Legislature(2013 - 2014)BELTZ 105 (TSBldg)

02/18/2014 01:30 PM LABOR & COMMERCE


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 159 AIR AMBULANCE SERVICES TELECONFERENCED
Heard & Held
*+ SB 99 AIDEA: DEVELOPMENT LOANS TELECONFERENCED
Heard & Held
*+ SB 140 AIDEA: ARCTIC DEVELOPMENT PROGRAM/FUND TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
          SENATE LABOR AND COMMERCE STANDING COMMITTEE                                                                        
                       February 18, 2014                                                                                        
                           1:33 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Mike Dunleavy, Chair                                                                                                    
Senator Peter Micciche, Vice Chair                                                                                              
Senator Donald Olson                                                                                                            
Senator Bert Stedman                                                                                                            
Senator Johnny Ellis                                                                                                            
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
SENATE BILL NO. 159                                                                                                             
"An  Act  relating  to  air   ambulance  service  providers,  air                                                               
ambulance membership agreements, and  regulation of air ambulance                                                               
service providers and air ambulance  membership agreements by the                                                               
division of insurance; and providing for an effective date."                                                                    
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
SENATE BILL NO. 99                                                                                                              
"An  Act   correcting  a  reference  to   the  Alaska  Industrial                                                               
Development  and Export  Authority revolving  fund; limiting  the                                                               
use  of the  Alaska Industrial  Development and  Export Authority                                                               
sustainable energy  transmission and supply development  fund for                                                               
certain loans  and loan guarantees  and allowing  the development                                                               
fund to  be used as security  for a bond guarantee;  and amending                                                               
the definition of 'qualified energy development.'"                                                                              
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
SENATE BILL NO. 140                                                                                                             
"An Act  creating the  Arctic infrastructure  development program                                                               
and  fund  in  the  Alaska   Industrial  Development  and  Export                                                               
Authority."                                                                                                                     
                                                                                                                                
     - HEARD & HELD                                                                                                             
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: SB 159                                                                                                                  
SHORT TITLE: AIR AMBULANCE SERVICES                                                                                             
SPONSOR(s): SENATOR(s) STEDMAN                                                                                                  
                                                                                                                                
02/05/14       (S)       READ THE FIRST TIME - REFERRALS                                                                        
02/05/14       (S)       L&C                                                                                                    
02/18/14       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: SB  99                                                                                                                  
SHORT TITLE: AIDEA: DEVELOPMENT LOANS                                                                                           
SPONSOR(s): SENATOR(s) MCGUIRE                                                                                                  
                                                                                                                                
04/05/13       (S)       READ THE FIRST TIME - REFERRALS                                                                        
04/05/13       (S)       L&C                                                                                                    
02/18/14       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
BILL: SB 140                                                                                                                  
SHORT TITLE: AIDEA: ARCTIC DEVELOPMENT PROGRAM/FUND                                                                             
SPONSOR(s): SENATOR(s) MCGUIRE                                                                                                  
                                                                                                                                
01/27/14       (S)       READ THE FIRST TIME - REFERRALS                                                                        
01/27/14       (S)       L&C, FIN                                                                                               
02/18/14       (S)       L&C AT 1:30 PM BELTZ 105 (TSBldg)                                                                      
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
CHRISTIE JAMIESON, Staff                                                                                                        
Senator Bert Stedman                                                                                                            
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Introduced SB 159 on behalf of the sponsor.                                                               
                                                                                                                                
MARTY HESTER, Acting Director                                                                                                   
Division of Insurance                                                                                                           
Department of Commerce, Community and Economic Development                                                                      
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Answered questions and provided information                                                               
related to SB 159.                                                                                                              
                                                                                                                                
SHELLY DEERING, Regional Manager                                                                                                
Airlift Northwest                                                                                                               
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of SB 159.                                                                           
                                                                                                                                
CHRIS MARTIN, Executive Director                                                                                                
Airlift Northwest                                                                                                               
University of Washington                                                                                                        
Seattle, Washington                                                                                                             
POSITION STATEMENT: Testified in support of SB 159.                                                                           
                                                                                                                                
JESSE LOGAN, Staff                                                                                                              
Senator Lesil McGuire                                                                                                           
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Introduced SB 99 and SB 140 on behalf of the                                                              
sponsor.                                                                                                                        
                                                                                                                                
MARK DAVIS, Deputy Director                                                                                                     
Alaska Industrial Development and Export Authority (AIDEA)                                                                      
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Provided supporting testimony on SB 99.                                                                   
                                                                                                                                
SENATOR LESIL MCGUIRE                                                                                                           
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Sponsor of SB 99 and SB 140.                                                                              
                                                                                                                                
KEN COLLISON, Chief Operating Officer                                                                                           
Ucore Rare Metals                                                                                                               
POSITION STATEMENT: Provided supporting testimony on SB 99.                                                                   
                                                                                                                                
STEPHEN TRIMBLE, President                                                                                                      
Trimble Strategies, LLC                                                                                                         
POSITION STATEMENT: Stated support for SB 140.                                                                                
                                                                                                                                
STEPHEN KLINE, Managing Principle                                                                                               
First Infrastructure Inc.                                                                                                       
POSITION STATEMENT: Provided supporting testimony on SB 140.                                                                  
                                                                                                                                
CHRIS HLADICK, Manager                                                                                                          
City of Unalaska                                                                                                                
Unalaska, Alaska                                                                                                                
POSITION STATEMENT: Testified in support of SB 140.                                                                           
                                                                                                                                
RON LONG, Assistant City Manager                                                                                                
City of Seward                                                                                                                  
Seward, Alaska                                                                                                                  
POSITION STATEMENT: Testified in support of SB 140.                                                                           
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:33:12 PM                                                                                                                    
CHAIR MIKE DUNLEAVY called the Senate Labor and Commerce                                                                      
Standing Committee meeting to order at 1:33 p.m. Present at the                                                                 
call to order  were Senators Stedman, Micciche,  Olson, and Chair                                                               
Dunleavy. Senator Ellis arrived soon thereafter.                                                                                
                                                                                                                                
                 SB 159-AIR AMBULANCE SERVICES                                                                              
                                                                                                                                
1:33:36 PM                                                                                                                    
CO-CHAIR DUNLEAVY announced  the consideration of SB 159."An Act                                                               
relating  to  air  ambulance  service  providers,  air  ambulance                                                               
membership agreements,  and regulation  of air  ambulance service                                                               
providers  and   air  ambulance  membership  agreements   by  the                                                               
division of insurance; and providing for an effective date."                                                                    
                                                                                                                                
1:33:55 PM                                                                                                                    
CHRISTIE  JAMIESON, Staff,  Senator Bert  Stedman, sponsor  of SB                                                               
159, introduced the  bill on behalf of the sponsor.  She read the                                                               
following   sponsor   statement   into  the   record:   [Original                                                               
punctuation provided.]                                                                                                          
                                                                                                                                
