contention  about whether  GVR  would  apply  to                                                               
projects  that  were  new  oil  or  that  were  already  planned.                                                               
Further, House Bill 247 [passed  in the Twenty-Ninth Alaska State                                                               
Legislature]  scaled back  GVR by  imposing  a time  limit.   She                                                               
acknowledged decisions are made without enough information.                                                                     
                                                                                                                                
CO-CHAIR  JOSEPHSON observed  the  limitation on  GVR  oil was  a                                                               
reform of Senate Bill 21.                                                                                                       
                                                                                                                                
CO-TARR  agreed  and  pointed  out the  tax  credit  program  was                                                               
repealed.                                                                                                                       
                                                                                                                                
REPRESENTATIVE RAUSCHER  gave several examples  of infrastructure                                                               
that is  only necessary  during the winter  season in  Alaska and                                                               
that is  provided by industry  in an  environmentally responsible                                                               
way.   He cautioned  against comparing  the cost  of oil  and gas                                                               
extraction in Alaska to that of other states.                                                                                   
                                                                                                                                
7:25:56 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR  reminded the committee spending  by industry falls                                                               
into  two categories  of lease  expenditures, operating  expenses                                                               
and   capital  expenses,   thus   some   of  the   abovementioned                                                               
infrastructure  costs would  be included  in capital  expenditure                                                               
deductions.    Also, because  the  winter  season is  shortening,                                                               
costs  will rise  as projects  dependent upon  ice roads  and ice                                                               
platforms  will be  delayed.   However,  the  state invested  $10                                                               
million into  the Arctic  Strategic Transportation  and Resources                                                               
(ASTAR)   project,   Department   of  Transportation   &   Public                                                               
Facilities, which seeks  to develop a permanent  road system; she                                                               
suggested investing  in infrastructure instead of  tax credits is                                                               
a better choice for the state.                                                                                                  
                                                                                                                                
REPRESENTATIVE RAUSCHER said:                                                                                                   
                                                                                                                                
     I just  wanted to say that  is probably why we  fall in                                                                    
     where we  do on this line  [slide 7] of when  you asked                                                                    
     why our  percentage is the way  it is - because  of the                                                                    
     extra added cost.                                                                                                          
                                                                                                                                
CO-CHAIR  TARR responded  Alaska's [effective  tax rate  shown on                                                               
slide 7]  is due to  the state's hard  minimum tax of  4 percent.                                                               
The chart [on slide 7] is not reflection of costs.                                                                              
                                                                                                                                
REPRESENTATIVE RAUSCHER said  Alaska could not afford  a tax rate                                                               
equal to Wyoming's of 13.4 percent.                                                                                             
                                                                                                                                
CO-CHAIR TARR  recalled the  original version  of Senate  Bill 21                                                               
provided for a 25 percent tax rate.                                                                                             
                                                                                                                                
REPRESENTATIVE JOHNSON reviewed related  topics from the previous                                                               
year such as:   discussions about production; there was  to be no                                                               
tax  bill  this session;  there  was  increased production.    In                                                               
January 2018,  production was  slightly down again.   She  said a                                                               
simple economic principle  is that if a product  is highly taxed,                                                               
there  is  less  production.    She  suggested  the  proposal  is                                                               
backwards,  and to  encourage production,  the  state should  not                                                               
increase  taxes   as  production   goes  up  at   higher  prices.                                                               
Representative Johnson urged for more evaluation.                                                                               
                                                                                                                                
