House Floor Session, 5/18/26, 9am

Will the House please come to order?

Will members please indicate their presence by voting?

Has any member failed to vote?

Will the clerk please tell you the board? 34 Members present. With 34 members present, we have a quorum to conduct business. Mr. Majority Leader.

Mr. Speaker, there are no previous excused absences today. Leading the invocation this morning is our very own Representative Sadler. Will members please rise.

Thank you, Mr. Speaker. With deep respect for all beliefs and all believers, I offer this prayer. Almighty God, we come together today on the first day of the last week of our legislative session, mindful of the great responsibilities entrusted to us as public servants. We ask you to bless this assembly and the work it does on behalf of our beloved Alaska. We ask for the gift of wisdom to guide our discussions, the grace to listen to one another, and the unified spirit to seek the common good for all our people.

May you give us grace to forgive those who trespass against us and help us to understand that differences of opinion between us reflect different but no less principled or deeply held opinions. We are all your children. At a time when our bodies and spirits may be flagging, we ask you to uplift us, heal us, and restore us with the energy to meet and overcome our every challenge. May the words we speak today, the actions we take today, and the votes we cast today reflect the spirit of integrity, fairness, and justice. And finally, Lord, we ask you to preserve the health and happiness of all who serve in this building so that we may better serve thy will with peace and joy.

All this we ask in the name of Jesus Christ, your Son, our Savior. Amen. Amen. Representative St. Clair, will you please lead us in the Pledge of Allegiance? I pledge allegiance to the flag of the United States of America and to the Republic for which it stands, one nation under God, indivisible, with liberty and justice for all.

Representative Story. Mr. Speaker, I move and ask unanimous consent that the prayer be spread across the journal. Hearing no objection, the prayer will be spread across the journal. Would the clerk please certify the journal for the previous legislative days?

I certify as to the correctness of the journal for the 118th legislative day. Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the journal of the previous day be approved as certified by the chief clerk. Hearing no objection, the journal stands approved.

Are there guests for introduction this morning? Representative Freer.

Thank you, Mr. Speaker. While I don't have a guest in the gallery, I do have a guest in the building. My husband is here. He's in my office. He didn't want to be in the gallery.

Because he didn't want to be introduced. But I do just want to acknowledge, you know, the sacrifices that we make and how grateful I am that I have the support of my family here. And he's not in the room, but he is in the building and he's watching right now. So I just want to say thank you, love, for being here. And I love you so much.

Are there any additional guests for introduction? I'm not seeing any. Madam Clerk, are there any messages from the governor? I have no messages from the governor this morning, Mr. Speaker. Any messages from the other body?

Messages dated May 17th stating the Senate has passed and is returning the following: House Concurrent Resolution number 19, suspend uniform rules for Senate Bill 143. House Joint Resolution number 28, support kids Online Safety Act, and CS for House Bill number 363, MLV, Alcohol Patriotic Organizations Club Licenses. The Senate has passed committee substitute for House Bill number 23, Labor and Commerce, with the following amendments. Senate committee substitute for committee substitute for House Bill number 23, Finance, effective date added Senate with the title change as SCR 23, and it is returned for consideration.

The Senate has also passed CS for House Bill number 27, Health and Social Services, with the following amendments: Committee Substitute for House Bill number 27, Health and Social Services, amended Senate, effective date add Senate, and it is returned for consideration with title change SCR 33.

The Senate passed Committee Substitute for House Bill number 133, Finance, amended with the following amendments: Senate Committee Substitute for Committee Substitute for House Bill Number 133, Finance, Amended Senate, Payment of Contracts, and it is returned for consideration. The Senate concurred in the House amendments to Committee Substitute for Senate Bill Number 143, Community and Regional Affairs, thus adopting Committee Substitute for Senate Bill Number 133— excuse me, 143, Community and Regional Affairs, Amended House. School Board Terms Training City Councils, with title change HCR 19. The Senate has passed and is transmitting the following for consideration: Senate Concurrent Resolution Number 32 by the Senate Finance Committee, suspending Rules 24C, 35, 41B, and 42E, Uniform Rules of the Alaska State Legislature, concerning House Bill Number 23, renaming the State Commission for Human Rights the Alaska State Commission for Civil Rights, relating to removal of commissioners of the Alaska State Commission for Civil Rights, relating to reports from the Alaska State Commission for Civil Rights, relating to the definition of employer for the purposes of the Alaska State Commission for Civil Rights, and relating to local civil rights commissions. The Senate has also passed and is transmitting the following for consideration: Senate Concurrent Resolution Number 33, by the Senate Rules Committee, suspending Rules 24C, 35, 41B, and 42E, Uniform Rules of the Alaska State Legislature, concerning House Bill number 27, relating to the medical care for major emergencies.

I have no further messages from the other body. Madam Clerk, are there any communications? There are no communications this morning. Any reports of standing committees? The Finance Committee considered Senate Bill number 79, payment of wages payroll card account, recommends it be replaced with House Committee Substitute for Senate Bill 79, Finance.

With a technical new title, attached 1, new 0 fiscal note. Signing the report, do pass: Representatives Jimmy, Galvin, Hannan, Bynum, Co-Chair Foster. No recommendation: Tomaszewski, Stapp, Allard, Moore, Co-Chairs Schraggi and Josephson. The bill has no further referral.

The Finance Committee also considered committee substitute for Senate Bill HB 24 Finance Tobacco Nicotine Age E-cigarette Tax recommends it be replaced with House Committee Substitute for Committee Substitute for Senate Bill 24 Finance with the same title, attached 1 new fiscal note and 7 new zero fiscal notes. Signing the report do pass: Representatives Moore, Hannon, Galvin, and co-chairs Josephson, Schraggy, Foster. No recommendation. Aller, Tomaszewski, Amend, Bynum, and Jimmy. The bill is on today's calendar, and I have no further reports of standing committees.

Are there any reports from special committees? The Conference Committee Considering— with Limited Powers or Freed Conference Considering Committee Substitute for House Bill Number 263 Finance Amended, and Senate Committee Substitute for Committee Substitute for House Bill 263, Finance, amended. Senate recommends Conference Committee substitute for House Bill 263 with a new title. Signing the report: Representatives Josephson, Chair, Schraggy, Stapp, Senators Hoffman, Chair, Steadman, and Senator Cronk.

And the Conference Committee with Limited Powers of Free Conference, considering committee substitute for House Bill number 265 Finance amended and Senate committee substitute for committee substitute for House Bill number 265 Finance mental health budget, recommends conference committee substitute House Bill 265 with the same title as the House and Senate versions Signing the report, Representatives Josephson, Chair, Shiragi, Staff, Senators Hoffman, Chair, Steadman, and Cronk. There is a fiscal note packet attached, and both reports were received in the House 517 at 3:11 PM. I have no further reports of special committees. Madam Clerk, are there any citations or resolutions for introduction? There is a special order citation calendar and House Concurrent Resolution number 27.

Suspending Rules 24C, 35, 41B, and 42E, Uniform Rules of the Alaska State Legislature, concerning Senate Bill number 79, relating to wage payments. And House Concurrent Resolution number 28 by the House Community and Regional Affairs Committee, suspending Rules 24C, 35, 41B, and 42E, Uniform Rules of the Alaska State Legislature, concerning Senate Bill number 250, relating to data centers and relating to utility service for data centers. I have no further citations or resolutions for introduction. Mr. Majority Leader.

Mr. Speaker, I move and ask unanimous consent that notice and publication requirements be waived and the citations on the first special order citation calendar be made a special order of business. Without objection. Once again, Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House approve the citations on the first special order citation calendar.

Hearing no objection, the citations are approved. Madam Clerk, are there any bills for introduction? I have no bills for introduction this morning, Mr. Speaker. This brings us to consideration of the daily calendar. This time I would like to bring Senate Bill 180 before the body.

Brief it ease. Brief it ease.

Will the House please come back to order? We should have at least 2 amendments circulated to members. Madam Clerk. Committee substitute for Senate Bill Number 180, Labor and Commerce, by the Senate Labor and Commerce Committee, entitled An Act Relating to the Regulation of Liquefied Natural Gas Import Facilities by the Regulatory Commission of Alaska and Providing for an Effective Date. The Labor and Commerce Committee considered the bill.

Recommends it be replaced with House Committee Substitute for Committee Substitute for Senate Bill 180, Labor and Commerce, with a new title, HCR 20. Attached one previously published zero fiscal note. Signing the report, do pass. Representatives Carrick and Co-Chair Fields. No recommendation.

D. Nelson, Colon, and Co-Chair Hall amend. Freer. There is one House Committee Substitute. Mr. Majority Leader.

Mr. Speaker, I move and ask unanimous consent that the House Labor and Commerce Committee substitute for Senate Bill 180 with a new title be adopted in lieu of the original bill.

There is an objection. Representative Johnson. Thank you, Mr. Speaker. I would object to the introduction of Senate Bill 180 and request I'd like to ask for Senate Bill 180 and request some changes. Yeah, I'm going to ask you maybe if you could speak directly in your mic.

I think we got the gist. You're asking for explanations in the committee substitute that's before the body. Now I'm going to turn to Representative Fields to do that. Thank you, Mr. Speaker. The only change was the addition of a line directing AEA to pursue the Susitna Hydro project.

I would note for members that a briefly forthcoming amendment We'll then remove that, and I would urge adoption of the CS so that we can move forward with consideration on the gas line. Thank you.

The objection is— I object. There is another objection. Representative Freer. Thank you, Mr. Speaker. I don't wish to speak to my objection.

I just don't want to move from the original to the L&C version.

Brief at ease.

Are you ready for the question? The question before the body is, shall the Labor and Commerce Committee substitute be adopted? Members may proceed to vote.

Will the clerk please lock the roll?

Does any member wish to change his or her vote? Representative Jimmy. From nay to yay.

Will the clerk please announce the vote? 28 Yeas, 10 nays. We voted 28 yeas to 10 nays. The committee substitute for Senate Bill 180 has been adopted. Madam Clerk.

Amendment number 1 by Representative Gray, beginning page 1, line 1. Representative Gray. Mr. Speaker, I move Amendment 1. There's an objection.

Mr. Speaker, Amendment 1 ensures that Alaskans reap the maximum benefit from the utilization— permission to refer to my notes. Permission granted. Amendment 1 ensures that Alaskans reap the maximum benefit from the utilization and development of our natural resources as Article 8, Section 2 of our state constitution demands. By making it so that all corporations extracting our most valuable natural resources be taxed equally. Our forefathers and foremothers crafted a Constitution in the wake of a terrible pillaging of natural resources at Kennecott.

The miners took the copper from the mine, it was sold at great profit for the company itself, and Alaska got almost nothing in return. Our Constitution ensures that this should never happen again. Alaska has trillions in dollars of treasure. We allow companies to come take that treasure and sell it on a world market to make great profits. All we ask is that Alaska receive a percentage of those profits.

The treasure, after all, is Alaskan treasure. We have several taxes that allow our people to collect a proportion— a portion of the companies' profits. But one particular tax no longer applies to some companies doing business here, and this was not the intent of our state government. In 1980, this body got rid of the personal income tax. At the time, this had very little to do with corporate income taxes.

S corps at the time were defined as businesses with 10 or fewer shareholders. No major oil or gas company had so few shareholders. For the past 46 years, our tax structure with regard to income tax has been completely reliable and stable. We haven't had one. But what constitutes an S corp has changed drastically.

S corp— S corporation laws were created by the United States in 1958. Congress created the S corp structure to stimulate small business growth. Lawmakers wanted to allow small family-owned shops to gain corporate legal protections without facing heavy corporate tax rates. In 1996, the U.S. Congress upped the limit to 75 shareholders. It also allowed S corps to own other S corps.

It also allowed S corps to own C corps. In 2004, the U.S. Congress bumped it up to 100 shareholders. Mr. Speaker, we have constantly been told that for Alaska to be a good business partner, we must have stable, reliable tax policy that does not change from year to year. But what about the other party? If the definition of different types of companies changes from year to year, that's not a stable, reliable partner for Alaska.

Mr. Speaker, this amendment is not about, about one particular company. In fact, the company that is usually named would pale in comparison to Glenfarm once LNG exports began.

Resource extraction businesses do not come to Alaska because we don't tax S corps. They come because of our vast reserves of treasure. The makers of our Constitution wanted to protect the Alaskan people from another Kennecott. This amendment achieves that aim, and I believe in this amendment with all my heart, Mr. Speaker. But I have been told that this amendment is not welcome, and because I am committed to finding affordable energy in the near future for my constituents, I reluctantly withdraw Amendment 1.

Amendment number 1 has been withdrawn. Madam Clerk, Amendment number 2 by Representative Kopp, beginning page 1, line 1. Representative Kopp. Mr. Speaker, I move Amendment 2. There's an objection.

Mr. Speaker, this amendment encompasses why we are here. Alaska is at an energy crossroads, and permission to refer to my notes, Mr. Speaker. Thank you, Mr. Speaker. Our population centers are facing energy supply that is well known to us. We know it's unstable, it's insecure, and looking at a near-term future of increasingly unaffordable energy in the Central Railroad corridor and in Western Alaska and in Northwestern Alaska.

It is already completely unaffordable, and every month we wait, that problem gets worse. Mr. Speaker, without this project, this enabling legislation that will make the AK LNG possible, we know we will end up long-term importation of liquefied natural gas from foreign sources. That means foreign jobs instead.

