03/17/2005 01:30 PM House FINANCE

HOUSE BILL NO. 108                                                                                                            
                                                                                                                                
     An Act relating to the regulation of water and sewer                                                                       
     utilities of political subdivisions that are not in                                                                        
      competition with other water and sewer utilities.                                                                         
                                                                                                                                
Representative   Foster  MOVED  to   ADOPT  work  draft   #24-                                                                  
LS0455\F, Craver,  3/17/05, as the version of  the bill before                                                                  
the Committee.   There being NO OBJECTION, it  was so ordered.                                                                  
                                                                                                                                
SUZANNE   CUNNINGHAM,  STAFF,   REPRESENTATIVE  KEVIN   MEYER,                                                                  
explained   that  the   committee  substitute   includes   the                                                                  
addition  of the two  previously  adopted amendments  creating                                                                  
an "F" version  of the bill.  She added that in  reviewing the                                                                  
draft,  it  was  brought  to  the  Sponsor's  attention  by  a                                                                  
representative  of  the  Municipality   of  Anchorage  that  a                                                                  
technical  change was  needed  under Section  3.   On Page  2,                                                                  
Line  28,  and  on Page  3,  Line  5,  "appointed"  should  be                                                                  
deleted and replaced  with "approved".  The Anchorage  charter                                                                  
does  not allow  for a  member to  be appointed  but they  are                                                                  
allowed to be approved.                                                                                                         
                                                                                                                                
Vice-Chair  Stoltze asked  if approved  would implicitly  mean                                                                  
appointed and approved.  Ms. Cunningham said that it would.                                                                     
                                                                                                                                
Representative  Weyhrauch attempted  to clarify the  statement                                                                  
made  by Vice  Chair Stoltze.   Vice-Chair  Stoltze  commented                                                                  
that it was a semantics concern.                                                                                                
                                                                                                                                
Representative  Holm asked  what  would happen  if the  person                                                                  
was  not approved.   Co-Chair  Meyer  thought  that the  mayor                                                                  
would have  to make  the appointment.   Ms. Cunningham  agreed                                                                  
that  the  mayor  would have  to  make  appointments  to  come                                                                  
before  the assembly  for approval  to fill  the spots on  the                                                                  
board.                                                                                                                          
                                                                                                                                
Representative   Weyhrauch   thought  that   there  would   be                                                                  
members, some  appointed and approved.   Those appointed,  but                                                                  
not  approved,  would not  have  a counting  vote.    Co-Chair                                                                  
Meyer agreed.                                                                                                                   
                                                                                                                                
MARK   PREMO,  (TESTIFIED   VIA   TELECONFERENCE),   ANCHORAGE                                                                  
MUNICIPALITY,   ANCHORAGE,  clarified   that  the  powers   of                                                                  
appointment  rests with the mayor;  the powers of  approval or                                                                  
confirmation  rests  with   the  assembly.    Until  they  are                                                                  
approved  by the  assembly, they  are a  non-voting member  of                                                                  
the board.                                                                                                                      
                                                                                                                                
Representative   Holm  commented  on  the  specifics   of  the                                                                  
board's make-up.   He  asked what would  happen if they  could                                                                  
not get the approval of the members on the board.                                                                               
                                                                                                                                
Representative  Kelly inquired if the Anchorage  utility opted                                                                  
out, would  those people  be laid off  and the expenses  taken                                                                  
from the Regulatory Commission of Alaska (RCA).                                                                                 
                                                                                                                                
KATE GIARD, (TESTIFIED VIA  TELECONFERENCE), CHAIR, REGULATORY                                                                  
COMMISSION  OF ALASKA (RCA),  ANCHORAGE,  explained that  when                                                                  
any utility  becomes unregulated,  their revenues come  out of                                                                  
the pool  of the  revenues calculated  by the  RCA.  The  pool                                                                  
revenues  then  become  smaller.     There  is  not  a  direct                                                                  
correlation  between  an  employee and  any  regular  utility.                                                                  
All revenues would then get smaller.                                                                                            
                                                                                                                                
1:55:54 PM                                                                                                                    
                                                                                                                                
Representative  Kelly  commented  on  a  conflict  within  the                                                                  
Fairbanks utilities  and the mess,  which resulted  from that.                                                                  
He  asked  about   the  "authority"  to  deal   with  such  an                                                                  
oversight.   Co-Chair  Meyer advised  that  there was  concern                                                                  
regarding   the  checks  and   balances  from  the   Anchorage                                                                  
Assembly.  For  some folks, that was not enough  insurance and                                                                  
consequently, the  idea of an authority came into  play, which                                                                  
would oversee rate increases.                                                                                                   
                                                                                                                                
Representative  Kelly requested  future information  regarding                                                                  
the process.                                                                                                                    
                                                                                                                                
Vice-Chair  Stoltze MOVED  to  ADOPT the  proposed changes  on                                                                  
Pages 2  & 3, deleting "appointed"  and inserting  "approved".                                                                  
There being NO OBJECTION, the changes were adopted.                                                                             
                                                                                                                                
Representative  Foster MOVED to report CS HB 108  (FIN) out of                                                                  
Committee  with   individual  recommendations   and  with  the                                                                  
accompanying fiscal  notes.  There being NO OBJECTION,  it was                                                                  
so ordered.                                                                                                                     
                                                                                                                                
CS HB  108 (FIN)  was  reported out  of Committee  with a  "no                                                                  
recommendation"  and with  zero note #1  by the Department  of                                                                  
Environmental Conservation,  fiscal note #2 by  the Department                                                                  
of Commerce,  Community  and Economic  Development and  fiscal                                                                  
note #3 by the Department of Law.                                                                                               
                                                                                                                                
                                                                                                                                
1:59:03 PM