Legislature(1995 - 1996)
05/03/1995 03:45 PM Senate RES
| Audio | Topic |
|---|
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| HB 195 | |||
| HJR 44 | |||
| SJR 23 | |||
| HJR 43 | |||
| HB 207 | |||
| HB 141 |
SENATE RESOURCES COMMITTEE
May 3, 1995
3:45 p.m.
MEMBERS PRESENT
Senator Loren Leman, Chairman
Senator Drue Pearce, Vice Chairman
Senator Rick Halford
Senator Robin Taylor
Senator Georgianna Lincoln
Senator Lyman Hoffman
MEMBERS ABSENT
Senator Steve Frank
ALSO IN ATTENDANCE
Senator John Torgerson
COMMITTEE CALENDAR
CS FOR HOUSE BILL NO. 195(RES)
"An Act repealing the laws authorizing milk marketing orders."
HOUSE JOINT RESOLUTION NO. 44
Proposing postage stamps honoring wild Alaska salmon and centuries
of continued use of wild Alaska salmon for subsistence, sport, and
commercial fish harvesters.
CS FOR HOUSE JOINT RESOLUTION NO. 43(FSH)
Relating to commercial fishing and subsistence use in Glacier Bay
National Park.
CS FOR HOUSE BILL NO. 207(FIN) am
"An Act relating to adjustments to royalty reserved to the state to
encourage otherwise uneconomic production of oil and gas; and
providing for an effective date."
CS FOR HOUSE BILL NO. 141(FSH)
"An Act relating to the appointment of members of the Board of
Fisheries."
PREVIOUS SENATE COMMITTEE ACTION
HB 195 - No previous action to record.
HJR 44 - No previous action to record.
HJR 43 - No previous action to record.
HB 207 - See Resources minutes dated 4/22/95, 4/26/95, 4/28/95,
5/1/95.
HB 141 - See Resources minutes dated 4/22/95.
WITNESS REGISTER
Odette Foster, Staff to Representative Kim Elton
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Offered information on HJR 44
Amy Daugherty, Staff to Representative Alan Austerman
State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Offered information on HJR 43
Ron Sommerville
Juneau, AK
POSITION STATEMENT: Offered information on HJR 43
Bruce Weyhrauch
302 Gold St.
Juneau, AK 99801
POSITION STATEMENT: Offered information in support of HJR 43
Commissioner John Shively
Department of Natural Resources
400 Willoughby Ave.
Juneau, AK 99801-1796
POSITION STATEMENT: Offered information on CSHB 207(FIN) am
and SCS CSHB 207(RES)
Ken Boyd, Director
Division of Oil & Gas
Department of Natural Resources
3601 C St., Suite 1380
Anchorage, AK 99503-5948
POSITION STATEMENT: Offered information on CSHB 207(FIN) am
and SCS CSHB 207(RES)
Steve Lewis, Chairman & CEO
Petro Star Refinery
201 Arctic Slope Ave., #200
Anchorage, AK 99518-3030
POSITION STATEMENT: Testified in support of CSHB 207(FIN) am
Pam Neal, President
Alaska State Chamber of Commerce
217 2nd St., #201
Juneau, AK 99801
POSITION STATEMENT: Testified in support of CSHB 207(FIN) am
ACTION NARRATIVE
TAPE 95-54, SIDE A
Number 001
HJR 44 POSTAGE STAMP HONORING ALASKA SALMON
CHAIRMAN LEMAN called the Senate Resources Committee meeting to
order at 3:45 p.m. He brought HJR 44 before the committee as the
first order of business.
ODETTE FOSTER, staff to Representative Kim Elton, who is prime
sponsor of HJR 44, said the resolution requests the U.S. Postmaster
to issue a series of five postage stamps, each depicting one of
Alaska's salmon species. The postage stamp series will focus
national attention on Alaska's thriving and healthy salmon fishery.
Representative Elton believes that by creating more awareness of
Alaska wild salmon it is easier to educate those outside of Alaska
about one of our most important and economically viable resources.
SENATOR LEMAN stated HJR 44 would be held until a quorum of the
committee was established.
Number 080
CSHJR 43(FSH) FISHING AND SUBSISTENCE IN GLACIER BAY
CSHJR 43(FSH) was before the committee as the next order of
business.
