Legislature(1999 - 2000)
02/18/1999 01:40 PM House FIN
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
TAPE HFC 99 - 24, Side 1.
TAPE HFC 99 - 24, Side 2.
TAPE HFC 99 - 25, Side 1.
HOUSE BILL NO. 12
"An Act relating to an easement for the extension of the Alaska
Railroad to the Alaska-Canada border."
Co-Chair Mulder Moved to Rescind previous action taken on the bill.
There being NO OBJECTION, the action was rescinded. The original bill
was before the Committee for consideration.
Representative J. Davies MOVED to adopt Amendment #1 into HB 12.
There being NO OBJECTION, it was adopted.
Representative J. Davies explained that the amended language would be
placed in a different portion of the statute. Legal Counsel believes
that it would make more sense to place it in the section as
recommended in Amendment #1.
There being NO OBJECTION, Amendment #1 was adopted.
Representative J. Davies MOVED to report CS SSHB 12 (FIN) out of
Committee with individual recommendations and with the accompanying
zero fiscal notes. There being NO OBJECTION, it was so ordered.
CS SS HB 12 (FIN) was reported out of Committee with a "do pass"
recommendation and with zero fiscal notes by the Department of Natural
Resources dated 2/3/99 and Department of Transportation and Public
Facilities dated 2/3/99.
Co-Chair Therriault pointed out that the previous Committee Report
could be used with the addition of Representative Foster's signature
as he had not been present at the previous meeting. All Committee
members agreed.
GENERAL SUBJECT(S): OVERVIEW: ALASKA INDUSTRIAL DEVELOPMENT & EXPORT
AUTHORITY
OVERVIEW: POWER COST EQUALIZATION
REPORT OF THE BLUE RIBBON COMMISSION
(The following overview was taken in log note format. Tapes and
handouts will be on file with the House Finance Committee through the
21st Legislative Session, contact 465-2156. After the 21st Legislative
Session they will be available through the Legislative Library at 465-
3808.)
Time Meeting Convened: 1:40 P.M.
Tape HFC 99-24, Side 1.
Tape HFC 99-24, Side 2.
Tape HFC 99-25, Side 1.
PRESENT:
x
Representative G. Davis
x
Co-Chair Therriault
x
Representative Foster
x
Co-Chair Mulder
x
Representative Grussendorf
x
Vice-Chair Bunde
x
Representative Kohring
x
Representative Austerman
x
Representative Moses
x
Representative J. Davies
x
Representative Williams
ALSO PRESENT:
REPRESENTATIVE CARL MORGAN; REPRESENTATIVE MARY KAPSNER;
REPRESENTATIVE ANDREW HALCRO; RANDY SIMMONS, EXECUTIVE DIRECTOR,
ALASKA INDUSTRIAL DEVELOPMENT & EXPORT AUTHORITY (AIDEA), DEPARTMENT
OF COMMERCE AND ECONOMIC DEVELOPMENT; KEITH LAUFER, AIDEA,
DEPARTMENT OF COMMERCE AND ECONOMIC DEVELOPMENT; SAM COTTON,
CHAIRMAN, ALASKA PUBLIC UTILITIES COMMISSION, BLUE RIBBON COMMITTEE;
JOE GRIFFITH, (TESTIFIED VIA TELECONFERENCE), ANCHORAGE CHANBER OF
COMMERCE, BLUE RIBBON COMMITTEE, ANCHROAGE; PERCY FRISBY, DIRECTOR,
DIVISION OF ENERGY, DIVISION OF COMMUNITY AND RURAL DEVELOPMENT,
DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS; RICHARD EMERMAN,
PLANER, DIVISION OF ENERGY, DIVISION OF COMMUNITY AND RURAL
DEVELOPMENT, DEPARTMENT OF COMMUNITY AND REGIONAL AFFAIRS.
LOG
SPEAKER
DISCUSSION
TAPE HFC 99-2
Side 1.
000
Co-Chair
Therriault
Convened the meeting at 1:40 p.m.
Rescinding business of HB 12 was addressed
and Amendment #1 was adopted and the bill
MOVED from Committee with a "do pass"
recommendation and two zero fiscal notes
by Department of Natural Resources and
Department of Transportation and Public
Facilities.
