JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 10:00 AM TAPES 11, 13 2 (Malfunction) CALL TO ORDER CO-CHAIRMAN NORMAN ROKEBERG convened the Joint Committee on Electric Utility Restructuring at 10:27 am. PRESENT Committee members present were Co-Chair Rokeberg, Senator Leman, Representative Davies, Representative Dyson. ABSENT Committee members absent were Co-Chair Sharp, Senator Taylor, Senator Adams, Representative Austerman. ALSO ATTENDING Representative Hudson; Meera Kohler, ML&P; Dan Helmick, ML&P; Paul Morrison, APUC; Bob Lohr, APUC; Mary Fisher, ARECA; Jim Patras, HEA; Eric Yould, ARECA; Robin Brena, Aurora Power; Mary Ann Pease, Aurora Power; Mike Kelly, GVEA; Carol Hegman, Chugach Electric; Don Edwards, Chugach Electric. SUMMARY OF INFORMATION OPENING REMARKS CO-CHAIR ROKEBERG: Calls roll and welcomes all committee members and people attending meeting either in person or by teleconference. Brings up draft dated January 1999, and amendments that committee members need to consider from the Co- Chair and consider any other amendments. Will have Senator Leman comment on the RFP and discuss the preparation content of the final report of the joint committee. Doesn't expect that this will take long and then will adjourn the meeting. Any comments, Senator Leman, on the RFP particularly about any dates? JOINT COMMITTEE JANUARY 6, 1999 SENATOR LEMAN: Brings to the members' attention that at the last meeting the APUC and the Legislature had/or was nearly ready to issue the request for proposal for the professional study of electric utility restructuring. Proposals were due early December; 10 respondents across the country. Senator Leman and two members of the APUC served on the selection committee, reviewed the proposals, & short-listed three firms. Held interviews on December 17th, selected a firm to begin negotiations. Post notice of intent to offer. Time period for challenges expired and the APUC went into negotiations and is currently finalizing with CH2MHill. CH2MHill was the only company to get all the 10 points of the selection process, has an in state presence. The firm will be issued a notice to proceed perhaps late this week or early next week. Work will begin soon after this. One change that was made is the date for the deliverable on the pilot project from March 12th to March 1st. Gives more time in the Legislature. The contractor is actually a team with CH2MHill and Econergy International Corporation. Recognizes two members from the APUC that are here and can answer any questions the committee may have. CO-CHAIR ROKEBERG: Any questions? Chair notes that Commissioner Ornquist and staff is here. Asks Mr. Lohr, APUC, if he would like to make any comments. REPRESENTATIVE HUDSON: Asks that the name of the company that will complete the RFP. Wasn't clear earlier. SENATOR LEMAN: CH2MHill, Econergy International Corporation. Believes that these two companies will do a professional and complete job. These companies are currently in Colorado working on a similar program. CO-CHAIR ROKEBERG: Thanks Senator Leman for all of his hard work on the RFP. Moving on to the final item on the Agenda; mentions article that Senator Sharp wanted included in the packet pertaining to the activities in Palm Spring is included and has been distributed to all members. Has requested from the Leadership the funds to subscribe to the LEAP Letter, this deals with issues relating to electrical restructuring. Begins to go over the draft and will go through each amendment and take comments from committee members. Two primary issues: changes to the body of the report, member comments. Starts with member comments, these were added for the members but not the general public. All are welcome to submit comments to be included in the final report. Recognizes Representative Davies. REPRESENTATIVE DAVIES: Submitted a one-page overview to be included in "that section". JOINT COMMITTEE ON ELECTRIC UTILITY RESTRU JANUARY 6, 1999 CO-CHAIR ROKEBERG: Senator Leman, Senator Sharp also have inserts to the report. If there is no objection asks that the committee add anything that any member of the committee wishes to add to it. In the form of their own comments, dissents on what the report may ultimately say . As there is no formal quorum, it is the Chair's intention in terms of the practical application of the report, take it up today and circulate it in Juneau prior to the 19th, and get approval by circulating a memorandum. Vote by memorandum, any objections? SENATOR LEMAN: No objection. REPRESENTATIVE DAVIES: No objection. REPRESENTATIVE DYSON: No objection. Committee members discuss possible time to have the final meeting on January 18, 1999. After a brief at ease of 2 minutes, the committee members came up with a tentative time of 10:30 am in Fahrenkamp Room. The committee discussed how to get the written comments to Co-Chair Rokeberg's office, he gave his personal fax and phone number as office computers and faxes were packed and being shipped to Juneau. CO-CHAIR ROKEBERG: Goes back to the report. Any comments, questions at this time? REPRESENTATIVE DAVIES: No problem with Amendment 1, brought