Legislature(2015 - 2016)SENATE FINANCE 532
03/16/2016 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB69 | |
| SB124 | |
| SB196 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 69 | TELECONFERENCED | |
| + | SB 124 | TELECONFERENCED | |
| *+ | SB 196 | TELECONFERENCED | |
| + | TELECONFERENCED |
SENATE FINANCE COMMITTEE
March 16, 2016
9:01 a.m.
9:01:48 AM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 9:01 a.m.
MEMBERS PRESENT
Senator Anna MacKinnon, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Peter Micciche, Vice-Chair
Senator Click Bishop
Senator Mike Dunleavy
Senator Lyman Hoffman
Senator Donny Olson
MEMBERS ABSENT
None
ALSO PRESENT
Senator Bill Stoltze, Sponsor; Brandon Brefczynski, Staff,
Senator Bill Stoltze; Janey Hovenden, Director,
Corporations, Business and Professional Licensing,
Department of Commerce, Community and Economic Development;
Dr. Edward Barrington, Legislative Chairman, Alaska
Chiropractic Society and Board; Dr. Jennifer Jozwiak,
Member, Alaska Chiropractic Society and Board, Juneau;
Daniel George, Staff, Senator Bill Stoltze; Kris Curtis,
Auditor, Division of Legislative Audit; Denise Daniello,
Executive Director, Alaska Commission on Aging; Marie
Darlin, AARP, Juneau; Tim Grussendorf, Staff, Senator Lyman
Hoffman; Sarah Fisher-Goad, Executive Director, Alaska
Energy Authority, Department of Commerce, Community and
Economic Development.
PRESENT VIA TELECONFERENCE
Debbie Ryan, Alaska Chiropractic Society, Anchorage; Terry
Snyder, President, American Association of Retired Persons
(AARP), Mat-Su; Amanda Lofgren, Officer, Alaska Mental
Health Trust Authority, Anchorage; Banarsi Lal, Self,
Fairbanks; Jan Fena, Member, Soldotna Senior Center,
Soldotna; Crystal Enkvist, Executive Director, Alaska Power
Association, Anchorage; Ingemar Mathiasson, Energy Manager,
Northwest Arctic Borough, Kotzebue; Peter Crimp, Self,
Anchorage; David Messier, Rural Energy Coordinator, Tanana
Chiefs Conference, Fairbanks; Piper Foster-Wilder, Deputy
Director, Renewable Energy Alaska Project, Anchorage.
SUMMARY
SB 69 BD OF CHIROPRACTIC EXAMINERS; PRACTICE
SB 69 was HEARD and HELD in committee for further
consideration.
SB 124 EXTEND SUNSET ON AK COMMISSION ON AGING
SB 124 was HEARD and HELD in committee for
further consideration.
SB 196 POWER COST EQ FUND: RESERVE ACCT;DIVIDEND
SB 196 was HEARD and HELD in committee for
further consideration.
9:02:44 AM
AT EASE
9:02:50 AM
RECONVENED
SENATE BILL NO. 69
"An Act relating to the Board of Chiropractic
Examiners and the practice of chiropractic."
9:03:04 AM
Senator Dunleavy disclosed that he had a financial interest
in a chiropractic office.
9:03:26 AM
SENATOR BILL STOLTZE, SPONSOR, hoped to work as a conduit
for better access to medical services by increasing access
for high school physicals. He relayed that the Alaska
School Activities Association had lamented their limited
access to physicals for children, not only availability,
but also efficiency and affordability. He said that schools
had not used chiropractors for physicals due to ambiguity
in statute. He believed that the bill would provide the
guidance needed in order to expend access to physicals.
9:06:57 AM
Co-Chair MacKinnon requested a sectional analysis.
9:07:00 AM
BRANDON BREFCZYNSKI, STAFF, SENATOR BILL STOLTZE, discussed
the sectional analysis (copy on file):
Section 1: Amends AS 08.20.055 by adding new language
that allows the board to adopt regulations for the
following:
- Training and scope of practice of chiropractic
interns and chiropractic preceptors;
- Designation of a nationally recognized
certification program for chiropractic clinical
assistants;
- Performance of patient examinations.
Section 2: Amends AS 08.20.100(b) clarifying how
chiropractors can accept referrals, authorizes
chiropractors to perform school physicals, and allows
the employment of certified chiropractic clinical
assistants, chiropractic interns, and chiropractic
preceptors.
