Legislature(2007 - 2008)SENATE FINANCE 532
08/02/2008 09:00 AM Senate FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB4002 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB4002 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
August 2, 2008
9:28 a.m.
CALL TO ORDER
Co-Chair Stedman called the Senate Finance Committee meeting
to order at 9:28:56 AM.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Charlie Huggins, Vice-Chair
Senator Kim Elton
Senator Donny Olson
Senator Joe Thomas
Senator Fred Dyson
MEMBERS ABSENT
None
ALSO PRESENT
David Teal, Director, Legislative Finance Division; Darwin
Peterson, Staff, Co-Chair Stedman; Sarah Fisher-Goad, Deputy
Director of Operations, Alaska Industrial Development and
Export Authority and Alaska Energy Authority, Department of
Commerce, Community and Economic Development; Randall Ruaro,
Special Assistant, Office of the Governor; Miles Baker,
Staff, Co-Chair Stedman; Amanda Ryder, Director of
Administrative Services, Department of Commerce, Community
and Economic Development; Senator Gary Stevens; Senator
Bettye Davis; Senator Lesil McGuire; Senator Lyda Green;
Senator Johnny Ellis; Senator Bill Wielechowski;
PRESENT VIA TELECONFERENCE
None
SUMMARY
SB 4002 "An Act establishing the Alaska resource rebate
program and relating to the program; and providing
for an effective date."
CSSB 4002 (FIN) was REPORTED out of Committee with
a "do pass" recommendation and with three new
Senate Finance Committee fiscal notes.
9:29:01 AM
SENATE BILL NO. 4002
"An Act establishing the Alaska resource rebate program
and relating to the program; and providing for an
effective date."
Co-Chair Stedman reported that the details of SB 4002 and
its companion appropriation bill remain to be worked out.
He said that Power Cost Equalization (PCE) would be
addressed within the bill.
9:31:31 AM
Co-Chair Hoffman MOVED to ADOPT CSSB 4002, labeled 25-
GS4057\T, Finley/Cook, 8/1/08. There being NO OBJECTION, it
was so ordered.
9:32:06 AM
DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION, referred
to a handout entitled "Power Cost Equalization Program - FY
09 Costs under Various Assumptions" (copy on file.) He
explained that it compares the House and Senate versions of
the bill. The current floor rate for PCE is 12.83 cents,
computed by using the average rates of Anchorage, Fairbanks,
and Juneau. SB 4002, which provides for a two-year program,
sets the floor rate for PCE at 10 cents. There is also a
subsidy for costs that exceed the floor, up to the ceiling
rate of $1.15. The maximum subsidy available is $1.05. In
addition, there are utilities which would not qualify for
money under the PCE program, but which would qualify for an
alternative distribution - at a minimum of 5 cents. It
assumes rates in rural areas in FY 09 would increase by 50
percent. In urban areas the assumed rate increase is 5
percent.
9:35:50 AM
Mr. Teal explained program costs. The $64 million amount is
for those utilities currently on the PCE program.
Senator Elton asked about the per kilowatt hour payment to
new utilities. He wondered about the definition of new
utilities.
Mr. Teal referred to page 6 which lists the new utilities
that are currently ineligible because they are too large.
There is a cutoff for eligibility of 7,500 megawatts in
production. There is also a clause which prohibits a four
dam pool utility. The bill repeals both of those
eligibility restrictions and makes all utilities in the
state eligible for PCE. Senator Elton summarized that it
affects new utilities that are being added to the program.
Mr. Teal said that is correct.
9:37:37 AM
Mr. Teal related that virtually all utilities would pay 10
cents. Others would pay 16 cents, even for the first 500
kilowatts. The urban rate - for newly qualified utilities -
would be 10 cents or lower. The current program in the
rural area would be for about $270. This program drops it
to $177. In each case there is a reduction. In the rural
areas it could be more substantial.
9:39:36 AM
Mr. Teal referred to page 6 to explain the 5 cent reduction.
