Legislature(1995 - 1996)
02/14/1995 03:40 PM Senate STA
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
SENATE STATE AFFAIRS
February 14, 1995
3:40 p.m.
MEMBERS PRESENT
Senator Bert Sharp, Chairman
Senator Randy Phillips, Vice-Chairman
Senator Loren Leman
Senator Jim Duncan
MEMBERS ABSENT
Senator Dave Donley
COMMITTEE CALENDAR
SENATE BILL NO. 54
"An Act relating to exclusive service areas for utilities
certificated to provide electric utility service and to the
definition of 'general public' for utilities furnishing electric
service."
SENATE BILL NO. 5
"An Act prescribing the use and characteristics of voting booths
employed in elections and the color of ballots used in state
primary elections."
SENATE BILL NO. 51
"An Act relating to income of the permanent fund; and providing for
an effective date."
PREVIOUS SENATE COMMITTEE ACTION
SB 54 - No previous senate committee action.
SB 5 - No previous senate committee action.
SB 51 - No previous senate committee action.
WITNESS REGISTER
David Hutchens, Executive Director
Alaska Rural Electric Cooperative Association, Inc.
703 W. Tudor, #200, Anchorage, AK 99503¶463-3636
POSITION STATEMENT: supports SB 54
Jim Arneson
Commercial Refuse
1825 Ship Avenue, Anchorage, AK 99501¶277-3725
POSITION STATEMENT: testified on SB 54
Jimmy Jackson, GCI
2550 Denali Street, Anchorage, AK 99503¶265-5545
POSITION STATEMENT: opposes SB 54
Patricia Grenier, Aide to Senator Kelly
State Capitol, Juneau, Alaska, 99801-1182¶465-3822
POSITION STATEMENT: prime sponsor of SB 5
David Koivuniemi, Acting Director
Division of Elections
P.O. Box 110017, Juneau, AK 99811-0017¶465-4611
POSITION STATEMENT: testified on SB 5
Senator Steve Rieger
State Capitol, Juneau, Alaska, 99801-1182¶465-3879
POSITION STATEMENT: prime sponsor of SB 51
Jim Kelly, Research & Liaison Officer
Alaska Permanent Fund Corporation
P.O. Box 25500, Juneau, AK 99802-5500¶465-2047
POSITION STATEMENT: testified on SB 51
ACTION NARRATIVE
TAPE 95-5, SIDE A
Number 001
SSTA - 2/14/95
SB 54 ELECTRIC UTIL & SOLID WASTE REMOVAL
CHAIRMAN SHARP calls the Senate State Affairs Committee to order at
3:40 p.m and brings up SB 54 as the first order of business before
the committee. The chairman informs the committee that the
proposed committee substitute for SB 54 corrects a drafting error.
On page 1, line 14, the language to be deleted should be [AND
PRESENTLY OR FORMERLY SERVED BY], and not simply [PRESENTLY OR
FORMERLY], as was specified in the original version of the bill.
The chairman also notes that the committee has received written
testimony from the Alaska Rural Electric Cooperative Association,
Inc. (ARECA) and Commercial Refuse.
CHAIRMAN SHARP states it is his intent to take as much testimony as
possible today to hear input for possible changes to SB 54. The
committee will hold SB 54 in order to work on the bill, and will
hear it again next week. The chairman calls the first witness.
Number 070
DAVE HUTCHENS, Executive Director, Alaska Rural Electric
Cooperative Association, Inc. (ARECA), asserts that utilities are
most efficient when they are monopolies. In lieu of competition,
services and rates are regulated by the APUC (Alaska Public
Utilities Commission), unless the consumers of a particular utility
vote to opt out of regulation. Mr. Hutchens repeats information
already submitted to the committee in his written statement. Mr.
Hutchens states ARECA supports SB 54.
Number 165
CHAIRMAN SHARP asks Mr. Hutchens if he thinks the wording change in
the proposed committee substitute is required.
MR. HUTCHENS thinks it is required.