Section 3: Amends AS 08.20.100 by adding a new
subsection (d) that exempts chiropractic interns from
this section.
Section 4: Amends AS 08.20.160 regarding the
requirements for temporary permits.
Section 5: Amends AS 08.20 by adding a new section (AS
08.20.168) regarding chiropractic clinical assistants.
Section 6: Amends 08.20.185 by changing name of "peer
review committee" to "utilization review committee" to
better reflect the purpose of the committee. Also, the
change is intended to assist in determining what
complaints warrant a referral to investigative staff.
Section 7: Amends AS 08.20.200 by updating penalties
for unlicensed practice.
Section 8: Amends AS 08.20.210 by updating penalties
for fraudulent licenses and certificates.
Section 9: Amends definition of "chiropractic
examination" located in AS 08.20.900(7).
Section 10: Amends AS 08.20.900 by adding new
definitions for "chiropractic clinical assistant,"
chiropractic intern," and "chiropractic preceptor."
9:10:09 AM
Senator Hoffman looked at Section 2, and wondered whether
the referrals were for chiropractic treatment or physical
exams.
Mr. Brefczynski deferred the question to Mr. Barrington.
9:11:13 AM
Senator Olson asked whether other medical providers were
able to sign off on a sports physical.
Senator Stoltze responded that he did not know the answer.
9:11:51 AM
Co-Chair MacKinnon noted that there were several experts
waiting to testify, as well as were available to respond to
questions.
9:12:25 AM
Senator Stoltze noted that other practitioners that were
able to perform physicals under statute were medical
doctors, doctors of osteopathic medicine, advanced nurse
practitioners, and physician's assistants.
9:12:52 AM
Senator Olson queried the most common reason for a person
to fail a sports physical exam.
Mr. Brefczynski responded that he could not speak to
disqualifying factors for sport physical exams.
9:13:19 AM
Senator Olson understood that cardiovascular issues were a
main disqualifying factor. He expressed concern that
chiropractic care was generally related to muscular and
skeletal expertise, and not cardiovascular issues.
JANEY HOVENDEN, DIRECTOR, CORPORATIONS, BUSINESS AND
PROFESSIONAL LICENSING, DEPARTMENT OF COMMERCE, COMMUNITY
AND ECONOMIC DEVELOPMENT (DCCED), testified that the bill
would add layers to the existing chiropractic program. She
solicited specific questions on the legislation.
9:15:24 AM
Co-Chair MacKinnon stated that medical questions would be
held for the medical professionals.
Co-Chair MacKinnon wondered whether the administration was
in favor of the legislation.
Ms. Hovenden replied that the Board of Chiropractic
Examiners had come out in support, but that the division
did not have a position on the bill.
Co-Chair MacKinnon asked whether the division had any input
on the bill.
Ms. Hovenden replied that she did not believe so.
9:16:00 AM
Senator Olson asked whether the bill faced any opposition.
Ms. Hovenden replied that she was not aware of any
opposition to the legislation.
9:16:05 AM
Senator Olson probed whether the State Medical Board and
Board of Nurse Practitioners supported the bill.
Ms. Hovenden responded that those groups had not taken a
position on the legislation.
9:16:20 AM
Vice-Chair Micciche aske Ms. Hovenden to explain the fiscal
note, specifically the way in which boards and commissions
were of no cost to the state.
Ms. Hovenden replied that the division received supported
services, which meant that the licensees paid for all of
the expenses for their program within the division.
9:16:52 AM
Co-Chair MacKinnon understood that the bill would require
the addition of one, part-time position.
Ms. Hovenden replied in the affirmative, and stated that
there would also be a regulations project.
9:17:31 AM
DR. EDWARD BARRINGTON, LEGISLATIVE CHAIRMAN, ALASKA
CHIROPRACTIC SOCIETY AND BOARD, testified in support of the
legislation. He said that the proposed changes outlines in
SB 69 were in the public interest. He stated that allowing
the Board of Examiners to set standards for chiropractic
clinical assistance was essential so that any employee that
had direct patient care contact was fully qualified. He
relayed that authorizing and setting standards for doctors
that were already practicing who wished to host new
graduates, or students who had completed all of the
requirements but had not fully graduated, to acquire more
clinical experiences. He shared that the law currently
allowed for chiropractic physicians to examine children for
student physicals and to write excuses to keep them from
participating in sports activities. He relayed that rural
districts in the state currently used chiropractic services
for sports examinations. He believed that other areas of
the state did not use chiropractors in the same way because
the law was not specific enough. He noted that the statute
had not been addressed since 1988, and that a utilization
review would be a step toward clarification. He stated that
the board had brought penalties for fraudulent practice up
to par with other disciplines.
