03/29/2010 03:30 PM Senate RESOURCES
| Audio | Topic |
|---|---|
| Start | |
| SB143 | |
| SB245 | |
| SB255 | |
| HB162 | |
| Adjourn |
+ teleconferenced
= bill was previously heard/scheduled
| *+ | SB 245 | TELECONFERENCED | |
| *+ | SB 255 | TELECONFERENCED | |
| + | HB 162 | TELECONFERENCED | |
| = | SB 143 | ||
| + | TELECONFERENCED |
ALASKA STATE LEGISLATURE
SENATE RESOURCES STANDING COMMITTEE
March 29, 2010
3:33 p.m.
MEMBERS PRESENT
Senator Lesil McGuire, Co-Chair
Senator Bill Wielechowski, Co-Chair
Senator Charlie Huggins, Vice Chair
Senator Hollis French
Senator Bert Stedman
Senator Gary Stevens
Senator Thomas Wagoner
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
SENATE BILL NO. 143
"An Act establishing the Greater Railbelt Energy and
Transmission Corporation and relating to the corporation;
relating to transition, financial plan, and reporting
requirements regarding planning for the initial business
operations of the Greater Railbelt Energy and Transmission
Corporation; relating to a report on legislation regarding the
Regulatory Commission of Alaska and the Greater Railbelt Energy
and Transmission Corporation; authorizing the Alaska Energy
Authority to convey the Bradley Lake Hydroelectric Project and
the Alaska Intertie to the Greater Railbelt Energy and
Transmission Corporation; and providing for an effective date."
- HEARD AND HELD
SENATE BILL NO. 245
"An Act relating to the salmon product development tax credit;
and providing for an effective date by amending an effective
date in sec. 7, ch. 57, SLA 2003, as amended by sec. 4, ch. 3,
SLA 2006, and by sec. 4, ch. 8, SLA 2008."
- HEARD AND HELD
SENATE BILL NO. 255
"An Act relating to sharing records regarding fish purchased by
fish processors with certain federal agencies, to requirements
to obtain and maintain a fisheries business license, and to
payment of industry fees required of fish processors; and
providing for an effective date."
- HEARD AND HELD
HOUSE BILL NO. 162
"An Act establishing the Southeast State Forest and relating to
the Southeast State Forest; and providing for an effective
date."
- HEARD AND HELD
PREVIOUS COMMITTEE ACTION
BILL: SB 143
SHORT TITLE: RAILBELT ENERGY & TRANSMISSION CORP.
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
03/09/09 (S) READ THE FIRST TIME - REFERRALS
03/09/09 (S) ENE, RES, FIN
03/19/09 (S) ENE AT 11:00 AM BUTROVICH 205
03/19/09 (S) Heard & Held
03/19/09 (S) MINUTE(ENE)
04/06/09 (S) ENE AT 5:00 PM BUTROVICH 205
04/06/09 (S) OPPOSE UN DESIGNATION OF ARCTIC OCEAN
04/09/09 (S) ENE AT 2:30 PM BUTROVICH 205
04/09/09 (S) Heard & Held
04/09/09 (S) MINUTE(ENE)
03/17/10 (S) ENE AT 3:30 PM BUTROVICH 205
03/17/10 (S) Heard & Held
03/17/10 (S) MINUTE(ENE)
03/22/10 (S) ENE REFERRAL WAIVED
03/24/10 (S) RES AT 3:30 PM BUTROVICH 205
03/24/10 (S) Heard & Held
03/24/10 (S) MINUTE(RES)
03/25/10 (S) RES AT 3:30 PM BUTROVICH 205
03/25/10 (S) Heard & Held
03/25/10 (S) MINUTE(RES)
BILL: SB 245
SHORT TITLE: SALMON PRODUCT DEVELOP. TAX CREDIT
SPONSOR(s): FINANCE
01/29/10 (S) READ THE FIRST TIME - REFERRALS
01/29/10 (S) RES, FIN
03/29/10 (S) RES AT 3:30 PM BUTROVICH 205
BILL: SB 255
SHORT TITLE: FISH PROCESSOR FEES, LICENSES, RECORDS
SPONSOR(s): OLSON
02/03/10 (S) READ THE FIRST TIME - REFERRALS
02/03/10 (S) RES, FIN
03/29/10 (S) RES AT 3:30 PM BUTROVICH 205
BILL: HB 162
SHORT TITLE: SOUTHEAST STATE FOREST
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR
03/02/09 (H) READ THE FIRST TIME - REFERRALS
03/02/09 (H) RES, FIN
04/08/09 (H) RES AT 1:00 PM BARNES 124
04/08/09 (H) Moved Out of Committee
04/08/09 (H) MINUTE(RES)
04/10/09 (H) RES RPT 7DP 1AM
04/10/09 (H) DP: OLSON, EDGMON, TUCK, SEATON,
WILSON, JOHNSON, NEUMAN
04/10/09 (H) AM: KAWASAKI
04/13/09 (H) FIN RPT 5DP 5NR
04/13/09 (H) DP: THOMAS, FOSTER, AUSTERMAN,
FAIRCLOUGH, JOULE
04/13/09 (H) NR: GARA, CRAWFORD, KELLY, SALMON,
STOLTZE
04/13/09 (H) FIN AT 8:30 AM HOUSE FINANCE 519
04/13/09 (H) Moved Out of Committee
04/13/09 (H) MINUTE(FIN)
04/15/09 (H) TRANSMITTED TO (S)
04/15/09 (H) VERSION: HB 162
04/16/09 (S) READ THE FIRST TIME - REFERRALS
04/16/09 (S) RES
01/20/10 (S) FIN REFERRAL ADDED
03/29/10 (S) RES AT 3:30 PM BUTROVICH 205
WITNESS REGISTER
MARK JOHNSON, General Counsel
Chugach Electric Association &
Staff to the Joint Utility Task Force
POSITION STATEMENT: Supported SB 143.
DARWIN PETERSON
Staff to Senator Stedman
Alaska State Legislature
Juneau, AK
POSITION STATEMENT: Commented on SB 245 for the sponsor.
MARK PALMER
Ocean Beauty Seafoods
POSITION STATEMENT: Supported SB 245.
CHRIS NORRIS
Icicle Seafoods
POSITION STATEMENT: Supported SB 245.
MARY MCDOWELL, Vice President
Pacific Seafood Processors Association
Juneau, AK
POSITION STATEMENT: Supported SB 245.
MARK VINSEL, Executive Director
United Fishermen of Alaska (UFA)
Juneau, AK
POSITION STATEMENT: Supported SB 245.
TIMOTHY COTTONGIM
Tax Division
Department of Revenue (DOR)
Juneau, AK
POSITION STATEMENT: Supported SB 245.
