03/27/2012 09:00 AM Senate FINANCE

SENATE BILL NO. 203                                                                                                           
                                                                                                                                
      "An  Act  establishing   an  energy  assistance   program   in  the                                                       
      Department  of  Revenue  to  issue  an  energy  voucher  to  Alaska                                                       
      permanent   fund  dividend   recipients;   and   relating   to  the                                                       
      analysis  and  recommendation   of an  energy  assistance  program                                                        
      by the governor."                                                                                                         
                                                                                                                                
10:46:37 AM                                                                                                                   
                                                                                                                                
Co-Chair   Hoffman  noted  that  the  meeting  was  the  second  hearing                                                        
for SB 203, regarding an energy assistance program.                                                                             
                                                                                                                                
10:47:00 AM                                                                                                                   
                                                                                                                                
Co-Chair    Stedman    MOVED   to   ADOPT    the   proposed    committee                                                        
substitute   for SB  203, Work  Draft  27-LS1363\D   (Neuman,  3/26/12).                                                        
There being NO OBJETION it was so ordered.                                                                                      
                                                                                                                                
10:47:32 AM                                                                                                                   
                                                                                                                                
Senator   Thomas   provided   a  brief  introduction    to  SB   203.  He                                                       
explained   that  the  CS  retained  major   elements  of  the  original                                                        
bill,  which   incorporated   changes   intended   to  make  the   energy                                                       
voucher   program    simpler   for   field    distributers    and   state                                                       
agencies   to  administer.    The   most  significant    change   is  for                                                       
redeeming   the  energy  voucher.  He  referred   to "Senate   Bill  203:                                                       
Energy Relief for Alaskans" (copy on file).                                                                                     
                                                                                                                                
      Purpose:   To  provide  Alaskans   with  relief  from  the effects                                                        
      of high  energy  costs  and create  a  program  to help  residents                                                        
      deal  with  high  energy   costs  during   the  transition   to  an                                                       
      affordable energy source.                                                                                                 
                                                                                                                                
      Section  1:   The  state   will  send  a voucher   to  every  adult                                                       
      PFD recipient   in the  fall  of  2012.  This can  be  redeemed  at                                                       
      a fuel  distributor   or utility   of your  choice  for  the  value                                                       
      of 250  gallons  of  heating  oil,  350  CCF  of  natural  gas,  or                                                       
      for 1,500 KWH of electricity.                                                                                             
                                                                                                                                
      •    The  recipient   decides  whether   to  use  the voucher   for                                                       
           heating oil or natural gas or electricity, then gives                                                                
           the voucher to the distributor of their choice.  If                                                                  
           the recipient does not already have an account with                                                                  
           the distributor, they open an account.                                                                               
      •    Distributors   send  the  vouchers  to the  state  and  submit                                                       
           claims for payment that list the voucher number, name                                                                
           of voucher owner, the delivery address and other                                                                     
           information.                                                                                                         
      •    Upon  receipt  of  a  claim  from a  distributor,   the  state                                                       
           sends payment to the distributor to be credited to the                                                               
           voucher recipient's account.                                                                                         
      •    The  amount  of  the  state  payment  will  be calculated   by                                                       
           multiplying the quantity of fuel provided by the                                                                     
           voucher, by the distributor's retail price on a                                                                      
           specific date in 2012.                                                                                               
      •    The   credit   may   be   used   only  for   energy   at   the                                                       
           recipient's primary residence in Alaska, and may not                                                                 
           be transferred to another account or paid in cash to                                                                 
           the account holder.                                                                                                  
      •    The  credit  may  be used  to  pay  a recipient's   debt  with                                                       
           the distributor.                                                                                                     
      •    Each voucher may only be used at one distributor.                                                                    
      •    Distributors    can   decide    whether   to   deliver    fuel                                                       
           immediately after they receive a voucher, or to wait                                                                 
           until they receive payment from the state.                                                                           
      •    The  credit  remains  in  the account  until  it  is spent  on                                                       
           energy delivered to the recipient's home.                                                                            
      •    If  the   account  is   closed  before   all  the  credit   is                                                       
           used, the distributor sends the balance back to the                                                                  
           state.                                                                                                               
      •    Vouchers   state  the  recipient's   name,  may  not  be  sold                                                       
           or transferred, and require signature by both the                                                                    
           recipient and the distributor.                                                                                       
      •    Recipients   who  certify  that   they  do not  pay  directly                                                        
           for heating oil, natural gas or electricity at their                                                                 
           primary residence may return their vouchers to the                                                                   
           state and receive either: a replacement voucher in the                                                               
           name of their landlord, or a check for $250.                                                                         
           Individuals may also qualify for $250 if they do not                                                                 
           have a qualified distributor in their community.                                                                     
      •    Participation     by   distributors     is   voluntary,    and                                                       
           interested businesses can apply to be added to the                                                                   
           list of qualified distributors.                                                                                      
      •    The  program  will  be administered   by  the Alaska  Housing                                                        
           Finance Corporation (AHFC).                                                                                          
                                                                                                                                
      Section  2:   The  Governor   must  evaluate  options  and  make  a                                                       
      recommendation   for  the best  energy   relief  program  that  can                                                       
      be instituted in 2013 and beyond.                                                                                         
                                                                                                                                
      This  recommendation   is due  October  1,  2012.   This  analysis                                                        
      must  include   an  evaluation   of   a  "fuel  price   reduction"                                                        
      program,   an  "individual    account"   program,   and  alternate                                                        
      options.                                                                                                                  
                                                                                                                                
      Section 3:  AHFC may adopt emergency regulations and is                                                                   
      exempt from procurement law for the purpose of implementing                                                               
      the energy voucher program rapidly.                                                                                       
                                                                                                                                
      Section 4:  This legislation takes effect immediately.                                                                    
                                                                                                                                
10:50:08 AM                                                                                                                   
AT EASE                                                                                                                         
                                                                                                                                
10:51:40 AM                                                                                                                   
RECONVENED                                                                                                                      
                                                                                                                                
Co-Chair Hoffman turned the gavel to Co-Chair Stedman.