HB 119-PUBLIC UTILITY JOINT ACTION AGENCIES Number 1663 CHAIR MURKOWSKI said the committee would take up HOUSE BILL NO. 119, "An Act exempting joint action agencies from regulation by the state or municipalities; relating to the relationship between a joint action agency and the public utilities that form the joint action agency; relating to powers and immunities of a joint action agency; requiring filing of the joint action agency agreement; relating to the financial affairs of a joint action agency; declaring certain joint action agencies to be political subdivisions for certain purposes; relating to liability and indemnification of officers, employees, and agents of joint action agencies; and defining 'agency agreement' as used with reference to joint action agencies." REPRESENTATIVE PEGGY WILSON, Alaska State Legislature, sponsor of HB 119, said last year the legislature passed legislation that authorized the sale of the Four Dam Pool projects to the local utility communities. She said "they" have been working since that time to get it going. During the process it became apparent that there needed to be "some legal cleanup." She directed the committee to Mike Schrader, Legal Counsel to the Four Dam Pool, for any questions; any questions on the history of the project were directed to Dave Carlson, Divestiture/Project Coordinator. Number 1735 MICHAEL SCHRADER, Legal Counsel to the Four Dam Pool, AterWynne LLP, stated that "we" represent the project management committee and the newly formed Four Dam Pool power agency, a joint action agency ("JAA") that was formed pursuant to the legislature. He said HB 119 is a technical bill, and the JAA is the vehicle that will be the owner of the Four Dam Pool projects when the projects are purchased from the state at the end of the year. MR. SCHRADER relayed that during the formation of the JAA, a number of issues were worked through with the member utilities; a number of those dealt with the terms of the actual agreement that formed the agency. That agreement has been executed and approved by all of the member utilities. However, a handful of issues were raised in the process. They were technical in nature and essential to the JAA and the whole divestiture process in order to realize the business objectives. Number 1794 MR. SCHRADER explained that there were three issues raised, which are addressed in HB 119. HB 119 has some language that clarifies that the member utilities are limited in their liability. He explained that the JAA is a limited liability entity. The member utilities [want to ensure] that a claim against the JAA, as the owner of the Four Dam Pool projects, could not also be made against the member utility, just as a shareholder in a corporation is insulated from the liability of the corporation. MR. SCHRADER said the second issue is more technical. The JAA is currently granted the powers of a public utility, which includes the power of eminent domain - the power of condemnation. In order to carry out its business goals, the JAA needs flexibility to operate without being subject to federal taxation. It also would need flexibility down the road if one of the projects were to be sold to a community that purchases powers from one of the projects, which is contemplated in the divestiture and enabling legislation. He said it is key that all of that be done on a federally tax-exempt basis. Number 1890 MR. SCHRADER mentioned that a private letter-ruling request is being put together for the Internal Revenue Service (IRS) to confirm the tax-exempt status of the JAA. He said part of this exercise is to demonstrate that the JAA is a governmental unit; a key factor is the scope of the entity's eminent domain or condemnation powers. The bill, therefore, clarifies that the JAA has the eminent domain or condemnation powers that its member utilities have. He reiterated that the clarification is to get a ruling request from the IRS stating that the entity is tax exempt or a governmental unit. Number 1918 MR. SCHRADER explained that the third piece of the legislation confirms the exemption from regulation by the Regulatory Commission of Alaska (RCA). Four of the five member utilities are currently exempt. The power-sales "master" agreement defines the relationship of the communities to the project, and the price at which power is purchased - which under statute is specifically exempted from RCA regulation. MR. SCHRADER emphasized that this confirms that the JAA is exempt from RCA regulation. Number 1944 REPRESENTATIVE HALCRO asked Mr. Schrader what type of potential liability claims he sees arising against the JAA. MR. SCHRADER said, "Any kind of claims that might arise in just the course of operations or ownership of a power project. It could be a catastrophe [and] could be a contract claim, or something like that." The key is to add language to the existing JAA statute to make sure that the JAA, as the owner, is a limited liability entity, similar to a port authority or other entities created by Alaska law. Number 1984 REPRESENTATIVE MEYER asked Mr. Schrader if the RCA has taken a position. MR. SCHRADER said the RCA has not taken a position yet, but his firm has been in contact with RCA staff and provided them with a draft of the bill, along with a summary of what it proposes to do. REPRESENTATIVE MEYER asked whether the labor unions are supportive of this [legislation]. MR. SCHRADER said, "That is my understanding; I'd have to defer to Mr. Bob Evans for more information on that." REPRESENTATIVE MEYER said normally the committee would hear from these groups if they were not in support of the legislation. Number 2023 REPRESENTATIVE ROKEBERG said the IRS has a number of tests that are laid out by regulation in the tax court of rulings. He asked what other factors there are, besides the power of eminent domain. And, what elements does the JAA have to meet for the "safe harbor test?" Number 2049 MR. SCHRADER explained that "safe harbors" are articulated in a number of private-letter rulings and in other authority. He said the baseline test is articulated in the authority: "Does the entity exercise sovereign powers?" In the ruling request and the authority that is out there, the principal sovereign power that was looked at was the eminent domain or condemnation power. MR. SCHRADER said there are also rule making authority and police powers. He said he thought eminent domain, the ability to promulgate rules, and the police powers were the three main ones. In this case, the only one that applies to the JAA is the condemnation power. Number 2077 MR. SCHRADER stated that the JAA currently has condemnation powers because it has powers by statute of a public utility, which identifies the procedure it is subject to. He said right now it is ambiguous as to whether the JAA is subject to the procedures of its municipal member utilities, the declaration of taking procedure, or the other procedures of an investor-owned utility. This says it has the powers and procedural rights of its member municipal utilities. Number 2109 REPRESENTATIVE ROKEBERG said, "Clearly, the municipal members would have their own powers of eminent domain, but refresh my memory, do RAs [regional authorities] or co-ops have that same power?" MR. SCHRADER explained that cooperatives do not have the declaration of taking power; they have an eminent domain power, but it is different. The declaration of taking is streamlined and the process is short-circuited; cooperative utilities have a different procedural requirement that has to be gone through to exercise powers of eminent domain. Number 2151 REPRESENTATIVE ROKEBERG clarified with Mr. Schrader that the way the statute was drafted was the way it was intended to be - for the actual agency to have the power of eminent domain. MR. SCHRADER said it was ambiguous, and it was determined that the JAA was the appropriate vehicle. As "we" began to focus on the actual terms of the agreement and the ability to operate on a tax-exempt basis, the ability to not dictate the terms of a subsequent breakup of the [Four Dam] Pool, 15 or 20 years down the road, became critical. He said when the tax analysis was done, it was determined that with some changes in federal law in recent years, some private-benefit rules could dictate what one does on an operating basis now, which would dictate some of the terms of a breakup down the road. MR. SCHRADER said the reason for asking for the clarification on the condemnation powers is due to the issue of getting the tax- exempt status, which goes back to the sovereign powers issue. Number 2208 REPRESENTATIVE ROKEBERG asked if the agency needs those powers for its own operations; if those powers are invested in the ownership, from an operational standpoint; or if those powers are rendered only for the tax requirement. MR. SCHRADER said that is the only reason it is in the bill right now, because each of the member utilities has condemnation power. REPRESENTATIVE ROKEBERG asked if Mr. Schrader conceives of the agency going out for financing for the entire entity, and asked if that is the concept here, that the gross assets of the whole pool would be the credit behind the bonding. MR. SCHRADER said, "At some point, if there were debt incurred, yes, it's contemplated (indisc.)