Legislature(1999 - 2000)

05/18/1999 09:05 AM House URS

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
  HOUSE SPECIAL COMMITTEE ON UTILITY RESTRUCTURING                                                                              
                    May 18, 1999                                                                                                
                     9:05 a.m.                                                                                                  
                                                                                                                                
MEMBERS PRESENT                                                                                                                 
                                                                                                                                
Representative Bill Hudson, Chairman                                                                                            
Representative John Cowdery, Vice Chairman                                                                                      
Representative Pete Kott                                                                                                        
Representative Norman Rokeberg                                                                                                  
Representative Brian Porter                                                                                                     
Representative John Davies                                                                                                      
Representative Ethan Berkowitz                                                                                                  
Representative Joe Green (alternate)                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                  
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                              
                                                                                                                                
CONSIDERATION OF ALASKA REGULATION COMMISSION APPOINTEES:                                                                       
                                                                                                                                
Wilfred K. Abbott - Anchorage                                                                                                   
Patricia Maria Demarco - Anchorage                                                                                              
James S. Strandberg - Anchorage                                                                                                 
G. Nanette Thompson - Anchorage                                                                                                 
Burnell Smith - Eagle River                                                                                                     
                                                                                                                                
     - CONFIRMATIONS ADVANCED                                                                                                   
                                                                                                                                
                                                                                                                                
PREVIOUS ACTION                                                                                                                 
                                                                                                                                
No previous action to record.                                                                                                   
                                                                                                                                
WITNESS REGISTER                                                                                                                
                                                                                                                                
WILFRED K. ABBOTT, Appointee                                                                                                    
     to the Alaska Regulatory Commission                                                                                        
9701 Arlene                                                                                                                     
Anchorage, Alaska 99515                                                                                                         
Telephone:  (907) 248-3798                                                                                                      
POSITION STATEMENT:  Testified as appointee to the Alaska                                                                       
                     Regulatory Commission.                                                                                     
                                                                                                                                
PATRICIA MARIA DeMARCO, Appointee                                                                                               
     to the Alaska Regulatory Commission                                                                                        
8101 Oney Circle                                                                                                                
Anchorage, Alaska 99516                                                                                                         
Telephone:  (907) 346-8385                                                                                                      
POSITION STATEMENT:  Testified as appointee to the Alaska                                                                       
                     Regulatory Commission.                                                                                     
                                                                                                                                
JAMES S. STRANDBERG, Appointee                                                                                                  
     to the Alaska Regulatory Commission                                                                                        
3217 Purdue Street                                                                                                              
Anchorage, Alaska 99508                                                                                                         
Telephone:  (907) 278-5812                                                                                                      
POSITION STATEMENT:  Testified as appointee to the Alaska                                                                       
                     Regulatory Commission.                                                                                     
                                                                                                                                
G. NANETTE THOMPSON, Appointee                                                                                                  
     to the Alaska Regulatory Commission                                                                                        
1031 West 4th, Number 200                                                                                                       
Anchorage, Alaska 99501                                                                                                         
Telephone:  (907) 269-5267                                                                                                      
POSITION STATEMENT:  Testified as appointee to the Alaska                                                                       
                     Regulatory Commission.                                                                                     
                                                                                                                                
BURNELL SMITH, Appointee                                                                                                        
     to the Alaska Regulatory Commission                                                                                        
No address provided.                                                                                                            
Eagle River, Alaska                                                                                                             
No telephone provided.                                                                                                          
POSITION STATEMENT:  Testified as appointee to the Alaska                                                                       
                     Regulatory Commission.                                                                                     
                                                                                                                                
STEPHEN CONN                                                                                                                    
Alaska Public Interest Research Group                                                                                           
PO Box 101093                                                                                                                   
Anchorage, Alaska                                                                                                               
Telephone:  (907) 278-3661                                                                                                      
POSITION STATEMENT:  Encouraged the committee to promote an                                                                     
                     education process for the new appointees.                                                                  
                                                                                                                                
ERIC YOULD                                                                                                                      
Alaska Rural Electric Cooperative Association                                                                                   
703 West Tudor                                                                                                                  
Anchorage, Alaska 99503                                                                                                         
Telephone:  (907) 561-6103                                                                                                      
POSITION STATEMENT:  Commended the choice of appointees.                                                                        
                                                                                                                                
