Legislature(2009 - 2010)HOUSE FINANCE 519
02/24/2010 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB300 || HB302 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 300 | TELECONFERENCED | |
| += | HB 302 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE BILL NO. 300
"An Act making appropriations for the operating and
loan program expenses of state government, for certain
programs, and to capitalize funds; making supplemental
appropriations; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska; and
providing for an effective date."
HOUSE BILL NO. 302
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
1:36:29 PM
Co-Chair Hawker discussed housekeeping. He indicated that
he was expecting a high level overview on what funds the
departments had available for spending at the beginning of
FY2010; what the money was spent on in FY2010, what was
still available, and what the agency was requesting for the
next fiscal year. He requested that a clear, written
definition of an "encumbered expense" be provided at a
later date.
Representative Kelly requested that the speaker tie
together expenditures with statutory law as the committee
examined the various expenditures.
Co-Chair Hawker restated that when asking for an
appropriation item, the committee was requesting a
description of where that appropriation was sourced, and
why it had been originally appropriated.
DANIEL T. SEAMOUNT, JR., COMMISSIONER, ALASKA OIL AND GAS
CONSERVATION COMMISSION, DEPARTMENT OF ADMINISTRATION,
explained that the commission was requesting an addition to
the budget to fund the 3 commissioners, 2 geologists, 5
engineers, 6 inspectors, and support staff that comprised
the commission.
Co-Chair Hawker pointed out to the committee the handout
provided by the Alaska Oil and Gas Conservation Commission
(AOGCC), titled "AOGCC Gas Studies FY2010 Progress and
Future Work" (copy on file). He noted the AOGCC
appropriations that were listed in the "Historical Summary
Gasline Related Appropriations FY2004-FY2010". The
appropriations were located on Page 1, Line 3, and Page 3,
Line 28.
Mr. Seamount continued. He stated the funds would be used
to embark upon studies to mitigate oil losses due to gas
production in the major fields on the North Slope. He
referred to handouts; "AOGCC Gas Studies FY2010 Progress
and Future Work"(copy on file), and "AOGCC Funding
History".
Co-Chair Hawker highlighted the FY2010 expenditure of
$121,985 to the law firm Gaffney, Cline & Associates. He
asked what services they were providing.
Mr. Seamount responded that the commission had a limited
number of engineers to cover the amount of work that needed
in to be done in all of Alaska's oil and gas fields. The
firm was an internationally recognized petroleum consulting
firm, specializing in engineering, geology, and geophysics.
The contract was to assist AOGCC with the review and
analysis of the unit at Point Thomson. The firm was
assisting the commission in ensuring that the models being
used were accurate and could be used to determine the
impacts on oil production via gas production.
CATHY FOERSTER, COMMISSIONER, ALASKA OIL AND GAS
CONSERVATION COMMISSION, DEPARTMENT OF ADMINISTRATION (via
teleconference), added that given the firms worldwide
experience, the findings could validate some of the
assumptions Exxon was making i.e.; how wells would behave
in particular situations, and well spacing. The experience
of the firm would be beneficial in determining whether or
not Exxon was creating a good development plan.
Co-Chair Hawker summarized that the commission was using
the firm as part of the regulatory authority in evaluating
the utility of information made available from industry
when making regulatory decisions. Ms. Forester replied in
the affirmative.
Co-Chair Hawker mentioned that the same consulting firm had
done work for the Department of Natural Resources (DNR),
and The Department of Revenue (DOR), and that other
agencies had used the same consultants to politically
motivate the legislature. He wondered if there was
potential for a conflict of interest.
1:52:26 PM
Ms. Forester felt that there was no conflict of interest
for several reasons: the consultants that the commission
employed were reservoir engineers, geologists, and
geophysicist, and a major consulting firm of this kind was
very careful to avoid conflicts of interest. The firm had
always checked with the commission when they felt a
conflict might be apparent.
Co-Chair Hawker asked if there were written conflict of
interest rules. Mr. Seamount did not believe so.
