Legislature(2015 - 2016)BUTROVICH 205
03/20/2015 03:30 PM Senate RESOURCES
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HJR 4-OFFSHORE OIL & GAS REVENUE SHARING 4:19:43 PM CHAIR GIESSEL announced HJR 4 to be up for consideration. SENATOR COGHILL moved to adopt Amendment 1, 29-LS0281\A.2. 29-LS0281\A.2 Nauman 3/20/15 AMENDMENT 1 OFFERED IN THE SENATE TO HJR 4 Page 1, line 5, following "integrity": Insert "; urging the United States Congress to reject any proposal to divert or otherwise reduce revenue sharing to the coastal states and their political subdivisions under the Gulf of Mexico Energy Security Act of 2006; and urging the President of the United States to direct, to the maximum extent possible, federal funds received from outer continental shelf development, and not dedicated to states or other federal programs, to federal infrastructure in the affected states" Page 1, lines 7 - 13: Delete all material and insert: "WHEREAS the state, which has more coastline than the rest of the United States combined, requests that the United States Congress pass legislation that allows the state to equitably share revenue generated on the outer continental shelf of the state; and" Page 2, lines 7 - 8: Delete "federal oil and gas leases in outer continental shelf areas adjacent to each state" Insert "leases covered under phase one of the Gulf of Mexico Energy Security Act of 2006; phase two of the Gulf of Mexico Energy Security Act of 2006 expands the definition of "qualified outer continental shelf revenue" and continues to share revenue on an adjacency factor but includes an annual revenue- sharing cap of $500,000,000 that applies through 2055" Page 3, line 5, following "opportunities": Insert "or, alternatively, could be used for deficit reduction" Page 3, line 11, following "integrity": Insert new material to read: "; and be it FURTHER RESOLVED that the Alaska State Legislature urges the United States Congress to reject any proposal to divert or otherwise reduce revenue sharing to the coastal states and their political subdivisions under the Gulf of Mexico Energy Security Act of 2006; and be it FURTHER RESOLVED that the Alaska State Legislature urges the President of the United States to direct, to the maximum extent possible, federal funds received from outer continental shelf development, and not dedicated to states or other federal programs, to federal infrastructure in affected states" SENATOR STOLTZE objected for discussion purposes. CHAD HUTCHISON, staff to Senator Coghill, sponsor of Amendment 1, explained that the amendment was based on ongoing conversations they had had with Senator Murkowski's staff, Mike Pawlowski on how to increase Alaska's share of offshore revenue. He said that right now, Alaska is under the authority of the Outer Continental Shelf Lands Act (OCSL), which means that it receives 27 percent for offshore revenues in areas 3-6 miles away for the coast. The way it works is that the 27 percent is taken out by the federal government for offshore leasing and given back to the state so it can use it to increase infrastructure on shore. The only relevant field that is privy to this provision is the North Star Field in the Beaufort Sea, but the expectation is that if the Liberty Field comes on, it would increase that revenue. Concurrent to that is the Gulf of Mexico Energy Security Act in which the Gulf States - Alabama, Texas, Louisiana, and Mississippi - receive 37.5 percent of the offshore revenues. They get more for a number of reasons: because it occurred in 2006 that had the right type of political influence and a tremendous amount of drilling and in an area that is subject to hurricanes. 4:23:12 PM Alaska wants to increase the amount of offshore revenue it gets from the federal government. SENATOR STOLTZE said this proposal replaces a contentious provision that would have disrupted a historical argument the state has made and made it much stronger and asked if it requires a title change. MR. HUTCHISON answered yes. CHAIR GIESSEL said the title change was on the amendment page. SENATOR COSTELLO said one congressional office has indicated support and asked if the entire congressional delegation been contacted about this amendment. 4:24:49 PM MR. HUTCHISON that have had briefings with representative of Senator Sullivan, but the primary person that is most familiar with the oil and gas is Mr. Pawlowski and they rely on him at this point to communicate the message to the others in the delegation. SENATOR COGHILL said they are trying to give a tool to congressional delegation that adds Alaska's voice go to the other states' that opposes distributing that 37.5 percent to other federal or conservation programs instead of it going back to the states. REPRESENTATIVE SADDLER, sponsor of HJR 4, Alaska State Legislature, Juneau, Alaska, said he supported the amendment. SENATOR STOLTZE removed his objection. CHAIR GIESSEL announced that Amendment 1 was adopted. Finding no further comments, she closed public testimony. SENATOR COSTELLO mentioned that this resolution has bi-partisan support in the other body. It is an important issue of debate that Congress will be having. SENATOR STOLTZE said he appreciated that Senator Murkowski was taking the lead on this. SENATOR COSTELLO moved to report HJR 4, as amended, from committee with individual recommendations and attached fiscal note(s). There were no objections and therefore, SCS HJR 4(RES) moved from committee.