Legislature(1999 - 2000)

04/14/2000 03:25 PM Senate RES

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                   SENATE RESOURCES COMMITTEE                                                                                 
                         April 14, 2000                                                                                         
                            3:25 p.m.                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Rick Halford, Chairman                                                                                                  
Senator Robin Taylor, Vice Chairman                                                                                             
Senator Jerry Mackie                                                                                                            
Senator Lyda Green                                                                                                              
Senator Sean Parnell                                                                                                            
Senator Georgianna Lincoln                                                                                                      
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Senator Pete Kelly                                                                                                              
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
CS FOR HOUSE BILL NO. 304(FIN) am                                                                                               
"An Act  relating to issuance  and sale  of revenue bonds  to fund                                                              
drinking  water  projects, to  the  Alaska  clean water  fund,  to                                                              
creation  of an  Alaska  clean water  administrative  fund and  an                                                              
Alaska drinking water  administrative fund, to fees  to be charged                                                              
in connection  with loans  made from the  Alaska clean  water fund                                                              
and the  Alaska drinking water fund,  and to clarification  of the                                                              
character and permissible uses of  the Alaska drinking water fund;                                                              
amending Rule  3, Alaska Rules  of Civil Procedure;  and providing                                                              
for an effective date."                                                                                                         
     SCHEDULED BUT NOT HEARD                                                                                                    
                                                                                                                                
HOUSE BILL NO. 194                                                                                                              
"An Act  correcting, in  the Alaska Disaster  Act, a  reference to                                                              
the former  oil and hazardous  substance release response  fund to                                                              
describe that fund by its correct name."                                                                                        
     -MOVED HB 194 OUT OF COMMITTEE                                                                                             
                                                                                                                                
CS FOR HOUSE BILL NO. 116(FIN)                                                                                                  
"An Act relating to the Board of  Agriculture and Conservation, to                                                              
the director  of agriculture, to  the agricultural  revolving loan                                                              
fund and to loans  from the fund, to the disposal  of interests in                                                              
state agricultural land; and providing for an effective date."                                                                  
     -HEARD AND HELD                                                                                                            
                                                                                                                                
PREVIOUS SENATE COMMITTEE ACTION                                                                                              
                                                                                                                                
HB 304 - See Resources minutes dated 4/10/00.                                                                                   
                                                                                                                                
HB 194 - No previous Senate action.                                                                                             
                                                                                                                                
HB 116 - See Resources Committee minutes dated 4/12/00.                                                                         
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
Ryan Colgan                                                                                                                     
Staff to Representative Whitaker                                                                                                
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Testified for sponsor of HB 194                                                                          
                                                                                                                                
Ms. Barbara Cotting                                                                                                             
Legislative Aide to Representative James                                                                                        
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Testified for the sponsor of HB 116                                                                       
                                                                                                                                
Representative Jeanette James                                                                                                   
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT: Sponsor of HB 116                                                                                         
                                                                                                                                
Mr. Rob Wells, Director                                                                                                         
Division of Agriculture                                                                                                         
Department of Natural Resources                                                                                                 
1800 Glenn Highway, Suite 12                                                                                                    
Palmer, AK  99645                                                                                                               
POSITION STATEMENT: Expressed concerns about HB 116                                                                           
                                                                                                                                
Ms. Elizabeth Hickerson                                                                                                         
Assistant Attorney General                                                                                                      
Department of Law                                                                                                               
1031 W 4th Ave., Suite 200                                                                                                      
Anchorage, AK  99501-1994                                                                                                       
POSITION STATEMENT:  Discussed conflict of interest problems with                                                             
Version Q of HB 116                                                                                                             
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 00-25, SIDE A                                                                                                            
Number 001                                                                                                                      
                                                                                                                                
CHAIRMAN HALFORD called the Senate  Resources Committee meeting to                                                            
order  at  3:25  p.m.   Present  were  Senators  Taylor,  Parnell,                                                              
Mackie,  Lincoln  and  Chairman  Halford.    The  first  order  of                                                              
business to come before the committee was HB 194.                                                                               
                                                                                                                                
                   HB 194-DISASTER ASSISTANCE                                                                               
                                                                                                                                
MR. RYAN COLGAN,  staff to Representative Whitaker,  sponsor of HB
194,  gave  the following  overview  of  the  measure. HB  194  is                                                              
technical and  does not  change any components  or affect  the Oil                                                              
and Hazardous  Substance Release  Prevention and Response  Fund in                                                              
any manner.   When this  title was changed  in 1994,  the drafters                                                              
simply  overlooked one  reference  made to  this  fund in  statute                                                              
therefore the original  title remains in Title 26  and needs to be                                                              
updated.    He  informed  committee   members  that  Mary  Siroky,                                                              
Information   Officer   for  the   Department   of   Environmental                                                              
Conservation (DEC), was present to answer questions.                                                                            
                                                                                                                                
