Legislature(2009 - 2010)

04/16/2009 05:11 PM House FIN

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CS FOR SENATE BILL NO. 75(FIN)                                                                                                
     "An Act making and amending appropriations, including                                                                      
     capital appropriations, supplemental appropriations,                                                                       
     and appropriations to capitalize funds; and providing                                                                      
     for an effective date."                                                                                                    
Co-Chair  Hawker  MOVED  to adopt  HCS  CSSB  75 (FIN)  as  a                                                                   
working  document  before  the   committee.  There  being  NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
8:14:42 PM                                                                                                                    
JAMES  ARMSTRONG,  STAFF,  CO-CHAIR  STOLTZE,  reported  that                                                                   
there  were  three additional  legislative  finance  reports;                                                                   
numbers and  language differences only, numbers  and language                                                                   
differences statewide,  and numbers and language  detailed by                                                                   
8:17:05 PM                                                                                                                    
Mr. Armstrong  listed the changes  to the bill. Page  2, Line                                                                   
13, adds the  appropriation mechanism of $2,500,000,  for the                                                                   
Enterprise Security Projects.                                                                                                   
Representative  Gara asked  for  clarification  on the  first                                                                   
change. Mr. Armstrong replied  that in the previous draft the                                                                   
Senate  added the funding  for the  Enterprise technology  in                                                                   
the  language section,  but  due to  a  technical error,  the                                                                   
actual funding  allocation mechanism  allowing the  agency to                                                                   
spend the money, was omitted.  The change adds that allowance                                                                   
language back in.                                                                                                               
Mr. Armstrong continued.  Page 2, Line 27, adds  $4.5 million                                                                   
in general funds  match to Alaska Energy  Authority-Renewable                                                                   
Energy  Projects.  It  also  adds  $1  million  in  Statutory                                                                   
Designated Program  Receipts and Inter Agency  Receipts. Page                                                                   
3,  Line  17,  adds  intent  language   to  the  $10  million                                                                   
appropriation to the Port of Anchorage.  The appropriation is                                                                   
contingent   upon  the  municipality   assembly  adopting   a                                                                   
resolution  identifying the specific  ferry landing  location                                                                   
for M/V Susitna.  Line 22, requests that the  Municipality of                                                                   
Anchorage  assist the  Mat-Su borough  in grant  applications                                                                   
for  port  projects  to  the   United  States  Department  of                                                                   
8:18:23 PM                                                                                                                    
Representative Gara  wondered where the corresponding  change                                                                   
could be  found in  the numbers and  language section  of the                                                                   
bill. Mr. Armstrong replied that  the language had been added                                                                   
to the  general fund portion  of the ports appropriation.  He                                                                   
added that he would point out  intent language in the bill as                                                                   
it came up.                                                                                                                     
8:19:11 PM                                                                                                                    
Mr. Armstrong  continued to  Line 27,  the Kenai River  Bluff                                                                   
Project. The project was not in  the original bill. The Corps                                                                   
of  Engineers has  $13 million  slated for  the project.  The                                                                   
Kenai borough has added $2 million  to the project, which the                                                                   
state has  matched. Language has  been added to  specify that                                                                   
the appropriation is contingent  upon the fund from the Corps                                                                   
of Engineers.  Mr. Armstrong  noted that  the bonds  had been                                                                   
approved,  but  not  issued,   in  anticipation  of  the  $13                                                                   
Vice-Chair  Thomas asked  when an  answer from  the Corps  of                                                                   
Engineers  could be expected.   Mr.  Armstrong said  that the                                                                   
corps was still in deliberation.                                                                                                
Co-Chair  Stoltze  pointed  out  that the  project  had  been                                                                   
introduced by the administration.                                                                                               
8:20:06 PM                                                                                                                    
Mr. Armstrong  continued to Page  19, Line 19, which  adds 40                                                                   
percent  of  the  deferred  maintenance  funds  requested  by                                                                   
Alaska  Housing  Finance  Corporation  (AHFC)  for  the  AHFC                                                                   
Building System  Replacement Program. Page 19,  Line 33, adds                                                                   
$1,380,000 to  AHFC Fire Protection Systems,  also 40 percent                                                                   
of  the  deferred  maintenance   receipts  requested  by  the                                                                   
8:21:03 PM                                                                                                                    
Mr. Armstrong  explained  that AHFC had  bonded for  deferred                                                                   
maintenance  receipts in the  past. The  bonding has  run out                                                                   
and regular program receipts are now being requested.                                                                           