." REPRESENTATIVE ROKEBERG said there would be an agency's debt backed by the assets of all of the membership. Number 2244 MR. SCHRADER concurred and reiterated that the JAA is the vehicle, the separate legal entity that would own the project and would assume the state's obligations and liabilities. He said it would essentially be an Industrial Development Bond (IDB). REPRESENTATIVE ROKEBERG asked how that would affect the state's allocation for IDBs. MR. SCHRADER said it wouldn't be subject if it was done on a tax-exempt basis, and it would have to be volume-capped. REPRESENTATIVE ROKEBERG asked if the state is limited in the amount of IDBs that can issue annually. MR. SCHRADER said "certainly" but the only debt that is contemplated currently for the JAA is the indebtedness to the state to purchase the projects as part of the divestiture transaction. He said bonding authority is down the road, and there are a host of tax issues, such as: whether "you" can finance on the bonds themselves; whether the entity itself is a tax-exempt entity; and whether its obligations have interest that is tax-exempt. MR. SCHRADER said that "we're" seeking clarification of condemnation powers to clarify that the entity is tax-exempt on an operating basis, at this point. He said down the road, if it issues bonds for repair or maintenance, and if it were possible to issue those bonds on a tax-exempt basis, those issues would be addressed at that point. REPRESENTATIVE ROKEBERG asked, "Couldn't you go through the Alaska Municipal Bond Bank to qualify?" MR. SCHRADER said, "If that were an appropriate mechanism of financing, yes." He said what "we" are concerned with, currently, is not debt issuance on a tax-exempt basis. Rather, it is the ability to operate on a tax-exempt basis and not be subject to taxation on income, allocations to member utilities, and the ability to not have the purchase price dictated by the federal tax (indisc.). MR. SCHRADER said current operations and the future breakup of the pool are what are driving this provision, with respect to the eminent domain powers. Number 2345 REPRESENTATIVE ROKEBERG asked about the exemption from the RCA. He said it is a very sensitive issue, and there is a "right of utilities" in Alaska to opt out of economic regulation. He asked if the original bill was organized to do that, since it had been mentioned that it has exemptions. Number 2361 MR. SCHRADER said he is not sure that it completely filled the gap because it clearly contemplated the JAA in the power sales agreement. There is specific language added in Title 42 last year to the existing exemption for the power-sales agreement, the master agreement that defines the power cost and other things; it extends the exemption of the power-sales agreement to the JAA. He said he thinks it is clearly contemplated that it would not be subject to economic regulation by the RCA. He said it was clear that the power-sales agreement would continue to be an exempt agreement. Number 2402 REPRESENTATIVE ROKEBERG said he knew that Copper Valley Electric Association opted out for fear of deregulation. He asked if municipal utilities are handled differently. MR. SCHRADER replied that they are exempt under [page 2, Section 2], AS 42.05.711(b), and later in that section are the provisions which allow the cooperatives to go through the procedure to opt out from regulation. He said in his understanding, Copper Valley [Electric Association] did that. Number 2426 REPRESENTATIVE ROKEBERG said this provision allows the agency to opt out but allows the cooperative to remain in - but be separate. Number 2438 MR. SCHRADER reiterated that the bill would not change who is and isn't regulated. He said four of the five [member utilities] aren't regulated. Kodiak is the one that is regulated and will continue to be. If that changes in the future, it will be because [a member utility] decided to opt out or there was some change in the law. Number 2447 REPRESENTATIVE ROKEBERG asked who would pay for a claim against the JAA, and if it is just the assets that are under control. Number 2466 MR. SCHRADER said the JAA would be the owner of the project, and it would be entitled to the revenues for power purchases. He said its liabilities will pay for its assets. He reiterated that it is characterized like a port authority, and is a limited-liability entity. He pointed out that the current legislation says that the JAA has a separate and distinct legal existence, which means that it is a separate legal entity for liability purposes, so claims can't be made to the member utilities for claims against the JAA. TAPE 01-15, SIDE B Number 2491 REPRESENTATIVE HALCRO referred to the legislation passed last year, HB 446 and HB 447, and reconfirmed that the original intent was that the JAA would not be under RCA regulation and would be exempt from regulation. He verified that the intent of this new legislation is to clean up some of the language. MR. SCHRADER said there is specific language in HB 446 and HB 447 