Under PCE the rate would fall to 10 cents for utilities not
currently eligible for PCE. The "bottom line" information
is on page one. The $21 million for community facilities
complies with current law and is a reduction in the
community's electric bill.
Co-Chair Stedman asked what could be included as part of
"community facilities". Mr. Teal said the city hall or any
community-owned facility could qualify. It does not include
schools or commercial businesses.
Co-Chair Stedman requested an explanation of the dispersal
of the $21 million. Mr. Teal explained that the community
would receive an electric bill and then get it reduced by
the utility.
9:42:22 AM
DARWIN PETERSON, STAFF, CO-CHAIR STEDMAN, explained the
changes in the new CS to SB 4002. He related that the
energy package is a three-legged stool: PCE, resource
rebate, and emergency energy relief - a heating oil subsidy.
Co-Chair Hoffman pointed out that the key factor is that the
programs are for two years so that Alaskans can count on
energy relief and so that the legislature can work on long-
term solutions.
9:45:17 AM
Mr. Peterson added that the resource rebate is a one-time
payout.
Mr. Peterson referred to page 4, a change in Section 7,
which deals with the resource rebate. It allows for
veterans who don't apply for the Permanent Fund Dividend
(PFD) to be eligible for the program.
Mr. Peterson turned to page 5, Section 8, the energy relief
portion of the bill. Lines 19-22 incorporate Senator
Elton's ideas about the reimbursement of the sales tax paid
on heating oil.
Mr. Peterson reported that page 6, lines 3-8, is new
language that requires landlords to pass on the savings from
the resource rebate to renters on a pro rata basis. Failure
to do so is a violation of AS 45.50.471, which is the
Unlawful Trade Acts and Practices statute.
9:47:01 AM
Mr. Peterson moved on to page 6, line 25, where the
requirement that a business that sells fuel oil has to be a
qualified distributor was deleted. He gave an example of an
area in rural Alaska where this would apply.
Mr. Peterson turned to page 6, line 27, through page 7, line
3, to describe "anti-gouging" language to prevent
distributors from artificially inflating prices in response
to the new program.
Mr. Peterson detailed on page 9, lines 2-4, a technical
change in the criminal section. It makes it a Class A
misdemeanor for someone to use fuel that has been reimbursed
for this program for purposes other than a primary residence
or for a building that is owned by a government entity.
9:48:47 AM
Senator Dyson assumed it was inappropriate to use fuel for
boats or vehicles. Mr. Peterson said that the language is
clear that fuel must be used for primary residences.
Co-Chair Stedman asked about a live-aboard's ability to
access 600 gallons of fuel for their boat. He offered to
check on that issue.
9:50:01 AM
Co-Chair Hoffman thought that if the number was
substantially higher than 600 gallons, it could be
considered abuse.
Senator Huggins wondered where the language referring to
senior housing was. Mr. Peterson said there was no language
specific to that issue. If the housing is owned by Alaska
Housing Finance Corporation it would not qualify.
Senator Huggins noted that seniors in his district need some
benefit also.
9:52:07 AM
Senator Olson asked about the resource rebate as it applies
to North Slope Borough residents. Mr. Peterson agreed that
those residents would not qualify.
Senator Olson voiced concern about his constituents not
benefitting by this legislation.
Senator Olson asked if there are any changes in the CS
regarding Power Cost Equalization as it relates to the North
Slope Borough. Mr. Peterson deferred to Ms. Fisher-Goad.
9:54:33 AM
SARAH FISHER-GOAD, DEPUTY DIRECTOR OF OPERATIONS, ALASKA
INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY AND ALASKA
ENERGY AUTHORITY, DEPARTMENT OF COMMERCE, COMMUNITY AND
ECONOMIC DEVELOPMENT, said the North Slope Borough has a
subsidized rate of 15 cents per kilowatt hour, so they would
qualify for the 10 cents per kilowatt hour rate.