AMY DAUGHERTY, staff to the House Special Committee on Fisheries,
said the resolution was introduced by the committee in response to
concerns expressed by commercial fishermen and subsistence users.
In 1991 the National Park Service promulgated draft regulations
that would phase out commercial fishing in and around Glacier Bay
within seven years and completely prohibit subsistence fishing.
Last year a federal judge ruled that ANILCA did not prohibit
commercial fishing in Glacier Bay National Park, but that ruling
has been appealed to the Ninth Circuit Court of Appeals.
Ms. Daugherty said elimination of the commercial and subsistence
fisheries in a vast area contained in the Glacier Bay National Park
would significantly harm the coastal communities of northern
Southeast Alaska.
Number 110
RON SOMMERVILLE said there is still a conflict over state
jurisdiction of navigable waters although the state has never filed
quiet title to the submerged lands within the boundaries of Glacier
Bay National Park. The state has consistently taken the position
in the past that it reserved the rights to file quiet title, and at
the same time, exercise some jurisdiction over the resources in the
water column.
Mr. Sommerville said the conflict is over transient resources which
are not really part of the park. Both the subsistence and
commercial uses in there provide very little, if any, jeopardy to
park resources. However, the National Park has consistently taken
the position that it can regulate or eliminate commercial fishing
and subsistence fishing within the park boundaries. So far, the
courts have shown that the Park Service has and can allow
commercial and subsistence within the boundaries of the park.
Mr. Sommerville said it is hoped that as the National Park Service
goes forward with its regulations that commercial fishing and
subsistence are allowed uses in the park.
Number 166
SENATOR LINCOLN asked Mr. Sommerville how he would define
"subsistence use" as used in the resolution. RON SOMMERVILLE
responded that the definition is exactly the same as the
subsistence priority in Title 8 of federal law.
Number 214
SENATOR HOFFMAN noted that one of the resolve clauses in the
resolution also speaks to sport fishing, and he asked what sport
fishing issue there is in Glacier Bay. RON SOMMERVILLE replied
that the National Park Service allows sport fishing within its
boundaries, but they have always taken the position that commercial
fishing and subsistence use have to be specifically authorized by
Congress. This has consistently created a problem within Glacier
Bay.
Number 230
BRUCE WEYHRAUCH, representing Allied Fishermen of Southeast Alaska,
explained he represented that group when they intervened in a case
entitled "Alaska Wildlife Alliance versus Jensen." The fishermen
wanted to intervene in the case because if they were excluded from
those waters it would mean several things: they would have to move
operations to other fisheries and other grounds elsewhere in
Southeast Alaska, which would mean increasing pressure on those
other fisheries; it would have a serious social effect on the small
communities in the area that have relied on that fishery; and it
would have a tremendous economic effect on the region.
Mr. Weyhrauch said when Allied Fishermen of Southeast Alaska
intervened in this case, the only decision that Judge Holland ruled
on was whether ANILCA prohibited commercial fishing in the marine
waters of Glacier Bay National Park. The judge ruled that it did
not and that is now on appeal to the Ninth Circuit Court. He said
the Ninth Circuit Court may rule on the case at the end of the
current year or early next year.
Number 275
SENATOR LINCOLN asked if in Judge Holland's ruling there was any
discussion on subsistence use and sport fishing in the area, and
BRUCE WEYHRAUCH answered that just commercial fishing was briefed
in the ruling.
Number 297
There being no further discussion on CSHJR 43(FSH), SENATOR LEMAN
asked for the pleasure of the committee.
SENATOR PEARCE moved that CSHJR 43(FSH) be passed out of committee
with individual recommendations. Hearing no objection, it was so
ordered.
SENATOR LEMAN brought HJR 44 back before the committee and asked
for the pleasure of the committee.
SENATOR PEARCE moved that HJR 44 be passed out of committee with
individual recommendations. Hearing no objection, it was so
ordered.
CSHB 195(RES) REPEAL MILK MARKETING LAWS
SENATOR LEMAN brought CSHB 195(RES) before the committee as the
next order of business.
SENATOR PEARCE read into the record a statement that the Milk
Marketing Board was repealed by the 18th Legislature and this will
get rid of an overabundance of useless statutes.
SENATOR PEARCE moved that CSHB 195(RES) be passed out of committee
with individual recommendations. Hearing no objection, it was so
ordered.