Co-Chair Mulder
Co-Chair Mulder assumed Chair of the
meeting and introduced Mr. Simmons,
Executive Director and Mr. Laufer of AIDEA
421
RANDY SIMMONS,
EXECUTIVE
DIRECTOR, ALASKA
INDUSTRIAL
DEVELOPMENT EXPORT
AUTHORITY (AIDEA)
Addressed the mission of AIDEA to promote,
develop and advance the general prosperity
and economic welfare of AK by creating and
retaining jobs and helping to diversity
the economic base by financing industrial,
manufacturing, export and business
enterprise and facilities within AK.
453
Mr. Simmons
Spoke to the Page #1 of the handout. He
reiterated that the mission is to help
promote new jobs. It is a very broad
intent of promoting and developing and
advancing the general prosperity and
economic welfare of Alaskans.
549
Mr. Simmons
Spoke to AIDEA's goals which include: 1)
Providing business finance assistance
throughout Alaska through AIDEA's Credit
programs and by participating in or
guaranteeing bank originated loans.
608
Mr. Simmons
2) Evaluating potential development
projects as they are presented to AIDEA to
determine whether the Authority
development and ownership meets AIDEA's
mandate.
670
Mr. Simmons
AIDEA's Programs involve CREDIT and
DEVLEOPMENT FINANCE
723
Mr. Simmons
Within the credit program is Loan
Participation; Business and Export
Assistance; and Revenue Bond Program. He
noted that AIDEA does no direct loans and
that all are in participation with the
private sector, which has worked well.
801
Mr. Simmons
The second program is the Development
Finance, in which AIDEA owned and operated
projects must pass through a thorough
scrutiny due to a diligence process.
There is projects must be financially
feasible and endorsed by the local
government. Projects requiring more than
$10 million dollars in bonding require
legislative authorization.
976
Co-Chair
Therriault
Asked about the various projects.
988
Mr. Simmons
Noted that some of the projects could
stand on their own. He spoke to purely
revenue bonds and revenues which were
strong enough to support the bond.
1027
Co-Chair
Therriault
Asked about Ft. Knox
1036
Mr. Simmons
AIDEA only issued the bonds to that rate.
1050
Co-Chair
Therriault
Asked if one of the companies goes
bankrupt would the State by on the hook?
1067
Mr. Simmons
No, we would not be liable.
1080
Mr. Simmons
Addressed the Development Finance program
- the big piece of the AIDEA agreements
and has been entered into with the private
sector. For AIDEA to take a project like
that to the Board, the projects must be
financially feasible.
1143
Mr. Simmons
Emphasized that projects must be endorsed.
1154
Mr. Simmons
Authorization must be received in advance.
1177
Mr. Simmons
Suggested that projects could be very time
consuming. This category strongly
supports an infrastructure.
1202
Mr. Simmons
Spoke to the indicated recent
accomplishments listed on Page #4.
Mr. Simmons
Listed the projects: Purchased $40
million in loan participation;
Construction completed on the expanded
AIDEA owned DMTS; Healy Clean Coal
Project; Acquired Snettisham Hydroelectric
Project; provided $16 million dividend to
the GENERAL FUNDS and maintained triple A
bond rating
1302
Mr. Simmons
Spoke to the AIDEA Loan Portfolio listed
on Page #5. As of June 30, 1998, $40
million dollars in loans are outstanding.
1341
Representative
Foster
Pointed out that Anchorage has only 40% of
population in relationship to the number
of projects funded with AIDEA's help.
1363
Mr. Simmons
Noted that the loan portfolio has been
increasing every year to every section of
the State.
1380
Mr. Simmons
Page #6-Development Finance Projects
indicates direct jobs from each project.
He listed the Red-Dog mine; Skagway Ore
Terminal, Snettisham Hydroelectric, Alaska
Seafood Center.
1436
Representative
Grussendorf
Asked what is occurring with the Skayway
Terminal.
1460
Mr. Simmons
There exists 50 mines in the Yukon area
which need port facility. It will be a
couple of years before substantial use and
the benefits of the investment will be
felt.
1500
Co-Chair Mulder
Is it a lost investment at this time?
1510
Mr. Simmons
If facility is used, the money will be
coming back to the State. All projects
have a secondary use.
1539
Mr. Simmons
Stated that Red-Dog Mine is AIDEA's
biggest concern although it is the largest
zinc mine in the State.
1555
Representative J.
Davies
Status of Healy operations.
1566
Mr. Simmons
Healy was completed in 1997. There has
been a lawsuit filed. He stated that he
was not willing to go into details of that
lawsuit. Although, AIDEA is optimistic
that it will work out; the technology
appears to be going well.
