Legislature(2009 - 2010)BARNES 124

03/09/2010 03:00 PM ENERGY


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ HB 278 ENERGY EFFICIENT HOME GRANT FUND TELECONFERENCED
Heard & Held
+= HB 164 IN-STATE PIPELINES: LEASES; CERTIFICATION TELECONFERENCED
<Bill Hearing Canceled>
*+ HB 411 POWER PROJECT FUND TELECONFERENCED
Heard & Held
+ Bills Previously Heard/Scheduled TELECONFERENCED
+= HB 305 OMNIBUS ENERGY BILL TELECONFERENCED
Heard & Held
            HB 278-ENERGY EFFICIENT HOME GRANT FUND                                                                         
                                                                                                                              
3:38:52 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT announced that the  next order of business would                                                               
be HOUSE BILL NO. 278, "An  Act relating to the administration of                                                               
the  Alaska  energy  efficient  home grant  fund  by  the  Alaska                                                               
Housing Finance Corporation."                                                                                                   
                                                                                                                                
3:39:20 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK presented  an overview of HB 278,  as a prime                                                               
co-sponsor.     He   explained   that   Alaska  Housing   Finance                                                               
Corporation's  (AHFC) energy  rebate and  weatherization programs                                                               
are  successfully  helping  some  families  by  providing  energy                                                               
efficiency improvements to their homes.   These programs are also                                                               
creating  and  sustaining  jobs;   in  fact,  orders  for  doors,                                                               
windows,  insulation, and  other energy  saving home  improvement                                                               
projects are  keeping builders  and suppliers  busy.   The energy                                                               
rebate  program has  a 70  percent completion  rate for  families                                                               
that  are able  to  make  the initial  investment.   However,  if                                                               
homeowners  do  not  have  sufficient   cash,  they  cannot  take                                                               
advantage  of the  energy rebate  program.   Representative  Tuck                                                               
observed that  homeowners who may not  have cash, or access  to a                                                               
source for  credit at a  reasonable interest rate, are  those who                                                               
need this program  the most.  Homeowners in this  category do not                                                               
qualify  for low-income  weatherization  assistance,  yet do  not                                                               
have  several  thousand  dollars  to pay  for  energy  efficiency                                                               
upgrades, and  then wait  to be reimbursed.   This  is especially                                                               
true in rural  areas, where energy costs are highest,  and HB 278                                                               
will   help  solve   that  problem   by  putting   energy  saving                                                               
opportunities within the reach of  more families.  Representative                                                               
Tuck re-stated  that HB 278  will allow more Alaskan  families to                                                               
participate  in the  energy efficiency  rebate  program and  will                                                               
continue to  keep tradesmen working  year around.  The  bill does                                                               
this by allowing the homeowner to  receive a voucher for the same                                                               
amount of money  as the rebate.   The voucher can be  used by the                                                               
homeowner to pay  contractors and suppliers, so that  work on the                                                               
home can begin.   He opined HB 278 is  a simple authorization for                                                               
a  voucher concept  that can  be administered  by AHFC  to ensure                                                               
smooth   processing    by   homeowners,    contractors,   housing                                                               
authorities,   and  others   involved  in   voucher-based  energy                                                               
efficiency upgrades.  The bill does  not change the amount of the                                                               
payments,  or the  state's  level of  participation  in the  home                                                               
energy efficiency program.                                                                                                      
32:41 PM                                                                                                                      
                                                                                                                                