Representative  Kelly asked  if the  administration had  made                                                                   
the  request on  behalf  of  the corporation.  Mr.  Armstrong                                                                   
replied that it had.                                                                                                            
8:21:59 PM                                                                                                                    
Mr. Armstrong continued  to page 20, Line 15.  He stated that                                                                   
$3.5 million  had been added to  the third phase of  the AHFC                                                                   
Loussac Manor  renovation and replacement in  Anchorage. Line                                                                   
18  notes  a  third of  the  deferred  maintenance  for  AHFC                                                                   
Security  Systems  Replacement/Upgrades for  public  housing.                                                                   
Congress  has  given  AHFC $600,000  for  the  Weatherization                                                                   
Program, as noted on Page 20, Line 32.                                                                                          
8:22:45 PM                                                                                                                    
Mr. Armstrong  informed the committee  that $400,000  for the                                                                   
Alaska Aviation  Safety Program  had been  added on  Page 21,                                                                   
Line  10.  Those  funds  have been  matched  by  the  Federal                                                                   
Aviation Administration and The Medallion Foundation.                                                                           
8:23:22 PM                                                                                                                    
Mr.  Armstrong relayed  that Page  21,  Lines 20,  21 and  22                                                                   
notes  the  administrative  intent language  for  the  Alaska                                                                   
Marine Highway System. Page 21,  Line 31 notes the 60 percent                                                                   
of  the  funding  for  the  Harbor  Program  Development  was                                                                   
restored at the  request of the administration.  This project                                                                   
had  been  overlooked, but  will  be  moved  in 2010  to  the                                                                   
operating budget.                                                                                                               
Representative  Foster  pointed  out  that in  the  past  the                                                                   
administration  had vetoed  capital  projects. Mr.  Armstrong                                                                   
assumed  that  the  administration  would not  veto  its  own                                                                   
8:24:50 PM                                                                                                                    
Representative Gara  asked if all the changes  mentioned were                                                                   
governor's requests.   Mr. Armstrong reported  that after the                                                                   
Senate version  of the bill  had passed, projects  that could                                                                   
capture a  match had  been identified. He  said that  some of                                                                   
the  matches   would  not  flow  through   the  appropriation                                                                   
process. Co-Chair  Stoltze added that a list  of projects had                                                                   
been  presented that  had match  funds,  but through  errors,                                                                   
some projects had not made the list.                                                                                            
Representative  Gara restated  his question.   Mr.  Armstrong                                                                   
explained  that  the  back-up  had been  reviewed  twice.  He                                                                   
elaborated  that  some  of the  back-up  did  not  illustrate                                                                   
whether  there  had  been  an   accompanying  federal  match.                                                                   
Representative  Gara  asked if  the  items  had been  in  the                                                                   
governor's original budget.                                                                                                     
 8:26:57 PM                                                                                                                   
Mr. Armstrong pointed out that  Page 34, Line 14 and Page 36,                                                                   
Line  9,  were  both  oversights  in  the  amendment  process                                                                   
between   the    Department   of   Transportation    stimulus                                                                   
legislation  and  the  original   capital  budget.  The  line                                                                   
changes  restore  funding  for  FY 2009  projects  that  were                                                                   
already on the STIP in the original capital budget.                                                                             
8:28:22 PM                                                                                                                    
Mr. Armstrong  turned  to Section  4, Page  44, Line 10.  The                                                                   
title  for  the  appropriation  has been  changed  from  Egan                                                                   
Center Upgrades to Passenger Staging Upgrades.                                                                                  
Representative   Gara    returned   to   the    Egan   Center                                                                   
appropriation.   He  wondered if  the money  would come  from                                                                   
cruise ship funds.  Mr. Armstrong  said yes. All of Section 4                                                                   
pertains to cruise ship funds.                                                                                                  
Mr. Armstrong continued reading  from the bill. Page 45, Line                                                                   
9 is  related to the  Baranof Park  Project in Kodiak,  which                                                                   
was  in the  original  CS  from the  senate,  and  was not  a                                                                   
qualifying  project.  Another  project  is  slated  for  $1.3                                                                   
million, making the addition a net zero addition.                                                                               
8:30:54 PM                                                                                                                    
Mr. Armstrong  continued to Page  45, Lines 19 and  20, which                                                                   
are a  title change. The  words "and Construction"  have been                                                                   
added.  Page  46, Line  22,  title  change inserts  the  work                                                                   
"passenger"  between "marine"  and "service".  Page 46,  Line                                                                   
