MINUTES SENATE FINANCE COMMITTEE April 29, 1999 9:09 AM TAPES SFC-99 # 114, Side A CALL TO ORDER Co-Chair John Torgerson convened the meeting at approximately 9:09 A.M. PRESENT In addition to Co-chair Torgerson, Senators Gary Wilken, Al Adams, Pete Kelly, Lyda Green and Randy Phillips were present when the meeting was convened. Also Attending: SENATOR DRUE PEARCE; MARK HODGINS, staff to Representative Pete Kott; PATRICK HARMON, staff to Representative Pete Kott; GINNY FAY, Legislative Liaison, Office of the Commissioner, Department of Commerce and Economic Development; ERIC YOULD, ARECA; Attending via Teleconference: DR. EYAL HERZOG from Anchorage; JUDY BRADY, AOGCC from Anchorage; MARK WORESTER, ARCO Alaska from Anchorage; DOUGLAS NEELEY, from Glennallen; SHARON DANIEL, Copper Basin Refuse from Glennallen; DOUG GRIFFIN, from Anchorage; SUMMARY INFORMATION Co-chair Torgerson called the meeting to order at approximately 9:15 a.m. The committee considered SB 29. SENATE BILL NO. 29 "An Act relating to licensure of physicians; and providing for an effective date." CS FOR SENATE BILL NO. 29(L&C) "An Act relating to licensure of physicians; and providing for an effective date." MARK HODGINS, staff to was invited to join the committee. He read the sponsor statement into the record. Senator Adams asked for clarification of the bill. He specifically asked if the bill said one must practice up to three years. Mr. Hodgins responded that it increases the bill to three years for licensure; making it more difficult for foreigners to obtain a medical license in Alaska. Co-chair Torgerson said he would now hear public testimony from Anchorage via teleconference. Dr. EYAL HERZOG testified via teleconference from Anchorage. He read his written testimony of 24 March 1999 into the record. Senator Green MOVED CSSB 29(L&C) and WITHOUT OBJECTION it was REPORTED OUT with individual recommendations and zero fiscal note from the Department of Commerce and Economic Development, Occupational Licensing. The committee took a brief at ease. Co-chair Torgerson reconvened the committee at approximately 9:35 a.m. He called SB 133. SENATE BILL NO. 133 "An Act creating and providing for the Alaska Energy Conservation Commission and transferring to it the powers and duties of the Alaska Public Utilities Commission and the Alaska Oil and Gas Conservation Commission; repealing the Alaska Public Utilities Commission and the Alaska Oil and Gas Conservation Commission; relating to regulation of waste collection and disposal; relating to the powers of the chair of the Alaska Energy Conservation Commission; relating to the appellate procedures of the Alaska Energy Conservation Commission; and providing for an effective date." CS FOR SENATE BILL NO. 133(RES) "An Act creating and providing for the Alaska Energy Conservation Commission and transferring to it certain powers and duties of the Alaska Public Utilities Commission; transferring regulation of pipelines to the Alaska Oil and Gas Conservation Commission; repealing the Alaska Public Utilities Commission; relating to regulation of waste collection and disposal; relating to the powers of the chair of the Alaska Energy Conservation Commission; relating to the appellate procedures of the Alaska Energy Conservation Commission; and providing for an effective date." Senator DRUE PEARCE was invited to join the committee. Senator Wilken advised the committee that he had a conflict of interest regarding this bill. Co-chair Torgerson advised that the Secretary would note the conflict for the record. Senator Pearce continued. She said this bill was an attempt to streamline government by re-structuring the Alaska Public Utilities Commission and the Alaska Oil & Gas Conservation Commission into one commission, the Alaska Energy Conservation Commission. The combination of both agencies will improve the long term function, effectiveness and efficiency of both commissions. The repeal of the APUC and the creation of the Alaska Energy conservation Commission will occur effectively July 1, l999. However, the AOGCC will not merge with the APUC at this time and will require subsequent legislation to do so. The Legislature will authorize LB&A to work on a transition report to be delivered to the Governor and the Legislature on the first day of the second session of the 21st Legislature. The Governor shall appoint one commissioner from each commission to work with LB&A on the transition report. The report shall contain recommendations for re-structuring the two commissions into one. It is the intent of the Legislature to introduce legislation during the second session that would combine the two commissions based on the recommendations of LB&A. She further said that the AOGCC will physically move to the same location as the APUC as soon as possible but not later than July 1, 2000. The two commissions will share record keeping facilities and clerical staff after that time. She explained that the Chairman of the AECC shall be paid an annual salary equal to Range 27, Step C. All other commissioners shall be paid according to their current pay status. (Senator Pearce continued reading her sponsor statement into the record.) She advised the committee that she has submitted seven amendments introduced through Co-chair Torgerson. Co-chair Torgerson said he would rather hear any further testimony regarding this bill before taking up the amendments. Amendment #1 dealt with appeals. The commission, however, would decide whether an appeal could be filed or not. There were other methods for appeals such as through the Court. Senator Adams asked if the panel decision would have to go back to the full commission. Senator Pearce responded only in specific and discreet instances. Amendment #2 would require a management information system. Amendment #3 would set the term for a member to serve. Amendment #4 would establish that the commission could contract for and engage the services of consultants and experts that the commission deemed necessary. Amendment #5 would establish a public advocacy section. This would delineate supervision of staff and also the director duties. Amendment #6 would cover the use of a formal hearing being held before an arbitrator designated for a specific purpose. Amendment #7 would allow the commission to adopt regulations that would establish standards of timeliness for the types of cases that come before the commission. Senator Pearce said she did not feel it wise to set too timely and stringent deadlines. There are always special cases that emergency regulations could be adopted. At this point, Senator Pearce commended the hard work of Pat Carter, her staff. Co-chair Torgerson asked Senator Green to explain her amendment #8. Senator Green said it would remove "relating to regulation of waste collection and disposal". She spoke with the sponsor who was agreeable to the offering of this amendment. Senator Adams