BOB PICKETT, Chairman
Regulatory Commission of Alaska (RCA)
Anchorage, AK
POSITION STATEMENT: Commented on SB 143.
TIM BENINTENDI
Staff to Senator Olson
Alaska State Legislature
Juneau, AK
POSITION STATEMENT: Commented on SB 255 for the sponsor.
ROB ZUANICH, Manager
Southeast Revitalization Association (SRA)
Juneau, AK
POSITION STATEMENT: Supported SB 255.
BOB THORSTENSON, Executive Director
Southeast Alaska Seiners Association (SASA)
Juneau, AK
POSITION STATEMENT: Supported SB 255.
FRANK HOHMAN, Commissioner
Commercial Fisheries Entry Commission (CFEC)
POSITION STATEMENT: Supported SB 255.
JOE PLESHA, General Counsel
Trident Seafoods
POSITION STATEMENT: Supported SB 255.
MARK PALMER, President
Ocean Beauty Seafoods
POSITION STATEMENT: Supported SB 255.
CHRIS MAISCH, Director
Division of Forestry
Department of Natural Resources (DNR)
Juneau, AK
POSITION STATEMENT: Supported HB 162.
DICK COOSE, representing himself
Ketchikan, AK
POSITION STATEMENT: Supported HB 162.
JACK SLAGHT, representing himself
Petersburg, AK
POSITION STATEMENT: Supported HB 162.
OWEN GRAHAM
Alaska Forest Association
Juneau, AK
POSITION STATEMENT: Supported HB 162.
MARK VINSEL, Executive Director
United Fishermen of Alaska (UFA)
Juneau, AK
POSITION STATEMENT: Supported HB 162.
RON WOLFE
Alaska Native Corporation representative to the Board of
Forestry &
Sealaska Corporation Natural Resource Manager
Juneau, AK
POSITION STATEMENT: Supported HB 162.
WAYNE NICOLS, member
State Board of Forestry and Society of American Foresters
Juneau, AK
POSITION STATEMENT: Supported HB 162.
JOHN SANDOR, representing himself
Juneau, AK
POSITION STATEMENT: Supported HB 162.
ACTION NARRATIVE
3:33:56 PM
CO-CHAIR BILL WIELECHOWSKI called the Senate Resources Standing
Committee meeting to order at 3:33 p.m. Present at the call to
order were Senators French, Wagoner, Stevens, Huggins, and
Wielechowski.
SB 143-RAILBELT ENERGY & TRANSMISSION CORP.
3:34:44 PM
CO-CHAIR WIELECHOWSKI announced SB 143 to be up for
consideration. He said they would focus on the issue of how the
new Greater Railbelt Energy and Transmission Corporation (GRETC)
entity would be regulated by the Regulatory Commission of Alaska
(RCA).
3:35:02 PM
MARK JOHNSON, General Counsel, Chugach Electric Association, and
staff to the Joint Utility Task Force as well as former chair of
the RCA, said the task force does not support GRETC regulation
by the RCA, but they have agreed with the Governor's Office to
accept RCA regulation for five years. GRETC, like the utilities
that will provide the governance for it, will operate on a not-
for-profit basis to serve their member owners at the lowest
reasonable cost. GRETC is founded on the Bradley Lake model that
has worked well for 20 years; its books and operations are open
to the public and audits are performed annually. "If you follow
the Bradley Lake model, regulation is unnecessary," he said.
The governance of the boards and the board of GRETC are
democratically elected with one member appointed by the
governor. Mr. Johnson said this makes GRETC very different than
a for-profit utility and it is important to keep this in mind
throughout the discussion on regulation.
MR. JOHNSON said that Chugach does not believe GRETC needs to be
rate regulated, because nationally Chugach finds itself as the
only generation and transmission (G&T) cooperative that accesses
the public markets for all of its financing needs that is
regulated. Financers have told them they are concerned because
this increases risk in financing. They do not want to see GRETC
affected by the same risk.
He related that the state, through the just completed Regional
Integrated Resource Plan (IRP), has looked into the future and
analyzed what energy and transmission are required by comparing
customer needs with what is available, and further what new
resources, power supply and conservation measures can be brought
to bear on those needs. One of the greatest threats to consumer
interest is when utilities make large scale decisions on
investment without a transparent and public process. Currently
the IRP has substantially advanced transparency and public
process. If a utility or GRETC is going to follow the IRP in the
development of a particular project, that project is a
presumptively prudent and necessary investment decision. It
doesn't need additional regulatory review.
He asked the It appears now there are some pretty well defined
regulatory goals.
3:38:29 PM
MR. JOHNSON said the committee to consider regulatory goals in a
broader context and referred them to slide 3 that illustrated
how regulatory goals are addressed through the GRETC
legislation. One of the top ones was to protect consumers; and
the people who will govern and receive the services of GRETC are
the consumers. They will buy the energy and will have an
enormous interest in making sure that electricity and services
are reasonably priced and best serve consumers.
3:39:22 PM
SENATOR STEDMAN joined the committee.
3:40:32 PM
MR. JOHNSON said other more specific goals of regulation were
taken from a treatise called "The Regulation of Public
Utilities" by Charles Phillips. One is that regulation is
intended to prevent monopoly prices. In the case of GRETC the
entities that would be GRETC's customers also have other
options. They are not limited to a monopoly provider in GERTC;
they can choose to self-generate electricity or buy it from
IPPs.
Another goal is an effort to contain and define utility
investments. GRETC will act in compliance with the IRP plan, and
the directors that sit on the board have no interest (since they
are the consumers) in overinvestment. They want the best prices
for the companies that are going to buy energy. He said the
lenders also have a very strong interest in a right size of
utility plant and services.
3:41:45 PM
Along with the regulatory goal of insuring the lowest cost to
consumers, Mr. Johnson said, it's important to remember that the
generation of electricity is one of the few industries and
circumstances where you actually have economies of scale in
production. Consumers benefit from large projects because they
reduce overall costs to them, and that is one of the market
characteristics that exists in the case of electric generation.
MR. JOHNSON said the GRETC utilities have no interest in high
operating costs. When it comes to capital investment, GRETC has
a superior risk profile for investors and will, therefore, have
greater access to capital. So, they believe GRETC is a superior
arrangement in terms of insuring low overall capital cost to
consumers.
As it relates to certain consumer protection issues, whether or
not consumers are being fairly treated in the market place by
providers, Mr. Johnson said, GRETC will not serve retail
customers; the customers are at the wholesale level with the
large electric utilities. So, those concerns do not arise in its
case.
