Legislature(2007 - 2008)TERRY MILLER GYM

06/04/2008 10:00 AM House RULES


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Audio Topic
09:03:11 AM Start
09:03:25 AM HB3001
09:17:06 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ HB3001 APPROVING AGIA LICENSE TELECONFERENCED
Heard & Held
House Special Subcommittee on AGIA
Joint w/Sen. Special Committee on Energy
Presentation: Review of AGIA Findings &
Determination; Natural Gas Pipeline
Project as proposed by TransCanada Alaska
Company, LLC and Foothills Pipelines Ltd.
(TC Alaska) to the State of Alaska
LB&A Committee Consultants:
Barry Pulliam, Econ One Research, Inc.
Lesa Adair, Muse Stancil & Co.
Dan E. Dickinson, CPA
-- Testimony <Invitation Only> --
                    ALASKA STATE LEGISLATURE                                                                                  
                 HOUSE RULES STANDING COMMITTEE                                                                               
                          June 4, 2008                                                                                          
                           9:03 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative John Coghill, Chair                                                                                              
Representative John Harris                                                                                                      
Representative Anna Fairclough                                                                                                  
Representative Craig Johnson                                                                                                    
Representative Ralph Samuels                                                                                                    
Representative Beth Kerttula                                                                                                    
Representative David Guttenberg                                                                                                 
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Representative Paul Seaton                                                                                                      
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 3001                                                                                                             
"An Act  approving issuance of  a license by the  commissioner of                                                               
revenue and the commissioner of  natural resources to TransCanada                                                               
Alaska Company,  LLC and  Foothills Pipe  Lines Ltd.,  jointly as                                                               
licensee, under the Alaska Gasline  Inducement Act; and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
          - SUBCOMMITTEE ASSIGNED                                                                                               
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB3001                                                                                                                  
SHORT TITLE: APPROVING AGIA LICENSE                                                                                             
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
06/03/08       (H)       READ THE FIRST TIME - REFERRALS                                                                        
06/03/08       (H)       RLS                                                                                                    
06/03/08       (H)       WRITTEN FINDINGS & DETERMINATION                                                                       
06/04/08       (H)       RLS AT 9:00 AM CAPITOL 120                                                                             
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
No witnesses to record                                                                                                          
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
                                                                                                                                
CHAIR  JOHN COGHILL  called the  House  Rules Standing  Committee                                                             
meeting  to  order  at  9:03:11  AM.    Representatives  Coghill,                                                             
Harris,  Fairclough, Johnson,  Samuels, Guttenberg,  and Kerttula                                                               
were  present at  the  call to  order.   Also  in attendance  was                                                               
Representative Seaton.                                                                                                          
                                                                                                                                
HB3001-APPROVING AGIA LICENSE                                                                                                 
                                                                                                                                
9:03:25 AM                                                                                                                    
                                                                                                                                
CHAIR COGHILL announced that the  only order of business would be                                                               
HOUSE BILL NO.  3001, "An Act approving issuance of  a license by                                                               
the  commissioner  of revenue  and  the  commissioner of  natural                                                               
resources to  TransCanada Alaska Company, LLC  and Foothills Pipe                                                               
Lines  Ltd.,  jointly  as  licensee,  under  the  Alaska  Gasline                                                               
Inducement Act; and providing for an effective date."                                                                           
                                                                                                                                
CHAIR  COGHILL   explained  that   the  plan   is  to   assign  a                                                               
subcommittee that  will facilitate  the proceedings  scheduled to                                                               
consider the  findings and determinations  of the  Alaska Gasline                                                               
Inducement Act (AGIA) by the  entire legislature.  The intention,                                                               
he  relayed, is  to  keep HB  3001 in  the  House Rules  Standing                                                               
Committee while the presentations and public comment occur.                                                                     
                                                                                                                                
9:04:04 AM                                                                                                                    
                                                                                                                                
CHAIR COGHILL announced that members  of the subcommittee on AGIA                                                               
will be  Representatives Harris, chair, Samuels,  vice chair, and                                                               
Kerttula.    He  explained  that  if  Representatives  Harris  or                                                               
Samuels are unable  to attend a hearing, he will  attend in their                                                               
stead.     There   was  no   objection   to  the   aforementioned                                                               
subcommittee membership.   He then  noted the meetings  in Juneau                                                               
will be held in the Terry Miller Legislative Office Building.                                                                   
                                                                                                                                
9:05:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE KERTTULA  reiterated that the  subcommittee merely                                                               
facilitates  the meetings,  and added  that all  members will  be                                                               
allowed to participate in the meetings  in a fashion similar to a                                                               
committee of the whole.                                                                                                         
                                                                                                                                
CHAIR COGHILL noted  his agreement, and added  that the intention                                                               
is to  ensure all  legislators are as  informed as  possible with                                                               
regard to  making the  decision whether to  accept or  reject the                                                               
proposal from  the TransCanada Alaska Company,  LLC (TransCanada)                                                               
[and Foothills  Pipe Lines Ltd.]  proposal to the  governor under                                                               
AGIA.  He reiterated that HB 3001 would be held in committee.                                                                   
                                                                                                                                
