Legislature(1999 - 2000)
05/06/1999 09:15 AM FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
SENATE BILL NO. 157 "An Act relating to power cost equalization; and providing for an effective date." MARY JACKSON, staff to Senator John Torgerson was invited to join the committee. She explained CSSB 157(FIN), version "I" work draft for the committee. She further briefly outlined the sectional analysis, sections 1, 2, 3 and 4. She explained the difference between the two bills. The committee substitute does not make any differential to kilowatt hours of the original bill and statute; did not add Kenai and Palmer to Statewide average; deleted commercial users; did not lower PCE utility rates; raised the floor from 9.5 to 17.0 cents and added fuel efficiency notice requirements. Senator Adams said that one of the greatest impacts was on page two, section two, line nine. He said it would increase the electrical power equity. An individual would only receive $93/month. He thought they were going for a floor between 9.5 to 10. Ms. Jackson explained that the question of where to apply this floor was to ascertain which user would be hurt the least. Senator Green asked about the fuel efficiency notice requirements. Ms. Jackson said there were two APUC and the Division of Energy who were the "watchdogs" for the efficiency notice requirements. She said they work with each utility. Members of the division were present to answer any questions. Senator Wilken asked about the spreadsheet and who provided it. Ms. Jackson said that the department had provided it and they were present to answer any questions. Senator Green asked if there was any calculation on the impact to schools? Ms. Jackson said that a specific run was not made on this matter, however, Senator Torgerson had written a letter to the department regarding this matter. They advised that if there was a problem with a particular school they would consider a waiver. Senator Adams said that different schools depending on their location would have different costs and they would be asking for a waiver perhaps. He asked if there were any runs available on the difference between 9.5 and 17.0. Ms. Jackson indicated that it was in the spreadsheet provided by the division. Senator Adams commented regarding the PCE issue. "The public needs to know what direction we are going in if these changes are going to be made." Co-chair Torgerson referred to line fifteen of the spreadsheet. Ms. Jackson explained that figure was correct. Senator Parnell MOVED CSSB 157 (FIN) "I" to be ADOPTED. Senator Donley explained that he did not want to see this bill moved out today. Co-chair Torgerson said he wanted to move the bill out today. Senator Donley explained that he had drafted amendments but they were to the old version of the bill. He therefore, OBJECTED. By a roll call vote of 6 yeas (Torgerson, Parnell, Leman, Wilken, Green, Phillips) and 2 nays (Donley, Adams)(P. Kelly absent) CSSB 157(FIN) "I" was ADOPTED as the working draft before the committee. Co-chair Torgerson asked that copies of the work draft be provided the public. The committee took a brief at ease at approximately 9:30 a.m. Co-chair Torgerson reconvened the committee at approximately 9:40 a.m. LAMAR COTTEN, Deputy Commissioner, Department of Community and Regional Affairs was invited to join the committee. He voiced concern for the small communities regarding these cuts. He noted they have appreciated working with the Co- chair's staff regarding this issue. There are approximately 175 communities receiving assistance under this program, but they were not aware of how many individuals directly were receiving this assistance. They have made some suggestions regarding increasing the revenue from the Four Dam Pool program. Co-chair Torgerson further referred to the floor being kept at 700 kWh. Mr. Cotten explained. They have looked at different models to reduce the kilowatt-hours to 350. JOSEPH KOLLAR, Executive Secretary, Office of the Commissioner, Department of Community and Regional Affairs was invited to join the committee. He concurred with the comments made by Mr. Cotten. Senator Wilken asked Mr. Cotten explain the spreadsheet. Mr. Kollar walked the committee through the spreadsheet. Less than half of the kilowatt-hours sold in a community go to commercial users. Column thirteen was total kilowatt hours consumed. Column fourteen was kilowatt-hours acceptable to PCE. Senator Wilken asked about column nine and how it was derived. Mr. Kollar said it was set by PCE. He continued explaining the columns for the committee. He explained Pelican dropping off the program. He explained the communities with low usage rates are on page one of the spreadsheet and those with high usage rates are on page five of the spreadsheet. Communities with a high usage rate stood to lose more than those communities with a low usage rate. In conclusion he explained the "totals" on page five. Senator Leman asked about page five of the spreadsheet. He suggested perhaps the "ceiling" should be adjusted as well as the "floor". Co-chair Torgerson asked if a run had been made and Mr. Kollar indicated they had compared what the average payment would be. He would be willing to provide those comparisons to the committee. (pause on record) Mr. Kollar explained another comparison for an example for the committee in response to the request from Senator Leman. He said, however, he did not have a "neat" summary to present on paper at this time to the committee. Co-chair Torgerson asked that runs be provided to the committee by this afternoon. Mr. Kollar said that was possible. Senator Phillips asked about page one of the spreadsheet. He would appreciate an average also be provided. Senator Adams comments regarding commercial payments. Mr. Kollar responded. Commercial as indicated was private commercial and also included some non-profits. He will look into which non-profits and what commercial and communities. Senator Adams said he felt this was a very important matter and Co-chair Torgerson concurred. There followed a brief discussion between Senator Adams and Mr. Cotten regarding AIDEA involvement. Mr. Cotten said that Randy Simmons from AIDEA was on line to answer any questions. Co-chair Torgerson asked the department to have the requested information from Senators Adams and Leman by this afternoon in his office. (Tape # 126, Side A switched to Side B at log #589.) Senator Leman explained again his request to the department. Senator Adams also had brief comments and suggested perhaps another source could be looked for to fund revenue. Co-chair Torgerson concurred. He said they would work with Senator Adams to try and sort out this issue. Co-chair Torgerson HELD the bill in committee and said he would bring it up again as soon as possible. He then moved to teleconference and asked if anyone wanted to testify. Senator Adams said that in looking for revenue sources was there anything available for appropriation from AIDEA? RANDY SIMMONS, Executive Director, AIDEA, Department of Commerce and Economic Development responded via teleconference from Anchorage. He said there was approximately $8 million that could be made available. In response to a question from Co-chair Torgerson he said they were looking at the possibility of higher dividend payments to the State. They do anticipate higher dividends but do not know the amount. He would not, however, assume the amount could be lowered by the amount the Governor was putting in the fund regarding PCE for next year. They were looking at offering up more money for the year 2000. Co- chair Torgerson said there was only thirteen days left. Mr. Simmons indicated he was aware of this. ERIC YOULD, Executive Director for ARECA was invited to join the committee. He voiced his concern with this bill. Co-chair Torgerson assured they would continue working with him also. Co-chair Torgerson SET ASIDE CSSB 157(FIN) "I". He then called SB 97.