He stated that this legislation also addresses rate
discrimination and that some utilities feared making investments
they could not recover and wanted to be regulated. In the case
of GRETC, they seek to define very clearly how rate making would
take place. Another issue is market failure, and that boils down
to whether or not a utility is required to insure service
availability to various customers. Once again, GRETC has insured
statutorily that it will coordinate the functions of
transmission to distribute electricity throughout the Railbelt.
Also in the category of market failure is the question of
preventing duplicate facilities. If GRETC is complying with the
IRP process, it will have a very exceptional ability to insure
that they have appropriate facilities that serve all the
potential consumers of the energy produced by the utility.
Finally, Mr. Johnson said, the legislation addresses two other
potential regulatory goals - the environment and safety by
providing for the legislature to enact whatever state laws it
thought appropriate in addressing those issues.
3:44:47 PM
MR. JOHNSON said one of the goals over the years regarding
utility regulation is to promote economic development, a matter
of great interest to him when he was on the RCA. In the case of
the GRETC legislation, it is conceived to promote economic
prosperity and to provide low cost energy. They believe it is a
superior model. To sum up, he said, they believe this GRETC
legislation adequately addresses all the goals has see no
compelling need for closely crafted economic regulation.
MR. JOHNSON said in his opinion the legislation has been crafted
to provide a good framework for GRETC to move forward without
regulation. He said regulation is a red flag issue when it comes
to obtaining low cost financing; and the dangers of obtaining
fuel supplies under regulation are well known. Also, he
mentioned a significant risk in inconsistent application of the
regulations. Because statutes rarely provide the kind of
guidance that one would like to have, that unfortunately raises
the prospect that regulators, however well-intentioned, will
reach for solutions that aren't necessarily good ones. This is
not a good risk to take and it won't produce benefits to
consumers. Again, he said, they believe the classic formulation
of regulatory goals is addressed by this legislation.
3:49:09 PM
SENATOR FRENCH asked if anything in the bill forces GRETC to
follow the IRP in the development of a project or is that an
option - in referenced to Mr. Johnson's testimony that if a
utility or GRETC is willing to follow the IRP in the development
of a particular project, that project is a presumptively prudent
and necessary investment decision and it does not need
additional regulatory review.
MR. JOHNSON answered that language on page 12 says that GRETC
will adopt an IRP and follow it.
3:50:33 PM
CO-CHAIR WIELECHOWSKI thanked Mr. Johnson for his testimony and
held the bill. He then announced an at ease from 3:50 to 3:52
p.m.
3:52:00 PM
SB 245-SALMON PRODUCT DEVELOP. TAX CREDIT
3:52:25 PM
CO-CHAIR WIELECHOWSKI called the meeting back to order and
announced SB 245 to be up for consideration.
3:52:43 PM
DARWIN PETERSON, Staff to Senator Stedman, sponsor of SB 245,
said it extends the deadline for salmon processors in Alaska to
apply for their salmon product development tax credit. The
program allows applicants to claim a credit on their annual
fisheries business tax for the purchase of eligible equipment.
Credits received may not exceed 50 percent of a taxpayer's
liability. Under current law, processors can claim the credit
for property first placed in service by December 31, 2001. This
bill would extend that date to December 31, 2015 allowing the
processors ample time to continue their long-range investment
planning that is already in place.
He explained that the salmon product development tax credit was
a key recommendation of the Joint Legislative Salmon Industry
Task Force that was first enacted in 2003 by Senator Stevens.
The credit was part of an effort by the legislature and the
fishing industry to develop innovative value-added salmon
products. Since then the program has stimulated some important
changes in Alaska's commercial fishing industry.
He explained that new processing equipment eligible for the tax
credit enables businesses to offer a more diverse compliment of
Alaska salmon products which helps increase overall customer
acceptance. Modern equipment also helps increase efficiency of
processing operations and improves throughput. This tax credit
also encourages instate processing of out salmon which is
critical to job creation and retention in fishing communities.
MR. PETERSON said that although the Alaska salmon industry is
beginning to recover from years of low values caused by factors
such as competition from fish farming, the industry continues to
be challenged by the recent economic depression, changes in the
market place, and increasing labor and energy costs. Extending
the tax credit beyond its current sunset date of December 31,
2011 will allow the industry to continue the progress that is
being made in developing and producing salmon products that will
keep Alaska's fisheries competitive in the world markets.
3:55:07 PM
MARK PALMER, Ocean Beauty Seafoods, supported SB 245. He said
this tax credit has given Ocean Beauty the ability to change the
complexity of the products they offer to the market.
He explained that when Ocean Beauty first started, the Alaska
salmon industry was headed and gutted frozen fish and lots of
canned salmon. But this bill has given them the ability to
invest in value-added processing equipment that they have put
into four of their seven facilities. The incremental jobs
created with each one of these lines range anywhere from 24-38
employees. In each instance they have also created jobs that go
beyond the peak of the season; it's most efficient to run these
for as many days as possible when you are managing a steady flow
of fish. So, the kinds of jobs they have created in the
communities where their shore-based processing exists lend
themselves to local employment.
The tax credit has also given them the ability to increase
capacity through their production facilities. For example, in
Southeast the pink salmon fishery was always tasked with a
capacity issue, and in the last six years daily production
capacity has increased by 70 percent. In that same time they
have seen grounds prices to fishermen increase by over two and a
half times. In other parts of the state, because they have
premium programs to attract fishermen that have the ability to
ice and bleed and take better care of their fish, they get
better raw material to put into their fillet line. Areas like
Bristol Bay are seeing more and more premiums being paid to the
fleet to deliver higher quality raw materials. So, there is a
direct benefit to the fishermen on these investments, as well.
MR. PALMER said the communities they reside in as a shore-based
processor were generally a large component of the employment
base in them. As they install more equipment they can hire more
people. Developments for Ocean Beauty have accelerated
considerably and he believed it had done so across the industry.
3:58:50 PM
CHRIS NORRIS, Icicle Seafoods, supported SB 245. She said they
process salmon in Southeast, Prince William Sound, Kodiak, Cook
Inlet and Bristol Bay, and they have used the salmon tax credit
to purchase new equipment that has allowed them to develop new
products in all of these areas. She said all of their fishermen
have benefited in the communities they operate in.
3:59:31 PM
SENATOR STEVENS asked how the Alaska fishing industry is doing
compared to farmed salmon.
MS. NORRIS answered that Alaska's wild products are well-
received in the market place. But being in the global market
place is challenging. One of the challenges is competing against
other protein sources in addition to seafood in countries
without environmental, health, and safety regulations and where
their workers don't get paid much.
SENATOR HUGGINS asked how much the tax is worth to them in
dollars and cents.