Of Alaska jobs, foreign revenue instead of Alaska revenue, and foreign energy security instead of our own. For more than a decade, we have known what it would take for this project to pencil out, that it would take property tax reform for this to be possible. Our producers told us this in 2014 when they could not make this project pencil out, that we would have to address this. This is done in this amendment. We also knew that it would take real tools for the communities along the route that would benefit them as we pull this together.

This amendment does this. What we have in front of us, Mr. Speaker, is a compromise. It draws from the House resources version, from the governor's original bill, from the Senate resources version. Everybody gave something, and what we end up with is a tax structure that the project can take to investors and be established for success, paired with the protections our communities along the route need as this project is built and goes into production. Talking about the gas supply briefly, Mr. Speaker, the AK LNG project is essential to securing a long-term stable energy supply for Alaska, ensuring that our homes, businesses, and critical infrastructure across the rail belt and interior have reliable access to affordable natural gas for decades to come.

Without a secure in-state gas source, Alaskans face growing exposure to volatile markets and risk of supply disruptions that threaten our heating, electricity generation, and economic stability. A brief summary of the revenue summary, Mr. Speaker. The total revenue from the Alternate Volumetric Tax begins at $36 million in 2031 this is just the ABT I'm talking about now, rising to $121 million in 2033 and thereafter escalating at 1% per year. Total state revenue from the AKLNG project is projected to be $22.8 billion through 2062. This is from our Department of Revenue.

I would refer members to the Department of Revenue put together handout on the desk.

Mr. Speaker, the total revenues that members can look at, annual state revenues, that's the last page of that, shows that after just 6 years, we're close to $800 million a year in revenue to Alaska. Combination of the property tax and AVT, the corporate income tax. Some might say, well, where does corporate income tax play in? We will receive corporate— additional corporate income tax based on the revenues oil and gas companies earn from selling gas into this project. And finally, the royalties and production tax.

Mr. Speaker, this is a transformational revenue project for our state and energy security. Local governments get to tax this project directly. Under this amendment, a borough or city collects its own share of the volumetric tax on project property inside its boundaries. They do not wait on Juno to have an appropriation to then send them their share. They have a direct predictable revenue stream tied to how much gas is actually flowing.

Mr. Speaker, this amendment provides for a $40 million community impact fund paid by the developers. It's front-loaded, not by the state, but by the developers. Every impacted community gets 25% of its expected construction impact costs up front, and then they can submit additional costs for reimbursement as they come in, and those funds are paid out each quarter. The impacted municipalities in this project, Mr. Speaker, are the North Slope Borough, the Fairbanks North Star Borough, the Denali Borough, the Municipality of Anchorage, the Matanuska-Susitna Borough, and the Kenai Peninsula Borough. Mr. Speaker, in addition to the Community Impact Fund, there's an LNG mitigation fund of up to $90 million a year.

This one is funded through state revenue from the project. At $30 million or less, equal shares go to the 6 impacted municipalities, $5 million each. Between $30 and $60 million, each of the 6 gets $5 million, and the rest is split between the North Slope Borough and the Kenai Peninsula Borough, because that's where the gas is coming from and that's where the gas is being exported from. Over $60 million appropriation would result in those 2 boroughs getting an additional $15 million each, and the remainder divided by population across every municipality in Alaska. Except the ones already served by a spur line.

So no matter the size, Mr. Speaker, the heaviest impacted regions are recognized first, and then the broader state shares in the benefit as the project goes. Mr. Speaker, this amendment provides a direct state equity option. Anytime Alaska Gas Line Development Corporation is negotiating to participate in a revenue-generating project, It has to also negotiate an option for the state to take itself up as an investor interest in the project. The legislature decides whether to exercise that option, acting as a prudent investor. We get to evaluate on the best terms with the best information Alaska Gas Line Development Corporation and its partners can give us.

Mr. Speaker, rural and interior Alaska are not left behind. A Fairbanks spur line is required in this, Mr. Speaker, with the costs shared statewide. The project does not get the tax framework unless its plans include a spur line to Fairbanks, a spur line that has the capacity to meet projected demand in the interior, and that means beginning operation— begins— that means it begins operating within 2 years after a major component of the gas line is set up. Mr. Speaker, rural Alaska is going to maintain the hard-fought revenue share of gas currently in statute. Communities that are not on the pipeline route will not be forgotten.

As amended, this will enhance the Rural Energy Fund, paid out of state royalty gas revenue, keep funding energy infrastructure in off-pipeline communities. Power cost equalization keeps working in every region of Alaska. Gets a share of this project one way or another. Mr. Speaker, this provides a competitive, predictable tax structure. A temporary tax holiday will be in place to get this project up and running while it's coming online.

This abasement— this abatement ends at whichever comes first: when the throughput through the gas is 500 million cubic feet a day on a 30-day rolling average, or 5 years after commercial operations start. That window is the runway. It gives the project time to ramp up, and it makes room for both Alaska's gas needs and projected industrial demand. It involves a simple, transparent volumetric tax. The project will pay a tax after the holiday based on how much gas is actually flowing through the line, not on guessed-at property values, on real throughput.

The rates are 6 cents per 1,000 cubic feet on the pipeline, 12,000 cents on the gas treatment plant and carbon capture, and 12 cents on the LNG plant. Each component shares a tax weight by how much capital was invested in it. The bigger the investment, the bigger the share, and that's why we see the gas treatment plant and the export facility having the biggest tax share. They cost the most. Mr. Speaker, this has built-in accountability.

If construction on the first 730 miles of pipeline has not begun by 2032— I will say this again— if construction on the first 730 miles of pipeline has not begun by 2032, the whole volumetric tax framework goes away and the standard property tax comes right back. We are not handing out tax treatment for a project that never gets built. And the tax framework only takes effect if the developer commits to 3 things: putting up the $40 million for the community impact fund, Signing a project labor agreement.

Yes, one moment, Mr. Berger. Yes, that covers all three facilities, Mr. Speaker. This was a question, did it cover the gas treatment plan, the pipeline, the export plan? It does cover all three facilities. And building the Fairbanks spur line with construction starting within a year of getting the permits.

So if there's no commitments, there's no tax framework. Bless you. Mr. Speaker, this amendment is about jobs for working Alaskans. The project labor agreement covers contractors of the gas treatment plant, the carbon capture facility, the LNG plant, and the pipeline. It is designed to deliver expedited construction with labor civility using qualified Alaska residents.

Any natural gas pipeline must be done Alaska First. The Project Labor Agreement is the best way to ensure that Alaskans are employed on this project. The Project Labor Agreement provides a concrete workforce development mechanism through apprenticeship utilization requirements, and with an estimated 7,000 construction workers needed for this gas line project, having a Project Labor Agreement in place will help source, attract, and retain workers in an extremely tight and ever-tightening labor market. The Trans-Alaska Pipeline was built 100% with a project labor agreement. Alaska Gas Line Development Corporation must use Alaska contractors and Alaska workers.

Alaska suppliers to the maximum extent possible. We have decades of Arctic engineering and construction expertise in this state, and this amendment puts that experience to work. Speaking to the state revenue and long-term investment, Mr. Speaker, the project revenue does not just disappear into the general fund. It will flow to the Rural Energy Fund, which is already in state statute, to the Community Impact Fund from the developer, and with legislative appropriation, to the AK LNG Mitigation Fund. Let's talk a little bit about the transparency and oversight at AGDC in this amendment.

The Alaska Gas Line Development Corporation reforms in this amendment are a compromise. They draw from the Senate Resources Committee, especially Senator from District E working on the confidentiality piece. The point of these reforms is twofold. First, to make absolutely sure that the state's full faith and credit is never quietly put on the line in inside a nondisclosure agreement. And second, to make sure that the Alaska Gas Line Development Corporation delivers the legislature the best information possible when it comes time to decide on equity stakes or other major decisions.

Alaska Gas Line Development Corporation can use nondisclosure agreements. It needs them to do this job. But those agreements can't put the state money at risk, and they can't hide significant fiscal liabilities or the state investment option. Genuine trade secrets about project economics can still be protected. AGDC cannot issue large bonds without legislative approval.

AGDC has to follow the Open Meetings Act, and revenue AGDC generates flows through the regular project. Mr. Speaker, the bottom line is this amendment finally moves the Alaska LNG project forward. It gives the project a competitive stack structure. It needs to get built. It secures a $40 million community impact fund paid by the developer.

It sets up a mitigation fund of up to $90 million a year for the communities more affected. It guarantees a Fairbanks spur line. It locks in a project labor agreement for qualified Alaska workers. It keeps rural energy support flowing, and it sets up a long-term funding source for all these entities. The tax breaks only kick in If the developer delivers on these commitments and if construction has not begun by 2032, the standard tax framework comes back.

Alaska gets a stable gas supply. Alaska gets the protections. And Alaska keeps the control. I urge support of the amendment. Thank you, Mr. Speaker.

Briefities.

Will the House please come back to order? Representative Fields, I'm going to go to Representative McCabe. His mic was up first.

Thank you, Mr. Speaker. Well, here we are. Good morning. We are at an inflection point that we have been at at least 3 times in the last 3 decades. Make no mistake, Alaskans need to understand this is about whether or not we move forward with a legacy project for our children and our grandchildren, or whether we don't.

Some of it depends on your philosophy. You want the state to get paid now for a project that may or may not move, or do we want to wait until the project is moving and garner the income and the revenue from the gas that flows through that line? That's a basic philosophical difference. Alaska has been burned before on projects— Rail, other projects that we have had some sort of agreement on. And so I understand the idea that Alaska should be paid first with a, with the property tax or whatever, but a project of this size a megaproject is not going to happen unless we have some sort of way to relieve the tax on the developer as he builds the project.

You just cannot expect anybody unless it's some, some, a government, unless it's our government, the federal government, to fund this upfront with the property tax that would be required.

So we need to make a decision today, Mr. Speaker. We need to make a decision on whether we want to move forward or whether we want to pull back. And Alaska has— unfortunately, this body has a history of stopping things in the middle. We just do. Point McKenzie rail extension, you guys know that.

I talk about it all the time. That's one. We've done that numerous times. Got something half built, got something halfway. And then we got scared.

Sisseton Wahpetonah. There's many examples. So we have spent a great amount of time in this body in the last 2 weeks hammering out this agreement that this amendment sort of begins. I understand there's gonna be lots of amendments to the amendment and we are doing a committee of the whole today. Don't make any mistake, normally this would have gone through energy resources, and certain aspects of it has, but at the end of the day, we all want our— fingerprints is the wrong word— but we want our ideas put in play, Mr. Speaker.

And that's what we're doing here today. Alaska needs to clearly understand that we as a body of 40 are trying to move this forward. You all know me, I'm a resource development person. I firmly believe that this project needs to move forward. It just has to.

Our children and our grandchildren and indeed this state's future depend on it. So we need to find a way to do that. And I hope that we can have the mindset of yes, yes, but. Let's start at yes and then say, but. Yes, but we need this.

Or yes, but we need that. Instead of saying no because we're not getting state revenue upfront. We need to start with the mindset of yes, we are going to develop this, and then figure out a way and a path forward. For me, Mr. Speaker, without going into the details of the amendment, there's some pieces of this amendment I don't like. I think that they will be worked on in the next, in the coming few moments when we're talking about this amendment.

But for me, Mr. Speaker, This is a start. We need to say yes to this amendment and then continue our work on this. And I, and I would like to thank the member from Anchorage for putting so much work on this. I understand there were many sleepless nights putting this all together, and, and I really appreciate it. And I appreciate the explanations he's given to many people, and certainly the, the other folks that have worked on it from the, uh, the executive office to, uh, to the committees.

So, Mr. Speaker, let's start today with this amendment with a.

Yes, but, yes, but I have an amendment to do this. Yes, but let's do this. Let's start with a yes. Let's start with a yes mindset for our state and for our children, for their children and their children. I think that's vitally important, Mr. Speaker, and I think that we should support this amendment.

Thank you. Representative Fields. Thank you, Mr. Speaker. I do rise in support of adopting Amendment 2. And I want to acknowledge the hard work of the resource co-chairs and the majority leader who have tried to advance the best possible legislation under extremely severe time constraints and without anywhere near the typical level of project economic data that any sovereign around the world would demand in order to set tax policy.

So I think our colleagues have done extraordinary work under the most difficult circumstances possible. Fundamentally, an alternate volumetric taxation framework can be more fair, um, for the state of Alaska as a whole than property taxes alone. And on a very basic level, that's why I support the amendment. Furthermore, the community benefits agreement, the project labor agreement language in this bill, the direction of revenue into a constitutionally protected education fund contingent on voters' approval of such a fund Those are all positive provisions that ensure both the project is most likely to move forward in as economical and as timely a manner as possible. That's what the PLA language does.

It does maximize Alaska higher opportunities. And look, if we're going to be building a pipeline in Arctic conditions, that pipeline is going to be delivered as quickly and as economically as possible. If you have pipefitters and teamsters and operating engineers with Arctic experience, that's a no-brainer. The community benefits agreement is a very logical way of ensuring we have predictable costs, but we are also mitigating community impacts. And like I said, an alternate volumetric taxation, I believe, fundamentally is a better structure to get revenue than property taxes alone.