29, is  the Fort  Abercrombie Tourist  Bus Parking,  which is                                                                   
the $1.3  million project  previously  mentioned. If  you add                                                                   
the appropriation  on Page 45, Line  9 to Page, 46,  Line 29,                                                                   
and take  out the Baranof Park  Project, the addition  is net                                                                   
8:32:46 PM                                                                                                                    
Mr. Armstrong informed  the committee that the  $6 million in                                                                   
allocations from  the original bill  sent by the  Senate have                                                                   
been collapsed  into one  separate appropriation,  and intent                                                                   
language has been added to the top of page 47.                                                                                  
Vice-Chair  Thomas wondered  how  the numbers  of people  who                                                                   
utilize parks  were accounted for. Mr. Armstrong  deferred to                                                                   
the administration.                                                                                                             
8:33:39 PM                                                                                                                    
Representative  Crawford asked about  the funding  source for                                                                   
line  32,  page  46, State  Parks  Deferred  Maintenance  and                                                                   
Emergency.  Mr.  Armstrong related  that  when  the bill  was                                                                   
first released by the governor,  projects in the section were                                                                   
to  be funded,  within  the  fast track  supplemental,  using                                                                   
cruise ship  gambling proceeds. However,  the administration,                                                                   
upon consultation  with the legislature, decided  to classify                                                                   
the gambling funds as general  funds. As a result, $6 million                                                                   
of the cruise  ship head tax dollars have been  allocated for                                                                   
statewide deferred maintenance projects.                                                                                        
8:34:44 PM                                                                                                                    
Co-Chair  Hawker  clarified  that   the  head  tax  has  very                                                                   
specific legal  requirements as to  how it can be  spent. The                                                                   
Office  of Management  and  Budget (OMB)  and  the state  had                                                                   
originally thought of the gambling  tax as a new and separate                                                                   
fund  source. Upon  reflection,  it was  understood that  the                                                                   
gambling tax was  just like all other taxes and  was meant to                                                                   
feed the general  fund. He made clear that where  the tax was                                                                   
indicated  on earlier spreadsheets  was to  be treated  as an                                                                   
anachronism,  and will  always  be treated  as general  funds                                                                   
going forward.                                                                                                                  
8:35:42 PM                                                                                                                    
Mr. Armstrong  continued to read  from the bill. On  Page 53,                                                                   
Lines 15  and 17, corrections  have been made to  rectify the                                                                   
incorrect House  District numbers.  Page 63, Lines  1 through                                                                   
28, are intent  language that covers an appropriation  in the                                                                   
language  section.  Co-Chair  Stoltze  recommended  deferring                                                                   
those line budget  items to Co-Chair Hawker at  a later time.                                                                   
Mr. Armstrong continued to Page 67, Line 23.                                                                                    
8:37:13 PM                                                                                                                    
Co-Chair  Hawker reported  that there  are three sections  in                                                                   
the   bill   that  could   arguably   be   called   operating                                                                   
appropriation  for the  year. The sections  are; Section  21,                                                                   
Page 67, Section 20, Page 67,  and associated intent language                                                                   
on  Page  63.  There  has  been  ongoing  discussion  in  the                                                                   
legislature  concerning  state  investment  in  in-state  gas                                                                   
development, while  attempting to reconcile development  of a                                                                   
gas line  with high  fuel costs.  Section 20 appropriated  an                                                                   
additional general fund appropriation  into the Department of                                                                   
Health and  Social Services (DHSS)  to continue to  build the                                                                   
Low Income Home Energy Assistance  Program fund (LIHEAP). The                                                                   
funds augment the federal Alaska  Heating Assistance Program.                                                                   
8:39:17 PM                                                                                                                    
Co-Chair  Hawker   stressed  that  money  for   in-state  gas                                                                   
development was the top budgetary  priority for the governor.                                                                   
He gave that $9  million in general funds have  been added to                                                                   
Office  of the  Governor for  gasline development.   He  read                                                                   
from the legislative intent language  in Section 13, Page 63,                                                                   
Lines 3-6. He  emphasized that the project is  not related to                                                                   
Alaska  Gasline Inducement  Act  (AGIA), but  to continue  to                                                                   
work to  develop in-state gas  for in-state use. It  is meant                                                                   
expedite  the  efforts  needed   for  private  enterprise  to                                                                   
complete  the  project. The  money  was appropriated  to  the                                                                   
Office of  the Governor to  ensure the governor  the latitude                                                                   