9:06:22 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE SAMUELS informed the  committee that the following                                                               
consultants  to the  Legislative Budget  and Audit  Committee are                                                               
present  today:   Barry Pulliam,  Econ One  Research, Inc.;  Lesa                                                               
Adair,   Muse   Stancil   and   Company;   and   Dan   Dickinson.                                                               
Additionally,  Dr.  John Neary  and  Bill  Mogel, Attorney,  Saul                                                               
Ewing  LLP, Federal  Energy Regulatory  Commission (FERC)  are in                                                               
town and will be able to provide comments regarding rate making.                                                                
                                                                                                                                
9:07:41 AM                                                                                                                    
                                                                                                                                
CHAIR COGHILL  noted that  the House will  meet jointly  with the                                                               
Senate Special Committee on Energy.                                                                                             
                                                                                                                                
9:07:57 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  KERTTULA,  recalling  some  of  the  benefits  of                                                               
holding round  table meetings  on past  issues, related  that she                                                               
likes the idea of round table  meetings.  Therefore, she asked if                                                               
there  would be  an opportunity  at some  point to  hold meetings                                                               
that include the administration and the producers.                                                                              
                                                                                                                                
REPRESENTATIVE SAMUELS said that  he hasn't had any conversations                                                               
with  the  producers  regarding participation  in  this  process.                                                               
However,  an invitation  was extended  to ConocoPhillips  Alaska,                                                               
Inc.,  to  review  its  Denali   Project  at  various  locations.                                                               
Representative  Samuels  pointed  out that  all  the  consultants                                                               
won't  attend  every meeting  throughout  the  state.   Once  the                                                               
meetings  throughout the  state  have ended,  all  those who  are                                                               
available can meet together in Juneau after July 4th.                                                                           
                                                                                                                                
9:09:36 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HARRIS welcomed  those from  TransCanada to  this                                                               
open and transparent process, which  he said is best accomplished                                                               
by having all sides at the table and presenting the facts.                                                                      
                                                                                                                                
9:10:43 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE   FAIRCLOUGH,   recalling   the   administration's                                                               
presentation  of TransCanada's  proposal, expressed  the need  to                                                               
challenge the economic  models.  She related that  there was some                                                               
concern that  the administration  was presenting under  the Monte                                                               
Carlo  concept,   economics  that  weren't  how   the  return  on                                                               
investments is actually calculated.                                                                                             
                                                                                                                                
REPRESENTATIVE  SAMUELS  opined   that  various  consultants  and                                                               
economists  may   provide  different  answers.     Representative                                                               
Samuels  further  opined   that  everyone,  including  ExxonMobil                                                               
Corporation,  TransCanada,   and  the  administration   do  their                                                               
economics differently.   However, one can't discount  how a given                                                               
entity views the situation.  He  said that the consultants can be                                                               
asked to  analyze whatever  is desired, but  [there must  be some                                                               
structure to the request process].                                                                                              
                                                                                                                                
9:12:31 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE FAIRCLOUGH  specified that the issue  was that the                                                               
criteria or the toggles are  different.  The Monte Carlo approach                                                               
had factors that  she viewed as valuable, including  time and the                                                               
value  of  money.   However,  she  said  she  was told  that  the                                                               
McKenzie Woods  report used different  criteria.   Therefore, she                                                               
inquired as to the underlying criteria and how it was weighted.                                                                 
                                                                                                                                
9:13:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON surmised  then that Representative Samuels                                                               
wanted requests/questions to go through his office.                                                                             
                                                                                                                                
REPRESENTATIVE  SAMUELS suggested  that  questions  can be  asked                                                               
directly to  the consultants, but  model analyzation  requests or                                                               
similar  requests  should   go  through  Representative  Samuels'                                                               
office.  He  noted that all questions and answers  will be put on                                                               
the Legislative Budget and Audit Committee web site.                                                                            
                                                                                                                                
9:14:43 AM                                                                                                                    
                                                                                                                                
CHAIR  COGHILL requested  that  questions  given to  subcommittee                                                               
members are brought forward during [the forthcoming meetings].                                                                  
                                                                                                                                
9:15:10 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GUTTENBERG inquired as  to who will facilitate the                                                               
joint meetings.                                                                                                                 
                                                                                                                                
CHAIR COGHILL answered  that it'll be a combination  of the House                                                               
&  Senate  with  Representative  Harris or  Samuels  and  Senator                                                               
Huggins helping to facilitate the meetings.                                                                                     
                                                                                                                                
9:16:07 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  HARRIS  explained that  although  HB  3001 has  a                                                               
couple  of fiscal  notes, it  wasn't  sent to  the House  Finance                                                               
Committee   because  there   is  no   appropriations  legislation                                                               
attached.   Therefore, the  fiscal notes  are hollow,  based upon                                                               
future   appropriations  legislation   that  would   provide  for                                                               
disbursement of the funds.                                                                                                      
                                                                                                                                
[HB 3001 was held over.]                                                                                                        
                                                                                                                                
9:17:06 AM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Rules Standing Committee meeting was adjourned at 9:17 a.m.                                                                     

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