Having identified some of the— and by the way, I think one thing that I've heard throughout the debate on the gas pipeline is how does this bill benefit the rest of the state. And looking at the community benefit agreements, looking at the AVT, those are elements that ensure we have benefit across the rest of the state. The provisional language around a constitutionally protected education fund also helps ensure all Alaskans have a stake in success of this project. And I know a forthcoming amendment will address restoration of the Rural Energy Fund, which is extremely important and is an existing statute today. I think we also have to acknowledge unknowns and things that are beyond our control.

Passing this bill does not mean that the— a gas line will necessarily get built. A gas line will get built if there are buyers for the gas and financiers for the project, and that is outside our control. We can be supportive. We cannot alone determine success for this project. And in fact, for a long time, we heard the project would progress or not progress independent of what we did.

So I think we should vote for good policy to increase the likelihood that the project occurs. I do not think, and it is a fact, that the success of the project simply is far beyond our control and dependent on global forces, availability of financing, and so on. It is also important to acknowledge that this project may produce affordable gas at high throughput dependent on a lot of export volume However, I think we have to be transparent with consumers that if we move forward with this project and those export agreements do not materialize and our South Central Utilities are the base customer, gas will be very expensive. An estimate, $23 per MCF. That is almost 3— it's approximately 3 times higher than the current Hilcorp contract with Instar for the Cook Inlet Basin.

And it's nearly twice as high as the current contracts for smaller units producing gas from within Cook Inlet. So can a gas line deliver affordable energy? Yes, but we have to acknowledge and be very transparent with the public. It does not necessarily guarantee affordable energy. I think this is a good amendment.

We should move forward with it. There are further refinements. I, I think one final thing that we should take very seriously is there are two chambers And if our goal is to advance legislation that supports the gas line, we should be very cognizant of what it takes to get this bill across the finish line. And this amendment is a very good start, and we have some more work to do with subsequent amendments. Representative Riccides.

Will the House please come back to order? We're under debate on Amendment Number 2. Representative Gray, I think you are next in line. Thank you, Mr. Speaker. I rise to speak against the change on page 1 in Amendment 2, which deletes the development of the Susitna River Power Project.

Mr. Speaker, Alaska is on the front lines of climate change. And when billions and billions of dollars are going to be invested into a project that is going to result in more greenhouse gases, the least we can do is to fund renewable energy projects that transform the rail belt where the, the vast majority of Alaska's population lives. I strongly support using this project as leverage for the Susitna-Watana Dam Thank you, Mr. Speaker.

Representative Carrick. Thank you, Mr. Speaker. As others have said, well, here we are. In Amendment Number 2, we see the mechanism which could transform the economy of the state of Alaska. And today, Mr. Speaker, I rise in general favor of this amendment.

But Mr. Speaker, I also rise with a great degree of hesitation, and I am really looking forward to the work that is going to be done today in the coming hours. I think it is essential that we do that work, and it's essential that we take that seriously. Mr. Speaker, if I were to ask a room of 100 Alaskans, maybe even 1,000.

Alaskans, do you support a natural gas pipeline in the state of Alaska? I doubt that you would see one hand fail to be raised in that group of people. Alaskans want reliable, cheaper, cleaner power across the state. Rural communities want PCE to be even further supported by the rail belt having reliable, cleaner, cheaper power. And natural gas provides that.

I want to start this whole conversation by saying I support the underlying momentum around Amendment Number 2. I support the work that the sponsor of this amendment has put into it, trying to move heaven and earth to make this happen in this body. And I support the work of the resources co-chairs that help to inform much of the work that is in this amendment. Mr. Speaker, at the same time, We are doing committee work on the floor today. We are going to see a process that most people don't usually get to see happen in this body, and to some extent I think that's a good thing.

I think Alaskans want to see us do that work and they want to see it live because they stand to benefit greatly if this project goes forward. Mr. Speaker, if I could have permission to read really briefly. Permission granted. Thank you, Mr. Speaker. So Today in Fairbanks, the Daily News-Miner ran an opinion piece from the paper, and it talked about support with hesitation for this project.

And in part, the paper said, "This project could transform Alaska's economic future. It could provide long-term energy security, create thousands of jobs, and generate billions in economic activity. These opportunities are real." However, so too is the risk of repeating an all-too-familiar mistake: surrendering enormous public value in the desperate hope that industry investment will save the state. Mr. Speaker, I could not agree more with the comments from the Fairbanks Daily News-Miner editorial board today. Mr. Speaker, ultimately, I, I don't want to speak for 20 minutes on it.

I don't want to go into all the details of the amendment or future amendments on this. I am not the expert. I don't sit on the Resource Committee. I wasn't in the Finance Committee hearings. I don't know all of the ins and outs of every aspect of the project that we're gonna talk about today.

And I think that that's probably true of a lot of people in this room. I think that should give us a little bit of pause here. I think we should spend the time we need to today to thoroughly consider each other's perspectives, to try to get to yes, as the member from Big Lake said, do what we can to get to yes, but I do think we should take a moment and consider these amendments very seriously. At the end of the day, Mr. Speaker, I am not an expert, but I am an Alaskan. I am an Alaskan in a community in Fairbanks where we pay 23 MCF, where we pay $6 for heating fuel per gallon.

We are living Anchorage's prospective reality without a steady natural gas supply, and we have been living it for decades. Amendment number 2 provides for a more stable, steady future if the project goes forward for our community. But it also may do so at some pretty serious risks, at some pretty serious costs for our communities, and we need to spend some time considering those risks and those costs. Is this process today going to be unusual? Yes.

Yeah. Is the process we go through and the product that comes out of it possibly historic? Absolutely. Ultimately, is what we are doing definitely monumental? Without hesitation, it is.

But I want this process to be transformational for the state of Alaska. I do not want to run into, as the Newsminer said and as so many others have repeated in this process, the all-too-familiar mistake of putting enormous public value on the hope for this industry project to take place. Let's go forward with the work. Let's do so in earnest. Let's do so with some degree of expediency.

But let us not lose sight of the fact that the decisions we make today could either transform the state of Alaska or lock us into a future that does not provide that enormous benefit for all regions of the state. And let's think carefully as we make the decisions today. Thank you, Mr. Speaker. Representative Holland. Great, thank you, Mr. Speaker.

I want to rise in support of the amendment, but looking ahead at some of the additional work we're going to do today, I want to take a moment and share with you and others, I think, the framing I want to encourage us to look for in doing this work today, and that is I think in considering this amendment in the bill, we need to look at it from a lens of what creates the most investable project that can move ahead on a schedule that we all agree is important and urgent, particularly for our gas needs. And that means how do we look at the underlying policy we're creating and the changes that we may propose that will allow this project to move ahead quickly and with clarity from the standpoint of investors. Investors who are gonna look at our project are gonna wanna know, are we ready? Have we supported the infrastructure so that this project, if it moves ahead quickly this fall and this winter as proposed, are the roads ready? Are the bridges ready?

Are the people ready? Are the contractors ready? And so I'm looking at some policy and some changes that I think we'll discuss in this amendment and this bill that are focused specifically on being ready so that investors, when they look at us and they look at this project, they see a state that knows how to do a big project like this. They see people and companies and our infrastructure that has the capacity to support the project, that there isn't a bridge that's all of a sudden not ready to handle the loads of carrying pipe over it. The second is, in that investability, investors are going to have to look at this deal and be able to know that they understand the terms and they see the long-term stability of the terms of this agreement, as has been explained and I think conveyed to us repeatedly, that the industry needs stability in the regulatory framework and the tax framework.

Uncertainty about changes to regulations or changes to tax structures creates doubt. It creates risk for investors on, well, what will happen? Will they change those rates? So I think it's important when we look at this structure that we look at this with an eye towards, is this a reasonable structure that we can anticipate can exist into time for future Alaskans that have to work under the structure we've created. And if we pass a structure today that we look at and say, well, this looks easy and it's awful attractive, but if we look at it and say, you know what, this can't hold up, we can see that there are problems that are going to force us to be causing some of the disruptions that have happened in the industry when we make major restructuring of our policies, I think we need to consider Can we make some adjustments to this so that there is clear, predictable structure for investors to see their return on investment and to see clarity that the policies we put in place are ones that will survive the long-term commitments that they're going to make?

Because they're going to be looking at investments that have 20, maybe 30-year lifetimes to the investment, and they need to say, does this structure we're looking at have the stability for that. So as we look at this, I want to encourage all of us to look at both how do we move this ahead quickly and expeditiously to support the project, to support those that are working on the project, but I want us to be looking through a lens of do the changes and do the policy we're making strengthen our capacity to say, yes, we can do this project, we're ready? And second, can we say to the investors that the structure and the terms that we're offering you and structuring here are good terms that you can rely on. You can make long-term financial commitments and investments in our state and know that those will hold up over time. So I look forward to the work and I appreciate the time.

Thank you. Grifides.

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Will the House please come back to order. We are under debate on Amendment Number 2 to Senate Bill 180.

Representative Kopp. Mr. Speaker, I move Amendment 1 to Amendment 2. There's an objection. Yes, Mr. Speaker, this arises out of a review by some diligent borough mayors who saw that in our attempt to assure that the rising property values along the communities in the pipeline corridor did not skew the required local contribution for education because that's based on property tax value, and that would have an adverse impact on their local budgeting. We inadvertently changed the definition of local contribution.

This change creates an equal protection issue and potentially a vast disparity between school district funding levels. So the amendment simply maintains the needed protection for local budgets while ensuring we don't run afoul of the Constitution. I ask members for a yes vote. Representative Himschoot. Thank you, Mr. Speaker.

I'm in agreement on this amendment. It's a necessary amendment. I hope folks will push the green button. Thank you.

Is there further discussion? Representative Ruffridge. Yeah, thank you to the Majority Leader for this amendment, and thank you to the Education Co-Chair. I think this is a necessary and good amendment to help make sure that all of those things are taken care of. Thank you.

Is the objection maintained to Amendment 1 to Amendment Number 2? I'm not quite sure who made the objection, but there was an objection.

The objection has been removed, so Amendment Number 1 to Amendment Number 2 has been adopted. Representative Kopp. Mr. Speaker, I move Amendment 2 to Amendment 2%. There's an objection. Representative Kopp.

Yes, Mr. Speaker, this is an inflation-adjusted amendment and it allows the alternate volumetric tax rate to be adjusted as inflation goes up. Uh, that was missed earlier. We— this amendment caps it at 2%. It's a reasonable adjustment and it does not adversely affect the project economics. Thank you, Mr. Speaker.

Encourage members to vote yes.

Representative Galvin.

Thank you, Mr. Speaker. Firstly, I'd like to make mention that I have a conflict of interest. I have a deep conflict of interest, frankly. My family stands to gain substantially should this bill at the end of the day, but when it passes. And then secondly, if you would allow me—.

Let me— there has been an objection. Representative Galvin, you'll be required to vote. Okay, then if you'll allow me, I'd also like to speak about this amendment and about the process of getting here, if I may. Thank you.

Will the House please come back to order. Representative Galvin. Thank you, Mr. Speaker. I appreciate that we're on Amendment 2, uh, to Amendment 2 as amended, and if I may, I'd also like to speak about the process of putting this all together, if that's permissible. Representative Gelvin.

I should probably address this at this point. We have a very unconventional process in front of us here with over 22 amendments to one amendment. I've never seen that in my time as a legislator. We're going to do our best to get through this. The underlying amendment is essentially going to be the contents, if that's adopted, of the bill before us.

So it's very hard for me to sit up here and differentiate between comments to an amendment versus comments to the underlying bill. So I feel like since you haven't spoke, you have the ability to— and you've been waiting in line to speak— you have the ability to address the amendment as well as the underlying bill. I find them to be very much intertwined. Thank you, Mr. Speaker. And Mr. Speaker, this will likely be the only time I speak because I think there's so many complicated pieces that we're going to be putting together today.

I'll wait until I know about a particular issue, but my point is I want to echo what we've heard from several of us, including the representative from District 35. I am all about the gas line, and I really encourage us to dig deep today as we look at these amendments to make this the strongest yes and bill. Maybe not yes bet, but yes and bill that we can. I think it's important that we reflect on what we've been hearing from our constituents. And I want to also mention as a member of Finance that for me, we might have missed a beat.

We may have missed the beat in that we had the gas line bill in general, for 1 week, or 2 weeks at the most, 1.5, and then what happened there, sadly, was that the Governor did not send anyone to be with us. We had 1 phone call from DOR, but then we, I was denied getting the modeling that I asked for. That's important when we're thinking about what numbers we should be putting in place here. I think all of the pieces are here, but to understand whether or not it's the proper number, to have that full process is very important. I know that for me, we had a consultant online.

Both times they were on a phone. We could barely hear them. And I really respect the work of Gaffney Klein, very important work. And I frankly would have appreciated having even more contact, and I— and I will say the same for Natural Resources. All of the work that's been done in that committee is very strong.

And then there's still more yet to come. And apparently we're going to try to do all of that today, maybe in the next couple of hours.

So I'm not going to go on and on about it, just to say that typically a major A reform like this for one of the largest projects of our lifetime, of my lifetime likely, would involve a lot more process for all of us to understand the language and all of us to have appropriate study on whether or not we're slipping in the right numbers. That said, Mr. Speaker, I do want to tell you that I'm gonna do my darndest to sit here and listen and try to hopefully With each amendment, I hope I get to hear numbers and backup and a deep understanding as to why this makes sense, because somebody, I guess, has done the real deep research. And then also that we are educated on all the terminology that we are going to be learning, and the public also will have similar education. Unfortunately, before I vote, I won't have time to go back to constituents and have that process as well. Which, as you know, is very near and dear to me as a, um, one who believes that engaging with my constituents before votes is very, very critical.

