Legislature(2007 - 2008)SENATE FINANCE 532
04/30/2007 05:00 PM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB104 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 104 | TELECONFERENCED | |
| + | TELECONFERENCED |
MINUTES
SENATE FINANCE COMMITTEE
April 30, 2007
5:05 p.m.
CALL TO ORDER
Co-Chair Bert Stedman convened the meeting at approximately
5:05:37 PM.
PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Kim Elton
Senator Donny Olson
Senator Joe Thomas
Senator Fred Dyson
Also Attending: Testifiers are identified in the body of the
minutes.
SUMMARY INFORMATION
SB 104-NATURAL GAS PIPELINE PROJECT
The Committee took public testimony. The bill was held in
Committee.
5:05:42 PM
CS FOR SENATE BILL NO. 104(JUD)
"An Act relating to the Alaska Gasline Inducement Act;
establishing the Alaska Gasline Inducement Act matching
contribution fund; providing for an Alaska Gasline
Inducement Act coordinator; making conforming amendments;
and providing for an effective date."
This was the thirteenth hearing for this bill in the Senate
Finance Committee.
5:05:45 PM
Co-Chair Stedman announced that public testimony would commence.
5:07:00 PM
JIM GILBERT, President, Udelhoven Oilfield System Services,
testified via teleconference from Anchorage in support of the
expedient construction of a natural gas pipeline. He understood
that the opportunity to market Alaskan gas would not continue
indefinitely. The Alaska Gasline Inducement Act (AGIA) as
currently drafted would limit competition in the bidding
process.
5:09:50 PM
HILLARY MCINTOSH, Communications and Development Manager, Alaska
Support Industry Alliance, testified via teleconference from
Anchorage and expressed concern that the current version of the
bill did not address the risks of the State selecting the
licensee. She was an economist by education, and identified many
indications of an unsuccessful open season.
5:11:55 PM
MARY SHIELDS, General Manager, Northwest Technical Services,
testified via teleconference from Anchorage and articulated
unease that the $500 million incentive in the current version of
the bill would encourage applications from parties without the
financial strength to complete the project. She spoke of Point
Thomson as an example of the State's "disastrous record" of
selecting project winners, and stated that subjectivity should
be eliminated in the process of selecting the licensee.
5:14:21 PM
PAUL LAIRD, General Manager, Alaska Support Industry Alliance,
testified via teleconference from Anchorage to convey Alliance's
strong support for a gas project. He warned that the AGIA bill
before the Committee would not produce a gasline. Amendments
would be necessary to achieve a successful project, including
changes to the bid requirements to encourage greater competition
in the bidding process and greater fiscal predictability.
5:16:14 PM
MAYNARD TAPP, testified via teleconference from Anchorage as a
long-time Alaskan citizen. He labored on the pipeline cost study
from 2001 to 2002, and had provided written testimony [copy on
file]. He was concerned about the possibility of loss of revenue
to the State during the construction and licensing period of the
project at a time of declining oil production. He urged the
Committee to utilize the information it had and act quickly to
begin gasline negotiations.
5:18:50 PM
JERRY MCCUTCHEON, testified via teleconference from Anchorage
and requested an equal amount of time to testify as was provided
to Mid-America Oil and Gas. He criticized the gas pipeline cost
study conducted in 2001/2002 as inaccurate. He declared that a
gasline would never be built, as the gas in Alaska was needed
for oil production.
Co-Chair Stedman instructed the teleconference operator to
disconnect the testifier.
5:22:26 PM
MIKE LITTLEFIELD, Business Agent, Teamsters Local 959, testified
via teleconference from Fairbanks in support of a gas pipeline.
Speaking for the approximately 5,000 Teamsters in Alaska, he
voiced his support of AGIA, and thanked Governor Palin for
bringing the bill to the legislature.
5:25:38 PM
WILLIE LEWIS, President, Laborers Local 942, testified via
teleconference from Fairbanks and read a resolution submitted by
the NAACP [copy on file]. The resolution supported a project
labor agreement for AGIA provided that it included enforceable
language to include participation of minorities in the
construction of the pipeline.
5:29:00 PM
JOHN BROWN, International Union of Operating Engineers Local
302, testified via teleconference from Fairbanks in support of a
low tariff to ensure the State received adequate revenue and
that independent producers could ship their gas. He advocated
for a project labor agreement in AGIA with the inclusion of a
"no strike, no lock out" provision to ensure a competent work
force to build the pipeline.
5:30:51 PM
HERBIE MOSES, International Union of Operating Engineers Local
302, testified via teleconference Fairbanks in support of AGIA.
As a rural resident, he recognized the employment opportunities
associated with the pipeline construction.
5:31:40 PM
TIM SHARP, Business Manager, Alaska District Council of
Laborers, testified via teleconference from Fairbanks in support
of a project labor agreement. He predicted that AGIA may be the
State's best option to maximize the rate of return, and stressed
the importance of reliable labor and predictable labor costs.
5:32:54 PM
JOE HEGNA, Oil and Gas Sector Leader, MWH Global, testified via
teleconference from Mat-Su to recommend amendments to AGIA to
reduce the risks and ensure timely advancement of the project.
He suggested the inclusion of long term fiscal certainty for the
gas shippers and the removal of the $500 million incentive to
"let the free market determine a winner".