     Since  January  2009,  Airlift Northwest,  the  Seattle                                                                    
     based  provider  of  lifesaving air  medical  transport                                                                    
     services,  has offered  the popular  AirCare membership                                                                    
     program to  residents of  Southeast Alaska.  Over 1,600                                                                    
     Southeast households  are enrolled in the  program. Air                                                                    
     medical transportation  is expensive and  insurance may                                                                    
     not cover  all the  costs. The  purpose of  the AirCare                                                                    
     program is to cover  all out-of-pocket expenses such as                                                                    
     deductibles  and coinsurance  amounts that  may not  be                                                                    
     covered  by the  primary payer.  As an  AirCare member,                                                                    
     only your  insurance company  receives a  bill. Airlift                                                                    
     Northwest  is   secondary  to  all  payers   and  works                                                                    
     directly  with   your  insurance  company   for  claims                                                                    
     processing.  The AirCare  program  directly helps  fund                                                                    
     Airlift Northwest so they  can transport critically ill                                                                    
     or injured  patients to hospitals  with levels  of care                                                                    
     not locally available.                                                                                                     
     Since its  inception, the  AirCare program  was offered                                                                    
     to Alaskans  under a  regulatory exemption  it received                                                                    
     from the  Alaska Division of Insurance.  However, after                                                                    
     an  organizational   restructuring,  the   Division  of                                                                    
     Insurance  deemed the  program  no  longer exempt  from                                                                    
     insurance regulation  as stated  in AS  21.87.010 under                                                                    
     which Airlift  Northwest was providing the  program. As                                                                    
     a  result, the  Division of  Insurance ordered  Airlift                                                                    
     Northwest  to  cease  enrolling  new  members.  Airlift                                                                    
     Northwest   is   allowed   to  honor   their   existing                                                                    
     memberships  but  is  not   allowed  to  renew  expired                                                                    
     memberships.                                                                                                               
     If  Airlift Northwest  wants to  continue offering  the                                                                    
     AirCare program, then the program  must either be fully                                                                    
     insured  by a  health insurer  authorized by  Alaska or                                                                    
     Airlift   Northwest  must   obtain  a   certificate  of                                                                    
     authority  pursuant  to  AS 21.09  to  transact  health                                                                    
     insurance in  Alaska. Since Airlift  Northwest operates                                                                    
     under  the  umbrella   of  University  of  Washington's                                                                    
     medical system,  becoming a licensed insurer  in Alaska                                                                    
     is not an option for them.                                                                                                 
     Senate  Bill 159  will  exempt  air ambulance  services                                                                    
     from  the  state's  insurance  code,  thereby  allowing                                                                    
     Airlift  Northwest  to  continue offering  the  AirCare                                                                    
     program to Alaskans.                                                                                                       
                                                                                                                                
1:37:33 PM                                                                                                                    
SENATOR  OLSON  asked  the  reason  for  the  restructuring  that                                                               
eliminated the regulatory exemption.                                                                                            
                                                                                                                                
SENATOR STEDMAN  suggested the Division  of Insurance  answer the                                                               
question.                                                                                                                       
                                                                                                                                
SENATOR  OLSON asked  what other  medevac services  in the  state                                                               
would be affected by this legislation.                                                                                          
                                                                                                                                
MS.  JAMIESON offered  her understanding  that  Apollo [MT]  from                                                               
Fairbanks  would also  be  affected and  they  haven't voiced  an                                                               
opinion on the legislation.                                                                                                     
                                                                                                                                
SENATOR OLSON asked  if Apollo MT is owned by  an Alaskan company                                                               
or an outside entity.                                                                                                           
                                                                                                                                
MS. JAMIESON said she didn't know.                                                                                              
                                                                                                                                
SENATOR  OLSON  asked  if  Airlift  Northwest  and  Guardian  are                                                               
ineligible  to  receive  a certificate  of  insurance  in  Alaska                                                               
because they're owned by outside entities.                                                                                      
                                                                                                                                
MS. JAMIESON said she didn't know.                                                                                              
                                                                                                                                
l1:39:19 PM                                                                                                                   
SENATOR ELLIS joined the committee.                                                                                             
                                                                                                                                
SENATOR OLSON                                                                                                                   
                                                                                                                                
MARTY HESTER, Acting Director,  Division of Insurance, introduced                                                               
himself.                                                                                                                        
                                                                                                                                
SENATOR  OLSON  asked why  the  division  undertook a  regulatory                                                               
change that eliminated the exemption.                                                                                           
                                                                                                                                
MARTY HESTER clarified  that it wasn't the  division that changed                                                               
regulations. The division was approached  by another company that                                                               
wanted to  offer similar membership agreements  and operate under                                                               
the  same exemption  as Airlift  Northwest.  The division  deemed                                                               
that the new  company did not meet the Title  21 exemption. After                                                               
inquiry,  the  division   subsequently  determined  that  Airlift                                                               
Northwest no longer qualified for  the exemption that was offered                                                               
in 2008,  because in  2010 the company  restructured to  become a                                                               
nonprofit under the University of Washington.                                                                                   
                                                                                                                                
Airlift Northwest  is considered a municipality  under Washington                                                               
statute  and they  petitioned  the Division  of  Insurance to  be                                                               
considered  a municipality  under Alaska  statute or  a nonprofit                                                               
medical   service   corporation   under   AS   21.87.010.   After                                                               
discussions  with Department  of  Law, the  division deemed  that                                                               
Airlift  Northwest  neither  qualified as  a  municipality  under                                                               
Alaska  statute nor  as a  nonprofit medical  service corporation                                                               
because they weren't offering a  medical service. The company was                                                               
in   fact  offering   a  benefit   by  waiving   deductibles  and                                                               
coinsurance of  members that purchased the  agreements. Thus, the                                                               
Division of  Insurance contacted Airlift Northwest  and asked the                                                               
company to cease and desist.                                                                                                    
                                                                                                                                
SENATOR  OLSON  commented that  it  sounds  as  though it  was  a                                                               
reinterpretation of AS 21.87.010.                                                                                               
                                                                                                                                
MR. HESTER clarified that Airlift  Northwest changed structure in                                                               
2010 to  become a nonprofit  under the University  of Washington.                                                               
Responding  to  further  questions,   he  restated  the  forgoing                                                               
explanation.                                                                                                                    
                                                                                                                                
SENATOR OLSON asked if Airlift  Northwest aircraft are designated                                                               
as  public  use  aircraft  since  they're  a  municipality  under                                                               
Washington statute.                                                                                                             
                                                                                                                                
MR. HESTER said he wasn't sure.                                                                                                 
                                                                                                                                
1:45:01 PM                                                                                                                    
SENATOR  OLSON offered  his view  that anybody  who flies  a sick                                                               
person to get medical care is  offering a service. He opined that                                                               
the division  did the  people of Alaska  a disservice  by issuing                                                               
the cease  and desist order. He  asked if it's true  that medevac                                                               
services are no longer available.                                                                                               
                                                                                                                                
