Legislature(2011 - 2012)Anch LIO Rm 220
04/29/2011 09:30 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| Discussion Regarding Sb 46 Energy Projects | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
April 29, 2011
9:36 a.m.
9:36:34 AM
CALL TO ORDER
Co-Chair Stoltze called the House Finance Committee meeting
to order at 9:36 a.m.
MEMBERS PRESENT
Representative Bill Thomas Jr., Co-Chair
Representative Mike Doogan
Representative David Guttenberg
Representative Tammie Wilson
MEMBERS ABSENT
None.
ALSO PRESENT
Senator Joe Thomas
PRESENT VIA TELECONFERENCE
Representative Bill Stoltze, Co-Chair
Representative Anna Fairclough, Vice-Chair
Representative Mia Costello
Representative Bryce Edgmon
Representative Les Gara
Representative Reggie Joule
Representative Mark Neuman
Senator Olson, Senator Giessel, Sarah Fisher-Goad, Deputy
Director of Operations, Alaska Energy Authority; Peter
Crimp, Deputy Director, Alternative Energy and Energy
Efficiency, Alaska Industrial Development and Export
Authority and Alaska Energy Authority, Department of
Commerce, Community and Economic Development; Daniel R.
Fauske, CEO/Executive Director, Alaska Housing Finance
Corporation; Bob Green, Director of Research and Rural
Development, AHFC; Joe Dubler, CEO, Alaska Housing Finance
Corporation;
SUMMARY
^Discussion Regarding SB 46 Energy Projects
Co-Chair Stoltze introduced the agenda.
9:38:04 AM
SARAH FISHER-GOAD, DEPUTY DIRECTOR OF OPERATIONS, ALASKA
ENERGY AUTHORITY (via teleconference), spoke to the Alaska
Energy Authority (AEA) projects and program fund requests
in version T of the bill, with particular respect to the
governor's submitted requests to the capital budget.
Co-Chair Stoltze clarified SB 46 was currently pending
referral to the House Finance Committee. The meeting was
intended for the review of Section 4 of the bill, which
contained contentious non-severability and contingency
language which bound all energy projects in the section
together.
Representative Gara asked if version T before the committee
was the latest version of the capital budget and, did it
contain projects with split 50/50 funding between
localities and the state. Ms. Fisher-Goad replied yes. She
stated that not only was the 50 percent locality split an
issue, there was the requirement that some projects be done
using criteria under the AEA's renewable energy fund.
9:41:22 AM
Ms. Fisher-Goad discussed the AEA appropriation requests
listed in the bill. The $16,330,000 AEA Energy Program
appropriation included $330 million for the Electrical
Emergencies Program. The program had received funding in
the past several years. The program was designed to respond
to utility emergencies in rural Alaska. Ms. Fisher-Goad
stated that the $16 million dollar request for energy
projects would fund the Bulk Fuel Upgrades, Rural Power
System Upgrades (RPSU) and energy plan implementation. The
AEA had previously partnered with the Denali Commission on
the longstanding Bulk Fuel Program. The program had evolved
to incorporate more state funds versus federal dollars, as
had the RPSU program. Ten million of the $16 million
requested was state funds with the expectation that $6
million would be used for RPSU projects, $3 million for
Bulk Fuel Projects and $1 million for energy plan
implementation. The $ 1 million would help the AEA work on
a regional basis with communities to determine which
projects were necessary in each specific region. The effort
had been driven greatly by community input and local
support. The AEA was currently working in southeast on an
intergraded resource plan that would help to determine
which projects were most important to the region.
9:43:55 AM
Ms. Fisher-Goad stated that community discussions would
include the development of hydroelectric and wind power
programs in Bethel. The deputy director of rural energy
would be in charge of interfacing with communities. She
stated that the projects were community driven.
Representative Neuman expressed concern that the state was
spending money superfluously. He queried the process of
determining the areas where funds were expended. He asked
if the AEA was communicating with the utility companies
when developing projects. Ms. Fisher-Goad replied that the
AEA worked to distribute funds equitably. The Southeast
Integrated Resource Plan has specific funds appropriated
for the specific regions. Many communities were included -
she said the spending would not be dollar for dollar - but
would be needs based. She stated that the AEA had worked
closely with the railbelt utilities in developing the
Regional Integrated Resource Plan (RIRP). Many projects in
Section 4 had been put forth by the railbelt utilities that
belong to the Alaska Railbelt Cooperative Transmission and
Electric Company (ARCTEC). ARCTEC Alaska is a joint venture
project between World Technical Services, Inc. (WTSI) and
ATCO Structures and Logistics. WTSI is a subsidiary of ASRC
Federal Holding Company, the Government contracting arm of
Arctic Slope Regional Corporation and was created in
January 2009. ATCO Structures and Logistics is a
subsidiary of ATCO Group, an Alberta, Canada based company
with three main business divisions. The projects had been
identified as transition system priorities for the railbelt
area.
