Legislature(2019 - 2020)BUTROVICH 205
03/09/2020 03:30 PM Senate RESOURCES
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| Audio | Topic |
|---|---|
| Start | |
| SB193 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 189 | TELECONFERENCED | |
| *+ | SB 193 | TELECONFERENCED | |
| + | TELECONFERENCED |
SB 193-ELECTRIC UTILITY LIABILITY
3:31:17 PM
VICE-CHAIR COGHILL announced that the only order of business
would be SENATE BILL NO. 193, "An Act relating to liability of
an electric utility for contact between vegetation and the
utility's facilities; and relating to vegetation management
plans."
He noted that he is the sponsor of Senate Bill 193 (SB 193).
3:32:27 PM
CHRISTIAN ENGLISH, Intern, Senator John Coghill, Alaska State
Legislature, Juneau, Alaska, read the following sponsor
statement for SB 193:
This Senate Bill further defines the responsibility of
a utility providing electrical service to the public,
and the damages in which they can be held liable for.
Senate Bill 193 makes clear in statute that a utility
offering electrical service to the public may not be
held liable for property damage, death, or personal
injury resulting from contact between vegetation and
the utility's facilities, unless the vegetation is
located entirely within the boundaries of the
utility's right-of-way or if the utility fails to have
a written vegetation management plan or fails to
comply with that plan.
To specify, an electric utility is not to be held
liable for damages that come about as a result of
natural events moving vegetation into a facility's
right-of-way. Nor is a utility to be held liable for
damages caused by an unaffiliated person or party
recklessly endangering a facility by causing
vegetation to fall into its right-of-way.
SB 193 protects responsible electric utilities from
being held liable for the cost of damages caused by
vegetation that they either cannot control or are not
permitted to maintain, consequently this also protects
Alaska electric customers from having to bear the
brunt of those costs through their rates in a state
where electric utility service costs are already so
high.
3:33:01 PM
SENATOR KAWASAKI joined the committee meeting.
VICE-CHAIR COGHILL asked for a sectional analysis on SB 193.
3:34:50 PM
RYNNIEVA MOSS, Staff, Senator John Coghill, Alaska State
Legislature, Juneau, Alaska, noted that the language in Alaska
Statute (AS) 09.65.085 regarding electrical utility liability in
SB 193 is language passed in a 1997 tort reform bill sponsored
by Representative Porter. The reform bill came about when the
courts were looking at utilities as providing a product instead
of a service. The reform bill released electrical utilities from
strict liability where providing a product meant utilities were
at fault no matter what. The strict liability language in the
reform bill protected utilities as providers of a service rather
than a product.
MS. MOSS detailed that section 1 of the bill adds a new
paragraph (2) to AS 09.65.085(a). It provides that if damage
starts entirely within the right-of-way then the utility would
be responsible. However, should a neighboring property drop a
tree, for instance, on a line and start a fire, that would be
the responsibility of the property owner who owned the tree that
fell into the right-of-way.
She said section 1 also includes caveats to [AS 09.65.085(a)(2)]
in subparagraphs (A) and (B) that hold the utility responsible
if it does not write a vegetation management plan or comply to
the plan.
3:36:37 PM
VICE-CHAIR COGHILL asked about section 2 in the bill.
MS. MOSS explained that section 2 adds "written vegetation
management plan or policy" [in new subsection (c) to AS
09.65.085].
VICE-CHAIR COGHILL added that the written vegetation plan is a
requirement.
MS. MOSS answered yes.
VICE-CHAIR COGHILL noted that the requirement for a written
plan, that matches this liability, has not been in statute until
now.
MS. MOSS pointed out that the bill still has language from the
1997 reform bill that a utility is not precluded from liability
for civil damages that are the result of intentional, reckless,
or negligent acts or omissions, [AS 09.65.085(b)].
3:37:16 PM
VICE-CHAIR COGHILL opened public testimony.
He said the utilities probably will want to speak to SB 193. He
explained that based on the recent fires in California, the
legislation addresses both utility and individual
responsibility. In Alaska, trees are big enough to occasionally
fall across a right-of-way into powerlines. The bill addresses
responsibility questions based on a vegetation management plan
and landowners who have trees along right-of-ways.
SENATOR KIEHL asked what needs to be in a vegetation management
plan.
MS. MOSS replied each utility has a vegetation management plan.
In Fairbanks, Golden Valley Electric Association (GVEA) has a
monthly clearing schedule in its management plan for property
owner areas and powerline rights-of-way.
