Legislature(1993 - 1994)
03/22/1993 09:07 AM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
MINUTES SENATE FINANCE COMMITTEE March 22, 1993 9:07 a.m. TAPES SFC-93, #41, Side 2 (370-end) SFC-93, #43, Side 1 (000-end) SFC-93, #43, Side 2 (575-349) CALL TO ORDER Senator Drue Pearce, Co-chair, convened the meeting at approximately 9:07 a.m. PRESENT In addition to Co-chairs Pearce and Frank, Senators Kelly, Kerttula, and Sharp were present. Senator Rieger and Senator Jacko arrived soon after the meeting began. SO ATTENDING: Senator Lincoln; Representative Hanley; Shelby Stastny, Director, Office of Management and Budget; Chris Gates, Director, Division of Economic Development, Dept. of Commerce and Economic Development; Jim Kohler, Executive Director, Southeast Conference; Jon Tillinghast, Chugach Electric; Josh Fink, aide to Senator Kelly; aides to other committee members as well as aides to other members of the legislature. SUMMARY INFORMATION SSSB 71 - Act relating to emergency medical services; and repealing obsolete references to the Statewide Health Coordinating Council and health systems agencies. CSSB 71 (Finance) was REPORTED OUT of committee with a zero SFC fiscal note for the Dept. of Health and Social Services and a zero note from the Dept. of Commerce and Economic Development. SB 82 - Act relating to the Dalton Highway. CSSB 82 (TRA) was REPORTED OUT of committee with a $99.0 SFC fiscal note for the Dept. of Public Safety, a $16.1 note from the Dept. of Fish and Game, and zero notes from the Dept. of Natural Resources and Dept. of Transportation and Public Facilities. SB 84 - Act relating to fees for identification cards and certain motor vehicle licenses and permits; to licenses issued to drivers and to revocation of a license to drive; and providing for an effective date. The bill was REPORTED OUT of committee with a $146.7 SFC fiscal note for the Dept. of Public Safety. SB 154 - Act relating to the economic development grant program; and providing for an effective date. Discussion was had with Shelby Stastny, Chris Gates, and Jim Kohler. The bill was subsequently HELD in committee for preparation of a new fiscal note. CSHB 116 - Act amending the manner of determining the royalty (FIN) received by the state on gas production, and title am directing the commissioner of natural resources to accept, under certain circumstances, the contract price agreed to between a lessee of federal land and a gas or electric utility as the value of the federal government's royalty share from natural gas production on federal land from which the state is entitled under applicable federal law to receive a share of the royalty on gas production; and providing for an effective date. The bill was REPORTED OUT of committee with a zero fiscal note from the Dept. of Natural Resources. CS FOR HOUSE BILL NO. 116(FIN)(title am) An Act amending the manner of determining the royalty received by the state on gas production, and directing the commissioner of natural resources to accept, under certain circumstances, the contract price agreed to between a lessee of federal land and a gas or electric utility as the value of the federal government's royalty share from natural gas production on federal land from which the state is entitled under applicable federal law to receive a share of the royalty on gas production; and providing for an effective date. Co-chair Pearce directed that CSHB 116 (Fin)(title am) be brought on for discussion and pointed to the fact that the Senate version, SB 104, is also in committee. She then invited the sponsor, Representative Hanley, to join members at the committee table. (Senator Rieger arrived at this time.) As background information, REPRESENTATIVE HANLEY explained that when oil was discovered in Cook Inlet in the 1960, it was accompanied by "a fair amount of natural gas." At that time there were no markets for that gas. Chugach Electric signed a long-term, twenty-five year contract in 1965 to purchase the gas at 21 cents a thousand cubic feet. There were no other contracts at that time, and Chugach made its decision to build a gas-powered electric generation plant based on that contract. The contract price for the gas was not disputed for approximately twenty years. In 1985, however, the state filed intent stating that it did not feel the contract price was a fair price for royalties paid to the state and that the price should be raised. In response, the legislature introduced legislation that specified that for sales to utilities (as long as it is an arms-length deal between the two contractors), the contract price is the price the state will use for its royalty share. The bill passed, and that has been prevailing law for state leases and subsequent sales of natural gas to utilities. Last year, the mineral management service of the federal government conducted an audit of its leases in this area. Contracts had also been signed by Chugach to purchase natural gas from federal fields. The federal audit determined that the contract price was a fair price for "their royalties . . . ." The state has appealed that decision, claiming the federal government did