up that he had made marginal notes that he would like to go through and has come up with alternative language in regards to certain parts of the report. CO-CHAIR ROKEBERG: Asks Representative Davies to go through his concerns, changes that he would like to see made on the report. REPRESENTATIVE DAVIES: Would like it stated throughout the report that comments were not solicited from the "run of the mill" residential customer. Mentions that no poll has been taken of the residential customer, brings up the problems that residential customers have had in California and also mentions the Black & Veatch report. CO-CHAIR ROKEBERG: Agrees with the point made. States staff can handle that concern, and address in the report. REPRESENTATIVE DYSON: Asked of the Chair what exactly would the staff be handling. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 CO-CHAIR ROKEBERG: Draft language into the introduction to indicate that the committee believes that we did not get enough, not enough public participation in the hearing process. REPRESENTATIVE DYSON: Stated he misunderstood and thought the Chair meant that the staff would get more comments from the public. (laughter) CO-CHAIR ROKEBERG: Looks at the report as an alert/transmittal for the public record this committee has established on this issue to pass onto the 21st Legislature. REPRESENTATIVE DAVIES: Second item page 9 paragraph 3 and a couple of other places throughout the report (3rd & 4th paragraphs). "General consensus of the committee is that electric restructuring will come to Alaska" .. another point in the next paragraph it says "recognize that some form of retail restructuring" . States that this is not clear to him. Another problem is that it is not clear what "we" mean by restructuring at this point. Instead of saying that electrical restructuring is "inevitable" say "likely" or something less certain than that. Does not want to pre-judge the results of the RFP, wait and see what the results are. REPRESENTATIVE DYSON: States he & Representative Davies are "somewhat kindred spirits". Is not eager to see restructuring happening precipitously, agrees that the wording here is okay and that some restructuring is inevitable. Agrees now is not the time. Believes restructuring is inevitable and does not find the language objectionable. CO-CHAIR ROKEBERG: Authored the report and appreciates comments. Third paragraph states "for the general consensus is that electrical restructuring will come to Alaska". It is a matter of when and how. Goes on to defend this issue, as he has been involved in this for two years. Hasn't heard anyone other than IBEW and AKPIRG make any objections to this issue. Agrees inevitable is a strong word, is open to modifying that. REPRESENTATIVE DYSON: Suggests "it appears at this time inevitable". REPRESENTATIVE DAVIES: Agrees it needs to be modified. This is his main concern. CO-CHAIR ROKEBERG: Brings up there is a legitimate debate on whether a pilot program is a good idea and to the results of a pilot program. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 REPRESENTATIVE DAVIES: Page 9, "there were a few individuals and groups that object to competition". This is not consistent with Representative Davies recollection, does not remember anybody saying they objected to competition. Remembers people being concerned about restructuring, especially in a context where there wouldn't be competition. Brought up the problem of cherry picking. CO-CHAIR ROKEBERG: Stated that reflects the views of some written testimony of IBEW & (indisc.) received by the committee that objects to competition. REPRESENTATIVE DAVIES: Doesn't believe they object to competition. CO-CHAIR ROKEBERG: "We are talking about the word competition, rather than ..perhaps delete that and change it to restructuring?" No problem with that understands his point. "Probably use electrical restructuring". REPRESENTATIVE DAVIES: Top of page 10, third sentence "the commission appears to be reluctant to do so". (indisc.) He believes that the APUC feels the proposals so far have not been adequate. CO-CHAIR ROKEBERG: Defends the language .. Talks about calling the APUC up, but does not want to put them on the spot . (laughter). REPRESENTATIVE DAVIES: States some people feel that APUC is dragging their feet, does not share that view. CO-CHAIR ROKEBERG: Defends the language "in as much as I drafted it". Believes it reflects his opinion. Brings up past testimony that the committee heard and concerns about the APUC and their ability to move ahead quickly, brings up DOCKET 97-201. States again he does not want to put them on the spot. REPRESENTATIVE DAVIES: Has heard the questions and states that the committee is impatient with the speed that the APUC (indisc.) CO-CHAIR ROKEBERG & REPRESENTATIVE DAVIES continue to speak about the APUC and their role in the RFP and the direction they will get from the Legislature. REPRESENTATIVE DAVIES: Doesn't feel the APUC is necessarily dragging their feet. States he believes they are taking a prudently cautious view. (Two or more people talking at once.) JOINT CO JANUARY 6, 1999 CO-CHAIR ROKEBERG: Open