04/16/2014 09:00 AM House RULES

             HB 287-APPROVE TESORO ROYALTY OIL SALE                                                                         
                                                                                                                                
9:24:58 AM                                                                                                                    
                                                                                                                                
CHAIR JOHNSON  announced that the  final order of  business would                                                               
be HOUSE BILL  NO. 287, "An Act approving and  ratifying the sale                                                               
of royalty oil  by the State of Alaska to  Tesoro Corporation and                                                               
Tesoro Refining and  Marketing Company LLC; and  providing for an                                                               
effective date."  [Before the committee was CSHB 287(FIN).]                                                                     
                                                                                                                                
9:25:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT moved that the committee adopt Amendment                                                                
1, 28-GH2862\N.2, Nauman, 4/15/14, which read:                                                                                  
                                                                                                                                
     Page 1, line 3, following "refineries":                                                                                  
         Insert "and hydrocarbon processing facilities"                                                                       
                                                                                                                                
     Page 3, line 10, following "refinery":                                                                                   
          Insert "or hydrocarbon processing facility"                                                                         
                                                                                                                                
     Page 3, line 11, following "refinery":                                                                                     
          Insert "or hydrocarbon processing facility"                                                                           
                                                                                                                                
     Page 3, line 12, following "products":                                                                                     
          Insert "or processed hydrocarbon products"                                                                            
                                                                                                                                
     Page 3, line 18, following "refinery":                                                                                     
          Insert "or hydrocarbon processing facility"                                                                           
                                                                                                                                
     Page 4, following line 14:                                                                                                 
     Insert a new paragraph to read:                                                                                            
               "(1)  "processed hydrocarbon products" means                                                                     
     separate  marketable elements,  compounds, or  mixtures                                                                    
     of  oil or  natural gas  in a  liquid or  gaseous form,                                                                    
     including  gasoline,   diesel,  jet  fuel,   gas,  oil,                                                                    
     heating oil, kerosene, ammonia, and urea;"                                                                                 
                                                                                                                                
     Renumber the following paragraphs accordingly.                                                                             
                                                                                                                                
     Page 4, line 18:                                                                                                           
          Delete "or petroleum-based feedstock"                                                                                 
          Insert ", petroleum-based feedstock, or processed                                                                     
     hydrocarbon products"                                                                                                      
                                                                                                                                
CHAIR JOHNSON objected.                                                                                                         
                                                                                                                                
9:25:22 AM                                                                                                                    
                                                                                                                                
TOM   WRIGHT,  Staff,   House  Majority   Office,  Alaska   State                                                               
Legislature,  explained that  Amendment  1  would include  Agrium                                                               
Plant in terms of the tax  credits and any other credits included                                                               
in   the  legislation.      Currently,   Agrium  is   considering                                                               
inspection, assessment,  and possible renovation of  the existing                                                               
facility.   The  aforementioned is  a $200  million project  that                                                               
would  require a  temporary workforce  of about  440 workers  and                                                               
about  $75  million in  direct  labor  income over  the  two-year                                                               
rehab.   The  hydrocarbon processing  facility would  include the                                                               
Agrium  Plant.    Amendment  1 also  changes  the  definition  of                                                               
"processed hydrocarbon products" to include ammonia and urea.                                                                   
                                                                                                                                
9:26:39 AM                                                                                                                    
                                                                                                                                
CHAIR JOHNSON, upon determining no  one wished to testify, closed                                                               
public testimony on HB 287.                                                                                                     
                                                                                                                                
9:26:58 AM                                                                                                                    
                                                                                                                                
CHAIR  JOHNSON removed  his objection.   There  being no  further                                                               
objection, Amendment 1 was adopted.                                                                                             
                                                                                                                                
9:27:18 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE HAWKER  requested that  as this  legislation moves                                                               
forward through  the Senate that  the agencies,  particularly the                                                               
Department  of Revenue  (DOR) thoroughly  review  the tax  credit                                                               
provisions in  order to ensure  they are the most  cost efficient                                                               
and  effective  to  achieve  the desired  outcome.    He  further                                                               
requested the DOR and the  Department of Natural Resources review                                                               
the "qualified  infrastructure expenditure" definition  to ensure                                                               
it's clear,  concise, and  achieves the  desired outcome.   Since                                                               
DOR, according  to the  fiscal note,  doesn't intend  on adopting                                                               
regulations as  a result of  the passage  of HB 287,  the statute                                                               
has to be very clear and understandable.                                                                                        
                                                                                                                                
9:29:13 AM                                                                                                                    
                                                                                                                                
JOE  BALASH,  Commissioner,   Department  of  Natural  Resources,                                                               
ensured  the  committee that  DNR  will  get  DOR to  review  the                                                               
definition.     He  then  thanked  Representative   Chenault  for                                                               
Amendment 1  since DNR, in  principle, supports the  intention as                                                               
it's  important to  grow the  gas-demand side  in the  Cook Inlet                                                               
Basin as it  will drive exploration and development  dollars.  He                                                               
then committed to reviewing the language.                                                                                       
                                                                                                                                
9:30:30 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE OLSON  moved to report CSHB  287(FIN), as amended,                                                               
out  of   committee  with  individual  recommendations   and  the                                                               
forthcoming  fiscal  notes.    There  being  no  objection,  CSHB
(RLS)  was reported  from the  House Rules  Standing Committee                                                               
and is available for calendaring.