9:49:02 AM
Vice-chair Fairclough offered a justification for holding
the meeting in Anchorage. She reiterated that he senate had
presented in SB 46, a concept of tying approximately $460
million in projects together. She expressed the desire to
understand the perspective of the senate and voiced concern
that the Section 4 would make for an "all or nothing"
decision concerning the energy projects. She wondered if
the way in which the senate had grouped the projects
together was appropriate when discussing the energy
projects that were listed in section. She asked if the
senate version of the bill was to move forward, and
ultimately be vetoed by the governor, what would happen to
the bulk fuel upgrades and the weatherization program. She
asked if all of the projects that were listed under AEA on
Pages 100-101, had been through the same review process as
the other energy projects listed in the section.
9:52:10 AM
Ms. Fisher-Goad replied that tying the projects together
could hinder longstanding AEA programs; Bulk Fuel Upgrades,
Electrical Emergencies Program, and the Rural Power System
Upgrades (RPSU), which are vital to rural energy
infrastructure. She stated that the AEA was nearing
completion on bulk fuel projects started 10 years ago with
the Denali Commission. Typically, the AEA would design for
one year and construct for two years. Work was still being
done on the RPSU program which would require further
capital funding. Gaps in funding would result in necessary
upgrades. She stated that the department was moving forward
on the Susitna Hydroelectric Energy Plan, submitting the
Federal Energy Regulatory Commission (FERC) application.
The ability to aggressively move forward with the Susitna
project would be hindered by the unavailability of the
capital funds.
Vice-chair Fairclough wondered what kind of capacity
limitations the AEA had concerning energy projects. She
asked if the AEA had requested that all of the projects be
linked together as reflected in the current bill version.
Ms. Fisher-Goad replied that the ARCTEC projects that had
resulted from the rail utilities during the Integrated
Resource Plan (IRP) process had not been endorsed or
submitted by the AEA. However, the AEA worked together with
the utilities to develop the IRP. The projects that the AEA
owned were managed with the utilities. When ARCTEC
presented the projects to the AEA, they requested that they
come through AEA to present to the legislature. She stated
comfort with the projects being submitted through AEA,
because it would aid in the evolution of the relationship
between the utilities and AEA. The building of the robust
transmission system was important as larger projects were
pursued. The Battle Creek Diversion project and the repairs
on the Alaska Intertie were two projects owned by AEA.
Through the IRP, other projects had been identified as
important for the reparation of aging transmission lines.
Ms. Fisher-Goad believed that that AEA should be involved
in the projects listed in the bill to be sure that the
design and execution of the projects conformed to the
intent of the IRP. Several projects would repair to a
certain capacity of voltage, which had been recommended by
the IRP. Another project managers would be needed to work
with the utilities and through grants, however, internal
assessment and allocation of resources would be necessary.
She believed that it made sense for the projects to come
through the AEA and be evaluated with criteria similar to
the Renewable Energy Grant fund. Projects through the
Renewable Energy Grant were easily evaluated because they
were familiar to the AEA.
10:02:04 AM
Ms. Fisher-Goad stated that, to date, the Renewable Energy
Grant programs had been funded through the phases by
specific points of feasibility, design, and construction.
She thought several projects listed would not be ready for
the requested funds, so grant conditions could be based on
milestones. She cited the language in Section 4, Line 17:
"It is the intent of the Legislature that the state's
capital investment required to fully into any of these
energy projects not exceed 50 percent of the total
investment required to fully complete each project. The
Alaska Energy Authority (AEA) should evaluate each of the
energy projects in this section using criteria similar to
that established for the renewable energy grant fund (AS
42.45.045) by the Renewable Energy Fund Advisory committee.
If during their evaluation, AEA determines that an
appropriation exceeds the 50 percent state funding
threshold, the authority shall submit to the legislature
recommendations for reductions or reappropriation by
February 1, 2012."