to modification of the language and would welcome his help. This report is a transmittal to the Legislature to take this matter up in a timely fashion. SENATOR LEMAN: Is frustrated with the APUC and its responses and has expressed this to the Chairman. In the last 1/2 year to 3/4 of the year the Commission has been at least from my perspective surprisingly cooperative in taking this up and I believe their interest in dealing with this is real and "I've been pleased with that." Doesn't know if that has anything to do with this committee, but has been pleased with the cooperation from the Commission. Is encouraged by what he is seeing. Does not see them proceeding blindly and being willing to make some massive changes. He believes the APUC as well as the Legislature will be very methodical in any changes that are made. REPRESENTATIVE DYSON: Agrees with the Chairman. In talking with the APUC they have been in a position of regulating monopolies. Believes the APUC is looking for some policy direction. Doesn't believe they have been saying no, but have been looking for the very thing that you are offering, Mr. Chairman. CO-CHAIR ROKEBERG: States there was a split between the various factions within the industry, as short as a year ago, about whether or not there was authority in the existing statute (indisc.). Split has "gone away" because of changing attitudes or legal interpretations, but was a major point of controversy for a number of years as to whether the APUC had the authority or not. Will be happy to work with Representative Davies in trying to modify that language in some respects, failing that to make comments in comment section about this issue. REPRESENTATIVE DAVIES: This paragraph is the source of his discomfort. (indisc.) States APUC has regulatory authority that "we" granted them. We have the statutory authority to grant competition and that they would move in that direction. Doesn't think there are any constitution issues coming up. The issue is how important the members of the committee think it is to highlight the view that there is a (indisc.) shift. It would then be appropriate for the Legislature to change the statutes to make that "underscore" to move this issue ahead, doesn't feel it is required. Doesn't feel there is any disagreement between the APUC & Legislature about who sets the policy. CO-CHAIR ROKEBERG: This was an editorial comment. Will take another stab at rewriting. Believes there is a split in the committee about whether to grant the authority to the APUC in a clearer manner. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 REPRESENTATIVE DAVIES: Believes legislation at this point will be premature, as the study has not been done. Agrees that if we want to provide them guidance that we wanted to move ahead then there's the requirements of statutory changes. Brings up universal service and believes there needs to be more discussion before moving ahead. CO-CHAIR ROKEBERG: We agree then. Let me make another stab at writing this . REPRESENTATIVE HUDSON: Dropping off the line now, will read over the report that was sent down. Doesn't have the report in front of him. Will see the committee at the January 18, 1999 meeting. Congratulates the committee on the great job they are doing. CO-CHAIR ROKEBERG: Thanks Representative Hudson and states that he will get a copy to him ASAP. SENATOR LEMAN: Asks Representative Hudson and committee members since the Representative hasn't seen the report would it be better to move the meeting to 10:00 am. Committee members discuss time of meeting and decide to meet at 10:00 am. CO-CHAIR ROKEBERG: Thanks Representative Hudson for sitting in and looks forward to seeing him on January 18, 1999. REPRESENTATIVE HUDSON: States that he and his staff are available to assist in any way possible. REPRESENTATIVE DAVIES: One more comment, under APUC (indisc.) context of the question do you want broad or narrow recommendations. CO-CHAIR ROKEBERG: Doesn't understand the question. REPRESENTATIVE DAVIES: Reads this as the APUC is asking the Legislature here for guidance. "I haven't that." When asked the APUC states they would like policy guidelines. Equating broad with policy and narrow with regulation. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 CO-CHAIR ROKEBERG: States that the committee review the minutes from the last meeting to clarify. REPRESENTATIVE DAVIES: That is my recollection. CO-CHAIR ROKEBERG: Not sure that he understands even after Representative Davies explained .. REPRESENTATIVE DAVIES: The question that was put to the committee (as recalled) would/should there be broad policy guidance or that they be micromanaged. CO-CHAIR ROKEBERG & REPRESENTATIVE DAVIES discuss this point further and CO-CHAIR ROKEBERG agrees to rewrite this point. REPRESENTATIVE DAVIES: The last issue: Pilot program, supports the pilot in some form, but the committee does not have the entire scope of the RFP, does not know the right questions to lay out. States doing the pilot program first is putting the "cart before the horse." SENATOR LEMAN: It is likely that the pilot will be restricted to the Anchorage market. Agrees