MR. HESTER  clarified that the division's  determination was that                                                               
an  air ambulance  service provider  can't  offer the  membership                                                               
agreement.  They can  still  operate, but  they  can't offer  the                                                               
benefit to not balance bill the additional cost.                                                                                
                                                                                                                                
SENATOR OLSON reiterated that this  is working against the public                                                               
interest and putting some people in dire straits.                                                                               
                                                                                                                                
MR. HESTER  responded that part  of the mission statement  of the                                                               
Division of Insurance is to  protect the consumer. In conjunction                                                               
with Department of Law, the  division determined that the product                                                               
that  was being  offered by  Airlift Northwest  did not  meet the                                                               
required exemptions under AS 21.87.010.  He also pointed out that                                                               
a product was still available  to Alaskans when this decision was                                                               
made. The  division determined that  it was  protecting consumers                                                               
by applying the statute as it was written.                                                                                      
                                                                                                                                
SENATOR  OLSON  maintained that  from  a  medical standpoint  the                                                               
decision is working to the detriment of the patient.                                                                            
                                                                                                                                
1:48:28 PM                                                                                                                    
SENATOR STEDMAN  voiced concern that  the lack of  competition is                                                               
driving the price  structure of air ambulance  services. He asked                                                               
the  division's  opinion  about altering  the  statute  to  allow                                                               
further competition.                                                                                                            
                                                                                                                                
MR. HESTER  responded that  the division sees  that SB  159 would                                                               
provide consumer  protections and  allow additional  business for                                                               
products  that Alaskans  have  asked  for to  be  written in  the                                                               
state.                                                                                                                          
                                                                                                                                
SENATOR STEDMAN said he takes that  as a statement of support for                                                               
the bill.                                                                                                                       
                                                                                                                                
1:50:06 PM                                                                                                                    
MR. HESTER restated the division's  mission statement to regulate                                                               
the  insurance   industry  to   protect  Alaskan   consumers.  He                                                               
continued to say  that consumers need products in  Alaska and the                                                               
state needs to be open for  business to provide those products to                                                               
Alaskans.  SB 159  provides the  protections that  consumers need                                                               
and allows the products consumers are asking for, he said.                                                                      
                                                                                                                                
SENATOR STEDMAN disclosed  that he is a licensed  life and health                                                               
insurance agent.                                                                                                                
                                                                                                                                
1:51:14 PM                                                                                                                    
CO-CHAIR  DUNLEAVY asked  what happens  to a  member who  needs a                                                               
plane and one isn't available.                                                                                                  
                                                                                                                                
MR. HESTER said  the products that were sold in  the past did not                                                               
guarantee service  and any  sold in  the future  wouldn't either.                                                               
Companies may decide  to offer reciprocity but  he couldn't speak                                                               
to the specifics because he hadn't seen those products.                                                                         
                                                                                                                                
CHAIR DUNLEAVY observed that something  could be written into the                                                               
agreement.                                                                                                                      
                                                                                                                                
MR. HESTER agreed.                                                                                                              
                                                                                                                                
SENATOR MICCICHE referenced  Section 2 subsection (c)  on page 2,                                                               
lines 6-9,  and summarized that  a third party isn't  required to                                                               
provide air  ambulance service.  He asked  if state  law requires                                                               
somebody  who is  available  to respond  to a  person  who is  in                                                               
medical need.                                                                                                                   
                                                                                                                                
MR. HESTER offered to follow up with the answer.                                                                                
                                                                                                                                
SENATOR  MICCICHE  asked  if other  companies  currently  operate                                                               
under the existing exemption.                                                                                                   
                                                                                                                                
MR. HESTER answered no, but  one underwritten company is offering                                                               
the product and it is compliance with Title 21.                                                                                 
                                                                                                                                
1:54:08 PM                                                                                                                    
SHELLY  DEERING,  Regional  Manager, Airlift  Northwest,  Juneau,                                                               
Alaska, introduced herself.                                                                                                     
                                                                                                                                
CHRIS MARTIN,  Executive Director, Airlift  Northwest, University                                                               
of Washington, Seattle, Washington, introduced herself.                                                                         
                                                                                                                                
MS. DEERING  said she is testifying  in support of SB  159, which                                                               
seeks  to provide  Alaskans with  the ability  to participate  in                                                               
membership programs for air medical  transportation. She has been                                                               
the  regional manager  of Airlift  Northwest  ("Airlift") for  21                                                               
years,  and  the  company has  been  transporting  patients  from                                                               
Southeast and other  regions of Alaska for 32 years.  She and the                                                               
staff of 19 nurses and pilots  live in Juneau. She explained that                                                               
Airlift  sold  air care  membership  in  Alaska from  2008  until                                                               
November 2013  when the Division  of Insurance asked  the company                                                               
to  stop  due  to  a  restructure of  Airlift  Northwest  and  an                                                               
interpretation of  the regulations.  Airlift currently  has 4,066                                                               
members in the program that reside in Southeast.                                                                                
                                                                                                                                
She  said  the  Division  of Insurance  has  been  supportive  of                                                               
getting legislation  that would allow  Airlift and any  other air                                                               
ambulance company  to sell memberships  to Alaskans. SB  159 does                                                               
this  and  also gives  important  oversight  to the  Division  of                                                               
Insurance.                                                                                                                      
                                                                                                                                
SENATOR MICCICHE observed that Section  1 appears to clarify that                                                               
an air  ambulance service  provider would have  to respond  if it                                                               
was available  when there was  a medical emergency, even  if that                                                               
company didn't have  an agreement. He asked  if his understanding                                                               
was correct.                                                                                                                    
                                                                                                                                
MS.  DEERING  stated  that  Airlift  Northwest  responds  to  any                                                               
emergent  request it  receives. The  question of  insurance isn't                                                               
raised.                                                                                                                         
                                                                                                                                
SENATOR  MICCICHE asked  if she  agrees that  Section 1  requires                                                               
that.                                                                                                                           
                                                                                                                                
MS.  MARTIN agreed  and also  confirmed  Ms. Deering's  statement                                                               
that Airlift responds  to any request for  emergent transport. It                                                               
doesn't matter  whether the person  has an AirCare  membership or                                                               
insurance. She noted  that last year Airlift did  over $7 million                                                               
in charity care.                                                                                                                
                                                                                                                                
SENATOR MICCICHE read Section 1.                                                                                                
                                                                                                                                
1:59:23 PM                                                                                                                    
SENATOR STEDMAN disclosed that he may be an AirCare member.                                                                     
                                                                                                                                
SENATOR  OLSON asked  how Airlift  Northwest is  able to  stay in                                                               
business in light of the ruling in Alaska.                                                                                      
                                                                                                                                
MS. MARTIN  said the company  has four bases in  Washington state                                                               
in  addition to  the  base  in Southeast  Alaska,  but the  issue                                                               
really isn't financial. It's the right thing to do for patients.                                                                
                                                                                                                                