Ms. Fisher-Goad commented on a previous question regarding
eligible community facilities. Eligibility would be
determined by AEA. Those facilities would not be eligible
if they are owned by federal or state entities. City-owned
facilities would qualify and would share in a collective
amount of kilowatt hours.
9:57:26 AM
Senator Huggins questioned categories of senior housing
program eligibility. Ms. Fisher-Goad said that non-profit
senior housing would qualify. She referred to page 6, line
3, to explain that it if they are not governmentally owned,
they would qualify.
Senator Huggins needed a definitive answer. He gave an
example of ten seniors and questioned if the residents would
be eligible. Ms. Fisher-Goad thought that each unit in a
multi-family building would be eligible for up to 300
gallons of fuel. The owner could pass on the savings to the
tenants.
Senator Huggins asked for location of the 300 gallon
reference. Ms. Fisher-Goad said page 5, line 25.
10:01:00 AM
Senator Dyson appreciated the line of questioning. He
assumed that non-profits would also qualify. He wanted
assurance that those were intrinsic in the bill.
Mr. Peterson explained that the legislation now states that
"a person" would be eligible. That definition is a
corporation, company, partnership, firm, association,
organization, business, trust, or society, as well as a
natural person. A non-profit would qualify; a purely
government-owned building would not.
10:03:32 AM
Senator Huggins asked for the administration's view.
RANDALL RUARO, SPECIAL ASSISTANT, OFFICE OF THE GOVERNOR,
could not state the administration's position on the bill.
Senator Huggins thought it was important to work together
with the administration on the bill. Mr. Ruaro noted that
the Department of Law has been working on the bill.
Co-Chair Stedman requested that information in a timely
manner.
10:05:23 AM
Co-Chair Hoffman referred to page 4 - the resource rebate -
and thought there should be further dialogue on that issue.
He questioned what the preferences of the Committee and the
legislature are, and what the expectations of Alaskans are
regarding the resource rebate.
Senator Huggins asked for the total cost of the bill. Co-
Chair Stedman said the staff is working on the fiscal note.
AT-EASE: 10:06:24 AM
RECONVENE: 10:11:02 AM
Co-Chair Stedman addressed Senator Huggins' question
referring to the fiscal note. The new fiscal note is dated
8/2/08, 9:30 AM.
Co-Chair Hoffman noted that the $140 million is directly
related to the PCE program.
Co-Chair Stedman added that the home heating cost is $173
million. The addition of the rebate to the PFD costs about
$155 million, plus $500,000 for administering the hold
harmless component. The total is roughly $468 million.
Co-Chair Hoffman termed it "a good start".
Co-Chair Stedman summarized that total cost was slightly
under $500 million.
10:12:58 AM
MILES BAKER, STAFF, CO-CHAIR STEDMAN, directed the
Committee's attention to three fiscal notes. The most
recent one is for PCE changes and is dated 8/2/08. On all
the fiscal notes, the appropriation required column is blank
because they are funded through an appropriation bill.
Based on proposed changes, an additional $140,775,000 would
have to be appropriated into the PCE fund. There is already
$28 million in that fund. He reported that the total
program cost is $168,800,000 as reflected in the 2010
column. In 2011 the amount drops back to the current
funding level of $32,603,000. He explained the fund source
column, which contain AEA's projections. The expectation is
that $25.8 million can be pulled from the fund yearly.
10:15:53 AM
Mr. Baker explained the Department of Revenue fiscal note,
dated 7/31/08, written to Version L, for $155.1 million. It
is the cost of the $250 additional payment added to the PFD.
It is based on 622,000 Alaskans receiving the rebate, plus
administrative costs.
Mr. Baker explained the Department of Commerce, Community
and Economic Development fiscal note for $172,889,000 for
home fuel assistance for two years, dated 7/31/08. It is an
estimated cost for providing the fuel rebate.
Mr. Baker reported that the total of the three fiscal notes
is just shy of $500 million.
10:18:13 AM
Senator Elton noted that there was a financial obligation of
about $450 million for FY 2010. Mr. Baker responded that it
was about $400 million. Senator Elton thought the total
cost of the bill would be about the same as the Governor's
bill. Co-Chair Hoffman reminded the Committee that the new
programs are for two years.