not receive enough royalties for its gas. The reason behind the appeal is that the state receives 90% of the royalties the federal government collects. While the state is required by state law to use the contract price on state leases, it has appealed the federal decision to use the contract price as well. Representative Hanley acknowledged that the federal government has the ability to determine what it feels is a fair royalty on federal gas leases. In 1988, the federal agency passed a regulation that made clear that it is required to use a contract price similar to state law on federal leases as long the contracts represent "arms-length deals." (Senator Jacko arrived at this time.) In his closing remarks, Representative Hanley reiterated that, in terms of state participation, the proposed bill applies the same standards to federal leases as current law governing state leases. Senator Kerttula asked if representatives from the Dept. of Natural Resources had testified regarding what the cost will be in terms of state royalties. Representative Hanley observed that cost is determined by the difference between the contract price and the true value. The Dept. of Natural Resources provided a zero fiscal note for the bill. The Representative pointed to backup information on the note indicating a total of "$12 million." Approximately half of that amount is interest while the remaining half is actual royalties based on value. Further comments followed by Representative Hanley concerning department use of $1.50 per thousand cubic feet, the Chugach lawsuit following 1985 state intent to raise the royalty, and the subsequent settlement of the lawsuit at 76 cents per thousand cubic feet. He reiterated that the federal government has ruled the contract price fair for federal royalties. It is unclear whether the state will win its appeal. If it does not. There will be no money owed to the state. Discussion followed between Senator Sharp and Representative Hanley regarding 1965 contract provisions for future value of the gas. Representative Hanley noted the retrospective nature of the state charge (1984-87) and problems associated with attempts to apply a surcharge to those who used power during a past time period. JON TILLINGHAST, representing Chugach Electric, next came before committee. He explained that when leases were originally executed, federal regulations applying at the time were clear that the contract prices would be the basis for valuing royalties. The federal government subsequently issued notice to lessees indicating that it would accept the contract price "but in extraordinary circumstance we'll deviate from that contract price." That is the basis of the current dispute. Speaking to fiscal implications of the bill, Mr. Tillinghast said that in 1988, the federal government changed its regulations to accept the contract price in every circumstance. Prospectively, the proposed bill should have no fiscal impact since it merely conforms to current federal law. Fiscal consequences are thus confined to state claims for the audit period 1984-87. Mr. Tillinghast noted that the federal minerals management service has already ruled against DNR at the staff level. DNR has appealed. Senator Rieger directed attention to page 4, lines 2 and 3, and requested an explanation of provisions relating to "an affiliated interest." Mr. Tillinghast said that the language was inserted at Representative Brown's behest. She was concerned that the utility not be related to the lessee or any purchaser of gas or electricity. It is intended to prevent situations whereby a large industrial buyer might establish a dummy utility to take advantage of the law. It seeks to ensure an arms-length distance between the utility and those who buy gas or electricity from the utility. Mr. Tillinghast noted that the term "affiliated interest" as defined in the public utility code is so broad that it would include "almost everybody." He next cited examples of broad application. In response to concerns raised by Senator Rieger that major utilities might trigger "affiliated interest" provisions under the APUC code, Mr. Tillinghast answered: Well, I think they're going to have to structure their affairs to make sure that they're not. For example, they have to make sure that they don't have any directors or officers in common with any of the producers that they buy gas from. If they do, then they are an affiliated interest, and they lose the protections of this bill. They must also ensure that they do not have any service or management contracts with the producers. The fact that they simply buy gas from them is not a service or management contract. Mr. Tillinghast concurred in the legitimate nature of Senator Rieger's concern and reiterated that utilities would have to ensure that they do not become affiliated. End, SFC-93, #41, Side 2 Begin, SFC-93, #43, Side 1 Further discussion followed between Mr. Tillinghast and Senator Sharp regarding situations which might give rise to affiliated status. Senator Kerttula asked if the proposed bill would impact Chugach Electric drilling and production if the utility chose to