2:01:49 PM                                                                                                                    
CHAIR  DUNLEAVY  opened  public  testimony.  He  found  none.  He                                                               
commented  that  without  air ambulance  service,  his  wife  and                                                               
youngest child  wouldn't have survived. He  described the service                                                               
as crucial to all Alaskans, particularly those in rural regions.                                                                
                                                                                                                                
CHAIR DUNLEAVY announced he would hold SB 159 in committee.                                                                     
                                                                                                                                
2:02:52 PM                                                                                                                    
At ease.                                                                                                                        
                                                                                                                                
                SB  99-AIDEA: DEVELOPMENT LOANS                                                                             
                                                                                                                                
2:03:39 PM                                                                                                                    
CO-CHAIR DUNLEAVY  announced the consideration of  SB 99."An Act                                                               
correcting a  reference to the Alaska  Industrial Development and                                                               
Export Authority revolving  fund; limiting the use  of the Alaska                                                               
Industrial  Development and  Export Authority  sustainable energy                                                               
transmission and  supply development  fund for certain  loans and                                                               
loan guarantees and  allowing the development fund to  be used as                                                               
security for  a bond  guarantee; and  amending the  definition of                                                               
'qualified energy development.'" This was the first hearing.                                                                    
                                                                                                                                
2:03:58 PM                                                                                                                    
JESSE LOGAN,  Staff, Senator Lesil  McGuire, introduced SB  99 on                                                               
behalf  of  the  sponsor.  He  spoke  to  the  following  sponsor                                                               
statement: [Original punctuation provided.]                                                                                     
                                                                                                                                
     The Sustainable  Energy Transmission and  Supply (SETS)                                                                    
     Development  Fund was  created in  2012, AS  44.88.650-                                                                    
     44.88.690,  as  a  fund within  the  Alaska  Industrial                                                                    
     Development  and Export  Authority  (AIDEA) to  promote                                                                    
     and  provide financing  for energy  development in  the                                                                    
     state to  alleviate unemployment and contribute  to the                                                                    
     state's  economic  welfare,   economic  diversity,  and                                                                    
     economic  development.  Under  this  statute  AIDEA  is                                                                    
     authorized to use  money in the SETS fund  to assist in                                                                    
     the  construction,   improvement,  rehabilitation,  and                                                                    
     expansion of qualified energy developments.                                                                                
                                                                                                                                
     SB  99  provides  technical   amendments  to  the  SETS                                                                    
     Development Fund  within AIDEA. It has  been determined                                                                    
     that  the statutes,  as written  last year,  created an                                                                    
     ambiguity in  the one  third capital  cost limit  as it                                                                    
     relates to loans, loan  guarantees and bond guarantees.                                                                    
     The  ambiguity arises  in the  current  statutes as  to                                                                    
     whether  the  $20  million loan  limitation  worked  in                                                                    
     conjunction   as  a   one-third   limitation  on   loan                                                                    
     guarantees,  or  was  independent of  that  limitation.                                                                    
     Additionally, the  statute was  vague as it  relates to                                                                    
     AIDEA's authority to  use the fund as a  security for a                                                                    
         bond guarantee. These amendments clarify these                                                                         
     ambiguities.                                                                                                               
                                                                                                                                
     AIDEA  has received  requests  from project  components                                                                    
     and banks  to utilize  the fund  in which  AIDEA needed                                                                    
     the authority to  issue a bond guarantee  for more than                                                                    
     one-third  of project  costs. This  bill clarifies  the                                                                    
     types of  financing and  limitations for  financing for                                                                    
     qualified energy developments in the state.                                                                                
                                                                                                                                
2:07:14 PM                                                                                                                    
MR. LOGAN reviewed the proposed changes to the existing statute.                                                                
   · On page 2, line 3, the word "loan" was deleted to reflect                                                                  
     the correct name of the revolving fund.                                                                                    
   · Page 2, lines 15-17, contains additional language that                                                                     
     specifies  that  this  section  only  applies  to  the  SETS                                                               
     program and not any other within AIDEA.                                                                                    
   · On page 2, line 17, the words "finance or participate in                                                                   
     financing  of" was  deleted to  clarify that  paragraphs (1)                                                               
     and (2)  of AS  44.88.690(a) found on  page 2,  lines 18-21,                                                               
     pertain only to  loans and loan guarantees,  and not general                                                               
     finance  participation.  The   provision  in  paragraph  (1)                                                               
     specifies that AIDEA cannot grant  a loan for more than one-                                                               
     third  of  the  cost   of  a  qualified  energy  development                                                               
     project. The  language in paragraph  (2) clarifies  that the                                                               
     loan guarantee cannot exceed $20,000.                                                                                      
   · On page 2, line 28, the term "project" was changed to                                                                      
     "development"    to   clarify    that   "qualified    energy                                                               
     development" means  a development in the  state, rather than                                                               
     a project.                                                                                                                 
   · Section 3 on page 2 specifies that the program can be used                                                                 
     for a security of a bond guarantee.                                                                                        
                                                                                                                                
2:09:40 PM                                                                                                                    
MARK DAVIS,  Deputy Director,  Alaska Industrial  Development and                                                               
Export  Authority, (AIDEA),  stated  agreement  with Mr.  Logan's                                                               
description of  SB 99. He  added that  the bill was  requested by                                                               
the financial institutions that AIDEA works with.                                                                               
                                                                                                                                
2:10:33 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
2:12:02 PM                                                                                                                    
CHAIR DUNLEAVY reconvened the meeting and asked Senator Stedman                                                                 
if he had an amendment to offer.                                                                                                
                                                                                                                                
2:12:14 PM                                                                                                                    
SENATOR STEDMAN moved Amendment 1, labeled 28-LS0741\A.3.                                                                       
                                                                                                                                
CHAIR DUNLEAVY objected for discussion purposes.                                                                                
                                                                                                                                
                          AMENDMENT 1                                                                                       
                                                                                                                                
                                                                                                                                
    OFFERED IN THE SENATE                    BY SENATOR STEDMAN                                                                 
          TO:  SB 99                                                                                                            
                                                                                                                                
     Page 1, line 5, following "guarantee;":                                                                                  
          Delete "and"                                                                                                        
                                                                                                                                
     Page 1, line 6:                                                                                                            
          Delete "development.'"                                                                                              
          Insert "development'; and authorizing the Alaska                                                                    
     Industrial  Development and  Export Authority  to issue                                                                  
     bonds  to finance  the infrastructure  and construction                                                                  
     costs  of the  Bokan-Dotson  Ridge  rare earth  element                                                                  
     project."                                                                                                                
                                                                                                                                
