SENATE BILL NO. 143 "An Act authorizing the Department of Natural Resources to enter into agreements with a person or persons desiring to own an oil or natural gas pipeline proposed to be located on state land for the purposes of providing for payment of the reasonable costs incurred in preparing for activities before receipt of an application under the Alaska Right-of- Way Leasing Act and for activities relating to the processing of an application under that Act; and providing for an effective date." Senator John Torgerson, sponsor of SB 143, indicated that SB 143 would allow them, specifically for gas lines, to collect the costs that were determined to be reimbursable on pre-applications or on the work that occurred before the application was submitted. He noted that the Senate Finance Committee struggled with the supplemental budget where there was a $4 million request and $10 million for application costs next year. He pointed out that SB 143 would allow the departments to start a memorandum process with applicants and start the reimbursement process immediately. Co-Chair Kelly wondered if Senator Torgerson was sunseting the bill. Senator Torgerson replied that there was a sunset clause in the bill for 2003. He explained that the thought process behind that was that there would be an application by the end of this year or the beginning of next year and once the application was in they would go onto existing law. He said that they decided to sunset the bill so the administration would not be able to make deals all the time, but if there were not applications in and there was still work to be done they would extend the sunset date for a couple more years. He added that it would be an easy fix. Co-Chair Kelly indicated that during the capital budget overview they did come across the request for $10 million and wondered if that was adequately covered. Senator Torgerson responded that he did look through the $10 million request and indicated that there were some expenses that would be determined to not be reimbursable. He said that he did not agree with the fiscal note, because they were basically saying that only $4 million of the $10 million would be reimbursable and he felt that it would be higher. Senator Green wondered if the department could arbitrarily charge someone who they thought was going to apply. She asked if there was any safeguard against an over-zealous implementation. Co-Chair Kelly pointed out that there were other statutes that determine what would be considered a reasonable cost. Senator Torgerson agreed that most of it would be covered under an agreement. He noted that they currently have regulations and statutes that cover reimbursable expenditures. He said that the $3.9 million discussed in the fiscal note would be reimbursable upon receiving an application. Senator Green requested clarification that the applicant would trigger the process. Senator Torgerson replied yes. Co-Chair Kelly requested clarification that the applicant would be paying fees before actually receiving the permit, whereas, in the past those fees would be paid after they received the permit. Senator Torgerson replied, "That's correct." He explained that the ones that were reimbursable could be backed up in the beginning and they would be reimbursed sometime in the future. He clarified that SB 143 would implement it now instead of waiting for a reimbursement. He referred to Senator Green's question and indicated that SB 143 stated that there could not be any charges until an actual agreement was signed; therefore, they could not just send a bill. Co-Chair Donley moved SB 143, 22-LS0667\J, from Committee with accompanying fiscal note and individual recommendations. There was no objection and SB 143 was reported from Committee.