to distribute the funds where she deemed most appropriate.                                                                      
8:42:11 PM                                                                                                                    
Representative Crawford inquired  the funds could be used for                                                                   
the  Alaska Natural  Gas Development  Authority (ANGDA).  Co-                                                                   
Chair Hawker reported that it could be used for ANGDA.                                                                          
Representative Kelly understood  that the funds could be used                                                                   
at the  governor's discretion.  Co-Chair Hawker clarified  it                                                                   
the intent  to make  the money available  to the  governor to                                                                   
utilize, within parameters, as she deemed fit.                                                                                  
8:43:44 PM                                                                                                                    
Representative  Gara asked  how the  decision to  appropriate                                                                   
the $9  million was made.  Co-Chair Hawker reported  that the                                                                   
governor   had    requested   $9.3   million.    The   LIHEAP                                                                   
appropriation  was already benchmarked  at $9 million,  which                                                                   
aided in the decision. Representative  Gara wondered when the                                                                   
discussion  on  the amount  of  the appropriation  had  taken                                                                   
place.  Co-Chair Hawker  believed  the discussion  had  taken                                                                   
place within  the sphere  of the administrations  specialized                                                                   
knowledge. Representative Gara  requested discussion from the                                                                   
administration  as to  what the  state would  receive for  $9                                                                   
million, and why that specific amount was requested.                                                                            
8:45:05 PM                                                                                                                    
Representative  Gara voiced  concern  about  the language  on                                                                   
page 63, Line  15. He felt it would allow  the administration                                                                   
to spend  state money as a  subsidy to a private  entity. Co-                                                                   
Chair Hawker  explained that  intent is  to provide  funds to                                                                   
facilitate progress on in-state gas development.                                                                                
8:46:40 PM                                                                                                                    
Representative   Gara  hoped   that  there   would  be   more                                                                   
discussion on  the matter. Co-Chair  Hawker pointed  out that                                                                   
every year funds  are added to departments in  the pursuit of                                                                   
in-state gas  development, regardless of progress.  He termed                                                                   
it  a policy  call.  Co-Chair  Stoltze added  that  it was  a                                                                   
pronounced request from the administration.                                                                                     
Co-Chair Hawker  pointed out that  there are laws  to prevent                                                                   
the administration from giving away assets.                                                                                     
8:47:57 PM                                                                                                                    
Vice-Chair  Thomas  requested  an audit  of  ANGDA.  Co-Chair                                                                   
Hawker replied  that that was  possible. He recommended  that                                                                   
the request  be directed to  Legislative Budget  and Auditing                                                                   
(LB&A).  Vice-Chair  Thomas suggested that the  audit be done                                                                   
before the  money is  given to  ANGDA. Co-Chair Hawker  noted                                                                   
the funding  is provided directly  to the governor's  office.                                                                   
In recognition of the concerns  about ANGDA, he reported that                                                                   
the funds under discussion are  entrusted specifically to the                                                                   
governor.  He thought  the governor's  office  would use  the                                                                   
money wisely.                                                                                                                   
8:50:06 PM                                                                                                                    
Representative  Gara felt that  the appropriation was  a huge                                                                   
policy call,  with no  limitations, and unenforceable  intent                                                                   
language.  He thought it  should be  reconsidered in  an open                                                                   
committee process. He strongly questioned its transparency.                                                                     
Co-Chair Hawker understood that  the governor had stated that                                                                   
the intent for the $9 million  was that it be invested in in-                                                                   
state gas development.                                                                                                          
8:51:32 PM                                                                                                                    
KAREN  REHFELD, DIRECTOR,  OFFICE OF  MANAGEMENT AND  BUDGET,                                                                   
OFFICE  OF THE  GOVERNOR, informed  the  committee that  this                                                                   
item  has been  a  priority for  the  governor  and has  been                                                                   
discussed in various committees.                                                                                                
LARRY PERSILY,  STAFF, CO-CHAIR HAWKER, explained  that Harry                                                                   
Noah, an executive  branch employee, has been  designated the                                                                   
governor's  in-state  gas  line   coordinator  and  has  been                                                                   
discussing the  issue with as  many legislators  as possible.                                                                   
He has presented  suggestions as to the best  way an in-state                                                                   
gasline could  be developed; discussing timelines,  necessary                                                                   
funds and the right of way permits that would be required.                                                                      
