00 SENATE BILL NO. 171 01 "An Act amending the National Petroleum Reserve - Alaska special revenue fund; and 02 establishing the Special Legislative Oil and Gas NPR-A Development Impact Review 03 Committee and defining its powers and duties." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 06 to read: 07 LEGISLATIVE INTENT. It is the intent of the legislature to provide temporary 08 emergency financial assistance to municipalities for the purpose of meeting certain 09 extraordinary operating and capital improvement expenditures necessitated by oil and gas 10 development under 42 U.S.C. 6508. 11 * Sec. 2. AS 24.20 is amended by adding a new section to read: 12 Article 4A. Special Legislative Oil And Gas NPR-A Development Impact Review 13 Committee. 14 Sec. 24.20.580. Special Legislative Oil and Gas NPR-A Development 01 Impact Review Committee. (a) There is established the Special Legislative Oil and 02 Gas NPR-A Development Impact Review Committee. The committee is composed of 03 three members of the senate appointed by the president of the senate and three 04 members of the house of representatives appointed by the speaker of the house. The 05 membership from each house shall include at least one member from the minority 06 caucus of that house. The committee members may be appointed only from the 07 finance committee of each house. The committee shall select its own chair. 08 (b) The committee shall be organized within 15 days after the organization of 09 each legislature. Members serve for the duration of the legislature during which they 10 are appointed. If a committee member is reelected or the member's term of office 11 extends into the next succeeding legislature, the member continues to serve until 12 reappointed or until the member's successor is appointed. 13 (c) The committee may meet during sessions of the legislature and during the 14 interim between sessions at times and places in the state as the committee chair may 15 determine. 16 (d) Members of the committee may receive, for the minimum time required to 17 get to and from meetings and for the period while attending meetings, the same travel 18 and per diem allowances provided by law for members of the legislature when 19 attending sessions. However, members of the committee do not receive per diem for 20 committee meetings during legislative sessions other than the per diem paid to 21 members of the legislature. 22 (e) A majority of the members of the committee appointed from each house 23 (1) constitutes a quorum for the purpose of carrying out the 24 committee's duties under this section; and 25 (2) is necessary to approve and forward to the respective finance 26 committees in each house the committee's recommendations for award of grants. 27 (f) The committee may consult with the Department of Commerce, 28 Community, and Economic Development about grant applications submitted under 29 AS 37.05.530. 30 * Sec. 3. AS 37.05.530(c) is amended to read: 31 (c) The Department of Commerce, Community, and Economic Development 01 shall adopt regulations under which municipalities that are most directly and 02 severely impacted by National Petroleum Reserve - Alaska oil and gas development 03 under 42 U.S.C. 6508 or that demonstrate extraordinary municipal and 04 educational operating expenditures attributable to oil and gas development in the 05 National Petroleum Reserve - Alaska that are beyond the municipality's 06 reasonable capability to meet from growth in receipts from current municipal 07 revenue sources may apply for and be eligible to receive grants to alleviate the impact 08 or expense. The department shall receive the applications and, after conducting 09 a preliminary evaluation of each application against the standard set out in this 10 subsection, within 10 days after the convening of each regular session of the 11 legislature, shall submit to the Special Legislative Oil and Gas NPR-A 12 Development Impact Review Committee (1) a list of all qualifying projects, a 13 recommendation regarding new or additional grants for the projects, and a 14 written justification for each new or additional grant, and (2) a list of all 15 municipalities that have already received grants and written justification for each 16 previous grant. Within 45 days after receipt of the information submitted by the 17 department, the special committee shall forward to the respective finance 18 committees in each house the special committee's recommendations for award of 19 grants under this section. When, under this subsection, the department has been 20 advised of the special committee's recommendations for award of grants, the 21 [THE] department shall notify municipalities of that action [GIVE PRIORITY IN 22 THE ALLOCATION OF GRANTS TO MUNICIPALITIES THAT ARE 23 EXPERIENCING OR WILL EXPERIENCE THE MOST DIRECT OR SEVERE 24 IMPACT FROM OIL AND GAS DEVELOPMENT UNDER 42 U.S.C. 6508 25 WITHIN THE NATIONAL PETROLEUM RESERVE - ALASKA. THE 26 DEPARTMENT SHALL FUND ALL MERITORIOUS GRANT APPLICATIONS 27 OUT OF THE MONEY APPROPRIATED TO IT EACH YEAR. WITHIN 10 DAYS 28 AFTER THE CONVENING OF EACH REGULAR SESSION OF THE 29 LEGISLATURE, THE DEPARTMENT SHALL SUBMIT TO THE LEGISLATURE 30 A LIST OF ALL MUNICIPALITIES THAT HAVE RECEIVED GRANTS, A LIST 31 OF ALL MUNICIPALITIES DETERMINED BY THE DEPARTMENT TO BE 01 ELIGIBLE FOR FURTHER GRANTS, A RECOMMENDATION OF THE 02 AMOUNT OF MONEY TO BE GRANTED FOR THOSE ADDITIONAL 03 APPLICATIONS, AND WRITTEN JUSTIFICATION OF EACH PAST AND 04 POTENTIAL GRANT]. 