Co-Chair Hawker warned that in order to maintain
credibility the commission should wary of conflicts of
interest.
1:55:07 PM
Representative Austerman cited the "AOGCC Gas Studies
FY2010 Progress and Future Work" handout. He noted that the
commission received $1.2 million in 2005 and $2.2 million
in 2007. The expenditures for FY2010 were $121,985.00;
$228,363.64 which was currently encumbered. He asked if the
work done in 2010, plus the encumbered amount, totaled what
was remaining from the original $3.4 million, or had all
the $3.4 million had been spent and the request was for an
additional $1.1 million.
Co-Chair Hawker referred to page 3, line 28, as a reference
to the question.
Mr. Seamount replied that the original operating
appropriation was for $2.2 million; $121,985.00 had been
spent and $228.363.64 was encumbered, which left $1,150,900
as the appropriation request.
Co-Chair Hawker clarified that at the end of FY2010, the
AOGCCs funding would lapse. The commission would then seek
reappropriation of the funding. He asked if the commission
would be spending the entire $150 million in the coming
fiscal year.
Mr. Seamount replied that it was uncertain. It appeared
that activity was beginning to happen, and that industry
was becoming more cooperative. More would be spent than in
the past, however, the commission would work to spend as
little as possible. He warned that if the funds were not
appropriated, any gasline project would be delayed.
1:59:49 PM
Ms. Forester added that the commission had a lot of work
left to do. Work that had been completed had taken time
because of the volatile relationship with Exxon. It had
been a challenge to predict the rate at which the Point
Thomson analysis would be completed. Currently, two new
wells were being drilled at Point Thomson which would be
brought on-line as a gas cycling pilot. Data gathered from
drilling, and producing, the wells would need to be
incorporated in the analysis. In Prudhoe Bay more oil was
being produced and mitigation measures were being tested in
preparation for a gas off-take. As the data was collected
the commission needed to be prepared to incorporate the
data into a revision of its studies, and eventually gas
off-take hearing would need to be held for both areas, as
well as a pool rules determination for Point Thompson. The
commission would need contract experts available to testify
at the hearings to ensure that the public had a complete
understanding and so that the record was accurate.
Co-Chair Hawker cited Page 1, Line 3, of the historical
summary. He said that in 2008, the commission received a
reservoir depletion study appropriation for $1.5 million,
none of which had been spent to date. He wondered why the
funding had not been used.
Ms. Forester thought that was a question best answered by
the Department of Administration (DOA), as the department
had been managing the commission's money.
Mr. Seamount interjected that the funds not only included
the Prudhoe Bay and Point Thomson fields, but other oil
fields that would be under consideration for adding to the
pipeline, and other future exploration discoveries.
2:03:53 PM
Co-Chair Hawker asked if the commission exhausted the Point
Thomson money, would the appropriation language of the $1.5
million be sufficient to avoid accusations of interfering
with the forward development of a gas project. Mr. Seamount
did not believe that $1.5 million would be enough for the
commission to do all the work that it needed to do, and
that the total operating, plus capital, might not be
enough. If the commission were to conduct its own study the
request would be significantly higher. He added that the
commission hoped that it would not have to conduct its own
study. Many experts had already begun the study, a lot of
information had been gathered, and it would be time
consuming to go through the process again.
Co-Chair Hawker asked what the constraints were on the $1.5
million that had been sitting unused since 2008. Mr.
Seamount replied that the funds could be used for the Point
Thomson and Prudhoe Bay field studies.
2:05:56 PM
Representative Gara wanted assurances that the field study
process would be successful. He understood that the AOGCCs
main mission was to use oil and gas efficiently. He
wondered if the AOGCC had to stick to the academic rule,
which was the maximum use in theory, or go by the reality
of not putting something in the pipe by a certain time and
killing the project. Mr. Seamount believed that by not
producing the gas, billions of barrels of oil equivalent
would be wasted. He believed that the gas was a resource
that would always be useful.
Representative Gara voiced concern with the ongoing field
studies. He wondered if the point would be reached where
the academic view trumped the reality of the situation. He
hoped that AOGCC could provide a more reliable answer in
the future.