MS. NORRIS answered that she didn't have annual figures, but she
knew it was a range from a couple hundred thousand up to six
hundred thousand, and she said they didn't use it every year.
She explained that in their business some of the seasons are
very short and sometimes when they purchase new equipment it
takes a while to get it tuned up and running. And you're
reluctant to buy more equipment until the first set is running.
4:01:34 PM
MARY MCDOWELL, Vice President, Pacific Seafood Processors
Association, supported SB 245. She said her association has
member companies with salmon operations in 15 communities around
Alaska including Southeast, Prince William Sound, the Alaska
Peninsula and Bristol Bay. The tax credit is tightly constructed
to accomplish specific goals and it has been very successful so
far. It is a way that Alaska can invest in the future to keep
its products positioned in world markets. She said there were
many letters from companies in their packet who had made good
use of it, but there is still a lot to do.
4:02:36 PM
MARK VINSEL, Executive Director, United Fishermen of Alaska
(UFA), supported SB 245 for the reasons that have already been
stated especially well in the sponsor summary. Getting Alaska's
salmon into a range of products has allowed fishermen to stay in
the business and communities to be able to thrive on their
salmon resource. They can never rest on their laurels, because
the market is very competitive, but increasing sales are coming
from the value-added processing the credit encourages.
SENATOR FRENCH asked if this tax credit should be expanded to
other species.
MR. VINSEL replied that idea is something to keep in mind. Many
professional fishermen have had to diversify into other species.
Some in the farmed salmon industry have had problems, but in the
meanwhile other farmed fish are quite successful in growing
market share.
4:05:13 PM
TIMOTHY COTTONGIM, Tax Division, Department of Revenue (DOR),
said the administration recognizes the benefit this credit has
offered to the processors and supported SB 245.
SENATOR STEDMAN asked for a synopsis of the kinds of equipment
that are being purchased under this program.
MR. COTTONGIM replied that they had seen brining equipment,
curing equipment, fillet lines, filleting machines, blast
freezers, glazers, Ikura packing machines, pin bone machines,
plate freezers, the pop top canning equipment, roe drying
machines, roe rubbing machines, roe separators, roe vibrating
machines, roe washers, skinning machines, smoke houses, and
vacuum packaging machines - to name a majority of them.
SENATOR FRENCH asked for a copy of the list.
SENATOR STEDMAN asked what equipment is excluded.
MR. COTTONGIM answered the same list has a list of things that
don't qualify like building construction, equipment overhauling
costs, retooling, retrofitting (with the exception of pop top
canning), fishing vessels, grinders (dealing with waste),
heading machines that are beyond the heading and gutting
requirement of the value-added salmon product definition,
scales, tables, tools, and totes.
SENATOR STEDMAN noted that the list of inclusions is half the
size of the exclusions. So they have tailored it well.
CO-CHAIR WIELECHOWSKI closed public testimony and held the bill.
4:09:32 PM
SB 143-RAILBELT ENERGY & TRANSMISSION CORP.
CO-CHAIR WIELECHOWSKI announced SB 143 to be back before the
committee. He asked Mr. Pickett to give his thoughts on the
bill.
BOB PICKETT, Chairman, Regulatory Commission of Alaska (RCA),
said he was referring to work draft version S and that the
legislative intent in section on page 2, starting on line 2, was
very critical in this matter. It provides the basis for the
interim five-year period that the RCA is being asked to provide
some sort of regulatory function.
He said that "In setting or reviewing rates" language on page 2,
line 27 was confusing, and explained that generally a utility
sets or changes its rates, files the tariff revision and then
the commission investigates and either approves or modifies
those revisions. He asked in what context the Commission would
actually review rates without setting them. Moving on to "rates
for" he said generally the Commission sets rates "of" the
utility and he wanted to know if something different was meant.
4:11:08 PM
Line 28 said "The Commission may not disallow in traditional
rate making that focuses on the end result just and reasonable
rates." It has none of the intermediate steps of determining the
revenue requirements, rate of return or rate base, and Mr.
Pickett wondered how this would be reviewed by the courts. Will
just and reasonable rates at the end of the process be the
source of the inquiry or will the rate making process now become
a mechanical application of some formula to the component parts?
Towards the end of line 28 in "a rate base or revenue
requirement" he wondered why "a" is used. Will GRETC have more
than one each? It's unclear. The subsection does apply to the
GRETC so the requirements are addressed to a single entity at a
time.
4:12:05 PM
Going down to the line that has "amounts necessarily reasonable"
he asked by what standard "reasonable" would be measured. He
said this is a new concept and asked how will the Commission
would know what a reasonable amount is when it is presented.
What evidence should be produced to support the proposition or
is it sufficient for the management to just assert that it's
reasonable?
On lines 29-30 "for the corporation to fund a cost reasonably
anticipated" Mr. Pickett asked if costs that were anticipated
but never incurred would be subject to repayment to ratepayers
and if costs that are anticipated and incurred but never benefit
ratepayers ever removed from rate base. How do you calculate
depreciation or amortization of an anticipated cost? To become a
just and reasonable cost (line 30) - he said costs themselves
are not generally evaluated as "just and reasonable" except in
the aggregate when the rates themselves are reviewed. The usual
method of evaluating operating costs is whether they are related
to the provision of public utility service and in an amount that
is not excessive. The usual method of evaluating capital related
costs is whether the investment is used and useful in an amount
that is prudently incurred.
4:13:28 PM
On page 2, line 31 through page 3, lines 1 and 2, he asked if
"including costs for the repair, replacement and retirement of a
project owned and operated by the corporation" meant they can
recover future capital replacement cost of an asset they don't
own. And if so, based on what theory?
He asked if the language on page 3, lines 3 and 4" "including
costs to permit the corporation to build reasonably necessary
equity for future operations" is an attempt to allow the
corporation to derive a desired profit number and kind of set
the rates to achieve that target. He explained that usually the
attraction and accumulation of equity is not a cost; it's a
capital transaction or the product of profitable operations.
He also questioned using the conjunctive "and" in language
saying "including costs by the corporation and incurred to
permit". Do both conditions have to be met or is it just a list
of non-exclusive costs that can be passed through to the
ratepayers?
MR. PICKETT said a number of policy and technical questions had
arisen. An underlying policy assumption that auditing equals
regulation, but the Commission has not taken a position on that,
and he said, "I think nothing could be further from the truth."
Also, he said language on page 13, lines 28-31, references the
corporation issuing equity and debt. How is it proposed that
GRETC will issue equity? He was under the impression GRETC was a
not-for-profit, and was this a contribution on the part of the
members?