ACTION NARRATIVE                                                                                                                
                                                                                                                                
TAPE 99-22, SIDE A                                                                                                              
Number 0001                                                                                                                     
                                                                                                                                
CHAIRMAN BILL HUDSON called the House Special Committee on Utility                                                              
Restructuring meeting to order at 9:05 a.m.  Members present at the                                                             
call to order were Representatives Hudson, Cowdery, Kott, Rokeberg,                                                             
Porter, Davies, Berkowitz and Green (alternate).                                                                                
                                                                                                                                
CONSIDERATION OF ALASKA REGULATION COMMISSION APPOINTEES                                                                        
                                                                                                                                
CHAIRMAN HUDSON announced that the only order of business would be                                                              
the consideration of the appointments to the Alaska Regulatory                                                                  
Commission.                                                                                                                     
                                                                                                                                
Number 0080                                                                                                                     
                                                                                                                                
WILFRED K. ABBOTT, Appointee to the Alaska Regulatory Commission,                                                               
said that he was excited to be a part of this changing regulatory                                                               
arena.  He informed the committee that he was in the U.S. Air Force                                                             
for 28 years.  After retirement from the U.S. Air Force, Mr. Abbot                                                              
was a Building Official for the Municipality of Anchorage for a                                                                 
year during the waning years of construction.  Then he was the                                                                  
Director of the Department of Public Works, Municipality of                                                                     
Anchorage, for a short time after which he became the Director of                                                               
the Office of Emergency Management.  Subsequently, Mr. Abbott                                                                   
worked in the private sector for an environmental firm for a year.                                                              
Finally, Mr. Abbott moved to his current position as the Director                                                               
of Housing Operations, Public Housing Division, Alaska Housing                                                                  
Finance Corporation.  Mr. Abbott commented that there is a lot of                                                               
hard work ahead and he is a hard worker.                                                                                        
                                                                                                                                
Number 0346                                                                                                                     
                                                                                                                                
REPRESENTATIVE COWDERY commented that he met Mr. Abbott when he                                                                 
worked for the Municipality of Anchorage.  Mr. Abbott is very                                                                   
organized, is a hard worker, and would be an asset to this                                                                      
commission.  Representative Cowdery noted that Mr. Abbott was a                                                                 
prisoner of war in Vietnam for six years.                                                                                       
                                                                                                                                
REPRESENTATIVE GREEN asked Mr. Abbott if he was aware of the                                                                    
variety of issues that he would have to pass judgement on.                                                                      
                                                                                                                                
MR. ABBOTT replied, yes and recognized that the commission is a                                                                 
very busy body with varied issues.  Mr. Abbott said that he looked                                                              
forward to those aspects and thrives on such.                                                                                   
                                                                                                                                
REPRESENTATIVE PORTER concurred with Representative Cowdery's                                                                   
comments and welcomed Mr. Abbott.                                                                                               
                                                                                                                                
REPRESENTATIVE DAVIES inquired as to Mr. Abbott's impression of the                                                             
emerging retail competition for telephone utilities and possibly                                                                
electric utilities in the future.                                                                                               
                                                                                                                                
MR. ABBOTT said that he believed that enterprise should be allowed                                                              
to proceed as far as is in the public's interest.                                                                               
                                                                                                                                
Number 0649                                                                                                                     
                                                                                                                                
PATRICIA MARIA DeMARCO, Appointee to the Alaska Regulatory                                                                      
Commission, testified via teleconference from Anchorage.  She said                                                              
that she was honored to be suggested for appointment to the Alaska                                                              
Regulatory Commission.  She felt she has been preparing for this                                                                
position for most of her adult life.  Ms. DeMarco informed the                                                                  
committee that she has a doctorate in genetics and has an empirical                                                             
scientists approach to information analysis.  At present, there is                                                              
an intersection between the march of technology and the march of                                                                
information as a basis for business as well as daily life.                                                                      
Regulatory procedure is mired in a tradition which requires                                                                     
innovation and creativity to accommodate the speed with which this                                                              
industry is evolving.  Alaska is a great challenge in the                                                                       
regulatory world due to wide geographic disparities.  If the state                                                              
desires all citizens have the right to appropriate infrastructure                                                               
and utility amenities, there must be a balancing of the risks and                                                               
opportunities in a cost efficient manner.                                                                                       
                                                                                                                                