Number 325
CSHB 207(FIN) am ADJUSTMENTS TO OIL AND GAS ROYALTIES
SENATOR LEMAN brought CSHB 207(FIN) am before the committee and
requested a motion to adopt the Resources SCS.
SENATOR PEARCE moved that SCS CSHB 207(RES), version "B", dated
4/29/95, be adopted as a working document. SENATOR LINCOLN
objected. There not being sufficient votes present to adopt the
Resources SCS, SENATOR LEMAN stated the committee would continue
with testimony on the legislation.
Number 335
STEVE LEWIS, Chairman of the Board & CEO of Petro Star, testified
on behalf of Petro Star and the Arctic Slope Regional Corporation.
Mr. Lewis stated there are several areas of concern with changing
the legislation that passed the House, which they believe is a good
bill and should be before the Senate for a vote.
Mr. Lewis outlined the following major areas of concern which are:
(1) Legislative oversight and approval of the commissioner's
decisions, which they believe is adequate as it exists now. They
believe it will create confidentiality problems.
(2) Pools or portions of pools in a field is of particular
importance to them and they feel this is an area that should not be
amended.
(3) They believe the sunset provision is bad public policy
and will send an adverse signal to the oil industry worldwide, not
only the existing industry that exists in the state now, but any
new industry as well.
Concluding his comments, Mr. Lewis requested that the committee
pass out the House version of the bill.
Number 420
SENATOR LEMAN asked Mr. Lewis if he is aware of anywhere else in
the world where previously leased and undeveloped properties become
eligible for negotiated adjustments of royalties. STEVE LEWIS
answered that he believes Alberta may have a similar provision on
leasing. He said there is an upside and downside to this; it is
asking the state to help develop marginal fields, but if those
fields turn out to be much more profitable or if the price of oil
changes, then the state benefits. He added that throughout the
rest of the world the oil industry is going in and developing those
fields, so the incentives are there over Alaska or they would be
here.
SENATOR LEMAN asked Mr. Lewis if he was aware that the state of
Alaska has sunsets on nearly all of its boards and commissions.
STEVE LEWIS responded that the boards and commissions are not
trying to intrigue outside investors to put basically billions of
dollars into this economy and try to develop fields when they can
go elsewhere to invest their money.
Number 455
SENATOR PEARCE pointed out that countries, whether it is Mexico,
Columbia, Peru, China, etc., don't have democracies like ours and
the sunset is the next time there is a new government. They try
things and they see how they work, then they may go back and change
them, or they may get rid of them altogether. She does not believe
having a sunset on legislation sends the wrong signal to the world;
it says we're willing to try it and then we're willing to come back
to whether or not it worked. STEVE LEWIS agreed that some of these
countries are more unstable as far as politics go, but they are at
least offering something as far as rewards, or the returns are
there. He added the state will not entice money and develop a
field in three and a half years. SENATOR PEARCE said the
legislature is being told that if this legislation is not passed in
the next 10 days, there is not going to be a Badami field. The
fields we are talking about are already there, and we're not
talking about new exploration in this royalty reduction section,
she said.
Number 500
SENATOR LEMAN stated he has long been an advocate for royalty
flexibility, continues to be so, and thinks we need to do things to
help encourage the industry to invest in Alaska, but it needs to be
done in such a way that it also protects the interests of Alaska.
That is the purpose of the bill and the work that has been done --
trying to create adequate guidance so this can be done.
SENATOR LEMAN asked Mr. Lewis if he has any particular problems
with a committee of the legislature being briefed on the details of
an agreement where they could go into executive session when there
was information that should not be revealed to the public, and
information that should not be revealed to legislators could be
revealed with agents of the Legislative Budget & Audit Committee,
which has a confidentiality requirement. STEVE LEWIS responded
that he was more comfortable with Legislative Budget & Audit than
with the legislators, who may be here for two years and then be
back out in the public.
Number 548
PAM NEAL, President, Alaska State Chamber of Commerce, voiced their
support for CSHB 207(FIN) am. The Chamber is concerned that jobs
are leaving the state due to the declining activity within the oil
industry, and they believe the House version would encourage the
state's largest industry to spend more of its dollars creating more
activity and businesses in the support industries that supply so
many of the jobs in the state today.