     Page 3, following line 4:                                                                                                  
          Insert a new bill section to read:                                                                                    
        "*  Sec.  5. The  uncodified  law  of the  State  of                                                                
     Alaska is amended by adding a new section to read:                                                                         
          LEGISLATIVE APPROVAL; BOKAN-DOTSON RIDGE RARE                                                                         
     EARTH  ELEMENT  PROJECT.   (a)  The  Alaska  Industrial                                                                    
     Development  and Export  Authority may  issue bonds  to                                                                    
     finance  the infrastructure  and construction  costs of                                                                    
     the Bokan-Dotson Ridge rare  earth element project. The                                                                    
     Bokan-Dotson Ridge rare earth  element project shall be                                                                    
     owned by the authority  and financed under AS 44.88.172                                                                    
     -  44.88.177.   The  principal  amount  of   the  bonds                                                                    
     provided by  the authority  for the  Bokan-Dotson Ridge                                                                    
     rare earth element project  may not exceed $145,000,000                                                                    
     and may  include the costs of  issuing bonds considered                                                                    
     reasonable  and appropriate  by  the Alaska  Industrial                                                                    
     Development and Export Authority.                                                                                          
          (b)  This section constitutes legislative                                                                             
     approval required by AS 44.88.095(g)."                                                                                     
                                                                                                                                
SENATOR STEDMAN explained that the  amendment authorizes AIDEA to                                                               
issue  bonds to  finance the  infrastructure and  construction of                                                               
the Bokan-Dotson  Ridge Rare Earth  Element Project. He  read the                                                               
above amendment.                                                                                                                
                                                                                                                                
He highlighted  the permissive  language giving  AIDEA discretion                                                               
in its bonding authority, up to  $145 million. He also noted that                                                               
he had an amendment to clarify  some of the language in Amendment                                                               
1.                                                                                                                              
                                                                                                                                
2:15:09 PM                                                                                                                    
SENATOR OLSON asked if AIDEA has an opinion on the amendment.                                                                   
                                                                                                                                
SENATOR STEDMAN  replied he worked  with AIDEA on  the amendment,                                                               
but would prefer to hear from them directly.                                                                                    
                                                                                                                                
MR.  DAVIS said  AIDEA has  no  objection to  the amendment,  but                                                               
would suggest  additional clarification that AIDEA  could use the                                                               
bonds for ownership or financing.                                                                                               
                                                                                                                                
SENATOR  OLSON  asked  if  the  sponsor has  an  opinion  on  the                                                               
amendment.                                                                                                                      
                                                                                                                                
2:16:08 PM                                                                                                                    
SENATOR  LESIL MCGUIRE,  sponsor  of SB  99,  stated support  for                                                               
Amendment 1.                                                                                                                    
                                                                                                                                
SENATOR MICCICHE asked the total in the SETS fund.                                                                              
                                                                                                                                
MR.  DAVIS  replied  the  SETS   fund  total  is  $67.5  million.                                                               
Responding  to  a  further  question,   he  explained  that  this                                                               
authorizes  the AIDEA  Board, in  its discretion,  to issue  SETS                                                               
bonds that would be sold on the private market.                                                                                 
                                                                                                                                
SENATOR MICCICHE referenced AS  44.88.095(g) and highlighted that                                                               
this project wouldn't come back  before the legislature. It gives                                                               
AIDEA the authority to bond up to $145 million.                                                                                 
                                                                                                                                
MR. DAVIS agreed; this is  asking for legislative approval for an                                                               
upper limit.                                                                                                                    
                                                                                                                                
SENATOR MICCICHE asked if it's  typical that bonding authority at                                                               
this level wouldn't come back to the legislature.                                                                               
                                                                                                                                
MR. DAVIS confirmed  this is the process, and  explained that the                                                               
Skagway ore terminal  was a similar project. AIDEA  asked for and                                                               
received authorization  to issue up  to $80 million in  bonds for                                                               
that project, although the full bonding has not been used.                                                                      
                                                                                                                                
2:18:21 PM                                                                                                                    
CHAIR  DUNLEAVY   removed  his  objection.  Finding   no  further                                                               
objection, Amendment 1 was adopted.                                                                                             
                                                                                                                                
2:18:35 PM                                                                                                                    
SENATOR  STEDMAN moved  [conceptual]  Amendment  2. He  explained                                                               
that it amends Amendment 1.                                                                                                     
                                                                                                                                
CO-CHAIR DUNLEAVY objected for discussion purposes.                                                                             
                                                                                                                                
                          AMENDMENT 2                                                                                       
                                                                                                                                
                                                                                                                                
    OFFERED IN THE SENATE                    BY SENATOR STEDMAN                                                                 
          TO:  Amendment 1, 28-LS0741\A.3, for SB 99                                                                            
                                                                                                                                
     Page 1, line 17:                                                                                                           
     Following: "Bokan-Dotson Ridge rare earth element"                                                                         
          Delete: "project shall be owned"                                                                                      
          Insert: projects surface complex shall be owned or                                                                    
     financed"                                                                                                                  
                                                                                                                                
SENATOR STEDMAN described the above amendment.                                                                                  
                                                                                                                                
2:19:36 PM                                                                                                                    
SENATOR OLSON  asked if other  projects would be affected  by the                                                               
amendment.                                                                                                                      
                                                                                                                                
MR. DAVIS  replied that this  authority is specific to  the Bokan                                                               
project. Amendment 2 clarifies that  AIDEA has determined that it                                                               
can  only lend  on  the surface  and could  not  use bonding  for                                                               
working capital  or underground equipment  that might be  used in                                                               
the mine.  He noted that the  idea of financing to  ownership was                                                               
his suggestion.                                                                                                                 
                                                                                                                                
SENATOR OLSON asked for assurance  this wouldn't encumber the Red                                                               
Dog Mine and the connecting road.                                                                                               
                                                                                                                                
MR. DAVIS replied this would not  affect that mine; it only gives                                                               
authorization for the Bokan project.                                                                                            
                                                                                                                                
SENATOR  MICCICHE asked  if  it's unlikely  that  a state  agency                                                               
would  operate this  project, although  it's authorized  under AS                                                               
44.88.172 - 44.88.177.                                                                                                          
                                                                                                                                
MR.  DAVIS   confirmed  that  those  statutes,   particularly  AS                                                               
44.88.172(a), permit AIDEA  to own or partially own  or finance a                                                               
project. However,  AIDEA usually contracts projects  out or seeks                                                               
private partners so another entity operates the project.                                                                        
                                                                                                                                
2:23:26 PM                                                                                                                    
CHAIR  DUNLEAVY  removed  his   objection  and  Amendment  2  was                                                               
adopted.                                                                                                                        
                                                                                                                                
2:24:04 PM                                                                                                                    
KEN  COLLISON,  Chief  Operating   Officer,  Ucore  Rare  Metals,                                                               
introduced himself.                                                                                                             
                                                                                                                                
SENATOR STEDMAN  asked Mr. Collison to  describe the Bokan-Dotson                                                               
Ridge Rare Earth Project.                                                                                                       
                                                                                                                                