MS. DeMARCO informed the committee that she has served on the                                                                   
regulatory staff of the Connecticut commission during the time that                                                             
state was dealing with the deregulation of electric, gas, and                                                                   
telecommunications industries simultaneously.  Although the                                                                     
conditions in Connecticut are vastly different than Alaska, the                                                                 
need to accommodate change in a compressed time frame is common to                                                              
many such commissions.  She expressed interest in bringing modern                                                               
technology to the entire state.  The utility infrastructure is a                                                                
significant component of the economic future of Alaska.  The                                                                    
ability to integrate the utility infrastructure efficiently is a                                                                
tremendous opportunity the commission can shape.  In conclusion,                                                                
Ms. DeMarco commented that she looked forward to working with the                                                               
committee.                                                                                                                      
                                                                                                                                
REPRESENTATIVE GREEN asked if in Ms. DeMarco's work with                                                                        
Connecticut, she had become familiar with the type of joint federal                                                             
and state board of universal service as in Alaska.                                                                              
                                                                                                                                
MS. DeMARCO said that was not the case in Connecticut because                                                                   
Connecticut had more stringent rules than the federal government in                                                             
most areas.  The only area of joint jurisdiction was the nuclear                                                                
regulatory review of the nuclear power plant.                                                                                   
                                                                                                                                
REPRESENTATIVE GREEN noted that this joint relationship could be a                                                              
major issue and was happy that Ms. DeMarco was up to speed on that                                                              
issue.                                                                                                                          
                                                                                                                                
Number 0986                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAVIES commented that Ms. DeMarco's background will                                                              
probably be in demand as this process continues.  He inquired as to                                                             
her thoughts of the different challenges which face deregulation of                                                             
electric utilities given the ownership patterns in Alaska.                                                                      
                                                                                                                                
MS. DeMARCO indicated that the lack of connectivity among                                                                       
communities would be more of an issue than ownership.  The                                                                      
deregulation issues are more defined by how service is provided to                                                              
rural areas and therefore, she was interested in technologies that                                                              
could provide more cost efficient service in areas that are not on                                                              
the connected grid.  She noted the importance of tying the                                                                      
structure of the industry to the functions being served in the                                                                  
communities.                                                                                                                    
                                                                                                                                
CHAIRMAN HUDSON expressed the hope that Ms. DeMarco and the other                                                               
members would provide some creativity.  He indicated the need to                                                                
review this issue in the urban as well as rural setting.  He                                                                    
presumed that Ms. DeMarco would be willing to travel.                                                                           
                                                                                                                                
MS. DeMARCO said she looked forward to traveling throughout Alaska.                                                             
She believed the cooperatives were a good structure from which to                                                               
work.  She informed the committee that she has worked for a                                                                     
municipal electric cooperative which represented five communities,                                                              
one of which was only 14 square miles.  There were some interesting                                                             
problems in Connecticut and there are pockets of rural communities.                                                             
                                                                                                                                
REPRESENTATIVE PORTER congratulated Ms. DeMarco and commented that                                                              
she must find someone suitable to replace her at the Anchorage                                                                  
Economic Development Corporation (AEDC).                                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG echoed Representative Porter's comments.                                                                
He noted that Ms. DeMarco has done an extraordinary job at AEDC.                                                                
                                                                                                                                
Number 1251                                                                                                                     
                                                                                                                                
JAMES S. STRANDBERG, Appointee to the Alaska Regulatory Commission,                                                             
testified via teleconference from Anchorage.  He informed the                                                                   
committee that he was born in Anchorage and has worked extensively                                                              
in the public and private sector.  Presently, Mr. Strandberg is a                                                               
consulting engineer in private practice.  He pointed out that the                                                               
bulk of his work has been in energy systems both in the Railbelt                                                                
and rural power systems.  Mr. Strandberg said that he was honored                                                               
to have been selected and believed he could be of service.  He                                                                  
echoed Ms. DeMarco's statements regarding the winds of change                                                                   
across the nation with regard to utility services.  Although his                                                                
experience has been primarily in energy and power systems, he noted                                                             
that he was conscious of the equal importance of telecommunications                                                             
infrastructure.  There is an opportunity in Alaska and these                                                                    
systems will be important in the way Alaska develops.  In                                                                       
conclusion, Mr. Strandberg looked forward to serving on the                                                                     
commission.                                                                                                                     
                                                                                                                                
