HOUSE SPECIAL COMMITTEE ON UTILITY RESTRUCTURING March 17, 1999 8:03 a.m. MEMBERS PRESENT Representative Bill Hudson, Chairman Representative John Cowdery, Vice Chairman Representative Pete Kott Representative Norman Rokeberg Representative Brian Porter Representative John Davies Representative Ethan Berkowitz Representative Joe Green (alternate) MEMBERS ABSENT All members present COMMITTEE CALENDAR HOUSE BILL NO. 62 "An Act relating to the Alaska Public Utilities Commission; and providing for an effective date." - MOVED CSHB 62(URS) OUT OF COMMITTEE PRESENTATION: TOM STAHR - MANAGER OF CORDOVA ELECTRIC: PILOT STUDY OBSERVATIONS/ELECTRIC COMPETITION IN RURAL ALASKA PRESENTATION: JACK RHYNER - ALASKA TELEPHONE ASSOCIATION: UNIVERSAL SERVICE FUND/PHONE COMPETITION PRESENTATION: GARY BROOKS - INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS UNION (IBEW): COMPETITION (* First public hearing) PREVIOUS ACTION BILL: HB 62 SHORT TITLE: ALASKA PUBLIC UTILITIES COMMISSION SPONSOR(S): REPRESENTATIVES(S) THERRIAULT Jrn-Date Jrn-Page Action 1/22/99 68 (H) READ THE FIRST TIME - REFERRAL(S) 1/22/99 69 (H) URS, L&C 2/08/99 172 (H) FIN REFERRAL ADDED 2/17/99 (H) URS AT 8:00 AM CAPITOL 120 2/17/99 (H) HEARD AND HELD 2/17/99 (H) MINUTE(URS) 3/10/99 (H) URS AT 8:00 AM CAPITOL 120 WITNESS REGISTER WILDA RODMAN, Legislative Administrative Assistant to Representative Gene Therriault Alaska State Legislature Capitol Building, Room 511 Juneau, Alaska 99801 Telephone: (907) 465-4797 POSITION STATEMENT: Testified on behalf of sponsor on HB 62. TOM STAHR, Interim General Manager Cordova Electric Cooperative Address not provided Telephone: (Not provided) POSITION STATEMENT: Discussed observations on the pilot study and electric competition in rural Alaska. JACK RHYNER, President Tel Alaska Incorporated 2121 Abbott Road Anchorage, Alaska 99507 Telephone: (907) 349-3400 POSITION STATEMENT: Presented a report on the Universal Service Fund and phone competition. GARY BROOKS, Business Manager International Brotherhood of Electrical Workers Union (IBEW) 2702 Denali Street Anchorage, Alaska 99503 Telephone: (907) 272-6571 POSITION STATEMENT: Discussed competition and its effects on the International Brotherhood of Electrical Workers Union. ACTION NARRATIVE TAPE 99-8, SIDE A Number 0001 CHAIRMAN BILL HUDSON called the House Special Committee on Utility Restructuring meeting to order at 8:03 a.m. Members present at the call to order were Representatives Hudson, Cowdery, Kott, Porter, and Green (alternate). Representatives Berkowitz, Davies, and Rokeberg arrived at 8:05 a.m., 8:05 a.m., and 8:23 a.m., respectively. HB 62 - ALASKA PUBLIC UTILITIES COMMISSION CHAIRMAN HUDSON announced the first order of business is HB 62, "An Act relating to the Alaska Public Utilities Commission; and providing for an effective date." CHAIRMAN HUDSON indicated there is a proposed committee substitute and called for a motion to adopt it. Number 0102 REPRESENTATIVE COWDERY made a motion and asked unanimous consent to adopt the proposed committee substitute for HB 62 (1-LS0327\H, Cramer, 3/15/99) for discussion purposes. There being no objection, it was so adopted. CHAIRMAN HUDSON called on the sponsor. Number 0167 WILDA RODMAN, Legislative Administrative Assistant to Representative Gene Therriault, Alaska State Legislature, stated the sponsor is not here because of a conflict with a House Finance Standing Committee meeting. CHAIRMAN HUDSON announced the arrival of Representatives Berkowitz and Davies. CHAIRMAN HUDSON stated the proposed committee substitute tightens the title and isolates the bill to simply the expansion of the sunset date. It also modifies the length of the sunset expansion from the original bill. He asked Ms. Rodman to speak to the proposed committee substitute. MS. RODMAN stated the prime sponsor doesn't have a problem with the length of the sunset, but the sponsor has a problem with splitting the issues into separate bills. Representative Therriault believes that all the issues should be dealt with without ushering through the sunset, otherwise problems might not get addressed. Number 0253 REPRESENTATIVE COWDERY stated the important thing is the sunset and any other issues that has been discussed in the past should be part of a separate piece of legislation. Number 0276 CHAIRMAN HUDSON noted