AURAH  LANDAU, staff,  Representative  Chris  Tuck, Alaska  State                                                               
Legislature, presented additional information  about the need for                                                               
a voucher-type program.  She  noted that AHFC surveyed applicants                                                               
who did  not complete  the energy rebate  program and  found that                                                               
about  one-fifth  of  those  enrolled  will  not  do  the  energy                                                               
improvements  because  they   do  not  have  the   funds.    This                                                               
percentage  is estimated  to be  1,600 applicants,  not including                                                               
those who  did not  apply because  they do not  have the  cash on                                                               
hand.  Ms. Landau described HB 278  also as a jobs bill; in fact,                                                               
the voucher  concept was suggested  by a contractor  who observed                                                               
that the voucher  program could keep more  contractors working on                                                               
energy efficiency  projects.  She  advised that the  statute that                                                               
created  the   rebate  program  simply  authorizes   home  energy                                                               
rebates; similarly,  HB 278 is  a broad authorization  that gives                                                               
AHFC the discretion  to administer a voucher  program "however it                                                               
would  work  best  for  those  involved."   Ms.  Landau  began  a                                                               
sectional analysis  of the  bill.  Page  1, lines  8-11, codifies                                                               
the existing  home energy  rebate program,  and the  remainder of                                                               
the bill adds a voucher  capability giving AHFC the discretion to                                                               
develop  implementing regulations,  and  grant the  voucher in  a                                                               
manner  that assures  the energy  improvements are  completed and                                                               
the  voucher is  fulfilled by  the  correct party.   She  further                                                               
explained that a voucher is a  document that says "that the state                                                               
is  good for  up to  a certain  amount of  money for  home energy                                                               
efficiency work  and outlines for  the homeowner and  any vendors                                                               
they may  work with,  contractors, lumberyards  ... what  work is                                                               
eligible for payment  and it also stipulates the  payment is made                                                               
once the  final energy audit is  done."  For example,  AHFC could                                                               
develop language to guarantee that  "the right entity is required                                                               
to do the right thing at the right time."                                                                                       
                                                                                                                                
3:46:41 PM                                                                                                                    
                                                                                                                                
MS.  LANDAU  continued  to  explain that  the  mechanism  of  the                                                               
voucher system is nearly identical  to the existing rebate system                                                               
in  that  the   homeowner  pays  for  the  as-is   audit  and  is                                                               
reimbursed.     The  as-is  audit  gives   the  homeowner  energy                                                               
efficiency  improvement  options,  and  she  referred  to  sample                                                               
energy ratings  provided in  the committee  packet.   The voucher                                                               
program differs when, along with  the audit report, the homeowner                                                               
gets  a voucher  to give  to  contractors or  supply houses  that                                                               
choose to  participate.  This  saves the homeowner from  paying a                                                               
down  payment, or  payment in  full "up  front."   Afterward, the                                                               
voucher  program works  the same  as  the rebate  program as  the                                                               
homeowner  gets the  work  done,  completes the  post-improvement                                                               
energy  rating  that certifies  the  level  of energy  efficiency                                                               
gained,  and then  the allowable  payment  is made.   Ms.  Landau                                                               
clarified that the  homeowner is responsible for  all costs above                                                               
those  authorized by  the post-improvement  audit.   Furthermore,                                                               
the voucher  informs contractors  that the state  will pay  for a                                                               
certain  portion of  the cost  of improvements.   She  emphasized                                                               
that contractors and  supply houses can decide whether  or not to                                                               
accept  vouchers.   Finally,  the  homeowner  and lumberyard,  or                                                               
contractor, will sign  off on the reimbursement  before AHFC pays                                                               
the vendors.                                                                                                                    
                                                                                                                                
3:49:23 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RAMRAS stated  that he  loved the  intent of  the                                                               
bill,  but  will  not support  it.    He  gave  an example  of  a                                                               
contractor  forced  into  bankruptcy  because  "dishonest  things                                                               
happened," and pointed  out the bill lacks  an oversight function                                                               
that will perform the duties  of a disbursement officer, and make                                                               
sure that  the work is done.   He described his  understanding of                                                               
how the present program works,  and expressed his empathy for the                                                               
homeowner; however,  with a voucher,  if either the  homeowner or                                                               
the   contractor  is   not  scrupulous,   the  program   will  be                                                               
compromised.                                                                                                                    
                                                                                                                                
3:53:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  explained that currently the  rebate program                                                               
withholds payment until  after the second audit is  done, all the                                                               
work  is performed,  and all  of the  receipts are  turned in  to                                                               
AHFC.  HB  278 retains these same conditions in  that no payments                                                               
are  made  until  all  work  is complete,  the  second  audit  is                                                               
performed,  and  after  the  invoices   are  signed  off  by  the                                                               
homeowner and contractor, payments are  made by AHFC.  He pointed                                                               
out that  this program is  not a  payment of "up-front  cash," or                                                               
progressive payments,  but basically lets a  contractor know that                                                               
AHFC will be reimbursing the project as determined by AHFC.                                                                     
                                                                                                                                