Co-Chair Hawker interjected that he did not understand the
question Representative Gara was attempting to ask. He
requested that the question be put in writing and submitted
to the agency for a formal response.
Representative Gara said that he did not want to find out 8
years from now that the state cannot go ahead with a gas
pipeline because in theory more oil could be drawn from the
field, when in fact, the window for moving ahead with the
gas pipeline was going to pass. Mr. Seamount replied that
there was more energy equivalent in the gas that was left
that in the oil that was left. He felt if the oil could not
be produced out of the production of the gas the project
was a waste.
Representative Gara said he would submit the question in
writing to the commission.
Ms. Forester interjected that the commission was supposed
to prevent the waste of both oil and gas. If to preserve a
half a billion barrels of oil, four billion barrels of
equivalent gas had to be wasted, the plan was a failure.
2:12:44 PM
Co-Chair Hawker summarized that the legislature was being
asked by the commission for continued authority to use the
$1.1 million that would be lapsing soon, and the commission
was hoping to move it forward one year. At the same time,
there were still the other million and a half that had been
appropriated that had yet to be used.
BOB SWENSON, PROJECT MANAGER, ALASKA IN-STATE GAS PIPELINE
COORDINATOR, referred to the pamphlet, "Alaska In-State Gas
Pipeline Project, Budget Summary, February, 18, 2010", copy
on file), which he presented as background information for
further discussion.
Co-Chair Hawker pointed out to the committee that the
appropriation being discussed could be found on Page 4,
Lines 37 and 37 of the historical summary sheet.
Mr. Swenson continued. He shared that Page 5 of the budget
summary outlined the tasks that had been ongoing since
FY2010, and what would be happening in FY2011. Page 6
provided the breakdown of the FY2010 expenditures and what
the balance was as of January 15, 2010. The work completed
to date included the route alternative analysis of the
Parks Richardson Highway routes and associated comparative
pipeline cost estimates, and environmental surveys of the
alternative routes. The initial project description was
required for the initial application for both the right-of-
way and the Environmental Impact Statement (EIS) process.
Another cost was for the commercial group scoping for the
upstream and downstream issues associated with the in-state
gas pipeline. Initial review of the ENSTAR capital cost
estimate was influenced by data that the original bullet-
line partners; Anadarko and ENSTAR had complied. This
included orthoimagery and Light Detection and Ranging
(LIDAR). Money had been encumbered, with the Bureau of Land
Management and the Corps of Engineers, to cover the cost of
the applications. Work that was currently underway, and
would continue into FY2011, was the cost estimations
associated with the pipeline and facilities. There were 16
separate facility scenarios being evaluated. The scenarios
had variations of the configuration of the gas handling
facilities, the compressor stations, and the through-put of
250 million cubic feet to 1 billion cubic feet per day.
All the facility cost estimations and configurations would
be provided at the end of the fiscal year in a complete
report. He stated that the work had just recently begun and
referred to Page 6, which illustrated that as of January
15, 2010, $2,214,968 had been spent, leaving 6 million.
Other work currently being done included; updating of the
pipeline cost estimates, development of facilities,
continuing preparation of a detailed project description,
continued engineering and support of the EIS process and
the right-of-way process, developing the data package for
economic analysis, facility scenarios, commercial group
market analysis, and cost of transport.
2:20:11 PM
Mr. Swenson explained that the $3.9 million in encumbrances
was for the different contracts that were still out. The
personal services, travel, and commodities listed on Page
6, were associated with his office. The request in the
FY2011 budget was for $6.5 million to continue with cost
estimation. Page 13 detailed the activities planned for
2011:
1. Completion of environmental and permitting for United
States Army Corps of Engineers (USACE) and state and
federal right-of-way approvals.
2. Engineering data acquisition for detailed engineering
design of the project.
3. Refinement of Cost of Services estimates and Tariff
modeling.
4. Prepare complete project documentation of in-state
pipeline asset for consideration by private pipeline
developer.