So I'm just going to leave it at that, and I thank you for the moment of being able to share my concerns on process. Representative Ruffridge. Yeah, thank you, Mr. Speaker. I rise in support of Amendment 2 to Amendment 2. The bill, or the Amendment 2 as drafted, only had a 1% annual adjustment for the throughput tax.

I think there is a space in there where a few years down the road we get a little upside down on what that AVT looks like as adjusted by inflation. I think this goes a long way to adjusting that. I will be in support. Thank you. Representative Mears.

Thank you, Mr. Speaker. I agree with the minority whip that 1% needs to be a little higher, but I will not be supporting this amendment in favor of a later amendment. Thank you.

Any wrap-up comments, Representative Kopp? So the objection is still— the objection is removed. So Amendment No. 2 Is adopted to— there is an objection. You wish to speak to your objection, Representative Freer?

Thank you, Mr. Speaker. As it is, if we have— it's adjusted for inflation using 100% of the average of the annual change over the preceding 5 years for CPI, but it's capped at 2%.

And I object to it being capped at 2%. Thank you, Mr. Speaker. Representative Kopp, did you wish to provide wrap-up comments? Sure, I think the minority whip covered it really well. This going from the current 1% does put us upside down.

That does not keep up with inflation, so capping it at 2% is really much more fair to the whole project, including the recipients, and across the board. Just encourage members to hit the green button.

Are you ready for the— Representative Freer?

I generally don't allow members to—. I know, I'm coming up with a conceptual amendment. Can I get a brief at ease, Mr. Speaker? Brief, brief it is.

Will the House please come back to order?

We have an objection that's maintained. Are you ready for the question? The question being, shall Amendment Number 2 to Amendment Number Amendment 2, pass the body.

Will the clerk please lock the roll?

Does any member wish to change his or her vote? Will the clerk please announce the vote? 29 Yeas, 11 nays. With a vote of 29 yeas to 11 nays, Amendment 2 has been adopt— Amendment 2 to Amendment 2 has been adopted. Madam— well, Madam Clerk.

Representative St. Clair. Speaker, I will not be offering amendment number 3 to amendment number 2. Thank you. Amendment number 3 will not be offered.

Representative— well, Madam Clerk, I think we're going to find a rhythm here. I'm going to turn to you for these amendments to the amendment. Amendment number 4 to amendment number 2 by Representative Ruffridge, beginning page 1, lines 7 through 8 of the amendment. Representative Ruffridge. Thank you, Mr. Speaker.

I move amendment 4 to amendment 2. There's an objection. Thank you, Mr. Speaker. Amendment 4 to amendment 2, it is deleting lines 11 through 26 of amendment number 2, which is dealing with the Alaska Education Fund. Being inserted into the bill, uh, or amendment.

Uh, Mr. Speaker, I think the goal here today, as I understand it, is to try to come up with a— as clean of a bill that deals with the gas line as possible. This amendment was, um, I think initially put in here as a way to, uh, have a, a thought about where the revenue for the gas line, uh, went, or from the gas line went. From my understanding, I think that that is a conversation that we can have potentially another day, and right now we're dealing with the underlying tax structure. And so I'm offering this for the body's consideration. Thank you.

Representative Fields. Thank you, Mr. Speaker. I would strongly urge a no vote on this amendment. This— the Constitutional Education Fund structure in the bill was put in place in the Resources Committee The member from House District 8 offered the amendment. I strongly support it.

I think an underlying issue here is it is imperative that we show the whole state how everyone from the far-flung corners of our state will benefit from this bill. There's no more compelling argument than this provisional language around the constitutionally dedicated education fund. I would note it is conditional because voters would ultimately have to approve the fund if SJR 29 ultimately passes this body and goes to voters. I would also note approval of this amendment will make it harder to get concurrence votes on the other side, and I don't think that's in our best interest. Thank you.

Representative Bynum. Thank you, Mr. Speaker. I just wanted to briefly rise in support of Amendment 4 to Amendment Number 2 for one very specific reason. Although the underlying Amendment Number 2 has this language with the education funding, and the education funding is very important, what we are talking about here, Mr. Speaker, is trying to get a bill where we can get investment in a gas line. The original amendment number, number 2, with having this language in with the education, inadvertently did something very important, and that was that it removed the Alaska Affordable Energy Fund.

And this is a very important part of making sure that non-railbelt-connected utilities and those that are not going to directly benefit from this gas do get a benefit. So I support this amendment because it corrects that wrong. Thank you, Mr. Speaker. Representative Kopp.

Mr. Speaker, I support this amendment, consider it a friendly amendment, because removing this language does nothing to prevent gas line revenue from being put towards education. It simply removes an issue with conflicting appropriations. If removed, the revenue will flow to municipalities via the mitigation fund. It'll flow to the permanent fund. It'll flow to the rural energy fund and ultimately the general fund.

Mr. Speaker, if the voters indeed approve a constitutional education fund, this dedication language can always be revisited. So I support the amendment. Thank you, Mr. Speaker.

Will the House please come back to order? We are under debate to Amendment Number 4 to Amendment Number 2. Representative Galvin. Thank you, Mr. Speaker. Again, in light of the concern for a really good process, I would like— we're going to have these breaks all the time, so many adieeses, because there's a lot of details that need to get vetted through.

And I would just respectfully ask that The Governor's Office will help send us some help. The Department of Law, the Department of Resources, the Department of Revenue would be helpful as we're looking through these amendments. I'm looking through them and I can see that there will be all sorts of questions. And to me, it would make sense that— and I know in the past when we've gone through bills, sometimes there will be a supporter of the bill, but typically we do have someone from departments available to ask questions questions and get clarity. So I will ask for someone from the specific departments if we don't already have it, and if we do have it, then I will start better understanding who is where.

But I want them from these specific departments because these questions will come up. Thank you. Representative Stapp.

Hey, uh, thank you, Mr. Speaker. I'm just going to rise for some clarification on when I'm about to vote on here. I believe it is deleting the language of the underlying amendment to the underlying bill referencing a constitutional amendment that this body hasn't taken up or passed yet, and I think that's what we're doing here. So maybe the maker of the amendment, when he gives wrap-up, can explain to me if that's basically what we're doing. Thanks.

Representative Himschute.

Thank you, Mr. Speaker. I'm working hard to get up to speed on this bill, so I checked in with some people and it sounds like that House Resources in HB 381 had both the constitutionally protected education funding and the 20% to rural energy. The 20% to rural energy is in statute already, and I anticipate another amendment coming forward to clarify that and make sure that it's also here. And so for now, I'm encouraging a no vote on this amendment so that we can protect education funding. Thank you.

Representative Elam.

Thank you, Mr. Speaker. I rise in support of the amendment. I did offer the amendment in the Resources Committee. I did think that it was gonna be something that, you know, many of us would be able to support, but I do think that it adds a layer of complexity that keeps us from having necessarily the clean draft of a bill. We're trying to get a project specifically for the AK LNG project.

And I think that it's really important that we get a good clean bill across with the least amount of complexity that we can so that we can potentially get a good project here. So with that, I do support it. And I'm open to the conversation outside of here in maybe some kind of an additional bill. But for this purposes here, I will be supporting this amendment. Thank you.

Representative Sadler. Thank you, Mr. Speaker. I'll try and keep it quick. I support this amendment to delete the Constitutional Education Fund through the machinations or amendments to the Amendments to the Line Bill. You know, I'm going to examine all the amendments that come across my desk today with a lens of two categories.

One, those that actually help advance and make possible the achievement of a final investment decision to build a gas line. And B, those I call ride-alongs, things that amendments and ideas and allocations that hope it works and assume it works. They'd like to get the— like to add a little piece to it. You know, a constitutional amendment that dedicates revenue from this project before it even happens is in the second category. It's a ride-along, and I don't want to support that.

You know, this amendment would remove that ride-along and keep this train rolling ahead. And not the LNG train, the other kind of metaphorical train. I understand the desire for members to represent their constituents' interests to add to education funding. That's been clear. Been clear for years.

When we get a gas line, we will have lots of money to spend on education or whatever future legislatures decide. Let's not spend the money before we have it. Let's not promise before we get it. Let's not diminish the chances of getting it out of our hunger to get it. So first things first, get a gas line, then we'll get the education money, then we can decide to spend.

Thank you, Mr. Speaker. Representative Schwaggy. Yeah, thank you, Mr. Speaker. I rise in opposition to Amendment Number 4 to Amendment Number 2, partly because I want to protect education funding and make sure that we do dedicate some of the funds coming from this project to education. But I did just want to note that the other reason I'm opposing Amendment Number 4 is, frankly, goes along with the remarks a little bit about— a little bit ago about delivering a clean product.

To the other body. The more amendments we pass, the harder it is going to be to reconcile all of this at the end. And frankly, the harder it's going to be to understand what future amendments do, because you're going to have to refer back to Amendment Number 2 and all the amendments that have been adopted that then amend Amendment Number 2. So it's just in, in terms of complexity, the more we pass amendments, the more complex this whole process is going to be. And so, given that I don't support the underlying concept of this Amendment Number 4 to Amendment Number 2, I'm also going to oppose it because I'm worried about the complexity of this already very complex process.

Thank you, Mr. Speaker.

And wrap up, Representative Ruffridge. Thank you, Mr. Speaker. I certainly don't disagree with many of the comments here today. The truth is, is that putting the language that's in the bill currently, having it stay in the bill, doesn't really affect anything with education funding at all. Truth is, is we would actually have to pass, I believe, one of the bills that's on the calendar today or resolutions on the calendar today in order to have that go to the voters and then establish a constitutional education fund.

Those, those things are all things that we can discuss actually in that bill, not this one. And so I think if there's a— the desire of the body to support some of this money is going to education, is supporting education, that's something that I support. But I think I supported in having that conversation a little down the road, and certainly hope for your votes on this amendment. Thank you. Are you ready for the question?

The question being, shall Amendment Number 4 to Amendment Number 2 pass the body? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote?

Will the clerk please announce the vote? 23 Yeas, 17 nays. With a vote of 23 yeas to 17 nays, Amendment Number 4 has passed the House. Madam Clerk. Amendment Number 5 to Amendment Number 2 will not be offered.

Amendment Number 5 will not be offered to Amendment Number 2. Amendment Number 6 to Amendment Number 2 as amended by Representative Kopp, beginning page 2, line 18. Representative Kopp. Yes, Mr. Speaker, I move Amendment 6 to Amendment Number 2. There's an objection.

I believe I heard an objection up there. Yeah, Mr. Speaker, this is a technical and conforming amendment brought to our attention by legislative legal to make sure that we are correctly identifying the tax abatement language throughout the bill similarly and throughout the structure of the bill. So it's just technical and conforming. Thank you. The objection has been removed.

Is there further objection? Hearing none. There is an objection.

Do you wish to speak to your objection? The objection is maintained. Is there additional discussion?

Any wrap-up comments, Representative Kopp? Yes, again, Mr. Speaker, this just clarifies language. It reflects that property subject to the abatement and the alternate volumetric tax are both reflected under the Title 29 language. The two pieces are reflected together elsewhere, and this just makes it clear throughout all the chapters in statute that this bill affects. Thank you, Mr. Speaker.

Ask members to vote yes. Are you ready for the question? The question being, shall Amendment Number 6 to Amendment Number 2 pass the House? Members may proceed to vote.

Clerk, please lock the roll. Does any member wish to change his or her vote?

Will the clerk please announce the vote? 38 Yeas, 2 nays. By a vote of 38 yeas to 2 nays, Amendment No. 6 To Amendment No. 2 Has passed.

Madam Clerk. Amendment number 7 to amendment number 2 by Representative Holland, beginning page 1, line 8. Representative Holland. Thank you, Mr. Speaker. I move amendment number 7 to amendment number 2.

There's an objection. Representative Holland. Great, thank you. This amendment is drawn from the other body and the work that they had done analyzing the Costs expected to maintain the Dalton Highway. The state has projected that there will be approximately $450 million worth of UGF costs over the next 6 years on being able to maintain and upgrade the Dalton Highway, which will be absolutely essential to this project and to its success.

I think we're all aware of the reports of the condition of the highway in the last year or two and the impact that it had on operations on the North Slope. And you can imagine the potential impact of the heavy loads of the pipe and the heavy equipment that will be required for all of the camps along the way and how that might be an impact on the whole project. As I mentioned earlier in my general— introductory comments, I think it's absolutely essential that we are creating the capacity of our state to be able to ensure that we are ready, that our infrastructure is in good shape so that project components and the project schedule are not slowed down. This is a very aggressive project that cannot afford delays. So this amendment increases the per-barrel tax on the Trans-Alaska Pipeline System to 30 cents per barrel to fund operations and maintenance on the Dalton Highway.

The estimated revenue from this measure would be a little over $50 million a year. Of course, we're seeing some great news in the last few days about the potential flow from the pipeline, but if you look at this as roughly $50 million a year, you'll see that even that is perhaps not enough to cover the total cost that our state will be encumbered to be able to support this project and its success. So I urge members to support this amendment. Thank you. Representative Fields.

Thank you, Mr. Speaker. I'm going to support this amendment primarily because I think it significantly increases the likelihood that we achieve a concurrence vote from the other body. Members are probably aware that there have been extensive committee hearings on both sides. And frankly, I think we're unlikely to achieve a concurrent vote without some form of revenue. This is a logical user fee style form of revenue.