Co-Chair Stedman pointed out that more work was needed on
the rebate.
AT-EASE: 10:21:06 AM
RECONVENE: 3:28:10 PM
Co-Chair Stedman reported that there were several
amendments.
Senator Olson MOVED to ADOPT Amendment 6:
Page 4, line 15, following "persons":
Insert "and municipalities"
Page 5, line 15, following "person":
Insert "or municipality"
Page 5, line 16, following "person":
Insert "or municipality"
Page 5, line 30, following "person":
Insert "or municipality"
Page 7, line 11, following "person":
Insert "or municipality"
Page 7, line 11, following "person's":
Insert "or municipality's"
Page 7, line 15, following "person":
Insert "or municipality"
Page 7, line 17, following "person" in both places:
Insert "or municipality" in both places
Page 7, line 18, following "person":
Insert "or municipality"
Page 8, line 25, following "person":
Insert "or municipality"
Co-Chair Stedman OBJECTED.
Senator Olson explained that Amendment 6 inserts the words
"and municipalities" in a number of places throughout the
bill. He explained the North Slope Borough's fuel
assistance program. The amendment takes that into account
and makes for a more equitable situation. He quoted
statistics about price versus oil usage over the past year
in the borough. He reported that there were 670 households
in his borough and it would take $1 million to include those
people in the rebate.
3:31:58 PM
Senator Elton listed three ways to deal with this issue:
accept the current version of the bill, adopt the amendment,
or for the Borough to end its subsidization program.
Senator Olson said those were theoretical ways. He spoke
against dismantling the subsidy program. He suggested that
the most considerate way to deal with this situation would
be to adopt the amendment.
A roll call vote was taken on the motion.
IN FAVOR: Dyson, Olson, Thomas
OPPOSED: Elton, Huggins, Stedman
Co-Chair Hoffman was absent for the vote.
The motion failed 3-3.
3:33:41 PM
Senator Thomas MOVED to ADOPT Amendment 9:
Page 1, line 1, following "Act":
Insert "relating to grants from the renewable energy
grant fund;"
Page 1, following line 7:
Insert new bill sections to read:
"* Section 1. AS 42.45.045(e), as enacted in sec. 3,
ch. 31, SLA 2008, is amended to read:
(e) In consultation with the advisory committee
established in (i) of this section, the authority shall
make recommendations to the legislature regarding
eligible applicants' projects that finance feasibility
studies, reconnaissance studies, energy resource
monitoring, and construction of renewable energy
projects, alternative energy projects, natural gas
projects, or transmission or distribution
infrastructure located in Alaska that meet the
requirements of (f), (g), [OR] (h), or (m) of this
section, as applicable, and shall, at least once each
year, solicit from the advisory committee funding
recommendations for all grants.
* Sec. 2. AS 42.45.045(k), as enacted in sec. 3, ch.
31, SLA 2008, is amended to read:
(k) The legislature may appropriate money for
grants from the renewable energy grant fund for
[RENEWABLE ENERGY] projects described in this section.
* Sec. 3. AS 42.45.045, as enacted in sec. 3, ch. 31,
SLA 2008, is amended by adding a new subsection to
read:
(m) For an alternative energy project to qualify
for a grant recommendation under (e) of this section,
the project must be a
(1) new project not in operation on the
effective date of this bill section or an addition to
an existing project made after the effective date of
this bill section; and
(2) facility that generates energy or fuel
that is less expensive, more efficient, or has a less
adverse effect on the environment than the energy or
fuel that was previously used by a community."
Page 1, line 8:
Delete "Section 1"
Insert "Sec. 4"
Renumber the following bill sections accordingly.