3:54:00 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  RAMRAS described  the present  process and  noted                                                               
that  Bryan Butcher,  who  was  in the  galley,  agreed with  his                                                               
understanding of the  program.  With the terms of  HB 278, if the                                                               
contractor's  work   is  deficient  and  does   not  qualify  for                                                               
reimbursement,  the program  fails,  unlike  the present  program                                                               
that requires a fully satisfactory job.                                                                                         
                                                                                                                                
3:55:54 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  advised  that   the  original  bill  "never                                                               
spelled  out  that there  would  be  an energy  rebate  program."                                                               
However, AHFC determined  the methods and checks  and balances to                                                               
administer the program,  and now homeowners could  get the needed                                                               
energy  improvements as  the bill  intends.   He opined  that the                                                               
scenario  presented by  Representative Ramras  was also  possible                                                               
with the  current program, because the  homeowners are ultimately                                                               
responsible for the quality of  construction.  The same standards                                                               
apply  for either  the rebate  or the  voucher program,  and AHFC                                                               
will not  make a payment  until the second  audit is done  to its                                                               
standards.  The voucher is simply  a document that states for the                                                               
homeowner, contractor,  or lumberyard,  that a certain  amount of                                                               
money is approved  for home energy efficiency work,  and that the                                                               
payment will  be made after  the final  audit is done  to certify                                                               
the energy savings.                                                                                                             
                                                                                                                                
3:57:44 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  MILLETT expressed  her  understanding  that AHFC  could                                                               
administer  grant funds  or vouchers  under the  current statute.                                                               
She  acknowledged that  there is  a need,  but asked  whether the                                                               
bill sponsors  determined if AHFC  could administer  this program                                                               
through regulation, or if legislation is required.                                                                              
                                                                                                                                
3:59:09 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  stated that  the bill co-sponsors  have been                                                               
working with AHFC since November [2009].   In fact, AHFC saw that                                                               
the program was  missing the needs of a group  of homeowners, and                                                               
conducted a  poll of  those who  were able to  be involved  in an                                                               
original audit.   In December, no  action was taken, so  the bill                                                               
was  pre-filed.   Representative Tuck  spoke of  efforts made  by                                                               
him, and Senator Meyer, to  assist a constituent, and pointed out                                                               
that this program  would fill a need for people  who want to take                                                               
advantage  of reduced  utility costs  and who  "would love  to be                                                               
part of this  program, but just aren't able to  come up with that                                                               
up-front $10,000."                                                                                                              
                                                                                                                                
4:01:46 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT re-stated her question.                                                                                        
                                                                                                                                
4:01:50 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK expressed his hope  for guiding the agency to                                                               
a simple method to accomplish the intent of this bill.                                                                          
                                                                                                                                
4:02:19 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAMRAS noted that  the [energy rebate] program has                                                               
a  zero default  rate.   He gave  an example  of how  the voucher                                                               
program could lead to default.                                                                                                  
                                                                                                                                
4:03:51 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  responded that  as the  program is  now, the                                                               
ultimate responsibility  to make  up for  a shortfall  rests with                                                               
the homeowner.   In fact,  the audit  indicates the cost  of each                                                               
improvement, and homeowners can pick  and choose what projects to                                                               
complete.  He assured the committee  the intent is for no further                                                               
liability to AHFC.                                                                                                              
                                                                                                                                
4:05:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE RAMRAS  anticipated that the voucher  program will                                                               
lead to defaults,  and problems similar to those  that occur when                                                               
building a custom home.  He gave examples of possible problems.                                                                 
                                                                                                                                
4:07:57 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK asked  the  committee to  review the  sample                                                               
home energy  voucher language  pre-work authorization  and sample                                                               
post-work payment  authorization.  He read  [original punctuation                                                               
provided]:                                                                                                                      
                                                                                                                                
     Alaska  Housing and  Finance Corporation  guarantees up                                                                    
     to $_____  for the  home energy  efficiency work  to be                                                                    
     completed at the property located  at _______ and owned                                                                    
     by ______.                                                                                                                 
                                                                                                                                