It is modest, um, and I think logically designed. But again, we need this bill to get passed, and there are two chambers. Thank you.

Representative McCabe. Thank you, Mr. Speaker. So this is an oil tax revenue in a gas line bill. I think this is a huge mistake. There are other, the Dalton Highway, yeah, it's going to have some problems with it.

So the other body has a finance committee, we have a finance committee, they can plus up DOT to fix the Dalton Highway if they want. Instead, I think we cut them this year. What about the ferry? The ferry's gonna see increased revenue. We're not going to add any money to that, or they're gonna see increased use from workers coming up here and people moving up here.

What about Ted Stevens International? They're also gonna see a bunch of increased use, as are the roads. The Parks Highway is gonna see a huge increase in use, and yet we're not going to add any money to that. We're specifically focused on the Dalton Highway, and we're using oil taxes in a gas line bill. I'm sorry, Mr. Speaker, the Dalton Highway deserves its own respect.

It deserves its own bill, and frankly, it deserves the funding to the DOT to fix and maintain the Dalton Highway in the proper manner. Not in this bill. Thank you, Mr. Speaker. Representative Kopp. Yes, Mr. Speaker, I rise in opposition to the amendment.

To the amendment, Mr. Speaker, it's a fair discussion about maintenance of the Dalton Highway. However, it is a completely separate issue other than enabling legislation, which this is, for the AK LNG project. I would say I am concerned that it also goes into a much far-reaching area of not allowing oil tax credits or lease expenditures to offset an additional tax on the oil industry. That is, that is a far-reaching implication that we need to be aware of, and that is getting into significant oil tax reform. I think maintenance of the road is a fair discussion.

This legislature should take that up aggressively this next session, but I rise in opposition to this amendment, Mr. Speaker. I think it's just something that's a non-starter in this bill. Thank you. Representative Sadler. Thank you, Mr. Speaker.

I'd hate to be piling on, but I also oppose this amendment. This amendment falls in my second category of ride-alongs. There is mission creep, the creation of designated funds. Our Constitution prohibits us from creating dedicated funds. It took a constitutional amendment to create the permanent fund.

This, in this legislation, is inappropriate. Every.

Function eventually will have its own designated fund and that will diminish the discretion of future legislators who make decisions. I've ridden the Dalton Highway, I've heard many stories about the drivers. It is indeed an essential industrial infrastructure spine for the state. Yes, indeed, there will be demands. If we get a gas line through, we will have revenue to allocate in due course as the future legislatures seem or deem appropriate.

But to do that with a $55 million tax right now is not the right place in the process. So I oppose the amendment.

Representative Mears. Thank you, Mr. Speaker. One of my main considerations in this process is doing what we can to assure that project costs aren't getting pushed down onto the state and local governments. This is a complex amendment and it does it in multiple ways. I will be supporting it.

Thank you.

In wrap-up, Representative Holland. I'm not seeing any—. Thank you, Mr. Speaker. I just want to reiterate the projections by the state of $450 million worth of expenses that will be hitting our unrestricted general fund. If that money needs to be paid and if this project is going forward, we will have to provide the support for DOT to keep this road in good condition.

That means we will be forced to make cuts to other areas, and I don't think we should. I think this is a prudent amendment and I appreciate the thorough vetting that this language received in the other body already. This was not arbitrary. It is not without extensive review in terms of the benefits and the need for it. Thank you.

Are you ready for the question? The question being, shall Amendment No. 7 To Amendment No. 2 Pass the House? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote?

Will the clerk please announce the vote? 17 Yeas, 23 nays. By a vote of 17 yeas to 23 nays, Amendment No. 7 Has failed to pass. Madam Clerk.

Amendment No. 8 To Amendment No. 2 As amended by Representative Hollins beginning page 1, line 10. Representative Holland. Thank you, Mr. Speaker.

I move amendment number 8 to amendment number 2. There's an objection. Representative Holland. Thank you, Mr. Speaker. Amendment number 8 to amendment number 2 is once again drawn from language developed in the other body.

And vetted there in terms of its benefits. In particular, this amendment is doing two things. One is it is providing a price cap on the cost of gas that would be sold to Alaskans and Alaskan businesses. It establishes a price cap of $12 per 1,000 cubic feet before LNG export volume commences, and it establishes a cap of $5 afterwards. These caps protect Alaskans from what are potentially the high costs of this project, but more importantly, they provide assurance to Alaskans, gaining their support for this project and for the potentially short-term sacrifices that are made in order to assure the success of this project.

The producers and the developers of this project have repeatedly given us assurances that these numbers of $12 and $5 are costs that they say we will be able to achieve if this project is in place. Our ability to put the time, the energy, our local commitment to support this project is based upon our Alaskans being able to plan for the benefits of this secure gas supply at an affordable rate, particularly with the LNG exports in there.

The second part of this amendment is clarifying that any sort of cost overruns are limited in terms of what can be added into the total cost of the project when it is then used to calculate the tariff rate that would be used to determine the price of the gas that is charged to Alaskans in this process. I think the amendment's purpose is to provide Alaskans as much of the same assurance and investability that I mentioned earlier that we're trying to achieve for our external investors. We as Alaskans will be investing in the success of this project. We need to see the return on that investment and the work that we're doing. This price cap meets what the developers said could be achieved.

It meets what we are choosing to say, yes, we need this gas and at this price it would be beneficial and that we need to be protected from the price overrun. So look forward to discussion and encourage your support for this amendment. Thank you. Representative Kopp.

Yes, Mr. Speaker, I rise in strong opposition to this amendment. So to effectively set price caps takes the market out, and I want to talk about some of the things this amendment misses. The only reason why we would set a price cap is if we're fearful that we're not reaching export capacity that would ensure probably the $5 MCF. But Mr. Speaker, If we don't go export, we will be importing at a, a very high rate, and that means there's no Alaska revenue, no Alaska jobs, and dependence on foreign energy. And I think that we are far better to encourage our current Cook Inlet exploration, encourage our current other alternative energy sources, rather than say we are going to force the developer to do the job of really what is the RCA.

The Regulatory Commission Agency is the body that these utilities have to go to make their rate-making case and say, this is what is required, you know, for us to provide the energy for communities. We're going around the RCA, we're going around the market, and we're going around the utilities. Utilities are not asking for this amendment. I wanna be very clear. And the only fear that this is based on is that we, is that we may not reach export.

And if we're not reaching export, the imported gas is going to be very expensive that we're depending on. And we currently have the Regulatory Commission as the body that has to set the rates that all the utilities have to have approval for. Let's not go around that process. This would unfairly impact project economics in a way that is completely unknowable, to put that all on the developer to ensure that at this point. So, Mr. Speaker, again, I'm a strong no vote on this.

We have a system in place that utilities make their rate-making case in front of the RCA. This goes around that process. Thank you, Mr. Speaker. Representative McCabe. Thank you, Mr. Speaker.

So let me put this in a little perspective. If you're an entrepreneur and you wanna open a business in a city, say Anchorage, any city really, say you sell hats. The city says, okay, we'll give you a permit, we gotta run it through the assembly first. And the assembly says, well, you can open a business, but you can only charge $10 for your hat. You can't charge $11, you can't charge $12, doesn't matter what it costs you, you can only charge $10 for your hat.

Would you open a business in that city? Thank you, Mr. Speaker. Representative Gray. Thank you, Mr. Speaker. On Amendment 2 to Amendment 2, we were encouraged to vote yes.

Let's cap inflation adjustment at 2%, even though we know that inflation often is higher than 2%. Why do we vote yes on that? Because, well, that adversely affects the Alaskan people. On this one, we're going to— we're voting against a cap because this cap might adversely affect multibillion-dollar corporations. When it adversely affects a multibillion-dollar corporation, vote no.

When it adversely affects Alaskans, vote yes. It's very confusing to me, Mr. Speaker. I am in strong support of this amendment.

Wrap up or— Representative Satter, pardon me. Mr. Speaker, I do not rise to a point of order about impugning. Rather, I rise to speak to the amendment and speaking opposition to it. There's a story. Those of you who have read mythology, King Canute was a very powerful king, and his courtiers said, King Canute, you're so powerful you can tell the tide not to come in.

You can exert your royal authority. Well, you know what? The tide came in anyway. There are natural laws that affect things, and we cannot control them regardless of our royal authority. This amendment seeks to use statutory power to prohibit market operation, to prohibit the market from working.

You know, we have authority in this building, Mr. Speaker. We have authority in this chamber. We do not have the authority to control the market forces, so much as we might like to. And heck, if we're going to say 12, let's make $5. Let's make it free gas.

If we have the power to set prices, let's go all the way. Why stop at $12? No. Representative Beers. Thank you, Mr. Speaker.

Cost overruns have been a concern to me and I'm sure others for quite a while. We had a Wood Mackenzie report presented to House Resources in the last legislature and.

There have been promises from the project that consumers will not be absorbing those costs. I'll be talking a little bit more about some of that in a later amendment if we get to it. But this amendment helps the project keep its promises. Thank you. At ease.

At ease.

Please come to order at this time. The House will stand at ease for approximately 30 minutes.

ទ្ទ្ទ្ ទ្ទ្ទ្ទ ទ្ទ្ទ្ ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ ទ្ទ្ទ្ ទ្ទ្ទ្.

Will the House please come back to order?

We left off being in the middle of debate on Amendment Number 8 to Amendment Number 2.

I'm looking to see if there is more discussion. We've got the sponsor of Amendment 8 before the body. Brief it is.

Will the House please come back to order. Under debate on Amendment 8 to Amendment 2. Is there further discussion? If there's not, I'm going to turn to Representative Galvin. Thank you.

Thank you, Mr. Speaker, and I appreciate that there was someone here from the Department of Revenue for me to be able to ask some technical questions to about this amendment. I will be voting no because, uh, unfortunately what, what I found out was that the floor and the ceiling are too low for this amendment, the $5 and the $12, then they didn't adjust with inflation. And so by the time this gas line gets built, the odds are this, this may be an inappropriate number. So for that reason, unfortunately, I will be voting a no, but I do respect and appreciate the maker of the amendment. Thank you.

Wrap up, Representative Hollett. Thank you, Mr. Speaker. I appreciate the discussion that we've been able to have here on this amendment. This has really been a central part of the public debate for many months now about the discussion about the benefits of this project, and in fact in fact, for many people, the messages they've heard about what sort of price of gas they can expect to have from this project. And the interesting thing from my standpoint is that the developers of this project have made it very clear, and I appreciate their perspective, that they need very firm fixed pricing on the terms for the property tax.

And before the amendment, they were looking for a fixed number. On that, uh, new tax. And so it's, um, a little bit challenging on one hand for the developers who are investors. We're saying we're going to give you a fixed cost without worrying about inflation for 10, 20, 30, 40 years of this project. And yet to Alaskans who are also investors in this project and who have had expectations set and who are making choices, uh, on their own part about investing that For them, we're saying, no, you're gonna have to just kind of pay what we think you ought to pay at the time.

And that's not the message that the public has gotten. They've been promised some affordable gas from this project, and I am hoping that they will get that. This is essentially recognizing that Alaskans are investors beside the commercial market investors. We both are putting a lot into this project. And while it might be interesting to think of this project as a free market activity, um, the member from Big Lake kind of mentioned the idea that You know, you wouldn't expect a business to have a price cap on it.

But you wouldn't expect a business to have been subsidized for decades with over $1 billion. And it would be arguable to say that this is right now a market-based project. We are trying to move it ahead despite having the firm market purchase contracts that would be there. This is clearly a project that is taking advantage of and depends upon a balance between public investment and private investment and trying to create the conditions in which both sets of investors view this as a good deal. The private investors want some fixed prices and some controls on their prices, and I think it's fair that the public investors, those of us that have paid for this project over the last couple decades, have the same terms available to them, some firmed, fixed, understood pricing terms so that they understand what they're getting.

We're just creating a level investable playing field for everyone who's in here. So why shouldn't Alaskans have the same benefit that this bill is offering the investors and the developers? I think they should. I think this amendment provides that parity of investment commitment. Thank you.

Are you ready for the question? The question being, shall Amendment 8 to Amendment 2 pass the House?

Will the clerk please lock the roll?

Does any member wish to change his or her vote?

Will the clerk please announce the vote? 14 Yeas, 26 nays. By a vote of 14 yeas to 26 nays, Amendment No. 8 Has failed. Madam Clerk.

Amendment No. 9 To Amendment No. 2 As amended, beginning page 4. By Representative Holland, beginning page 14, line 20. Representative Holland.

Mr. Speaker, I will not be offering this amendment at this time. Amendment number 9 will not be offered at this time. Madam Clerk. Amendment number 10 to amendment number 2 by Representative Holland, beginning page 2, following line 20 of the amendment. Representative Holland.

I move amendment number 10 to amendment number 2. There is an objection. Representative Holland. Thank you, Mr. Speaker. This amendment, I think for all of us, is perhaps the most important amendment we ought to consider.

The— just a brief adieu, please. Brief adieu.

Will the House please come back to order with Amendment Number 10 to Amendment Number 2 before the body. Representative Holland.

