03/30/2016 01:00 PM House RESOURCES

                 HB 282-AGDC BOARD OF DIRECTORS                                                                             
                                                                                                                                
1:21:44 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TALERICO  announced that the  next order of  business is                                                               
HOUSE BILL  NO. 282, "An Act  relating to the board  of directors                                                               
of   the   Alaska   Gasline   Development   Corporation;   adding                                                               
legislators as  nonvoting members  of the  board of  directors of                                                               
the Alaska Gasline Development Corporation;  and providing for an                                                               
effective date."                                                                                                                
                                                                                                                                
1:21:48 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE CHENAULT,  prime sponsor  of HB 282,  advised that                                                               
the  bill  has two  provisions,  one  of which  Senator  Costello                                                               
identified  when   speaking  about  CSSB  125(RES).   The  second                                                               
provision,  he advised,  would amend  AS  31.25.020(b) and  would                                                               
require the  governor to appoint  four of the five  board members                                                               
of  the Alaska  Gasline Development  Corporation (ADGC)  who have                                                               
experience and  expertise in  natural gas  pipeline construction,                                                               
operation,  marketing,  finance,  large  project  management,  or                                                               
other expertise and  experience that is relative  to the purpose,                                                               
powers, and duties of AGDC.   One board member is not required to                                                               
have the  expertise previously outlined.   He explained  that the                                                               
original  language established  under Senate  Bill 138  for board                                                               
member  appointment qualifications  was  permissive.   Currently,                                                               
the board  consists of five  public members and  two departmental                                                               
commissioners.    He  noted  that   the  commissioners  from  the                                                               
Department  of  Revenue  (DOR)  and  the  Department  of  Natural                                                               
Resources (DNR) are prohibited from serving on the board.                                                                       
                                                                                                                                
REPRESENTATIVE  CHENAULT  advised  that the  original  intent  of                                                               
House Bill 369,  House Bill 4, House Bill 9,  and Senate Bill 138                                                               
was  to  have  a  board  free  from  political  interference  and                                                               
influence, and to make decisions  based on the state's and AGDC's                                                               
best interests.  However, this has  changed in the last few years                                                               
as most  of the board members  do not have the  qualifications of                                                               
previous board  members, nor have  the expertise that  was sought                                                               
under  Senate Bill  138.   Once pre-front-end  engineering design                                                               
(Pre-FEED) is  completed and if  the decision is made  to advance                                                               
to  front-end engineering  design (FEED),  it is  imperative that                                                               
the  AGDC board  be comprised  of  members who  provide the  best                                                               
expertise available.  Governor Bill  Walker stated, in requesting                                                               
the  resignation of  the  original president  of  AGDC, that  the                                                               
executive of  the corporation  have the ability  to take  AGDC to                                                               
the next level, and the same should be true of the board.                                                                       
                                                                                                                                
1:24:34 PM                                                                                                                    
                                                                                                                                
TOM   WRIGHT,  Staff,   Representative  Mike   Chenault,  advised                                                               
Representative Josephson  that the court case  was South Carolina                                                             
v.  Public  Interest Foundation  and  Edward  D. Sloan  v.  South                                                             
Carolina Transportation Infrastructure Bank,  [379 S.C. 160, 169,                                                             
666 S.E.2d 236, 241  (2008)].  He said it is  the only court case                                                               
the sponsor has  been able to locate that discusses  the issue of                                                               
legislators serving  as nonvoting  members.  When  discussing the                                                               
nonvoting  members,  he opined  that  if  the administration  was                                                               
concerned  about that  it  would have  legislation  out there  to                                                               
discuss  the Alaska  Seafood Marketing  Institute (ASMI).   There                                                               
are  not   statutes  that  specifically  state   that  ASMI  have                                                               
legislators  serving on  that  board.   As far  as  the Knik  Arm                                                               
Bridge  and  Toll Authority  (KABATA)  and  the Alaska  Aerospace                                                               
Corporation,  if  this was  a  concern  he  would expect  to  see                                                               
legislation from the administration addressing this.                                                                            
                                                                                                                                
REPRESENTATIVE JOSEPHSON  noted that the existing  statute on the                                                               
governing body  for AGDC  is only  advisory, because  the statute                                                               
states, "when  appointing the governor shall  consider", and then                                                               
it goes on to discuss the  expertise that is wanted.  He inquired                                                               
whether  the sponsor's  amendment  would  basically require  that                                                               
that expertise be there for sure.                                                                                               
                                                                                                                                
MR. WRIGHT replied correct.                                                                                                     
                                                                                                                                
1:26:29 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  SEATON  asked  whether  there  is  a  termination                                                               
clause  for   current  board   members  who   do  not   have  the                                                               
qualifications the bill requires.                                                                                               
                                                                                                                                
MR.  WRIGHT  responded  that  the sponsor's  intent  is  for  the                                                               
current board  members to remain  and when new  appointments come                                                               
up  that the  qualifications be  part of  the consideration  when                                                               
nominating someone.                                                                                                             
                                                                                                                                
1:27:27 PM                                                                                                                    
                                                                                                                                
CO-CHAIR TALERICO  said he  will hold  over HB  282 and  that his                                                               
plan is  to generate  a committee  substitute (CS)  that utilizes                                                               
both CSSB 125(RES) and HB 282.                                                                                                  
                                                                                                                                
REPRESENTATIVE JOSEPHSON  pointed out  that the  opinions offered                                                               
are what are  called "persuasive opinions" as they  are from out-                                                               
of-state.  Persuasive  opinions can have some  authority but they                                                               
generally are not  persuasive relative to Alaska  decisions.  The                                                               
attorney general  cites two Alaska decisions  and three attorneys                                                               
general  opinions and  states  that even  nonvoting  status is  a                                                               
problem.                                                                                                                        
                                                                                                                                
REPRESENTATIVE  TARR  commented  that  she will  work  with  both                                                               
sponsors as she is interested  in addressing the issue of whether                                                               
the  members can  be added,  and actually  having a  majority and                                                               
minority member added as nonvoting members.                                                                                     
                                                                                                                                
[HB 282 was held over.]