MR. COLLISON  explained that there  are about 16 elements  in the                                                               
periodic table that are classified  as light and heavy rare earth                                                               
elements (REEs),  but only the  heavy REEs are rare  and critical                                                               
to both  green energy and  the military.  Right now more  than 95                                                               
percent of the heavy rare earths  originate in China, so there is                                                               
impetus to  create a  "Made in  the USA"  supply of  rare earths.                                                               
Ucore is  part of  that effort  and has  contracts with  both the                                                               
Department of  Defense and  the Department  of Energy  to further                                                               
that goal.                                                                                                                      
                                                                                                                                
MR. COLLISON said  that a preliminary economic  assessment of the                                                               
Bokan-Dotson  Ridge  Rare   Earth  Project  ("Project")  predicts                                                               
capital costs  of $221  million. Upon review  with AIDEA,  it was                                                               
determined that $191  million could be bonded, but  AIDEA is only                                                               
authorized to  bond 75  percent of that.  Thus, the  $145 million                                                               
provided in Amendment 1.                                                                                                        
                                                                                                                                
He  explained that  the Project  is a  1,500 ton/day  underground                                                               
mine that uses  new technology so there will be  no tailings left                                                               
on  the surface  when the  mine  closes. The  timeline calls  for                                                               
permitting to  begin late in  the first  quarter of this  year or                                                               
soon  thereafter.  He  expressed  hope that  the  mine  would  be                                                               
permitted more quickly than others  since it's underground, has a                                                               
very small  footprint, and will  have no tailings on  the surface                                                               
at closure.  The feasibility study  and the engineering  for some                                                               
of  the  major equipment  will  run  concurrently and  should  be                                                               
finished by year  end. Down payments on the  major equipment will                                                               
be  due  shortly  thereafter  so  that it  doesn't  hold  up  the                                                               
project.                                                                                                                        
                                                                                                                                
MR.  COLLISON  said  this  legislation  will be  a  big  help  in                                                               
developing the  Project, and it  will show the  financial markets                                                               
and  the rest  of the  mining industry  that Alaska  is open  for                                                               
business.  The  state will  also  benefit  from additional  jobs.                                                               
During the estimated 1.5 year  construction, the onsite workforce                                                               
will peak  at about  300 employees, which  will create  about 125                                                               
indirect  jobs.  During  operations   there  will  be  about  190                                                               
employees  and  that  should  create  about  150  indirect  jobs.                                                               
Current  estimates  indicate that  about  340  new jobs  will  be                                                               
created in the state. In  Alaska, the average income for somebody                                                               
in  mining is  between $80,000  and  $100,000 so  these are  very                                                               
good, year around jobs.                                                                                                         
                                                                                                                                
CO-CHAIR DUNLEAVY asked the predicted life of the mine.                                                                         
                                                                                                                                
MR.  COLLISON replied  it's 11  years  but if  mines like  Greens                                                               
Creek  and Red  Dog are  indicative, it  will last  several times                                                               
longer than  that. It's promising  that the  ore body is  open at                                                               
depth  and on  strike and  that the  property has  numerous other                                                               
rare earth showings.                                                                                                            
                                                                                                                                
2:29:30 PM                                                                                                                    
SENATOR  MICCICHE  referenced  a  handout  in  the  packets  that                                                               
specifically  identifies  Dy,  Tb,  and Y  as  heavy  rare  earth                                                               
elements available  at Bokan Mountain.  He requested  an expanded                                                               
discussion of REEs.                                                                                                             
                                                                                                                                
MR. COLLISON  identified the three  REEs as  dysprosium, terbium,                                                               
and neodymium. He  explained that one of their uses  is to reduce                                                               
the size  of magnets,  which is critical  for things  like hybrid                                                               
cars  and   aviation  engines.  The  Department   of  Energy  has                                                               
identified  these three  rare earths  and inyttrium  as the  most                                                               
critical for [military equipment].  The Department of Defense has                                                               
identified them as  "subject to interruption of  supply, based on                                                               
actions or  events outside the  control of the government  of the                                                               
United States."                                                                                                                 
                                                                                                                                
SENATOR MICCICHE  asked if the  mine is economically  feasible at                                                               
the indicated  resource quantities or if  inferred resources have                                                               
to be included.                                                                                                                 
                                                                                                                                
MR.  COLLISON replied  the  preliminary  economic assessment  was                                                               
done on  inferred resources, as  is common. Ucore has  since done                                                               
more drilling and now has  both indicated and inferred resources.                                                               
Another drill  program this coming  summer will move  the balance                                                               
of inferred resources to indicated  resources, and add some. It's                                                               
necessary to have  at least an indicated resource in  order to do                                                               
a feasibility study, so that's  the intent this coming summer, he                                                               
said.                                                                                                                           
                                                                                                                                
CO-CHAIR DUNLEAVY stated that public  testimony would remain open                                                               
and he would hold SB 99 in committee for further consideration.                                                                 
                                                                                                                                
2:31:55 PM                                                                                                                    
At ease                                                                                                                         
                                                                                                                                
         SB 140-AIDEA: ARCTIC DEVELOPMENT PROGRAM/FUND                                                                      
                                                                                                                                
2:32:48 PM                                                                                                                    
CO-CHAIR  DUNLEAVY  reconvened  the  meeting  and  announced  the                                                               
consideration   of  SB   140."An    Act   creating  the   Arctic                                                               
infrastructure  development  program  and   fund  in  the  Alaska                                                               
Industrial Development and Export  Authority." This was the first                                                               
hearing.                                                                                                                        
                                                                                                                                
2:33:04 PM                                                                                                                    
SENATOR MCGUIRE, sponsor of SB 140, introduced the legislation                                                                  
speaking to the following sponsor statement:                                                                                    
                                                                                                                                
     Globally,  all  eyes  are  on  the  Arctic.  The  World                                                                    
     Economic   Forum   has   recently   identified   Arctic                                                                    
     Infrastructure development  as one of the  top Four (4)                                                                    
     challenges facing  the regions.  Alaska's future  is in                                                                    
     the Arctic, and in order  for Alaskans to capitalize on                                                                    
     the   incredible   opportunities   and   overcome   the                                                                    
     significant  challenges that  this region  presents, we                                                                    
     must begin to build infrastructure now.                                                                                    
                                                                                                                                
     Aside  from  a few  areas  in  Norway and  the  Russian                                                                    
     Federation  the  Arctic  as   a  whole  remains  vastly                                                                    
     underserved  by  transportation, ports,  communication,                                                                    
     emergency   response,   defense  and   other   critical                                                                    
     infrastructure.  For  further   development  to  occur,                                                                    
     which  Alaskans   deserve,  both  public   and  private                                                                    
     interests must  come together  to boost  the investment                                                                    
     in the Arctic.                                                                                                             
                                                                                                                                