Page 2, line 4:
Delete "sec. 1"
Insert "sec. 4"
Page 3, line 20:
Delete "sec. 4"
Insert "sec. 7"
Page 4, following line 9:
Insert new bill sections to read:
"* Sec. 9. The uncodified law of the State of Alaska
enacted in sec. 1(b), ch. 31, SLA 2008, is amended to
read:
(b) It is the intent of the legislature that each
year for the next five years $50,000,000 in capital
funds be appropriated to fund renewable energy projects
recommended by the Alaska Energy Authority as described
in AS 42.45.045(f) and sec. [SECS. 3 AND] 6 of this
Act.
* Sec. 10. The uncodified law of the State of Alaska
enacted in sec. 6, ch. 31, SLA 2008, is amended to
read:
RENEWABLE ENERGY GRANTS DURING STATE FISCAL YEAR
2009. (a) For the fiscal year ending June 30, 2009,
from an appropriation made under the statement of
intent set out in sec. 1(b) of this Act, the Alaska
Energy Authority shall distribute grants to applicants
determined by the authority and that meet the criteria
in AS 42.45.045(f) - (h) and (m) [, ADDED BY SEC. 3 OF
THIS ACT,] based on the procedure described in (b) of
this section.
(b) For administering grants under
AS 42.45.045(f) - (h) and (m) [, ADDED BY SEC. 3 OF
THIS ACT,] for the fiscal year ending June 30, 2009,
notwithstanding AS 42.45.045(d), (e), and (i) - (l),
added by sec. 3 of this Act,
(1) the Alaska Energy Authority shall submit
to the Legislative Budget and Audit Committee for
review a revised program setting out the proposed
grants;
(2) 45 days shall elapse before commencement
of expenditures under the revised program unless the
Legislative Budget and Audit Committee earlier
recommends otherwise;
(3) should the Legislative Budget and Audit
Committee recommend within the 45-day period that the
Alaska Energy Authority not award the grants as set out
in the revised program, the Alaska Energy Authority
shall again review the grant applications and, if the
Alaska Energy Authority determines to authorize the
expenditures, the Alaska Energy Authority shall provide
the Legislative Budget and Audit Committee with a
statement of the Alaska Energy Authority's reasons
before commencement of expenditures making the approved
grants."
Renumber the following bill sections accordingly.
Page 4, line 14:
Delete "sec. 7"
Insert "sec. 12"
Page 4, line 15:
Delete "sec. 8"
Insert "sec. 13"
Page 9, line 13:
Delete "Sections 8(a), (b), (d) - (f), (i) - (o), and
(q)"
Insert "Sections 13(a), (b), (d) - (f), (i) - (o), and
(q)"
Page 9, line 15:
Delete "Sections 2 and 5"
Insert "Sections 5 and 8"
Page 9, line 16:
Delete "Sections 1, 3, 4, 9, and 10"
Insert "Sections 4, 6, 7, 14, and 15"
Page 9, line 17:
Delete "Sections 6 - 8"
Insert "Sections 1 - 3 and 9 - 13"
Co-Chair Stedman OBJECTED.
Senator Thomas explained that the amendment adds alternative
fuel and power projects to existing statute. The intention
is that it would require those projects to go through the
same process as the renewable projects do.
Senator Thomas reported that not all areas of the state have
access to the same types of power generation and/or energy
resources. He argued for the inclusion of alternative
energy projects.
Senator Thomas referred to page 1, lines 10 and 11, which
adds alternative energy projects to the list.
Co-Chair Stedman MAINTAINED his OBJECTION.
3:35:31 PM
Senator Dyson asked what is included in alternative energy
projects. He specifically inquired about fish waste, lumber
waste, and clean coal.
Senator Thomas explained the definition of alternative
energy projects on page 1, lines 20 - 23, and page 2, lines
1 - 4. They include those projects defined by AEA. It does
not affect the $50 million already appropriated for
renewable energy projects; it looks forward to future money.
Senator Elton recalled a previous debate where renewable
energy was carefully defined. It did include biomass and
wood and fish waste. The major effect of the amendment
would be the addition of coal. He said he was opposed to
voting on it now because of a pending, comprehensive energy
plan. He suggested waiting for that plan.