TAPE 95-54, SIDE B
Number 030
SENATOR LINCOLN asked if the State Chamber is supporting the House
version because that's what the oil industry wants. PAM NEAL
replied that they are not supporting it because it is what the oil
industry wants. They are doing it because they understand that the
oil industry is going to base a lot of its decisions as to how much
money to invest in this state in the future based on this
legislation.
Number 085
SENATOR LEMAN invited Commissioner Shively and Ken Boyd of the
Department of Natural Resources to join the committee at the table.
SENATOR LEMAN said the governor's proposal for existing oil fields
was to set the floor at a maximum royalty reduction of 3.8 percent,
which the House reduced to 1.25 percent, and the Resources SCS
brings it back up to 3 percent. He asked the administration's
position on where they would like to see that floor set.
COMMISSIONER SHIVELY
responded that they believe that the floors in the proposed
committee substitute are more in line with their thinking than in
the House bill, and it is a change they had suggested in the House.
Number 130
SENATOR PEARCE said as far as she can see, the issue boils down to
three things: the first is oversight, the second is sunset, and
the third is pool versus field. She asked if the governor opposes
the sunset clause, and COMMISSIONER SHIVELY responded that he does.
There was extensive discussion on the issue of a pool versus a
field. KEN BOYD explained that a field can be composed of two
pools. Under current law, those two pools cannot be distinguished,
and the royalty reduction would have to be granted to the entire
field. Under the House version, the royalty reduction could be
granted to either pool or to both pools. He said it is a matter of
flexibility, and being able to grant this on a lease by lease basis
gives the commissioner more latitude to make a real sensible
decision. COMMISSIONER SHIVELY added that right now, if it wasn't
economic and they really wanted to produce a field, they would be
forced under the Senate bill to give a royalty to both pools in a
field, but the House bill allows them to make a distinction.
Proving the economics on parts of the field that are at the edges
that deserve royalty reduction are going to much more difficult
than looking at separate pools in the same lease where you really
have economics relating right to that pool. SENATOR PEARCE said
she agrees with having pool by pool latitude, but she does not want
to see a different royalty at the edge of a field than we've got at
the middle of a field.
Number 290
SENATOR LEMAN said the immediate impetus for the (1)(A) provisions,
according to testimony, is Badami and, perhaps, North Star. He
asked if we didn't change that to the pool or portion of the field
or pool, is there anything in the Resources SCS that would affect
that project. KEN BOYD answered that wells that are drilling at
Badami now are held confidential and he didn't want to comment on
it, but he acknowledged that it is possible.
Number 330
The committee took an at ease at 5:02 p.m. and was called back to
order at 5:50 p.m.
Number 335
SENATOR LINCOLN moved and unanimous consent that CSHB 207(FIN) be
passed out of committee with individual recommendations. SENATOR
PEARCE objected.
Speaking to her motion, SENATOR LINCOLN stated a lot of testimony
has been taken on the bill and people are overwhelmingly leaning
towards that version of the bill. She added that amendments could
be made to the House version to improve it, but she suggested it
could be the vehicle in which amendments could be tacked on in the
Senate Finance Committee. SENATOR LEMAN disagreed and said he
thought it would slow the legislation down and may cause it to not
be moved this year.
SENATOR LEMAN stated there would be a roll call vote on Senator
Lincoln's motion to move CSHB 207(FIN) out of committee. The roll
was taken with the following result: Senators Lincoln and Hoffman
voted "Yea" and Senators Leman, Pearce and Taylor voted "Nay." The
motion failed.
Number 400
SENATOR PEARCE moved that SCS CSHB 207(RES), version "B", dated
4/29/95, be adopted as a working document. Hearing no objection,
the motion carried.
SENATOR LEMAN stated the committee would take up amendments
prepared by himself and Senator Pearce.
Number 430
SENATOR PEARCE moved adoption of the following Amendment No. 1 to
SCS CSHB 207(RES). She said the effect of the amendment is to
leave out the disclosure of financial and technical data related to
marketing, which is an area of concern.
Amendment No. 1
Page 4, line 14: Delete " production, transportation, and
marketing "
Insert " production, and transportation "
Hearing no objection to Amendment No. 1, SENATOR LEMAN stated it
was adopted.
Number 455
SENATOR PEARCE moved adoption of the following Amendment No. 2.
She said there was a concern with trying to define "social effects"
and that if you tried to delineate everything that has to be in the
findings and determinations, leaving the word "social" in would
only lead to a lawsuit. COMMISSIONER SHIVELY stated it was the
department's recommendation to delete all of paragraph (9).