7:30:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TALERICO encouraged  the  committee  to obtain  a                                                               
production cost [analysis] for  the various jurisdictions [listed                                                               
on  slide 7].    He advised  Alaska is  in  competition with  the                                                               
Permian Basin  in Wyoming; although Wyoming's  effective tax rate                                                               
is 13.4  percent, the oil wells  in the Permian Basin  are within                                                               
70 miles of  the refinery and the tankers,  and Alaska's pipeline                                                               
[to  marine  transportation]  is  800  miles  long,  which  would                                                               
account  for a  difference  in production  cost.   Representative                                                               
Talerico questioned  whether the committee  has access to  a good                                                               
comparison [of  production cost] that is  sufficient to determine                                                               
an  effective  tax  rate.   Further,  he  related  Northrim  Bank                                                               
reported  2017 non-oil  and gas  construction spending  in Alaska                                                               
was  about  $1.57  billion   [document  not  provided];  however,                                                               
Representative  Talerico said  his constituents  who work  in the                                                               
oil industry reported  even in a very low year,  compared to 2013                                                               
and 2014, [in  2017] the industry spent $2.43 billion  on oil and                                                               
gas construction projects throughout the  state.  He cautioned an                                                               
impact to [oil  and gas industry spending] "goes  well beyond the                                                               
oil and gas  industry."  He restated the  importance of gathering                                                               
expense  information and  related  his  personal observations  in                                                               
Texas  and  Wyoming.   Additional  information  important to  the                                                               
committee  would  be:    spending  by  support  services  related                                                               
directly   and   indirectly   to   the   industry,   competitors'                                                               
construction spending, and industry reinvestment.                                                                               
                                                                                                                                
CO-CHAIR TARR said  industry is not required  to provide spending                                                               
plans  or  privileged  tax information  that  would  provide  the                                                               
information  needed to  compile  the  [production cost]  document                                                               
requested.      She   directed  attention   to   the   PowerPoint                                                               
presentation  entitled, "Analysis  of  HB 288  Increase to  Gross                                                               
Minimum  Tax  ...," dated  1/26/18  [previously  provided in  the                                                               
committee  packet at  the meeting  of 1/26/18].   Slide  9 was  a                                                               
revenue  graph  which illustrated  minimum  tax  rates; slide  14                                                               
listed historical average tax rates;  slide 18 indicated that the                                                               
effect of HB 288 on the [breakeven price] of oil would be $1.                                                                   
                                                                                                                                
7:36:25 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE BIRCH remarked:                                                                                                  
                                                                                                                                
     Earlier we  had a presentation [document  not provided]                                                                    
     from  an  oil  and   gas  consultant  regarding  ...  a                                                                    
     comparison if you  will, . ... It's  basically how much                                                                    
     the producers earn  for $60 barrel of oil.   This was a                                                                    
     basically  by our  legislative oil  and gas  consultant                                                                    
     ...  presentation in  January.   The  west Texas  shows                                                                    
     about  a  $31 ...  producer  earnings,  it shows  North                                                                    
     Slope at  $12 and  then new  Alaska fields  at [$1.50].                                                                    
     And I  think that, you  know, I'd be interested  in how                                                                    
     the consultant  ... we're using, how  they would assess                                                                    
     this because  this doesn't  appear very  attractive for                                                                    
     inducing  new  investment  in  my   view  ...  and  I'm                                                                    
     concerned that if  we start, you know,  cranking up ...                                                                    
     there's  not a  lot of  room in  here for  ....   And I                                                                    
     think even on  the chart that you had  there below $60,                                                                    
     under the prior  tax regime ... we  would have received                                                                    
     less  than   we're  receiving  today.     ...    [This]                                                                    
     represents the  problem that we're up  against here, is                                                                    
      that we have to make sure that we're doing the very                                                                       
     best we can to attract investment.                                                                                         
                                                                                                                                
CO-CHAIR TARR stated information from  DOR is that the production                                                               
tax  value (PTV)  [projected at  an oil  price of  $60] would  be                                                               
$23.35,  and  the  tax  would   be  [$8.17],  which  is  all  the                                                               
information that is available to the committee.                                                                                 
                                                                                                                                
REPRESENTATIVE   BIRCH  said,   "This  is   based  on   the,  our                                                               
legislative oil  consultant and  it's part of  their oil  and gas                                                               
"102 presentation ...." [document not provided].                                                                                
                                                                                                                                
REPRESENTATIVE  PARISH expressed  skepticism  about trusting  the                                                               
word  of   the  oil   and  gas  industry.     He   said  industry                                                               
representatives  successfully  protect  the  interests  of  their                                                               
shareholders,  and  legislators  must protect  the  interests  of                                                               
[Alaskans].  He  expressed his interest in knowing  the effect of                                                               
Alaska's  tax  structure on  industry's  rate  of investment  and                                                               
production, and  noted the proportion of  nonresidents working on                                                               
the North  Slope has  never been  higher.   Representative Parish                                                               
restated  his  interest in  obtaining  "good  data" on  long-term                                                               
investment and productivity.                                                                                                    
                                                                                                                                
