Legislature(1995 - 1996)

02/21/1995 01:30 PM L&C

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
               SENATE LABOR AND COMMERCE COMMITTEE                             
                       February 21, 1995                                       
                           1:30 p.m.                                           
 MEMBERS PRESENT                                                               
 Senator Tim Kelly, Chairman                                                   
 Senator John Torgerson, Vice Chairman                                         
 Senator Mike Miller                                                           
 Senator Judy Salo                                                             
  MEMBERS ABSENT                                                               
 Senator Jim Duncan                                                            
  COMMITTEE CALENDAR                                                           
 SENATE BILL NO. 65                                                            
 "An Act expanding the services that may be offered by an electric             
 cooperative to include direct satellite television, sewer, water,             
 or gas services when authorized by the Alaska Public Utilities                
 Commission; relating to officers of a telephone or electric                   
 cooperative; relating to amendment of the articles of incorporation           
 of a telephone or electric cooperative; and providing for an                  
 effective date."                                                              
  PREVIOUS ACTION                                                              
 No previous action                                                            
    WITNESS REGISTER                                                           
 Mary Jackson                                                                  
 Legislative Aide to Senator Torgerson                                         
 State Capitol                                                                 
 Juneau, Alaska  99811                                                         
  POSITION STATEMENT:  Testified for the sponsor of SB 65                      
 Dave Hutchens                                                                 
 703 W. Tudor #200                                                             
 Anchorage, AK  99503                                                          
  POSITION STATEMENT:    Testified in support of SB 65                         
  ACTION NARRATIVE                                                             
  TAPE 95-6, SIDE A                                                            
 CHAIRMAN KELLY called the Senate Labor and Commerce Committee                 
 meeting to order at 1:30 p.m.  The committee took up SB 65.                   
 MARY JACKSON testified for Senator Torgerson, sponsor of SB 65.               
 She explained SB 65 extends services provided by electrical                   
 cooperatives to include satellite television, water, sewer and gas.           
 The bill was prompted by revisions in the federal government's loan           
 program which provides loans for water and sewer.  Senator                    
 Torgerson's district is particularly interested in the satellite              
 television service.  There is also potential for using this bill to           
 provide gas service in the smaller areas which is not financially             
 feasible for larger cooperatives or private ventures.  SB 65 also             
 includes statutory housekeeping changes relating to the titles                
 established by the by-laws of the corporation.  Two fiscal notes              
 have been submitted, the APUC note shows no cost until the third              
 year, at which time the cost would be $75,000.  The other fiscal              
 note is zero.                                                                 
 SENATOR KELLY asked if there was a positive fiscal note.  MS.                 
 JACKSON explained one of the fiscal notes indicated there would be            
 a $1,000 cost per year as the result of the permitting process.               
 Number 60                                                                     
 DAVE HUTCHENS, Executive Director of the Alaska Rural Electric                
 Cooperative Association (ARECA), stated his support of SB 65.  He             
 commented the most important section of the bill is Section 2 which           
 provides for the expansion of power that Ms. Jackson described.  He           
 emphasized SB 65 does not give any automatic right to serve in an             
 area to any electric utility, it is simply a change in the                    
 corporate powers of the electric cooperative.  They would still be            
 required to go through the same regulatory process as anyone else             
 to get a certificate to provide each of the different services.               
 Section 1 clarifies that it is not the intent to permit electric              
 cooperatives to go in on top of someone and provide a service.                
 Section 2 is specific to corporate powers, and not to anything                
 related to the Alaska Public Utilities Corporation (APUC).  The               
 bulk of SB 65 is related to housekeeping measures.  Several                   
 sections are conforming amendments that correspond to Section 3,              
 which sets the policy allowing the electric cooperatives, in their            
 bylaws, to determine what to call their own board officers.  This             
 is not a significant issue for most, but enables a few to go to               
 Wall Street to obtain financing.                                              
 SENATOR KELLY asked when direct satellite cable television would be           
 able to come on line.  MR. HUTCHENS indicated another satellite               
 would have to be launched, which will take a couple of years.                 
 SENATOR KELLY asked if SB 65 is more of a planning mechanism.  MR.            
 HUTCHENS replied affirmatively, and pointed out the immediate need            
 is the sewer and water service because of changes in the U.S.                 
 Department of Agriculture that have consolidated those loan                   
 programs.  When the change is being made, ARECA would like to have            
 these additional services made available as well.  SB 65 plans for            
 the eventuality that direct satellite television will be available            
 in two years.  Naknek Electric serves Naknek, South Naknek, and               
 King Salmon.  They think there is natural gas in the area that                
 would be sufficient for local use and they would like to be able to           
 provide that service.                                                         
 Number 132                                                                    
 SENATOR KELLY asked if the satellite television service would                 
 impact any areas that are currently served under a cable so that              
 the cable alternative would be prohibited.  MR. HUTCHENS replied              
 no, and whether or not SB 65 passes, direct satellite television              
 will be made available by someone.  SB 65 allows the service to be            
 provided through the electric cooperative, rather than having to              
 establish separate corporations.   Consumers would buy their own              
 hardware.  SENATOR KELLY asked if the electric cooperative would              
 essentially provide a billing service.  MR. HUTCHENS indicated it             
 SENATOR MILLER expressed concern about the fiscal note, since the             
 APUC considers the fiscal note a blank check.  He asked that the              
 committee request the Finance Committee to look at the APUC to                
 prevent them from using fiscal notes to increase their number of              
 SENATOR TORGERSON moved SB 65 out of committee with individual                
 recommendations.  SENATOR KELLY noted there has been no notice of             
 opposition to SB 65.  Without objection, SB 65 was moved out of               
 committee with individual recommendations.                                    
 SENATOR KELLY adjourned the meeting at 1:40 p.m.                              

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