Amendment No. 2
Page 5, line 13: Delete " social "
Page 5, line 14: Delete" ,including its effects "
Hearing no objection to Amendment No. 2, SENATOR LEMAN stated it
was adopted.
Number 515
SENATOR PEARCE moved adoption of the following Amendment No. 3,
which was suggested by the Department of Natural Resources.
COMMISSIONER SHIVELY stated support for the amendment.
Amendment No. 3
Page 8, line 29: Delete " increase or "
Delete " or otherwise adjust "
Page 9, line 11: Delete " increase or "
Page 9, line 12: Delete " or otherwise adjust "
Page 9, line 21: Delete " increase or "
Delete " or otherwise adjust "
Hearing no objection, SENATOR LEMAN stated Amendment No. 3 was
adopted.
Number 545
SENATOR PEARCE moved adoption of the following Amendment No. 4.
Amendment No. 4
Page 1, line 8: Delete "marketing"
Page 2, line 19: Delete " increase ,"
Page 2, line 20: After " decrease " delete " , "
Page 3, line 5: After " including " insert " price, "
Page 3, line 6: After " recovery, " delete " or " & insert "
After " development " delete " and " & insert " , "
After " operating " insert " , and transportation "
Page 3, line 9: Delete " a share of net profits, "
Page 4, line 26: Delete " marketing "
After brief discussion on the amendment and no objection to its
adoption, SENATOR LEMAN stated Amendment No. 4 was adopted.
TAPE 95-55, SIDE A
Number 001
SENATOR LEMAN stated Amendment No. 5 was before the committee.
Amendment No. 5
Page 3, line 19:
Delete " (i) "
Page 3, line 22:
Delete " or "
Page 3, lines 23 - 29:
Delete all material.
Page 4, lines 18 - 22:
Delete all material and insert:
" (B) keep the data described in (A) of this
paragraph confidential under AS38.05.035(a)(9) at the
request of the lessee or lessees making application for
the royalty increase or decrease or other royalty
adjustment; the data
(i) at the direction of the majority of
the members of the Legislative Budget and Audit
Committee, may be disclosed by the commissioner
only to the legislative auditor, the director of
the division of legislative finance, and the
permanent employees of their respective divisions,
and to agents or contractors of the legislative
auditor or the legislative finance division
director who are engaged under contract to evaluate
the royalty increase, decrease, or other royalty
adjustment;
(ii) may not be disclosed to
legislators; "
Page 4, line 30, through page 5, line 2:
Delete all material and insert:
" (8) shall
(A) make and publish a preliminary findings
and determination on the royalty increase, decrease, or
other adjustment application; if the preliminary findings
and determination concerns a royalty increase, decrease,
or other adjustment under (1)(A) of this subsection, the
preliminary findings and determination shall also be
presented to the governor for the governor's approval or
disapproval; the governor may not delegate a
determination to approve or disapprove a preliminary
findings and determination under this subparagraph;
(B) if the governor approves the preliminary
findings and determination under (A) of this paragraph,
(i) give reasonable public notice of the
preliminary findings and determination;
(ii) concurrently with the issuance of
the public notice, if directed by the Legislative
Budget and Audit Committee, make available copies
of the commissioner's preliminary findings and
determination on the royalty increase, decrease, or
other adjustment application and the supporting
financial and technical data, including the work
papers, analyses, and recommendations of any
contractors retained under (7) of this subsection,
to persons authorized under (6)(B) of this
subsection to review the data; and
(iii) invite public comment on the
preliminary findings and determination during a 30-
day period for receipt of public comment; "
Page 5, line 21, through page 6, line 15:
Delete all material and insert:
" (10) shall offer to appear before the Legislative
Budget and Audit Committee on a day that is not earlier than
10 days and not later than 20 days after giving public notice
under (8) of this subsection, to provide the committee a
review of the commissioner's preliminary findings and
determination on the royalty increase, decrease, or other
adjustment application and the supporting financial and
technical data; if the Legislative Budget and Audit Committee
accepts the commissioner's offer, the committee shall give
notice of the committee's meeting to all members of the
legislature; if, under (6)(B) of this subsection, the
financial and technical data must be kept confidential at the
request of a lessee or lessees making application for the
royalty increase or decrease or other royalty adjustment, the
commissioner may appear before the committee in executive
session; "
Page 6, line 31, through page 8, line 4:
Delete all material and insert:
" (12) shall, within 30 days after the close of the
public comment period under (8) of this subsection,
(A) prepare a summary of the public response
to the commissioner's preliminary findings and
determination;
(B) except as to a final findings and
determination proposed for a royalty increase, decrease,
or other adjustment under (1)(A) of this subsection,
make a final findings and determination; the
commissioner's final findings and determination prepared
under this subparagraph regarding a royalty increase,
decrease, or other adjustment is, as to the lessee or
lessees applying for the royalty increase, decrease, or
other adjustment, final and not appealable to the court;
(C) as to a final findings and determination
prepared for a royalty increase, decrease, or other
adjustment under (1)(A) of this subsection, make a final
findings and determination and present it to the governor
for the governor's approval or disapproval; the governor
may not delegate a decision to approve or disapprove a
final findings and decision presented under this
subparagraph; the commissioner's final findings and
determination regarding a royalty increase, decrease, or
other adjustment prepared under this subparagraph, if
approved by the governor, is, as to the lessee or lessees
applying for the royalty increase, decrease, or other
adjustment, final and not appealable to the court; "
Reletter the following subparagraphs accordingly.
