Legislature(1993 - 1994)
03/10/1994 01:45 PM Senate L&C
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
SENATE LABOR AND COMMERCE COMMITTEE
March 10, 1994
1:45 P.M.
MEMBERS PRESENT
Senator Tim Kelly, Chairman
Senator Steve Rieger, Vice Chairman
Senator Bert Sharp
Senator Georgianna Lincoln
Senator Judith Salo
MEMBERS ABSENT
None
COMMITTEE CALENDAR
HOUSE BILL NO. 327
"An Act extending the termination date of the Board of Veterinary
Examiners; and providing for an effective date."
SENATE BILL NO. 227
"An Act relating to terminal rental adjustment clauses for motor
vehicles and trailers."
SENATE BILL NO. 341
"An Act extending the termination date of the Alaska Tourism
Marketing Council; and providing for an effective date."
SENATE BILL NO. 213
"An Act extending the Alaska Public Utilities Commission and the
regulatory cost charge."
SB 340 (DAMAGES & ATTY FEES FOR UNPAID WAGES) WAS SCHEDULED, BUT
NOT HEARD THIS DATE.
PREVIOUS ACTION
SB 327 - No previous action to record.
SB 227 - See State Affairs minutes dated 2/16/94.
SB 341 - No previous action to record.
SB 213 - See Labor & Commerce minutes dated 9/28/93, 2/8/94, and
2/24/94.
WITNESS REGISTER
Carol Carrol, Legislative Aide
c/o Senator Kerttula
State Capitol
Juneau, Ak. 99801-1182
POSITION STATEMENT: Sponsor of SB 227.
Josh Fink, Legislative Aide
c/o Senator Kelly
State Capitol
Juneau, Ak. 99801-1182
POSITION STATEMENT: Commented on SB 213.
Bob Lohr, Executive Director
Alaska Public Utilities Commission
1016 W 6th Ave., # 400
Anchorage, Ak. 99501
POSITION STATEMENT: Commented on SB 213.
Don Schroer
Alaska Public Utilities Commission
1016 W. 6th Ave., # 400
Anchorage, Ak. 99501
POSITION STATEMENT: Commented on SB 213.
Dave Hutchins, Executive Director
Alaska Rural Energy Cooperative Association
POSITION STATEMENT: Commented on SB 213.
Dennis Geary
Alaska Public Employees Association
1689 C Street, # 204
Anchorage, Ak. 99501
POSITION STATEMENT: Commented on SB 213.
Jim Rowe
Alaska Telephone Association (ATA)
4341 B St., #304
Anchorage, Ak. 99503
POSITION STATEMENT: Commented on SB 213.
ACTION NARRATIVE
TAPE 94-15, SIDE A
Number 001
CHAIRMAN KELLY called the Labor and Commerce Committee meeting to
order at 1:45 p.m. and announced HB 327 (EXTEND BOARD OF VETERINARY RY
EXAMINERS) to be up for consideration.
SENATOR RIEGER moved to pass HB 327 from committee with individual ual
recommendations. There were no objections and it was so ordered.
SENATOR KELLY announced SB 227 (MOTOR VEHICLE RENTAL TERMS) to be
up for consideration.
CAROL CARROL, Legislative Aide to Senator Kerttula, testified that
SB 227 makes a minor change in law that would clarify that tract
clauses in leases, in and of themselves, do not change the nature
of a lease. A tract clause is a device used by a lessor and a
lessee to come to more favorable lease terms when the lessee will
maintain the vehicle in a better condition so that the asset turns
out to be worth more at the end of the lease.
SENATOR RIEGER moved to pass SB 227 from committee with individual
recommendations. There were no objections and it was so ordered.
Number 124
SENATOR KELLY announced SB 341 (EXTEND TOURISM MARKETING COUNCIL)
to be up for consideration.
SENATOR RIEGER moved to pass SB 341 from committee with individual
recommendations. There were no objections and it was so ordered.
SENATOR KELLY announced SB 213 (APUC EXTENSION AND REGULATORY COST T
CHARGE) to be up for consideration. He said his aide, Josh Fink,
had been working on a proposed CS.
MR. FINK explained that the first section would make the four
section heads partially exempt, a proposal from the Alaska
Telephone Association.
Section two increases the regulatory cost charge from .61% to .8%.
That change is because of section 3 which allows electric utilities
to subtract the cost of power from their gross revenues before the
RCC applies. If that happens, APUC had indicated that RCC rates
would rise 35%. The .61% cap would not allow them to grow or meet
their budget in future years. He said they are currently not
charging the full .61%.