that deals with the continued exemption of the power-sales agreement once it is assigned from the state to the JAA. Number 2451 CHAIR MURKOWSKI referred to the information provided [from AterWynne] to the committee and said it talks about taxes that the state may impose on it, saying "that the joint action agency is subject to state and local taxes to the extent any of the public utilities forming the agency is subject to that particular tax." She expressed her understanding that the intent goes beyond that: "Don't confuse, don't cloud it, because there are different entities that may be subject to different taxation, so let's just give us a complete exemption." She asked if her interpretation was correct. Number 2391 MR. SCHRADER said it was a fair characterization. He said it is not currently clear, since there are two types of entities - municipal member entities and cooperative member entities - which are subject to different kinds of taxation. He said the exempt status of the JAA under state law is another factor in that analysis for the federal tax-exempt status. He said the bill proposes to treat the JAA like a port authority, which is exempt. Number 2370 CHAIR MURKOWSKI said there is not a fiscal note with the legislation but wondered what was being lost; she asked if there are payments in lieu of taxes that the state would be losing out on if the legislature goes ahead and provides this exemption under the state tax exemption. MR. SCHRADER said he didn't know because it would depend on whether the tax treatment of the JAA was that of its member utilities or that of the cooperative utilities, or some combination. Number 2345 CHAIR MURKOWSKI said she has not spoken to anyone on the RCA but was handed a message from one of the commissioners that said the JAA is requesting that it be exempted from a certificate. She said she thought he was referring to the certificate of public convenience. She asked the sponsor why the JAA wanted an exemption from the certificate of public need. Number 2295 MR. SCHRADER said the current exemption that the JAA is exempt under is an exemption from economic regulation, not from the certificate of need requirement. He said "we" believe that a complete exemption is appropriate because this transaction - the sale of the projects to the Four Dam Pool power agency, the new JAA - has already been approved by the legislature. He said in addition to all of the other administrative procedures that have to be complied with, in terms of the "lands issue" and transfer, the process and procedure that is already dictated by state law is a significant hurdle in completing this transaction by the end of the year. He said there is also the Federal Energy Regulatory Commission's (FERC's) transfer of licenses, which imposes a similar process of suitability and soundness of the licensee for the Four Dam Pool power agency. MR. SCHRADER said it is appropriate to have the exemption from the certificate of need because of the administrative transaction costs, and because the Alaska State Legislature already approved the transaction. Number 2241 CHAIR MURKOWSKI asked if this legislation would allow for other public utilities to form other joint action agencies that would also be exempt from RCA authority. Number 2215 MR. SCHRADER said theoretically and potentially, "yes," but in reality, "no," because the language in AS 42.45.310, the new provisions added last year to allow the creation of the JAA, are specifically limited to the Four Dam Pool projects. He said there is some grandfathering language, which refers back to projects that were in existence. In his understanding, these are the only projects for which this type of JAA could be formed. He said it is legislation designed to facilitate this divestiture transaction, even though the language looks as if it is broad. Number 2191 CHAIR MURKOWSKI said her concern is that it is theoretically possible. She understood the intent to be limited to the Four Dam Pool divestiture, and "this" is to facilitate that. She wanted to make sure that it was narrow enough in scope so it wouldn't have an unintended consequence, but she also recognized that it couldn't be too narrow either. Number 2148 MR. SCHRADER stated that the language in AS 42.45.310 is carefully crafted to deal with this situation by referring specifically to projects from the energy program in Alaska, which ties in specifically to this project. Number 2129 REPRESENTATIVE ROKEBERG referred to AS 42.45.310(c)(2) [page 3, Section 7, of the bill], which says that the agency has the power to sue and can be sued. He asked how the request to limit liability is justified with regard to the existing law. MR. SCHRADER replied, "The power to sue and be sued, absolutely," but said if there