     The actual amount of payment  by Alaska Housing Finance                                                                    
     Corporation  is  determined  by the  increase  in  home                                                                    
     energy  ratings   by  comparing  the  pre-   and  post-                                                                    
     improvement energy audits, and capped at $10,000.                                                                          
                                                                                                                                
     If the amount of  the expenditures for the improvements                                                                    
     exceeds the  amount of the reimbursement  authorized by                                                                    
     AHFC,   the   amount   owing    shall   be   the   sole                                                                    
     responsibility of the homeowner.                                                                                           
                                                                                                                                
     In  any case,  the vendor's  sole remedy  is to  pursue                                                                    
     payment from the homeowner.                                                                                                
                                                                                                                                
     The    homeowner   and    vendor   acknowledge    their                                                                    
     responsibilities  and duties  before work  is begun  by                                                                    
     signing below.                                                                                                             
                                                                                                                                
REPRESENTATIVE TUCK  acknowledged that some contractors  will not                                                               
want  to   take  vouchers;  however,   the  vouchers   offer  the                                                               
opportunity to those who wish to provide services.                                                                              
                                                                                                                                
4:09:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN  referred to  AS  18.56.410.   He  said,                                                               
"[Subsection]  (a) says  'the  corporation  shall administer  the                                                               
energy  efficient  home  grant   under  the  provisions  of  this                                                               
section.'"  He then said,  "[Subsection] (c) says the corporation                                                               
shall  adopt guidelines  and procedures  ... but  in [subsection]                                                               
(b), where  you're amending it,  in the current statute,  it says                                                               
the corporation,  ... AHFC, may  grant funds from the  grant fund                                                               
to  agencies, the  federal government,  individuals, et  cetera."                                                               
Representative Johansen  observed the  agency has the  ability to                                                               
make  decisions about  its  course  of action.    He agreed  with                                                               
Representative Ramras  about the concept  of HB 278;  however, he                                                               
expressed discomfort  at the use  of the word "shall"  that tells                                                               
AHFC "to do something, when they can, and they're not."                                                                         
                                                                                                                                
4:11:14 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  MILLETT asked  the  co-sponsor about  use  of the  word                                                               
"shall."                                                                                                                        
                                                                                                                                
4:11:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK offered to amend the language.                                                                              
                                                                                                                                
4:12:20 PM                                                                                                                    
                                                                                                                                
MS.  LANDAU reviewed  statements  of support  for  the bill  from                                                               
regional  housing  authorities  and the  Association  of  Village                                                               
Council  Presidents in  Bethel.   She  also found  weatherization                                                               
crews training for work in rural  areas.  Turning to the question                                                               
of  whether the  loan  program offered  through  AHFC solves  the                                                               
problem addressed  by HB  278, she advised  that securing  a loan                                                               
results  in  a second  mortgage,  and  only 100  homeowners  have                                                               
applied for a loan with credit ramifications.                                                                                   
                                                                                                                                
4:14:10 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK noted  that AHFC's  second mortgage  lending                                                               
program is  good and  has a  low interest  rate; however,  HB 278                                                               
simplifies the process.                                                                                                         
                                                                                                                                
4:14:40 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT referred  to the fiscal note  and questioned the                                                               
need  to add  seven full-time  employees to  a program  that will                                                               
help a small portion of residents.                                                                                              
                                                                                                                                