7:41:07 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR  opined it  is difficult to  glean the  causal data                                                               
requested by  Representative Parish because [oil]  price has been                                                               
a  dominant influence  on industry  investment; she  acknowledged                                                               
oil and gas operations on the  North Slope are expensive and more                                                               
difficult;  however, its  existing infrastructure  was "paid  for                                                               
many years  ago."  She  observed DOR  can provide a  breakdown on                                                               
tax credits invested  in projects that have - and  have not - led                                                               
to new  production, and extensively reviewed  aspects of Alaska's                                                               
tax structure that she characterized as "mistakes."                                                                             
                                                                                                                                
REPRESENTATIVE  JOHNSON  advised  her  constituents  are  greatly                                                               
affected  by the  oil industry  thus she  could not  separate the                                                               
interests of the  oil companies from that of the  state; in fact,                                                               
for  both   of  those  interests  "it   goes  hand-in-hand."  She                                                               
supported  the earlier  request  for a  production forecast  that                                                               
reflects "different  things" and  inquired as  to whether  an oil                                                               
and gas legislative consultant was available for testimony.                                                                     
                                                                                                                                
CO-CHAIR  TARR said  the Legislative  Budget and  Audit Committee                                                               
(JBUD)  consultants   are  not  available  to   testify  on  this                                                               
legislation;  she  related  comments   from  an  earlier  private                                                               
conversation  and  offered  to request  authorization  from  JBUD                                                               
allowing  the  committee  to  ask   questions  of  a  legislative                                                               
consultant.                                                                                                                     
                                                                                                                                
7:46:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON   stressed  there  are   many  unanswered                                                               
questions related to HB 288 and  asked whether HB 288 was related                                                               
to [the administration's proposal to reimburse tax credits].                                                                    
                                                                                                                                
CO-CHAIR  TARR said  HB 288  and [the  administration's proposal]                                                               
are two separate bills.                                                                                                         
                                                                                                                                
REPRESENTATIVE JOHNSON opined the bill needs additional work.                                                                   
                                                                                                                                
REPRESENTATIVE   PARISH  requested   the  committee   execute  an                                                               
agreement on  the goals of an  oil tax structure that  would then                                                               
be  submitted   to  a  professional  consultant   with  extensive                                                               
experience in  the oil  and gas industry,  who could  develop the                                                               
committee's goals into a long-standing tax structure.                                                                           
                                                                                                                                
CO-CHAIR  TARR  recalled  a  similar   request  in  2017  led  to                                                               
[provisions in House  Bill 111 that passed in the  House but were                                                               
removed from  the version  passed by  the Senate].   She  said at                                                               
that time  recommendations by  the consultant  were:   delink tax                                                               
rates from oil  prices; address the problems caused  by where the                                                               
per barrel  credit applies; reduce  the base rate of  35 percent;                                                               
tax  from PTV  to  retain a  true net  profits  system; defer  to                                                               
industry   in  a   low-price   environment;   obtain  much   more                                                               
information  to evaluate  expenditures.   Last year,  one of  the                                                               
unmet goals  for House  Bill 111  was to  establish a  tax system                                                               
that would  be in place  for five to  ten years; however,  due to                                                               
the amount  of time needed to  facilitate an overhaul of  the tax                                                               
system, CS for HB 288 addresses only the minimum tax.                                                                           
                                                                                                                                
7:51:12 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
CO-CHAIR JOSEPHSON returned the gavel to Co-Chair Tarr.                                                                         
                                                                                                                                
7:53:20 PM                                                                                                                    
                                                                                                                                
The committee took a brief at-ease.                                                                                             
                                                                                                                                
There followed  a short  discussion on HB  315 and  the committee                                                               
returned to HB 288.                                                                                                             
                                                                                                                                
7:53:33 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR  removed her objection  to the motion to  adopt the                                                               
committee  substitute for  HB 288.    Without further  objection,                                                               
Version D was adopted.                                                                                                          
                                                                                                                                
[HB 288 was held over.]                                                                                                         
                                                                                                                                