Representative Gara  wondered which legislators  Mr. Noah had                                                                   
spoken to.  He understood that  the governor presented  bills                                                                   
to the  legislature, and that  those bills had  parameters as                                                                   
to  how the  money would  be spent.  He  maintained that  the                                                                   
bills had not  passed. He voiced concern that  the $9 million                                                                   
was just an  award to the governor's office.  He alleged that                                                                   
full disclosure for  use of the funds had not  been discussed                                                                   
with  the entire  committee before  the  intent language  was                                                                   
written into the bill.                                                                                                          
Ms. Rehfeld  reported  that Mr.  Noah has spent  time in  the                                                                   
building  talking  to  lawmakers, and  those  lawmakers  have                                                                   
confidence  in the design  and detail  that was presented  to                                                                   
them.  Co-Chair  Hawker  added   that  there  had  been  many                                                                   
discussions on the issue.                                                                                                       
8:55:54 PM                                                                                                                    
Representative  Austerman  reported that  the  administration                                                                   
had not  sent a representative  to his office to  discuss the                                                                   
issue.  He  expressed regret  that  he  had not  been  better                                                                   
Co-Chair  Stoltze recalled  that Mr.  Noah had contacted  his                                                                   
office to discuss the issue.                                                                                                    
Co-Chair  Hawker   communicated  his  frustration   with  the                                                                   
governor's current  lack of connection with  the legislature.                                                                   
He  felt that  she  gave the  appearance  that  she was  more                                                                   
concerned  with her  national  ambitions than  with what  was                                                                   
transpiring  in her  home  state. He  expounded  that it  was                                                                   
insulting, personally,  and to the people of  the state, that                                                                   
the  administration  had  not  followed  up  with  leadership                                                                   
throughout the building on the issue.                                                                                           
Vice-Chair  Thomas stated  for  the record  that  no one  had                                                                   
contacted him.                                                                                                                  
JOE  BALASH, INTER-GOVERNMENTAL  COORDINATOR,  DEPARTMENT  OF                                                                   
NATURAL  RESOURCES,  reported that  the  work  plan had  been                                                                   
presented  in a public  manner in  the governor's  conference                                                                   
room, as well as broadcast on  Gavel to Gavel in early March.                                                                   
Since that  time, Mr. Noah has  held several meetings  with a                                                                   
legislative working group, coordinated  through the presiding                                                                   
officers in  both bodies. Various documents  were distributed                                                                   
at  the meetings,  which  detailed  the  work plan  by  date,                                                                   
schedule, activity, and approximate  budget for each step. He                                                                   
offered to provide copies of the documents at a later date.                                                                     
8:59:13 PM                                                                                                                    
Representative  Gara emphasized  that while working  together                                                                   
to make  the gasline  a reality,  it was  important that  the                                                                   
administration keep the committee  informed. He revealed that                                                                   
he had not  heard of the legislative working  group mentioned                                                                   
by Mr.  Balash. He  wondered if  the group  had a title.  Mr.                                                                   
Balash replied  it had  been labeled  the "working  group" at                                                                   
administrative  meetings. He recalled  that, at the  meetings                                                                   
he   participated    in,   there    had   been    legislative                                                                   
representatives  present. He  said  that he  could provide  a                                                                   
list of those present.                                                                                                          
Representative  Gara requested  written documentation  of the                                                                   
administration's  plan for  the funds,  and for a  commitment                                                                   
that the  funds would  be spent  according  to the plan.  Mr.                                                                   
Balash related  that meetings  on the  issue had occurred  in                                                                   
early March.  At that point, Mr.  Noah was introduced  by the                                                                   
governor as her  project director. A three  part approach was                                                                   
then laid  out; funding had  been identified,  legislation on                                                                   
right  of way  and  pipeline acts  had  been introduced,  and                                                                   
legislation broadening the purpose  of the Alaska Natural Gas                                                                   
Authority.  He  believed  that the  administration  had  been                                                                   
responsive to points of inquiry.                                                                                                
9:02:05 PM                                                                                                                    
Representative Gara  stated that he had seen Mr.  Noah in the                                                                   
building,  but had  not  spoken to  him.  He maintained  that                                                                   
there  has   not  been   deliberative  discussion   with  all                                                                   
legislators regarding the plan.                                                                                                 