SENATOR  TAYLOR asked  why this  change  was not  included in  the                                                              
revisor's bill.                                                                                                                 
                                                                                                                                
MR. COLGAN said  the reason is explained in detail  in a memo from                                                              
Mr.  Crawford of  the Division  of Legal  Services.   He read  the                                                              
following from that memo.                                                                                                       
                                                                                                                                
     Ordinarily, this is the sort  of problem that could easily be                                                              
     remedied  in a  revisor's  bill and  I  initially thought  to                                                              
     include such  a correction in  this year's bill.   However in                                                              
     this case, when the fund was  renamed, two different accounts                                                              
     within  the  fund  were  created,   the  first  the  Oil  and                                                              
     Hazardous  Substance Release  Prevention Account and  second,                                                              
     the  Oil and  Hazardous Substance  Release Response  Account.                                                              
     Although the titles of the accounts  might provide some clue,                                                              
     there  is  no  definitive  way   to  tell  whether  the  1994                                                              
     Legislature  wanted recourse  under AS 26.23.050(b),  limited                                                              
     only  to  one particular  account  or  alternatively  whether                                                              
     recourse  could be  had  with respect  to  both accounts,  at                                                              
     least under some circumstance.                                                                                             
                                                                                                                                
SENATOR TAYLOR asked if this amendment  will give recourse to both                                                              
accounts.                                                                                                                       
                                                                                                                                
MR. COLGAN  explained this  amendment makes the  name of  the fund                                                              
consistent in statute.                                                                                                          
                                                                                                                                
CHAIRMAN HALFORD noted  that Senator Taylor was  asking which fund                                                              
it applies to or whether it applies to both.                                                                                    
                                                                                                                                
MR. COLGAN  said he  understands it to  apply specifically  to the                                                              
Oil and Hazardous  Substance Release Response Fund.   He added, "I                                                              
think 'prevention and' is the phrase included in this bill.                                                                     
                                                                                                                                
CHAIRMAN HALFORD asked if it is intended to apply to both funds.                                                                
                                                                                                                                
SENATOR TAYLOR noted that DEC staff gave an affirmative nod.                                                                    
                                                                                                                                
There  being no  further questions  or  testimony, SENATOR  TAYLOR                                                              
moved HB  194 from committee  with individual recommendations  and                                                              
its  accompanying zero  fiscal note.   There  being no  objection,                                                              
CHAIRMAN HALFORD announced it was so ordered.                                                                                   
                                                                                                                                
          HB 116-BOARD OF AGRICULTURE AND CONSERVATION                                                                      
                                                                                                                                
CHAIRMAN HALFORD announced the committee  would take up HB 116 and                                                              
that a series of amendments had been prepared.                                                                                  
                                                                                                                                
The committee took a brief at-ease from 3:30 to 3:32 p.m.                                                                       
                                                                                                                                
CHAIRMAN HALFORD  informed committee members that  the sponsor had                                                              
prepared three amendments to HB 116.                                                                                            
                                                                                                                                
SENATOR  MACKIE moved  to adopt  Amendment  1 for  the purpose  of                                                              
discussion.  There being no objection, Amendment 1 was adopted.                                                                 
                                                                                                                                
BARBARA COTTING,  staff to Representative Jeanette  James, sponsor                                                              
of HB  116, informed committee  members that the  three amendments                                                              
are  the  result   of  a  subcommittee  meeting   held  yesterday.                                                              
Amendment 1 deals  with the ethics portion of the  bill.  It gives                                                              
the Board authority  to establish standards for  loans but removes                                                              
the Board's  authority to make  final decisions on  granting those                                                              
loans.   The amendment  will remove any  conflict of  interest and                                                              
allow board members to have loans.                                                                                              
                                                                                                                                
CHAIRMAN HALFORD  asked who will  make the final  determination of                                                              
which applicants get a loan.                                                                                                    
                                                                                                                                
MS. COTTING replied the loan officer  will in conjunction with the                                                              
director.                                                                                                                       
                                                                                                                                
CHAIRMAN   HALFORD  asked   if  the   agricultural  community   is                                                              
comfortable with that much power resting in the director.                                                                       
                                                                                                                                
MS.  COTTING  replied  yes,  for   that  particular  part  of  the                                                              
function.                                                                                                                       
                                                                                                                                