        HB 315-CONFIDENTIALITY OF ANIMAL & CROP RECORDS                                                                     
                                                                                                                                
7:53:48 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR announced that the  next order of business would be                                                               
HOUSE BILL  NO. 315, "An  Act relating to the  confidentiality of                                                               
certain  records  on animals  and  crops;  and providing  for  an                                                               
effective date."                                                                                                                
                                                                                                                                
7:53:58 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  TARR  moved to  adopt  Amendment  1,  labeled AM  -  1,                                                               
2/14/18, which read [original punctuation provided]:                                                                            
                                                                                                                                
     Page 2, line 7, following "law,":                                                                                          
          Insert "(1)"                                                                                                          
                                                                                                                                
     Page 2, line 11, following "public":                                                                                       
          Insert ";                                                                                                             
                                                                                                                                
               (2)    the   Department    of   Environmental                                                                    
     Conservation shall,  at the  request of  the Department                                                                    
     of  Natural Resources,  disclose to  the Department  of                                                                    
     Natural  Resources   records  necessary   to  implement                                                                    
     programs  of   the  Department  of   Natural  Resources                                                                    
     designed   to    increase   consumer    awareness   and                                                                    
     consumption of  Alaska agriculture  products identified                                                                    
     by  the "Alaska  Grown"  trademark;  the Department  of                                                                    
     Natural  Resources  shall maintain  confidentiality  of                                                                    
     the records disclosed under this paragraph"                                                                                
                                                                                                                                
CO-CHAIR JOSEPHSON objected for discussion purposes.                                                                            
                                                                                                                                
7:54:33 PM                                                                                                                    
                                                                                                                                
CHRISTINA CARPENTER, Director,  Division of Environmental Health,                                                               
Department  of  Environmental  Conservation  (DEC),  stated  that                                                               
Amendment  1,  proposed  at  the request  of  the  Department  of                                                               
Natural  Resources  (DNR), would  allow  DEC  to share  with  DNR                                                               
information from  animal importation  records held by  the Office                                                               
of  the State  Veterinarian,  Division  of Environmental  Health,                                                               
DEC; said  information would allow  the Division  of Agriculture,                                                               
DNR, to verify  the eligibility of Alaska meat  producers who are                                                               
participating in  the Alaska Grown  program [administered  by the                                                               
Division of Agriculture, DNR].                                                                                                  
                                                                                                                                
CO-CHAIR JOSEPHSON questioned whether  the purpose of Amendment 1                                                               
would be to place this authority in the proper statute.                                                                         
                                                                                                                                
MS.  CARPENTER   said  correct.     Sharing   the  aforementioned                                                               
information would allow DNR to verify  when, or if, an animal was                                                               
imported to  confirm whether the  animal or animals  are eligible                                                               
for the certification.                                                                                                          
                                                                                                                                
CO-CHAIR  TARR related  her understanding  that imported  animals                                                               
have  been sold  as Alaska  Grown,  although they  have not  been                                                               
living in the  state for 51 percent of  their lifetime; Amendment                                                               
1 would protect the brand.                                                                                                      
                                                                                                                                
7:57:29 PM                                                                                                                    
                                                                                                                                
CO-CHAIR JOSEPHSON removed his objection to Amendment 1.                                                                        
                                                                                                                                
There  followed a  short discussion  describing  how Amendment  1                                                               
would be incorporated into the bill.                                                                                            
                                                                                                                                
REPRESENTATIVE RAUSCHER  asked whether  there would  be testimony                                                               
from  the Division  of Agriculture,  DNR, or  Farm Bureau,  Inc.,                                                               
regarding the amendment.                                                                                                        
                                                                                                                                
MS. CARPENTER restated the amendment  was requested by DNR and is                                                               
supported by DNR.                                                                                                               
                                                                                                                                
CO-CHAIR  TARR  clarified  the   Division  of  Agriculture  is  a                                                               
division of DNR.                                                                                                                
                                                                                                                                
There being no further objection, Amendment 1 was adopted.                                                                      
                                                                                                                                
7:59:44 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TARR  moved to adopt Amendment  2, labeled AM -  2 to HB                                                               
315, 2/23/2015, which read [original punctuation provided]:                                                                     
                                                                                                                                
     Page 1, line 11, following "individual;":                                                                                  
      Insert "or"                                                                                                               
                                                                                                                                