with part of what he said. The consultant recognizes that the focus is on the pilot study itself limited to Anchorage. That much of the work should be done by that time and they will have the opportunity to make those comments. Doesn't feel it is inappropriate to conduct this study. Doesn't feel there will be much action or comment until after March 1st, possibly weeks after this. CO-CHAIR ROKEBERG: Believes the language in the section about the pilot program is not time sensitive. State conclusions are being drawn based on the time frame within the RFP. States two different points of view that is where the disagreement is. SENATOR LEMAN: Reiterates the thinking was .wanted the early deliverable in case any Legislative action would be necessary to deal with the pilot issue. Wanted to give adequate time to complete the study, did not want to force everything to be done at .aggressive schedule. REPRESENTATIVE DAVIES: Continues to voice his concern about the pilot program. Doesn't have a problem with the schedule. Brings up recommendations on page 18, number 2 and number 3, not recommending that. CO-CHAIR ROKEBERG: In the body, do you want to add any language about that issue. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 REPRESENTATIVE DAVIES: Wants to have added his concern about the pilot program. He will voice his concerns in his comments that he will submit to the committee. CO-CHAIR ROKEBERG: Comments are not time sensitive. SENATOR LEMAN: Voices comments on the part of the draft report that talks about the changes in the contiguous 48 states, Hawaii is also currently or has studied restructuring, like us is not under the (indisc.). It is looking at the possibilities of some of the benefits of restructuring. Will give written comments to the committee on this subject. Recommendations on page 18, second recommendation: Not fully accurate, when we get the recommendations for the design of the pilot, if there are any, not if the Legislature considers whether or not the pilot should be implemented, the Legislature will respond if there is a need for Legislative action. The Commission is going to respond to the request for pilot, not the Legislature. Legislature is not the one who should decide whether to implement the pilot or not, that is up to the APUC. "We" will implement Legislation if any is necessary. CO-CHAIR ROKEBERG: Doesn't agree with this. SENATOR LEMAN: As sponsor of the legislation to do that, is not speaking against his own legislation. If the Commission is proceeding on track and take action and is not going to hide behind the lack of statutory authority as the reason for inaction, then "I" don't see a reason to have the legislation. CO-CHAIR ROKEBERG & SENATOR LEMAN: Discuss this point further. Agree to disagree. Senator Leman will get written comments to the committee. CO-CHAIR ROKEBERG: Question is whether we need any statutory authority to proceed with the pilot or what role should the Legislature play in that particular issue. Believes the Legislature should play a role in that. SENATOR LEMAN: If necessary, "I" agree with you. CO-CHAIR ROKEBERG: Brought up his concerns about the APUC's ability to proceed without legislative authority on something like this. Statute is silent on developing a pilot program. Agrees the language needs to be reviewed on number two. Any other comments on that point. REPRESENTATIVE DAVIES: Agrees with Senator Leman. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 CO-CHAIR ROKEBERG: As this is a recommendation, there needs to be a consensus on it and make sure it is very clear. SENATOR LEMAN: Talks about possible language, states again that the pilot will be limited to Anchorage. Will submit written language to the committee that is consistent with the committee's thinking on whether to take a vote in March or April ..will give it some thought. CO-CHAIR ROKEBERG: Doesn't necessarily disagree .If the APUC has the authority to grant competition now then they would presumably have the authority to create a policy .another form of competition. Question about how and what form a program would take and what policy guidelines should be articulated by the Legislature ..the regulatory body. Who dictates the policy and how much authority Commission vs. the Legislature? SENATOR LEMAN: Wants the committee to recommend and support an implementation of a pilot in Anchorage. Would like the pilot to be designed so that it perpetrates the necessary protections to accommodate stranded costs and reliability and some of the other issues that are important. If the Legislature has to draft legislation to give that direction to the APUC, I'm perfectly happy to do that. Do not vote on whether or not there should be a pilot study in Anchorage. Believes there should be a pilot study and be designed within these broad guidelines. CO-CHAIR ROKEBERG: We will look forward to your written comments. REPRESENTATIVE DYSON: Have two suggestions for the report. Page 12 under consumer protection; move consumer protection to first and then reword it to say consumer protection/consumer advocacy to insure the consumers obtained the lowest cost power consistent with safety, reliability and long term interest. Respectfully to the committee, the electrical industry in our state have been operating in a protected monopoly and have not had the normal forces to make them get "lean, mean and efficient." Why did electric utilities wait until they were forced to; too get efficient and to look after consumer interest. Thinks we have a public policy issue. 