She noted that GVEA removed cottonwood trees on her property
that could have fallen on powerlines. Property owners that do
not allow utilities to remove trees that are in danger of
falling into a right-of-way is an issue. Utilities have no right
to cut down a tree that is not in their right-of-way.
3:39:49 PM
TRAVIS MILLION, Chief Executive Officer, Copper Valley Electric
Association, Glennallen, Alaska, testified in support of SB 193.
He noted that the right-of-way management plan that Copper
Valley Electric Association (CVEA) has specifically calls out
time frames to maintain its rights-of-way.
He detailed that CVEA separates its management plan for
transmission lines into northern and southern districts. Valdez,
located in the southern district, gets more rain and requires
right-of-way maintenance every 5 to 7 years, whereas the
northern district requires right-of-way maintenance every 7 to
10 years. Distribution lines right-of-way maintenance is based
on growth patterns and rotates from 5 to 10 years.
SENATOR BISHOP asked what CVEA's clearing limits are.
MR. MILLION answered that clearing limits are based on whether
the lines are distribution or transmission but about 95 percent
of CVEA's distribution lines have a 30-foot right-of-way which
means 15 feet from the pole on either side. Transmission lines
have a 100-foot right-of-way, so 50 feet from the center line
outwards on either side.
VICE-CHAIR COGHILL offered his understanding that any tree that
is over 60 feet could be an issue if it is on the edge of the
right-of-way.
MR. MILLION answered correct.
3:41:49 PM
VICE-CHAIR COGHILL noted that having trees over 60-feet tall
near the right-of-way is not uncommon.
He asked Mr. Million to provide his testimony specifically on SB
193.
MR. MILLION detailed that CVEA is an electrically isolated
electric cooperative serving 3,800 members in Interior Alaska.
CVEA, which is headquartered in Glennallen, serves a large
service area that encompasses Valdez to the south, 160 miles
north of Valdez, and 100 miles east and west of Valdez.
He said SB 193 will clarify in statute that holding an electric
utility liable for property damage, death, or personal injury
resulting from the contact of vegetation outside of a utility's
right-of-way and utility infrastructure may not occur. The
legislation protects ratepayers which in most cases in Alaska
are the member-owners of the electric cooperative or citizens of
the municipality.
MR. MILLION noted that even prior to the news of the California
wildfires, CVEA has been very aggressive over the last five
years to reestablish and maintain the utility's rights-of-way.
Not only is it CVEA's responsibility as the stewards of the
utility rights-of-way, it is also the right thing to do.
He said maintaining rights-of-way in Alaska can be very
difficult work. In places like Southeast and even in Valdez, the
trees and vegetation grow back quickly. CVEA's vegetation
management plan describes the clearing width of rights-of-way
for both distribution and transmission assets. The methods used
to clear rights-of-way include both hand clearing and the use of
mechanical equipment such as Fecon mowers and vertical clearing
machines. CVEA also reviews the rotation and frequency for
clearing feeder lines in any given year. CVEA maintains a 100-
foot-wide clearing for its 106-mile-long transmission line from
Glennallen to Valdez that runs through some of the most rugged
terrain in Alaska. CVEA reestablished nearly the entire length
of the line since 2016.
MR. MILLION stated that if a tree from outside the right-of-way
were to come in contact with a CVEA line and cause a fire, it
does not seem right for the utility that has an established plan
and is doing its due diligence to maintain its rights-of-way to
be held liable for property damage caused by that tree, even if
the utility does not have the legal right to remove it.
He said unlike many utilities in the Lower 48, remotely isolated
utilities run the risk of having to shut down their power system
if a lawsuit were to bankrupt the utility. In most cases, there
is not another option to receive electrical services.
Essentially, a utility liability lawsuit would ultimately hurt
the member-owners, not the shareholders like a for-profit
electrical utility. Without the changes to Alaska statute that
SB 193 introduces, there are very few cost-effective options for
the utilities to mitigate their liability risks. Again, CVEA
must pass any cost burden on to its member-owners.
MR. MILLION said increasingly warm summers in the Interior
brings drier conditions, increased numbers of Spruce beetle
killed trees, and higher risk of wildfires. Passing SB 193 will
protect the Alaska electric utilities and their member-owners.
3:45:13 PM
SENATOR KAWASAKI asked how a utility works with a property owner
who has a large tree at the edge of the right-of-way.