      Page 2, lines 5 - 6:                                                                                                      
      Delete"; or                                                                                                               
       (3)  are trade secrets or proprietary business or                                                                        
     financial information"                                                                                                     
     Page 2, line 9:                                                                                                            
      Delete "any records that are"                                                                                             
      Insert "information from a record"                                                                                        
                                                                                                                                
      Page 2, line 11, following "public":                                                                                      
       Insert "and that disclosure of the information is                                                                        
     necessary to address a threat to the health                                                                                
      or safety of the animal, crop, or public"                                                                                 
                                                                                                                                
CO-CHAIR JOSEPHSON objected for discussion purposes.                                                                            
                                                                                                                                
8:00:08 PM                                                                                                                    
                                                                                                                                
MS. CARPENTER said Amendment 2  was requested by stakeholders who                                                               
are   concerned   about   DNR  releasing   proprietary   business                                                               
information  or trade  secrets;  the  amendment deletes  language                                                               
specific to  releasing business information.   Also,  Amendment 2                                                               
expands  proposed [subsection]  (b) to  clarify only  information                                                               
from records,  and not  actual records, may  be disclosed  in the                                                               
event of a public health risk.                                                                                                  
                                                                                                                                
CO-CHAIR JOSEPHSON  surmised in a  public health event,  [DNR and                                                               
/or DEC] would paraphrase or summarize the needed information.                                                                  
                                                                                                                                
MS. CARPENTER said correct.                                                                                                     
                                                                                                                                
REPRESENTATIVE PARISH  said lines 9  and 10 of Amendment  2 imply                                                               
there would be  a redaction of records and asked  for an estimate                                                               
of the staff hours needed to do so.                                                                                             
                                                                                                                                
MS. CARPENTER  said she  was unsure; however,  DEC is  already in                                                               
the  practice of  redacting and  summarizing information  for the                                                               
U.S.  Department  of  Agriculture  and  other  entities  thus  no                                                               
additional staff hours would be required.                                                                                       
                                                                                                                                
REPRESENTATIVE PARISH directed  attention to the bill  on page 2,                                                               
lines 7-11, which read:                                                                                                         
                                                                                                                                
     (b)  Notwithstanding  (a) of this section  or any other                                                                    
     provision  of  law,  the  Department  of  Environmental                                                                    
     Conservation  and the  Department of  Natural Resources                                                                    
     may  disclose  any records  that  are  subject to  this                                                                    
     section    if   the    Department   of    Environmental                                                                    
     Conservation  or the  Department  of Natural  Resources                                                                    
     determines there  is a threat  to the health  or safety                                                                    
     of an animal, a crop, or the public.                                                                                       
                                                                                                                                
REPRESENTATIVE PARISH  directed attention to  lines 13 and  14 of                                                               
Amendment 2 and asked whether  the amendment brings any change to                                                               
the  standard of  proof  by  adding that  the  disclosure of  the                                                               
information is necessary to address the threat.                                                                                 
                                                                                                                                
MS.  CARPENTER said  the department  seeks to  further limit  the                                                               
release of said disclosure to only "when necessary."                                                                            
                                                                                                                                
8:05:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PARISH asked whether  changing the language of the                                                               
bill on page  2, line 9, from "may" disclose  to "shall" disclose                                                               
would  allow the  department to  "better exercise  the discretion                                                               
that already exists within this proposed legislation?"                                                                          
                                                                                                                                
MS. CARPENTER agreed.  She said,  "... it would further limit the                                                               
information that  we would  have to disclose  ... [and]  it would                                                               
raise the bar  on what ... would  be disclosed in the  event of a                                                               
public health threat."                                                                                                          
                                                                                                                                
REPRESENTATIVE  PARISH  questioned  the purpose  of  Amendment  2                                                               
because the  language in the  bill is already  permissive, rather                                                               
than prescriptive.                                                                                                              
                                                                                                                                
CO-CHAIR TARR remarked:                                                                                                         
                                                                                                                                
     As  I  understand it,  is,  what's  being deleted,  the                                                                    
     "trade  secrets or  proprietary  business or  financial                                                                    
     information,"  that's the  part that  stakeholders have                                                                    
     concerns  about, and  this is  an attempt  to eliminate                                                                    
     that concern,  but also have  the space to  release the                                                                    
     records.                                                                                                                   
                                                                                                                                