1620
Mr. Simmons
Was comfortable that an agreement would
soon be made.
1630
Representative
Foster
Asked about the aircraft hanger referenced
on Page 5.
1652
Mr. Simmons
Replied that there are a couple of loans
out for air hangers at this time.
1663
Representative
Bunde
Pointed out that the Skagway Project has
been held up because of the cost of
minerals.
1677
Mr. Simmons
No. There are a number of people in
Skagway that want only tourism and not
mineral extraction. A few years ago, the
majority of people wanted the facility
consequently, there has been a separation
in that community.
1707
Representative G.
Davis
Referenced the Ketchikan Ship Yard and
asked if AIDEA's economic feasibility
study was based on federal dollars. He
stated that it was a competitive facility.
Would competitor e able to qualify for the
fed dollars.
1743
Mr. Simmons
When AIDEA took over the facility, it was
to make it a viable shipyard. The
community lobbied Senator Stevens and that
is how the T21 money became available.
1794
Mr. Simmons
It will be predicated on jobs. This
facility will need future help to be
viable.
1816
Co-Chair Mulder
What was purchased for the Seward
facility?
1831
Mr. Simmons
Chenille company offered to operate for
payments back with interest, using the
capital for upgrades. They have started
shipping again in January,1999. The
Railroad is negotiating a new contract.
1877
Mr. Simmons
Page #7-Potential Development Projects -
Kinetic Aviation; Air cargo facilities;
Outstanding Bond Authorization
1930
Mr. Simmons
Spoke in more detail of the Kinetic
Aviation, which promises to be a viable
project and will bring in cash to the
State. There is new technology tied with
it. AIDEA has provided them advice.
1985
Mr. Simmons
Air Cargo Facilities - the project is
closer to Mapco Wings and is more
concerned with the infrastructure costs.
They are willing to build out of pocket.
The airport, as in other states, should
assume payment for those costs.
2045
Mr. Simmons
There is a number of outstanding bond
authorizations. International cargo
facilities; Loading and shipping terminal
at Cook Inlet; Kodiak rocket launch
complex; Red Dog project improvement; Nome
port facilities; Railroad right-of-way in
Healy to Denali Park; Hatcher Pass ski
resort.
2150
Mr. Simmons
Referenced Page #8 - Investments
2176
Mr. Simmons
Stated that $250 million dollars in
investments has been approached by
conservative investing and managed by
outside managers. Investments are used
for many things.
2207
Mr. Simmons
Investment objectives must be sale,
liquid, and yield. The Conservative
investments are invested in US Treasuries,
US Agencies and Corporate bonds rated
triple a.
TAPE CHANGE
HFC 99 - 24
Side 2
000
Mr. Simmons
Spoke to the dividend policy. The
dividend program was created in 1996 and
carefully structured to allow AIDEA to
make a contribution to the general fund.
089
Mr. Simmons
AIDEA cannot pay any funds for large
investments
144
Mr. Simmons
Spoke to the unanticipated needs category.
Basically AIDEA tries to determine if they
have the ability to do the proposed
project. Since 1996, 40% of net income
has been used for projects from dividends.
238
Mr. Simmons
AIDEA now has new accounting procedure
called GASMI. There is $8.5 million
dollars in net income to date.
282
Mr. Simmons
Page #10 - Financial strength must to the
dividend program. The Bond Ratings and
the Bond Capacity have been working well
and have been selling triple an insured
bonds. This has been done for the 2nd time
with the Healy projects. Underline
ratings are A2 and A minus which is good.
The dividend program has worked well for
AIDEA
408
Mr. Simmons
Page 11 Budget History. Looking at ways
to cut their budget. AIDEA generates that
income that pays for their budget. From
that perspective, trying to not affect
currently running projects. When it
affects operation, they will come to
Legislature
489
Co-Chair
Therriault
Questioned a project occurring in the
Fairbanks North Star Borough
507
Mr. Simmons
Replied that estimating how to fix that
facility and then trying to determine if
AIDEA wants to be involved in a project.
Initial estimate was $30 thousand dollars.
551
Co-Chair
Therriault
Local assembly has decided that Co-Chair
Therriault is responsible for 30% of mill
rate increase.
578
Mr. Simmons
From a financial standpoint, AIDEA knows
that the facility will be bought.
609
Representative
Foster
Thanked AIDEA staff for all their help to
the rural areas.
638
Representative
Bunde
Timelines of development for aviation
project.