Ms. Fisher Goad thought that some of the projects listed
were not appropriate under the 50 percent match
requirement.
Co-Chair Stoltze understood that under the language,
funding for energy projects that did not "pencil out",
could be reappropriated to other projects. Ms. Fisher-Goad
said that the funding would be available for
reappropriation. Ms. Fisher-Goad furthered that the
definition of, "total investment required to complete each
project.", as written in the language, was unclear. For
example, $18 million in state funds was listed for the
Mount Spur/ORMAT project. However, the project would cost
approximately $400 million to complete. She wondered how
the spending would break down dollar for dollar.
Vice-chair Fairclough asked how the AEA would prioritize
the projects that needed to be immediately implemented.
10:08:24 AM
Ms. Fisher-Goad responded that if all the requested funding
was appropriated, over 70 individual projects and grants
would need to be processed. Although the volume of the
projects was large, the department had streamlined the
development of grant agreements during the application
process. The AEA would work with the entities identified in
the section to craft a priority list of projects. She
opined that the process of creating the priority list could
be painful and tiring. Once the grants were distributed the
focus would turn to reimbursements, which are generally
submitted as the funds are spent. She stated that the AEA
worked with the Renewable Energy Advisory Board to
determine the process and criteria by which the projects
were prioritized. She said that permits and power sales
agreements would need to be in place before construction
funds would be released.
10:12:49 AM
Representative Costello said that some of the projects had
been publically vetted and that some were more recent. She
spoke about evaluating the projects a whole, and wondered
what defined good policy for evaluating energy projects for
the state. Ms. Fisher-Goad replied that AEA did not
advocate for one project over another, but would manage the
projects laid out in the budget. If the language in version
T of the bill remained, some individual projects would
require AEA to work with individual grantees. She strongly
stated that the projects would be evaluated without bias.
She highlighted that the renewable energy programs had
already been vetted by the AEA, but other programs listed
in the section, like the Homer area natural gas pipeline
project, had not. She reiterated that she did not favor one
project over another.
10:17:38 AM
Representative Costello expressed concern for the "all or
nothing" nature of the language in the bill. She asked how
Alaska would be affected if all the projects were vetoed by
the governor. Ms. Fisher-Goad replied that all the projects
were priorities for different legislators and the
communities they represent. Ms. Fisher-Goad replied that
were the projects to be cut en masse, the AEA would be
hindered in moving forward with energy programs that were
important to every region of Alaska.
Ms. Fisher-Goad believed that there were projects listed in
Section 4 that were ready for construction. Any projects
with a Federal Energy Regulatory Commission (FERC) license
were under deadline for beginning construction. She said
that state support was expected, and if the support was not
available there could be some permits and licenses in
jeopardy.
10:21:21 AM
Representative Edgmon pointed out to the committee that
there were approximately 20 projects listed that required
large appropriations. He believed after examining the
projects that they did not have the framework, and had not
been scrutinized as well as they should. He noted that many
of the projects were tied to utilities and did not have the
funding mechanisms, policy, or legal background necessary.
He felt that the state had no way to fund the projects as
they were written into the bill.
10:24:35 AM
Ms. Fisher-Goad replied that the projects in the section
that were part of the renewable energy fund were limited by
caps that had put into place prior. When the AEA set up the
request for application (RFA) applicants were informed that
if they were in a high cost area they could request up to
$4 million, with a cumulative cap. Low cost areas had a $2
million cap. She said that there was a mechanism in place
to get projects into the capital budget, and that Section 4
was one way to do it. She said that as an entity, ARCTEC
had supported some projects moving forward. She stated that
the ARCTEC projects were reasonable. She stated she was not
privy to the specific criteria employed in the choosing of
capital budget projects, or their priority listing. She
believed that there was more information on specific energy
projects available due to the establishment of the
renewable energy fund. However, the criteria used to
determine which projects made it into the budget, was
unknown to the AEA.
10:28:23 AM
Representative Edgmon asked if AEA was better suited to
prioritize the projects using established policy
guidelines. He understood that the ability to recommend
large projects did not rest with the AEA, and thought that
some projects were suspect.