3:38:50 PM
Senator Olson questioned whether the amendment requires a
fiscal note. Senator Thomas explained that it does not
appropriate any money.
Senator Huggins echoed Senator Elton's comments.
Co-Chair Stedman shared the same view.
Senator Thomas said the amendment was just an addition to
the language to allow the consideration of other energy
projects.
3:40:52 PM
A roll call vote was taken on the motion.
IN FAVOR: Olson, Thomas, Dyson
OPPOSED: Elton, Huggins, Stedman, Hoffman
The motion failed 3-4.
3:41:45 PM
Co-Chair Hoffman MOVED to ADOPT Amendment 7:
Page 1, line 1, following "Act":
Insert "amending the bulk fuel bridge loan fund;"
Page 1, following line 7:
Insert a new bill section to read:
"* Section 1. AS 29.60.660(c) is amended to read:
(c) Loans made from the bulk fuel bridge loan
fund to one borrower in a fiscal year
(1) may not exceed $750,000 [$500,000]; and
(2) shall be repaid within one year after the
date of the award."
Page 1, line 8:
Delete "Section 1"
Insert "Sec. 2"
Renumber the following bill sections accordingly.
Page 2, line 4:
Delete "sec. 1"
Insert "sec. 2"
Page 3, line 20:
Delete "sec. 4"
Insert "sec. 5"
Page 3, following line 9:
Insert a new bill section to read:
"* Sec. 7. AS 42.45.250(e) is amended to read:
(e) Loans made from the bulk fuel revolving loan
fund to one borrower in any fiscal year
(1) may not exceed $750,000 [$500,000], or,
if the borrower is a cooperative corporation organized
under AS 10.15 or an electric cooperative organized
under AS 10.25 and uses the loan to purchase bulk fuel
on behalf of more than one community, may not exceed
the lesser of $750,000 [$500,000] multiplied by the
number of communities on whose behalf the bulk fuel is
to be purchased, or $1,800,000;
(2) shall be repaid in one year or less; and
(3) may not exceed 90 percent of the
wholesale price of the fuel purchased."
Renumber the following bill sections accordingly.
Page 4, line 14:
Delete "sec. 7"
Insert "sec. 9"
Page 4, line 15:
Delete "sec. 8"
Insert "sec. 10"
Page 9, line 13:
Delete "Sections 8(a), (b), (d) - (f), (i) - (o), and
(q)"
Insert "Sections 10(a), (b), (d) - (f), (i) - (o), and
(q)"
Page 9, line 15:
Delete "Sections 2 and 5"
Insert "Sections 3 and 6"
Page 9, line 16:
Delete "Sections 1, 3, 4, 9, and 10"
Insert "Sections 2, 4, 5, 11, and 12"
Page 9, line 17:
Delete "Sections 6 - 8"
Insert "Sections 1 and 7 - 10"
Co-Chair Stedman OBJECTED.
3:42:30 PM
AMANDA RYDER, DIRECTOR OF ADMINISTRATIVE SERVICES,
DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC DEVELOPMENT,
explained the impact of Amendment 7, which would increase
the cap for the bulk fuel bridge loan fund to $750,000. The
impact will add about $2.5 million to the need of the
program.
AT-EASE: 3:43:31 PM
RECONVENE: 3:43:56 PM
Ms. Ryder continued to explain Amendment 7. The bridge loan
fund has zero percent interest loans. There are about 16
outstanding loans. Inquiries for six more loans have been
received and more are expected.
Senator Dyson asked for further clarification of the
amendment.
Ms. Ryder reported that the amendment would change statute
and amend two existing programs, and it adds a new section
to version T of the bill.
Senator Dyson asked if the bill would be renumbered. Ms.
Ryder clarified that the amendment changes two existing loan
funds and is not related to the PCE program.
Co-Chair Stedman added that the reason for the amendment is
to put a ceiling on the loan program due to rising costs of
fuel. Ms. Ryder stated that more communities are expected
to need loans due to the rising price of fuel. Funding for
the bridge loan fund can only be received if the communities
have been denied the bulk fuel loan fund by AEA.
