Legislature(2003 - 2004)
05/08/2003 04:03 PM Senate RES
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ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
May 8, 2003
4:03 p.m.
MEMBERS PRESENT
Senator Scott Ogan, Chair
Senator Thomas Wagoner, Vice Chair
Senator Ralph Seekins
Senator Ben Stevens
Senator Georgianna Lincoln
MEMBERS ABSENT
Senator Fred Dyson
Senator Kim Elton
COMMITTEE CALENDAR
CS FOR HOUSE BILL NO. 61(FIN)
"An Act establishing an exploration and development incentive
tax credit for operators and working interest owners directly
engaged in the exploration for and development of gas for sale
and delivery without reference to volume from a lease or
property in the state; and providing for an effective date."
MOVED SCS CSHB 61(RES) OUT OF COMMITTEE
CS FOR HOUSE BILL NO. 118(RES) am
"An Act relating to the transportation and sale of certain
commercially caught fish by an agent of a commercial fishing
permit holder and to the sale of fish; and providing for an
effective date."
MOVED CSHB 118(RES) am OUT OF COMMITTEE
PREVIOUS ACTION
HB 61 - See Resources minutes dated 5/7/03
HB 118 - See Labor and Commerce minutes dated 4/8/03 and 4/15/03
WITNESS REGISTER
Mr. Larry Houle
Alaska Support Industry Alliance
POSITION STATEMENT: Supports SCS CSHB 61(RES)
Representative Paul Seaton
Alaska State Capitol
Juneau, AK 99801-1182
POSITION STATEMENT: Sponsor of HB 118
Mr. Doug Mecum
Director, Division of Commercial Fisheries
Department of Fish & Game
PO Box 25526
Juneau, AK 99802-5226
POSITION STATEMENT: Supports CSHB 118(RES) am
ACTION NARRATIVE
TAPE 03-44, SIDE A
Number 0001
CHAIR SCOTT OGAN called the Senate Resources Standing Committee
meeting to order at 4:03 p.m. Senators Wagoner, Stevens, Seekins
and Chair Ogan were present. Senator Elton was excused for
medical reasons and Senator Dyson was attending another
committee hearing. The first order of business to come before
the committee was HB 61.
HB 61-OIL & GAS TAX CREDIT FOR EXPLORATION/DEV
CHAIR OGAN informed committee members that the bill contains a
10-year sunset provision. He wrestled with the idea of
shortening that timeframe but instead decided to propose an
amendment [Amendment 1] that treats the problem in a different
manner.
Amendment 1 reads as follows.
23-LS0270\S.1
Chenoweth
A M E N D M E N T 1
OFFERED IN THE SENATE BY SENATOR OGAN
TO: CSHB 61(FIN)
Page 4, following line 30:
Insert a new bill section to read:
"* Sec. 4. The uncodified law of the State of Alaska is
amended by adding a new section to read:
REPORT ON EFFECT OF GAS EXPLORATION AND DEVELOPMENT TAX
CREDIT. Not later than November 30, 2008, the Department of
Revenue shall prepare and publish a report on the effect of the
gas exploration and development tax credit authorized by
AS 43.20.043, added by sec. 1 of this Act. The department shall
advise the legislature of the availability of the report and,
within the first 10 days of the First Regular Session of the
Twenty-Sixth Alaska State Legislature, transmit copies of the
report to the chairs or co-chairs of the House and Senate
Resources Committees and the chairs or co-chairs of the House
and Senate Special Committees on Oil and Gas, if established.
The report must address
(1) the number of successful gas discoveries for which
a tax credit is provided under AS 43.20.043;
(2) the volume or amount of new gas reserves brought
into production for which a tax credit is provided under
AS 43.20.043;
(3) the total credits allowed under AS 43.20.043 that
are applied to the tax liability through the date of preparation
of the report;
(4) the total credits applied for under AS 43.20.043
that are not yet approved as of the date of preparation of the
report;
(5) royalties obtained and oil and gas property
production taxes paid from new gas production and anticipated
from gas production for production for which credits are allowed
under AS 43.20.043; and
(6) any other information that, in the judgment of the
commissioner of revenue, would evaluate the effectiveness of the
gas exploration and development tax credit authorized under
AS 43.20.043."