5:34:36 PM
TAMMIE WILSON, Fairbanks resident, testified in Juneau as a wife
and mother of union laborers, and in support of a gasline for
the benefit of Alaskans. She encouraged the inclusion of a
project labor agreement in AGIA.
5:36:20 PM
DENETTE ROMANO, Financial Adviser, Wachovia Securities,
testified via teleconference from Anchorage to express concern
regarding AGIA. As a financial adviser, she questioned the
necessity of the $500 million incentive to achieve a competitive
project. If the incentive was needed to attract investors to the
project, then the project itself was questionable.
5:39:15 PM
PAUL KENDALL, testified via teleconference from Anchorage and
characterized testimony from the oil and gas producers as "silly
talk". He encouraged the Committee to maintain a strong stance
in negotiations with producers.
5:41:49 PM
MATTHEW FAGNANI, President, Work Safe, testified via
teleconference from Anchorage. He was concerned that the current
version of AGIA would not be successful in producing a gasline.
He advised that if the gas producers were hesitant to commit
under AGIA, the legislature should consider amendments to ensure
the participation of the lease holders and resource owners.
5:43:43 PM
LYNN JOHNSON, President and Co-founder, Dowland-Bach Corporation
testified via teleconference from Anchorage that Alaska appeared
to be further away from the construction of a gas pipeline than
the State was one year ago under former Governor Murkowski. He
urged the legislature to make changes to AGIA to eliminate
exclusivity and replace prescriptive mandates with objectives,
thus addressing the needs of the gas producers and the gas
transporters.
5:46:11 PM
AVES THOMPSON, Executive Director, Alaska Trucking Association,
testified via teleconference from Anchorage to encourage
amendments to AGIA necessary to produce a gasline. He opined
that the prescriptive nature of the bill was too specific, the
$500 million incentive was unnecessary, and recommended
alternate criteria for evaluation of applications.
5:49:08 PM
JASON BRUNE, Executive Director, Resource Development Council
(RDC), testified via teleconference from Anchorage to express
RDC's support for a gasline and apprehension that AGIA would
need major amendments before it could deliver such a project.
AGIA should strive to maximize the number of bidders by allowing
flexibility, should maximize transparency in the process, and
should replace bid requirements with broad objectives.
5:51:46 PM
DAVID LAWER, President, Alaska Bankers Association, testified
via teleconference from Anchorage to encourage the Committee to
amend AGIA. He spoke to provisions such as bid requirements,
long term fiscal stability to shippers, and FERC oversight.
5:53:13 PM
PAT FALON, Laborer, Laborers Local 341 testified via
teleconference from Anchorage in support of the inclusion of a
project labor agreement in AGIA. It would allow Alaska's working
class an "honest wage and decent benefits."
5:54:13 PM
MICHAEL LAUVER, Apprentice Laborer, Laborers Local 341,
testified via teleconference from Anchorage in support of a
project labor agreement. He spoke to the education he had
received through the Local, and how that education would enable
him to provide for his family and help build Alaskan projects.
5:55:40 PM
REED CHRISTENSEN, General Manager, Dowland-Bach Corporation,
testified via teleconference from Anchorage and "echoed"
previous comments regarding the necessity of a gasline. He spoke
of record high oil prices around the world as Alaskan oil
production was declining. High oil prices seemed to have created
hostility towards oil companies, but he encouraged AGIA to
include the major producers in the gasline consideration, as the
lease holders would be a significant factor in the success of a
natural gas pipeline.
5:58:00 PM
JIM PALMER, Owner, Palmer Group, and President, Alaska Support
Industry Alliance, testified via teleconference from Anchorage
on his own behalf. He spoke of the historical context of the
natural gas pipeline. He stated that while former Governor
Murkowski's gasline proposal favored the producers, AGIA too
heavily favored the State. He also suggested the inclusion of
additional persons to evaluate applications and select a winning
bid.
6:01:02 PM
JOE MATHIS, Founding President, Alaska Support Industry Alliance
testified via teleconference from Anchorage in support of the
position of the Board of the Alliance. He recalled the
adversarial relationship between the State and the oil producers
in the 1970s, and urged the Committee to avoid the acrimony that
had characterized that era.
6:03:29 PM
MARK HYLEN, Owner, Beacon Occupational Health and Safety
Services, testified via teleconference from Anchorage to express
his concern that the State was decreasing the likelihood of the
construction of a gas pipeline. He explained that AGIA would not
generate the bids necessary for the project to progress. He
urged the Committee to remove the monetary incentive and reduce
the prescriptive nature of the bid process.
6:05:45 PM
RON AXTEL, Vice President and Business Agent, Laborers Local
341, testified via teleconference from Anchorage to implore the
Committee to support a project labor agreement in the AGIA bill
to guarantee health care benefits for Alaskan workers and their
families, thus reducing the cost to the State of care for the
uninsured.
6:07:12 PM
BILL WARREN, Retired Member, Plumbers and Pipefitters Local 367,
testified via teleconference from an Offnet location in Nikiski
in support of AGIA. He endorsed the inclusion of a project labor
agreement in AGIA. He referred to Exxon as a "cancer" in Alaska,
and warned the Committee not to give in to corporate demands.
AT EASE 6:09:25 PM/6:25:34 PM
Co-Chair Stedman closed public testimony.
ADJOURNMENT
Co-Chair Bert Stedman adjourned the meeting at 6:25:52 PM
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