CHAIRMAN KELLY brought  SB 213  (APUC EXTENSION AND REGULATORY COST           
 CHARGE) before the committee as the next order of business and                
 directed attention to a proposed Labor & Commerce committee                   
 substitute.                                                                   
                                                                               
 JOSH FINK, committee aide, said the committee substitute deletes              
 Section 1 of the original bill that deal with the reclassifying of            
 section heads.  Also, a broader cost of power definition has been             
 inserted in the committee substitute.  He explained that with a               
 narrow definition of "cost of power" RCC rates will increase 35               
 percent, and with a broader definition of "cost of power" RCC rates           
 and other utilities rates will increase 28.8 percent.                         
                                                                               
 Number 085                                                                    
                                                                               
 CHAIRMAN KELLY asked if his understanding was correct that the RCC            
 changes are essentially revenue neutral; that they are just being             
 shifted around to the utilities and trying to readjust the rates              
 depending on how much time the APUC is spending on each of these              
 utilities.                                                                    
                                                                               
 BOB LOHR, Executive Director, Alaska Public Utilities Commission,             
 testifying from Anchorage, acknowledged that his understanding was            
 correct.  A decease in the electric rates, such as the                        
 approximately $600,000, would be shifted to either other regulated            
 utilities or pipeline carrier.  The net result to the Commission              
 would be the same.                                                            
                                                                               
 Number 100                                                                    
                                                                               
 SENATOR SHARP moved that CSSB 213(L&C), version "R," be adopted.              
 Hearing no objection, the motion carried.                                     
                                                                               
 SENATOR SHARP moved that CSSB 213(L&C) be passed out of committee             
 with individual recommendations.  Hearing no objection, it was so             
 ordered.