Page 8, line 6:
Delete " (A) or (B) "
Insert " (B) or (C) "
SENATOR PEARCE, speaking to Amendment No. 5, which she had drafted,
explained that the amendment changes the scheme for royalty
adjustments in fields that have never been produced, but does not
require legislative oversight. Instead, the preliminary findings
have to be developed by the commissioner and then approved by the
governor, and that approval cannot be delegated to any other
individual. Those findings then go to public comment, as was
already in the scheme, and they also go to the Legislative Budget
Audit Committee. After the public comment period and everybody
comes back with a final determination and a final decision, once
again, the decision on that royalty reduction is signed by the
governor and that authority cannot be delegated. If any
confidential information comes along with the preliminary findings,
it would be available to the staff who would fit under the same
confidentiality laws that the commissioner's staff fits under.
However, that confidential information would not be available
directly to the legislature, but the legislature would still be
privy to the same amount of information that it would normally hear
on tax matters in an executive session.
SENATOR PEARCE moved adoption of Amendment No. 5. SENATOR LINCOLN
objected and stated that she had not have time to review the
amendment.
Number 050
COMMISSIONER SHIVELY commented that the administration has not had
an opportunity to discuss the concept outlined by Senator Pearce,
and he is personally unaware of other decisions that are made in
government that the governor signs. He was unsure of what the
legal ramifications of the amendment would be.
Number 100
SENATOR LEMAN clarified that the amendment does not totally remove
legislative oversight. It removes the ability of the legislature
to approve or disapprove, but it keeps oversight in through the
Legislative Budget & Audit Committee. It provides further
protections regarding confidential information. It addresses the
four concerns that have been identified to the committee by those
in the oil industry. He added that he believes the amendment
crafts a solution that is acceptable.
There being no further discussion on Amendment No. 5, SENATOR LEMAN
stated a roll call vote on its adoption would be taken. The roll
was taken with the following result: Senators Leman, Pearce and
Taylor voted "Yea" and Senators Hoffman and Lincoln voted "Nay."
SENATOR LEMAN stated Amendment No. 5 was adopted.
Number 160
SENATOR PEARCE restated her concern with a royalty reduction for a
well just because it is on the fringe of a field that is a highly
profitable field. She said the commissioner has told her that
language is needed to fix the problem so that he would have the
ability to go in and take care of a pool, but not a field.
SENATOR PEARCE then moved the adoption of the following Amendment
No. 6 with conforming amendments where "or pool" may have to be
added throughout the document.
Amendment No. 6
Page 2, lines 10, 11, 14, 16 & 18: After "field" add "or pool"
Hearing no objection to Senator Pearce's motion, SENATOR LEMAN
stated Amendment No. 6 was adopted.
Number 200
SENATOR PEARCE stated she supports a sunset date, but realizes that
the governor does not. However, she thinks the March 15, 1999 date
is perhaps too early and she suggested changing the date to July 1,
2000, which she believes will give ample time for the fields that
are not presently under production. She then moved adoption of the
following Amendment No. 7.
