Legislature(1993 - 1994)
03/31/1993 08:00 AM House RES
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 197: APPROP: ALYESKA SETTLEMENT Number 029 REPRESENTATIVE HARLEY OLBERG, PRIME SPONSOR OF HB 197, explained that the bill would appropriate approximately $28.2 million from the Alyeska settlement. He referred to the agreement and consent decree dated November 25, 1992, entered into between the United States, the State of Alaska and Alyeska. Of that amount, he said that $14.5 million would go toward docks and storage facilities, $6 million would be for construction of a road from Cordova to Shepherd Point, $7.5 million would be for the acquisition of land for Kachemak Bay State Park, and $200,000 would purchase communications equipment. REPRESENTATIVE OLBERG noted that the original request was over $31 million, and the difference is accounted for by $2 million paid to the federal government for expenses incurred in the lawsuit. He noted further that $1.5 million has already been paid to the state of Alaska as reimbursement for lost raw fish taxes. The key elements in the settlement agreement he said were: 1) the way the money is to be used is specified; and 2) a blackmail clause is included so that if the projects are not authorized by September 15, 1993, the funds revert to the trustees. REPRESENTATIVE OLBERG also noted that the trustees had spent approximately $200 million with no visible sign of it in Prince William Sound or any other spill-affected area. Number 102 REPRESENTATIVE DAVID FINKELSTEIN asked Representative Olberg to describe the difference between the amount in the House State Affairs committee substitute (CS) and the original version of HB 197. REPRESENTATIVE OLBERG noted that he was working off the original version and not the State Affairs CS. Number 120 REPRESENTATIVE FINKELSTEIN asked if the committee might also see a copy of the settlement agreement. REPRESENTATIVE OLBERG offered to briefly read from the settlement agreement: "If the acquisition [of Kachemak Bay State Park] is rendered impossible because these funds have not been appropriated for the purpose specified by December 31, 1993, the funds allocated for this project will be phased into the joint trust fund." He then described the allocation of funds for the other projects if they did not materialize, and said those monies also would revert to the joint trust fund. REPRESENTATIVE FINKELSTEIN referred to the State Affairs CS and asked if the difference resulted from that committee taking out the Kachemak Bay buy-back. REPRESENTATIVE OLBERG answered that this was correct. He noted that after the State Affairs committee adopted its CS, the House Special Committee on Oil and Gas re-adopted the original version of HB 197. REPRESENTATIVE FINKELSTEIN asked about the legal effect on the settlement if the distribution of the monies was tampered with, and whether that would render it moot. Number 169 REPRESENTATIVE OLBERG answered that if the agreement were tampered with, it was his understanding it would be rendered moot, and the funds would revert to the trustees. REPRESENTATIVE FINKELSTEIN suggested the committee seek the advice of legislative legal counsel on the issue of what happens if any changes are made. REPRESENTATIVE OLBERG noted that Crag Tillery of the Attorney General's office had testified at the State Affairs committee hearing and related the same opinion. He also clarified for Representative Bunde that the original version of HB 197 mirrored the settlement agreement. REPRESENTATIVE FINKELSTEIN was still curious about what would happen if the distribution of funds were tampered with or changed. Number 200 VICE CHAIRMAN BILL HUDSON arrived late and asked for an explanation of the difference in appropriation amounts between the State Affairs CS and the original version of HB 197. REPRESENTATIVE OLBERG explained the amounts again for Representative Hudson's benefit. CHAIRMAN WILLIAMS noted for the record that Representatives Hudson and Green had joined the meeting. REPRESENTATIVE JOHN DAVIES asked if there was a reason the State Affairs committee had removed the funding for the Kachemak Bay State Park. Number 217 REPRESENTATIVE OLBERG replied that yes, there was a reason. VICE CHAIRMAN HUDSON asked if the administration had taken a stand on HB 197. REPRESENTATIVE OLBERG told him that HB 197 was the administration's bill, and that they had no hint of reservation. He added that the attorney general had drafted the settlement on which the bill was based. REPRESENTATIVE FINKELSTEIN asked why the site at Shepherd Point had been selected, and how that site fits into oil spill response plans. REPRESENTATIVE OLBERG said its significance is that it is the nearest physical location to Cordova where a deep water port could be built which could accommodate a large vessel. Number 250 VICE CHAIRMAN HUDSON added to that explanation, and said that most waterways around Cordova are shallow and, in fact, after the earthquake in 1964 the area went dry. Shepherd Point, he said, was a good place to position equipment for response to any spill that might occur at Knoll's Head or other locations. He also remarked that this would be an excellent economic development opportunity for Cordova, because the port could be used by tour ships. He liked the idea of a port at Shepherd Point. Number 268 REPRESENTATIVE CON BUNDE offered a MOTION to move HB 197 from committee with individual recommendations. Number 280 REPRESENTATIVE FINKELSTEIN still had concerns about the Shepherd Point Road site and how it fits into the state's overall spill response plan. He wanted the legislature to hear from the Department of Environmental Conservation and from Crag Tillery of the Department of Law, but said that he would not object to the motion. Number 302 PAUL FUHS, COMMISSIONER OF THE DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT (DCED), testified that the administration supports the Kachemak Bay State Park purchase. The interest there is not in the timber, he said, but rather in the recreation and tourism potential. In the Senate version of HB 197, he said, money would go to Chugach Corporation through the DCED, and that would have to be resolved somehow with HB 197. The rationale on the Senate side, he explained, was to reduce overhead to the Department of Transportation. MR. FUHS added that another reason was that the DCED had been working closely with the communities involved in dock and storage development, tourism, and other economic development. The DCED has also worked with the City of Cordova on the Shepherd Point project, he said. Number 320 REPRESENTATIVE FINKELSTEIN asked how Chugach Corporation enters the picture. He said they were not mentioned in HB 197. MR. FUHS noted that the regional corporation has an agreement with some of the village corporations to do the projects included in HB 197. Number 337 CHAIRMAN WILLIAMS asked if there were any objections to the motion to move HB 197 from committee. Hearing none, the MOTION PASSED. CHAIRMAN WILLIAMS announced that the committee would next take up HB 239.
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