Legislature(2003 - 2004)
2004-02-16 House Journal
Full Journal pdf2004-02-16 House Journal Page 2604 HB 485 HOUSE BILL NO. 485 by the House Rules Committee by request of the Governor, entitled: "An Act relating to the powers of the Alaska Energy Authority to make grants and loans and enter into contracts; relating to the bulk fuel revolving loan fund; relating to the Alaska Energy Authority's liability for the provision of technical assistance to rural utilities; relating to the Alaska Energy Authority's investment of the power development fund; repealing the electrical service extension fund; and providing for an effective date." was read the first time and referred to the House Special Committee on Economic Development, International Trade, & Tourism and the Community & Regional Affairs and Finance Committees. The following fiscal note(s) apply: 1. Zero, Dept. of Community & Economic Development 2. Zero, Dept. of Revenue The Governor's transmittal letter dated February 13, 2004, follows: "Dear Speaker Kott: Under the authority of article III, section 18, of the Alaska Constitution, I am transmitting a bill relating to the powers of the Alaska Energy Authority (AEA) to make grants and loans and enter 2004-02-16 House Journal Page 2605 into contracts, relating to the bulk fuel revolving loan fund, relating to the AEA's potential liability for the provision of technical assistance to rural utilities, relating to the AEA's investment of the power development fund, and repealing the electrical service extension fund. Section 1 of the bill would amend AS 42.45.010, establishing the power project fund, to add authorization for the AEA to make loans from the fund for waste energy, energy conservation, energy efficiency, and alternative energy facilities and equipment. Similarly, section 9 of the bill would amend the general powers of the AEA to authorize it to improve, equip, operate, maintain, and enter into contracts for the construction, financing, operation, and maintenance of: bulk fuel, waste energy, energy conservation, energy efficiency, and alternative energy facilities and equipment. The Denali Commission and other federal agencies have provided substantial funding for such projects, and the Legislature has authorized the AEA's receipt and expenditure of the federal money. Section 11 of the bill would repeal AS 42.45.060, which establishes a loan committee to review and approve loans from the power project fund and the rural electrification revolving loan fund. Upon repeal of the loan committee statute, the credit department of the Alaska Industrial Development and Export Authority, which manages the AEA's loan programs, will continue to review applications for loans from those funds in accordance with the applicable regulations. Section 2 of the bill would continue the requirement in present AS 42.45.060(g) for legislative approval of loans for projects in which the cumulative state monetary involvement, through loans, grants, and bonds, is at least $5,000,000 and loans of more than $5,000,000. Sections 1, 3, 4, and 6 contain conforming amendments to reflect the repeal of AS 42.45.060. Sections 5 and 7 of the bill would amend AS 42.45.250, which governs loans from the bulk fuel revolving loan fund, to authorize loans from the fund to "persons," defined with reference to AS 01.10.060 to include corporations, cooperatives, joint ventures, and governmental entities, that generate power or supply the public with fuel used in communities with populations of less than 2,000 people, as well as loans to the communities themselves. Presently, the statute authorizes loans to "private individuals" and to the 2004-02-16 House Journal Page 2606 communities. The Department of Law recently interpreted the term "private individuals" to include only natural persons. Section 12 of the bill makes the amendments retroactive to June 1, 1984, to encompass active loans from the fund to such entities. Section 8 of the bill would amend AS 42.45.400, which requires the AEA to provide technical assistance to rural utilities, to specify that this statutory mandate may not be used as an independent basis for tort liability against the AEA. The AEA would continue to be liable for negligence if it fails to use reasonable care in providing the technical assistance. Section 10 of the bill would amend AS 44.83.386, relating to investment of the power development fund, to provide that the AEA, rather than the Department of Revenue, shall invest the fund. The AEA, with the concurrence of the Department of Revenue, has been investing the fund since 1993. AEA would continue to remit all fund earnings to the general fund. Section 11 of the bill, in addition to repealing AS 42.45.060 as discussed above, repeals AS 42.45.200 (the electrical service extension fund, which is inactive), and repeals AS 42.45.250(l)(1) to remove an unnecessary definition of a term that is not used in the statute. I urge your prompt and favorable action on this measure. Sincerely yours, /s/ Frank H. Murkowski Governor"