undertake that effort. Mr. Tillinghast voiced his understanding that neither the law nor the proposed bill would apply to the utility since both deal only with arms- length contracts between two entities. If the producer and the utility are one and the same, the law does not apply. In response to a further question from Senator Kerttula asking if there were similarities between the proposed bill and legislation Mr. Tillinghast might seek on behalf of MAPCO. Mr. Tillinghast explained that peculiarities associated with HB 116 result from the fact that: 1. No precedent is being set. The issue was settled in 1986. Legislative history of 1986 law indicates that lack of application to federal leases was simply an oversight. HB 116 does not break new ground as does proposed TESORO legislation. 2. There is no debate over how much of the benefits will be passed on to Alaskan consumers. Increased royalties will be passed directly to Chugach and in turn to consumers on a dollar per dollar basis. Discussion followed between Mr. Tillinghast and Senator Rieger regarding the sale of power by one utility to another. Mr. Tillinghast assured that there should be no problem as long as the utilities do not have interlocking directors or service management contracts. Co-chair Pearce asked what was added to the bill to effect a title change on the floor of the House of Representatives. Representative Hanley explained that new language relates to changes requested by Representative Brown. Title language was tightened to ensure that the legislation did not become a vehicle to change "a lot of different oil and gas contracts." Referring to page 3, Sec. 4, Co-chair Pearce asked where the section would fit within existing statutes. Mr. Tillinghast explained that it would be placed in temporary and special acts. Senator Jacko asked what would happen should the legislation not pass. He noted other proposals that would raise the cost of power for Alaskans covered by power cost equalization. He then asked who the proposed bill would impact. Representative Hanley again noted uncertainty associated with the fact that federal leases are involved. He again pointed to the fact that the federal government has determined that the contract price is the price upon which royalties are based, and no additional royalties are due. There is thus no 90% additional flow-through to the state. If additional royalties were charged by the federal government, and the state received 90%, consumers in the railbelt would be charged. Representative Hanley advised that when power cost equalization was established, the average price of Fairbanks, Anchorage, and Juneau power costs was used to establish the base rate of 8.5 cents. He acknowledged that a hypothetical argument could be made that retroactive royalty charges would raise rates in the railbelt and subsequently lead to a higher average for power cost equalization as well. That would be a political decision. Discussion followed between Senator Kerttula and Mr. Tillinghast regarding North Slope gas and application of the bill to gas-fired utilities should they be established. Mr. Tillinghast advised that discussion in House Finance led to a determination that the bill should apply to both existing and new fields. Co-chair Pearce called for additional testimony on the bill. None was forthcoming. She then queried members regarding disposition. Senator Kerttula inquired concerning testimony from the administration. The Co-chair said that representatives of the Dept. of Natural Resources were aware of the present hearing. The department has issued no adverse comments. She further advised that the bill was placed in a subcommittee in House Finance, and the subcommittee and Representative Hanley worked closely with department staff in incorporating amendments. Senator Kelly MOVED that CSHB 116 (Fin)(title am) pass from committee with individual recommendations. No objection having been raised, CSHB 116 (Fin)(title am) was REPORTED OUT of committee with a zero fiscal note from the Dept. of Natural Resources. Co-chairs Frank and Pearce and Senators Kelly, Rieger, and Sharp signed the committee report with a "do pass" recommendation. Senators Jacko and Kerttula signed "no recommendation." SPONSOR SUBSTITUTE FOR SENATE BILL NO. 71 An Act relating to emergency medical services; and repealing obsolete references to the Statewide Health Coordinating Council and health systems agencies. Co-chair Pearce directed that SSSB 71 be brought on for discussion. Co-chair Frank explained that review of the Dept. of Health and Social Services fiscal note for the bill concluded that additional positions would not be required. Positions requested in the department note are presently funded through a federal grant which is to be discontinued. It was determined to be inappropriate to use SSSB 71 as the vehicle to fund and continue those positions. Co-chair Frank then suggested that the department note be replaced by a zero Senate Finance note. Co-chair Pearce noted adoption of Senator Leman's "amendment no. 1, corrected" at the March 15, 1993, meeting. She then directed attention to proposed amendments