90% of our state (geographically) will not face competition. We do not have a consumer advocacy protection function working. CO-CHAIR ROKEBERG: Appreciate your comments on moving it to first. Do you want to move the whole paragraph or .. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 REPRESENTATIVE DYSON: Move consumer protection ahead of consumer education. Add words I supplied or something like them. Will submit written language. REPRESENTATIVE DAVIES: Has a few problems with the editorial comments. Brings up concerns and his disagreement regarding the APUC and their ability to function properly. States he believes the co-ops and others have tried to keep the best interest of their customers in mind. REPRESENTATIVE DYSON: Accepts that and agrees with you, states that utilities are doing a good job and the consumer appears to be happy. What we don't have is a comparison of how good it could be. What was startling was the testimony from the producers stating that they were beginning to get leaner and meaner, starting to work at efficiency. There is quite a lot more to be done. The APUC (respectfully) waits for an issue to come in (a docket they call it), there is not a pro-active function there. Going out looking for how can our consumers get a better job done for them. It is not a part of their mission. REPRESENTATIVE DYSON: They become involved when a utility comes in asking for a rate change. Would like to go onto page 13; second paragraph, no quarrel with what you said but how you said it, Mr. Chairman, electrical service is as important as the other utility from heating, cooking (indisc.) to running electronic equipment. Would like to add a few words here that underscores how important electric power is. I would add water treatment, public safety, air traffic control rescue operations medical services and education. We have a public policy question. CO-CHAIR ROKEBERG: Any objections? Will you supply us with your written comments? We have a few minutes here to get through my amendments. Amendment one, any objections? No objections. Amendment two, any objections? No objections. Amendment three, any objections? SENATOR LEMAN: I don't have any objections, I have a one or two page elucidation of principle from Senator Murkowski that you may want to incorporate either by appendixes or acknowledge by reference in this paragraph. Will find it and give to Co-Chair Rokeberg. CO-CHAIR ROKEBERG: Comments about the states unique circumstances. That is why I put it in there. Amendment four, objections? No objections. Amendment five, objections? No objections. Amendment six, any objections? REPRESENTATIVE DAVIES: There are some ideas that relate to that. The central one is that the universal division of power. What is the analysis of that. Question is to mandate that to make basic service available. You are saying ..I don't think that I would have a problem with that unless you change the sentence a little more. JOINT COMMITTEE ON ELECTRIC UTILITY RESTRUCTURING JANUARY 6, 1999 CO-CHAIR ROKEBERG: We don't have an obligation to serve. You don't give power away just because you are a low-income person. By this I mean that you have a right for free service. That's what low-income assistance is. REPRESENTATIVE DAVIES: But, I don't think that low-income assistance is synonymous with universal service. CO-CHAIR ROKEBERG: Universal service in terms of electrical normally means providing the line out to the residence or the use and then having the cap, like the $3,000.00 cap for the line. It is not as if we are granting free consumption. In Alaska .Mr. Lohr can you explain the regulation where you can't cut off power in the winter. BOB LOHR, APUC: Mr. Chairman there is a regulation that below a certain temperature utilities shall not remove power. Even with adequate notification, adequate advance notice. The Commission several years ago viewed that question and see whether there were any utilities that were causing problems in that area and concluded there were no issues to raise the concern that the policy was adequately being observed. CO-CHAIR ROKEBERG: Is that a Commission policy? Is it in regulation? BOB LOHR: My recollection is it was a commission policy not a regulation. The question was whether or not a regulation was needed. The Commission after an extensive review of every certificate of electric utility in the state concluded that cold weather shut off was not a problem and was being handled responsibly by the electric industry. CO-CHAIR ROKEBERG: There would be no recourse to the consumer if there was a cut off in low temperature because it is not part of the law. BOB LOHR: It would be in accordance with did they follow their tariff. Is there a tariff provision that