9:21:53 AM
Senator Olson wondered how many chiropractors were licensed
in the state.
Dr. Barrington responded that there were 300 currently
licensed chiropractors; 265 actively practicing.
9:22:05 AM
Senator Olson queried any type of licensing action taken
against licensees over the past 3 years.
Dr. Barrington replied that no suspension of license had
been undertaken. He said that investigations did occur, but
that the board did not hear of those until a determination
had been reached. He relayed that within the last year, the
board had recommended additional classes for a practitioner
that had made an error in chart keeping.
9:23:20 AM
Vice-Chair Micciche queried how the legislation served the
public interest.
Dr. Barrington replied that public interest was best served
by the qualifications of chiropractor physicians, and by
the ability for parents to select the practitioner
performing their child's physical. He said that in many
cases the availability of other practitioners might be
scarce.
9:24:31 AM
Vice-Chair Micciche asked whether a chiropractor could
recommend that a student avoid a sporting activity for a
cardiovascular reason.
Dr. Barrington replied in the affirmative. He stated that
the scope of chiropractic practice was limited, but their
diagnostic and examination abilities were unlimited.
9:26:16 AM
Vice-Chair Micciche understood that currently chiropractors
could not write letters allowing for participation, but
could write letters recommending non participation.
Dr. Barrington replied in the affirmative.
9:26:47 AM
Senator Hoffman reiterated his question about referrals.
Dr. Barrington replied that anyone who walked into a
chiropractic office of their own volition was considered a
self-referred patient. He thought that word "referral" in
Section 2 was related to a person who walked in off the
street, or was referred by another practitioner or entity.
Co-Chair MacKinnon OPENED public testimony.
9:28:16 AM
DR. JENNIFER JOZWIAK, MEMBER, ALASKA CHIROPRACTIC SOCIETY
AND BOARD, JUNEAU, spoke in support of the legislation.
9:29:13 AM
Senator Olson queried the expertise of chiropractors as
related to disqualifying issues pertaining to sports
physicals, such as cardiovascular disease, rheumatoid
arthritis, or diabetes.
Dr. Jozwiak replied that in her training a Palmer College
of Chiropractic she had also been a diagnostic teaching
assistant. She shared that in that training she was taught
to recognize red flags for the aforementioned issues. She
asserted that patient history was a major factor in
diagnosing medical conditions, and that there was always
more than one indicator observed.
9:30:38 AM
Senator Bishop referred to a letter in member's packets
Palmer College (copy on file). He pointed out to the
committee the section related to United States Department
of Transportation physicals:
Doctors of Chiropractic are included as eligible
health care providers to provide physical examinations
by the United States Department of Transportation
(DOT). In fact, two faculty clinicians at the Palmer
Chiropractic Clinics in the Quad Cities (Davenport and
Bettendorf, Iowa, and Moline and Rock Island, Ill.)
are listed on the National registry as certified to
provide DOT "Fit for Duty" physical exams.
The DOT physical is a comprehensive evaluation
covering all systems of the body, including a
comprehensive health history and review along with a
urinalysis screening. All of these examination aspects
are taught and tested as part of Palmer's Doctor of
Chiropractic curriculum, in both the academic and
clinical portion of the education.
9:31:22 AM
Vice-Chair Micciche recalled that sports exams had been
fairly simple in his experience.
Dr. Jozwiak responded that she had a copy of the exam that
she could share with the committee.
9:32:32 AM
Senator Olson surmised that chiropractors did not check for
inguinal hernias.
Dr. Jozwiak stated that she had patients lay down on the
table with their knees bent while she palpated the area.
She explained that anything abnormal was investigated
further.
Senator Olson argued that there was no direct examination
for an inguinal hernia.
Dr. Jozwiak responded that a check would be done if other
red flags were observed.