Mr. Swenson asserted that the state did not plan to build
the pipeline. The state planned to reduce the risk
associated with building the pipeline by identifying the
permit ability of the pipeline through the EIS and ROW
process. Additionally, the state would spend money to
sanction the project and sell the acquired data package to
the third-party pipeline company, who would ultimately
strike the deal with producers on the North Slope and the
consumers in Cook Inlet.
Co-Chair Hawker asked about the two components of the
appropriation that was made in the current fiscal year on
Lines 36 and 37, $4,322,000 and $3,967,000, respectively.
The $4,322,000 was a cash appropriation and had been easy
track, the specific intent for the funds had been in the
2009 supplemental budget. The appropriation from 2009
included the provision that any funds left over from a 2008
Department of Natural Resources grant would roll into the
project. It was estimated at budget close-out last year
that the amount would be $2.7 million, however, the
rollover had been approximately $4 million. The funding for
the project had a lapse date of February 28, 2010, which
meant that the funding would expire in 4 days. He said that
$1.8 million of the aggregate had been expended, and all of
the balance appeared as encumbered. If the funding lapsed
in February the project would stop. He expressed concern
that the project had encumbered all the funding it had
received, which meant that it could spend infinitely. He
questioned the use of encumbrance for personnel service
costs and travel.
2:27:23 PM
Mr. Seamount replied that the amount of money that had been
appropriated had not been enough to complete the job. He
added that the personal service and travel costs were
comprised of his wages and those of his assistant through
the end of the year.
LETA SIMONS, DIRECTOR, DIVISION OF SUPPORT SERVICES,
DEPARTMENT OF NATURAL RESOURCES, stated that the
Reimbursable Services Agreement (RSA) from the Office of
the Governor and the Department of Natural Resources had
been looked at for funding for the project manager
position. It had been important that only the actual
expected expenditures and obligations through the end of
February 28 be encumbered. Several offices working together
established a spreadsheet determining that the appropriate
amount would be $6.8 million. The department had advised
the governor's office that and amendment for the RSA should
be included in the appropriation in order to reduce the
total to the $6.8 million. The $3.9 million that appeared
on the budget overview were task orders that were out, and
were legitimate encumbrances. The intent of the amendment
was to reconcile the funds and list the correct encumbrance
number on the RSA.
Co-Chair Hawker asked if the intention was to encumber the
personal service cost and travel. Ms. Simons replied no.
Co-Chair Hawker wondered what was going to happen to the
position of project manager when the appropriation lapsed.
Ms. Simons answered that the actual project manager
position was under DNR and had been budgeted for in FY2010.
The department still had the ability to pay the position
salary.
Co-Chair Hawker understood that the technical complications
would not impede the progress of the project. Ms. Simons
replied yes, and reiterated that the encumbrances in the
overview were legitimate.
Co-Chair Hawker asked about the $$2,493.7 million in
encumbrance found on Line 36. He said that the added
encumbrance numbers on Lines 36 and 37 totaled $6,460.7
million. Ms. Simons replied that the amount was correct.
She explained that the amendment would reduce the total to
$6.8 million total RSA, which included all expenditures and
encumbrances through February 28, 2010.
Co-Chair Hawker expressed unease with the lack of detail
concerning what exactly the encumbrances were for, and if
the encumbrances were in accord with the accounting
policies and laws of the state. Ms. Simons said that she
would provide the information to the committee.
2:33:35 PM
Representative Doogan requested the information as well. He
asked if the amount of money being requested was expected
to fund the completion of a gasline project that would be
compliant with AGIA, and provide gas for South Central
Alaska.
Mr. Swenson replied yes. He expounded that one of the first
issues with the bullet line to Gubik with Anadarko and
ENSTAR, was still a viable option. The stream of gas that
could come from the North Slope was also being examined.
The project was in full compliance with AGIA, and was a
backup plan in case the process fell through. Mr. Swenson
the said that the intent of the work was to craft a permit
package, cost estimates for the entire route, and the cost
of facilities and services. The hope was to pass the entire
project on and then pay back both ENSTAR, and the state for
the expended funds.