10:29:47 AM
Ms. Fisher-Goad stated that the AEA was required through
legislation to solicit funds every year, and provide a
recommended list to the legislature. She stated that Round
5 of the projects would require an updated review process,
possibly removing funding caps and changing the way in
which projects were evaluated. She shared that the he
renewable energy fund will sunset in 2013. She felt that an
evaluation to determine the strengths and weaknesses of the
program, as well as any recommended changes, could be
helpful going forward. She explained that the renewable
energy program was a grant recommendation program, and that
there were 70 projects currently in the budget that had met
the AEA criteria, and had been ranked. The AEA has known of
the projects since January 2011, however, funding for the
grants would not be released until the passing of the
capital budget in July. With respect to priority - AEA
would do the projects as they were prioritized under the
established criteria. She suggested that when funds are
made available, grants should be issued for projects that
met the criteria. Historically, AEA has not been asked to
prioritize capital projects, but would if it was requested
in the future. Ms. Fisher-Goad informed the committee that
the Denali Commission programs in the bill had been
established under AEA criteria, which had been established
10 years ago. She stated that the goal was to keep moving
down the list of projects while completing the ones that
had met all the expected criteria. The AEA has a statutory
responsibility through the renewable energy fund, and is
the expected to submit capital projects established under
the organization. She offered that the AEA could work with
utilities to develop a ranking process.
10:33:20 AM
Co-Chair Stoltze mentioned that SB 42, "Power Project;
Alaska Energy Authority", laid out the multi-year process
for the energy projects. He requested further explanation
of the $17 million dollar Nuvista Light and Power projects.
PETER CRIMP, DEPUTY DIRECTOR, ALTERNATIVE ENERGY AND ENERGY
EFFICIENCY, ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT
AUTHORITY AND ALASKA ENERGY AUTHORITY, DEPARTMENT OF
COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT (via
teleconference), explained that the project was intended to
address a hydro-electric development in the Bethel. The two
projects in question are the Chikuminuk and Kisaralik
hydro-electric plants. The projects were part of the hydro
and renewable energy development projects in the South
Bethel area, and the $17 million appropriation would fund
the large scale project through the permitting process. The
department was actively working with Nuvista Power and
Light on an improved regional energy plan for, and that the
department encouraged phased funding for the projects as
part of the regional energy plan for the Lower Yukon-
Kuskoquim Region.
10:37:26 AM
Mr. Crimp calculated that a $3 million allocation could
fund the feasibility assessments and detailed technical
work need for the first year of the project. Co-Chair
Stoltze expressed dissatisfaction with the reply. He argued
that there was $483 million written into the budget back-
up. He wondered if the $483 million was being purposely
avoided. He detected and aversion to relaying project
numbers, and demanded direct and concise responses from the
testifier. Mr. Crimp replied that currently the planning
level number for the project was 483.5 million. The number
was based on preliminary work by the engineering company
Montgomery, Watson, and Harza (MWH). He stated that the AEA
would not put stock in the number until more detailed work
had been established; there was no conceptual design, the
grantee had not arrived at the proper route, potential
locations would put wildlife in danger, etc, etc. He stated
that the project number could go up or down. He stated that
there could be better projects that cost less, but it was
not easy to determine that at this point.
10:40:30 AM
Representative Gara understood that the contingency
language added by the senate had upset many house members,
but thought that enflaming tensions between the two bodies
would be counterproductive in moving forward. He stated
that in fairness it was important to recognize that the
senate had crafted the contingency language in reaction to
the governor's threat to veto projects as punishment for
not passing HB 110, the governor's oil tax bill. He thought
that the language could be removed if the house, senate,
and governor could sit down and prioritize the projects. He
believed that prioritizing the projects would make the
contingency language moot.
Representative Gara inquired about the projects in the bill
that had been vetted. He referenced the consortium ARCTEC,
previously mentioned by Ms. Fisher-Goad. He asked if all of
the ARCTEC programs had been vetted through the RIRP. Ms.
Fisher-Goad did not recall if the Cook Inlet gas study had
been included in the RIRP. She said she could not say
specifically that all the projects had been through the
RIRP, but thought that the majority of the projects had.
Representative Gara explained that the legislature, through
the RIRP, had funded Black and Veatch Corporation to review
necessary projects, and that subsequently, most of the
railbelt projects had been vetted by the legislature.
10:43:52 AM
Representative Edgmon recalled the Black and Veatch Corp
hearings. He countered that the energy projects had not
been individually vetted during that process. Ms. Fisher-
Goad replied that the transmission projects were part of
the IRP, and were listed as projects important to robust
transmission lines. Many of the projects would repair and
increase the capacity of the lines. Through the process the
AEA would ensure that the repairs made were necessary, and
that the long term aspect and intent of the IRP was
maintained.
