02/02/2017 03:30 PM Senate COMMUNITY & REGIONAL AFFAIRS

         SB  39-MUNI ENERGY IMPROVEMNT ASSESSMNTS/BONDS                                                                     
                                                                                                                              
3:40:14 PM                                                                                                                    
CHAIR BISHOP announced SB 39 to be up for consideration.                                                                        
                                                                                                                                
SENATOR   JOHN   COGHILL,  sponsor   of   SB  39,   Alaska   State                                                              
Legislature, said  the two issues before them  today are important                                                              
to help move the  economy along. SB 39 is the  Commercial Property                                                              
Assessed  Clean Energy  Act that  allows  a municipality  to do  a                                                              
bonding with  the bill  payments attached  to municipal  payments.                                                              
Municipalities  can contract  with  banks under  that bonding  and                                                              
the debt goes  with the real estate  rather than the owner.  It is                                                              
a voluntary program  that was set up for fuel  change-out programs                                                              
in Fairbanks,  but it can  be used all  over Alaska.  He explained                                                              
that  Fairbanks  is  under  pressure  for  exceeding  air  quality                                                              
particulate matter  (PM) 2.5 and getting natural  gas is important                                                              
for that reason.                                                                                                                
                                                                                                                                
He said  that right  now the fuels  cost about  the same,  but the                                                              
penalties for  not complying combined  with the health  advantages                                                              
of natural gas  will make change-outs to natural  gas a necessity.                                                              
This issue was brought  to him by the Alaska Energy  Authority and                                                              
it  is not  a  new idea.  It  went  through the  legislature  last                                                              
session but just didn't get through.                                                                                            
                                                                                                                                
CHAIR BISHOP set SB 39 aside until later in the meeting.                                                                        
         SB  39-MUNI ENERGY IMPROVEMNT ASSESSMNTS/BONDS                                                                     
                                                                                                                                
3:46:06 PM                                                                                                                    
CHAIR BISHOP announced SB 39 to be back up for consideration.                                                                   
                                                                                                                                
3:46:38 PM                                                                                                                    
RYNNIEVA   MOSS,   staff   to  Senator   Coghill,   Alaska   State                                                              
Legislature,  sponsor  of  SB 39,  explained  that  SB 39  has  an                                                              
amendment  that  was prepared  after  consulting  with the  Alaska                                                              
Energy Authority (AEA) and the Fairbanks North Star Borough.                                                                    
                                                                                                                                
SENATOR MACKINNON moved Amendment 1.                                                                                            
                                                                                                                                
                                                 30-LS0330\D.1                                                                  
                                                        Shutts                                                                  
                                                       1/31/17                                                                  
                                                                                                                                
                          AMENDMENT 1                                                                                       
                                                                                                                                
     OFFERED IN THE SENATE                                                                                                      
     TO:  SB 39                                                                                                                 
                                                                                                                                
     Page 7, lines 25 - 30:                                                                                                     
     Delete all material and insert:                                                                                            
          "Sec. 29.55.120. Review required. The record                                                                        
        owner of eligible property shall obtain from an                                                                         
     independent third party the following:                                                                                     
               (1)  for each proposed qualified project,                                                                        
                    (A)  a review of the energy or                                                                              
     emissions baseline conditions, as appropriate; and                                                                         
                    (B)  the projected reduction in energy                                                                      
          costs, energy consumption or demand, or emissions                                                                     
          affecting local air quality, as appropriate; and                                                                      
               (2)  for each completed qualified project,                                                                       
      verification that the qualified project was properly                                                                      
     completed and is operating as intended."                                                                                   
                                                                                                                                
     Page 9, following line 22:                                                                                                 
     Insert a new paragraph to read:                                                                                            
               "(4)  reduction of emissions affecting local                                                                     
     air quality;"                                                                                                              
                                                                                                                                
     Renumber the following paragraphs accordingly.                                                                             
                                                                                                                                
     Page 10, line 16:                                                                                                          
          Delete "decrease energy consumption or demand,                                                                        
     including"                                                                                                                 
          Insert "reduce energy consumption or demand,                                                                          
         energy costs, or emissions affecting local air                                                                         
     quality, and includes"                                                                                                     
                                                                                                                                
CHAIR BISHOP objected for explanation purposes.                                                                                 
                                                                                                                                
MS.  MOSS explained  that  the  amendment  has two  purposes.  The                                                              
first  is to clarify  on page  7, line  25, that  the third  party                                                              
doing an independent  assessment does an evaluation  at the end of                                                              
the project, too.  The other half of this amendment  and the other                                                              
two amendments  are just adds to  the list of  qualifications that                                                              
a project  will  result in  the reduction  of emissions  affecting                                                              
local air  quality. This is  because at  the current price  of oil                                                              
it's quite  possible that  converting from oil  to natural  gas at                                                              
this  time could  result in  little or  no savings,  but it  would                                                              
improve the air quality.                                                                                                        
                                                                                                                                
CHAIR BISHOP removed his objection.                                                                                             
                                                                                                                                
SENATOR  MACKINNON  moved  to  report  SB  39,  as  amended,  from                                                              
committee  with  individual  recommendations   and  attached  zero                                                              
fiscal note.                                                                                                                    
                                                                                                                                
CHAIR BISHOP found  no objection, and CSSB 39(CRA)  moved from the                                                              
Senate Community and Regional Affairs Standing Committee.