Thank you, Mr. Speaker. Amendment number 10 is a sunset on the tax abatement that this project would enjoy at a point at which the project had been in full production for 10 years. Currently, the project, as we know, has a volumetric tax that is based upon the flow through the pipeline that is offsetting the standard 20 mil tax that was originally in place. And at the point at which this project has been in production for 10 years, we would go back to that original property tax basis and the terms that have allowed this to become attractive for the investors and for them to have 10 years for getting a return on their investment. They would be able to know that there would be this adjustment.

And I view this as important from two perspectives. One is that It's important for the investors in this project to know what the future tax expectations will be of this project. And it's, I think, reasonable to expect that if we provide them a very competitive, attractive price at the beginning of the project, that if they're smart investors, they will know that at some point in the future, we're gonna come back and say, that was an awfully good deal you got. But we will make changes. And we know how much that upsets the investability of projects when there isn't clear assurance long-term on what the tax policy will be on a project.

This provides clarity that I think they need and we need that the taxes foregone in the near term to help this project succeed and for the investors to get a return on investment, that there is a point at which there is a sunset on these taxes. And we could certainly renegotiate and work on those down the road, but this creates clarity for us as investors and for the developers as investors. In fact, this policy is what we've seen in Texas and Louisiana. This is not new policy. This is what is established as good public policy on supporting projects that need the help getting started, but long-term need to be able to revert back to standard customary tax policy that allows consistency across the state.

So look forward to discussion and encourage your support of this 10-year repealer on the tax abatement. Representative Cobb. Yes, Mr. Speaker, I stand in strong opposition to Amendment 10 to Amendment Number 2. The previous member spoke about giving the investors some predictability. Raising the tax rate tenfold in 2 years from the volumetric tax rate back to the 20 mil property tax rate is not investment predictability, stability, and would make the project unfinanceable.

For that reason, I strongly oppose this amendment. Representative Josephson.

Thank you, Mr. Speaker. Mr. Speaker, recalling what the member from the heart of Midtown Anchorage said about wishing that there had been more opportunity to really engage with the bill, I know that may sound possible to the public, but if a bill isn't before you and you're in this building 12 hours a day, that may be as much time as you can reasonably commit. This amendment strikes me as very reasonable. It may be a little longer than I might want, but it just, it just appears to me that if you're in production for 10 years and you're shipping gas to Asia and everyone is reaping the benefit of that, um, I appreciate what the Majority Leader said about predictability, but If this passed, it would be predictable because it would have passed. And everyone would know that 10 years from first gas, this would be in place.

I just, I note that the lack of exposure to the bill because I don't know, I wasn't privy to the hearings where mayors testified about impacts on roads and police and fire and schools and public health. And I don't know whether the local governments know what's coming at them.

And the bill also says that the state will pick up part of that to the tune, I guess, of $90 million. So the bill has a sort of second community assistance fund, effectively. I just think this is reasonable. 10 Years is a long time to be earning those sorts of profits. And then to revert back to the world as it was seems reasonable.

And so I'm going to support Amendment 10 to Amendment 2. Representative Ruffridge. Thank you, Mr. Speaker. I rise in opposition to Amendment 10 to Amendment 2. Sadly, this project, in order to become viable, requires long-term commitments, much longer than 10 years.

And so any change that we make to this that is short duration, which would be a 10-year change immediately in the middle of those contracts, I think, would upend the, uh, the project. Mr. Speaker, natural gas and oil are two very different types of projects, and I do want to disagree very strongly with the member that spoke right before me. I think we all knew when we came here, Mr. Speaker, that this was going to be on the table. I also think when we came to Juneau, we knew that this was going to be on the table. Mr. Speaker, I have not had any of these bills in front of any committee that I sit on But I think I and many others have taken the time to know that this is going to be a thing we're going to have to talk about at some point, and I've made sure that we took the time to understand those, uh, nuanced elements of the bill so that we could have this discussion that we're having here today.

So I will not be supporting that for the reasons that I mentioned. Thank you. Representative McCabe. Thank you, Mr. Speaker. A couple things.

The property tax abatement is not something you enjoy. It's something that we offer for you to come build a pipeline in our state. We say we recognize that our taxes are a little too much. We want you to come in. We recognize that you wouldn't be able to make any money enough to get off the ground and build this pipeline.

We want you to come here and build this pipeline, so we offer it. You don't necessarily enjoy it. This is not a subsidy, despite what I heard earlier. We're starting to conflate or confuse the difference between a subsidy which is something that we pay them out of public money and a tax relief or tax abatement. Frankly, we have never paid oil companies or gas companies out of public money.

We have never subsidized them. We've given them tax relief, we've given them tax credits, we've given them all sorts of things. We have never paid public money for an oil company to come in here. That's a subsidy. Mr. Speaker, in regards to the comment about what's coming at our boroughs, So increased population.

People are going to buy houses and pay taxes on those. Their kids are going to come and go to school. They're going to get increased school funding through increased ADMs. Increased churn in the businesses. The businesses, small businesses, entrepreneurs are going to love this because more people are going to be shopping at their businesses, Mr. Speaker.

So my question is to those people that think that this is going to hugely impact our cities and boroughs is What if the impact is positive? What if the impact is a net positive? Are the boroughs and cities that are positively affected by having increased population— remember, we've had outmigration for 13 years now, so we bring in more population and it's a net positive impact— are they gonna put money into the state fund, into UGF for this, Mr. Speaker? So maybe seem a little irritated, but The conflation of the terms that is going on on this floor right now to motivate people against a certain— against this project, frankly, is exactly what I was talking about in my very first comment on this floor. We are trying to make money right now, and this is a 100-year project.

It's not a 10-year project. It's not even a 20-year project. This pipeline will be around for 100 years. These are known reserves, and this pipeline is going to tap those known reserves, and it's, it's a sure bet. Vice is drilling somewhere that is not a sure bet.

I think we need to keep in mind what exactly the terms are that people are talking about and understand clearly what we're trying to do here, which is a tenfold increase in 2 years. What business, what entrepreneur would ever consider doing that, Mr. Speaker? Representative Stepp.

Yeah, thank you, Mr. Speaker. I am going to rise in opposition to the amendment, but I want to put on the record the amendment does things, uh, that I don't know were explained, and I'm just going to ask the maker of the amendment to maybe talk about them. So page 1 of the amendment adds a new section to the bill It basically inserts 4356, that's municipal tax, the ability to levy. On line 16 on page 12, lines 25 and 26, it changes the definitions from natural gas project. My understanding is currently that entire section of page 12 has already been deleted from the underlying amendment, but I'm not entirely sure because it's still in this amendment.

On page 12, following line 30, We add some other definitions in Section 23. That's on page 2 of the amendment. I believe that's relevant to the Alaska Gas Line Development Corporation, but I'm not entirely sure how it works in the existing AGDC language of the amendment. There's a lot of other things, but I'll leave it there and just.

I say you shouldn't have a sunset, and if people want to come back and rug pull them on the taxes, a future legislature could do that at the time. Thank you, Mr. Speaker. Representative Gray. Thank you, Mr. Speaker. I rise in support of this amendment.

Permission to read from the amendment? Permission granted. If you go to page 6, 10 years after the date of commencement of commercial operations of liquefied natural gas, or January 1st, 2050. I just— I mean, it's going to— I'm not an expert on this, but I think it's going to take some time for us to get that liquefied natural gas plant in Nakiski up and running. So that's none of this.

None of this applies until it's up and running. And then once we've got that fully $20 billion plant up and running and we are shipping natural gas out and selling it all over the world, that's when the clock starts on that 10 years, and it might be 2050. And I think in 2050 it might be fair to allow people to take a look at the taxes and make some changes. This is not an unreasonable amendment. I will be voting yes.

Representative Galvin. Uh, thank you. Once again, this would be a great one to fully model and vet because it kind of makes sense, and yet it kind of doesn't to me. I could imagine that we would maybe ramp up from the point of production. There's a lot of things that happen in other natural resources and this isn't the same as everyone.

I get all that. But I think what I'm going to do is I'm going to vote along with this one and I'm going to say that I lean in with the U-Med District representative that I guess we'll have to amend or make changes as we learn more down the line. But I do think it's important to stake something in the ground that says let's make sure that we're— it's not that I— again, I support this gas line, but I do think we need to make sure we're doing our due diligence also to make sure that our communities are looked after. So I will be supporting this. Thank you.

Paris.

I'm going to go to Representative Holland for wrap-up comments. If there's not further discussion, Representative Holland. Great, thank you, Mr. Speaker. I appreciate the discussion and the questions. The underlying question about kind of the structure of this amendment, just offer that this amendment and all the language coming into it has come from the work done in the other body that has thoroughly modeled the repealer language in order to identify those sections that were creating the original property tax reductions and creating the conforming repealer language to reverse that so that after 10 years and full production that we would be returning back to the same fair landscape that all other projects are expected to.

I'd just like to note in wrap-up here that You know, I've been involved in investing in businesses now for about 12 years, and the number one rule in working with investors is consistency, that you have to provide consistent terms that they expect to see, that they know what is happening and they know what will happen in the future with the investments that they make. This repealer and this 10-year approach is consistent with other investments going on in the states, including Texas and Louisiana. Our investors know what to expect. They know what's coming, and they would expect this. They would not expect to see an indefinite property tax reduction.

That's creating uncertainty because it's creating terms that they don't see in other places, and that puts the project at greater risk. At the end of the day, again, I'm still focused in on how do we create a clear, compelling, investible project, investible by Alaskans and investible by external investors. The cost of this property tax reduction to the producers in 10 or 20 years will become a rounding error in the huge volume here, but it will become essential revenue for our communities and for our constitutional obligation to make sure that we develop our resources for the maximum benefit of Alaskans. That's what I'm asking you to do here, is to look for future Alaskans in the next generation and other projects that will come in the future. Thank you.

I encourage you to vote yes on this amendment. Are you ready for the question?

Brief it is.

Will the House please come back to order?

The question before the body is shall Amendment Number 10 to Amendment Number 2, pass the body. Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to change his or her vote?

Will the clerk please announce the vote? 18 Yeas, 21 nays. By a vote of 18 yeas to 21 nays, Amendment Number 10 has failed to pass. Madam Clerk. Amendment Number 11 to Amendment Number 2, as amended by Representative Josephson, beginning page 16, line 30 of the amendment.

Representative Josephson.

Mr. Speaker, I will not be offering this at this time. Amendment Number 11 will not be offered at this time. Madam Clerk. Amendment Number 12 to Amendment Number 2 by Representative Josephson, beginning page 1, line 9. Representative Josephson.

Breathe it ease, please. Breathe it ease.

Welcome back to order. Representative Josephson.

Thank you, Mr. Speaker. I move Amendment 12 to Amendment 2. There's an objection. Mr. Speaker, I'm told, uh, that this amendment may be— trying to think of the right word— acceptable to this, the underlying sponsor.

The underlying amendment adds a community impact fund of $40 million to be funded by the project developer at the beginning of the project. It's intended to reimburse local communities for their actual costs and impacts related to hosting a massive construction project over years before there is gas flowing that will pay any taxes. The problem is this fund is administered by the developer themselves with the money remaining in their accounts and the community somewhat dependent on their goodwill. And what could be— we're unsure of the decision-making process, an element of arbitrariness. Now that's pejorative, but I don't know what— how the money would be doled out.

In the other body, they have a similar fund in their version of the bill, but it's administered by DCCED, And as people know, DCCED has been modeling, has language that is modeled more like the NPRA Impact Grant Fund that they've been administering for years, distributing federal royalty shares from the NPRA to impacted communities. So what Amendment 23, or sorry, 12-2, Amendment 12, I don't know where 23 came from, Amendment number 12 to Amendment 2 aims to do is to mirror the existing NPRA grant distribution system, turning the impact grant into something managed by DCCAD. The money is the same, the type of community needs being covered are the same, but it would mean the money is in the state's hands up front to ensure a fair and transparent process. I ask for your support. Representative Kopp.

Yes, Mr. Speaker, I do support this. I've confirmed with the developer that this is an administrative burden that they frankly be glad to not have to be responsible for. The state is set up to do competitive impact grants. We do it all the time by community need and severity of effects and causal links to certain activities. So based on confirmation that this is an administrative headache to the developer and they're very happy with this amendment, I have no No problem with it.

I support it. Brikidiz.

The House, please come back to order. Mr. Majority Leader, I think I will turn to you in the middle of the debate. We have, uh, I think it's timely for you to—. Yeah, thank you, Mr. Speaker.

Just a point of information, uh, for the body. We have an agreement, uh, with the administration that the Office of the Chief Clerk of the House will remain available until 11:59 PM Alaska time today, May 18th, for the purpose of receiving official gubernatorial transmittals, including any veto message or related transmittal concerning House Bill 78. The Clerk's Office will accept any such transmittal delivered through the ordinary and accepted methods used for official communications between the executive branch and the House of Representatives. Any transmittal received before 11:59 PM Alaska time will be accepted, logged, and marked as received as of the time of receipt, and the clerk's office will not decline receipt of a gubernatorial veto transmittal on the basis that it is transmitted near the close of the day, provided it is received before 11:59 p.m. Alaska time. This confirmation is provided to ensure an orderly process and a clear official record.

Thank you, Mr. Speaker. Thank you, Mr. Majority Leader. Further debate on Amendment Number 12 to Amendment Number 2? Representative Rupperidge.

Thank you, Mr. Speaker. I rise in support of Amendment No. 12. I do think I have a slight concern with it. However, it doesn't really change the underlying, I think, issue here.