Representative Edgmon summarized that all of the projects
listed had been recognized as necessary parts of the
railbelt affordable energy program, but they had not all
been vetted individually or ranked for priority. Ms.
Fisher-Goad responded that that was correct. She added that
the IRP was very clear that the projects had not been
prioritized because they were outside of the scope of the
IRP.
Representative Gara asserted that in his 9 years of
experience working on the capital budget, rarely would the
projects in the budget be prioritized by any independent
agency. He recapped that the RIRP had not been vetted, but
the group of renewable energy fund projects, capped at $4
million, had gone through a ranking process. Ms. Fisher-
Goad replied that certain parts of some of the renewable
energy projects had been through a ranking process, but did
not know how the projects in Section 4 would stand
individually. A list of potential projects that could be
built within the next few years had been established in
March 2011 by the AEA. She stated that some projects
through the renewable energy fund program were close to
construction through the renewable energy fund, but not
all. In 2008, at the height of energy costs, there had been
a sense of urgency with respect to identifying sensible
projects to move forward. Since then, the AEA had
established projects through the renewable energy fund that
were ready to be constructed. She clarified that projects
that were ready now could be delayed for any reason down
the line.
10:48:57 AM
Representative Gara asserted that the goal should be to
craft a list of projects that the house, senate, and the
governor could agree to. He stated that there was a series
of rural power projects located in the contingency language
in Section 4 that all exceeded the $4 million cap. He
listed several projects; the Akiak Community Generation
System Upgrade, the Copper Valley Electric Association
Hydroelectric Project, the Eva Creek Wind Farm Project, the
Gustavus Falls Creek Project, the Homer Natural Gas
Pipeline Project, each of which had been reviewed by the
legislature or received funding in the past. He argued that
the increment requests for funding could be disputed, but
either the legislature or AEA had vetted the projects.
Ms. Fisher-Goad replied that in the criteria of
establishing the renewable energy fund, the projects had
been seen. She declared that in the terms of vetting or
ranking the projects, the AEA had not been asked to manage
or issue grants. She said that if the projects were listed
in the capital budget, they were AEA priorities. If the
criteria changed, then the ranking could change depending
on the direction provided by the legislature.
10:52:24 AM
Representative Gara reiterated that most of the projects in
the contingency language section had been reviewed and had
received AEA or legislative funding in the past. He
believed it was the job of the legislature to vet the
projects with larger appropriation requests. He maintained
that the special session would not end successfully until
the governor and the two other bodies sat down and made
funding decisions together.
Ms. Fisher-Goad repeated that any application received by
the AEA was ranked, and that the funds available through
the renewable energy program were capped.
Representative Gara understood that the AEA ranked the
projects that had been sent through the renewable energy
fund, and that those funds were capped at $4 million. He
shared that in the past the legislature had funded bigger
projects that had not been sent through the renewable
energy fund, and that those projects were a legislative
prerogative for the house, senate, and the governor to
prioritize. He said that it had never been an AEA
prerogative to rank projects that did not go through the
renewable energy fund. The legislature had funded energy
projects across the state in the past without going through
the AEA. He clarified that the legislature could fund an
energy project regardless of if it had been through the
renewable energy fund, and that that was how most energy
projects in the state were funded. Ms. Fisher-Goad agreed
that the legislature had funded large, individual energy
projects in the capital budget. She pointed out to the
committee that AEA still managed the grants for some of the
projects that received funding as a legislative priority.
Vice-chair Fairclough interpreted that the reason for the
special session was a matter of process, and not because of
the projects listed in the bill. She agreed that there
could be projects that needed more discussion. She
contended that the crux of the issue was the linking
together of $460 million in energy projects that could live
or die by one red pen.
10:57:10 AM
Representative Gara clarified that he did not believe that
the senate's contingency language was necessary. He
restated the senate, the house, and the governor needed to
get together and decide which projects were necessary in
order to quell the senate's fears that the governor would
veto projects as retaliation for the senate not passing HB
110.
Co-Chair Stoltze noted that HB 110 was not on the call list
for special session.
Representative Gara felt that, in light of statements made
by the governor, the senate had a legitimate fear of the
vindictive vetoing of specific district project.