REPRESENTATIVE GREEN commented that Mr. Strandberg had an                                                                       
impressive dossier.  He wondered if Mr. Strandberg would have to                                                                
guard against any potential or perceived conflict of interest.                                                                  
                                                                                                                                
MR. STRANDBERG stated that he would transfer his projects to                                                                    
colleagues in total in order to eliminate any conflict of interest.                                                             
He did not believe a commissioner could function without doing                                                                  
such.                                                                                                                           
                                                                                                                                
REPRESENTATIVE GREEN mentioned that Mr. Strandberg is a civil and                                                               
mechanical engineer.                                                                                                            
                                                                                                                                
Number 1503                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAVIES welcomed Mr. Strandberg's experience on the                                                               
commission.  He requested that Mr. Strandberg address the                                                                       
challenges Alaska faces with respect to universal service and                                                                   
general approaches to the many rural communities.                                                                               
                                                                                                                                
MR. STRANDBERG acknowledged that he would need to do much study on                                                              
universal service.  With regard to general approaches, he said that                                                             
the commission must consider the needs of the rate payer because                                                                
the goal is to provide reliable, affordable, and dependable service                                                             
to each rate payer.  He reiterated that utilities will be                                                                       
instrumental in the competitiveness of the state.  Therefore, there                                                             
should be strides for good service in the urban areas as well the                                                               
fringes of those urban areas.  With regard to rural areas, Mr.                                                                  
Strandberg has participated in community energy projects which are                                                              
directed towards replacing power cost equalization (PCE) in rural                                                               
areas.  Community energy projects are very important for the PCE                                                                
dilemma.                                                                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG expressed curiosity in Mr. Strandberg's                                                                 
relation to the former Commissioner Harold Strandberg and a friend                                                              
of Representative Rokeberg's, Sig Strandberg (ph).                                                                              
                                                                                                                                
MR. STRANDBERG informed the committee that the former commissioner                                                              
was his uncle and that Sig Strandberg (ph) is his brother.                                                                      
                                                                                                                                
CHAIRMAN HUDSON commented that he liked what he heard from this                                                                 
conversation and was interested in further examination, evaluation                                                              
and suggestions regarding community energy projects.                                                                            
                                                                                                                                
REPRESENTATIVE ROKEBERG asked if Mr. Strandberg felt that the                                                                   
Alaska Regulation Commission should have oversight in the refuse                                                                
industry or the small water utilities.                                                                                          
                                                                                                                                
REPRESENTATIVE BERKOWITZ asked if Mr. Strandberg believed that the                                                              
commission should do what the legislature allows.                                                                               
                                                                                                                                
MR. STRANDBERG said that he was not supportive of regulation unless                                                             
it is clearly shown to be necessary.  While he viewed the refuse                                                                
industry as an energy source, he could not comment on the                                                                       
regulatory side at this time.                                                                                                   
                                                                                                                                
Number 1847                                                                                                                     
                                                                                                                                
G. NANETTE THOMPSON, Appointee to the Alaska Regulatory Commission,                                                             
testified via teleconference from Anchorage.  She informed the                                                                  
committee that she graduated from Stanford University in 1978,                                                                  
after which she attended the University of Washington School of                                                                 
Law.  Ms. Thompson is a member of the Alaska Bar and the Washington                                                             
Bar, but she has practiced in Alaska since her graduation.  She                                                                 
began working in private practice for a large Seattle-based firm.                                                               
The she worked for a year in the Attorney General's office, after                                                               
which she worked for a small Anchorage firm.  During her time at                                                                
the small Anchorage firm, she worked for utility and government                                                                 
clients.  In 1988, Ms. Thompson started her own firm and has been                                                               
in practice for seven years and has continued to represent utility                                                              
and municipal clients.  She also works as a contract hearing                                                                    
officer for various state agencies.  Ms. Thompson left private                                                                  
practice in 1995 and took over the Alaska Public Utilities                                                                      
Commission.  She was confirmed by the legislature, but left the                                                                 
commission when the supreme court ruled that the seat to which she                                                              
had been appointed was not vacant.  Since that time, Ms. Thompson                                                               
returned to the Attorney General's office in the Oil Gas and Mining                                                             
Section.  She mentioned that she was familiar with SB 133 and is                                                                
familiar with the audits that were the basis for this project.                                                                  
Many of the current APUC staff, for whom she has great respect,                                                                 
were present when Ms. Thompson was there in 1995.  She recognized                                                               
the need for change in the organization and its operations.  The                                                                
passage of the Telecommunications Act in 1996 was the beginning of                                                              
massive changes in the regulation of utilities which is the case                                                                
now with electric utilities.  She looked forward to the opportunity                                                             
to be a part of those changes.  Ms. Thompson believed that SB 133                                                               
contains the tools enabling the new commission to respond to the                                                                
changes in the regulatory environment.                                                                                          
                                                                                                                                