     For these  reasons I have  introduced Senate  Bill 140,                                                                    
     Arctic  Infrastructure  Development Fund  ("AIDF").  SB                                                                    
     140  expands AIDEA's  tool bag  by  extending the  same                                                                    
     authority for  loans, loan  guarantees, bonds  and bond                                                                    
     guarantees  that it  currently utilizes  in the  energy                                                                    
     sector via the  SETS fund (AS 44.88.650-  690) in order                                                                    
     to  develop Infrastructure  in the  Arctic. AIDEA  used                                                                    
     SETS  to  facilitate  the  financing  of  the  Interior                                                                    
     Energy Project.  This tool helps to  create the public-                                                                    
     private  partnerships  that  are  needed  to  encourage                                                                    
     large investment in capital intensive infrastructure.                                                                      
                                                                                                                                
     Senate  Bill  140  extends AIDEA's  existing  power  to                                                                    
     finance,  or facilitate  the financing  of projects  to                                                                    
     the  realm of  Arctic  Infrastructure  by granting  the                                                                    
     Authority the ability to:                                                                                                  
     1. Insure  project obligations  and guarantee  loans or                                                                    
     bonds for projects.                                                                                                        
     2. Defer principle payments and capitalize interest.                                                                       
     3. Offer financing terms of up to 30 years.                                                                                
     4.  Enter   into  lease   agreements,  sales-lease-back                                                                    
     agreements,   build-operate-transfer   agreements   and                                                                    
     other  agreements  to   finance  Arctic  infrastructure                                                                    
     projects.                                                                                                                  
                                                                                                                                
     These powers  already provide  flexible terms  that can                                                                    
     reduce  the  ultimate  cost of  energy  (via  the  SETS                                                                    
     program)  to  consumers, and  if  it  can work  in  the                                                                    
     energy realm, it can  work for infrastructure. However,                                                                    
     SB   140  also   requires   legislative  approval   for                                                                    
     investments  that   are  more   than  one-third   of  a                                                                    
     project's capital costs or if  a loan guarantee exceeds                                                                    
     $20  Million.  By  subjecting  certain  investments  to                                                                    
     legislative approval,  SB 140 maintains  an appropriate                                                                    
     level of due diligence for projects.                                                                                       
                                                                                                                                
     By   making   financing   available  we   can   empower                                                                    
     communities  and attract  a global  pool of  investment                                                                    
     that is  an alternative to the  traditional grant model                                                                    
     that  too  often  underfunds   projects  and  leads  to                                                                    
     delays. Relying  on credit  also ensures  that sponsors                                                                    
     have  some  skin  in  the  game  and  a  stake  in  the                                                                    
     project's  success.  Most  importantly, we  expand  the                                                                    
     arena of where  Alaskan assets are working  in order to                                                                    
     grow  our  own  economy. Currently,  many  of  Alaska's                                                                    
     savings accounts are invested  in stocks and bonds that                                                                    
     drive  economic  activity  outside of  Alaska.  SB  140                                                                    
     suggests  instead   that  some  of  those   savings  be                                                                    
     invested  here in  Alaska through  AIDEA, not  as blank                                                                    
     checks  for development,  but  as  investments for  our                                                                    
     future in Arctic Infrastructure.                                                                                           
                                                                                                                                
     For  the purposes  of  this Act,  I  propose that  this                                                                    
     program  and fund  focus infrastructure  development in                                                                    
     the geographical  definition of the Arctic  as laid out                                                                    
     in Arctic Research and Policy  Act (amended 1990). That                                                                    
     definition  includes the  area of  the State  of Alaska                                                                    
     north  of the  Arctic  Circle, north  and  west of  the                                                                    
     boundary formed by the  Porcupine, Yukon, and Kuskokwim                                                                    
     Rivers,  all  contiguous  seas,  including  the  Arctic                                                                    
     Ocean, and the Beaufort,  Bering, and Chukchi Seas, and                                                                    
     the Aleutian chain.                                                                                                        
                                                                                                                                
     With AIDF I am proposing that the State expand AIDEA's                                                                     
        existing authority to finance, or facilitate the                                                                        
     financing of, Arctic Infrastructure.                                                                                       
                                                                                                                                
2:43:30 PM                                                                                                                    
SENATOR STEDMAN agreed  with the bill sponsor that  Alaska has to                                                               
get  aggressive  in  developing   infrastructure  in  the  Arctic                                                               
because the federal government is lagging.                                                                                      
                                                                                                                                
JESSE LOGAN, Staff, Senator Lesil  McGuire, stated that after the                                                               
bill was  introduced the  sponsor worked  with AIDEA,  the Arctic                                                               
Policy  Commission, and  other stakeholders  to identify  ways to                                                               
strengthen  the   bill  and  help   the  development   of  Arctic                                                               
infrastructure. He noted  the packets contain a  sectional of the                                                               
suggested changes.                                                                                                              
                                                                                                                                
SENATOR  STEDMAN  asked  if  the process  will  be  to  introduce                                                               
potential changes and return with a committee substitute.                                                                       
                                                                                                                                
MR. LOGAN said yes.                                                                                                             
                                                                                                                                
CHAIR DUNLEAVY asked Mr. Davis if he had anything to add.                                                                       
                                                                                                                                
MARK DAVIS,  Deputy Director,  Alaska Industrial  Development and                                                               
Export Authority,  (AIDEA), agreed with  Mr. Logan that  AIDEA is                                                               
working  with  the  sponsor's  office  on  a  possible  committee                                                               
substitute.                                                                                                                     
                                                                                                                                
2:45:30 PM                                                                                                                    
STEPHEN TRIMBLE,  President, Trimble  Strategies, LLC  and public                                                               
member  of the  Alaska Arctic  Policy Commission,  stated support                                                               
for SB 140,  which would create an  Arctic infrastructure program                                                               
and fund within  AIDEA. He described the Arctic as  the future of                                                               
Alaska   and   emphasized   the  importance   of   investing   in                                                               
infrastructure now  in order to  have a meaningful place  in this                                                               
new  global frontier.  Industry  has responded  to  the call  for                                                               
public investment and  now is the time  to further public/private                                                               
investment  within   Alaska.  Enabling  AIDEA  with   the  powers                                                               
provided by SB 140 is an investment in the future of Alaska.                                                                    
                                                                                                                                
2:47:11 PM                                                                                                                    
STEPHEN KLINE,  Managing Principle, First Infrastructure  Inc., a                                                               
consulting firm based  in New Jersey, said he is  testifying as a                                                               
professional in the financial field.  He reported that he advises                                                               
AIDEA  on a  number of  matters, the  regulations and  procedures                                                               
relating to the SETS fund in particular.                                                                                        
                                                                                                                                
He related that he is  a strong proponent of guarantee structures                                                               
to  stretch  relatively  scarce public  sector  dollars  for  the                                                               
benefit of what  are deemed to be  worthwhile projects. Utilizing                                                               
such  a structure  in support  of Arctic  infrastructure projects                                                               
would be  a wise use of  the state's scarce public  resources, he                                                               
said.                                                                                                                           
                                                                                                                                