Number 170
JIM ARNESON, Commercial Refuse, testifying from Anchorage via
teleconference, states he has already provided written copy of his
comments to the committee. Mr. Arneson would like to see either
full or partial deregulation of the refuse industry. He does not
think the refuse industry possesses the characteristics of a
natural monopoly. Mr. Arneson repeats the information already
submitted to the committee in writing.
Number 228
SENATOR RANDY PHILLIPS asks Mr. Arneson how many certificates have
been issued for refuse hauling in the Anchorage area.
MR. ARNESON lists four companies with certification.
SENATOR RANDY PHILLIPS asks Mr. Arneson if he is asking for
deregulation of the certificates.
MR. ARNESON responds he is asking for some sort of deregulation,
either partial or total. He is cautious about asking for total
deregulation.
Number 257
SENATOR RANDY PHILLIPS asks Mr. Arneson if he is currently only
serving commercial operations.
MR. ARNESON replies that is correct.
SENATOR RANDY PHILLIPS asks if the other operations are serving
commercial and residential operations.
MR. ARNESON replies that is correct.
SENATOR RANDY PHILLIPS asks Mr. Arneson if he thinks the other
companies would object to his suggestion of deregulation.
MR. ARNESON responds the other companies would object, mainly
because they do not want any competition.
Number 295
SENATOR LEMAN comments he philosophically agrees with Mr. Arneson.
Senator Leman is interested in taking a look possibly implementing
some of Mr. Arneson's suggestions.
CHAIRMAN SHARP reminds the committee that SB 54 will be held in
order to consider suggestions.
Number 307
SENATOR RANDY PHILLIPS asks Mr. Arneson how he heard about SB 54.
MR. ARNESON answers he tries to stay informed. He came across SB
54 while doing some research at the Anchorage Legislative
Information Office.
Number 320
JIMMY JACKSON, Attorney for GCI, states that, though GCI is not
directly affected by SB 54, maintaining the possibility of
competition in all utility markets is in the best interest of the
public. Therefore, GCI opposes SB 54, and particularly section 1.
Mr. Jackson thinks SB 54 is unnecessary. The APUC already has
ample authority to prevent harmful competition. He also thinks SB
54 would be harmful. Mr. Jackson says the trend in many places is
towards competition, not towards protecting service areas. The
affect of SB 54 may very well be to deny Alaska's citizens the
benefits of competition.
Number 355
SENATOR LEMAN says he was instrumental in passing legislation
allowing intrastate telephone competition. At the time, the
company that had the monopoly on intrastate telephone service said
allowing competition would not work. Time has shown that
competition is good for telephone companies and consumers. Senator
Leman asks Mr. Jackson if GCI's revenues have increased.
MR. JACKSON says GCI's revenues have increased. He is not sure if
Alascom's revenues have increased though. On the national level,
Mr. Jackson says both MCI and AT&T's revenues have increased with
competition. Mr. Jackson states monopolists will always assert
that competition cannot work. He does not think people will demand
that an extra set of wires be put down the street.
Number 385
CHAIRMAN SHARP comments, wires were put down both sides of the
street in some areas of Anchorage, until exclusive service areas
were established. So he has a problem allowing competition to come
in and "cherry-pick" the large, profitable loads. He is a strong
supporter of deregulating the whole system.
Number 405
SENATOR RANDY PHILLIPS asks Mr. Hutchens if the CEA (Chugach
Electric) or MEA (Matanuska Electric) has a position on SB 54.
MR. HUTCHENS does not think that CEA and MEA are opposed to SB 54.
He thinks MEA supports SB 54, but does not think there is an
official position from CEA.
Number 420
CHAIRMAN SHARP asks if anyone else wishes to testify on SB 54.
Hearing none, he announces that SB 54 will be held for future
consideration.
SSTA - 2/14/95
SB 5 ELECTION BALLOTS
SENATOR SHARP brings up SB 5 as the next order of business before
the Senate State Affairs Committee and calls the first witness.
Number 425
PATRICIA GRENIER, Aide to Senator Kelly, prime sponsor of SB 5,
reads the sponsor statement.
