Legislature(1997 - 1998)
02/06/1998 03:30 PM RES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SCR 20 - STATE AREAWIDE LEASING PROGRAM SENATOR DRUE PEARCE, representing Area F in Anchorage, stated she sponsored SCR 20 at the request of the Support Industry Alliance. The Nineteenth Legislature unanimously passed a bill in 1996 that allows areawide leasing. The first areawide lease will occur in Cook Inlet; the second will occur on the North Slope. Areawide leasing is meeting with some resistance and is being legally challenged. The Alliance has asked the Twentieth Legislature to voice its position on areawide leasing to help fight court challenges to specific areawide lease sales. SCR 20 voices the Legislature's support. SENATOR TAYLOR asked if this process utilizes stakeholder meetings. SENATOR PEARCE said the first stakeholder event happened in Lease Sale 85A which was a specific lease sale. The Administration then convened a stakeholder process for the areawide lease sale in Cook Inlet. She expressed concern that this process has led to specific points and areas that opponents to leasing of any sort will use to challenge areawide leasing in court. Senator Pearce said that while the resolution does not speak to the whole stakeholder process, she thought that process is outside of the bounds of the statute. SENATOR TAYLOR noted he did not understand where the stakeholder process came from because he did not believe it was part of the 1996 legislation. SENATOR PEARCE answered it was not and is actually a process that is completely outside of the law. SENATOR TAYLOR said he would not suggest encumbering SCR 20 with any controversy about the stakeholder process because he understands the purpose and need for which the resolution was submitted. He added it is his understanding there is absolutely no legal authorization for the stakeholder process and its intended effect is to further convolute and delay the process, and provide opportunities for additional litigation. He repeated the stakeholder process is being used to stifle the policy and intent of the 1996 Legislature. VICE-CHAIR GREEN stated the Legislature needs to be vigilant of several issues, not only areawide leasing, because some of the same groups use court challenges and other methods to delay progress made by other industries. Number 96 KAREN COWERT, General Manager for the Alaska Support Industry Alliance, read the following statement. The Alliance is a statewide trade organization representing businesses that provide products and services to oil and gas companies and activities. One of the most important issues facing Alaska's oil and gas industry, and thus the economy, is the State's new areawide leasing program. It would appear that the Legislature agreed, having passed the law creating the program. In fact, the vote says it all, and in 1996 every single one of Alaska's elected officials, Democrat, Independent, and Republican, passed HB 388. As a trade organization consisting of over 300 businesses that supplies products and service to oil and gas companies and activities, and representing 25,000 employees, the Alliance was extremely pleased to see the law pass in such a unified manner. Unfortunately, there are those that are choosing to ignore our State leaders unanimous passage of areawide leasing. The opposition claims that they did not have sufficient time to express their opinions on this piece of legislation. Given the two year time period during which the bill was considered and modified, the Alliance believes there was more than ample time to provide comment at numerous stages. For this reason the Alliance asks that the Legislature reiterate support for areawide leasing through this resolution. This reiterization will assist the Alliance and others in efforts to accurately portray the program and the benefits to be reached by all Alaskans. In closing, smart global economy, efficiency in government, business and job opportunities, additional royalty revenue for our permanent fund when the industry is given the opportunity to explore, develop, and produce oil and gas, realizes that areawide simply makes good sense for Alaskans. Thank you for allowing me the opportunity to support your resolution and I'd be happy to answer or address any concerns or questions you might have of the Alliance. SENATOR TAYLOR stated he appreciates the fact that the resolution was brought on an affirmative basis. He does not believe any committee member wants to slow its movement, but he felt it would be a failure on the part of the committee to discuss the extensive amount of background and time spent on HB 388. As a legislator in 1996, he recalled that extensive discussion in both houses about all aspects of the program occurred. He repeated his frustration that the stakeholder process is totally unauthorized, and has nothing to do with the 1996 legislation. He questioned who had the authority to create the stakeholder process, and what funding source is being used. He concluded by saying this Administration authorized the stakeholder process to intentionally destroy and defeat the policy set by the Legislature in SB 308. SENATOR PEARCE clarified that HB 388 was the bill that created areawide leasing; SB 308 was sponsored by her, passed during the Eighteenth Legislature and revised the leasing process and established a phase process. She said Senator Taylor was speaking to the fact that the stakeholder process adds something that is not in the leasing process. She said, in her opinion, one of the reasons the stakeholder process is being used is that it is a back door attempt to eliminate phasing. SENATOR TAYLOR stated the legislative intent of SB 308 was very clear. Number 175 SENATOR TORGERSON said he supported the initial process for Lease Sale 85. During that process there was a lot of debate. He explained that fishermen opposed the lease sale because drilling would occur in the fishing corridor during fishing season. Fishing would be restricted within a geographical boundary, with heavy fines imposed for fishing outside of the restricted area. During that process, a decision was made to not drill in that corridor during the fishing season. He commented however, that often the same arguments were repeatedly used for other aspects of the lease by people who object to anything. He said that is where he thinks the stakeholder process has gotten out of whack. SENATOR TORGERSON moved SCR 20 out of committee with individual recommendations and its accompanying zero fiscal note. There being no objection, the motion carried.