2:49:24 PM                                                                                                                    
CHRIS  HLADICK,  Manager,  City of  Unalaska,  Unalaska,  Alaska,                                                               
reported that  he served on  both the Northern Waters  Task Force                                                               
and the Arctic Policy Commission  and is testifying in support of                                                               
SB  140. He  said  that  Unalaska is  seeing  explosive needs  to                                                               
accommodate  the  anticipated  arrival   of  the  oil  companies.                                                               
Infrastructure  needs  have  been identified  that  will  require                                                               
public/private partnership  and SB 140 provides  another tool. He                                                               
acknowledged   that    a   lot   of   places    need   additional                                                               
infrastructure,  and  pointed  out that  all  the  infrastructure                                                               
development in places  like Kotzebue, Nome or  Port Clarence will                                                               
have to pass through Unalaska/Dutch Harbor.                                                                                     
                                                                                                                                
CO-CHAIR  DUNLEAVY  commented  that  he  was  impressed  when  he                                                               
visited Unalaska.                                                                                                               
                                                                                                                                
SENATOR MICCICHE asked if the  changes in Section 8 would include                                                               
the ability for LNG storage and infrastructure needs.                                                                           
                                                                                                                                
MR. HLADICK said he didn't know.                                                                                                
                                                                                                                                
SENATOR  MICCICHE asked  to hear  from the  sponsor after  public                                                               
testimony so she could answer the question.                                                                                     
                                                                                                                                
2:52:10 PM                                                                                                                    
RON LONG, Assistant City Manager,  City of Seward, stated that if                                                               
the  state  is to  succeed  in  the  development of  the  Arctic,                                                               
whether  it's in  fisheries,  resource  development, tourism,  or                                                               
response  and monitoring  capacity  for  foreign flagged  vessels                                                               
transiting  the Bering  Straits, it  is critical  to have  a deep                                                               
water port or  ports to support the effort. SB  140 helps advance                                                               
those  goals. AIDEA's  track record  with Red  Dog transportation                                                               
infrastructure and Alaska Ship and  Dry Dock speaks well of their                                                               
ability to help move these projects forward.                                                                                    
                                                                                                                                
He expressed  hope that  as the  bill moves  forward it  would be                                                               
amended  to  include  provisions  that  will  build  on  existing                                                               
capacity within  the state to  support the staging  and logistics                                                               
necessary to  make a number  of port developments  successful. He                                                               
noted  that   when  he  attended   an  Institute  of   the  North                                                               
presentation in  Seattle on Arctic opportunities  and challenges,                                                               
a  representative  from a  Washington  state  port declared  that                                                               
Bellingham would  be the  gateway to the  Arctic. He  warned that                                                               
just  as other  nations are  moving into  the Arctic  with active                                                               
plans and resource  commitments while the U.S. is  trying to form                                                               
an action plan,  other states are looking  for opportunities that                                                               
should remain in Alaska.                                                                                                        
                                                                                                                                
SENATOR MICCICHE  expressed appreciation  for the recent  tour of                                                               
Seward's  breakwater  expansion.  He   observed  that  there  are                                                               
communities that  are ready to  support the Arctic,  although all                                                               
need a  bit of infrastructure boost  to ensure the safety  of the                                                               
services.                                                                                                                       
                                                                                                                                
2:55:33 PM                                                                                                                    
CHAIR  DUNLEAVY asked  Senator Micciche  to restate  his question                                                               
for the sponsor.                                                                                                                
                                                                                                                                
SENATOR MICCICHE expressed interest  in helping with an amendment                                                               
to ensure that  the bill will consider  energy infrastructure and                                                               
projects in western and northwest Alaska.                                                                                       
                                                                                                                                
SENATOR MCGUIRE said  that has already been addressed  both in SB                                                               
140 and the  changes to SETS in SB 99.  She described where these                                                               
changes are  found. Section  11, paragraphs (18)  and (19)  of SB                                                               
140   change  the   way  "Arctic"   and  "Arctic   infrastructure                                                               
development" is  defined so that  all of Alaska can  benefit from                                                               
the new  fund. On  page 3,  lines 1-4,  of SB  99 it  states that                                                               
liquefaction,  regasification   storage,  and  natural   gas  are                                                               
included in the definition of "qualified energy development."                                                                   
                                                                                                                                
2:59:14 PM                                                                                                                    
CO-CHAIR DUNLEAVY  announced he  would hold  SB 140  in committee                                                               
for further  consideration. Public  testimony would be  opened at                                                               
the next hearing.                                                                                                               
                                                                                                                                
2:59:59 PM                                                                                                                    
There being  no further  business to  come before  the committee,                                                               
Chair Dunleavy  adjourned the Senate Labor  and Commerce Standing                                                               
Committee meeting at 2:59 p.m.                                                                                                  

Document Name Date/Time Subjects
SB159.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
Sponsor Statement for SB159.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
Section Summary for SB159.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159-DCCED-DOI-2-10-14.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
02 – Division of Insurance letter by Katie Campbell to Dina Yunker, 12 November 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
03 – Division of Insurance letter by Katie Campbell to Airlift Northwest, 16 July 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
04 – Division of Insurance letter by Katie Campbell to Dina Yunker, 19 August 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
A - State tells medevac payment program to drop Alaska members, 26 November 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
Airlift Northwest letter, 22 November 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
B - Medevac insurance plan shut, Chilkat Valley News, 5 December 2013.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB 159 Support Letter_Airlift NW.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB 159_Support Letter_CommissionOnAging.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159_Support Letter_SEAFA.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159_Support Letter_SEAFA.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159_Letter of Support_Guggenbickler.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159_SupportLetter_Brantner.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB159_SupportLetter_Dangel.pdf SL&C 2/18/2014 1:30:00 PM
SB 159
SB 99A (28-LS0741A).pdf SL&C 2/18/2014 1:30:00 PM
SB 99
SB 99 Sponsor Statement.pdf SL&C 2/18/2014 1:30:00 PM
SB 99
SB 99 Sectional Analysis.pdf SL&C 2/18/2014 1:30:00 PM
SB 99
SB99-DCCED-AIDEA-02-14-14.pdf SL&C 2/18/2014 1:30:00 PM
SB 99
SB 99 Supporting Document- AS 44.88.650-690; AS 44.88.900.pdf SL&C 2/18/2014 1:30:00 PM
SB 99
Proposed Amendment to Senate Bill 99 FINAL.PDF SL&C 2/18/2014 1:30:00 PM
SB 99
SB 140 A.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB 140 Sponsor Statement.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB 140 Sectional Analysis (2).pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB 140 Sectional Analysis.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB 140 ARPA_Polar map.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB140-DCCED-AIDEA-02-14-14.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB140_PotentialChanges.pdf SL&C 2/18/2014 1:30:00 PM
SB 140
SB140_Planning and Infrastructure Section of AAPC Preliminary Report.pdf SL&C 2/18/2014 1:30:00 PM
SB 140