4:15:56 PM                                                                                                                    
                                                                                                                                
BRYAN   BUTCHER,   Director,   Governmental  Affairs   &   Public                                                               
Relations, Alaska Housing  Finance Corporation (AHFC), Department                                                               
of  Revenue (DOR),  provided some  background  on the  bill.   He                                                               
assured  the committee  AHFC  wants  to make  sure  that as  many                                                               
Alaskans  as  possible can  take  advantage  of the  home  energy                                                               
rebate  program.     In   fact,  AHFC   was  interested   in  the                                                               
participation rate and  why some applicants did  not complete the                                                               
program,  but had  no data  at the  end of  the last  legislative                                                               
session.  Gathering  data was further delayed by  the shortage of                                                               
energy raters.   Mr.  Butcher agreed  with Co-Chair  Millett that                                                               
without  sufficient  information,  the agency  could  spend  more                                                               
money  trying to  solve  a problem  than the  cost  of the  group                                                               
needing  help.     AHFC  has  received  feedback   from  only  50                                                               
applicants who  did not  use the  program at the  end of  the 18-                                                               
month time limit, and the  most popular reason for not completing                                                               
the rebate  process is that the  home is already rated  with a 4-                                                               
Star  Plus  energy  rate.    Another issue  is  that  the  second                                                               
mortgage weatherization  loan program would be  more popular, but                                                               
has  not been  advertised  sufficiently.   Mr. Butcher  explained                                                               
that the  maximum loan amount is  $30,000 for 15 years  at a rate                                                               
of 4.75 percent,  and for a loan of $15,000,  loan payments would                                                               
be about $115 per  month.  In fact, if a  homeowner paid the loan                                                               
back with his  or her rebate, the resulting  energy savings would                                                               
pay back the interest within a  year or two.  Currently, the loan                                                               
information is  included in mail-outs and  statewide advertising,                                                               
and a  better job  of advertising would  probably result  in more                                                               
interest in  the loan program.   Mr. Butcher opined that  in most                                                               
cases applicants  can afford taking out  a small loan to  get the                                                               
energy efficiency work  done, especially if most of  the loan was                                                               
repaid by the rebate within 18 months.                                                                                          
                                                                                                                                
4:20:12 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT referred  to the fiscal note  and questioned the                                                               
need for seven full-time employees to administer this program.                                                                  
                                                                                                                                
4:20:30 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER  explained AHFC's biggest  concern is  about possible                                                               
fraud investigation.   For  example, if  an applicant  receives a                                                               
voucher for  $10,000 and the  post-rater allows only  $6,000, the                                                               
homeowner may turn to AHFC.   Currently, the program is simple in                                                               
that  AHFC  does  not  have  to  be  concerned  about  whether  a                                                               
homeowner has  sufficient assets  to cover his/her  obligation to                                                               
the  contractor.     The  fiscal   note  includes   employees  to                                                               
administer   this   program   while   minimally   affecting   the                                                               
corporation.   In further response  to Co-Chair Millett,  he said                                                               
there  are  six  full-time  employees and  some  temps  presently                                                               
administering the program.  AHFC  certifies the energy raters, so                                                               
all it has do is look at  the pre- and post-ratings and check for                                                               
receipts.                                                                                                                       
                                                                                                                                
4:22:55 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  MILLETT assumed  HB 278  would double  the size  of the                                                               
organization to help one-fifth of the applicants.                                                                               
                                                                                                                                
4:23:24 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER said  AHFC will not have statistics on  the number of                                                               
homeowners who need this program until summer.                                                                                  
                                                                                                                                
4:23:37 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON based  his support of the bill on  the merits and                                                               
on AHFC's stance.  He asked whether AHFC supports the bill.                                                                     
                                                                                                                                
4:24:32 PM                                                                                                                    
                                                                                                                                
MR.  BUTCHER said  AHFC is  neutral on  the bill.   He  said AHFC                                                               
agrees with  the idea  of the  bill, and  will implement  it, but                                                               
does not have sufficient information  to recommend the passage of                                                               
the bill at this time.                                                                                                          
                                                                                                                                
4:25:15 PM                                                                                                                    
                                                                                                                                
CO-CHAIR   EDGMON  further   asked  about   the  need   for  more                                                               
information and time.   The questions that were  raised today are                                                               
not new to  AHFC; for example, this program has  come up short in                                                               
rural  areas,  and he  inquired  whether  AHFC has  analyzed  the                                                               
problems, or  the remedies  attempted by  the co-sponsors  of the                                                               
bill.   He encouraged a  close look  at the program,  although he                                                               
said this vehicle does not work.                                                                                                
                                                                                                                                
4:27:04 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER  re-stated AHFC's  concerns:  (1)  how to  define the                                                               
size of  the problem;  (2) how  to prevent  AHFC from  becoming a                                                               
bill collector.  He declined to give a definitive answer.                                                                       
                                                                                                                                
