Legislature(2005 - 2006)BUTROVICH 205
04/22/2006 09:30 AM JUDICIARY
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* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SB 316-COURT REVIEW OF STRANDED GAS DECISION 11:08:38 AM CHAIR RALPH SEEKINS announced SB 316 to be up for consideration. He said the intent today was to discuss proposed language so that the bill could move forward. The committee did not expect to move the bill out but the chairman hoped to do constructive work on it. He said his draft would allow the Legislature to view the contract and would allow a public citizen to challenge the findings and determinations provided that the Legislature authorized and approved the signing of the contract. If the committee agreed on the draft, he would have it drawn up into a committee substitute (CS) to be considered on the following hearing date. 11:10:31 AM CHAIR SEEKINS said as he reads the original bill, the challenge could be made at the point where the decision was made to execute the contract. There was nothing for the court to consider until an action on the contract was made. It appears that the Senate Judiciary Standing Committee is trying to put one more step into the process before there could be a judicial review, he stated. Any challenger to the contract would legitimately try to determine whether or not the contract was in the best fiscal interest of the state. The only party that could possibly challenge a contract while it was in the middle of the process would be someone who wanted to "high- center" the contract and halt the process for political or private reasons, which should not be allowed. The opportunity for any challenge should be at the end of the process. 11:12:41 AM CHAIR SEEKINS said he was also concerned that there be plenty of opportunity to view the body of evidence that the commissioner used to come to his conclusion. For example, currently the commissioner has not released any preliminary findings and as a result, none of the body of evidence, including the contract currently under consideration, is a public document except for the proprietary information identified in Section 310. SENATOR GENE THERRIAULT said there is a category of documents that are part of the deliberative process that can also be withheld. CHAIR SEEKINS said his concern was that every document that would be discoverable in a legal challenge should be made public. 11:15:16 AM CHAIR SEEKINS directed the committee's attention to the current Stranded Gas Act (SGA), page 21, line 8, and the term "supporting financial, technical, market data." He said that indicated that only the documents supporting a particular decision are required to be disclosed. He passed out his untitled draft and proposed that word "supporting" would be deleted, thereby broadening the amount of documents that would be discoverable. SENATOR HOLLIS FRENCH noted there are two clear definitions of the word "support." A government lawyer would lose his argument that the only documents that get released are the ones favoring his client. He said every single word is subject to contrasting interpretations. CHAIR SEEKINS asserted the importance of transparency and inclusion regarding consideration of any contract. SENATOR FRENCH pointed out in the same paragraph it states the documents "considered by the commissioner" would be submitted with the final findings and determination. A clever federal government lawyer could contend that many of the documents were not "considered," he stated. CHAIR SEEKINS replied that the Legislature could only hold the commissioner to those things that he actually considered. 11:21:00 AM CHAIR SEEKINS said the intent was to make the bill as clear as possible and to allow someone to examine the body of documents that the commissioner used to come up with the final findings and determination. At that point, the Legislature goes to work and it becomes their responsibility to examine the contract to ensure that it meets the terms of the SGA. 11:24:52 AM CHAIR SEEKINS asked the committee whether they were in agreement regarding the steps they want the process to go through. They would make sure that the body of evidence that the commissioner used to come up with his preliminary findings is made public at the point that the preliminary findings are signed. Then there would be a period of time of at least 30 days for the legislative and public review. Then the commissioner would close off public comment and within 30 days prepare a summary of the public comment and legislative comment. He would consolidate the body of evidence together and bring it to the governor along with the contract. The governor would then forward all of that to the Legislature. 11:27:07 AM SENATOR FRENCH interrupted to ask whether the committee was operating under the new [untitled] draft. CHAIR SEEKINS said yes and read Section 43.82.430 as follows: Sec. 43.82.430. Final findings, determination, and proposed amendments; execution of the contract. (a) Within 30 days after the close of the public comment period under AS 43.82.410(4), the commissioner of revenue shall (1) prepare a summary of the public comments received in response to the proposed contract and the preliminary findings and determination; (2) after consultation with the commissioner of natural resources, if appropriate, and with the pertinent municipal advisory group established under AS 43.82.510, prepare a list of proposed amendments, if any, to the proposed contract that the commissioner of revenue determines are necessary to respond to public comments; (3) make final findings and a determination as to whether the proposed contract and any proposed amendments prepared under (2) of this subsection meet the requirements and purposes of this chapter. (b) After considering the material described in (a) of this section and securing the agreement of the other parties to the proposed contract regarding any proposed amendments prepared under (a) of this section, if the commissioner determines that the contract is in the long-term fiscal interests of the state, the commissioner shall submit the contract to the governor. SENATOR FRENCH noted for the people watching on television that the chairman was reading the statute as it currently stands and is suggesting no change to AS 43.82.430. CHAIR SEEKINS agreed and said he just wanted to make it clear. He read Section 435 as he proposed in his draft CS. Sec. 43.82.435. Legislative authorization. (a) The governor may transmit a contract developed under this chapter to the legislature together with a request for authorization to execute the contract. (b) Concurrent with the submission of the contract and request for authorization to execute the contract to the legislature, the governor shall: (1) submit the commissioner's final findings and determinations and the financial, technical, market data, including work papers, analyses, and recommendations of any independent contractors used under AS 43.82.240, that were considered by the commissioner to make the final findings and determinations to the legislature; and SENATOR FRENCH interrupted to ask to whom the final findings and determinations would be submitted. CHAIR SEEKINS said to the Legislature. He continued reading his proposed language to the committee and clarified that there would be 120 days after the execution of the contract for someone to be able to bring a challenge. 11:31:43 AM SENATOR CHARLIE HUGGINS reported that Chair Seekins' CS would satisfy the concerns of his constituents. SENATOR GUESS agreed with Senator Huggins. She asked whether the law authorizing the contract is what would be challenged. CHAIR SEEKINS explained that the challengeable part would be that the contract entered into was not cohesive to the long-term fiscal interest of the state. SENATOR FRENCH compared Chair Seekins' proposed Section 440 with the current AS 43.82.440 and said, "it looks as if a person could challenge the enforceability of a contract executed under a law authorizing the contract." 11:34:10 AM CHAIR SEEKINS agreed to add that into his CS. SENATOR FRENCH reiterated his earlier concern with changing the focus of the legal contest from the findings and determination of the commissioner to the findings and determinations forwarded to the Legislature. He said he could not know for a certainty that the committee wasn't "shrinking" the amount of discoverable information. CHAIR SEEKINS said he has struggled over that because it is difficult to challenge the actions of the Legislature in passing a law. If the Legislature were to determine that the contract did not meet the requirements of the law, they could still accept it because a new law would authorize it. SENATOR HUGGINS said he heard Senator French say that the language of the proposed CS denotes a narrowing of things that would be available for people to challenge. SENATOR FRENCH agreed that was his concern. CHAIR SEEKINS said that it was not his intent to narrow the scope of the challenge but to properly place it. 11:37:05 AM CHAIR SEEKINS asserted under the old law there was a clumsy situation that would allow a "high-centering" of a contract. He advised the committee that he would submit his CS to the drafters for their review and bring the bill up again. He held SB 316 in committee.