Number 442
SENATOR LEMAN comments he was not even aware of the different
colored ballots until someone pointed it out to him. He thinks it
is probably a good idea to make some of the changes, but is not
sure it is a big problem.
Number 465
SENATOR RANDY PHILLIPS did not know it was a problem either. The
biggest problem he heard was a change in the location of a polling
place.
Number 475
CHAIRMAN SHARP asks if the difference between the original bill and
the proposed committee substitute is the deletion of section 4.
MS. GRENIER replies that is correct.
SENATOR LEMAN asks if there currently is a definition in statute on
"voting booth".
MS. GRENIER responds that there is already a definition in the
statute.
SENATOR LEMAN notices the statute is amended by adding a new
paragraph to read.... So that apparently was not in statute. New
paragraph 37. Which you've deleted. Because the other definitions
throughout are satisfactory.
(There is not currently a definition in statute on "voting booth".)
Number 490
SENATOR RANDY PHILLIPS makes a motion to adopt CSSB 5(STA) in lieu
of the original bill.
CHAIRMAN SHARP, hearing no objection, states the committee
substitute has been adopted.
Number 495
SENATOR RANDY PHILLIPS asks the chairman if he noticed problems in
his precinct with the curtains on the voting booths.
CHAIRMAN SHARP responds that there weren't problems in his
precinct: he helped put the curtains up. He did not hear of any
problems in the Fairbanks precincts. The only complaint he heard
regarded the different colored ballots.
Number 525
DAVID KOIVUNIEMI, Acting Director, Division of Elections, states he
is available to answer question. The division neither supports nor
opposes SB 5.
SENATOR RANDY PHILLIPS asks Mr. Koivuniemi if the division received
any complaints relating to the problems addressed by SB 5.
MR. KOIVUNIEMI replies the division did receive some complaints,
mainly from the Anchorage area. The problem with non-curtained
"blue suitcase" type voting booths did not occur for lack of
regulations. Set-up of voting booths is contracted out, and the
contract specifies that the vendor is responsible for an even mix
of different types of voting booths at each precinct. Mr.
Koivuniemi adds that the definition section was deleted because
there was a problem with the portion specifying voting booths must
be at least six feet tall: none of the handicapped polling booths
are six feet tall.
MR. KOIVUNIEMI states that, as far as the different colored
election ballots, Lieutenant Governor Ulmer wanted him to express
to the committee that she was not happy with the different colored
primary ballots. As far as she is concerned, that would never
happen during her regime. Mr. Koivuniemi shows a sample ballot to
the committee. The ballots are stapled to a backing, and the
Division of Elections could have a white ballot with different
colored backings. He does not know why the ballots were designed
differently during this last primary.
Number 562
SENATOR LEMAN asks if it is important that the ballot be on white
paper, or important that it be all one color.
MR. KOIVUNIEMI responds the importance is in having one color, but
that white is probably less expensive. He notes that ballots are
required to be printed on white paper for the general election.
Number 571
SENATOR RANDY PHILLIPS asks Mr. Koivuniemi which areas of Anchorage
had complaints.
MR. KOIVUNIEMI says he does not know, but can check with the
Anchorage supervisor. There were complaints from around the state
regarding the ballot color.
Number 579
SENATOR LEMAN offers amendment #1 to CSSB 5(STA).
Amendment #1: on page 2, line 17, delete the words, "as for the
general election ballot".
TAPE 95-5, SIDE B
SENATOR LEMAN...delete those six words. Senator Leman moves his
amendment.
CHAIRMAN SHARP repeats Senator Leman's amendment, which would leave
the language: "The director shall print the ballot on white paper
and place the names...".
CHAIRMAN SHARP asks if there is any objection to amendment #1.
Hearing no objection, amendment #1 has been adopted.
SENATOR RANDY PHILLIPS makes a motion to discharge SB 5 from the
Senate State Affairs Committee with individual recommendations.
CHAIRMAN SHARP, hearing no objection, orders SB 5 released from
committee with individual recommendations.
SSTA - 2/14/95
SB 51 DISPOSITION OF PERMANENT FUND INCOME
SENATOR SHARP brings up SB 51 as the next order of business before
the Senate State Affairs Committee and calls the first witness.
