Legislature(1993 - 1994)

1993-02-19 Senate Journal

Full Journal pdf

1993-02-19                     Senate Journal                      Page 0412
SB 124                                                                       
SENATE BILL NO. 124 by the Senate Rules Committee by request                   
of the Governor, entitled:                                                     
"An Act relating to the powers and finances of the                            
Alaska Energy Authority; and providing for an                                  
effective date."                                                               
was read the first time and referred to the Labor and Commerce,                
Judiciary and Finance Committees.                                              
Zero fiscal note published today from Department of Commerce and               
Economic Development.                                                          
Governor's transmittal letter dated February 19:                               
Dear Mr. President:                                                            
Under the authority of art. III, sec. 18, of the Alaska Constitution,          
I am transmitting a bill relating to the financial reorganization of the       
Alaska Energy Authority.  This bill reorganizes most of the loan               
portfolios, funds, and revenue managed by the Alaska Energy                    
Authority into a single energy authority revolving fund.  The                  
substantive statutory language for certain existing funds is retained          
or modified to provide direction to the authority in carrying out              
future loan programs or investments.  Several existing funds are               
renamed as accounts in the new revolving fund as follows:                      

1993-02-19                     Senate Journal                      Page 0413
SB 124                                                                       
-- "power project fund" (AS44.83.170)                                         
becomes "energy project loan account,"                                         
-- "power development fund" (AS44.83.382)                                     
becomes "energy development account", and                                      
-- "power development revolving loan fund"                                    
(AS44.83.500) becomes "energy development loan                                 
The bulk fuel revolving loan fund (AS44.83.600 - 44.83.650) and                
the rural electrification revolving loan fund (AS44.83.361 -                   
44.83.363) are repealed since their purposes become consolidated in            
the new energy project loan account.  The electrical service                   
extension fund (AS44.83.370) and the power cost equalization fund              
(AS44.83.162) would still remain separate funds.                               
It is the intent of this bill to consolidate revenue streams of the            
authority into the new energy authority revolving fund and thus to             
provide a more predictable non-general-fund source of financing for            
energy projects and other programs, including construction of                  
electrical transmission interties from Anchorage to the Kenai                  
Peninsula and from Healy to Fairbanks.  It is anticipated that in the          
future the energy authority revolving fund will allow for funding and          
financing of energy projects such as interties for the Copper Valley           
region and Southeast Alaska.  The fund further allows and plans for            
power cost equalization (PCE) money to be appropriated from the                
fund so that by the year 2001 no appropriations will be necessary              
from the general fund to sustain PCE at the level of $17 million per           
year through the year 2013.                                                    
It is the intent of this legislation that the authority manage the             
revolving fund in such a manner as to allow the legislature to                 
appropriate from the fund for PCE $2,429,000 in fiscal year 1995,              
$4,857,000 in fiscal year 1996, $7,286,000 in fiscal year 1997,                
$9,714,000 in fiscal year 1998, $12,143,000 in fiscal year 1999,               
$14,571,000 in fiscal year 2000, and $17,000,000 in fiscal years               
2001 through 2013, while allowing the authority to provide, from the           
revolving fund, a no-interest loan of $90,000,000 for railbelt interties,      
and no-interest loans of $40,000,000 each for interties or other               
energy projects in the Copper Valley region and Southeast Alaska.              

1993-02-19                     Senate Journal                      Page 0414
SB 124                                                                       
For interties that meet the criteria of connecting two or more utility         
systems that were not previously linked or that provide a second               
circuit to improve reliability and transfer capability, this legislation       
allows the authority to issue loans up to a 50-year term at no                 
I urge your favorable consideration of this important legislation.             
      Walter J. Hickel