SENATOR MACKIE  asked if the  subcommittee discussed the  issue of                                                              
finding people to  serve on the board since most  qualified people                                                              
will have members of their families involved in agriculture.                                                                    
                                                                                                                                
SENATOR GREEN stated  this board was modeled after  the Commercial                                                              
Fishing and Agriculture Bank (CFAB).                                                                                            
                                                                                                                                
SENATOR TAYLOR  asked if  the board  will establish the  standards                                                              
and criteria upon which a loan may  be granted, rather than decide                                                              
who will get a loan.                                                                                                            
                                                                                                                                
SENATOR GREEN said that is correct.                                                                                             
                                                                                                                                
SENATOR  LINCOLN  asked  if her  concern  about  immediate  family                                                              
members was  removed.  She  also asked to  hear from the  staff at                                                              
the Department of  Natural Resources (DNR) and  asked whether they                                                              
were advised of the changes.                                                                                                    
                                                                                                                                
SENATOR GREEN said DNR staff were advised and given copies.                                                                     
                                                                                                                                
CHAIRMAN  HALFORD asked  Mr. Wells  to  address the  first of  the                                                              
three amendments.                                                                                                               
                                                                                                                                
MR. ROB  WELLS, Director  of the  Division of Agriculture,  stated                                                              
his understanding of the intent of  this legislation was to invest                                                              
more power in the  board.  He said he thinks the  language on page                                                              
3 of  the bill  that says, "may  employ staff  as directed  by the                                                              
board as responsible  for the daily operations  of the Agriculture                                                              
Revolving Loan Fund" could create a potential conflict.                                                                         
                                                                                                                                
SENATOR LINCOLN asked  Mr. Wells whether DNR supports  Amendment 1                                                              
and, if not, what DNR's concerns are.                                                                                           
                                                                                                                                
MR.  WELLS  said he  has  not had  a  chance  to confer  with  the                                                              
Commissioner  on   the  amendments.    [His  next   statement  was                                                              
inaudible.]                                                                                                                     
                                                                                                                                
SENATOR MACKIE  asked Mr.  Wells what his  concern is.   He stated                                                              
many questions regarding conflicts  of interest were raised at the                                                              
last hearing and that Amendment 1  takes the approval of loans out                                                              
of the board's hands.                                                                                                           
                                                                                                                                
MR. WELLS  said the board will  direct the director  regarding the                                                              
daily operations of the fund.  The  board is still responsible for                                                              
the  disposal of  the assets  of the  Agricultural Revolving  Loan                                                              
Fund and  will write  regulations that address  the loans  and the                                                              
disposal of assets.  Therefore, just  because the board is removed                                                              
from  the actual  vote  does  not mean  it  is not  directing  the                                                              
director.                                                                                                                       
                                                                                                                                
Number 864                                                                                                                      
                                                                                                                                
CHAIRMAN HALFORD asked Ms. Hickerson to comment.                                                                                
                                                                                                                                
MS.  ELIZABETH HICKERSON,  Assistant  Attorney  General, said  the                                                              
Department of  Law still  has concerns.   The Legislature  has the                                                              
ability  to  totally  exempt  boards   and  commissions  from  the                                                              
Executive Ethics Act.   This amendment  provides that the director                                                              
will now make  the loans.  Therefore,  a board member could  get a                                                              
loan yet the  board member directs the director  which creates the                                                              
potential for abuse regarding the  loan.  She stated Section 16 is                                                              
problematic  because under  that  section, the  board disposes  of                                                              
property.  The  board is not restricted from  purchasing property.                                                              
A  board member  could  play a  major  role in  determining  which                                                              
parcel will be disposed  of and when and how it  will be disposed.                                                              
The board  member could  actively participate  in drafting  an RFP                                                              
and then  submit a proposal and  be awarded the property  and have                                                              
the board  approve it.   She thought  that to  be one of  the true                                                              
forms of conflict of interest.                                                                                                  
                                                                                                                                
SENATOR GREEN  asked Ms. Hickerson  which version of the  bill she                                                              
was working from.                                                                                                               
                                                                                                                                
MS. HICKERSON  said the version  she received from  Representative                                                              
James' office this morning.                                                                                                     
                                                                                                                                
SENATOR GREEN asked Ms. Hickerson  if she was working from Version                                                              
Q.                                                                                                                              
                                                                                                                                
MS. HICKERSON said she was.                                                                                                     
                                                                                                                                
CHAIRMAN HALFORD announced that the  committee would recess to the                                                              
call of the  Chair to allow  Senators to attend the  floor session                                                              
and to allow time  for more work to be done on the  bill.  He then                                                              
recessed the meeting at 3:43 p.m.                                                                                               

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