nos. 2 and 3 distributed by Senator Rieger. Senator Rieger MOVED for adoption of amendment no. 2 (copy on file in the permanent Senate Finance file for SB 71). He explained that the amendment would make bill language permissive by substituting "may" for "shall" at page 4, line 18. Additional language changes within the amendment relate to collection of information on EMS patient care. The thrust is to require collection in a format that eases transmission from providers in the field to the department and entry into data bases. Senator Rieger then directed attention amendment no. 3 and explained that it consists of the following proposed intent: It is the intent of the legislature that the department will use a computerized database program for the collection of trauma data. A priority in designing the system should be ease of use for pre-hospital and hospital facilities in providing information to the database through their own use of standard desktop software programs. It is further the intent of the legislature that the trauma injury data collection be eventually integrated with a broader effort which includes epidemiology and other state health information. No objection to amendment no. 2 having been raised, it was ADOPTED. Senator Rieger then MOVED for adoption of the letter of intent. No objection having been raised, IT WAS SO ORDERED. Co-chair Pearce then queried members regarding disposition of CSSS SB 71 (Finance). Senator Kerttula MOVED that CSSS SB 71 (Finance) pass from committee with individual recommendations and the zero SFC fiscal note. No objection having been raised, CSSS SB 71 (Finance) was REPORTED OUT of committee with a unanimous "do pass" recommendation, accompanied by the SFC letter of intent, a zero fiscal note from the Dept. of Commerce and Economic Development, and a zero SFC fiscal note for the Dept. of Health and Social Services. SENATE BILL NO. 84 An Act relating to fees for identification cards and certain motor vehicle licenses and permits; to licenses issued to drivers and to revocation of a license to drive; and providing for an effective date. Co-chair Pearce directed that SB 84 be brought on for discussion and directed attention to a new SFC fiscal note for the Dept. of Public Safety. She further explained that figures on the note were developed by Senator Kelly and his staff. JOSH FINK, aide to Senator Kelly, came before committee. He pointed to information from the Dept. of Public Safety indicating that it collects approximately 1,500 fake identification cards a year. It thus based its fiscal note on 1,500 annual license revocations. That number appears high in light of the deterrent effect of SB 84. Mr. Fink estimated that 500 revocations was a more reasonable number. The new SFC fiscal note is based on that amount, and the three requested positions were reduced to one--a hearing officer. Funding for contractual, supplies, and equipment remains as requested by the department. Total operating costs set forth on the note have been reduced from the department request of $215.7 to $146.7. Senator Kelly voiced his belief that news of the possible loss of driving privileges for use of false identification would quickly travel through underage Alaskans. The legislation is thus expected to serve as an effective deterrent. Senator Kelly advised that staff also researched the possibility of forfeiture of an individual's permanent fund dividend as well as driving privileges for use of false identification. It was determined, however, that that process would have to be undertaken through the court system, and substantial costs were involved. Co-chair Pearce voiced support for the legislation and queried members concerning disposition of the bill. Senator Kelly MOVED that SB 84 pass from committee with individual recommendations and the new SFC fiscal note. No objection having been raised, SB 84 was REPORTED OUT of committee with the $146.7 SFC fiscal note for the Dept. of Public Safety. All members signed the committee report with a "do pass" recommendation with the exception of Senator Rieger who signed "no rec." SENATE BILL NO. 154 An Act relating to the economic development grant program; and providing for an effective date. Co-chair Pearce directed that SB 154 be brought on for discussion, further directed attention to the Senate Labor and Commerce version, and noted need for a new fiscal note from the Dept of Commerce and Economic Development pertaining to that version. Senator Jacko, sponsor of the legislation, explained that the bill would establish an economic development grant program within the Dept. of Administration to fund municipal projects based on economic development criteria. The Senate Labor and Commerce version creates specific criteria municipalities and regional development organizations (ARDORS) must meet to obtain grants appropriated by the legislature. Eligibility will be determined by an evaluation committee headed by the Office of Management and Budget. The committee will work with the departments of Commerce and Economic Development, Community and Regional Affairs, and other agencies to prioritize applications. Applications