is a judgment entered against the JAA, it means that the judgment can't be enforced against the member utility, just as a claim against a corporation can't be made against a shareholder unless the shareholder has done something to expose himself or herself to liability. He said liability is being limited. TOM FRIESEN, Ketchikan Representative, Four Dam Pool, Ketchikan Public Utilities (KPU), said with the 12 budgets that he has participated in with KPU there were no payments in lieu of taxes made on any of the utility values to the state. He said he didn't think that it would affect the state's collection in this venture. MR. FRIESEN said with regard to union support, during the enactment of HB 446 and HB 447 legislation, "we" had letters from Gary Brooks (ph), International Brotherhood of Electrical Workers (IBEW), and from Vera Plumb, Business Representative for Wrangell, Petersburg, and Ketchikan. He said "they" were 100 percent behind this divestiture program. CHAIR MURKOWSKI asked Mr. Schrader at what point the private federal ruling from the IRS has to be done. Number 2011 MR. SCHRADER said he has a draft and wants to submit it immediately because of the time involved in going through the process. He said it was drafted based on existing law, and the intent is to attach a copy of this bill, explaining that it is pending legislation. He explained that the intent was that the member utilities would complete the process of approving the document and would begin forming the entity a few weeks ago. He said it is now a legal entity, which is a precondition to being able to file the letter-ruling request. He said there is now a tax identification number, and the documentation will be complete in the next week to ten days. Number 1942 MR. SCHRADER said the timeframe for getting a letter of ruling depends on the section of the IRS that it goes to. He said "we" are cautiously optimistic and hope that the process is less than three months, but it could be four to six months. The key is to have as much done [as possible] so the process of the divestiture transaction can continue. MR. SCHRADER said the divestiture transaction to purchase the Four Dam Pool projects from the state needs to be complete by the end of the year. There are a number of things that need to occur prior to December 31, 2001, including: confirming the tax-exempt status of the entity; transferring licenses; having FERC licenses for each of the projects; and negotiating the sale and purchase agreement with the state. MR. SCHRADER said the firm and project management committee of the Four Dam Pool have made an effort to provide information to the Office of the Attorney General, Department of Law. The RCA is reviewing it, but has not reviewed it sufficiently to take a position. He said "we" have provided the Office of the Attorney General with "our" detailed tax analysis and there have been concerns expressed about the condemnation powers. They were also given a detailed analysis of the letter-ruling request and its background. He said it is in process, and "they" have not indicated that they object to it, but continue to have questions on the objectives, specifically, the tax analysis and tax treatment of the entity. He said the general discussion about condemnation is about whether the entity has condemnation powers, and whether that is sufficient to cause it to have governmental status for tax purposes, since there would be private interests such as the cooperative utilities in that. MR. SCHRADER said there aren't assurances when dealing with the IRS, but with this House bill amending what is currently in place, based on existing precedent, there is a substantial likelihood of getting favorable tax treatment. This is essential in order to move forward with the transaction. He assured the committee that "we" and other representatives of the project management committee have been in communication with people at the RCA, the Alaska Energy Authority (AEA), and the Office of the Attorney General. Number 1752 REPRESENTATIVE ROKEBERG referred to Section 10, which repeals and reenacts AS 42.45.310(f). It read in part: Bonds and other obligations issued by the agency and all interest and income from them and all fees, charges, funds, revenue, income, and other money pledged or available to pay or secure the payment of the bonds or obligations or interest on them are exempt from taxation. The real and personal property of an agency formed under AS 42.45.300 and this section and the assets, income, and receipts of the agency are exempt from all taxes and special assessments of the state or a political subdivision of the state, including the electric cooperative tax(AS 10.25.540 - 10.25.570). He asked if that means that since the Kodiak utility