9:34:24 AM
DEBBIE RYAN, ALASKA CHIROPRACTIC SOCIETY, ANCHORAGE (via
teleconference), noted that she did not wish to testify on
the record.
Co-Chair MacKinnon CLOSED public testimony.
9:34:51 AM
AT EASE
9:38:27 AM
RECONVENED
Senator Dunleavy clarified that he had an interest in an
investment company that had an interest in a chiropractic
office.
SB 69 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 124
"An Act extending the termination date of the Alaska
Commission on Aging; and providing for an effective
date."
9:39:47 AM
SENATOR BILL STOLTZE, SPONSOR explained that SB 124 would
extend the termination date of the Alaska Commission on
Aging. He stated that the commission was established in
1981. He remarked that the commission served the growing
aging population of Alaska. He stated that the recommended
8 year extension was based on the recommendations of the
Legislative Auditor to the Legislative Budget on Audit
Committee.
9:42:25 AM
Co-Chair MacKinnon solicited additional comments from the
sponsor's support staff.
9:42:31 AM
DANIEL GEORGE, STAFF, SENATOR BILL STOLTZE, replied that
the bill had a second section that contained an immediate
effective date.
9:43:02 AM
KRIS CURTIS, AUDITOR, DIVISION OF LEGISLATIVE AUDIT, stated
that the commission was serving the public interest by
helping older Alaskans to lead dignifies, independent, and
useful lives thorough advocacy, outreach, and education,
Furthermore, the commission met the federal requirement
that each state establish an advisory council to advise the
state on aging matters including developing and
administering a state plan, and operations conducted under
the plan. She said that the maximum 8 year extension had
been recommended. She noted that 2 recommendations had been
made in an effort to improve operations:
1. The commission's executive director should
implement and follow procedures to public notice all
commission meetings.
2. The commission's chairperson should review and
approve the legislation watch list prior to
distribution.
Ms. Curtis noted that the commission periodically held
teleconferences to gather public input and discuss
legislation affecting seniors. She added that to facilitate
feedback the commission annually published a legislation
watch list that identified legislative bills that were of
interest to the commission. She stated that a review had
found that the watch lists had contained several bill that
were unrelated to the commission's responsibilities, which
prompted a review of the watch list before distribution.
9:44:54 AM
DENISE DANIELLO, EXECUTIVE DIRECTOR, ALASKA COMMISSION ON
AGING, spoke in support of the legislation. She stated that
the commission worked closely with the Division of Senior
and Disability Services in assisting the Department of
Health and Social Services, which was the sole state agency
on aging as authorized by the governor, to fulfil those
responsibilities. She relayed that the Division of Senior
and Disability Services administered the majority of state
and federally funded senior programs, while the commission
was responsible for developing the state plan for senior
services, advocacy, education, and interagency
collaboration. She stated that the commission's last
reauthorization was 8 years ago, at which time 3 state
plans were developed for senior services, the most recent
of which was completed in June 2015. She shared that all of
the plans were available online, and satisfied the federal
requirement to be able to draw down federal funds for
senior programs. She furthered that the commission was a
mandated statutory advisor to the Alaska Mental Health
Trust Authority, and provided information, budget, and
policy recommendations to the trust regarding the needs of
older Alaskans with Alzheimer's disease and related
dementias. She spoke to the completion of the first ever
state plan that focused on Alzheimer's disease, and shares
that the document was available on the commission's
website. She said that the commission supported the
Medicaid Adult Dental Program for Senior Benefits and
Medicaid Reform. She relayed that the commission hosted
numerous events and activities to educate and support
seniors and their communities.
Co-Chair MacKinnon OPENED public testimony.
9:48:51 AM
TERRY SNYDER, PRESIDENT, AMERICAN ASSOCIATION OF RETIRED
PERSONS (AARP), MAT-SU (via teleconference), spoke in
support of the legislation. She represented 89,000 AARP
members who urged the reauthorization of the Commission on
Aging. She stressed the economic importance of what the
senior population brought to the state's economy. She noted
that seniors volunteers countless hours in communities. She
requested quick passage of the bill through the committee
for the reauthorization of the commission.