Representative Doogan wondered about funding the project
when there were no assurances that it would be economically
successful. Mr. Swenson replied that the package that was
being created included 16 different options, which would
all be vetted for economic viability before going into the
permit process. He believed time was of the essence to
supply natural gas to South Central Alaska.
Representative Doogan voiced apprehension to committing the
funding for a project when it was unknown if corporations
could even afford to participate.
2:40:10 PM
Co-Chair Hawker interjected that the funding that was in
the operating budget currently in effect had been requested
by the Palin Administration, not the existing
administration.
Representative Gara shared that the former in-state gas
pipeline czar stated repeatedly that if a big line were to
be built it would provide cheaper in-state gas for
consumers than a small line. Mr. Seamount said that that
was correct.
Representative Gara expressed frustration with the popular
misconception that in-state gas would be cheap. He believed
that the state needed to reconcile that the big gasline
would not be built in time to alleviate pressing energy
problems in the state. The former oil czar had committed to
evaluating whether or not the in-state gasline made sense.
He wondered why the state was working on acquiring right-
of-way for a pipeline that might lead to more expensive gas
for consumers, rather than working toward the larger
pipeline.
Mr. Swenson pointed out to the committee the if there was a
spur-line in the distance of the pipe, a diameter distance
in cost was associated with it, and travel to the North
Slope considerably increased that cost. He stated that it
would make sense to build an additional line to the Prudhoe
Bay area, because of the area's abundant natural resources.
He expressed belief in AIGA as good plan to get gas to the
Cook Inlet region. However, he stressed the importance that
the state should maximize its resources. If it turned out
that everything worked smoothly with AGIA, the state would
have the initial right-of-way and EIS work done, and if the
package sold to another entity that was getting access to
gas elsewhere, it would make sense to maximize the recovery
of state resources.
2:45:21 PM
Representative Gara understood that the overarching answer
was unknown. He cautioned that people could end up paying
twice as much for gas coming from a small pipeline in
Anchorage and Fairbanks, while the cheaper gas flows right
by them in the big pipeline. He probed the two other
temporary solutions; subsidizing the higher cost production
of Cook Inlet gas until the big line was built, or building
a pipeline from Cook Inlet up to Fairbanks.
Mr. Swenson said the administration was working with
various agencies and organizations to combine efforts going
into the spur routes, as well as the stand alone routes. He
stated that a range of options in various combinations was
being explored. The fiduciary request would fund the
project that would bring all the components concerning the
natural gas pipeline together in order to determine a plan
of action.
Representative Gara asked if ideas were being assessed, and
the subsidizing of Cook Inlet gas would be the cheapest
option, why was a cost analysis being performed.
Mr. Swenson believed that the reason that the permits were
initiated prior to the cost analysis was because of timing.
There was trepidation about the amount of available
resource in Cook Inlet.
2:49:50 PM
Co-Chair Hawker asked if the intent language that
accompanied the appropriation gave the administration
specific directions concerning a smaller gasline.
Mr. Swenson replied no. If a corporation wanted to go ahead
with the small line, the right-of-way and cost estimation
studies could be used for the project.
Co-Chair Hawker clarified that the administration
acknowledged that there was specific legislative intent
that constrained its activities. Mr. Swenson replied in the
affirmative. He added that there was the possibility the
AGIA could fail, which would make the research development
project more important.
Co-Chair Hawker queried the three potential numbers being
examined by the administration of the amount of gas that
could be delivered; 1/4 billion, 1/2 billion, and 1 billion
per day. Mr. Swenson replied that there was a fourth option
of 750 million per day.
Co-Chair Hawker said that under AGIA, anything over 1/2
billion would trigger treble damages. He wondered how it
would be reconciled if the most economical option was in
violation of AGIA. Mr. Swenson clarified that the four
options were a holdover from the Gobik option. Because it
was a small line the economics were inherently challenged.