governs that and the Commission very definitely gets involved based on complaints all over the state. If there is an issue like that we have a toll- free number and we do respond to consumer complaints to insure the utilities are operating in accordance with their tariff, as well as, commissions, policies, regulations and statutes. CO-CHAIR ROKEBERG: Commissioner Ornquist would you like to make a comment on this? (End of tape, inserted new tape in recorder, tape was defective, inserted new tape) .Guidance, it reminds me of ruling by the APOC, that they decided to interpret something someway, but they didn't put it in regulation. They just decided to interpret it that way. Is it policy to do that? Policy & opinion is not law. JOINT COMMITTEE ON ELE JANUARY 6, 1999 COMMISSIONER DWIGHT ORNQUIST, APUC: Mr. Chairman I agree with you and we did debate this at quite in depth at the meetings that we have had regarding the one issue that we found very difficult to justify putting it in a regulation, was that a very effective argument is made by utilities is made that they already have difficulty collecting when the bills are high and working with the customers. If we put it in regulation or in law that they could not be cut off the point was that a lot of people would not be paying all winter long. And then the cost continues to fall to the people who do pay their bills to make up for that. The APUC would be open to direction and guidance from the Legislature on this. CO-CHAIR ROKEBERG: Representative Davies and then we will wrap this up. Forgive me for bringing for opening Pandora's box. REPRESENTATIVE DAVIES: Appreciate this discussion, what I want to know is ..tell me what the concept of universal service is? COMMISSIONER ORNQUIST: Universal service is the idea that anybody who wishes to have service would have access to the system. Just exactly as the Chairman said you have to draw some lines and establish some level at which the existing system supports that growth and where the customer needs to pick up any additional cost of expanding the system to meet that customer. CO-CHAIR ROKEBERG & REPRESENTATIVE DAVIES: Discuss and debate the concept of universal service and is it available to everybody. Is this low-income subsidy? CO-CHAIR ROKEBERG: To put a tag on this: In the discussions within the industry any subsidies low income assistance (indisc.) included under the umbrella of universal service by definition. That is why the disclaimer is there. Many jurisdictions provide subsidized electrical service, they put this in their tariff structure. We have power cost equalization programs. REPRESENTATIVE DAVIES: Goes back to the amendment, line three. Question: Mandate on .long term assistance, conservation programs. Separate issues. Geographical area concerns. CO-CHAIR ROKEBERG: Will strike amendment six. JOINT COMMITTEE ON ELECTR JANUARY 6, 1999 REPRESENTATIVE DYSON: Brings up universal service, when brought up in the past was thinking about how it was defined in telecommunications. "Affordable" is one word that is not in the discussion between Co-Chair & Representative Davies. Need to have a full public policy decision sometime, is there a public responsibility to make sure that power is available for utilities. CO-CHAIR ROKEBERG: That is why I had the amendment, to introduce the concept. REPRESENTATIVE DAVIES: Agrees that affordable is inherent with universal service, there is a subsidy involved. But does not differentiate between consumers within a geographic area. Everybody gets the same price, that's the notion of universal service. Inherent subsidy problem. REPRESENTATIVE DYSON: Agrees got it the first time. CO-CHAIR ROKEBERG: Chair notes; I have withdrawn the amendment. Amendment 7, any objections? No objections. Amendment 9, any objections? No objections. Amendment 10, any objections? No objections. Page 16, line 1 ..line one paragraph 4, Senator Leman, any comments. Will adopt that. Conclusions better take a look at that. SENATOR LEMAN: Offers as an amendment, the replacement of current recommendation 2 with "my" language which incorporates what "I" am trying to say. Positive way, doesn't commit the Legislature. CO-CHAIR ROKEBERG: Leave the target date in of March 1? SENATOR LEMAN: That is currently our target date, we might as well acknowledge it. March 1, 1999. CO-CHAIR ROKEBERG: Conception amendment is now moved, any objections? No objections, it is adopted to replace recommendation number two. Any further activity or comments? Will schedule the meeting for the 18th at 10:00 am, communicate to the other committee members that they are invited to have their written comments, get a draft out in a timely fashion to everybody. Target no later than Saturday, 16th. Any other comments? Thank you very much, meeting adjourned at 12:20 pm. The meeting was recorded and handwritten log notes were taken. A copy of the tapes and log notes may be obtained by contacting the House Records Office at 130 Seward Street, Suite 211, Juneau, Alaska 99801-1182, and after adjournment of the second session of the Twentieth Alaska State Legislature in the Legislative Reference Library.