is a member, it pays an electric cooperative tax to the state. Number 1679 MR. SCHRADER said he is not sure if Kodiak does, but said this would not change. REPRESENTATIVE ROKEBERG said that the intent of the language has changed from last year's legislation, and "you come in and completely deleted that section and replaced it with language to become a tax-exempt entity." MR. SCHRADER said the JAA is a tax-exempt entity, and the member utilities' tax status is whatever it is under current law. REPRESENTATIVE ROKEBERG said he reads it to mean that whatever portion is attributable to the JAA, to Kodiak utilities, is subject to state taxation. He said he isn't sure what the intent of the legislature had been. MR. SCHRADER said he doesn't think the intent is clear because there is an entity with two types of member utilities, and how it is extrapolated from what the tax status of that entity is - based on the different tax status of its member entities - he isn't sure. MR. SCHRADER reiterated that the language in the bill was lifted from the port authority statute, which is most analogous to the JAA statute; it says municipalities can form a limited corporate entity to do certain kinds of things. Number 1576 CHAIR MURKOWSKI said with regard to tax-exempt status, an entity is better off if it meets a whole laundry list of criteria, such as the condemnation, eminent domain, and state tax status. She interprets the intent of last year's legislation to say that "you" are subject to state taxation to the extent that the entity is already subject to it and doesn't provide a wholesale state exemption. She asked if it jeopardizes the ability to get the federal tax exemption. She said it looks as if it is going contrary to what was provided for last year. Number 1521 MR. SCHRADER stated that it is one of several factors, and for the IRS these are fact and circumstance tests. He said one goes through the authority and tries to figure out the consistent themes and precedents, and looks for what is more like the JAA. He said "we" have not been able to locate, in the various pronouncements from the IRS, a private-letter ruling, or other authority that is on all four points with this; it is clearly a fact and circumstance test. The state tax treatment is one of these factors. He said it is an important factor, but probably not critical in the overall analysis based on the review of the federal tax authority as the condemnation and eminent domain powers. That seems to be the factor with the most weight, but the tax-exempt status under state law is also a factor. Number 1416 ERIC YOULD, Executive Director, Alaska Rural Electric Cooperative Association (ARECA), via teleconference, said ARECA is the statewide trade association for the electric utility industry in Alaska. He said the members include many of those that would be affected by the JAA. He testified in support of HB 119 and said the bill provides a technical fix to legislation passed last year that is very important to the ultimate completion of the $200 million endowment that provides power cost equalization for Alaska, primarily to communities throughout the state where the cost of electricity is significantly higher than in urban areas. Number 1350 MR. YOULD said HB 119, if passed by the legislature, will go a long way toward ensuring that the divestiture can take place. House Bill 119 ensures that the JAA is not subject to RCA regulation, provides eminent domain powers to the JAA, clarifies the tax-exempt status of the JAA, and limits the liability of the communities that are recipients of power from the JAA. He added that all of the clarifications, as mentioned earlier by Mr. Schrader, comport with the port authority legislation. Number 1333 MR. YOULD explained that it is the same type of information, legislation, and powers contained in the original Alaska Power Authority statutes used to develop the Four Dam Pool, the Anchorage-Fairbanks intertie, Bradley Lake, and all of the other power projects that now reside under the ownership of the AEA, the successor to the Alaska Power Authority. He further explained that there is precedence from prior legislation that these are necessary for financing and operating an entity such as the JAA. MR. YOULD said "we" were made aware, shortly after passage of last year's legislation, that there were some technical amendments that needed to take place in order to get a favorable ruling out of the IRS - to allow the divestiture to take place. Consequently, his board of directors at a December 14, 2000, board meeting adopted resolution 01-2 unanimously. He stated: It is a resolution supporting legislation that would cure defects to the Four Dam Pool Divestiture Authorization Act, passed by the legislature in the year 