REPRESENTATIVE COWDERY commented that a past APUC commissioner, Don                                                             
Schroer, gave Ms. Thompson high marks.                                                                                          
                                                                                                                                
REPRESENTATIVE PORTER also mentioned that former commissioner, Don                                                              
Schroer, had conveyed to him that he enjoyed working with Ms.                                                                   
Thompson.  Representative Porter was pleased to see Ms. Thompson's                                                              
reappointment to the commission.                                                                                                
                                                                                                                                
Number 2044                                                                                                                     
                                                                                                                                
REPRESENTATIVE DAVIES asked Ms. Thompson to comment on the added                                                                
flexibility that was attempted to be built into the hearing                                                                     
structure.  He asked if she felt that would allow the commission to                                                             
move through the backlog more rapidly than in the past.                                                                         
                                                                                                                                
MS. THOMPSON replied yes.  She supported the options given to the                                                               
commission to resolve the various issues the commission faces.  The                                                             
flexibility should allow the work to be accomplished more                                                                       
efficiently and more rapidly.                                                                                                   
                                                                                                                                
REPRESENTATIVE GREEN asked if Ms. Thompson felt this new group                                                                  
would be up to the task, recognizing that there is a learning                                                                   
curve, a large backlog, and a heavy work load.                                                                                  
                                                                                                                                
MS. THOMPSON recognized that as a tremendous challenge for the                                                                  
group, but noted that the group contains a variety of expertise.                                                                
Ms. Thompson viewed the commission as having a dual task to first                                                               
address the backlog in cases and second to look ahead with regard                                                               
to how the commission will do business.  She believed the group to                                                              
be "up to it."                                                                                                                  
                                                                                                                                
REPRESENTATIVE GREEN inquired as to Ms. Thompson's feelings on the                                                              
joint federal and state board of universal services, in particular                                                              
a former member of the national board was able to bring a                                                                       
significant number of dollars to the state.  He asked if she had                                                                
any proposals to regain a seat on the board.                                                                                    
                                                                                                                                
MS. THOMPSON agreed that it was a loss, but she did not have a                                                                  
specific plan to regain a seat.                                                                                                 
                                                                                                                                
Number 2190                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG noted that a key area of concern as                                                                     
identified by the NRA report and the testimony on HB 183 and SB
133, was the timing of this issue.  Senate Bill 133 contains a                                                                  
section which demands regulations by a date certain.  He inquired                                                               
as to Ms. Thompson's thoughts on that issue; can the commission                                                                 
develop regulations meeting statutory requirements in six months?                                                               
                                                                                                                                
MS. THOMPSON stated that the legislature has told the commission it                                                             
must do so and although, it will be a challenge, the commission                                                                 
will do so.  She believed that there is a deadline in the                                                                       
legislation for the end of 1999.                                                                                                
                                                                                                                                
REPRESENTATIVE ROKEBERG mentioned that there was a significant                                                                  
amount of controversy surrounding the advocacy sections of SB 133.                                                              
He asked how she would perceive the direction of the statute to the                                                             
commission in that area.                                                                                                        
                                                                                                                                
MS. THOMPSON said that it is appropriate to have a separate                                                                     
advocacy staff within the commission.  She informed the committee                                                               
that one of the first issues she will address will be which of the                                                              
existing staff and that hired will be part of the advocacy staff.                                                               
                                                                                                                                