MR. PICKETT said he had other questions. Bradley Lake has often
been sighted as an example of a project that clearly
demonstrates there is no need for regulatory oversight of GRETC.
It is fair to raise the example of Healy clean coal and if
deregulation is a de facto main goal of GRETC, that decision
should be transparent and out in the open with the ratepayers
well aware of what is going on. Currently in AS 42.05.711(h) and
AS 42.05.712 there are clear provisions for deregulation -
elections. He said the Commission would be taking this up at 9am
on Wednesday.
4:16:50 PM
SENATOR FRENCH said if the Bradley Lake model is so successful,
why is that not a good example to look at in considering this
bill.
MR. PICKETT replied that it is a successful example of the
public private partnership, but it is important to keep in mind
that it produces a very small percent of the overall electrical
generation capacity of the Railbelt. Comments last week about
one of the major changes in this version of GRETC versus what
was originally presented to the legislature is a bit of a
softening of its monopolistic posture that perhaps it had in the
earlier version. The individual utilities could choose to opt
out for instance.
MR. PICKETT stated that it is also fair to say that this bill
has positioned GRETC as being the primary recipient of state
funds, and there are good public policy reasons for that. Mr.
Johnson raised the concern of the capital markets, and at its
inception GRETC will have minimal assets. The key and critical
element is going to be how it will generate equity. Will the
legislature have to fund it or will there be riders to build up
equity from the respective member cooperatives and participating
utilities to prefund capital projects? Those are good questions
and in the end that will be what will shape GRETC's ability to
attract capital.
CO-CHAIR WIELECHOWSKI asked his views on sunsetting the RCA
review after five years.
MR. PICKETT answered that he is a skeptic and believes in checks
and balances for federal and state government. He didn't think
that auditing was an adequate proxy for regulation. There are
models that address rather unique situations which GRETC will
present such as the area of capital project surcharges and the
use of operating ratios rather than rate of return for utilities
that are essentially startups or that have contributed plant or
are fully depreciated, simplified rate making rules, and
adjustment clauses for fuel and purchase power costs.
CO-CHAIR WIELECHOWSKI said he had given them a lot to think
about and it is obvious that the bill has some questions that
still need to be answered and it would not move today.
SENATOR STEDMAN commented that this bill came into the body late
in the session it and should be set aside and worked on over the
interim.
CO-CHAIR WIELECHOWSKI agreed.
SB 255-FISH PROCESSOR FEES, LICENSES, RECORDS
4:21:41 PM
CO-CHAIR WIELECHOWSKI announced SB 255 to be up for
consideration.
4:22:29 PM
TIM BENINTENDI, staff to Senator Olson, sponsor of SB 255,
explained that a program is already in place whereby the
National Marine Fishery Service provides loans to groups formed
for the purpose of reducing fleet capacity by engaging in permit
buy-backs. The Southeast Revitalization Association (SRA) is
engaged in such an arrangement and operates with a self-imposed
3 percent fee on fish sales from those remaining permit holders.
He said this fee is the basis for repaying federal loans and any
new fish buyer must agree to collect and remit the fee upon
entering the fishery. SB 255 authorizes the Alaska Department of
Fish and Game (ADF&G) and the Commercial Fishery Entry
Commission (CFEC) to provide individual fish ticket data to the
National Marine Fishery Service (NMFS) that will support
monitoring the loan program by allowing them to confirm that the
assessments are correct and have been paid. SB 255 is supported
by the CFEC, several fisheries groups and it also has a zero
fiscal note.
SENATOR STEDMAN asked if anyone opposed the bill.
MR. BENINTENDI answered that he hadn't heard of any opposition.
The Pacific Seafood Processors Association (PSPA) had an issue
once, but an arrangement has been worked out in terms of the
draft letter of intent, which the sponsor supports.
4:24:14 PM
CO-CHAIR WIELECHOWSKI noted the letter of intent that had just
come to them.
MR. BENINTENDI explained that there was a difference of opinion
on a peripheral issue, and it came through by virtue of this
bill into a discussion. The letter of intent is a product of the
resolution.
CO-CHAIR WIELECHOWSKI said it is proposed by the seiners and
processors, but nothing had been formalized.
SENATOR HUGGINS asked if the administration supports this bill.
MR. BENINTENDI answered yes.
4:25:52 PM
ROB ZUANICH, Manager, Southeast Revitalization Association
(SRA), said he represents the 180 Southeast purse seine limited
entry permit holders for the salmon fishery. He provided
testimony entitled "The Long Road to Implementing a
Consolidation Program for the Southeast Purse Seine Salmon
Fishery." He said the genesis of this concept came up in the
Salmon Legislative Task Force at the same time the salmon
production credit came up.
In 2002 the legislature allowed associations to be formed to
consolidate permits, and in 2004 the SRA was created for that
purpose. In 2005, they went to Congress to specifically amend
the Magnuson Stevens Act to give them access to a federal loan
program to finance this consolidation plan. In 2006 Congress
appropriated money to guarantee the loan; in 2008 this
legislature appropriated $3 million in grants to allow the first
phase of this program to go forward. In 2009, they had this bill
that the NMFS says is required before they can finance the loan
before them.
MR. ZUANICH said the loan program provides that permit holders
can voluntarily decide to sell their permit and submit a bid for
a dollar amount that they wish to sell it for. If they submit a
bid, they sign a contract agreeing to relinquish their permit if
it is accepted. The bids will be submitted to a certified public
accountant that will rank them and report the results. The SRA
will then look at those bids and if they are satisfied, that is
the basis to go forward with the consolidation plan. They submit
it to the NMFS. The NMFS would then conduct a referendum of the
permit holders to see whether they are willing to go along with
the plan. If a majority approves it, the plan will be
implemented. The plan will also require that only a minimum of
260 permits will remain in the fishery after this program is
implemented.
SENATOR STEDMAN asked of the potential permits that will be
retired how many are held by Alaskans.
MR. ZUANICH answered that a majority of the permits to be
retired will be owned by non-residents. In phase 1 of the
program 31 of the 35 permits retired were of non-residents. So,
they believe it will stabilize and "Alaskan-ize" the purse seine
fishery.
4:29:55 PM
SENATOR STEDMAN asked why 260 was the number of permits selected
as the number to remain.
MR. ZUANICH replied, "I guess it was your back room brokered
agreement between the Southeast Seiners Association and the
affected seafood processors." Their concern was that the program
could go too far and there would be too few fishermen to harvest
the available salmon to supply their plants. They are trying to
show that past large catches have been when 209 and 213 permits
were fished; so they are satisfied that the 260 threshold is
more than adequate.
SENATOR WAGONER said the biologists have the ability to adjust
the catch with openings and number of days fished.