Co-Chair Hawker understood that the artificial constraint
established by the legislature on the 1/2 billion per day
triggering treble damages might not have been in best
interest of the successful completion of a stand-alone
line. Mr. Swenson reiterated that the stand-alone line was
a back-up plan and might not present any conflict at all.
Co-Chair Hawker thought there could be a problem with
statutory regulations.
2:55:29 PM
Representative Salmon asked how far along the state was in
the development of an in-state gasline. Mr. Swenson
answered that the state was farther along now than in the
past. Because of the decline of resources in Cook Inlet,
the necessity had grown for the examination of the energy
supply within the inlet and the Rail belt region. Access to
development of the natural gas on the North Slope was
imminent. The state's position on AGIA process was farther
along towards the development of North Slope resources than
ever before. He argued that the stand alone pipeline was
also farther along than in the past.
2:57:44 PM
Representative Kelly asked how the scheduling was coming
along. Mr. Swenson replied that scheduling was a big
concern. The administration was examining what the breadth
of schedules might be, but was pushing for fast track
scheduling. One possible option looks at a 2014-2015 time
frame, with access to dry gas. The gas in Prudhoe Bay was
dirtier and would require a significant amount of
conditioning. Incorporating the Prudhoe Bay facility into a
pipeline of this nature would require numerous sea-lifts,
which would extend the completion date. The recent release
of federal regulation from the Environmental Protection
Agency (EPA) on carbon dioxide could also inhibit progress.
Representative Kelly asked if the administrative team was
on schedule. Mr. Swenson replied that they were ahead of
schedule. Cost estimations and facilities design were being
finalized with the initial facilities design completed by
May 1, 2011.
3:02:11 PM
Representative Salmon understood that there were many
components to a project of this size. He asked what the
perfect combination of variables would be needed in order
to guarantee a gasline. Mr. Swenson replied that there were
three important tenants; the cost of the construction of
the pipeline and facilities, identifying the resource on
the North Slope, and working with the producers.
3:05:10 PM
Representative Doogan listed several energy sources in the
state. He hoped that the state was not wasting time and
money on an energy project that would ultimately be a
failure.
Co-Chair Hawker said that a defined route needed to be
picked and pursued.
Mr. Swenson responded that the confusion concerning the
gasline was understandable. He assured the committee that
his mandate was to coordinate the gasline efforts. He noted
that Alaska had more options than most other states for
energy development. He thought that the emphasis should be
on gathering the correct data in order to have informed
conversations about how to move forward in the future.
3:09:54 PM
Representative Kelly stated that the gas line between the
two largest communities in the state could be started soon
and without regret.
Mr. Swenson believed that the Alaska Natural Gas
Development Authority (ANGDA) was looking at that line as
the stand alone Beluga to Fairbanks route, and were
performing economic projections. A pre-build in the
scenario would be difficult to "pencil out on the back of
an envelope", given the market capacity in the Fairbanks
region. He believed economic projections were challenging.
Representative Kelly expressed hopes that there would be
enough money and opportunity to build a successful line. He
expressed frustration that the smaller pipeline was not
moving forward more quickly.
Representative Joule asked whether an in-state gas line was
more economical in the long run than simply importing gas.
Mr. Swenson did not know.
Representative Joule felt that the question would be of
primary concern before spending a considerable amount of
state dollars.
Mr. Swenson replied that the state would make a significant
amount of revenue from the development of the resources.
Long-term prices and infrastructure development should be
considered as well.
3:15:58 PM
Representative Joule thought that in the end, people would
care about the price of the gas, and not who owns the line.
Co-Chair Hawker noted that Page 1, Line 6 of the historical
summary, illustrated that the Department of Labor and
Workforce Development (DOL) was halfway through a multi-
year grant on the Alaska Works Partnership. Pages 5 and 6
list a number of smaller grant awards with the unspent
balances of approximately $1 million.
DAVID STONE, DEPUTY COMMISSIONER, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, referred the committee to Guy Bell
for further details.