Co-Chair Stoltze questioned Representative Gara's
familiarity with the bicameral process, and suggested that
he might be better suited to represent in the senate.
Representative Gara maintained that the senate's position
was legitimate.
10:57:52 AM AT EASE
11:07:37 AM RECONVIEVE
Co-Chair Stoltze called the meeting to order. He reminded
the public that the house did not have possession of SB 46,
and that the meeting was being held with the intention of
discussing the energy projects found in Section 4 of the
bill.
DANIEL R. FAUSKE, CEO/EXECUTIVE DIRECTOR, ALASKA HOUSING
FINANCE CORPORATION (via teleconference), informed the
committee that the Weatherization and Home Energy Rebate
Programs had been in existence since 2008. The programs
received an original appropriation of $360 million, $200
million for the weatherization component, and $160 million
for the rebate program. Applicants falling under 100
percent of median income were placed in the Weatherization
Program. Applicants placing above the median were placed in
the rebate program. He declared that the program had been a
great success. The number of home raters working with the
program had increased to over 100, and the program had
serviced thousands of homes across the state. He added that
there were thousands of people on the program waiting list.
He stated that the program had benefited the community of
Barrow and all the communities across the North Slope,
particularly in lowering heating costs for the elderly. In
his original request the governor had appropriated $25
million for the program, the senate had added and
additional $26.1 million. The house had voiced concern over
how much funding needed to be appropriated to keep the
program running at its current level. He believed that the
program had improved the quality of life for Alaskan's
across the board. He asserted that the program had met, and
surpassed, all of the goals that were established in its
conception. He expounded that there were many different
energy alternatives within the state that residents could
benefit from, but using less energy should be the ultimate
goal. He said that programs that helped to accomplish
energy savings should be embraced.
11:12:56 AM
Mr. Fauske explained that the work generated by the program
was technical, but minimal. Essentially, the work to the
home was done by homeowners and then analyzed by experts.
Certain funding levels would determine the wait on the wait
list, and how many homes that could be visited on a weekly
basis.
BOB GREEN, DIRECTOR OF RESEARCH AND RURAL DEVELOPMENT,
ALASKA HOUSING FINANCE CORPORATION (via teleconference),
testified that the $360 million appropriated to the program
in 2008-09, helped to provide energy efficient improvements
in over 17,000 homes throughout the state. The boost from
$4.8 million to $360 million in funding allowed the AHFC to
create partnerships with other state agencies. Before the
additional funding, the Weatherization Program had 5
contractors working statewide to the tune of $5 million.
After the funding increase, the corporation was able to
bring all the regional housing authorities in the state on
as additional contractors, raising the total contractors
servicing the state from 5 to 20. Currently, the program
had reached capacity, and over 4000 homes were expected to
benefit from the Weatherization Program in 2011. Higher
income homeowners could do energy efficiency improvements.
The maximum rebate issued for the Home Energy Rebate
Program was $10,000. In addition to the 17,000 homes that
had been made more energy efficient statewide, 3,500
households had applied and were waiting to make refundable
improvements. The homeowner has 18 months to complete the
improvements, a post-assessment is then performed on the
home, and the rebate was then calculated accordingly.
Sophisticated software was used to measure energy
improvements both for weatherization and the energy rebate
program. Because the cost of energy can vary from day to
day, energy savings were targeted instead of energy cost.
There were 3500 applicants in the pipeline for the rebate
program. Because the waitlist continued to grow, and the
funds were obligated, any future funding for the program
was not secure. 40 names were being dispatched per week. He
shared out of respect for available funds; the list had
been slowed down. Reported data showed that the programs
savings averaged between $1550 and $1600, per year, per
home. He stated that the average rebate payout was slightly
over $6,000, while the average amount that homeowners were
spending on improvements was $10,000.
11:21:56 AM
Vice-chair Fairclough divulged that she had spent over
$13,000 on home energy improvements, had received her
rebate, and now had a 5 star home. She expressed concern
that the Weatherization Program was among the programs tied
together in Section 4. She asked if the AHFC was concerned
that the Weatherization Program was included in the Section
4 contingency language. Mr. Fauske replied that he believed
that the program should be funded in perpetuity, possibly
through an endowment, and that it should be a top priority
for the state. He stressed that the program was producing
immediate positive results, and adding dollars to the
economy statewide. He strongly believed that losing the
program would be detrimental for all state residents. If
funding were shut off the program would end in April of
2012. If the cap funding were to pass the program could
extend for possibly a year after that. He understood that
there was a contentious debate going on within the
legislature, and hoped for a resolution so the program
could continue to serve Alaskans.