4:30:55 PM
BOB THORSTENSON, Executive Director, Southeast Alaska Seiners
Association (SASA), supported SB 255. He said the number of 260
permits was carefully chosen by his members. It will be good for
long term stability of the industry for both investments in the
processing sector and the fishery. It will be good for young
fishermen, because it allows more permits than are currently
fished. Also buying into the fishery now would cost $500,000 to
$1 million knowing that twice as many boats won't be coming up
in the future is reassuring for that kind of investment.
He said they really appreciate the support the legislature has
given them. This bill is really a simple accounting procedure,
but it is a very important nexus to the federal loan program.
This is the first state waters fishery that has been able to
access a federal loan program. His members have polled 77-86
percent in favor of this program over the last 20 years; and the
processing sector is either for it or neutral.
SENATOR HUGGINS asked the geographical boundaries of the bill.
MR. THORSTENSON replied that the bill applies to any limited
entry fishery in Alaska. He is attempting to apply it to SO1A,
the Southeast Alaska Purse Seine.
SENATOR HUGGINS asked what the numbers of the fisheries were in
the state a decade ago.
MR. THORSTENSON replied that his constituents fish in Southeast
Alaska and that is the reason there is an emphasis on Southeast.
They are the only ones who have used the 2002 legislation (HB
286) to organize and proceed with the federally funded buy back.
About 22 percent of the permits have already been retired
through grant money. This is the final closing document for
paying the loan.
SENATOR STEDMAN wanted the geographic breakdown of the 212
permits that were fished in 2008 along with the 168 that weren't
fished.
MR. THORSTENSON responded that he could get that information for
them.
4:36:38 PM
FRANK HOHMAN, Commissioner, Commercial Fisheries Entry
Commission (CFEC), said their packets had a one-page statistical
breakdown of the fleets for the last 12 years. It had a
breakdown of resident and non-resident figures. In 2008 of the
212 that fished 113 were resident and 90 were non-resident. Of
the 168 that did not fish, 55 percent were non-residents and 44
percent were residents. Looking back over the statistics, a
majority of not fished permits have been owned by non-residents.
CO-CHAIR WIELECHOWSKI asked if the administration supports this.
MR. HOHMAN said that every administration since 2002 has worked
to resolve this issue.
SENATOR HUGGINS asked what affect reducing the number of permits
to 260 would have on the value of the permits.
MR. HOHMAN replied that the tendency would be for them to become
more valuable, but the main emphasis behind the program was to
enhance economic return to the participants.
4:43:18 PM
SENATOR STEDMAN said he had heard that the state might help some
of the smaller villages in buying entry permits to help them
regain the fishing fleets that they used to have. He asked if
the state would be able to issue additional permits in the
future or would it have to buy some of the 260 permits and
spread those around.
MR. HOHMAN answered that the way the Limited Entry Law is
structured, only an individual could hold an entry permit;
villages can't. But the state has two loan programs - the
Division of Investments and the Commercial Fishing and
Agriculture Bank - that have the ability to loan for permits in
any field. In this program specifically, the permits would be
retired permanently. The state couldn't reissue them. The state
would always maintain its responsibility for managing the
fishery and if the situation - either through conservation or
management or economics - changed in the future, the state would
always have the ability to put more permits back into any
fishery, but that would be done through a complicated process
involving an optimum number study.
4:46:24 PM
JOE PLESHA, General Counsel, Trident Seafoods, supported SB 255
with the understanding that the SESA has agreed that 260 permits
will be available at the end of this process. He said Trident
has seafood processing facilities in Ketchikan, Petersburg and
Wrangell; they have spent millions of dollars in the last few
years increasing capacity as well as value-added product forms
that are produced from pink salmon. As a result of those efforts
and efforts and those of other processors, the market for pink
salmon is very healthy and permit values are as high now as they
were in the mid-1990s.
He said Trident was concerned that they didn't know the scope of
this program and if too many permits were bought back it
wouldn't allow for processors to achieve their daily production
capacities through their plants. They believe 260 permits will
allow for them to attain financial stability as well as for the
Seiners Association.
4:47:47 PM
MARK PALMER, President, Ocean Beauty Seafoods, supported SB 255.
He said it is important to consider investments that have been
made in the production facilities in the shore-based communities
they exist in. The number of 260 permits ensures their long term
viability as well as their ability to grow and meet the needs of
the markets they are in today.
4:48:33 PM
CO-CHAIR WIELECHOWSKI closed public testimony and set SB 255
aside.
HB 162-SOUTHEAST STATE FOREST
4:49:34 PM
CO-CHAIR WIELECHOWSKI announced HB 162 to be up for
consideration.
4:49:38 PM
CHRIS MAISCH, Director, Division of Forestry, Department of
Natural Resources (DNR), said that HB 162 would establish a new
Southern Southeast State Forest and it would be managed as part
of the State Forest system under AS 41.17.200-230. Lands in the
State Forest would continue to be open for multiple uses
including wildlife habitat and harvest and recreational
activities. The State Forest designation would not affect the
Wrangell Borough municipal entitlement nor would it affect
calculation of entitlement acreage for future municipalities in
Southeast Alaska.
He explained that Section 1 (a) and (d) provide legal
descriptions for the lands to be designated as a Southeast State
Forest in AS 29.65.030. Designated lands include 20 parcels
totaling approximately 25,291 acres on Prince of Wales, Tuxekan,
Kosciusko, Hecate, Revilla and Gravina islands, and on the
mainland at Crittenden Creek. These parcels are an important
part of the state timber base but are classified as general use
lands, which may be sold in the future. Legislatively
designating a state forest would ensure that some land will
remain available for long term forest management and enable
thinning to increase timber volumes. Designated lands exclude
areas identified as important sites for future state land
disposals.
MR. MAISCH said the management plan and transportation corridors
were in subsection (b). It directs DNR to prepare a management
plan for the Southeast State Forest. Under AS 41.17.230 a
management plan is required within three years after a state
forest is established; and state forest management plans must
consider and permit multiple uses including recreation, tourism,
mining, use of fish and wildlife, and other traditional uses
unless the commissioner issues a site specific written finding
that a use is incompatible with one or more of the other uses.
Public interagency and board of Forestry review is required
prior to adoption of the state forest management plan. As in
other state forests, subsection (c) states the DNR commissioner
may also establish transportation corridors within the state
forest.
The next category (section 1) is municipal entitlements, and
subsection (e) clarifies the relationship of the Southeast State
Forest to current and potential municipal entitlements. State
Forest can affect the amount of land a municipality is entitled
to select and the land available for selection. The amount of
land a municipality may select is based on the maximum total
acreage of vacant unappropriated and unreserved land in the
borough boundaries within two years after the date of
incorporation (AS 29.65.030). Municipal selections are limited
to VUU land; land classified as general use land is VUU land,
but state forests are not.