Co-Chair Hawker reiterated that the department had received
appropriations in the past and had been a large component
of the gasline strategy. He pointed out to the committee
that DOL had $3 million left of a $6 million appropriation
for the Alaska Pipeline Works Partnership, and numerous
other appropriations winding down, yet the department was
not asking for more funds. He wondered why the legislature
did not need to make any further investment in DOL this
year.
3:20:09 PM
GUY BELL, ASSISTANT COMMISSIONER, DEPARTMENT OF LABOR AND
WORKFORCE DEVELOPMENT, responded regarding statutory basis
mandate in AGIA; that DOL develop a job training program
for Alaskans in pipeline related job opportunities. The
commissioner convened a steering committee comprised of
high-level individuals within the industry including
representatives from the Alyeska Pipeline Company,
TransCanada Alaska, British Petroleum, Exxon, Price
Construction, and a number of private individuals. The
steering committee had been influential in developing the
training program that the department was responsible for
implementing. Strategies had been presented which would
increase opportunities for Alaskans in gasline related
occupations, with an emphasis on the immediate availability
of jobs.
Mr. Bell referred to information detailing the
appropriations that had been received to date, and the
expenditures including; capital appropriations, fiscal year
2009 operating appropriations, and fiscal year 2010
appropriations.
Mr. Bell cited the one-page narrative titled "Gasline
Funding History"(copy on file). In fiscal year 2011, the
department had no requests in the gasline appropriation
section of the budget bill. However, the department had
incorporated in the FY2011 budget request some of the items
that had been included in FY2009 and 2010. That was done by
locating money within the agency budget, and moving general
fund dollars within that budget, to continue the training
program. The re-allocation of the money being was being
reviewed by the House Finance Sub-Committee and the
department was awaiting the results.
Co-Chair Hawker noted the department's core missions had
been internalized into the operating budget, and not viewed
as an increment in addition to the regular operating
budget. Mr. Bell said that transfers had been made within
the operating budget without requesting an increase in
funding. Because the money had been moved from one program
to another they were identified in the budget as
incremental increases.
3:25:05 PM
Co-Chair Hawker said that the department had received $6
million in 2008, and had spent $860,000, with $2 million
encumbered. He wondered why the money had not been spent as
of yet. Mr. Bell replied that the funds had been a capital
appropriation; $3 million in federal authority, and $3
million state funds. The federal dollars were based on a
federal authorization bill that had passed through
congress, but was a contingent appropriation. The pipeline
training center had not yet received any funds. The
department was working with the governor's office in
Washington D.C. and with the congressional delegation, to
work for the release of the funds. Some of the activity at
the training center, specifically the construction of the
central training facility, had been delayed because the
federal funding had not been forthcoming. The center was
operational and there were further plans for a central
training center and housing.
Co-Chair Hawker asked if the unspent balance were the
federal funds that had yet to be received. Mr. Bell
replied no. He stated that the total unspent balance was
the sum of the $3 million plus the encumbered amount of
$2.1 million.
Co-Chair Hawker reworded his question. Was the $3 million
unencumbered balance all federal dollars. Mr. Bell replied
yes.
Co-Chair Hawker queried the probability of the department
receiving the federal $3 million. Mr. Bell said that the
department was hopeful. A problem was the contingent
language surrounding the funds. The department was working
to convince the delegation that the authorization language
needed to be changed.
3:30:10 PM
Co-Chair Hawker asked if a new federal pipeline coordinator
would be helpful. Mr. Bell replied yes.
Co-Chair Hawker discussed housekeeping.
| Document Name | Date/Time | Subjects |
|---|---|---|
| Revenue Gasline Expenditures Summary.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| Law one page.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| Labor Gasline Funding History 02.23.2010.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| Instate Gas- Budget Narrative 2 18 2010.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| Historical Gasline Appropriations Summary 2-22-10.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| FY2011 Gasline Requests 02 24 2010.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| DNR Gasline Overview.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| AOGCC overview 02.24.2010.pdf |
HFIN 2/24/2010 1:30:00 PM |
|
| ANGDA.pdf |
HFIN 2/24/2010 1:30:00 PM |