HJR 26-OFFSHORE OIL & GAS REVENUE SHARING  3:31:30 PM CHAIR GIESSEL announced HJR 26 to be up for consideration. 3:31:38 PM REPRESENTATIVE SADDLER, sponsor of HJR 26, Alaska State Legislature, said this resolution simply asks the federal government to enact a fair and equitable system of sharing federal revenues from offshore development. He explained that offshore oil and gas development is a boon for the country; it brings us a secure source of domestic energy, revenue and jobs, but it creates costly impacts in states like Alaska. The federal government recognizes these strains by sharing some of the proceeds of this development to help state's offset the costs for the improvements and services necessary to have responsible and safe development. On land they share half of the revenues and within three miles from shore they share 27 percent. In the four states bordering the Gulf of Mexico they share a whopping 37.5 percent. Current law says Alaska will receive a zero percent share from oil produced in the Chukchi and Beaufort Seas, Cook Inlet and offshore. Everyone knows the federal waters offshore contain a lot of oil, but development of Alaska's offshore resources require infrastructure investments including new roads, airports, utilities and housing, and additional services must be provided for including oil spill and emergency response, environmental monitoring mitigation, public health and safety. 3:34:04 PM The Chukchi and Beaufort Seas sales generated $2.75 billion and that would have brought more than $1 billion to Alaska if the same revenue sharing provisions were afforded Alaska as the Gulf of Mexico states. But Alaska didn't get a single cent. Opponents of revenue sharing argue that the federal treasury cannot afford to give up money, but Representative Saddler would argue that revenue sharing opportunities can incentivize more lease sales and bring in more development, ultimately opening up more opportunities for the federal government and states to share more money. REPRESENTATIVE SADDLER said the time couldn't be better or more opportune to have this kind of legislation move through the Congress as Senator Lisa Murkowski is the ranking member in the Senate Energy and Natural Resources Committee, and the new chair of that committee is Senator Merrill Landrew of Louisiana who is also a strong advocate for the oil industry and OCS revenue sharing. These two senators have introduced the Fixing America's Inequities with Revenue Act (FAIR ACT), which would extend to Alaska and all Outer Continental Shelf States (OCS) states the same 37.5 percent share that the Gulf States now receive. 3:35:58 PM ADRIAN HERRERA, Coordinator, Arctic Power, Washington, D.C., supported HJR 26. He said Arctic Power is a 501(c)(6) not-for- profit organization arguing for the environmentally responsible oil and gas exploration in Alaska's Arctic.{ Arctic Power strongly supports HJR 26 as it will bring parity with onshore resource development and parity with the Gulf of Mexico states which currently do enjoy revenue sharing. They believe it will allow for much safer and environmentally sound development to occur nationwide, particularly in Alaska's rural Arctic, the area closest to the most active OCS leasing areas in the nation currently. Zero revenue sharing does nothing to encourage or allow safe OCS resource development and by allowing the state to have a share of the resources will allow for a much more even playing field and safer situations as states develop their offshore areas. 3:37:49 PM SENATOR MCGUIRE joined the committee. MR. HERRERA said the House of Representatives has passed an OCS revenue sharing bill, HR 2231, that passed last summer with a vote of 2035 in favor and 186 against. This issue is quite a non-partisan issue. Senator Begich also has a revenue sharing bill, S 199, but it is Alaska-centric only and probably won't generate much support. It uses the same 37.5 percent as the Landrew Murkowski bill. MR. HERRERA said this resolution will be up against the White House view and the Bureau of Ocean Energy Management. They testified last year against the FAIR Act and their main complaint was that this will be a loss of revenue for the national treasury. But they strongly disagree and feel it is a short sighted view for many of the reasons Representative Saddler does. They believe the perceived notion that revenue sharing will take away from the President's environmental policies. Ironically, the prime beneficiary of the fund is Louisiana, Chair Landrew's home state. Further, he said if you make OCS developed and more attractive - whether it be a wind turbine or an offshore oil field - you could expect more companies to operate in these areas. Thus you would get a better revenue stream, and under revenue sharing the state would be mandated to use 10 percent of their winnings for environmental conservation, environmental mitigation and alternative energy development, which are exactly the same projects that the Land and Water Conservation Fund and the President's environmental policies are trying to achieve. CHAIR GIESSEL found no further comments and closed public testimony. 3:41:04 PM SENATOR FAIRCLOUGH moved to report HJR 26, version 28-LS1439\N, from committee to the next committee of referral with attached fiscal note and individual recommendations. SENATOR FRENCH objected, saying that about a week ago the committee heard a nearly identical resolution, SJR 5, sponsored by Senator Wielechowski, which was held in committee. He supported this resolution but wondered why the other one didn't pass. He thought his caucus member had not been treated fairly in this instance. He then withdrew his objection. Finding no further objections, Chair Giessel said HJR 26 moved from the Senate Resources Standing Committee.