He said that Southern Southeast State Forest is designated to
have no impact on Wrangell Borough land selections. The amount
of land that the Wrangell Borough may select is already fixed by
its date of incorporation and this bill specifies that it may
select state forest land within the borough boundary. Three
parcels in the Southeast State Forest are within the Wrangell
Borough Boundary. If new municipalities are incorporated before
June 30, 2019, the Southeast State Forest will not affect the
amount of land that they can select.
MR. MAISCH said HB 162 specifies that state forest lands that
were VUU lands before establishment of the State Forest will be
included in the calculation of the entitlement acreage. However,
parcels in the southern Southeast State Forest may not be
selected. If municipalities form after 2019, the amount and
location of their entitlement would be based on the VUU land at
that time.
MR. MAISCH said section 2, authorizes DNR to immediately adopt
regulations to implement the bill. Section 3 is the effective
date for regulations; section 2 takes effect immediately and
finally section 4 provides for an effective date of July 1 for
the State Forest; it currently reads 2008 and that will be
amended.
4:54:47 PM
He noted letters of support from the Resource Development
Council, the Southeast Conference, the Society of American
Foresters - both Juneau and Statewide Chapters, the City of
Wrangell, the Community of Coffman Cove, and the Alaska Forest
Association. The Board of Forestry supports this; the membership
of the board includes Alaska Native corporations, the Forest
Industry Trade Association, a non-government professional
forester, a non-governmental professional fish and wildlife
biologist, a mining organization, a commercial fish
organization, a recreation organization, and an environmental
organization. All those entities reached consensus on this and
unanimously supported this legislation. He said this is a
governor-sponsored bill and the administration supports it
wholeheartedly. He said this bill helps show the State of Alaska
will make investments in long term forest management in southern
Southeast and help these communities maintain diversification.
4:56:34 PM
SENATOR WAGONER asked if it is safe to assume all the units
either have water frontage for the timber to be taken off or
other access.
MR. MAISCH answered yes; all the parcels have either log
transfer facility access or the logs are already accessed by a
transportation system. On Prince of Wales that would be
primarily a road system.
SENATOR FRENCH asked what other steps would be necessary besides
passing this bill to get thinning started on these lands -
either through the state or other agencies.
MR. MAISCH replied that pre-commercial thinning can be done on
these lands now, but they have not been willing to make that
investment because these lands could be sold, selected by a
future municipal process or essentially be lost to state
ownership - and it's an expensive proposition to do pre-
commercial thinning. He said they did secure some American
Recovery and Reinvestment Act (ARRA) funding for thinning, which
they will use.
SENATOR FRENCH asked what the state expenses are and why aren't
they borne by the people who are selling the logs.
4:58:27 PM
MR. MAISCH answered that the state currently has a pre-
commercial thinning program in the Haines State Forest (in
Southeast). They have not been willing to spend their funding on
land that is not allocated for long term management. The ARRA
funds supplement the money they already have.
SENATOR STEDMAN asked how much timber volume is on these lands
in percentage of old growth versus what had been harvested since
industrialized logging in the 1950s.
MR. MAISCH replied about 1,100 acres of state forest land has
previously been harvested. The 29,000 acres is not all
productive forest land. The allowable cut for these parcels of
land is 8.7 million feet annually. To put that in perspective,
he said the current Tongass Land Use Management Plan (TLUMP)
calls for up to 100 million feet of volume to be harvested
annually.
SENATOR STEDMAN said he thought they used to do around 369
million board feet.
MR. MAISCH explained there are three phases of the TLUMP, and
the third phase calls for up to 280 million feet.
SENATOR STEDMAN said the forest is proposed to be 25,300 acres
and asked how much acreage is commercial timber, second growth
and scrub land that has no significant timber volume.
MR. MAISCH said he didn't know the actual acreage of the old
growth volume that is present on that 25,000 acres, but that
translates to an 8.5 million annual figure. He offered to get
accurate information for the committee.
5:00:53 PM
SENATOR STEDMAN said some would be more interested in old growth
selection rather than swamps.
MR. MAISCH replied that this land was through an area planning
process and so these lands were selected for their forestry
potential. They worked closely with the Division of Mining, Land
and Water to look at the total 49,000-acre package they have
that is identified as GU with forest management intent, and from
a forestry perspective, these lands are the most productive in
that 49,000 acres.
SENATOR FRENCH asked for an estimate of how many jobs would be
created with the opening of these lands.
MR. MAISCH said he could estimate, but the industry is growing
with the enhanced value added concept. He said the state timber
program has become more and more important to the remaining
mills that are left in Southeast. One large mill is left on
Prince of Wales Island and a bridge timber program has supplied
some of the critical volume to that mill to keep it open. Volume
is also provided to many small one and two person operations
that are scattered through Southeast Alaska, including Icy
Straits Lumber Corporation in Hoonah. It's hard to estimate the
number of jobs, but it is very important volume because of what
has happened to the federal timber sale program in Southeast.
SENATOR HUGGINS asked how often a new state forest is
established.
MR. MAISCH answered it's not very frequent. There are only two
other Alaska state forests in existence - the Tanana Valley
State Forest, which is the largest at 1.8 million acres and the
Haines State Forest. This would be the third forest in that
system and would be the first one since the Tanana Valley State
Forest was authorized in the 1980s.
SENATOR HUGGINS asked how long he had been working on this
project.
MR. MAISCH answered for the better part of four years. He said
the federal program in Southeast is in dire straits, and they
have been working with the federal government to try and turn
that program around. "This is a very important comment to make,
in my opinion, to the communities and to the Forest Service that
the state supports long term management and this is the way to
do that by designating the state forest."
SENATOR HUGGINS said he supports what they are trying to do.
CO-CHAIR WIELECHOWSKI asked what kind of public process they
went through and if they found any opposition to the bill.
MR. MAISCH answered that they had an extensive process; they met
internally and other agencies that would have potential interest
in them establishing a state forest. After that they did further
outreach to communities in the areas the state forest would be
around, they talked before the Tongass Futures Round Table
Organization, he presented twice to the Southeast Conference,
talked to local community councils, legislative bodies, and
environmental groups. By and large they have found strong
support for this bill.
Last year, Mr. Maisch said, concerns were expressed about two of
the parcels - one was Crittenden Creek and the other was on
Gravina Island - by some individuals who worried about their
location and the fact that they would be used for forest
management purposes. He provided a lengthy response that is in
the record. Briefly, it says the lands had been through an
extensive area planning process which included public meetings
in all these communities, a lot of public outreach, and these
lands were chosen to be set aside for GU purposes, but with a
forestry management intent. It continued that the City of
Wrangell may indeed select the Crittenden Creek parcel and that
would put that parcel in local control which means the local
community could decide what the best use of that particular
parcel might be.