must be submitted to the Governor by October 1. After ranking by the evaluation committee, the recommended projects will be submitted to legislative finance committees which will in turn recommend to the respective bodies which projects should be funded. Grant funding may only be used for construction of capital projects to increase economic opportunities for municipalities. Changes to the original bill, effected in Senate Labor and Commerce Committee, replaced the Dept. of Commerce and Economic Development with the Dept. of Administration as the administering agency. An additional change created the evaluation committee to ensure multi-departmental review. Senator Jacko next pointed to page 2, lines 7 through 20, of the bill and noted the six items of criteria to be use in evaluating projects. He then noted that CSSB 154 (L&C) is not intended as a replacement or substitute for "other capital funding programs" elsewhere within the legislative process. It is intended as a separate program whereby municipalities and their instrumentalities may access grant funds based solely on economic criteria. Co-chair Pearce referred to discussion in Senate Labor and Commerce Committee regarding inclusion of language allowing instrumentalities of municipalities to submit projects and receive funding. The Co-chair said that she had port authorities in mind during that discussion. She then asked if the Senate Labor and Commerce version would allow for that type of participation. Senator Jacko answered affirmatively. He added that two entities could apply for the grants: 1. ARDORS 2. Municipalities and their instrumentalities. Co-chair Pearce voiced her understanding that port authority legislation requires that port authorities be instrumentalities of municipalities. Senator Kerttula questioned transfer of administrative authority from the Dept. of Commerce and Economic Development to the Dept. of Administration. He noted that duties of the Dept. of Administration originally related to bookkeeping functions. Responsibility for pioneer, telecommunication, and other programs have been added over time. The department has thus become an advocating agency when it should remain neutral and focus on bookkeeping. He then asked why the change was made to Administration rather than Community and Regional Affairs. Senator Jacko noted that all three departments would be involved in the effort. The question is not one of advocacy so much as evaluation of criteria and the subsequent making of recommendations based on that criteria. SHELBY STASTNY, Director, Office of Management and Budget, came before committee. He voiced the administration's position that since the Dept. of Administration has already established the mechanism to administer a number of other grant programs, it was logical to place this economic development grant program under its jurisdiction as well. Senator Kelly asked if the administration supports the bill in its current form. Mr. Stastny responded affirmatively. Senator Kelly observed that changes effected in CSSB 154 (L&C) were made at the request of the administration and in conjunction with the prime sponsor. Mr. Stastny attested to the fact that the proposed bill represents "an important part of the capital structure." He then voiced disappointment that legislation containing the capital matching grants program, an integral part of the whole capital structure, was not also being heard at this time. Senator Kelly suggested that under CSSB 154 (L&C), the administration would have much latitude for capital funding. Mr. Stastny observed that neither the bill nor any other mechanism address several areas that would be covered by capital matching grants. He stressed need for an equitable dispersion of "at least some portion of the capital budget throughout all the communities and villages of Alaska." That would be difficult to accomplish under CSSB 154 (L&C). CHRIS GATES, Director, Division of Economic Development, Dept. of Commerce and Economic Development, next came before committee. He voiced his understanding that the program would be administered within available resources at the Dept. of Administration. JIM KOHLER, Executive Director, Southeast Conference, next came before committee, voicing support for the bill and appreciation to legislators who devoted time to the economic task force summit. He noted that the proposed bill reflects one of the issue brought forth at the summit. Action repeats the signal that the legislature is both conscious and desirous of specific, immediate action that will result in direct economic impact. Co-chair Pearce directed that the bill be HELD in committee pending receipt of a new fiscal note from the Dept. of Administration. SENATE BILL NO. 82 An Act relating to the Dalton Highway. Co-chair Pearce directed that SB 82 be brought on for discussion and referenced a draft, handwritten SFC fiscal note for the Dept. of Public Safety, which she explained was in the process of being typed in final form. Co-chair Frank said that the draft SFC note reduces the department note from $786.7 to $99.0. He explained that over the six years he has