2000. Its final conclusion, ... [is that], ARECA supports amendments to the authorizing legislation that would cure the present defects in the underlying legislation to facilitate divestiture of the projects as originally envisioned by the parties, the parties being the governor and the legislature. Number 1200 MR. YOULD emphasized that ARECA strongly supports the legislation. There is a question about RCA jurisdiction, and the JAA would be a political subdivision with limited powers. It will be a wholesale entity, and can only sell its power to the communities that would be served. The communities would then resell that power, and there is not a problem with encroachment by the JAA within the certificated territories of the utilities that the entity serves. He said ARECA would like to see it moved through the legislature this year because the legislature imposed a date of December 31, 2001, for conclusion of the divestiture that will provide the balance of funds needed for the Power Cost Equalization Endowment fund that brings power [prices] down for the rest of the state. Number 1136 CHAIR MURKOWSKI said she agrees that "we" should do what we can to facilitate this in a timely manner, and she would like to think that these are all technical, conforming amendments. She reiterated that she has a concern over the state taxation issue. Number 1086 MR. YOULD said the JAA will provide power, for instance, to a cooperative, and the cooperative is the only entity that can sell that power, at least in its service territory. That cooperative is subject to the taxes that are on the books and pays taxes on any power that retails as a result of buying wholesale from the JAA. Number 1058 REPRESENTATIVE ROKEBERG cautioned Mr. Yould to call it "technical" because the liability issue alone is a substantive issue. He asked Mr. Yould if he recalled the legislative history of the bill from last year. Number 1035 MR. YOULD said last year HB 446 and HB 447 came late in the session and passed within a couple of months. He thought the bill had gone through the House Labor and Commerce Standing Committee but said it could have gone straight to the House Finance Committee. Number 0977 CHAIR MURKOWSKI said it is somewhat distressing to not hear comments from the RCA or the state, because they obviously have a keen interest in it. She said she would like to think that they are participating. Noting that the House Judiciary Standing Committee is the next "stop" for the bill, she said she hoped that they would be present at that time. Number 0940 REPRESENTATIVE KOTT agreed that the state should be active participants in this, but noted that other members of the public were certainly aware that this hearing was taking place. If there was an active interest, they should have showed up at the Legislative Information Offices (LIOs) or called from their own offices offline. He said Representative Rokeberg's concerns could be taken up by the House Judiciary Standing Committee. Number 0907 REPRESENTATIVE ROKEBERG asked if there was supposed to be a fiscal note. CHAIR MURKOWSKI said the person who was supposed to prepare the fiscal note had overlooked it. Number 0872 REPRESENTATIVE KOTT suggested the committee could make a motion to move the bill to the House Judiciary Standing Committee pending receipt of the fiscal note. REPRESENTATIVE ROKEBERG said Chair Murkowski had some concern about the taxation, and he is concerned about the authorization of IDBs. He said a substantial portion of the bill has to do with bonding and finance, so he is concerned about how it fits into the whole realm of things. He said taxation questions would be a more appropriate thing for this committee versus the House Judiciary Standing Committee. Number 0789 REPRESENTATIVE KOTT said the taxation questions would be for the House Finance Standing Committee, and based on the committee's recommendation, [the bill] could receive a House Finance Committee referral from the Speaker of the House. This would require a letter signed by the committee addressed to the Speaker of the House requesting that it be done. REPRESENTATIVE HALCRO said the committee has two options. If members have specific questions to be posed to the bill sponsor, then the sponsor can come back with the answers before moving the bill, and wait for the fiscal note. The other option is to express members' concerns about the issues and allow them to be provided to the committee of next referral, so the legislation can move forward. Number 0704 CHAIR MURKOWSKI said she would like to talk to people on the RCA, and that the bill will be held over. REPRESENTATIVE ROKEBERG asked if someone from the Department of Revenue could speak about the IDBs and bond allocation. [HB 119 was heard and held.]