04/28/2004 09:06 AM Senate FIN

                                                                                                                                
     SENATE BILL NO. 392                                                                                                        
     "An Act relating to  the expenses of investigation, hearing, or                                                            
     public advocacy before  the Regulatory Commission of Alaska, to                                                            
     calculation of the  regulatory cost charge for public utilities                                                            
     and pipeline carriers  to include the Department of Law's costs                                                            
     of  its public  advocacy  function,  to inspection  of  certain                                                            
     books  and records by the attorney  general when participating                                                             
     as  a party in  a matter  before the Regulatory  Commission  of                                                            
     Alaska; and providing for an effective date."                                                                              
                                                                                                                                
                                                                                                                                
This  was the first  hearing  for this  bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
Co-Chair Wilken stated  this bill, sponsored by the Senate Labor and                                                            
Commerce  Committee,  "clarifies  that the  general  cost of  public                                                            
advocacy   for  utility   and  pipeline  matters   before   the  RCA                                                            
(Regulatory  Commission of  Alaska) would be  paid by receipts  from                                                            
the regulatory cost charge and not from the general fund."                                                                      
                                                                                                                                
JANE  ALBERT,  staff  to Senator  Bunde,  presented  the  bill.  The                                                            
previous  year the legislature  passed Executive  Order #111,  which                                                            
transferred  the public  advocacy responsibility  regarding  utility                                                            
matters from  the Regulatory Commission  of Alaska to the  Office of                                                            
the Attorney General within  the Department of Law. She continued to                                                            
testify as follows.                                                                                                             
                                                                                                                                
     [Note:  in this paragraph the  references to the Department  of                                                            
     Labor  are intended to  refer to the  Department of Law.]  This                                                            
     bill, SB 392, is a  follow-up bill that provides the Department                                                            
     of   Labor  reasonable   access  to   records,  and   clarifies                                                            
     regulatory  cost  charges,  and  not  the  general  fund,  will                                                            
     continue  to pay  for  the costs  relating to  providing  these                                                            
     public  advocacy services. SB  392 also adjusts the  regulatory                                                            
     cost  charge ceiling,  giving the RCA  and Department  of Labor                                                            
     separate  and fixed percentages  of total cost charge  receipts                                                            
     under  the adjusted  ceiling. And  a final item  for SB  392 is                                                            
     that it exempts State  agencies from paying the allocated costs                                                            
     of RCA  proceedings when it is  in an involved party.  And that                                                            
     is  the basic  introduction,  and that  is pretty  much what  I                                                            
     think Senator  Bunde would have done in introducing  this bill,                                                            
     and  we have Daniel  Patrick O'Tierney  from the Department  of                                                            
     Law available for specifics.                                                                                               
                                                                                                                                
DANIEL  PATRICK  O'TIERNEY,   Senior  Assistant  Attorney   General,                                                            
Commercial/Fair  Business  Section,  Civil Division,  Department  of                                                            
Law,  testified  that  this  bill  is a  completion  of  the  intent                                                            
expressed in  Executive Order #111.  Specifically, this legislation                                                             
clarifies the  authority given the RCA in Executive  Order #111, and                                                            
provides independence  between the RCA and the public  advocate. The                                                            
fiscal notes  are based  upon regulatory  cost charge receipts,  and                                                            
not general  funds. The  Department of Law,  the industry,  consumer                                                            
groups, and the RCA have  all worked to produce this legislation. He                                                            
continued to testify as follows.                                                                                                
                                                                                                                                
     The  benefits   of  this  bill   are  that  it  completes   the                                                            
     consolidation of public  advocacy within the Department of Law.                                                            
     It gives this function  budgetary independence from the RCA. It                                                            
     provides  the Department  of  Law qualified  access to  utility                                                            
     records  for economical  investigation,  and it eliminates  the                                                            
     inefficiency  involved with one  establishment cost  allocating                                                            
     another in proceedings before the RCA.                                                                                     
                                                                                                                                
Co-Chair Wilken  asked if any other State regulatory  agency employs                                                            
similar  procedures or whether  this legislation  would implement  a                                                            
new process.                                                                                                                    
                                                                                                                                
Mr. O'Tierney  responded that Executive  Order #111 implemented  the                                                            
transfer  of authority between  the RCA and  the Department  of Law.                                                            
Prior  to  the  Executive  Order  #111  public   advocacy  had  been                                                            
performed by  a subset of the Regulatory  Commission of Alaska.  The                                                            
industry indicated  little confidence  in the integrity of  the past                                                            
approach.  In at least one-third  of states  public advocacy  is the                                                            
responsibility of the Department of Law.                                                                                        
                                                                                                                                
PAT  LUBY,  Advocacy  Director,  American   Association  of  Retired                                                            
Persons (AARP),  Alaska, testified  that the AARP strongly  supports                                                            
this legislation and recommends a yes vote.                                                                                     
                                                                                                                                
Senator Dyson  offered a  motion to report  the bill from  Committee                                                            
with individual recommendations and new fiscal note.                                                                            
                                                                                                                                
Without  objection SB  392 MOVED from  Committee  with a new  fiscal                                                            
note of $300,000 dated 4/22/04 from the Department of Law.                                                                      
                                                                                                                                
AT EASE 3:17 PM / 3:17 PM