MS. CARPENTER said correct.                                                                                                     
                                                                                                                                
REPRESENTATIVE TALERICO pointed out section  1 of HB 315 does not                                                               
contain a reference to "the  disclosure of necessary information"                                                               
and opined the intent of the amendment was to do so.                                                                            
                                                                                                                                
REPRESENTATIVE PARISH asked,  "Could the state be  taken to court                                                               
over  the point  of whether  or not  a piece  of information  was                                                               
actually necessary?"                                                                                                            
                                                                                                                                
MS. CARPENTER deferred to the Department of Law (DOL).                                                                          
                                                                                                                                
8:08:39 PM                                                                                                                    
                                                                                                                                
JENNIFER    CURRIE,    Senior   Assistant    Attorney    General,                                                               
Environmental Section,  Civil Division(Anchorage),  DOL, restated                                                               
Representative Parish's question.                                                                                               
                                                                                                                                
REPRESENTATIVE PARISH clarification his question.                                                                               
                                                                                                                                
MS. CURRIE  opined any statute  is subject to  interpretation and                                                               
thus the  state could be subject  to a lawsuit; however,  in this                                                               
regard, because the statute is  centered on the discretion of the                                                               
Office  of   the  State  Veterinarian,   the  necessity   of  the                                                               
disclosure would be given discretion.                                                                                           
                                                                                                                                
CO-CHAIR JOSEPHSON  surmised in a  lawsuit that alleges  a breach                                                               
in the release  of information, the plaintiff would  have to show                                                               
damages, which would be difficult.                                                                                              
                                                                                                                                
MS. CURRIE said  correct and added that damages would  need to be                                                               
enough to support a lawsuit.                                                                                                    
                                                                                                                                
CO-CHAIR  JOSEPHSON directed  attention to  the bill  on page  2,                                                               
line 11,  [text previously provided]  and questioned  whether the                                                               
language "an animal" could mean any animal.                                                                                     
                                                                                                                                
MS. CURRIE answered yes.                                                                                                        
                                                                                                                                
8:11:54 PM                                                                                                                    
                                                                                                                                
CO-CHAIR JOSEPHSON withdrew his objection to Amendment 2.                                                                       
                                                                                                                                
REPRESENTATIVE PARISH  objected to  Amendment 2.   He  opined the                                                               
amendment would leave the state  exposed to additional liability.                                                               
Representative  Parish removed  his  objection.   There being  no                                                               
further objection, Amendment 2 was adopted.                                                                                     
                                                                                                                                
CO-CHAIR TARR asked for discussion on HB 315, as amended.                                                                       
                                                                                                                                
                                                                                                                                
REPRESENTATIVE  JOHNSON  asked  Dr.  Gerlach if  there  were  any                                                               
problems  in  terms of  business  or  trade secrets  for  farmers                                                               
importing farm animals,  or with the information  that the Office                                                               
of the State Veterinarian would have to disclose.                                                                               
                                                                                                                                
8:13:53 PM                                                                                                                    
                                                                                                                                
ROBERT  GERLACH, VMD,  State Veterinarian,  Office  of the  State                                                               
Veterinarian, Division of Environmental  Health, DEC, answered he                                                               
did  not believe  the  amendments would  affect  the business  of                                                               
livestock producers who import animals into the state.                                                                          
                                                                                                                                
REPRESENTATIVE TALERICO asked for  clarification on how an animal                                                               
gets  approved  to  be  imported  into  the  state,  and  whether                                                               
importation  is  approved solely  by  DEC  or  also by  the  U.S.                                                               
Department of Agriculture (USDA).                                                                                               
                                                                                                                                
DR. GERLACH explained  an animal traveling on land  would need to                                                               
meet  the Canadian  requirements necessary  to enter  Canada, and                                                               
meet USDA requirements  to leave the U.S.,  enter another country                                                               
and then reenter the U.S.,  in addition to Alaska's requirements.                                                               
If an  animal is flown  in, or travels  to Alaska via  the Alaska                                                               
Marine Highway  System, the animal  would need to meet  state and                                                               
port regulations.                                                                                                               
                                                                                                                                