Number 560
SENATOR RIEGER, prime sponsor of SB 51 reads his sponsor statement.
Number 515
SENATOR RIEGER states the Legislative Budget & Audit Committee
(LB&A) hired Ibbotsen & Associates to look at the asset allocation
of the Alaska Permanent Fund Corporation. Their report prescribed
a change in asset allocation. Senator Rieger has noticed that the
corporation is moving in the direction the Ibbotsen report
recommended. He thinks this will improve the longer term
investment performance of the permanent fund, and in turn, improve
the real earnings of the fund.
SENATOR RIEGER says he will answer questions and urges the
committee's favorable consideration.
Number 505
SENATOR LEMAN asks Senator Rieger if he thinks the consumer price
index (cpi) should continue to be used to value the permanent fund
earnings, or if there is a better index that could be used.
SENATOR RIEGER replies since the actual use of permanent fund
earnings is not spelled out anywhere, there is no right answer as
to which index should be used. Since the only prescribed use of
earnings right now are for dividends, which go to consumers, he
supposes that the consumer price index is as good an index to use
as any.
Number 470
SENATOR RIEGER points out that the concept contained in SB 51 was
recommended in the Governor's Transition Report.
Number 465
CHAIRMAN SHARP wants a clarification on whether SB 51 would set in
statute that inflation-proofing of the fund would continue to be
appropriated by the legislature.
SENATOR RIEGER responds that the wording in the constitutional
amendment basically says: the returns on the permanent fund shall
be deposited in the general fund, unless otherwise provided by law.
It has been argued that language would allow a way to inflation-
proof the fund automatically, and bypass the legislative
appropriation process. He does not think the constitutional
language is clear. The legislature might put it in the front
section anyway. But the idea is to not create a mistaken
impression that there is more money available in any given fiscal
year than there really should be. Senator Rieger thinks as money
continues to get tight, there will be proposals to not inflation-
proof the fund.
Number 443
JIM KELLY, Research & Liaison Officer, Alaska Permanent Fund
Corporation, states the board has not yet discussed SB 51, but
plans to meet on February 24, at which time they will review the
bill. Historically, the board is in favor of any proposal which
would protect the principal of the permanent fund. Mr. Kelly
thinks the board would certainly support the portion of SB 51 which
specifies inflation proofing the fund. However, he does not think
the board would take any position one way or the other on the other
portion of the bill. Mr. Kelly discusses the financial projections
he submitted to the committee and says that the only way the amount
of money the fund earns will be larger is if one, the fund earns
more money, or two, the permanent fund gets larger. The only way
the permanent fund will get larger is if an appropriation is made
to the permanent fund.
Number 410
MR. KELLY states inflation proofing used to be automatic, but that
changed during the Cowper administration. Also, the corporation
likes to use the cpi because it is a number people can understand.
As for using an average balance on which to measure earnings, Mr.
Kelly would just as soon use an average balance of the fiscal year,
rather than the calendar year.
Number 395
CHAIRMAN SHARP asks Mr. Kelly if he is referring to the cost or the
market value of measuring the average balance.
MR. KELLY responds that at this time, it is done in cost.
Number 390
SENATOR RANDY PHILLIPS asks Mr. Kelly if the board is going to look
at SB 51 and make a recommendation.
MR. KELLY says he expects the board to make a recommendation.
SENATOR RANDY PHILLIPS asks Mr. Kelly if the board will make a
formal endorsement.
MR. KELLY responds that they will.
CHAIRMAN SHARP says the committee will hold the bill until next
week to wait for information from the Alaska Permanent Fund
Corporation's board and to get input from all members of the
committee.
Number 343
SENATOR RIEGER comments it would probably be good to switch to
fiscal year from calendar year for measuring earnings. That is
something no one has ever thought of before.
CHAIRMAN SHARP states his gut feeling is to deposit as large an
amount as is possible into the corpus of the fund.
Number 310
CHAIRMAN SHARP adjourns the Senate State Affairs Committee meeting
at 4:56 p.m.
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