asked if communities around the State had the expertise to regulate their own garbage? Senator Green responded. She said it would leave all existing measure regarding garbage as it was according to statute. Senator Pearce said that it in her days in the House there was a lot of time spent on "garbage". She felt local governments should be allowed to deal with their "timeliness" garbage problems on their own. Senator Pearce further explained that she has worked very closely with the Administration regarding this bill. She said she believed that upon the repeal of the commission the fiscal note would go away. She said the matter of the fiscal notes would involve designated receipts. Senator Adams asked if this would include costs of moving the office from one into the other. Senator Pearce said the money for relocation was in SB 134. GINNY FAY, Legislative Liaison, Office of the Commissioner, Department of Commerce and Economic Development was invited to join the committee. She said they basically supported the bill, however the primary concern was maintaining the integrity of the services offered by these two commissions. Other concerns were deregulation of garbage; advocacy of staff; supporting the change in the authority of the chair. However, they do think the Governor should appoint the chair. She referred to HB 183 and noted they had a preference for the language regarding "removal" there. Another issue not quite resolved was the decision of the attorneys to represent the new commission. It was believed that the agency should be treated like other agencies and work with the Attorney General rather than the agency be allowed to contract out to a private attorney. Senator Adams asked if that could be made optional and Ms. Fay said it could be. Senator Pearce was invited back before the committee. She explained that it was not their intent for the commission to hire outside attorneys. It was expected the agency would use the Attorney General. The commissioners had suggested that they be allowed to hire their own legal staff, however this would pose some problems. To further explain, the "removal" language was the same as AOGCC. Ms. Fay said they felt the "removal" language of AOGCC was also better. Senator Phillips returned to the fiscal note. (Tape #114, side A switched to side B at log #590.) Senator Phillips was concerned about a zero note. Senator Pearce responded. Both agencies would need additional staff and the amount of work could not be controlled. One should be happy there was such an increase. She explained the regulatory cost charge and there would not be any momentary cost savings. Senator Phillips further queries. He said it looked to him that two offices were being moved to one location; he associated mergers with savings. If the goal is not being achieved he had other questions. Senator Pearce said it was difficult to guess the changes and savings until the merger actually happened. Co-chair Torgerson asked testimony be kept brief as there were several left to testify. ERIC YOULD, ARECA was invited to join the committee. He said they basically supported the bill. They did question the compatibility of the two organizations. (Co-chair Torgerson passed the gavel to Senator Donley at approximately 10:15 a.m.) Mr. Yould continued. He said there were some very important dockets and did not want to see them diluted. They would also rather see the merged name a little more basic. Another issue they strongly concurred with was the inclusion of a strong management information system. Senator Adams will sponsor the information of proposed amendments being suggested by the testifier (Eric Yould). The secretary logged this in as amendment #9 by Senator Adams. JUDY BRADY, AOGCC testified via teleconference from Anchorage. AOGCC was operating fine and she hoped that the Legislature would deal with the right merger lines regarding APUC. She related a time when the AOGCC was going to be placed in the Department of Natural Resources. She felt the function of the two groups was completely different from each other. She said the sponsor has not dealt with the AOGCC expertise correctly. The combination of the two agencies has not been properly considered. There were other concerns regarding the transfer of the pipeline from APUC to AOGCC without a review by LB&A. She hoped there would be sufficient time for them to comment on this concern specifically during the legislative process. Integrity of the companies was important during the change. Senator Phillips asked that Ms. Brady send her comments in written form to the committee. She responded that it would be preferable for them. Senator Phillips said he would call Ms. Brady and discuss this issue further with her. MARK WORESTER, ARCO Alaska, testified via teleconference from Anchorage. He said his testimony was related to production. ARCO appreciates the recognition in the latest draft of the bill, however, they do not understand nor desire the rushing into the combination of the two commissions without further consideration and study. ARCO is concerned with the transfer to AOGCC. He said a good understanding of the functions of AOGCC and APUC should be considered before any merger. APUC focuses on access and charges for intrastate shipping. ARCO does not feel there has been enough time to study merger of pipeline. TIM COOK, APUC testified via teleconference from Anchorage. He advised he only wanted to observe. STEVE MULDER via teleconference from Anchorage was only available for observation. DOUGLAS NEELEY, testified from Glennallen. He asked Senator Green directly regarding "garbage". Co-chair Torgerson responded that Senator Green's amendment #8 would leave law and statute regarding "garbage" as is. He said they are not in a borough, municipality and need some sort of regulation to protect their area. (There was brief miscellaneous discussion between Mr. Neely and the committee.) SHARON DANIEL, representing Copper Basin Refuse, testified from Glennallen. She said she supported amendment #8 by Senator Green. She felt regulations were needed. Co-chair Torgerson advised he would HOLD the bill in committee. (pause on record) Co-chair Torgerson then called HB 94. HOUSE BILL NO. 94 "An Act removing employees of the Alcoholic Beverage Control Board from the exempt service." PATRICK HARMON, staff to Representative Pete Kott was invited to join the committee. He read a brief sponsor statement into the record. DOUG GRIFFIN testified before the committee via teleconference from Anchorage. Senator Kelly suggested the committee support the bill. Senator Phillips MOVED HB 94 and WITHOUT OBJECTION it was reported out with individual recommendations and zero fiscal note from the Department of Revenue, ABC Board. Co-chair Torgerson reviewed the possible schedule for tomorrow. ADJOURNMENT Co-chair Torgerson adjourned the committee until 9:00 a.m. tomorrow. SFC-99 (9) 04/29/99