Renumber the following bill sections accordingly.
Page 5, line 1:
Delete "sec. 4"
Insert "sec. 5"
SENATOR WAGONER objected to the adoption of Amendment 1 for the
purpose of discussion.
CHAIR OGAN explained that Amendment 1 instructs the Department
of Revenue (DOR) to provide a report in five years. The report
is to contain information specific to items 1 through 6 listed
in the amendment. That report will let the legislature know how
this program is working out in 5 years from now. He believes
that is a better approach than sunsetting the program, which is
cause for uncertainty. The report will be delivered to the House
and Senate Resources Committee co-chairs and House and Senate
Special Committees on Oil and Gas, if established.
SENATOR WAGONER withdrew his objection to the adoption of
Amendment 1, therefore it was adopted.
CHAIR OGAN announced that Mr. Logsdon was available to answer
questions. With no questions, he took public testimony.
MR. LARRY HOULE, Alaska Support Industry Alliance, stated strong
support for this legislation. It is a successful efforts bill,
meaning no credits are given for dry holes. The Alliance sees
this as the proper role of government and applauds the sponsor
for introducing this legislation.
[SENATOR LINCOLN arrived.]
SENATOR WAGONER moved SCS CSHB 61(RES) from committee with
individual recommendations and its zero fiscal note. There being
no objection, the motion carried.
CHAIR OGAN announced an at-ease.
HB 118-TRANSPORTATION OF COMMERCIAL FISH
REPRESENTATIVE PAUL SEATON, sponsor of HB 118, informed
committee members that HB 118 gives fishermen another tool to
get better quality fish to market while reducing costs and
provides the Alaska Department of Fish and Game (ADF&G) with a
better mechanism to keep track of fish. Fishermen will have a
legal way to consolidate catches, record that information, and
move those fish to market.
CHAIR OGAN asked who opposes the bill.
REPRESENTATIVE PAUL SEATON said no one has opposed this
legislation.
CHAIR OGAN asked if this legislation will "put a few guys in the
fish transport business...?"
REPRESENTATIVE SEATON agreed and added a number of fishermen
with small catches will be able to aggregate their catches on
one boat and make up the fish ticket on each fisherman's catch.
That way, only one boat will have to run the fish to town
without everyone having to leave the fishing grounds or hold the
fish longer. That will provide for better quality fish and
reduce fuel expenses.
SENATOR WAGONER said about six or eight boats fished Chinitna
Bay after the season was over [last year] in Cook Inlet. Those
boats had an 8-hour run to sell their minimal amount of fish.
This bill will allow those fishermen to combine their catches
and have one boat make the run.
REPRESENTATIVE SEATON pointed out that a quirk in current law
requires the fisherman to be at the point of sale so a fisher
cannot make a fish ticket and have those fish delivered by
another fisherman.
MR. DOUG MECUM, Director of the Division of Commercial
Fisheries, ADF&G, said he was available to answer questions.
CHAIR OGAN asked Mr. Mecum to review the history of why this has
not been allowed in the past.
MR. MECUM said this legislation covers all of ADF&G's concerns.
It has worked with the Departments of Law and Public Safety and
finds the bill contains adequate protections to ensure that
ADF&G gets accurate data, which has been its main concern. He
explained that the current statutory requirement that fishermen
be present at the point of sale was imposed for the purpose of
enforcement of fishing regulations and tracking. This
legislation modifies that statute. The Division of Wildlife
Protection will be able to track down where and when the fish
were caught.
CHAIR OGAN asked if the Division of Wildlife Protection supports
this legislation.
MR. MECUM said that division is comfortable with this
legislation. Major Cockrell has testified at least three times
to that effect.
There being no further questions or discussion, SENATOR WAGONER
moved CSHB 118(RES) am out of committee with individual
recommendations and its attached fiscal note.
CHAIR OGAN announced that without objection, the motion carried.
He then adjourned the meeting at 4:23 p.m.
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