Legislature(2001 - 2002)
12/19/2001 10:12 AM House L&C
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* first hearing in first committee of referral
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+ teleconferenced
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ALASKA STATE LEGISLATURE
HOUSE LABOR AND COMMERCE STANDING COMMITTEE
December 19, 2001
10:12 a.m.
COMMITTEE CALENDAR
UPDATE: FOUR DAM POOL DIVESTITURE
TAPES
01-74, SIDE A
CALL TO ORDER
REPRESENTATIVE LISA MURKOWSKI, Chair, convened the House Labor and
Commerce Committee meeting at 10:12 a.m.
PRESENT
Committee members present were Representatives Murkowski, Halcro,
and Rokeberg.
SUMMARY OF INFORMATION
CHAIR MURKOWSKI stated that the purpose of the day's meeting was to
evaluate the status of the Four Dam Pool divestiture set to be
complete December 31, 2001.
THERESA OBERMEYER, citizen, interrupted the meeting to discuss
matters unrelated to the Four Dam Pool divestiture.
DAVE CARLSON, Divestiture Project Coordinator for Four Dam Pool,
stated his pleasure to have the opportunity to update the committee
on the progress they've made since the September 12, 2001, House
Labor and Commerce Committee meeting. Mr. Carlson introduced Walter
Sapp, Chairman of the Kodiak Electric Association and stated Mr.
Sapp would be available for any questions.
MR. CARLSON reported that the group has made tremendous progress on
all fronts. The memorandum of understanding outlines a closing date
of December 31, 2001, and everything seems to be on schedule. Final
closure depends on approval from governing bodies of the local
utilities, which are of the cities of Wrangell, Petersburg,
Ketchikan, Copper Valley, and Kodiak Electric Associations. Mr.
Carlson noted that this has been a very complex transaction with
documents that are complex and voluminous. He offered his thanks to
the governing bodies for educating themselves on this topic and
approving it with ease.
MR. CARLSON mentioned that the governing bodies are in various
stages of approval of the final divestiture. The city of Wrangell
has completely signed off, Petersburg has passed it in its second
reading. Third and final reading will occur December 27, 2001. The
city of Ketchikan passed their first reading last week and will
continue with second reading later this month, or if they can't get
a quorum this month, they will meet the first Thursday in January.
Copper Valley is having a work session tonight (December 19, 2001).
Kodiak will take action tomorrow (December 20, 2001). Mr. Carlson
noted that Ketchikan will be the only outstanding governing body,
but because it is in the process of approval there won't be any
problems meeting the necessary deadline.
MR. CARLSON stated that the Alaska Energy Authority (AEA) and
Alaska Industrial Development and Export Authority (AIDEA) have
approved the purchase and sale agreement as well as the loan and
security agreement. Official closing will occur 30 days after
Ketchikan passes their ordinance in second and last reading. The
Federal Energy Regulatory Commission (FERC) licensing transfer
process should go quickly without any problems. Mr. Carlson gave
thanks to Bob Poe, Director of AIDEA and AEA for his cooperation.
MR. CARLSON noted that because of recent interest rate cuts,
reinvestment rates are in the 2.5 to 3 percent range. If the agency
does not get the letters of credit to make up for the negative
arbitrage they'll have to borrow from the state to make up the
difference. The agency is currently working on acquiring insurance
for the project but insurance companies have been depressed since
the September 11 events. He noted that gaining insurance has been
difficult and more expensive than anticipated.
MR. CARLSON gave thanks to the congressional delegation for helping
the agency gain a governmental entity status, which exempts them
from federal income taxes. He closed his remarks by stating that
everything seems to be going well and he does not foresee any
events that prevent the governing bodies from approving divestiture
of the Four Dam Pool power project.
ANNOUNCEMENTS
There were no committee announcements.
COMMITTEE ACTION
The committee took no action.
ADJOURNMENT
There being no further business before the committee, the House
Labor and Commerce Standing Committee was adjourned at 10:45 a.m.
NOTE: The meeting was recorded and handwritten log notes were
taken. A copy of the tape(s) and log notes may be obtained by
contacting the House Records Office at State Capitol, Room 3,
Juneau, Alaska 99801 (mailing address), (907) 465-2214, and after
adjournment of the second session of the Twenty-Second Alaska State
Legislature this information may be obtained by contacting the
Legislative Reference Library at (907) 465-3808.
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