03/23/1994 02:41 PM Senate JUD

  CHAIRMAN ROBIN TAYLOR  called the Judiciary Committee meeting to             
 order at 2:41 p.m.   He brought  CSHB 454(FIN)  (APPROP: COST OF              
 OIL/GAS LITIGATION) before the committee as the first order of                
 business.                                                                     
                                                                               
 JIM BALDWIN, Assistant Attorney General, Department of Law,                   
 explained the legislation is the department's FY 94 supplemental              
 appropriation bill for oil and gas litigation.  He noted this has             
 been a recurring event because of the way the Legislature has                 
 funded the department's oil and gas special litigation budget                 
 request unit.  It has been funded on a half-year basis so that the            
 Legislature can, in the middle of the year, review the progress of            
 their litigation and determine whether the course of their                    
 expenditures are keeping pace with the estimates that have been               
 presented during the budget process.                                          
                                                                               
 Mr. Baldwin directed attention to his letter to the committee dated           
 March 18, which outlines cases under litigation.  He then updated             
 the committee on the status of royalty cases, oil and gas tax                 
 cases, and TAPS cases, and responded to questions from the                    
 committee members on those cases.                                             
                                                                               
 Number 225                                                                    
                                                                               
 SENATOR TAYLOR asked if his interpretation was correct that this is           
 merely a supplemental of approximately $18.5 million, which is just           
 half a year's cost, and the actual cost is $36 million.  MR.                  
 BALDWIN responded that $36 million is the amount they have asked              
 for FY 95.  For FY 94 they have asked for approximately $25                   
 million.  He added the department was funded at the rate of 10.3              
 upfront in the budget, and that money has carried them through                
 about December.  Because of the pace of the litigation, which they            
 are preparing for trial, it has forced the department to request              
 the $18.5 million supplemental.  Because the litigation will be               
 going into its trial phase next year, they are asking for a                   
 substantial increase in FY 95.                                                
                                                                               
 Number 270                                                                    
                                                                               
 SENATOR DONLEY asked if the expenses for the Department of Law is             
 for state employees or for contracts let out by the department.               
 MR. BALDWIN responded that the most of the money in the                       
 supplemental is for contracts to outside attorneys.  Within that              
 amount are the costs of expert witnesses and other expenses of the            
 litigation.  SENATOR DONLEY then asked what the department has done           
 to comply with the legislative intent that there be increased                 
 oversight over the contracts.  MR. BALDWIN answered that they added           
 a position in the department last year to provide expertise towards           
 contract administration and management.                                       
 Number 327                                                                    
                                                                               
 There being no further testimony on HB 454, SENATOR TAYLOR asked              
 for the pleasure of the committee.                                            
                                                                               
 SENATOR JACKO moved that CSHB 454(FIN) be passed out of committee             
 with individual recommendations.  Hearing no objection, it was so             
 ordered.