Number 200
BOB LOHR, Executive Director, Alaska Public Utilities Commission
(APUC), said the current rate is .4% of the jurisdiction's gross
revenues. He said if the RCC rates have to rise by 35%, an
estimate based on preliminary figures, they would have to raise the
cap to .8%.
SENATOR KELLY said in response to Eureka who feels they are paying
too much of the load of the APUC through their RCC charges, it
looks like the bill would reduce theirs and redistribute it to the
other utilities to balance out the load.
DON SCHROER, APUC, said that everyone's rate would adjust.
SENATOR SHARP said he didn't see how they needed an authorization
increase, since rates would have to go up more than 50% in order to
reach the .61% cap.
SENATOR RIEGER said it looks like they are saying because they are
taking so much out of the base, that .8% of the new base is as much
as .61% of the old base.
Number 227
DAVE HUTCHINS, Executive Director, Alaska Rural Energy Cooperative
Association, agreed with Senator Rieger's analysis. The reason is
based on the study done by the legislative auditor showed that at
the present time the workloads that electrics bring the APUC is 30%
and declining and the financial support through RCC, that the
electrics have to pay for the APUC, is 42% and increasing. They
think there is a flaw in the present formula and SB 213 is a simple
way to correct it.
MR. FINK said the 35% figure he gave was based on the definition in
section 3 of cost of power. According to the APUC if they went
with the broader definition, they would be increasing RCC rates for
everyone else 45%.
Number 274
Section 4 explains that when the RCC charges are collected for the
4th quarter, the fiscal year has ended so that money does not lapse
into the general fund. Instead, it lapses as program receipts into
the following year, MR. FINK said.
Section 5 - 10 all are a result of a conceptual amendment adopted
at the recommendation of the auditor that makes it easier for
utility consumers to opt in or opt out of economic regulation.
Currently 25% of the utility subscribers have signed a petition to
do either one.
SENATOR LINCOLN asked if all of the language in section 8 of
version K would move over into the J version. SENATOR KELLY noted
that was the understanding.
MR. FINK said that section 13 is an extension until 1998 of the
Board that sunsets this year. Section 14 repeals the sunset on the
regulatory cost charge, because that can be looked at at the same
time as the sunset for the Board.
Section 15 is at the recommendation of the auditor and would
stagger the terms of the two commissioners that are about to
expire.
Number 346
SENATOR KELLY asked if section 11 affected Alyeska? MR. FINK said
he thought it would. MR. LOHR said that it would apply to all TAPS
carriers, but only for the intrastate portion of their revenues
which is less than 5% of their gross revenues from the entire
system.
SENATOR LINCOLN asked for clarification on 1999 in section 15. MR.
FINK explained that the extension of the commission is 4 years and
in section 15 the reason they use 1999 is because it's the first
time they can do it without affecting current members.
MR. LOHR said it appears to be about $500,000 and $600,000 worth of
all RCC revenue from all jurisdictional pipeline carriers,
including TAPS.
SENATOR KELLY said he wanted to make certain they were not opening
up a big increase just on Alyeska. MR. ROWE said they would get
the same increase attributable to any other utility affected by the
exclusion of a portion of electric revenues.
DENNIS GEARY, Alaska Public Employees Association, supported SB 213
in that it extends the APUC. They do object to proposed section 1
which excludes certain supervisory unit employees from the
classified personnel system. He said the employees in the APUC act
in a different capacity than other state agencies that have
commission staff and professional staff. He said no one now has
the designation of "section head" so it's unclear who it would
apply to. In other state agencies, the professional staff carries
out the desires of the commissioned staff. In the APUC that
doesn't happen. There the staff actually acts as a part of an
independent group from the commissioned staff. Removal of the
employees from the professional staff from the classified service
makes those employees not bound by the laws and regulations of the
state of Alaska, but more to the political agenda in the arena at
the time. This is not something that would be beneficial to the
state, to the employees, or to the consumers.
MR. LOHR responded that they want that section in the bill and the
four people are not identified in the bill, but their positions are
identified on their work cards. He said it,s hard to move people
around with current statute.
SENATOR KELLY said it wasn't his intention to move the bill today.
Number 448
SENATOR LINCOLN noted a statement in a letter from APUC that says
the chairman of the APUC informed APEA that APUC did not request
that the section heads be excluded from the classified service.
MR. LOHR said he thought ATA proposed that the whole APUC be
partially exempt. Knowing that wouldn't pass, the second choice
was section heads.
JIM ROWE, Alaska Telephone Association (ATA), said the language
they put into section 13 was to facilitate the APUC with sufficient
staff, sufficient expertise, particularly with all the changes
coming with telecommunications.
SENATOR KELLY announced that they would drop the amendment from the
CS and adjourned the meeting at 2:20 p.m.
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