BERTA'S BRIEFINGS 

Representative Berta Gardner
Serving Geneva Woods, College Village, Green Acres,
Tudor, Taku and Campbell Park

Write Me:     State Capitol Bldg., Room 424
                       Juneau, AK 99801
Call Me:        1-800-331-4930
E-Mail Me:   Rep_Berta_Gardner@legis.state.ak.us
My Website: http://gardner.akdemocrats.org

May 25, 2010

Natural Gas Storage Incentives and
In-State Gasline Pass the House

Dear Friends and Neighbors,

         Two bills which passed the House this week are efforts to address the pending gas shortage for Anchorage and the rest of south central Alaska.  With misgivings (as described below), I voted yes on both because they attempt to address critical issues for my constituents and because I was assured they would not adversely impact our efforts to take our gas to market through a big gas pipeline.  We do not know what the future brings and it is appropriate to keep our options open.

• House Bill 280 provides incentives for construction of gas storage facilities in Cook Inlet and addresses regulatory issues to insure consumer protection.  Part of the problem for producers is that our gas use is much higher in winter than summer, making it challenging for producers to match their production with utility needs.  Access to a storage facility will help solve this problem, balancing out supply and demand.
   
• House Bill 369 creates a development team in the Governor’s office to study the in-state gas pipeline options and make recommendations by July for the “most economical” gas pipeline to provide gas to the greatest number of Alaskans at a reasonable cost. 

         Although I was a yes vote on both bills, neither vote was easy for me.  I recognize the value and need for a gas storage facility and hope that having one will be beneficial to our consumers over the long run, but I’m concerned about the level of tax benefit we provided, especially given that Cook Inlet gas already has the lowest tax rate of any petroleum production in the state.  In fact, the value of the new benefits may exceed what is being paid in Cook Inlet and be applied against North Slope production – this in spite of the fact that there has been no testimony whatsoever that taxes are the reason for declining Cook Inlet gas production.  The production issue is a matter of lack of storage and a small sales market. 

         My heartburn over the in-state gas pipeline bill comes because the new team, consisting of representatives from the Alaska Railroad, the Alaska Housing Finance Corp., the Department of Transportation and the Alaska Natural Gas Development Authority, are not experts in gas pipeline planning, construction or cost estimates, yet they are charged with making a recommendation in a very short time period.  Furthermore, the bill includes no information about who might build the line, pay for it or own it – surely relevant issues.  The premise makes a good sound bite but I fear that once again we may have identified a real problem and applied a fix which misses the mark.

         House Bill 280 and HB 369 will now be transferred to the Senate for consideration. 

         One last reminder on an important Alaskan issue:   the deadline for applying for the Permanent Fund is Wednesday, March 31^st.  You can apply on line through the link below or find a paper application through the Booklet Distribution link.

·         PFD site http://www.pfd.state.ak.us/

·         Distribution sites for paper apps http://www.pfd.state.ak.us/BookletDistribution.aspx

·         Pick. Click. Give. site http://www.pickclickgive.org/

         I'm Berta and I’m still listening...