MR. MILLION answered that CVEA handles right-of-way issues with
trees on a case-by-case basis. CVEA first identifies who the
property owner is and then discusses whether they would be
willing to allow CVEA to remove the tree. In most cases, CVEA
member-owners are willing to allow clearing. However, there are
a few people who really enjoy their trees and do not want the
trees cut down for any reason.
VICE-CHAIR COGHILL noted that he topped a tree near his home to
avoid interfering with a powerline right-of-way.
3:46:44 PM
MICHAEL ROVITO, Deputy Director, Alaska Power Association,
Palmer, Alaska, testified in support of SB 193. He noted that
the Alaska Power Association (APA) is a statewide trade
association representing the electric utilities in Alaska.
He said SB 193 will clarify in statute that holding an electric
utility liable for property damage, death, or personal injury
resulting from the contact of vegetation outside of a utility's
right-of-way and utility infrastructure may not occur. SB 193
will protect Alaska's electric ratepayers from shouldering costs
related to damage caused by vegetation outside of a utility's
control. SB 193 also requires utilities to create and follow
written vegetation management plans for the easements and
rights-of-way that they do control.
MR. ROVITO explained that Alaska is largely a public-power state
meaning there are no outside investors to absorb the cost of
lawsuits filed against the utility. It is the ratepayers who
bear the cost. SB 193 will protect ratepayers from rate
increases brought on by costly litigation related to damage
caused by vegetation a utility cannot control.
He reiterated that electric utilities do not have legal access
to vegetation located on land located outside of the utility's
right-of-way. Not having access creates a situation where trees
or other vegetation outside the right-of-way, but large enough
to fall inside the right-of-way and contact powerlines or other
utility infrastructure, pose an uncontrollable risk. Electric
utilities should not bear the burden of defending against
lawsuits over wildfires or other damage caused by vegetation
beyond those utilities' easements and rights-of-way. Electric
utilities should have protection when they develop and carry out
vegetation management plans within their easements and rights-
of-way.
He said the reforms in SB 193 will protect Alaska consumers from
ultimately having to pay the costs through electric rates in
cases where fires begin on property not under a utility's
control. Electric utilities outside of Alaska have run into
serious financial difficulties in such instances, and Alaska is
starting to see some litigation.
He stated that without the immediate changes made through SB
193, the only alternatives for utilities is to consider the
costly options of either burying electric lines or acquiring
easements to eliminate the possibility that vegetation from
outside of the right-of-way ever contacts powerlines. The
easement acquisition option is also environmentally and
logistically unfeasible in most areas.
He concluded that as the cause of wildfires increases due to
hotter and drier summers, invasive insects, and longer growing
seasons, it is imperative that SB 193 pass to protect Alaska's
electric utilities and their ratepayers.
3:50:03 PM
SENATOR KIEHL noted the use of the word "entirely" in the
bill regarding the base of a tree being entirely outside of
the right-of-way. He asked what occurs if a tree grows and
leans above the right-of-way.
3:50:46 PM
JOHN LEMAN, General Counsel, Alaska Power Association,
Anchorage, Alaska, testified in support of SB 193. He conceded
that trees do not generally observe the property lines so there
could be a situation where a tree hangs over. He said he does
not believe that Alaska law would let a utility cut down a tree
that is growing from an adjacent parcel of land. An electrical
utility may have the ability to do some trimming to the extent
that the tree is growing into the right-of-way. However,
"entirely" is in the bill because vegetation that is straddling
the right-of-way boundary complicates what a utility must do in
the interest of powerline protection.
SENATOR KIEHL noted that one of the things associated with the
California fires was powerlines catching fire due to strong
winds blowing material into them. He asked if the airborne
branch is entirely within the utility right-of-way or is the
base of the tree.
MR. LEMAN answered that the way the bill reads is that the
airborne branch would be vegetation outside of the right-of-way.
He reiterated that there is nothing the utility can do if the
branch from a tree that was outside of the right-of-way blows
off in a storm.
VICE-CHAIR COGHILL noted that his experience is that electrical
utilities will work with homeowners, especially if they know
they have a liability.
3:53:04 PM
MR. LEMAN agreed that a utility has a lot of incentive to try to
keep any tree, either inside or outside the right-of-way, from
contacting their powerlines. In addition to fire prevention, a
utility wants to maintain system integrity, not have angry
customers who do not have power, and avoid the cost of repairing
powerlines in remote areas. Alaska's electric utilities are very
willing to take out a tree that is over the right-of-way line if
the landowner will let them. When they are already in the area
clearing the easement or right-of-way, the cost is minimal.
