CHAIRMAN KELLY announced the next order of business to be SB 134,                                                               
and that a proposed Senate Rules Committee substitute would be                                                                  
discussed.                                                                                                                      
                                                                                                                                
PAT CARTER, legislative aide to Senator Pearce, sponsor of SB 134,                                                              
explained the proposed CSSB 134(RLS), version Y, contains two                                                                   
changes.  The title was altered to authorize the Alaska Oil and Gas                                                             
Conservation Commission (AOGCC) to employ additional professional                                                               
staff.  That authorization is contained in Section 8, on page 4,                                                                
and allows the hire of one petroleum engineer, one reservoir                                                                    
engineer, one petroleum geologist, and one more inspector.  On page                                                             
2, line 25, the reference to water as  part of the total volume was                                                             
deleted.  When working on the regulatory cost charge, the intent                                                                
was not to substantially alter the proportional changes from the                                                                
North Slope to Cook Inlet.  Cook Inlet produces an enormous amount                                                              
of water, and that water, under a special permit, is not                                                                        
reinjected, therefore no cost is associated with AOGCC monitoring                                                               
of the water.  Consequently, the words, "and water produced" were                                                               
deleted.                                                                                                                        
                                                                                                                                
Number 054                                                                                                                      
                                                                                                                                
SENATOR PEARCE questioned why Section 8 on page 4 makes reference                                                               
to funds appropriated in FY00, since the intent of the section is                                                               
to employ the professionals on a permanent basis, not for one year.                                                             
                                                                                                                                
MR. CARTER explained it was drafted in that manner because no funds                                                             
were appropriated for that cost in the operating budget which had                                                               
already cleared the Senate.                                                                                                     
                                                                                                                                
SENATOR PEARCE questioned whether it will become part of the AOGCC                                                              
base, which will be comprised of designated program receipts.  MR.                                                              
CARTER said that is correct.                                                                                                    
                                                                                                                                
SENATOR PEARCE moved to adopt CSSB 134(RLS), version Y, in lieu of                                                              
the original bill.  There being no objection, the motion carried.                                                               
                                                                                                                                
SENATOR PEARCE moved to calendar all versions of SB 134-WELL                                                                    
REGULATORY COST CHARGE/CONS. TAX.  There being no objection, the                                                                
motion carried.