And that is sometimes as the legislature, when we may appropriate things, it takes us a little extra time. But I also think this is something that the developer would have to stand up a whole other organization to do, and we already have a way to do that. So I will be supporting it. Thank you. Representative Stapp.

Yeah, thank you, Mr. Speaker. I'm kind of agnostic on the amendment, if it passes or does not pass. I just want to say my understanding of the amendment is the— basically money would be transferred from the developer operator of the line and put in a DCED. That would basically make that grant subject to future appropriation. And there is a chance that the legislature may not appropriate that money if you pass this amendment to the affected communities as they are supposed to.

So people should probably know that. Thanks.

The objection has been removed. Not hearing further objection, Amendment No. 12 To Amendment No. 2 Is adopted. Madam Clerk.

Amendment No. 13 To Amendment No. 2 As amended by Representative Josephson beginning page 12, line 28. Representative Josephson.

I move Amendment 13. There's an objection.

Mr. Speaker, we've all been looking at various taxable events. Is the taxable event when X amount of product is shipped to market. Is the taxable event when folks in Alaska are enjoying natural gas like never before and hopefully, hopefully at a relatively affordable rate? Here the bill says that even when gas begins to flow, albeit in smaller quantities, so the product's already— or rather the I guess some of the treatment— I'm told there's a lighter form of GTP than the full GDP. At any rate, the pipeline is certainly built.

The project is absolutely underway. And the AVT doesn't commence for 5 years. So the underlying amendment includes a tax-free period at the beginning of the project. As I said, it would not have to pay any AVT until either 5 years after first gas or when volume exceeds half a billion cubic feet per day, which would likely mean getting LNG exports started. So the project is fully enriched.

I don't mean it's been fully amortized. I don't mean that every, every screw and bolt and sheet of metal has been paid for, but it's going to be because the quantities are there, the customers are there. The committee substitutes in both bodies resources committees. Removed the tax-free period, which means the tax would take effect at first gas. So I want to say that again.

Both resources versions said that the ABT would begin on day one, uh, once any form of production begins. In practical terms, Mr. Speaker, the volume of gas produced in the early years will be relatively small, just satisfying in-state needs. If all.

Gas currently consumed in the rail belt were shipped through this project and paid the AVT, admittedly, it would raise just $5 to $6 million in annual revenue, which would be the total amount to be shared between the states and municipalities. Now, you may say, why, why do I care about $5 to $6 million? Well, why is $5 to $6 million critical to the developer? After all, there's, there's no other impact aid for these municipalities. I mean, there's these, these discretionary impact aids where you show your receipts and etc.

There isn't any practical reason to deprive the state of revenue during the early years of service. This amendment would help set up the processes that will be needed to distribute this revenue, so we'll have any issue ironed out about how that works before the larger volumes and larger numbers come into play. I ask for your support of Amendment 13. Representative Ruffridge. Thank you, Mr. Speaker.

I rise in opposition to Amendment 13. I think we just discussed actually a large community relief fund of $40 million. That is certainly going to have to come from somewhere. I think that that is coming from the developer in this case, and a lot of that reason is that's an upfront issue, just as the speaker from District 13 was mentioning. But that is, in many ways, a large part of asking for that abatement up front is to say there's gonna be a long stretch of time there where we're in process, building mode, and we're gonna need an abatement until we have gas flowing.

I think we go far enough in Amendment No. 2 Underneath of it with a $40 million community impact fund, and taxing them on top of that would seem unnecessary, and I will not be in support. Representative Kopp. Yes, Mr. Speaker, I rise in opposition to Amendment 13 to Amendment 2. The, the 5-year temporary tax abatement during construction is absolutely critical.

To be taxed at the 20 mil tax rate is basically stops the project. They can't finance it without this predictable structure in there. This type of relief gets it built. It's during a time when there's no money coming in. The members have a DOR revenue chart.

It shows the first 5 or 6 years the project is just getting going, and then you hit year 6 and all of a sudden you're up to $800 million in revenue to Alaska. As the member from District 30 has said, several times, a little patience and we have a lot of revenue coming in. But this, this basically strips out all the incentive of the developer to have a window of time to get this project built and online. It is one of the largest mega construction projects energy-wise in the world. Thank you, Mr. Speaker.

In wrap-up, Representative Josephson. Well, just that there may be some confusion. I'm not talking about the construction phase. I'm talking about the production phase. So at line 16, page 1 of the amendment, upon commencement of commercial operation of the gas pipeline component, the tax abatement would be suspended and the— I guess it's 10 cents weighted average VMT or AVT would begin.

I just think that's reasonable. You—.

It can't be, it can't be that it's a substantial deterrence to pay the state this modest amount of money when they've already built their pipeline. And I guess treating the gas to some degree, as I understand it, So it's usable. So I just think it's a reasonable amendment. I ask for your support. Are you ready for the question?

The question being, shall Amendment Number 13 to Amendment Number 2 pass the body? Members may proceed to vote.

Clerk, please lock the roll. Does any member wish to change his or her vote? Will the clerk please announce the vote? 16 Yeas, 24 nays. By a vote of 16 yeas to 24 nays, Amendment Number 13 to Amendment Number 2 has failed to pass.

Madam Clerk. Amendment Number 14 to Amendment Number 2 as amended by Representative Eichide, beginning page 1, line 10 of the amendment. Representative Eichide. Mr. Speaker, I move Amendment 14 to Amendment 2. There's an objection.

Mr. Speaker, this amendment just ensures that the project sponsor would charge the state no more than $12 per 1,000 cubic feet of gas during Phase 1 of the project, and then not more than $5 per 1,000 cubic feet in, uh, once Phase 2, once the LNG export facility is operational. This is not really a restrictive amendment. This amendment simply enshrines in statute verbal commitments that were made in both resources committees by the project sponsor and actually by the exec himself. They've said that if they receive these tax breaks, that they would be able to— they would charge no more than the rates I just said. So I think this is a reasonable amendment, just holding people to their word.

Thank you, Mr. Speaker. Representative Kopp.

Thank you, Mr. Speaker. I rise in opposition to this amendment for the same reasons I stated in Amendment Number 8 to Amendment Number 2. This setting a cap on gas prices is basically a statement based on a statement of the developer that yes, if they go to export, this is the range we could expect. This was never an in-state gas price. It was always understood the prices would be higher if it was in-state only.

Our advocate for price consumer fairness is the Regulatory Commission of Alaska, which has to set the rates that the utilities come and ask for. They're the rate-setting agency. And so whether it's Enstar or any other public utility, they have to go through that process of justifying a rate. These rates, as the member from Anchorage has said, yes, that is what we expect to pay. Fantastic when we get to export, but that is not what we're looking at if it's in-state only.

Thank you, Mr. Speaker. Representative Ruffridge. Yeah, thank you, Mr. Speaker. No need to add to that. I agree with the comments from the Majority Leader and urge members to vote no.

Thank you.

Brief it is.

Yeah. Will the House please come back to order? I believe we have completed the debate on Amendment #14 to Amendment #2.

In wrap-up, Representative Eichide. Thank you, Mr. Speaker. Well, you know, I was a teacher and I held people accountable for what they said. And this amendment just holds the project sponsors accountable for what they said on the record. It creates expectations.

And there's an old saying, say what you mean and mean what you say. They create the expectation that this would create affordable gas for Alaskans. So I would like to hold them to their word and I would ask for a green button for gas. Thank you, Mr. Speaker. Are you ready for the question?

The question being, shall Amendment Number 14 to Amendment Number 2 pass the body? Members may proceed to vote.

Clerk, please lock the roll.

Does any member wish to change his or her vote? The clerk, please announce the vote. 16 Yeas, 24 nays.

Nays. By vote of 16 yeas to 24 nays, Amendment Number 14 to Amendment Number 2 has failed to pass. Madam Clerk. Amendment Number 15 to Amendment Number 2 is amended by Representative Hemmschulte beginning page 1, line 5. Representative Hemmschulte.

Amendment 15 will not be offered. Amendment Number 15 will not be offered. Madam Clerk. Amendment Number 16 to Amendment Number 2 is amended by Representative Mears beginning page 1, line 10. Representative Mears.

Thank you, Mr. Speaker. I move Amendment Number 16. There's an objection. Thank you, Mr. Speaker. Commissioner Reed.

Commissioner Granite. Thank you, Mr. Speaker. This amendment is about consumer protection for cost overruns. The Wood Mackenzie report from November 2024 had a cost estimate of $10.8 billion for Phase 1. I'm just talking about Phase 1 here.

That seems like an awful low number for what we've been talking about, but that's got real impacts to Alaskans. That number included 20% contingency. Recently been told that the cost for Phase 1 will be in the mid-teens. That includes a preliminary gas treatment plant on the North Slope. The potential for cost overruns is very real.

We've been hearing regularly in-house resources about some general factors that cause very large projects to have cost overruns, as well as some specific specific factors for some real projects that have been happening for LNG projects recently in the world. These factors include remote construction, unfavorable weather, tight labor markets that drive up wages. We certainly have some other big projects going on right now. Material costs that are higher than planned. A year ago, we were looking at tariffs raising prices on materials, and now we're looking at energy costs that not only drive up the cost of materials, but how we get them year.

And also projects that were not thoroughly planned ahead. The more planned out your project is, the more on budget you will be.

I've been told not to worry about cost overruns impacting customers. Early on, I was in a private conversation and told, don't worry, the contractors will take that risk. Mr. Speaker, I've been working in the construction industry for a couple of decades now, and Contractors eventually get their money, whether it's, you know, an upfront bidding a little higher to assume those risks, and change orders do an awful lot for making sure that we don't drive our construction industry out of business. More recently, we've been told that the investors will take the risk on that. Mr. Speaker, I've not seen updated numbers and certainly nothing with details or backup.

We don't have clarity on how the RCA will make decisions on how costs from an overbuilt project will be affected in customer— allocated in customer rates in Phase 1. So we are looking in Phase 1 at building a project the size for export. We don't have clarity on that process. What this amendment does, the least— is the least we can do. It is a real ceiling of $15 billion that Alaska ratepayers may have to bear on Phase 1.

There's only so many of us and only so far that'll go. This'll— that's still a lot of money if all these costs get brought to Alaska ratepayers. So all it does is it puts a ceiling on that and it limits risk to our customers. Thank you.

Representative Kopp. Yeah, Mr. Speaker, I rise in strong opposition to Amendment 6 or Amendment 16 to Amendment 2. Mr. Speaker, again, as we said in previous similar amendments, the regulatory commission agency enforcement on rate setting is intact. This project, if it has an overrun— I mean, most of us had heard in Energy Committee or in Resources Committee the head of our utilities company say the project economics regardless, we are only concerned about one thing, and that is protecting the consumer, the ratepayer, and the RCA is the authority to set that rate. We don't have to put it in this bill and, and say we're doing the job of the regulatory commission agency.

We are only adding an unnecessary liability to the project developer and going around the process we already have in law to protect consumers from somebody who can't control a project cost. And for that reason alone, Mr. Speaker, and the uncertainty that does to the financing of this project, I would strongly recommend a no vote. Thank you. Representative Ruffridge. Yeah, thank you, Mr. Speaker.

I rise in opposition to Amendment Number 16. I think one of the main reasons why we want to, uh, be in opposition to Amendment 16 is, uh, for all the mentioned reasons mentioned by the Majority Leader which is that we have an organization that protects the consumer in the state of Alaska, namely RCA. Also, if there is massive cost overruns, the project as a whole doesn't meet the purpose for what it's being built for, which is exporting natural gas. So there will be an incentive, I think, to make sure that those costs are down. Thank you.

The House, please come back to order. We are under debate on Amendment Number 16 to Amendment Number 2. Representative Galvin. Thank you, Mr. Speaker. I appreciate the time to check in with the Department of Revenue, and also it allowed me to come to some certainty with this particular amendment.

While I very much appreciate the maker of the amendment trying to make sure that any cost overruns will not be passed off or cost shifted over to consumers, I believe that there are a couple problems with this amendment. And the reason I will not be voting for this amendment is that in line 10, where we see $15 billion, uh, already, uh, the Department of Revenue was working with the nominal estimate of $16.6 billion. So we would already be over the amount, which makes this very confusing. And the other thing I want to mention is that the agreement between AGDC, the state, and Glenfarm is already somewhat protected with regard to our first 25% that we already know we have in terms of investment in this pipeline. And so what that means is that with the— written in the promise that's already been now, I guess it's part of the contract and stated publicly, so that part, that much we know, is that that 25% is protected and they may not defer those costs onto the state of Alaska and our consumers.

And the other thing I would like to mention is that if the state decides to invest separately— so I think we've been told already that we may choose later down the line to invest up to 25% more— that portion will not carry the same guarantee. They will carry varying risks depending on the investment and depending on the negotiation of that— at that time of that agreement. So I do want to mention that because I think there may be some question down the line. We hear a lot about RCA will take care of us. Well, the cost will have to go somewhere, and I know that we're protected right now, and so I think it's a really important conversation down the line if we choose to invest separately, but for this particular time, I think this amendment is not a good fit.

Thank you.

Further debate?

And wrap up, Representative Mears.

Thank you, Mr. Speaker. I've kept up with most of everything here, but the last few days have been a bit of a blur, so work that's been happening in House Finance and the other bodies, Resources Committee, has been a little challenging to follow. It's a surprise for me to hear that we are now at $16.6 billion on paper estimate for Phase 1. A year and a half ago, we were at $10.8 million. These are the numbers just on paper.