3:47:01 PM
Senator Huggins asked how often the bridge loan fund is
exercised and what the delinquency record is. Ms. Ryder
reported that there has been no delinquency on the 16 loans.
Senator Huggins asked if she was in support of the
amendment. Ms. Ryder related that she has had communication
with the director of Community and Regional Affairs, who
supports the idea of obtaining additional funds.
Senator Olson asked if the 16 outstanding loans were under
the bridge loan fund. Ms. Ryder said yes.
Co-Chair Stedman WITHDREW his OBJECTION. There being NO
OBJECTION, it was so ordered.
3:49:30 PM
Co-Chair Stedman MOVED to ADOPT Amendment 8 and OBJECTED for
discussion purposes:
Page 6, lines 3-8
Delete all material
Insert:
"(c)A landlord or lessor that receives a payment
under this section must pass on a benefit to its
tenants by lowering the amount of rent by the amount
attributable to the tenant's unit. A landlord or lessor
may retain up to 10 percent of the payment required to
be passed on to tenants, to cover administrative costs.
Failure to comply with this requirement is a violation
of AS 45.50.471. The authority may audit the books and
records of a landlord or lessor for compliance with
this subsection."
Mr. Baker explained that the amendment would help to rectify
concerns about apartment complexes and multi-dwellings. The
amendment does not provide for heating assistance for
commercial properties, but would assist renters. He related
how the payment would be passed on to the renter. He said
that the landlord is able to take 10 percent for
administrative costs.
3:54:15 PM
Senator Dyson appreciated the amendment. He wondered about
the fairness of the timing. Mr. Baker stated that previous
drafts dealt with this issue and the amendment clarifies the
details and provides for an audit.
Senator Huggins said that it appears that the tenant could
be commercial. He asked how much 10 percent would be in
dollars. Mr. Baker said 10 percent of the rebate could be
used for administrative costs and 10 percent would go back
to the tenant.
3:58:54 PM
Senator Elton said the number of units is another factor.
Mr. Baker said the 5-unit complex would be eligible for 5
times 300 gallons during the 7 month window. Senator Elton
did the math to calculate the administrative fee.
Senator Thomas asked if a landlord could justify a rent
increase without factoring in fuel costs. He wondered if
this overrides a lease. Mr. Baker said his understanding is
that the landlord who receives a rebate must pass on a
benefit to the tenant. He said an attempt was made to try
to attribute the benefit to the fuel costs.
4:03:26 PM
Co-Chair Stedman WITHDREW his OBJECTION to Amendment 8.
There being NO OBJECTION, it was so ordered.
Co-Chair Hoffman MOVED to ADOPT conceptual Amendment 10 to
change the amount of $250 on page 4, line 21, and throughout
the bill, to $500. There being NO OBJECTION, it was so
ordered.
Co-Chair Stedman MOVED to ADOPT conceptual amendment 11:
Page 7, lines 6-7
Delete "on its billing statement"
Insert "in a manner prescribed by AEA"
Co-Chair Stedman OBJECTED for discussion purposes.
4:06:46 PM
Ms. Fisher-Goad explained the amendment is to provide
flexibility to AEA to work with the distributors and
residential customers to implement the program. She did not
have objections to the amendment.
Senator Elton suggested a friendly amendment to use
"authority" instead of AEA.
Ms. Fisher-Goad agreed.
Co-Chair Stedman WITHDREW his OBJECTION. There being NO
OBJECTION, it was so ordered.
4:08:39 PM
Co-Chair Hoffman MOVED to REPORT CSSB 4002 out of committee
with individual recommendations and the accompanying fiscal
notes. There being NO OBJECTION, it was so ordered.
CSSB 4002 (FIN) was REPORTED out of Committee with a "do
pass" recommendation and with three new Senate Finance
Committee fiscal notes.
ADJOURNMENT
The meeting was adjourned at 4:12 PM.
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