Vice-chair Fairclough related that the program had resulted
in a savings of $1,200 annually for her family.
Representative Gara queried how much it would cost to keep
the program running at its currently capacity. Mr. Fauske
replied $100 million would keep the program dispatching at
its current level for one year. Representative Gara
reminded the committee that Senator Stedman had expressed
the willingness to remove the Weatherization Program and
the Home Energy Rebate Program from the contingency
language in Section 4.
11:28:32 AM
Representative Guttenberg expressed concern that there were
not enough raters working in the field. Mr. Fauske
responded that the raters worked under private contract. He
added that raters had expressed concern for less work in
the future due to lack of funding. He warned that if
funding for the program were to end, 98 active raters would
be without work. He thought that the number of active
raters would increase with continued funding.
Mr. Brean interjected that if funds were not appropriated
for the programs the applicants in the system would be
processed and then the programs would be phased out.
Representative Joule hoped the program would continue. He
mentioned that some people in the state were taking energy
problems to the private level by developing public/private
partnerships, and involving younger Alaskan's at a
community service level. Mr. Brean shared that one element
of both programs was the Training and Technical Assistance
component. The component allowed for community training in
technical assistance. Grant funds for education were also
available in order to perform work locally and retain local
funds.
Representative Joule queried what the private partner's
responsibility consisted of. Mr. Brean replied that
Representative Joule's region was more active than others.
The list of private partners was long, and the two programs
that had positive impact on all aspects of industry, from
sales to builders and designers, in local areas. The
private partner's consistently displayed the willingness to
underwrite activities that the AHFC embarked upon, and to
sponsor various trainings around the state.
11:36:42 AM
Mr. Fauske shared that a minimum of 2,500 jobs had been
created or retained by the program, and that number could
be upwards of 4,000.
Representative Doogan pointed out to the committee the $5.5
million for the Gasline Development Corporation. He
wondered what the funds would be used for. Mr. Fauske
replied that the funds would go toward ongoing work
concerning engineering, summer field work, and the
environmental impact statement. He said that the $5.5
million was part of an overall group of funds that had been
requested. The governor had placed $5.5 million in the
capital budget with the understanding that there would be
debate during the legislative session which might result in
more funding. The AHFC had requested that the $1 million
that had lapsed be reappropriated by the legislature, and
had made a $6.2 million dollar request in the supplemental.
As the corporation became more familiar with the process,
another $15.5 million had been requested in the capital
budget, bringing the total to $28.2 million, which included
the $5.5 million.
Representative Doogan requested more clarification. Mr.
Fauske replied the $6.2 million was requested because of
new information pertaining to summer field work. The
request was originally intended for the supplemental budget
so that work could continue through July 1, 2011.
JOE DUBLER, VICE PRESIDENT/CHIEF FINANCIAL OFFICER, ALASKA
GASLINE DEVELOPMENT CORPORATION (via teleconference)
discussed the $5.5 million request in the governor's
request. The request had included amounts that would be
used for commercial and financial analysis. Also included
were RSA's with the Department of Natural Resources and the
Department of Environmental Conservation for permitting and
environmental impact statement work, totaling $1.4 million.
He stated that $2.2 million would be used for personnel and
operating costs. The remaining $7.2 million, which was to
be in the supplemental, would fund engineering,
environmental, and regulatory field work. Co-Chair Stoltze
requested a summary of the funding plan in written form be
submitted to the committee.
Representative Guttenberg asked why the project was listed
as (HD 12-35) in the bill on page 110.
Vice-chair Fairclough stated that the listing designating
the district was the result of the staff that had drafted
the bill. She said that the listing could be changed if
necessary.
Representative Wilson wondered how the program would be
affected in the event that the contingency language went to
court. Mr. Fauske replied that without funding for the
program, the program would be shut down.
11:46:02 AM
Representative Wilson understood that if the language went
to court the program would be affected for years to come.
Mr. Fauske warned that if funding were denied the contract
work necessary for the function of the program would we
negatively affected.
11:47:37 AM
ADJOURNMENT
The meeting was adjourned at 12:01 PM.
| Document Name | Date/Time | Subjects |
|---|