REPRESENTATIVE TALERICO surmised a  multitude of regulations must                                                               
be met for an animal transported via land-based transportation.                                                                 
                                                                                                                                
DR. GERLACH answered yes.                                                                                                       
                                                                                                                                
CO-CHAIR JOSEPHSON asked  whether it is legal  to import domestic                                                               
animals that may have a disease.                                                                                                
                                                                                                                                
DR. GERLACH  answered no.   The state relies on  the veterinarian                                                               
at the source of origin to  assess an animal; he acknowledged the                                                               
possibility an animal  might not have symptoms of  an illness but                                                               
is  harboring a  pathogen.   If  there is  a  concern, the  state                                                               
relies  on diagnostic  testing.   He reiterated  all animals  can                                                               
harbor  certain pathogens  and could  transport them;  it is  not                                                               
possible  to test  for every  known pathogen,  so the  state uses                                                               
testing  regulations to  address those  of primary  concern which                                                               
would  pose  a threat  to  the  health  and welfare  of  domestic                                                               
animals or wildlife in Alaska.                                                                                                  
                                                                                                                                
8:17:57 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PARISH asked  whether the actions of  DEC, DNR, or                                                               
the public would  be restricted in the presence  of an infectious                                                               
disease.                                                                                                                        
                                                                                                                                
DR.  GERLACH advised  if animals  came  into the  state and  were                                                               
discovered  to  have  a disease  acquired  during  transport,  or                                                               
exhibited  symptoms   when  they  arrived,  there   would  be  no                                                               
restriction  on  the  state's  ability to  respond  in  order  to                                                               
prevent  the  threat  of  that   disease  to  domestic  stock  or                                                               
wildlife, or to public health.                                                                                                  
                                                                                                                                
REPRESENTATIVE PARISH further inquired  as to whether the ability                                                               
of  a member  of the  general public  to inform  themselves about                                                               
potential disease outbreaks would be constrained by this bill.                                                                  
                                                                                                                                
DR. GERLACH  assured the committee  there is no  restriction upon                                                               
members  of the  general public;  in fact,  his office  regularly                                                               
responds to concerns and provides information in this regard.                                                                   
                                                                                                                                
REPRESENTATIVE RAUSCHER  asked for  clarification on  the state's                                                               
response to a group of animals exhibiting symptoms of disease.                                                                  
                                                                                                                                
DR.  GERLACH  stated  the  state's   response  depends  upon  the                                                               
pathogen,  its  mechanism  of transmission,  and  its  threat  to                                                               
domestic  stock,  wildlife, or  public  health;  for example,  an                                                               
animal exposed  to tuberculosis would be  quarantined and tested.                                                               
If  there were  a high  degree of  concern, the  animal would  be                                                               
returned to its source of origin or euthanized.                                                                                 
                                                                                                                                
8:22:20 PM                                                                                                                    
                                                                                                                                
CO-CHAIR JOSEPHSON  moved to  report HB 315,  as amended,  out of                                                               
committee  with individual  recommendations and  the accompanying                                                               
fiscal  notes.   There  being  no  objection, CSHB  315(RES)  was                                                               
reported out of the House Resources Standing Committee.                                                                         
                                                                                                                                
8:23:46 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Resources Standing Committee meeting was adjourned at 8:23 p.m.                                                                 