Amendment No. 7
Page 2, line 10: Delete "March 15, 1999" and insert "July 1, 2000
Number 250
SENATOR LINCOLN requested Commissioner Shively's comments on the
amendment.
COMMISSIONER SHIVELY responded that this is one of areas where they
have some disagreement with Senator Pearce and others. He added
that he understands the arguments of the senators to want to
revisit this, but on the other hand, timing in oil fields is not
quick. They do know of some fields, today, that are delineated,
that they think could qualify under this legislation if the
economics were there. But for fields that are far out in the
future, or even fields that would be leased relatively soon, they
are really far out in the future in terms of their development, and
they believe that this sunset date would send a message to the oil
industry that the state is not receptive to the industry's needs.
SENATOR PEARCE said with this bill she is not necessarily trying to
encourage new exploration; she is trying to encourage the
development of fields that we already have. She believes we should
focus this year on keeping the people and the work that we already
have in Alaska here, and to continue working on exploration
elsewhere.
Number 340
SENATOR HOFFMAN moved to amend Amendment No. 7 to eliminate the
sunset provision. SENATOR PEARCE objected to the amendment to
Amendment No. 7. SENATOR LEMAN called for a hand vote. Senators
Hoffman and Lincoln voted "Yea" and Senators Pearce, Taylor and
Leman voted "Nay." SENATOR LEMAN stated the motion failed.
Number 376
SENATOR LEMAN then called for a hand vote on the adoption of
Amendment No. 7. Senators Taylor, Pearce and Leman voted "Yea" and
Senators Lincoln and Hoffman voted "Nay." SENATOR LEMAN stated
Amendment No. 7 was adopted.
Number 385
SENATOR PEARCE then moved the adoption of Amendment No. 8 as
proposed by Senator Leman. SENATOR LEMAN explained the amendment
shortens up the phraseology and makes it much clearer.
Amendment No. 8
Page 7, line 6 - 11: Change sub-subparagraph (ii) to read as
follows:
(ii) make a final findings and determination which is final
and not appealable to the court by the lessee or lessees;
COMMISSIONER SHIVELY stated the administration has no objection to
the amendment.
Hearing no objection to Amendment No. 8, SENATOR LEMAN stated it
was adopted.
Number 425
SENATOR TORGERSON stated that although he did not have a proposed
amendment, he has concern with subparagraph (B) on page 5, lines 7
- 12. He said it speaks to actual capital investment or other
beneficial spending. In some cases, such as platforms in Cook
Inlet where the production levels might be very low, they might
request reductions in royalties to keep alive without making an
increased capital investment or beneficial spending. His concern
is that these areas also be eligible for royalty reduction if they
were to maintain the status quo to keep that field going. SENATOR
LEMAN responded his intent is that the Cook Inlet fields and the
continued extension of them would qualify just the same as if doing
new projects. COMMISSIONER SHIVELY agreed, but said that this was
exactly why they wanted to delete paragraph (9) altogether. In
looking at this in the House, it was found that when trying to set
these kinds of standards for the commissioner to look at, there are
different kinds of decisions, different kinds of fields, pools,
etc., and it results in the same kind of problem that Senator
Torgerson pointed out.
SENATOR PEARCE proposed a conceptual Amendment No. 9 to page 5,
lines 3 - 20, that the delineation of what needs to be addressed in
the findings and determination would apply only to the adjustments
under subparagraph (A) on page 2, which are the oil or gas fields
that have been delineated but have not previously produced oil or
gas. She explained this would take care of Senator Torgerson's
concern about aged Cook Inlet fields, and it will make the
commissioner's job less onerous but still give the public the
understanding and the faith that there will be a complete
determination and findings.
SENATOR PEARCE moved her conceptual Amendment No. 9. SENATOR
TAYLOR objected and asked if the amendment would resolve Senator
Torgerson's problem. COMMISSIONER SHIVELY acknowledged that the
amendment would address Senator Torgerson's concern, but there
still could be problems with subparagraph (B) on page 2.
TAPE 95-55, SIDE B
Number 025
After extensive discussion on the amendment, SENATOR TAYLOR removed
his objection. SENATOR LEMAN stated a hand vote would be taken.
The roll was taken with the following result: Senators Lincoln,
Hoffman and Pearce voted "Yea" and Senator Leman voted "Nay."
SENATOR LEMAN stated conceptual Amendment No. 9 was adopted.