687
Co-Chair Mulder
Questioned the book value of AIDEA
706
KEITH LAUFER,
AIDEA, DEPARTMENT
OF COMMERCE AND
ECONOMIC
DEVELOPMENT
Replied that a total of $975 million, $.
765
Co-Chair Mulder
What would happen if AIDEA did not exist?
785
Mr. Simmons
AIDEA was created because other
conventional financing would not step in.
When conventional financing comes into an
area AIDEA steps out. Pointed out it would
be hard to recreate AIDEA. He noted that
the economy will shift. AIDEA does long
25-year loans that would not be financed
through conventional loan program. He
acknowledged that AIDEA has equity that
the state could use.
917
Co-Chair Mulder
Pointed out the conflict between the
business assistance and 80% banks - loans
guaranteed through AIDEA. Are banks more
aggressive because of this?
952
Mr. Simmons
Possibly although AIDEA does not just take
any loan. They must prove to be not too
risky.
987
Representative
Grussendorf
Spoke to the Red-Dog market concern and
mine. Selling points is the economic
employment of that project.
1027
Co-Chair Mulder
Noted the mission statement reference, in
that AIDEA is a unique factor and plays an
important role for the State.
1055
Mr. Simmons
Commented that the mission is to create
and maintain such projects, although, can
not create projects on their own.
1089
Mr. Simmons
The actual mission statement is much more
simple
1102
Co-Chair
Therriault
Has there been any thought about
broadening the mission statement.
1121
Mr. Simmons
AIDEA is trying to become more proactive.
Now trying to look at the process of
reducing budget. Currently do not have
substantial manpower to be more pro-active
work.
1162
Co-Chair Mulder
Questioned project from several years ago
in export loans.
1181
Mr. Simmons
That market has contracted substantially
since that original idea.
1200
Mr. Simmons
There is loan participation or finance
projects that are currently working.
AIDEA is better at selling services. That
program was modeled after other states.
1255
Representative
Kohring
How successful is AIDEA in enabling
projects in order to make it a reality.
He asked the history of the state's
investing in that type of project.
1290
Mr. Simmons
Red-Dog and Healy are the two best
examples.
1300
Representative
Kohring
He stated that it is projected that there
is less likelihood to be that type of
project with the current budget scenario.
He noted that he had drafted legislation
to allow other organizations to front
monies and use the State as a pass-
through. The idea might work to access
the federal dollars without the states 10%
money. Thus concluded the testimony given
by AIDEA.
1380
Co-Chair Mulder
Introduced Sam Cotton, Chairman, Governors
Blue Ribbon Commission.
1420
SAM COTTON,
CHAIRMAN, ALASKA
PUBLIC UTILITIES
COMMISSION, BLUE
RIBBON COMMITTEE
Mr. Cotton noted that Joe Griffith was on
line on teleconference. He pointed out
the make-up of the Governor's Commission,
which includes two members of the
legislature.
1519
Mr. Cotton
Noted that the Committee was appointed by
the Governor to address issues of high
cost power and try to determine the reason
of the high power costs.
1558
Mr. Cotton
Committee adopted a statement of support
for the program. Recommended reductions
to the program and be cut in +.
Facilities should be eligible and that a
stable source of funding be established.
1620
Mr. Cotton
Legislature is looking for funding other
than general funds. IT is important that
they consider the other funding scenario
impact. It is important to recognize that
Alaska is a high cost area. As a federal
employee in AK you would receive a 20%
cost of living allowance increase. It is
a high cost area.
1711
Mr. Cotton
He noted that "universal service" is not a
new concept. Some services are matched by
federal funding. He provided some examples
of potential for a universal service fund.
There is a great need for this program,
with the existing program being funded at
$23 million dollars. In the last few
years it has been funded at a near 75%
level.
1780
Mr. Cotton
This is a Blue Ribbon Committee and these
are the recommendations made by that
Committee to the Governor.
1801
Mr. Cotton
Cost of program is $15.7 million dollars.
Introduced members of the Committee.
1829
JOE GRIFFITH,
(TESTIFIED VIA
TELECONFERENCE),
ANCHORAGE CHAMPBER
OF COMMERCE, BLUE
RIBBON COMMITTEE,
ANCHORAGE
Spoke via teleconference
1862
Mr. Griffith
Stated that the numbers referenced are not
large. The typical kilowatt amount that a
PCE community generates per hour and that
the benefit has a substantial impact.
Usually this is 31% of community's energy.