SENATOR KIEHL referred to the provision on page 2, line 6 that
does not shield a utility from civil damages that are the result
of an intentional, reckless, or negligent act. He said he
doesn't believe that applies to this, but he wonders why the
legislature would want to provide a shield for even an
intentional or negligent act.
MR. LEMAN answered that the purpose of the bill is to preclude
someone from saying that a utility was negligent if a tree
outside the right-of-way caused a fire. He said he is having
trouble imagining saying someone intentionally caused a fire
from outside the right-of-way. The intent is to avoid the
negligence argument. There have been utilities in the Lower 48
that had juries say a utility was negligent because a tree
outside the right-of-way fell on the powerline. He said this is
designed to protect against that.
He added that, regarding vegetation within the right-of-way
itself, the question is going to be whether the utility had a
written vegetation management plan and whether they
substantially complied with it. That is what is going to
determine liability for vegetation inside the right-of-way, he
said.
He summarized that the section in the bill sets the rules of
liability in a clearer way than just a common law negligence
standard.
3:56:07 PM
MS. MOSS said she believes Senator Kiehl is correct; the bill is
written incorrectly. As written, precluding liability applies to
paragraph (A)(1) and it should preclude liability for both
paragraph (A) and paragraph (B).
VICE-CHAIR COGHILL said his office will have to ask the drafter
for assistance.
SENATOR BISHOP commented that the intent is to protect
ratepayers from not paying for something that they are not
responsible for.
VICE-CHAIR COGHILL said the intent is to draw a clean line
between when the utility is responsible and liable and when the
property owner is responsible and liable.
MS. MOSS suggested that homeowners make sure they understand
what their liability is under their homeowner's insurance
policy. She noted that most utilities carry up to $2 million in
liability insurance for right-of-way damages.
SENATOR BISHOP remarked that GVEA in Fairbanks would rather send
a bucket truck and two guys to take down a tree then to send two
line-trucks in the dead of winter to put in a new pole and new
service.
3:58:23 PM
SENATOR GIESSEL agreed and noted that Chugach Electric
Association in Anchorage would also be happy to help remove a
tree.
VICE-CHAIR COGHILL remarked that the utilities have worked on
vegetation management, but liability becomes a key question due
to the fires in California.
MR. LEMAN offered his understanding that most homeowner
insurance would cover damage to homes and businesses from
wildfire.
He maintained that line 6 on page 2 is written correctly. He
said he would be concerned about rewriting subsection (b) and
reimposing a negligence standard for trees outside the right-of-
way when the bill is trying to say there is not going to be
liability in that circumstance. He added that liability for
vegetation within the right-of-way is going to be determined by
the vegetation management plan.
VICE-CHAIR COGHILL said the committee will look at subsection
(b) again to make sure the liability ladder of responsibility is
properly in context. He suggested that the legal drafter may
provide an explanation.
4:00:46 PM
VICE-CHAIR COGHILL announced that public testimony will remain
open for SB 193.
He commented that transmission issues in Alaska and the Lower 48
are getting tougher.
4:01:19 PM
VICE-CHAIR COGHILL held SB 193 in committee.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 189 Written Testimony Alaska Trollers Assoc. 03.06.2020.pdf |
SRES 3/9/2020 3:30:00 PM |
SB 189 |
| SB 189 Support Document - ADFG Response 3.4.20.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/18/2020 3:30:00 PM |
SB 189 |
| SB 189 Support Document - Stocking FAQ 02.29.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/18/2020 3:30:00 PM |
SB 189 |
| SB 189 Support Document - Surcharge Revenue Breakdown revised- 03.04.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/18/2020 3:30:00 PM |
SB 189 |
| SB 189 Draft Amendment v. A.1.pdf |
SRES 3/9/2020 3:30:00 PM |
SB 189 |
| SB 193 v. U.PDF |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 193 Sponsor Statement v. U.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 193 White Paper APA 02.25.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 193 Written Testimony APA 02.25.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 193 Written Testimony Chugach Electric Assoc 02.26.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 193 Fiscal Note LAW-CIV 03.06.2020.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/16/2020 3:30:00 PM |
SB 193 |
| SB 189 ADF&G Followup answers to committee questions.pdf |
SRES 3/9/2020 3:30:00 PM SRES 3/18/2020 3:30:00 PM |
SB 189 |