Representative   Austerman   stated   it  would   have   been                                                                   
appropriate  for a  representative of  the administration  to                                                                   
have briefed committee members on Section 13 of the bill.                                                                       
9:03:41 PM                                                                                                                    
Co-Chair  Hawker  related  that  the bill  is  a  legislative                                                                   
budget. The  administration did  not know this  section would                                                                   
be included. The  issue has been in discussion  among the Co-                                                                   
Chairs   of  both   House   and   Senate  Finance   and   the                                                                   
administration. Ultimately,  the governor's  desire prevailed                                                                   
and  the request  was included  in the  budget. He  clarified                                                                   
that the addition  of Section 13 was made by  the legislature                                                                   
and  not  Mr.  Balash.  Representative   Austerman  expressed                                                                   
frustration  that  the issue  had  not  come up  in  minority                                                                   
caucus  meetings. Co-Chair  Hawker argued  that he would  not                                                                   
discuss caucus matters on the  table. He voiced his amazement                                                                   
with  the administration's  lack  of communication  with  the                                                                   
other members of the committee.                                                                                                 
9:05:50 PM                                                                                                                    
Ms. Rehfeld communicated that  the administration has had the                                                                   
appropriation in  its budget since  December 2008.  A request                                                                   
for  $5  million  was  put  in   specifically  for  ANGDA  in                                                                   
December. It was then increased  to $8 million in the amended                                                                   
budget. She  felt that as the  approach to the  plan evolved,                                                                   
the administration  had maintained  clear communication  with                                                                   
the  committee.   She  added  that  the  governor   has  been                                                                   
consistent in her dialogue on in-state gas.                                                                                     
Representative Kelly pointed out  that Mr. Noah had spoken to                                                                   
him about  the project.  He confirmed  that  he has also  had                                                                   
discussions with Ms. Rehfeld about  the request for ANGDA and                                                                   
was familiar with the section.                                                                                                  
9:07:58 PM                                                                                                                    
Representative Gara remarked that  the earlier request for $5                                                                   
million for  ANGDA, to  follow a  statutory purpose,  had not                                                                   
caused him  alarm. He  emphasized that  the change  grants $9                                                                   
million  to  the  governor to  spend  without  a  statutorily                                                                   
authorized purpose.                                                                                                             
9:09:17 PM                                                                                                                    
Mr. Balash explained the work  plan entails, as a first step,                                                                   
an   alternatives   analysis   to  identify   the   cost   of                                                                   
transportation and  the various routes. In  June, information                                                                   
would be gathered  for applying for major  permits, including                                                                   
rights of way.   In parallel, the deliverability  and reserve                                                                   
life  in  Cook  Inlet  would be  evaluated.    Ways  to  make                                                                   
reserves  last   longer  and  the  possibility   of  stop-gap                                                                   
importation,  in order to  bridge any  gap until natural  gas                                                                   
can  be delivered,  will also  be examined.  More funds  will                                                                   
likely be  requested in 2010  as the customers  and potential                                                                   
suppliers  of gas  are identified.  The goal  is to  be in  a                                                                   
position by  2011; to  take the  collection of major  permits                                                                   
and regulatory  approvals, and  the identified suppliers  and                                                                   
customers, and  present the information  to a  private party,                                                                   
who will than  construct the gasline. In return,  the private                                                                   
party would  reimburse the  state for  the costs incurred  by                                                                   
the  state  for   the  package  of  permits   and  regulatory                                                                   
9:12:56 PM                                                                                                                    
Representative Austerman  pointed out that the  change in the                                                                   
budget  would  need to  be  reviewed  by the  Senate  Finance                                                                   
Committee. He wondered  if the section had been  discussed in                                                                   
that body.                                                                                                                      
Co-Chair  Stoltze thought  that the  Senate leadership  would                                                                   
embrace the idea in order to move forward on in-state gas.                                                                      
Representative Crawford expressed  concern with the switch in                                                                   
priority from ANGDA based spur line to ENSTAR bullet line.                                                                      
9:14:05 PM                                                                                                                    
Mr.  Persily pointed  out that  ANGDA's  operating budget  is                                                                   
still funded  from previous  appropriations and can  continue                                                                   
to  operate fully.    He shared  his understanding  that  the                                                                   