Twice the amount paid by urban family.
The average of consumer pays $71 dollars
per month. If the assistance is
eliminated, the outlining areas will be
placed at financial risk. Without PCE,
utilities will be forced to increase rates
creating an economic problem and never
being able to raise enough revenue to pay
rates.
1970
Mr. Griffith
To reduce sales by 30% would cause Bush
Communities to fail and the burden will
fall upon the public users. Much of the
public and private infrastructure in rural
AK. The State has invested substantial
sums into the village areas and we do not
want to loose that.
2039
Mr. Griffith
Summed up the economic impact. It could
equate to a total of 210 jobs in the rail
belt area. If rates increase, there will
be small generators placed in village
areas.
2079
Representative
Bunde
Commented that an affordable power is a
necessity to rural Alaska.
TAPE CHANGE
HFC 99-25
Side 1
000
Representative
Bunde
Are we asking urban Alaska to subsidize
rural Alaska. What would the per capita
expense be? What is the bottom line for
the subsidy?
097
RICHARD EMERMAN,
PLANNER, DIVISION
OF ENERGY,
DIVISION OF
COMMUNITY AND
RURAL DEVELOPMENT,
DEPARTMENT OF
COMMUNITY AND
REGIONAL AFFAIRS
Stated that the proposal will generate $8
million dollars per year. $8 million
divided by 400 thousand would cost $20
dollars per month.
211
Mr. Emerman
Pointed out that Universal service fund to
bring down the power or 150% of statewide
average. The proposal will assume that
$6.5 million would be generated. Price
tag would be $14.6 million dollars.
280
Representative
Foster
Thanked Mr. Cotton on all the work done.
He pointed out the section of options. He
asked if on Page 4 would any of those
options work without the Governor's office
support. He asked why no one from that
office was in the Committee meeting.
390
Mr. Cotton
Executive Branch is still considering
these options.
426
Mr. Cotton
Administration is interested in
continuation of the program. There are
recommendations made by the Committee
(Blue Ribbon) to the Governor.
465
Representative
Foster
Noted that he was grateful that there is a
plan proposed.
485
Representative J.
Davies
Noted that there have been a variety of
options considered.
510
Mr. Cotton
Yes and that the General Fund endowment to
fund through 2013 year. The original
findings and intent was determined that
the Legislature would fund through the
year 2013. That was an earlier intent.
590
Mr. Cotton
The declining general funds appropriations
would use the 4 dam pool receipts, which
would extend it through 2010. There is
optimism that federal funds will be
proposed to help high cost areas
throughout America.
662
Mr. Emerman
The committee did look at a list of other
possible other sources.
695
Mr. Cotton
The universal service fund was accepted by
the committee, although, that was not the
focus.
737
REPRESENTATIVE
MARY KAPSNER
Spoke to points raised by Representative
Bunde. She reiterated that the economies
of urban and rural are interdependent.
There would be a death-spiral if the rural
communities loose PCE.
820
Representative
Austerman
Asked if the Committee went into depth
regarding the amount of money already put
into the Blue Ribbon Committee and the
benefits resulting from that.
860
Mr. Cotton
A growth analysis has not been done
specifically on that effort to reduce the
cost of power. Analysis on where the
energy has gone over the past few years.
950
Mr. Emerman
PCE brings down the cost of subsidy. + of
kilowatt-hours are eligible for support
bringing those prices down. There has
been discussion over the inflation and
adjusted cost of power over the past few
years. There has been discussion
regarding why that has occurred and
perhaps it is because of the management to
reduce the real cost of power. There has
been discussion of how low it can go.
1052
Representative
Austerman
By putting a lot of money into it, will
that help the cost?
1074
Mr. Emerman
Stated that it would reduce the incentive,
but the price to the consumer is still 2x
the level of the rest of AK. As a result,
average is about 1/2 the level of the rest
of AK.
1113
Representative
Austerman
Thought that if PCE were not funded, then
AK would find cheaper ways to use and make
electricity.
1136
Representative
Austerman
Costs associated with the 4 Dam Pool total
dollars which have gone to PCE
1160
Mr. Emerman
$281 million dollars since 1981.
1174
Representative
Austerman
Asked the costs since 1993
1185
Mr. Emerman
Estimate is $11 million dollars and 40% of
that is 11.5% and 4.5 million dollars goes
to PCE.
1225
Co-Chair Mulder
Noted that Representative Austerman will
be the subcommittee chairman of DCRA, and
that he will address this issue.