worked on opening the Dalton, the only concern that appears to have legitimacy relates to possible pressure upon fish and game resources. While the Dept. of Fish and Game has not expressed concern, the Dept. of Public Safety has requested additional fish and wildlife protection officers to monitor the highway. The department requested two full- time blue shirts, a full-time brown shirt and a seasonal brown shirt. The SFC note funds three seasonal brown shirts to address additional impact on fish and game resources. Most of the hunting and fishing pressure will occur during the summer and fall. Senator Kerttula voiced his belief that opening of the road would cost more than funding set forth on the draft note. He further commented on enforcement needs along the Copper River Highway should it open. SENATOR LINCOLN next came before committee. She referenced questions raised when the bill was before Senate Transportation and acknowledged receipt of a memo in response from Senator Frank. She then urged members to carefully consider the overall impact of opening the Dalton. Senator Lincoln suggested that not all departments have been open in terms of what the ultimate cost will be. Senator Lincoln referenced an environmental assessment, before the Tanana Chiefs Conference, dealing with environmental impact from mile 0 to 56 and noted that it was not part of committee documentation on SB 82. The assessment notes significant impact on fisheries and fur- bearing habitat as a result of tourism in the area. The Senator suggested that members consider the road as a whole rather than merely a portion of it when calculating costs. She further commented on debris along the highway (tires, broken pieces of trailers, broken-down vehicles, and ordinary trash). Senator Lincoln further questioned liability associated with the opening of additional portions of the haul road, noting specifically a lack of pullouts and white-out conditions occasioned by dust and flying rocks. She stressed that the Dalton is a commercial rather than a tourist highway. Tourism will merely be a byproduct. Senator Lincoln next directed attention to Resolution 93-129 from the Tanana Chiefs Conference and read the following: BE IT FURTHER RESOLVED, that the Tanana Chiefs Conference opposes the opening of the haul road by either the Alaska Legislature or Governor Hickel unless a negotiated settlement is reached with the state and the villages. The foregoing provides an opening for the state to sit down with villages and discuss concerns. The Senator further pointed to ongoing litigation between the Tanana Chiefs and the state. Oral arguments are to commence this summer. Many questions surrounding opening of the road have not yet been answered. In her closing remarks, Senator Lincoln raised questions concerning the potential financial burden opening of the road might place upon the state. In response to a question from Senator Jacko, Senator Lincoln attested to concern relating to impact upon villages along the haul road corridor, fish and game, fire protection, subsistence use, etc. Senator Frank noted that the proposed agreement by TCC is, according to the Dept. of Law, unacceptable. End, SFC-93, #43, Side 1 Begin, SFC-93, #43, Side 2 Co-chair Frank reiterated that impact upon of fish and game resources is a legitimate concern. He then voiced his belief the impact would not be significant, but he agreed that additional fish and wildlife officers and funding for Dept. of Fish and Game monitoring represent reasonable approaches. The Senator again stressed that the general public should have the right to drive a state-owned highway. There is no overriding or compelling reason for the last portion of the road to remain closed when other parts of the highway have been incrementally opened over the years with no "bad experience." The fact that the road is open at least half way has not resulted in significantly detrimental impact. Senator Kelly asked if passage of the proposed bill would eliminate existing litigation. Co-chair Frank responded affirmatively, voicing his understanding that the legal issue relates to whether or not the Governor has authority to open the road. Senator Frank next referred to past intent language suggesting that the Dept. of Transportation work with oil industry lease-holders to provide access "all the way to the Arctic Ocean in a way that met their security needs . . . ." Co-chair Pearce advised of an existing commercial tourism business in Deadhorse. The visitor center owned by ARCO received over 6,000 visitors last year. Two enterprises (one operated by NANA Regional Corporation and one by a private contractor in Fairbanks) provide a commercial tour by minivan from Deadhorse to oil industry facilities and the Arctic Ocean. Senator Lincoln reiterated that both the Tanana Chiefs and North Slope Borough remain opposed to the opening. She next directed attention to February 26, 1993, correspondence (copy on file in the permanent Senate Finance file for SB 82) from Ron Somerville, Deputy Commissioner, Dept. of Fish and Game, and noted the following: Opening this portion of the Dalton Highway to the