9:50:27 AM
AMANDA LOFGREN, OFFICER, ALASKA MENTAL HEALTH TRUST
AUTHORITY, ANCHORAGE (via teleconference), testified in
support of the legislation. She relayed that the trust
supported program services and policies that would
positively impact the lives of beneficiaries, including
Alaskan's who experienced Alzheimer's disease and related
dementia. She noted that AS 47.30.041 indicated that the
commission should serve as a statutory advisory board to
the Alaska Mental Health Trust Authority, and advised the
authority and trustees on the needs of older Alaskans with
cognitive impartments. She related that the commission, in
partnership with the trust and other agencies, published
the Alaska Roadmap for Alzheimer's disease and related
dementia in 2015. She stated that the commission made
recommendations to the trust board regarding mental health
programs for senior trust beneficiaries, as well as how to
use funds that benefitted the vulnerable population of
beneficiaries. She asserted that the commission was
integral in developing state plans for senior services,
which leveraged Older American Act funding to support
beneficiaries.
9:52:02 AM
BANARSI LAL, SELF, FAIRBANKS (via teleconference),
testified in support of the legislation. He relayed that he
was acting chair of the Fairbanks Northstar Borough Senior
Citizens Advisory Commission. He said that the Fairbanks
commission supported the work of the Alaska Commission on
Aging. He lauded the commission for serving seniors in the
areas of planning, education, and advocacy. He noted that
the commission had fulfilled federal requirements under the
Older Americans Act, which meant that Alaska would continue
to receive funds for senior programs and services. He
praised work of the commission and supported the 8 year
extension.
9:55:12 AM
JAN FENA, MEMBER, SOLDOTNA SENIOR CENTER, SOLDOTNA (via
teleconference), spoke in strong support of the
legislation. She testified that the commission was vital in
their advocacy, outreach, and support of older Alaskans, as
well as their close work in collaboration with senior
centers, Alaska Housing Finance Corporation, the Department
of Health and Social Services, the Alaska Mental Health
Trust Authority, ADRC, AARP, Agenet, and many other
agencies to help older Alaskans live independently in the
community of their choice. She lauded the commission's work
to secure funding for senior programs and services.
9:57:46 AM
MARIE DARLIN, AARP, JUNEAU, testified in support of the
legislation. She echoed Ms. Snyder's comments.
Co-Chair MacKinnon CLOSED public testimony.
9:59:24 AM
Co-Chair MacKinnon solicited further questions from
committee members.
SB 124 was HEARD and HELD in committee for further
consideration.
9:59:41 AM
AT EASE
10:00:39 AM
RECONVENED
SENATE BILL NO. 196
"An Act relating to the use of certain unexpended
earnings from the power cost equalization endowment
fund."
10:01:06 AM
Senator Hoffman related that the Power Cost Equalization
program (PCE) had been in existence for 36 years with the
primary purpose of assisting with the high cost of
electrical energy throughout rural Alaska. He said that
many communities participate and that there had been
discussion related to the program's high earnings that had
transpired in FY 13 and FY 14. He stated that the bill
would ensure that during the high earning years of the
fund, the fund should only pay for its intended purpose and
any excess earnings would be distributed to two other
programs.
10:02:18 AM
TIM GRUSSENDORF, STAFF, SENATOR LYMAN HOFFMAN, pointed out
to the committee that the bill was available in their
packets, as well as a document that illustrated the
earnings of the program at 4.3 percent, and a sectional
analysis. He discussed the sectional analysis (copy on
file):
Section 1 adds a new sentence to AS 54.4.0820(c)
requiring that the commissioner of revenue determine
the earnings on the power cost equalization endowment
fund (PCE fund) for the fiscal year on June 30 each
year.
Section 2 adds a new subsection to AS 42.45.085 that
allows the legislature to appropriate the part of the
annual fiscal year earnings of the PCE fund in excess
of the expenditures necessary to achieve the purposes
under AS 42.45.085(a) to the general fund and the
renewable energy grant fund, and to appropriate some
funds back to the PCE fund.
10:04:37 AM
SARAH FISHER-GOAD, EXECUTIVE DIRECTOR, ALASKA ENERGY
AUTHORITY, DEPARTMENT OF COMMERCE, COMMUNITY AND ECONOMIC
DEVELOPMENT, testified in support of the legislation. She
stated that the authority supported the concept of being
able to use the excess earnings for the general and
renewable energy funds listed in the legislation. She said
that the earnings in FY 16 were difficult to predict, and
that she would work with the bill sponsor to clarify which
fiscal year to use and how much funds would be available
for extra purposes.