4:28:08 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON  assumed moving  the bill will  get ahead  of the                                                               
corporation's process.                                                                                                          
                                                                                                                                
4:28:25 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER agreed.                                                                                                             
                                                                                                                                
4:28:31 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PETERSEN pointed  out that  the number  of people                                                               
who do not  apply because they do  not have the money  to pay for                                                               
repairs, and  wait to be reimbursed,  is impossible to know.   He                                                               
gave his personal experience with  the program and questioned the                                                               
need for seven additional staff members.                                                                                        
                                                                                                                                
4:30:30 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER  explained that AHFC  believes if the  voucher system                                                               
is offered, the  majority of applicants will  choose that system.                                                               
He  described  energy  performance   contracting,  in  which  the                                                               
contractor  is   responsible  for   the  improvement   in  energy                                                               
efficiency,  and for  the improvement  work that  is done.   This                                                               
differs with the  home energy rebate program, in  which the rater                                                               
and the  contractor may  be two separate  businesses and  are not                                                               
"tied together."   His personal experience is that  the work done                                                               
may not be  of the highest level, thus AHFC  would be involved in                                                               
a lot of  paperwork regarding the difference  between the voucher                                                               
to the contractor, and the rebate to the homeowner.                                                                             
                                                                                                                                
4:32:52 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN  asked whether  AHFC is authorized  to do                                                               
this under its existing authority.                                                                                              
                                                                                                                                
MR. BUTCHER said  yes, and added that he hoped  AHFC will be able                                                               
to  make changes  for  the  benefit of  Alaskans  as the  program                                                               
progresses.                                                                                                                     
                                                                                                                                
4:33:31 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN  further asked  whether  the  idea of  a                                                               
voucher  system  had been  discussed  within  AHFC prior  to  the                                                               
introduction of HB 278.                                                                                                         
                                                                                                                                
MR. BUTCHER indicated  that AHFC is always  interested in helping                                                               
Alaskans, but must ensure there is no harm to the corporation.                                                                  
                                                                                                                                
4:34:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN inquired again  as to whether the voucher                                                               
system idea had been broached.                                                                                                  
                                                                                                                                
                                                                                                                                
MR. BUTCHER  advised that vouchers  were discussed for  the first                                                               
time with  Representative Tuck;  however, AHFC  was aware  of the                                                               
issue.                                                                                                                          
                                                                                                                                
4:35:41 PM                                                                                                                    
                                                                                                                                
CO-CHAIR EDGMON  recalled that AHFC  indicated it will  return to                                                               
the committee  with more data  and asked  when the data  could be                                                               
expected.                                                                                                                       
                                                                                                                                
                                                                                                                                
MR. BUTCHER indicated he was  unsure, but expected information in                                                               
April, 2010.                                                                                                                    
                                                                                                                                
4:37:14 PM                                                                                                                    
                                                                                                                                
MR. BUTCHER,  in further response  to Co-Chair  Edgmon, explained                                                               
that the  time limit on the  program was expanded from  12 months                                                               
to  18  months.    Most complaints  about  insufficient  time  to                                                               
complete   improvements  are   unfounded,  with   exceptions  for                                                               
applicants serving in the military,  or those with serious health                                                               
emergencies.    He acknowledged  that  as  more rural  applicants                                                               
approach the deadline,  the shortage of materials may  be more of                                                               
a factor, and AHFC is willing to consider extensions.                                                                           
                                                                                                                                
4:38:21 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  EDGMON further  recalled AHFC  officials will  consider                                                               
extensions to 24 months.                                                                                                        
                                                                                                                                
4:38:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE TUCK  pointed out  that the  amount of  the fiscal                                                               
note  attached to  the bill  was a  surprise to  the co-sponsors.                                                               
Initially, the  co-sponsors were told  to expect the  addition of                                                               
only one position.  He  opined that the additional positions were                                                               
added because  the program is  mistakenly identified as  a grant,                                                               
or loan, program.  Representative Tuck said:                                                                                    
                                                                                                                                