1250
Mr. Cotton
Noted that at PCE all bills are
monitored.
1262
Representative
Foster
Referenced Page 18, C-1, if the
Legislature does not address this issue,
what would the ax day be.
1289
Mr. Emerman
Replied approximately 2 months or by
August 1st.
1315
Representative
Kohring
Echoed Representative Austerman sentiments
and the positive things if it were handled
differently. He recommended infrastructure
to sustain rural AK. There are other
sources of money to tap. Establish a new
fund called the AK Energy Association.
Assess what are the needs? What are the
priority items which should be considered.
How does the State choose which are the
essential programs in the State budget.
1495
Representative
Bunde
Commented on Page7, asking if it had
benefit to rural AK at $700 per year. Has
that been a constant?
1550
Mr. Cotton
No sure but will provide that info.
1560
Mr. Emerman
Stable funding have been consistent.
1575
Co-Chair Mulder
Questioned the amount that it would take
to capitalize a fund for this program
through 2013
1602
Mr. Cotton
$75 million dollars.
1610
Co-Chair Mulder
That was the amount capitalized in 1993
1625
Mr. Emerman
It assumes that in 2013, it assumes that
money is gone, both interest and
principles.
1644
Co-Chair Mulder
Are there greater restrictions? Why would
this $75 million last longer than the 1st
$75
1670
Mr. Emerman
Assumption that more would come from the 4
Dam Pool factors and capping it at $17
million per year.
1700
Representative
Austerman
Cutting in half the amount expected to be
received.
1720
Mr. Cotton
Not everyone will be receiving it.
1730
Mr. Cotton
If fully funded, the existing formula
would receive it; although it has not been
fully funded in a number of years.
1758
Representative
Williams
Questioned how much funding has been
placed into oil throughout the State and
power grids.
1788
Mr. Cotton
Will provide that info and included
matches for many projects. That list
indicates who benefited on a per capita
basis. That info will be provided.
1821
Representative
Williams
What was it like prior to PCE funding?
1838
Mr. Cotton
A list of power grids before state
dollars.
1851
Representative
Foster
Asked Percy Frisby for his comments on the
program.
1871
PERCY FRISBY,
DIRECTOR, DIVISION
OF ENERGY,
DIVISION OF
COMMUNITY AND
RURAL DEVELOPMENT,
DEPARTMENT OF
COMMUNITY AND
REGIONAL AFFAIRS
The Division is looking at all the options
to develop alternatives. The
Administration is passing information from
the Blue Ribbon Committee. Trying to
assemble whatever the recommendations are.
1952
Representative
Williams
Has the Blue Ribbon Commission considered
a sale of the 4 dam Pool to the rural
communities.
1976
Mr. Cotton
That is a complex issue and would be a big
job and it has not been explored.
1993
Co-Chair Mulder
What is the real value of the 4 Dam Pool
2005
Representative
Moses
Only fair to look at the surcharge aspect
of the concern. There is a lot more
potential in the State, but the needs do
not make it feasible. It would take a
state match to do it. On going programs
create possibilities to use diesel fuel to
reduce the rates. In the meantime, share
the benefits and distribute the surcharge.
2079
Rep. Kasner
What is the potential of rural AK to hook
into Railbelt power.
2094
Mr. Cotton
Possibly prohibitive. There may be some
regional bulk fuel storage. Intertie
funding makes it difficult to justify.
2136
REPRESENTATIVE
ANDREW HALCRO
Questioned switching the benefit to the
user. Has there been discussion on
putting it on the user.
2166
Mr. Cotton
There has been consideration of that. He
explained the subsidy.
2184
Rep. Halcro
In 1985, looking over the history of the
PCE program, there has been no attempt to
wein the communities off the program. We
have created the subsidy and no attempt to
lessen it to subsidize.
2234
Mr. Cotton
There are ways to reduce the program by
reducing the benefits to the recipients.
2270
Mr. Cotton
Not typical of most of area is the
technology to make improvements. Bulk
fuel storage is a possibility, and the
only way to get electricity is with diesel
generator.
2305
Representative
Foster
Commented that over the last 11 years,
this is one of the most important issues,
which has ever affected Bush Alaska. He
urged the Governor to support Bush AK.
2338
ADJOURNED
Co-Chair Mulder adjourned the HFC meeting
at 3:50 P.M.
HOUSE FINANCE COMMITTEE
LOG NOTES
February 18, 1999
1 2/18/99
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