10:05:38 AM
Senator Hoffman announced there was a section in the bill
that would require an amendment that would create a single
mechanism for dispensing excess earnings.
10:06:06 AM
Co-Chair MacKinnon stated that she had researched the issue
and had proposed that projects that were currently being
funded at the Alaska Energy Authority should have some
nexus with the PCE fund.
10:06:54 AM
Co-Chair MacKinnon remarked that as revenue opportunities
in the state shrank, rural Alaska remained in need of many
dollars for investment in energy to keep families warm. She
contended that it the state had an energy project that had
cost millions from in communities, she wondered why PCE
would need to continue.
Ms. Fisher-Goad appreciated the conversation. She assured
that committee that AEA was eager to participate in
discussions concerning to how programs related to each
other. She mentioned that the PCE program, for electrical
projects, hit approximately 30 percent of the kilowatt
hours generated in rural Alaska communities; approximately
193 communities benefitted from the PCE program. She
furthered that the remaining 70 percent of the kilowatt
hours were not eligible for cost under the program. She
said that the Renewable Energy Fund complimented the PCE by
participating in reducing costs for communities, across all
kilowatt hours. She pointed out to the committee that
schools benefitted greatly from the partnership; they were
not eligible for PCE, but if a utility that serviced a
school had a renewable energy project that reduce costs,
the school would receive the benefit. She stressed that the
issue was not limited to electricity, but included heating
projects that benefitted community facilities and other
programs. She assured the committee that the authority
would work with committee on their continued investment in
the PCE and renewable energy programs.
10:10:35 AM
Co-Chair MacKinnon remarked that Senator Hoffman had
advocated for heating projects under the statute. She
remarked that electricity consumption was a big issue, but
that heating homes was the top priority. She said that as
the state moved into an uncertain fiscal climate, there
would be tension between electricity versus heating.
10:13:13 AM
Co-Chair Kelly noted that there was a letter of support
that made reference to the 2000 capitalization of the PCE
fund (copy on file). He said that when the state
capitalized the fund, the $100 million had counted against
the state. He stated that Fairbanks would receive subsidies
on the gas project thorough loans.
10:14:41 AM
Senator Hoffman commented that the state formerly had
appropriations to fund the PCE with the intent to set up
the endowment. He stated that the anticipation had been
that the program would require additional General Fund
appropriations for several years, but because of earnings
on the fund those appropriations were reduced; in 2015, the
fund was self-functioning and did not require a general
fund appropriation. He believed that energy continued to be
a major issue throughout the state and the legislature
should strive to make Alaska a more affordable place to
live for all Alaskans.
10:16:26 AM
CRYSTAL ENKVIST, EXECUTIVE DIRECTOR, ALASKA POWER
ASSOCIATION, ANCHORAGE (via teleconference), spoke in
support of the legislation. She read from prepared
testimony (copy on file):
Alaska Power Association (APA), the statewide electric
utility trade association, supports Senate Bill 196,
which would protect funding for the Power Cost
Equalization Program (PCE) while allowing
appropriation of funds from the PCE Endowment for
other valuable purposes.
APA members believe this legislation will allow the
PCE program to continue providing a vital measure of
relief to ratepayers in communities throughout our
State where electric rates are the highest, while
sharing benefits with the General Fund, the Renewable
Energy Grant Fund and the PCE Endowment. This
distribution of benefits is especially important in
these difficult financial times.
Many APA members throughout the state have integrated
wind and hydroelectric power into their systems
through funding from the Renewable Energy Grant Fund,
and their customers see the results in lower or
stabilized bills. Through SB 196, work could continue
on renewable energy systems that will positively
impact Alaskans for generations to come.
APA member utilities serve communities from Barrow to
Unalaska, through the Interior and Southcentral and
down the Inside Passage. We appreciate your decades-
long leadership in assisting our home grown industry
in striving to provide affordable and reliable
electric power to Alaskans. Your sponsorship of SB 196
continues these collaborative efforts, and we urge
passage of this legislation.
10:18:43 AM
INGEMAR MATHIASSON, ENERGY MANAGER, NORTHWEST ARCTIC
BOROUGH, KOTZEBUE (via teleconference), spoke in support of
the legislation. He stated that the borough had recently
complete a large wind/diesel project that would benefit
several communities. He said that funding for the project
had been granted through the Alaska Renewable Energy Fund,
and had hedged against the rising cost of diesel fuel,
which had threatened the existence of remote communities.