     There's not  going to be  any investigations  just like                                                                    
     there's no  investigations now taking place  for people                                                                    
     getting their rebate.... There  is potential fraud, but                                                                    
     ... I  think everything has been  running pretty smooth                                                                    
     and pretty  clean and ...  if there was fraud  going on                                                                    
     in the  program, who's  to say  that the  auditor isn't                                                                    
     misrepresenting the work that's being performed now?                                                                       
                                                                                                                                
REPRESENTATIVE  TUCK stressed  that there  is no  expectation for                                                               
AHFC  to become  a  bill collector;  in  fact, it  is  up to  the                                                               
contractor  to collect  from the  homeowner only.   He  clarified                                                               
that the  statute authorizes AHFC  to administer a  grant program                                                               
if it chooses.                                                                                                                  
                                                                                                                                
4:41:33 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT assumed  there is a limited  amount of liability                                                               
to AHFC if the contractor does not get paid.                                                                                    
                                                                                                                                
4:42:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  TUCK  pointed  out  that the  homeowner  makes  a                                                               
decision at  the time of  the pre-audit  whether to get  the work                                                               
done.                                                                                                                           
                                                                                                                                
4:42:27 PM                                                                                                                    
                                                                                                                                
MR.  BUTCHER,  regarding  the  fiscal  note,  said  that  "grants                                                               
administrator"  is  the  name  of the  positions  in  the  energy                                                               
department.   In  dealing with  potential fraud,  no less  that 5                                                               
percent of  the post-audits  are done by  a different  rater than                                                               
the pre-audit.  A few raters  have been removed, and he concluded                                                               
that Alaskans are protected from fraud in this way.                                                                             
                                                                                                                                
4:43:22 PM                                                                                                                    
                                                                                                                                
CO-CHAIR MILLETT expressed her intent  to hold HB 278 for further                                                               
testimony from AHFC.                                                                                                            
                                                                                                                                
REPRESENTATIVE TUCK  encouraged AHFC  to conduct  a poll  to find                                                               
out how many people do not  participate in the program because of                                                               
the conditions addressed in the bill.                                                                                           
                                                                                                                                
4:44:09 PM                                                                                                                    
                                                                                                                                

Document Name Date/Time Subjects
HB411-CED-AEA-3-2-10.pdf HENE 3/9/2010 3:00:00 PM
HENE 3/16/2010 3:00:00 PM
HB 411
HB411-CED-AIDEA-3-2-10.pdf HENE 3/9/2010 3:00:00 PM
HENE 3/16/2010 3:00:00 PM
HB 411
Sectional for HB 411 and SB 301.pdf HENE 3/9/2010 3:00:00 PM
HENE 3/16/2010 3:00:00 PM
HB 411
SB 301
2-17-2010_MOU_AIDEA_AEA.pdf HENE 3/9/2010 3:00:00 PM
FINAL House Transmittal Letter LL0974.pdf HENE 3/9/2010 3:00:00 PM
HB0411A.pdf HENE 3/9/2010 3:00:00 PM
HENE 3/16/2010 3:00:00 PM
HB 411
Energy Committee Agenda 03092010.pdf HENE 3/9/2010 3:00:00 PM
HB0278A.pdf HENE 3/9/2010 3:00:00 PM
HB 278
HB 278 Kawerak Letter.PDF HENE 3/9/2010 3:00:00 PM
HB 278
HB 278 Sectional.PDF HENE 3/9/2010 3:00:00 PM
HB 278
HB 278 Sponsor Statement.PDF HENE 3/9/2010 3:00:00 PM
HB 278
HB278-REV-AHFC-3-8-10 Energy Efficiency Loans.pdf HENE 3/9/2010 3:00:00 PM
HB 278
HB 278 Q&A.PDF HENE 3/9/2010 3:00:00 PM
HB 278
HB 278 letters of Support.PDF HENE 3/9/2010 3:00:00 PM
HB 278
MOU AEA-AIDEA HB 411.PDF HENE 3/9/2010 3:00:00 PM
HENE 3/16/2010 3:00:00 PM
HB 411
Sample Home Energy Voucher Language for HB 278.pdf HENE 3/9/2010 3:00:00 PM
HB 278
Tuck Energy Committtee Hearing Testimony 030910.pdf HENE 3/9/2010 3:00:00 PM