05 * Sec. 4. AS 37.05.530(d) is repealed and reenacted to read: 06 (d) Grants under this section may be made only upon application by the 07 municipality to the Department of Commerce, Community, and Economic 08 Development. Each grant application must state the intended use for which the grant 09 will be expended. When a municipality 10 (1) applies for a grant under this subsection, the municipality shall also 11 submit to the department a financial report covering the expenditure of any grant made 12 under this section that the municipality has already received; a subsequent grant may 13 not be made without submission of the financial report covering the prior 14 expenditures; and 15 (2) receives a grant under this section, the municipality 16 (A) shall maintain a separate account for each grant received; 17 (B) shall provide for an independent audit of the separate 18 accounts maintained for each grant except that, for a grant that is not more than 19 $250,000, the municipality shall provide for an independent unaudited review 20 of the accounts maintained for the grant; 21 (C) shall submit a copy of the independent audit report or 22 independent review to the department; and 23 (D) may not use the grant substantially for the municipality's 24 basic government operations. 25 * Sec. 5. AS 37.05.530(f) is amended to read: 26 (f) Grants made [FUNDS APPROPRIATED] under [(d) OF] this section 27 may not be used directly or indirectly to reduce current municipal tax rates or to 28 retire existing [FOR THE RETIREMENT OF] municipal debt. 29 * Sec. 6. AS 37.05.530(g) is amended to read: 30 (g) Amounts received by the state under 42 U.S.C. 6508 [AND NOT 31 APPROPRIATED FOR GRANTS TO MUNICIPALITIES UNDER (d) OF THIS 01 SECTION] shall be deposited at the end of each fiscal year as follows: (1) 25 percent 02 to the principal of the Alaska permanent fund; and (2) .5 percent to the public school 03 trust fund (AS 37.14.110). If the amounts awarded for temporary emergency 04 impact grants exceed available funds, the [THE] amounts remaining after the 05 deposits to the Alaska permanent fund, [AND] the public school trust fund, and the 06 amounts appropriated for and approved as temporary emergency impact grants 07 to municipalities shall be allocated pro rata among the fund deposits and grants. 08 Unless the amounts awarded for temporary emergency impact grants exceed 09 available funds, the amounts remaining after the deposits to the Alaska 10 permanent fund, the public school trust fund, and the amounts appropriated for 11 and approved as temporary emergency impact grants to municipalities may be 12 appropriated to the power cost equalization and rural electric capitalization fund 13 (AS 42.45.100). The amounts remaining after any appropriation to the power cost 14 equalization and rural electric capitalization fund shall lapse into the general fund for 15 use by the state for the following facilities and services: planning; construction, 16 maintenance, and operation of essential public facilities; and other necessary public 17 services. 18 * Sec. 7. AS 37.05.530 is amended by adding a new subsection to read: 19 (i) Unless otherwise provided by law, in the Act making the appropriation 20 from the National Petroleum Reserve - Alaska special revenue fund, the unexpended 21 balance of an appropriation made in an Act making an appropriation from that fund 22 lapses on June 30 of the fiscal year for which appropriated. The Department of 23 Commerce, Community, and Economic Development may not otherwise modify the 24 terms of a grant to change the purpose or objective of the grant or the terms and 25 conditions under which the grant may be expended. The provisions of 26 AS 37.25.010(a) and (b) apply to the unexpended balances of appropriations that are 27 lapsed as described in this subsection. Amounts lapsed under this subsection shall 28 revert to the general fund except that, if amounts lapsed are derived from 29 appropriations that had been allocated pro rata among the principal of the Alaska 30 permanent fund, the public school trust fund, and the amounts awarded for temporary 31 emergency impact grants as authorized by (g) of this section, the commissioner of 01 administration shall first apply the lapsing amounts to restore previously prorated 02 allocations to the Alaska permanent fund and the public school trust fund to the 03 amounts due each of those funds as calculated under (g)(1) and (g)(2) of this section.