that was the consensus he started to hear from the committee members. Number 0308 REPRESENTATIVE PORTER understands the desire of the prime sponsor and the urgency to try to do something to help the Alaska Public Utilities Commission (APUC). However, he is concerned because there are all sorts of things that people want to do to the APUC for various reasons that could be added to a loose title subverting the wishes of the sponsor and this committee. He prefers the proposed committee substitute. Number 0375 REPRESENTATIVE KOTT shares the same concerns of Representative Porter. Having been in management/administration for most of his life, he would like to do a lot of things that could benefit the APUC. And, if he's out there as 1 member of the legislature, there are probably 59 other members that could equally do something similar. He noted he could go either way with the length of the sunset - two years or four years. He supports the proposed committee substitute in its present form. Number 0483 CHAIRMAN HUDSON announced that this doesn't eliminate the other elements that have been before the committee. He has instructed staff to wait for the audit report, to look at the recommendations, and to prepare a working document for the committee to discuss. He feels comfortable with the proposed committee substitute. It's limited, tight and brings it back to the legislature in two years which gives the legislature an opportunity to see what has happened during that interim period of time. It also gives the APUC enough time to continue its operation without ending up in a fiscal or financial situation. Number 0573 REPRESENTATIVE DAVIES agrees with the approach, but wonders whether two years is enough time to evaluate, measure and judge any change, assuming a bill is pushed through that makes changes. He would feel more comfortable with three years. Number 0634 REPRESENTATIVE GREEN supports the two speakers prior to Representative Davies. If there is a personality problem within the commission, some of that will be taken care of within the next few months. The biggest issue is the inefficiency of the commission's operation and two years is certainly enough time to see whether that has been corrected. All of the problems might not have been solved, but it will show whether it is on the right track. He is concerned it might get shoved behind other issues with an arbitrary extension of three or four years, and in that case, nobody is really accountable. He supports a two year extension. Number 0768 REPRESENTATIVE PORTER made a motion to move the proposed committee substitute for HB 62 (1-LS0327\H, Cramer, 3/15/99) out of committee with individual recommendations and the attached fiscal note(s). There being no objection, CSHB 62(URS) was so moved from the House Special Committee on Utility Restructuring. PRESENTATION: TOM STAHR-MANAGER OF CORDOVA ELECTRIC: PILOT STUDY OBSERVATIONS/ELECTRIC COMPETITION IN RURAL ALASKA TAPE 99-8, SIDE(S) A SUMMARY OF INFORMATION TOM STAHR, Interim General Manager, Cordova Electric Cooperative, testified via teleconference from Cordova. He read from a handout titled, "Testimony of Thomas Stahr". PRESENTATION: JACK RHYNER-ALASKA TELEPHONE ASSOCIATION: UNIVERSAL SERVICE FUND/PHONE COMPETITION TAPE 99-8, SIDE(S) A & B SUMMARY OF INFORMATION JACK RHYNER, President, Tel Alaska Incorporated, came before the committee and read from a handout titled, "Competition in Rural Alaska". PRESENTATION: GARY BROOKS-INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS UNION (IBEW): COMPETITION TAPE 99-8, SIDE(S) B SUMMARY OF INFORMATION GARY BROOKS, Business Manager, International Brotherhood of Electrical Workers Union (IBEW), came before the committee and discussed the effects of competition on the IBEW. COMMITTEE ACTION The Committee took no action. ADJOURNMENT There being no further business before the committee, the House Special Committee on Utility Restructuring meeting was adjourned at 9:37 a.m. NOTE: The meeting was recorded and handwritten log notes were taken. A copy of the tape(s) and log notes may be obtained by contacting the House Records Office at 130 Seward Street, Suite 211, Juneau, Alaska 99801-1182, (907) 465-2214, and after adjournment of the second session of the Twenty-first Alaska State Legislature, in the Legislative Reference Library.