REPRESENTATIVE ROKEBERG pointed out that some testimony commented                                                               
on the apparent or appearance of conflict of interest by staff                                                                  
shifting.  Will the direction of the statutory change help that?                                                                
                                                                                                                                
MS. THOMPSON responded that should solve the problem.  She                                                                      
explained that the concern was that in some cases the staff would                                                               
be an advocate while on other cases, the staff would be an advisor.                                                             
The criticism, from the industry and the commission, was that there                                                             
was not the help available to resolve cases with a clear line.                                                                  
Therefore, placing people always in the role of advocate should                                                                 
alleviate that problem.  If there is any difficulty in implementing                                                             
that, she predicted the commission would probably voice that next                                                               
session.                                                                                                                        
                                                                                                                                
CHAIRMAN HUDSON moved on to Burnell Smith who he noted he has                                                                   
worked with for a long time.  They worked together when Chairman                                                                
Hudson was the Chair of the House Oil & Gas Committee.  He                                                                      
commented that Mr. Smith is a fine citizen and asset to this state.                                                             
                                                                                                                                
Number 2369                                                                                                                     
                                                                                                                                
BURNELL SMITH, Appointee to the Alaska Regulatory Commission, said                                                              
that he was honored to be in this position.  He informed the                                                                    
committee that he graduated as an engineer in technology from Texas                                                             
A&M in 1973.  Since graduation, Mr. Smith has been in project                                                                   
construction and came to Alaska in 1980 as a project engineer at                                                                
Tesoro for a construction company.  He fell in love with the state                                                              
and returned in 1983 to work with Tesoro.  Mr. Smith has worked for                                                             
Tesoro for 16 years as project management, project engineer, and                                                                
part-time manager of government affairs and special projects for                                                                
the past six years.  He indicated that his project background would                                                             
be of some benefit to the commission.  He noted that he did not                                                                 
have a telecommunications background, but does have a background in                                                             
electric utilities.  Mr. Smith emphasized that Alaska is growing                                                                
and will bloom in utilities in the future.                                                                                      
                                                                                                                                
REPRESENTATIVE PORTER commented that he has worked well with Mr.                                                                
Smith in the past and he has always given fair and objective input.                                                             
                                                                                                                                
TAPE 99-22, SIDE B                                                                                                              
                                                                                                                                
REPRESENTATIVE BERKOWITZ mentioned that he appreciated all the help                                                             
Mr. Smith provided when there was controversy over a pipeline in                                                                
Representative Berkowitz's district.                                                                                            
                                                                                                                                
REPRESENTATIVE GREEN said that it is great for another engineer to                                                              
be on the commission.  He asked if Mr. Smith foresaw any potential                                                              
conflict of interest with regard to issues that he may be asked to                                                              
regulate.                                                                                                                       
                                                                                                                                
MR. SMITH informed the committee that Tesoro does have an issue in                                                              
front of the docket with the commission.  He stated that he would                                                               
recuse himself from that docket and should be able to remove                                                                    
himself from any conflict of interest.  He noted that he sat on the                                                             
Board of Marine Pilots for almost five years, and he has had to                                                                 
recuse issues in areas involving the Board of Marine Pilots.                                                                    
                                                                                                                                
REPRESENTATIVE COWDERY commented that the Governor made a good                                                                  
choice.  He hoped that the commission recognized the areas which                                                                
need improvement within the commission as well as dealing with the                                                              
backlog.  Representative Cowdery was impressed with all the members                                                             
and he looked forward to working with them.                                                                                     
                                                                                                                                
MR. SMITH noted that he did have a good work ethic and this                                                                     
commission looks as if there will be much work involved.                                                                        
                                                                                                                                
REPRESENTATIVE ROKEBERG echoed Representative Porter's comments                                                                 
regarding Mr. Smith.                                                                                                            
                                                                                                                                