additional  funding was  to ensure,  should gas  availability                                                                   
become scarce,  that the state  will have access  to in-state                                                                   
Co-Chair Stoltze  suggested Mr. Balash talk  to any committee                                                                   
members he may  have missed in his first round  of meeting on                                                                   
the issue.                                                                                                                      
Representative  Gara  requested binding  representation  that                                                                   
legislative approval  would be required for  any project from                                                                   
the governor's office concerning the issue.                                                                                     
Mr.  Balash  asked  for  clarification  as to  what  kind  of                                                                   
representation  would be satisfactory.   Representative  Gara                                                                   
suggested  a letter  from governor  ensuring  that the  state                                                                   
would  get full  value for  work  done on  the project,  upon                                                                   
approval of  legislature.  Mr.  Balash agreed to do  that. He                                                                   
perceived that a pipeline would  not be built for $9 million.                                                                   
Co-Chair  Hawker  related  that   the  legislature  has  sole                                                                   
appropriation power.                                                                                                            
9:17:37 PM                                                                                                                    
Representative Foster stated that  he had not been invited to                                                                   
the  meetings on  the subject.  He remarked  that many  House                                                                   
members are tied up in committee  during the day. He felt and                                                                   
that the best way to be sure each  member has the appropriate                                                                   
information on a  bill was for department heads  to go office                                                                   
to office.  He felt  that the committee  had been  caught off                                                                   
guard by the section.                                                                                                           
9:18:40 PM                                                                                                                    
Representative Kelly  felt that the intent language  could be                                                                   
more specific.                                                                                                                  
9:19:49 PM                                                                                                                    
Mr. Armstrong  returned  to explaining  changes in the  bill.                                                                   
On Page 79, Line  6 to Page 80, Line 17 there  are structural                                                                   
changes   to    the   legislature's   lapsing    funds.   The                                                                   
reappropriations  are  for  legislative   audit,  legislative                                                                   
council  and the  legislative  operating budget.  Limitations                                                                   
were placed  in Section C,  Line 24, appropriations  for 50th                                                                   
statehood;  display  of  historical  art  and  artifacts.  An                                                                   
appropriation  for statewide  energy plans  were removed  and                                                                   
put into Section  D, which begins  on Line 29 of Page  79. He                                                                   
said  that the  bill matches  the Senate  version except  the                                                                   
Senate had  some funds  going to  LBA that  are now  going to                                                                   
Legislative Council.                                                                                                            
9:21:48 PM                                                                                                                    
Representative Foster commented  on Lines 26 and 27 regarding                                                                   
Legislative Council.  He wondered if it would  be possible to                                                                   
make  the work  of  Legislative  Council more  accessible  to                                                                   
communities  outside  of  Juneau.   Mr.  Armstrong  suggested                                                                   
bringing  it to  the  attention  of the  Legislative  Council                                                                   
chair when they next meet.                                                                                                      
Vice-Chair Thomas  asked about a statewide energy  plan.  Mr.                                                                   
Armstrong said  that in the version  of the bill sent  out by                                                                   
the  other body,  there had  been  $300,000 lined  out for  a                                                                   
statewide  comprehensive  energy  plan,  to be  conducted  by                                                                   
LB&A. The  plan was removed, and  the funds were  rolled back                                                                   
into section D  of the appropriation. Co-Chair  Stoltze added                                                                   
that  the item  is in  the legislative  branch  and open  for                                                                   
discussion.  Vice-Chair Thomas  stated that  he would  rather                                                                   
hire a  state employee  for the job,  rather than  an out-of-                                                                   
state consultant.                                                                                                               
9:23:54 PM                                                                                                                    
Representative Crawford  questioned the language  on page 80,                                                                   
Lines 2 and 3, "for necessary  legislative capital projects".                                                                   
Mr. Armstrong explained that Legislative  Council has control                                                                   
of  the building  operations during  the interim.   He  added                                                                   
that   it  must   be  an   agenda  item   to  expend   funds.                                                                   
Representative  Crawford asked for  an estimated  amount. Mr.                                                                   
Armstrong said $2 million.                                                                                                      
Representative  Gara thought  that  the reapproprations  from                                                                   
LB&A to  Legislative Council were  excessive.   Mr. Armstrong                                                                   
