HJR 42 WATER CARRIERS SERVING ALASKA                          
                                                                               
 Number 014                                                                    
                                                                               
 CHAIRMAN RIEGER called the Senate Transportation meeting to order             
 at 2:30 p.m. and introduced  HJR 42  as the first order of business           
 before the committee.                                                         
                                                                               
 PAUL FUHS, representing Sealand Services, explained that shippers,            
 municipalities, unions, truckers and the railroad all agree that              
 HJR 42 is needed.  The consumers and providers both consider HJR 42           
 a necessary part of regulation.  In response to Chairman Rieger,              
 Mr. Fuhs noted that because of a letter from Fairbanks distributors           
 the amendment was proposed and unanimously adopted on the House               
 floor.  The amendment changed the language on page 2, line 5 to               
 refer to the transfer of the regulatory authority not the                     
 regulatory system as in the original bill.                                    
                                                                               
 SENATOR TAYLOR asked why water transportation was being transferred           
 from the Interstate Commerce Commission (ICC) to the United States            
 Department of Transportation; will the U.S. Department of                     
 Transportation regulate the water transportation?  PAUL FUHS said             
 that the U.S. Department of Transportation would regulate the water           
 transportation; the ICC will be eliminated.  Mr. Fuhs offered to              
 discuss the economic concerns of HJR 42 and the reasons everyone              
 supports this legislation.                                                    
                                                                               
 SENATOR TAYLOR indicated that he had some concerns about this type            
 of regulated commerce.  He acknowledged that there are probably               
 some valid reasons to regulate this, but there are other reasons              
 that are frustrating.  Senator Taylor discussed the problems his              
 communities face since they are totally dependent on air and water;           
 the high cost of water and air transportation.  He did not want to            
 support the process that would continue the high air and water                
 transportation rates in his communities.                                      
                                                                               
 Number 095                                                                    
                                                                               
 PAUL FUHS pointed out that the Chamber of Commerce, and                       
 distributors such as Anchorage Cold Storage, and other customers              
 believe that this bill would maintain lower prices.  With complete            
 deregulation, there could be a battle of the Titans in which one              
 company puts another out of business.  The results of such a battle           
 would be astronomical rates similar to those in Southeast with one            
 air carrier.  For that reason, there is support for this.  Mr. Fuhs           
 offered to speak with Senator Taylor further regarding this issue.            
                                                                               
 SENATOR GREEN moved that HJR 42 am be moved out of committee with             
 individual recommendations.  Hearing no objection, it was so                  
 ordered.