public will increase use of the Dalton Highway Corridor and areas accessible from the road by non-local residents and nonresidents for hunting, fishing, and possibly trapping. . . . Increasing public use will require or encourage development of new and expansion of existing facilities to serve highway travelers. There is thus no question that once the road is open, increased impact will occur. Co-chair Pearce responded that although a portion of the road is now closed, lack of enforcement of that closure has essentially resulted in a completely open road for which the state is unable to utilize federal highway moneys. Only official opening of the road through statute will allow use of federal highway dollars for maintenance of a primary artery for state revenues. She suggested that the state may actually be more liable now than it will be once the road is completely opened. Senator Lincoln countered by advising that the road does not now experience the traffic flow it will once the public knows that the entire road is open. The current public perception is that it is not an open road. Comments followed by Senator Frank regarding the number of recreational vehicles visiting the state as a whole and Fairbanks in particular. He suggested of the 14,500 each year, approximately 80% visit Fairbanks and perhaps 10% to 20% would travel the haul road. The average stay of highway travelers is 14 days. A trip up the Dalton and back would add another 4 days. Co-chair Frank acknowledged that there would be traffic impact, advising: I wouldn't be trying to get it opened if I didn't think there'd be some positive tourism impact. I don't think it will be significant. I don't think it will be 14,000. That's for sure. I think it'll be more like 1,400, maybe, additional. In response to a question from Senator Kerttula, Senator Frank noted that hunting and fishing, with the exception of bow and arrow, are prohibited within a five-mile corridor along each side of the road. That is a protection this road enjoys that other state roads do not. Senator Lincoln said that she frequently drives the road. She stressed that it is extremely dangerous. Rampart has had very few legal moose "because it looks like the New York Freeway when moose season opens." Resources in the area are significantly impacted. She referenced the previously mentioned environmental assessment and noted a proposed re- routing of the highway to lessen the impact. That would be costly. In her closing remarks, Senator Lincoln expressed appreciation to Co-chair Frank and his staff for working with her office on the issue. Co-chair Pearce called for additional testimony on SB 82. None was forthcoming. She then referenced the Senate Transportation Committee version of the bill as well as fiscal notes from the Dept. of Fish and Game, SFC note for the Dept. of Public Safety, and zero notes from the Dept. of Natural Resources and the Dept. of Transportation and Public Facilities. Senator Kelly voiced understanding that the letter of intent earlier mentioned by Co-chair Frank would be offered on the Floor of the Senate. Co-chair Frank concurred. Senator Kerttula voiced concern that the bill would ultimately cost much more than fiscal notes indicate. Co- chair Frank questioned the credibility of the original Dept. of Public Safety note. Co-chair Pearce suggested that pressure on fish and game resources along the highway comes from Alaskans rather than tourists. The SFC fiscal note acknowledges that in provision of the three seasonal positions. Senator Kelly said he had not supported opening the road in the past. The proposal is more palatable at this time in light of new ISTEA funding which would replace state general funds with federal dollars. Senator Sharp voiced his belief that Co-chair Frank has responsibly addressed potential impact and the need for additional brown shirts to cover high-pressure hunting and fishing seasons. Co-chair Frank MOVED that CSSB 82 (TRA) pass from committee with accompanying fiscal notes from DOTPF, DNR, DF&G, and the SFC note for the Dept. of Public Safety. Senator Rieger inquired concerning the amount of the Dept. of Fish and Game note. Co-chair Frank explained that the requested $16.1 would provide a seasonal fish and wildlife technician III for three months to monitor hunting activities along the road. No objection to passage having been raised, CSSB 82 (TRA) was REPORTED OUT of committee with zero fiscal notes from the Dept. of Natural Resources and the Dept. of Transportation and Public Facilities, a $16.1 note from the Dept. of Fish and Game, and a $99.0 SFC note for the Dept. of Public Safety. Co-chairs Frank and Pearce and Senators Jacko and Sharp signed the committee report with a "do pass" recommendation. Senators Kelly, Kerttula, and Rieger signed "no rec." ANNOUNCEMENT Co-chair Pearce announced that the committee would meet at 9:00 a.m. March 23, 1993, to discuss a committee substitute for supplemental funding (SB 100) as well as SB 112 and SB 149, relating respectively to universal commercial code and banking code revisions. ADJOURNMENT The meeting was adjourned at approximately 10:40 a.m.