SENATE BILL NO. 196 "An Act relating to the use of certain unexpended earnings from the power cost equalization endowment fund." 3:26:13 PM Co-Chair Kelly MOVED to ADOPT the committee substitute for SB 196, Work Draft 29-LS1383\V (Nauman, 4/9/16). Co-Chair MacKinnon OBJECTED for DISCUSSION. 3:26:59 PM LAURA CRAMER, STAFF, SENATOR ANNA MACKINNON, explained the difference between version F and version V of the bill. She looked at page 1, line 12, following the reference to reference to AS 42.45.080c. She announced that the number 1 was inserted, which referenced the above section on line 7. She stated that the language, "for the fiscal year beginning the following July 1." She announced that the version read, "c.1 may be appropriated for the following purposes." She looked at page 2, subsection d, following the statute reference AS 42.45.080c, the number 2 was inserted. The number 2 referenced Section 1, subsection 2. She shared that page 2, line 11, following "appropriation under (a) of the section" inserted the phrase "for the current fiscal year." She stated that it had previously read, "for the previous fiscal year." She shared that following the statute reference on line 13, AS 42.45.080c, the number 2 was inserted, which referenced Section 1. She looked at subsection 1, line 16, which allowed for appropriating 30 percent or $30 million, whichever is less, to the Community Revenue Sharing or Community Assistance Fund. The following subsection allowed for appropriation to the Renewable Energy Grant Fund, and the committee added "Bulk Fuel Revolving Loan Fund" and the "Rural Power System Upgrades." The percentage changed from 30 percent to 20 percent. She furthered that $25 million was added, whichever was less. She announced that an effective date of June 30 of the current year was added to the bill. She shared that any excess earnings would either return to or stay in the Power Cost Equalization (PCE) Endowment Fund. Co-Chair MacKinnon REMOVED her OBJECTION. There being NO further OBJECTION, the proposed committee substitute was ADOPTED. Co-Chair MacKinnon queried the impact of the change to Power Cost Equalization in the numbers that were included as maximums that could be withdrawn from the fund. 3:31:18 PM DAVID TEAL, DIRECTOR, LEGISLATIVE FINANCE DIVISION, looked at the spreadsheet titled, "Power Cost Equalization Endowment Fund - Impacts of SB 196" (copy on file). He remarked that the purpose of the bill was to determine how to manage excess earnings to the PCE Endowment Fund. He noted that Section 3, subsection d outlined the action for the excess earnings. The noted the highlighted yellow columns, which showed the repeat of experience from 2004 to the current day. It was not intended as a prediction of interest rates, rather it was an example of some higher and negative rates. The column showed years of excess earnings and years of insufficient earnings. He looked at Section 3, which stated that "if the 5 percent payout was insufficient to pay the Power Cost Equalization amount", as listed under program costs in the spreadsheet, "then Power Cost Equalization will be prorated." He furthered that if there was insufficient funds, then there was no money available for Community Assistance or Rural Energy programs. He stated that, if there was excess money, 50 percent of the amount available for allocation would be put in Community Assistance. Co-Chair MacKinnon queried comments for the committee to consider. Senator Hoffman replied that the CS was improved, especially when examining the available scenarios. SB 196 was HEARD and HELD in committee for further consideration.