5:07:26 PM
DICK COOSE, representing himself, Ketchikan, supported HB 162.
He said he is a retired forester and knows it will allow more
efficient multi use management of those state lands. The use of
the forest products that comes from these lands helps the local
economy and adds jobs. Alaska is now a leader in quality
effective and efficient management of forest lands; the more
lands that can be designated as state forest lands the better
off we are. The feds aren't managing their lands effectively.
5:08:57 PM
JACK SLAGHT, representing himself, Petersburg, Alaska, said he
supported HB 162 and believes that Southeast Alaska needs to
strive to rebuild a diversified economy. In the past 20 years a
relentless assault has remained on the forest products industry
by environmental groups that has reduced that industry to almost
nothing. Currently only fishing, processing and some tourism
exit in the Petersburg area. Thankfully some mining is still
being done. There will be increased competition for ocean
resources, and no one knows how future energy costs will affect
fishing and processing.
5:12:33 PM
OWEN GRAHAM, Alaska Forest Association, supported HB 162. He
said the division wants to make sure the money they invest in
these lands won't be lost and the trees will be allowed to grow
to maturity after thinning so that investment can be recouped
through timber sales in the future. He said this industry has
shrunk by 85 percent since 1990 and it is solely the result of
an inadequate supply of timber. The federal timber supply has
just disappeared, and the federal government controls more than
90 percent of the timber lands in Southeast Alaska. In contrast
the Division of Forestry has done a good job with its timber
sale program.
5:14:22 PM
MARK VINSEL, Executive Director, United Fishermen of Alaska
(UFA), said he is speaking as the seat designated for commercial
fishing on the Board of Forestry. He pointed out that the board
works on a consensus basis and there was no opposition to this
bill. He had not heard of any opposition from UFA members or
individual fishermen on this bill.
5:15:13 PM
RON WOLFE, Alaska Native Corporation representative to the Board
of Forestry, said he is also the Sea Alaska Corporation Natural
Resource Manager. He added his support to this legislation.
5:15:53 PM
WAYNE NICOLS, member, State Board of Forestry and the Society of
American Foresters, supported HB 162. He said he is also a
Certified Forester and is retired after working 37 years for the
Forest Service. There are several reasons for establishing a
state forest in this area and they have heard most of them. A
primary reason is to enable long term investment in forest land.
Effective forest management involves investments in terms of
creating access for harvest and for subsequent management
activities. Investments in good forest management are only
feasible and prudent with long term ownership provided by
dedication of forest land as in a designated state forest.
He said that timber management on the Tongass National Forest
has become very limited due to litigation and other factors.
While the state forest cannot begin to compensate entirely, it
can help offset it. As such, mature timber existing now can be
properly harvested soon contributing a wood supply for the
industry and creating jobs. As the harvested portions of the new
forest degenerate the young growth will be managed for optimum
or maximum quality and quantity to establish cultural treatment
of new stands and increase their value as the years pass.
MR. NICOLS said all state forests are managed by the Division of
Forestry successfully under the very effective State Forest
Resources and Practices Act. It provides an umbrella-like set of
regulations and best management practices to protect and enhance
other resources, most notably streams and water sheds. He said
this act is exemplary among at least 35 states that have similar
laws, and that most forest management enhances fish and wildlife
habitat.
He said that the Society of American Foresters is a unit of the
largest such organization in the world and is the only
professional forestry organization in the United State. By a
resolution first initiated by the Juneau Chapter, and
subsequently by unanimous conference the statewide organization
endorses establishes of the Southeast Forest. He hoped they
recognized the importance and wisdom to environmental and
economic benefit of all Alaskans of establishing a new state
forest in Southeast Alaska.
5:20:06 PM
MR. WOLFE responded to a question from Senator French about why
the purchaser didn't bear the cost by saying that would be
difficult simply because of the time period involved. Typically,
pre-commercial thinning is done 15-20 years following timber
harvest. So image factoring that funding into your bid. It is
not uncommon for the purchaser to be responsible for
reforestation, however in the kind of forest Southeast Alaska
has that is rarely a problem.
5:21:00 PM
MR. NICHOLS commented in regard to Senator Huggins' question
about how often state forests happen that he hoped they would
hear lots more about them in the future.
5:21:28 PM
JOHN SANDOR, representing himself, Juneau, supported HB 162. He
said he is a former regional forester and commissioner of the
Department of Environmental Conservation (DEC). He said the
state forest would be professionally managed in accordance with
the Alaska Forest Practices Act, and the DNR and the Forester
has an excellent record of managing Alaska's diverse ecosystems.
Since the closure of Southeast Alaska pulp mills in Ketchikan
and Sitka and with the ongoing political and legal challenges to
virtually every U.S. Forest Service road and timber sale in
Southeast Alaska, the integrated forest products industry of
Southeast Alaska that had generated more than 3500 jobs has been
eliminated - to the detriment of every Southeast community. To
this day any road timber sale cannot be proved locally, but has
to be submitted to the Secretary of Agriculture's office for
approval.
The establishment of the Alaska Southeast State Forest
authorized by HB 162 will help begin the process of restoring
professional forest management practices with multiple benefits
from timber recreation, wildlife, fisheries, and other uses,
resulting in economic and environmental and quality of life
benefits to Wrangell and other Southeast communities.
SENATOR WAGONER commented that the state of Utah has taken a
solid stance against the federal government. He asked what he
thought about having the state take over the federal lands in
the State of Alaska.
MR. SANDOR said he is very much in favor of that move. Over 90
percent of Southeast Alaska is managed by the federal government
and even though the Tongass plan authorizes up to 100 million
feet to be harvested, less than 25 million is harvested. It is a
fact that the 1890 and 1900 census of the State of Alaska
recorded more saw mills operating than today in Southeast
Alaska.
5:25:42 PM
CO-CHAIR WIELECHOWSKI thanked everyone for their comments and
held HB 162 for further work. He adjourned the meeting at 5:25
p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 245 - Bill Packet.pdf |
SRES 3/29/2010 3:30:00 PM |
SB 245 |
| SB 255 - Bill Packet.pdf |
SRES 3/29/2010 3:30:00 PM |
SB 255 |
| HB 162 - Bill Packet.pdf |
SRES 3/29/2010 3:30:00 PM |
HB 162 |
| GRETC - Joint Utility Task Force.pdf |
SRES 3/29/2010 3:30:00 PM |