The committee then took an at ease at 7:00 p.m. and was called back
to order at 7:30 p.m.
Number 045
SENATOR PEARCE moved that the committee rescind it previous action
in adopting conceptual Amendment No. 9. Hearing no objection,
SENATOR LEMAN stated the committee had rescinded it action in
adopting Amendment No. 9, which brought the amendment back before
the committee.
SENATOR PEARCE moved and asked unanimous consent that she be
allowed to withdraw conceptual Amendment No. 9. Hearing no
objection, the motion carried.
Number 055
SENATOR PEARCE moved the following Amendment No. 10.
Amendment No. 10
Page 5, line 6: After "adjustment" delete ; and add "on the
state's revenue;
Hearing no objection to Amendment No. 10, SENATOR LEMAN stated it
was adopted.
Number 070
SENATOR PEARCE moved the following Amendment No. 11.
Amendment No. 11
Page 2, lines 18 - 20: Delete existing language and replace with
the following language:
(B) to prolong the economic life of an oil or gas field or
pool as cost per barrel or per barrel equivalent increase such that
future production would not otherwise be economically feasible; or
Hearing no objection to Amendment No. 11, SENATOR LEMAN stated it
was adopted.
Number 090
SENATOR LINCOLN offered the following Amendment No. 12.
Amendment No. 12
Page 5, line 3 - 20: Delete paragraph (9) in its entirety and
renumber accordingly.
SENATOR LINCOLN moved Amendment No. 12 and SENATOR PEARCE objected.
A hand vote was taken with the following result: Senators Hoffman
and Lincoln voted "Yea" and Senators Leman, Taylor and Pearce voted
"Nay." SENATOR LEMAN stated the motion failed.
Number 115
There being no further amendments to SCS CSHB 207(RES), SENATOR
LEMAN asked for the pleasure of the committee.
SENATOR PEARCE moved that SCS CSHB 207(RES), as amended, be passed
out of committee with individual recommendations. SENATOR LINCOLN
objected and stated the committee had not addressed the minority's
concerns with the sunset clause and the legislative oversight.
SENATOR LEMAN responded that the committee had been working for
four hours on the bill and had addressed every one of the major
concerns. He then called for a roll call vote. The roll was taken
with the following result: Senators Pearce, Taylor and Leman voted
"Yea" and Senators Lincoln and Hoffman voted "Nay." SENATOR LEMAN
stated the motion to move SCS CSHB 207(RES) from committee failed
because it lacked the necessary four votes to move it.
SENATOR TAYLOR moved that the committee reconsider its action in
failing to move SCS CSHB 207(RES), as amended, from committee.
Hearing no objection, SENATOR LEMAN stated the motion to move SCS
CSHB 207(RES), as amended, from committee was back before the
committee. SENATOR LINCOLN objected. The roll was taken with the
following result: Senators Halford, Taylor and Leman voted "Yea"
and Senators Lincoln, Hoffman and Pearce voted "Nay." SENATOR
LEMAN stated the motion failed and that the bill would be set
aside.
Number 190
CSHB 141(FSH) TERM OF FISH BOARD MEMBERS
SENATOR LEMAN brought CSHB 141(FSH) before the committee as the
next order of business. However, there being no witnesses present
to testify on the bill, he stated it would be set aside.
Number 200
SENATOR LEMAN stated the committee would stand in recess to a call
of the Chairman. He then recessed the meeting at 7:40 p.m.
The meeting was called back to order at 11:35 p.m. However,
because only Senator Leman and Senator Taylor were in attendance
and lacked a quorum to deal with HB 207 and HB 141, SENATOR LEMAN
recessed the meeting at 11:36 p.m. until the following day to a
call of the Chairman.
TAPE 95-56, SIDE A
Number 001
The meeting was called back to order at 2:10 p.m. on May 4.
SENATOR TAYLOR moved that SCS CSHB 207(RES), as amended, be passed
out of committee with individual recommendations. SENATOR HOFFMAN
objected. The roll was taken with the following result: Senators
Pearce, Taylor and Leman voted "Yea" and Senator Hoffman voted
"Nay." SENATOR LEMAN stated the motion failed.
SENATOR LEMAN stated the committee would stand in recess at 2:12
p.m.
The May 3 Senate Resources Committee meeting was formally adjourned
on May 5.
| Document Name | Date/Time | Subjects |
|---|