CHAIRMAN HUDSON announced that he would like to schedule a briefing                                                             
at the commission in the fall.  He also indicated the need for the                                                              
commission to keep the committee in the loop.  For the record,                                                                  
Chairman Hudson noted that the Alaska Rural Electric Cooperative                                                                
Association (ARECA) does not have any problems with any of the                                                                  
appointees, although there is concern regarding the lack of                                                                     
institutional knowledge with the group.  Furthermore, Jim Rowe                                                                  
expressed concern that there is no one from telecommunications                                                                  
which Chairman Hudson believed would be a challenge for the                                                                     
commission.                                                                                                                     
                                                                                                                                
Number 2231                                                                                                                     
                                                                                                                                
STEPHEN CONN, Alaska Public Interest Research Group, commented that                                                             
these are extremely complex issues.  The learning curve on                                                                      
telephone deregulation and electric restructuring is immense.                                                                   
Therefore, there will be quite a challenge for new people to deal                                                               
with these issues and receive "centered" guidance, that is to say                                                               
unbiased guidance.  He acknowledged that even he would have a                                                                   
slant, from the rate payer and consumer side.  Mr. Conn expressed                                                               
concern that these new faces will immediately begin to address many                                                             
issues related to utilities.  He said that many of the committee                                                                
members are vastly more knowledgeable with such issues than the                                                                 
appointees, although he was unsure as to how to remedy the                                                                      
situation.  Mr. Conn mentioned that one possibility would be to                                                                 
obtain outside consultants such as CH2M HILL.  He suggested and                                                                 
encouraged the committee to underwrite through appropriations, a                                                                
learning process for the new appointees in order to engage                                                                      
expertise.                                                                                                                      
                                                                                                                                
REPRESENTATIVE ROKEBERG recalled that SB 133 is somewhat quiet                                                                  
regarding consumer protections and therefore, he assumed that                                                                   
existing statute covers those areas.  He asked if Mr. Conn would                                                                
like to suggest any changes to the consumer complaints aspect.                                                                  
                                                                                                                                
MR. CONN commented that Representative Rokeberg's legislation on                                                                
the consumer's bill of rights for electric restructuring was                                                                    
forthright and a model for complaint resolution.  He indicated that                                                             
Representative Rokeberg's legislation should be given additional                                                                
emphasis and passed out.  There is a tremendous need for changes                                                                
which would remain even without restructuring.  Mr. Conn indicated                                                              
that utility restructuring and the consumer side must go "hand in                                                               
glove."  He mentioned that he saw how an uncertain mandate                                                                      
regarding consumers prejudiced the work of the old APUC.  It should                                                             
be made clear what is under the commission's jurisdiction.                                                                      
                                                                                                                                
Number 1900                                                                                                                     
                                                                                                                                
ERIC YOULD, Alaska Rural Electric Cooperative Association, stated                                                               
that ARECA is pleased with this new commission, in particular with                                                              
the appointments of Ms. Thompson and Ms. DeMarco.                                                                               
                                                                                                                                
REPRESENTATIVE PORTER pointed out that in this committee's struggle                                                             
with this issue, the committee "took out professional                                                                           
qualifications and put in a restriction on political affiliations."                                                             
He said, "For the record, these five represent one Republican, one                                                              
Democrat, and three non-partisans; precisely what this committee                                                                
(indisc.)."                                                                                                                     
                                                                                                                                
REPRESENTATIVE ROKEBERG recommended that the new appointees get                                                                 
copies of the NRA report on the commission, the Joint Committee on                                                              
Electric Utility Restructuring, the CH2M HILL report, the minutes                                                               
regarding HB 183 and SB 133, and the record of the House Special                                                                
Committee on Utility Restructuring.  That information would provide                                                             
the appointees with much background.                                                                                            
                                                                                                                                
CHAIRMAN HUDSON announced that staff would provide the appointees                                                               
with a packet.  He congratulated the appointees and was excited                                                                 
about working with the new commission.                                                                                          
                                                                                                                                
Number 1758                                                                                                                     
                                                                                                                                
REPRESENTATIVE KOTT moved to forward the names of Wilfred K.                                                                    
Abbott, Patricia Maria DeMarco, James S. Strandberg, G. Nanette                                                                 
Thompson, and Burnell Smith for the Alaska Regulatory Commission.                                                               
There being no objection, it was so ordered.                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                     
                                                                                                                                
There being no further business before the committee, the House                                                                 
Special Committee on Utility Restructuring meeting was adjourned at                                                             
10:10 a.m.                                                                                                                      

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