He stressed the importance that the PCE fund had been
established to assist rural Alaska communities with the
rising cost of diesel fuel for their electric utilities. He
said that communities had embraced energy efficient
alternatives, which would lessen the need for the PCE fund
in the future. He stressed that allowing as much of the
excess PCE funds as possible to be transferred into the
renewable energy fund would provide the state a path
forward to eventually build itself out of the need for PCE.
He concluded that the future for rural Alaska's energy
structure was to utilize locally available resources as
much as possible.
10:20:31 AM
PETER CRIMP, SELF, ANCHORAGE (via teleconference),
testified in support of the legislation. He stated that
reliable and reasonable priced energy needed to be
maintained on order to support the state's investments and
to provide fairness in the funding for rural and non-rural
energy projects. He noted that the rural energy fund had
proven to be a successful vehicle for stimulation
technically and economically viable projects since it was
established by the legislature in 2008. He noted that AEAs
annual report indicated that 54 projects were in operation,
and that every dollar invested in the projects would have a
$2.50 return. He believed that the state should maintain
its investment in maintaining clean, renewable energy.
10:22:32 AM
DAVID MESSIER, RURAL ENERGY COORDINATOR, TANANA CHIEFS
CONFERENCE, FAIRBANKS (via teleconference), spoke in strong
support of the legislation. He lamented that rural Alaska
experience electricity costs that ranged upward of $1 per
kilowatt hour, due not only to the cost of oil, but also
the administrative costs of managing a small, rural
electric utility. He said that the PCE endowment supported
the PCE program, which reduced the cost per kilowatt for
80,000 rural Alaskans across the state. He lauded the
benefits of the PCE program. He noted that the renewable
energy fund had a proven track record of bringing money
into the state and reducing the long-term cost to the PCE
program. He asked legislators to consider adding language
to the bill that would allow some portion of the 30 percent
allocated to the Alaska Renewable Energy Grant fund to
support the Village Energy Efficiency Program (VEEP), which
had an even stronger track record of reducing the long-term
costs of the PCE program. He said that he would be
submitting a letter with over 100 signatures, from across
the Interior, showing individual support for SB 196.
10:25:01 AM
PIPER FOSTER-WILDER, DEPUTY DIRECTOR, RENEWABLE ENERGY
ALASKA PROJECT, ANCHORAGE (via teleconference), spoke in
support of the legislation. She asserted that SB 196 would
provide an opportunity to provide secure and predicable
funding for renewable energy projects across the state. She
recounted a brief history of the successes of the PCE fund.
She stressed that the renewable energy fund provided
significant savings, which would continue to occur
regardless of the price of oil. She relayed that the funds
that SB 196 would provide to renewable energy projects
across the state was significant enough to continue to
leverage private capital to build projects. She furthered
that such public/private partnerships were crucial to
Alaska's future. She urges the committee to pass SB 196,
with the provision to use excess earnings to fund the
renewable energy fund beginning 2016.
Co-Chair MacKinnon CLOSED public testimony.
10:28:19 AM
AT EASE
10:28:56 AM
RECONVENED
10:29:00 AM
Co-Chair MacKinnon looked at the fiscal note, which
reflected a loss in 2015. She thought that further
discussion of the fiscal note should occur after the bill
was amended.
10:29:48 AM
Vice-Chair Micciche asked whether the bill would take
affect after the return reached 7 percent.
Senator Hoffman replied that for several years he had
advocated that the 7 percent was too high, and had
recommended that the rate of return for investment should
be 4.5 percent because investment decisions would have to
be riskier at a 7 percent return. He believed that the
prudent investment rule needed to be addressed as it
related to the 7 percent investment.
10:31:21 AM
Co-Chair MacKinnon said that the 7 percent was a cap that
would ensure that no more than that was withdrawn.
Senator Hoffman agreed, but felt that it should be
clarified further that the number was not a "hard" number.
He reiterated that it was important to be clear about the
bill's intent, as well as what funds would be available.
SB 196 was HEARD and HELD in committee for further
consideration.
Co-Chair MacKinnon discussed housekeeping.
ADJOURNMENT
10:35:09 AM
The meeting was adjourned at 10:35 a.m.