replied  that most  of the funds  had been  expended for  the                                                                   
projects listed in Section 40.                                                                                                  
9:27:17 PM                                                                                                                    
Mr. Armstrong continued to Page  81, Line 25, which lists the                                                                   
appropriation  set out  for federal stimulus  funds  for DHSS                                                                   
health  care  services,  for a  statewide  electronic  health                                                                   
information exchange system. The  contingent language on Page                                                                   
84,  Line 20,  states  that  SB 133  needs  to  pass for  the                                                                   
mechanism in Section 43 to be funded.                                                                                           
Mr. Armstrong  continued with the  final changes to  the bill                                                                   
in  Sections  22-39,  which correct  a  series  of  technical                                                                   
Mr. Armstrong  explained that  additional appropriations  had                                                                   
come in after the March 25, 2009  deadline, and were added to                                                                   
the bill.  He listed reappropriations by district.                                                                              
9:30:05 PM                                                                                                                    
Mr.  Armstrong noted  that the  change from  Senate to  House                                                                   
Finance funds is outlined on the  bottom right hand corner of                                                                   
Page 2 of the Legislative Finance report.                                                                                       
9:31:05 PM                                                                                                                    
Representative   Salmon  asked   for  clarification   on  the                                                                   
appropriation amount listed on Page 67, Lines 5 to 11.                                                                          
JOHN BITNEY, STAFF,  SPEAKER JOHN HARRIS, explained  that the                                                                   
reappropriation  request  for  that  district.  The  original                                                                   
appropriation to  the city of Delta Junction  of $1.2 million                                                                   
was  to pay  a  litigation settlement  in  a  lawsuit with  a                                                                   
private prison developer. Per  the appropriation in 2000, the                                                                   
city was required  to pay 50,000 each year out  of the city's                                                                   
revenue sharing.  Currently there is an unpaid  balance of $1                                                                   
million  on the  loan. The  original  language contained  the                                                                   
contingency that the loan would  be forgiven if the community                                                                   
incorporated  as  a borough.  The  new language  removes  the                                                                   
9:34:33 PM                                                                                                                    
Representative  Kelly asked  if the  language on  Line 28  on                                                                   
Page 67,  extends the  LIHEAP general  fund increase  for two                                                                   
more years.  Co-Chair  Hawker replied that it is  a single $9                                                                   
million  appropriation to  DHSSto be  spent between  June 30,                                                                   
2009 and  June 30, 2010.   Representative Kelly asked  it was                                                                   
in addition to funds given during  the 2008 session. Co-Chair                                                                   
Hawker replied yes.                                                                                                             
9:35:59 PM                                                                                                                    
Mr.  Armstrong   reported  that  the  Constitutional   Budget                                                                   
Reserve management  fees had been  removed from the  bill and                                                                   
could be found in the operating budget.                                                                                         
Representative Gara  asked if all  projects in the  bill were                                                                   
reinstatements  of the  governor's requests.   Mr.  Armstrong                                                                   
said that was correct, except for the cruise ship items.                                                                        
Representative  Gara  wondered about  Page  63  of the  bill,                                                                   
which  details  legislative  intent  on gas  line  money.  He                                                                   
understood that  the funds could  be used only for  a private                                                                   
sector project and  that the project would go  from The North                                                                   
Slope  to  Fairbanks and  down  to  the Kenai  Peninsula.  He                                                                   
remarked that the project sounded like the ENSTAR project.                                                                      
Co-Chair  Hawker disagreed.  He contended  that this  was the                                                                   
generic  investigation  of  a   bullet  line  and  that  many                                                                   
companies have  discussed the  possibility of involvement  in                                                                   
the project.  He said  the funds  were to facilitate  private                                                                   
sector construction,  ownership and management,  and that all                                                                   
interested in the project are welcome into the discussion.                                                                      
Representative Gara  relayed that he was not  interested in a                                                                   
project headed by ENSTAR.                                                                                                       
9:39:12 PM                                                                                                                    
Representative Fairclough  shared that ENSTAR  had not talked                                                                   
to her office.                                                                                                                  
Mr. Armstrong said that the legislative  finance reports will                                                                   
not  show  $9  million  as  those  are  considered  operating                                                                   
CSSB 75  (FIN) was  heard and HELD  in Committee  for further                                                                   

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