04/06/2013 12:30 PM House FINANCE

CS FOR SENATE BILL NO. 23(FIN)                                                                                                
                                                                                                                                
     "An Act  relating to  development project  financing by                                                                    
     the   Alaska   Industrial    Development   and   Export                                                                    
     Authority; relating  to the  dividends from  the Alaska                                                                    
     Industrial    Development    and   Export    Authority;                                                                    
     authorizing  the  Alaska   Industrial  Development  and                                                                    
     Export Authority  to provide financing and  issue bonds                                                                    
     for  a  liquefied  natural gas  production  system  and                                                                    
     natural gas  distribution system; and providing  for an                                                                    
     effective date."                                                                                                           
                                                                                                                                
Co-Chair Stoltze explained  that HB 74 had  been merged with                                                                    
SB 23.                                                                                                                          
                                                                                                                                
8:13:03 PM                                                                                                                    
                                                                                                                                
Representative   Costello  MOVED   to  ADOPT   the  proposed                                                                    
committee substitute  for HCSCSSB  23 (FIN), Work  Draft 28-                                                                    
GS1738\R (Bailey, 4/4/13).                                                                                                      
                                                                                                                                
Co-Chair Stoltze OBJECTED for discussion.                                                                                       
                                                                                                                                
DANIEL GEORGE,  STAFF, REPRESENTATIVE BILL  STOLTZE, pointed                                                                    
to changes in  the bill. He stated that  the CS reintroduced                                                                    
provisions  related  to  Alaska Industrial  Development  and                                                                    
Export  Authority,   (AIDEA)  direct  financing   that  were                                                                    
removed by the House Labor  and Commerce Committee. A change                                                                    
on  page 10,  line 25  stated, "a  natural gas  distribution                                                                    
system  and affiliated  infrastructure in  interior Alaska,"                                                                    
where the "interior Alaska" portion was added.                                                                                  
                                                                                                                                
Co-Chair Stoltze WITHDREW his OBJECTION.                                                                                        
                                                                                                                                
There being NO OBJECTION, it was so ordered.                                                                                    
                                                                                                                                
Representative Thompson MOVED a  technical amendment on page                                                                    
10, line 25 to capitalize  the word "Interior." He commented                                                                    
that the  word "interior"  in the bill  referred to  a place                                                                    
and therefore required capitalization.                                                                                          
                                                                                                                                
Representative    Kawasaki    objected.   He    asked    for                                                                    
clarification on  the word interior  and its meaning  in the                                                                    
bill. Representative  Thompson explained that  the lowercase                                                                    
word did not adequately reflect  Interior Alaska as a place.                                                                    
He posed  that the word  interior might refer to  the inside                                                                    
of his home  rather than a place in our  state. The Interior                                                                    
of  Alaska  included  the North  Slope,  Fairbanks  and  the                                                                    
Fairbanks North Star Borough.                                                                                                   
                                                                                                                                
Co-Chair Stoltze  added that the previous  committee removed                                                                    
the word  interior. The  House Finance  Committee reinserted                                                                    
the word,  which asserted the  original intent of  the bill.                                                                    
He  added that  Southcentral  was  routinely capitalized  in                                                                    
legislation.                                                                                                                    
                                                                                                                                
Representative Thompson  relayed that  the interior  area of                                                                    
Alaska was also characterized as "middle earth."                                                                                
                                                                                                                                
Representative Wilson  added that  Interior referred  to the                                                                    
Fairbanks area and surrounding communities.                                                                                     
                                                                                                                                
Representative Kawasaki WITHDREW his objection.                                                                                 
                                                                                                                                
Representative Edgmon clarified  that Interior also included                                                                    
the  rural  surrounding  areas. Co-Chair  Stoltze  concurred                                                                    
that Interior was an inclusive  term for the central portion                                                                    
of Alaska and the surrounding areas.                                                                                            
                                                                                                                                
8:17:44 PM                                                                                                                    
                                                                                                                                
Representative Gara noted that  the Interior did not include                                                                    
Southcentral.   Co-Chair  Stoltze   asked  for   information                                                                    
related to the term from the sponsor.                                                                                           
                                                                                                                                
TED   LEONARD,   EXECUTIVE   DIRECTOR,   ALASKA   INDUSTRIAL                                                                    
DEVELOPMENT  AND EXPORT  AUTHORITY,  (AIDEA), DEPARTMENT  OF                                                                    
COMMERCE,  COMMUNITY AND  ECONOMIC DEVELOPMENT,  agreed with                                                                    
the  assessment stated  with  the  Interior Delegation  that                                                                    
Interior encompassed North Star  Borough, parts of the North                                                                    
Slope, Northwest  Arctic Borough  and the inclusive  area in                                                                    
the middle of Alaska.                                                                                                           
                                                                                                                                
There being NO  OBJECTION, it was so  ordered. The technical                                                                    
amendment capitalizing the word "Interior" was ADOPTED.                                                                         
                                                                                                                                
Mr.  Leonard  did  not  have  additional  comments  for  the                                                                    
committee. He was available for questions.                                                                                      
                                                                                                                                
8:20:11 PM                                                                                                                    
                                                                                                                                
Representative  Costello  discussed  the  two  "replacement"                                                                    
fiscal notes.  The first note  from Department  of Commerce,                                                                    
Community  and  Economic  Development  (DCCED)  showed  $950                                                                    
thousand for FY  14 total operating cost.  The second fiscal                                                                    
note  from Fund  Capitalization  showed $125  million FY  14                                                                    
operating cost.                                                                                                                 
                                                                                                                                
Co-Chair Austerman pointed to the  new DCCED fiscal note and                                                                    
the  $200  thousand increase  in  the  replacement note.  He                                                                    
asked about  the change between  the two notes.  Mr. Leonard                                                                    
replied that the  $950 thousand was the combined  HB 74 plus                                                                    
the  Interior gas  plan. He  pointed out  the $200  thousand                                                                    
cost  for   regulations  plus  $750  thousand   for  project                                                                    
management.                                                                                                                     
                                                                                                                                
Representative  Costello  revisited  the  fiscal  notes  and                                                                    
discussed the costs in out-years.  She stated that the DCCED                                                                    
note showed an operating expenditure  of $650 thousand in FY                                                                    
15, $450 thousand in FY 16,  $350 thousand in FY 17 and $150                                                                    
thousand for both FY 18 and FY 19.                                                                                              
                                                                                                                                
Co-Chair Stoltze noted that HB  74 received public testimony                                                                    
prior to merging the legislation with SB 23.                                                                                    
                                                                                                                                
8:24:13 PM                                                                                                                    
                                                                                                                                
Representative Wilson  MOVED to REPORT HCS  CSSB 23(FIN) out                                                                    
of  committee   with  individual  recommendations   and  the                                                                    
accompanying fiscal notes. There  being NO OBJECTION, it was                                                                    
so ordered.                                                                                                                     
                                                                                                                                
HCS CSSB  23(FIN) was REPORTED  out of committee with  a "do                                                                    
pass" recommendation  and with  two new fiscal  impact notes                                                                    
from  the Department  of  Commerce,  Community and  Economic                                                                    
Development.                                                                                                                    
                                                                                                                                
Co-Chair  Stoltze discussed  the schedule  for the  upcoming                                                                    
days.                                                                                                                           
                                                                                                                                
Representative  Kawasaki  asked  who would  present  to  the                                                                    
committee the  following day. Co-Chair Stoltze  replied that                                                                    
the  administration and  consultants  would  present to  the                                                                    
committee on Sunday.