Document Name Date/Time Subjects
HB 399 Sponsor Statement 3.26.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 O 3.26.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Sectional Sectional Analysis ver O 3.26.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Fiscal Note-DOR-TAX 3.24.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Fiscal Note-DOR-TAX 3.27.18.pdf HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents DOR Letter 3.26.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents CIT Sector Report FY 2017 3.26.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents - Indirect Expenditure Report Reduced Rate Capital Gains.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents - Indirect Expenditure Report Foreign Royalty.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents - Indirect Expenditure Report Federal Credits.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Additional Documents - Indirect Expenditure Report Stranded Gas.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB 399 Opposing Document - Letter in Opposition 3.28.18.pdf HRES 3/28/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 399
HB315 Transmittal Letter 2.9.18.pdf HJUD 2/9/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB315 ver A 2.9.18.PDF HJUD 2/9/2018 1:00:00 PM
HJUD 2/12/2018 1:30:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB315 Fiscal Note DEC-EHL 2.9.18.PDF HJUD 2/9/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB315 Supporting Document-Public Comment.pdf HJUD 2/9/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB315 Additional Document-DEC Memo Regarding SB164 and Alaska Grown 2.12.18.pdf HJUD 2/12/2018 1:30:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
SB 164
HB 315 Supporting Documents - Homer Swift Creek Ranch 2.8.2018.pdf HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB 315 Additional Documentation - DEC Letter re Alaska Grown 2.14.2018.pdf HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB315 Support, AK WSF Comments.pdf HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/23/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 315
HB 27 Sponsor Statement 3.8.18.pdf HRES 3/9/2018 1:00:00 PM
HRES 3/19/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 27 Ver. D bill 3.8.18.pdf HRES 3/9/2018 1:00:00 PM
HRES 3/19/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 27 Version D Sectional Analysis 3.8.18.pdf HRES 3/9/2018 1:00:00 PM
HRES 3/19/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 27 Fiscal Note - LAW-CIV 3.16.18.pdf HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 27 Fiscal Note DEC 3-2-18 HIGH-RISK CHEMICALS FOR CHILD EXPOSURE 3.8.18.pdf HRES 3/9/2018 1:00:00 PM
HRES 3/19/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 27 Amendment One - D.1 - Rep. Tarr 3.21.18.pdf HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 27
HB 315 amendment two - AM -2 - 2.23.18.pdf HRES 4/2/2018 1:00:00 PM
HB 315
HB 315 amendment one - AM -1 - 2.14.18.pdf HRES 4/2/2018 1:00:00 PM
HB 315
HB260 Sponsor Statement 1.25.18.pdf HFSH 2/20/2018 11:00:00 AM
HRES 3/16/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB260 ver A 1.25.18.pdf HFSH 2/20/2018 11:00:00 AM
HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB 260 Fiscal Note-DFG- 2.16.18.pdf HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB260 Resident Hunters AK Letter of Support.pdf HRES 3/21/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HTRA 2/20/2018 11:00:00 AM
HB 260
HB 260 Supporting Document - Status of Electronic Fish Game licenses, mobile apps and websites in other states 3.15.18.pdf HRES 3/16/2018 1:00:00 PM
HRES 3/21/2018 1:00:00 PM
HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB 260 Amendment One - A.1 - Rep. Tarr 3.20.18.pdf HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB 260 Amendment Two - A.2 - Rep. Tarr 3.27.18.pdf HRES 3/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/4/2018 1:00:00 PM
HB 260
HB288 Sponsor Statement 1.21.18.pdf HRES 1/22/2018 1:00:00 PM
HRES 1/26/2018 1:00:00 PM
HRES 1/29/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB288 ver A 1.16.18.PDF HRES 1/22/2018 1:00:00 PM
HRES 1/26/2018 1:00:00 PM
HRES 1/29/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB 288 CS Version D 3.27.18.pdf HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB 288 Summary of Changes Version A to Version D 3.29.18.pdf HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HB 288
HB 288 Fiscal Analysis for Version D 3.27.18.pdf HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB288 Fiscal Note DOR-TAX 1.20.18.pdf HRES 1/22/2018 1:00:00 PM
HRES 1/26/2018 1:00:00 PM
HRES 1/29/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB288 Sectional Analysis 1.21.18.pdf HRES 1/22/2018 1:00:00 PM
HRES 1/26/2018 1:00:00 PM
HRES 1/29/2018 1:00:00 PM
HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HRES 4/13/2018 1:00:00 PM
HRES 4/14/2018 2:00:00 PM
HRES 4/16/2018 1:00:00 PM
HB 288
HB288 DOR Tax Presentation HRES 1-26-18.pdf HRES 1/26/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 288
HB 288 Supporting Document - Oklahoma Legislature passes tax hikes for teacher pay. Washington Post 3.28.18.pdf HRES 3/30/2018 1:00:00 PM
HRES 4/2/2018 1:00:00 PM
HB 288
HB 288 CS Version D Slide Presentation 3.30.18.pdf HRES 4/2/2018 1:00:00 PM
HB 288