They don't take into account the factors that I mentioned earlier for potential cost overruns. Yes, the RCA has the responsibility to protect consumers, but they also need the tools from us to be able to do that. We've been making those inquiries. What happens in a scenario to do with a— with infrastructure that is overbuilt for a future project and how those costs get allocated to current consumers. When we're looking at the case of an electrical line or a natural gas distribution line and the scales that we've got now for our residential and our in-state customers now, that is much smaller.

$16.6 Billion on less than a million people and only a fraction of those that are on the rail belt and will be the customers is a lot of money. We are already seeing that the cost of this project for Phase 1 can break the backs of Alaskans. We need those protections. Having an amendment to just put a ceiling there is the minimum that we can do to help protect our customers.

I am not here to protect the project developers over that of Alaskans. I hope folks support the amendment, and if not, then I hope there's other things that we can do to help protect Alaskans from cost overruns. Thank you. Great. Are you ready for the question?

The question being, shall Amendment Number 16 to Amendment Number 2 pass the body? Members may proceed to vote.

Will the clerk please lock the roll?

Does any member wish to change his or her vote? Will the clerk please announce the vote? 17 Yeas, 23 nays. The vote is 17 yeas to 23 nays. Amendment number 16 to amendment number 2 has failed to pass.

Madam Clerk. Amendment number 17 to amendment number 2 as amended by Representative Freer beginning page 2.

Page 16, line 30 of the amendment. Representative Peer. Thank you, Mr. Speaker. I move Amendment 17. There's an objection.

Thank you, Mr. Speaker. Amendment 17 terminates the tax treatment of the bill if Phase 2 hasn't begun construction by 2034. If Phase 2 hasn't begun construction by 2034, then AVT is repealed. This amendment expands a section already in Amendment G.15 that repeals AVT if the first 730 miles of pipeline haven't begun construction by 2032.

Representative Kopp.

Thank you, Mr. Speaker. I stand in opposition to Amendment 17 to Amendment 2. This adds a second sunset trigger. As we know, there's already a sunset trigger of January 1st, 2032 if pipeline construction hasn't started. So this amendment would add a separate condition on Phase 2 starting.

In other words, if Phase 2 hasn't started by January 1, 2034, then the tax abatement stops. But Mr. Speaker, I think that, uh, the uncertainty in the world right now, dynamics, if we have a Phase 1 project which would include a gas treatment facility and a pipeline, the developer has— and the economics demand that a pipeline of this magnitude go to export to really make sense. So all we're doing here is we're saying you basically have a 24-month window from the time you can lose your tax abatement on phase 1 to losing it again if you're not exporting in phase 2. To me, that is, that is an assumption that would introduce financing uncertainty into this project significantly, knowing that now there is a very short window where all the tax abatement can go away on a massive export facility if they can't complete this in this additional 24 months. And I don't believe this has been part of any committee bill, and for those reasons alone, I urge a no vote on this amendment.

Representative Mears. Thank you, Mr. Speaker. I actually think this amendment supports the developers' narrative of the expediency of this project, and I'll be supporting it.

Further debate? Representative McCabe. Thank you, Mr. Speaker. One of the reasons that the state struggles to find financing in that contractors and builders and project managers struggle to find financing in this state is because of the volatility in our state that we create. Frankly, we create in this building and, you know, other things create it as well.

But then there's also the world market to think of, Mr. Speaker, and there's the dangers of shipping and weather and any number of things that could prevent or put a limit on export. And I'm just concerned that putting a cap on it without anything for relief, such as weather or, you know, some sort of a hostile— maybe the tankers don't want to run hostile area. Maybe— who knows what goes on. I just think we're putting an artificial cap on this with no relief at all. Thank you, Mr. Speaker.

Wrap up, Representative Freer. Thank you, Mr. Speaker. I just want to note that we heard a while— there are only 9 members in the House that serve in House Resources Committee. We did hear a number of— we had a number of hearings with the project developer about what their expectations are, and they shared with us in committee that their intent was to proceed along with AGDC, proceed with Phase 1 and Phase 2, if not simultaneously, as close as simultaneously as they could. This doesn't put a point on when export happens.

This is when construction begins. So all this amendment says is construction begins by 2034, and I urge support for this amendment. Thank you. Are you ready for the question? The question being, shall Amendment Number 17 to Amendment Number 2 pass the body?

Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to change his or her vote?

Will the clerk please announce the vote? 20 Yeas, 20 nays. By a vote of 20 yeas to 20 nays, Amendment Number 17 has failed to pass. Madam Clerk. Amendment Number 18 to Amendment Number 2 will not be offered.

Amendment Number 19 to Amendment Number 2 will not be offered. Amendment number 20 to amendment number 2 by Representative Ruffridge, beginning page 7, lines 2 through 4. Representative Ruffridge. Thank you, Mr. Speaker. I move amendment number 20.

There's an objection. Thank you, Mr. Speaker. Amendment number 20 actually does a number of things, so I'll ask permission to just read briefly if I can. Permission granted. Thank you.

There was a lot of mention of AGDC in the underlying amendment. This amendment seeks to clean up some of the more troublesome portions of that dealing with confidentiality and subsidiary and management terms, project economics and cost disclosures. If you want to follow along with me, the confidentiality waiver on— this is on the amendment 70, G.76, lines 1 through 7, and this is going to require all parties to agree rather than may agree to waive confidentiality for publication. So this is narrowing the public disclosure, has a more controlled release, and less direct publication authority. The next portion of the amendment on G.76 is lines 9 through 12.

This is removing a transparency guardrail for arrangements that would indirectly expose the state to risk. Lines 17 through 20, there's a deletion there, deleting material. Again, this has to do with subsidiary ownership and management terms. This allows more confidentiality around subsidiary structure.

Moving along to page 1, line 22. This is again changing some of the language of the underlying amendment to allow that the legislature and the public would be assured that there is a state interest option but not necessarily the details. Mr. Speaker, I think part of the, uh, AGDC language in the underlying amendment would really inhibit AGDC from making some of the investment opportunities— that is, the 25% of the state share of the project— without complete legislative approval, which would delay potentially those decisions. Moving on, there is on page 2, lines 2 through 9 The language there of the amendment reduces the minimal— minimum financial information that are available to legislators.

Moving on to, uh, this is on page 2, lines 11 through 21. This is actually a relatively major shift in the amendment away from legislative approval to legislative veto or passive approval. This, Mr. Speaker, is sort of the bulk of the amendment and makes it easier for AGDC to act, especially when we are not in session. Again, moving on to page 2, lines 23 to 29 of the amendment, this removes the upfront legislative approval of the option terms and allows the legislature to still approve the acquisition later, but not the option itself. This is on revenue-generating projects options.

Timing of notice is dealt with on page 3, lines 1 through 3. This actually strengthens the legislative notice timing and the legislative— legislature gets notice sooner. Page 3, lines 12 through 15, we're going to be in this amendment deleting that and the underlying amendment. And this is dealing with required cooperation and testimony with AGDC and its partners. Lines 17 through 20 on page 3, Mr. Speaker, deals with another relatively significant area of Amendment No.

20. And this is requiring bond issuance approval by the legislature. Again, this is removing AGDC's ability to have bonding authority on their own. In the underlying amendment, the amendment to the amendment restores AGDC's ability to do that without legislative financing control over AGDC. Ownership change is dealt with on page 3, lines 23 to 25.

And this makes notice obligation subordinate to a confidentiality agreement, meaning that there has to be one in place. There's some definition changes on page 3, lines 27 through 29, and some technical and conforming changes on page 4 through page 5, mostly technical. Mr. Speaker, this amendment narrowly.

Describes some changes to AGDC. The underlying amendment was more broad. These disclosure requirements really does actually still implement legislative approval over certain aspects of AGDC, but rather than broad sweeping changes in the underlying amendment, these are more narrowly tailored. There is legislative access to information and state options, but the triggers are not so grave as to endanger the project, and I urge your support.

Representative Kopp.

Yes, Mr. Speaker, I concur with the remarks of the member from District 7 from Soldotna. This, this amendment really balances transparency with the commercial process. It does not— it's certainly more restrictive than what we have in the law now. For those that want to see more transparency, this amendment provides that. It doesn't go as far as the Senate Resources Committee did, but it certainly would allow, Mr. Speaker, the Alaska Gas Line Development Corporation to preserve confidential information while providing necessary information to state policymakers for for the state to make an informed investment decision.

It does still require AGDC to require— to communicate with the legislature on a timely basis about investment opportunities and include a timeline that meets the needs of the legislature and privately led development project of the Alaska LNG. So again, the disclosure of confidential, commercially sensitive project information. That could competitively harm the project and their ability to strike agreements, um, is mitigated against in this amendment. But the disclosure necessary for the legislature to make informed decisions is protected. And for those reasons, I strongly support this amendment.

Thank you, Mr. Speaker. Representative Mears. Thank you, Mr. Speaker. Uh, this amendment further narrows our our already limited transparency and our limited authority, I will not be supporting it.

Representative McCabe. Thank you, Mr. Speaker. We set up the AGDC for a purpose. We set them up just much like we set up AHFC, Alaska Railroad. We set up a number of corporations and entities in the state to do a job.

And now we're going to tell them, well, we want you to do a job, but we want to be in control. This is micromanaging by this body or by this building at its finest, Mr. Speaker. And, and while I understand that they're going to make mistakes— every business makes a mistake— I can't think of a worse group of people. Not impugning, but we are a group of 60 trying to make decisions for a legislative body that we set up to make decisions on their own. So why don't we just do away with them?

We have them in place to do something. I think we should let them do it. Representative Gray. Thank you. I rise to a question.

So on page 1, uh, the party— sorry, permission to read. Permission to read. The parties to a confidentiality agreement may agree to waive confidentiality to allow the release of information for publication. For publication has been deleted in the inserted lines. So I mean, I'm just just the question is, is like, we— there's no way to publish the information that we get?

Is that the intent? So journalists have no rights? I, I'm just curious. Thank you. Representative Pollard.

Thank you, Mr. Speaker. Um, I want to align myself with the comments from the speaker from South Muldoon, but I really want to come back to this overarching theme, which is we want to create a project environment that is more investable, more predictable, and more successful. The Amendment Number 2 that's being amended by this amendment was already created, I'm assuming, with full understanding and full concurrence with the project developers and the state executive to what they viewed as a prudent improvement in project transparency. And I think it is obvious to, I hope, everyone that One of the underlying challenges of this project has been the continued challenge of whether or not we're having sufficient transparency and access to information to understand the project risks, the project terms. And in this case, the project developers, and I believe being a part of this underlying, number two, they came to us offering what they felt were reasonable new terms to provide some greater assurance.

And I think we should welcome that. I don't think we need to reverse that with this Amendment 20. So I urge you to vote no on the amendment to reverse the agreement that is found in the underlying amendment that we're voting on. Sorry, I got— that almost got confusing, but I understood what I said. I would urge you to vote no, please.

And wrap up, Representative Ruffridge. Yeah, thank you, Mr. Speaker. Um, well, I think that really this under— this amendment to the amendment does one thing. It says, are we, uh, wanting to balance business and transparency? And one of the things to the speaker that was just before me, I think we've been asking for transparency, but I think we might have been asking for the wrong question.

The question that we've been asking is, how are you going to do this? What are—. What is your profit margin? How are you going to make money? How much money are you going to be taking?

And the right question should be— the right question should be, would you be able to come here and build a project at all if we don't put some sort of property tax abatement in place? That's really what the underlying question that we have with Amendment Number 2 before us is, do we as a legislature want to make property tax abatement and a lower property tax available to a potential producer to produce long-term viable cheap energy for Alaskans? After that, Mr. Speaker, after we make that decision, then we get to start asking all the questions. And to the member from Big Lake, we did exactly that when we set up AGDC. We said, here are the tools to go and make sure that we can get some sort of viable project, and we want you to do it so that we don't have to.

Mr. Speaker, I do not have a long history of oil and gas tax policy, but I do know that there are a lot of people within the state of Alaska who do. They've made it their living. A lot of them are actually employed by and work around AGDC. And so I think if we want to give them the tools to go out and do business, we should. But we should also protect sometimes those really I think distinct components of a project that might need to be kept confidential if needed.

Our decision here today is do we want to try to have this project go forward and to push forward a tax abatement in order to incentivize that thing to happen? And then some of those things that we're trying to discuss here, I think, fall well outside of asking that very simple question, and I urge your support for Amendment 20. Are you ready for the question? The question being, shall Amendment No. 20 To Amendment No.

2 Pass the body? Members may proceed to vote.

The clerk, please lock the roll.

Does any member wish to change his or her vote? Representative Jimmy, a yay to a nay.

Representative Freer, from a yay to a nay.

Will the clerk please announce the vote? 22 Yays, 18 nays. With a vote of 22 yays to 18 nays, Amendment Number 22, Amendment Number 2 has failed to pass. Madam Clerk, brief at ease.

By the hour. So Amendment Number 20 has passed the body. Is the brief at ease still requested? Brief at ease.

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Will the House please come back to order?

I'm going to call a very brief at ease here because I think we're missing a member or two.

Madam Clerk. Amendment number 21 to amendment number 2 as amended by Representative Freer beginning page 1, line 6 of the amendment. Representative Freer, did you wish to roll this to the bottom? Is that—. Yes, please, Mr. Speaker.

Okay, number 21 to a 2 to the bottom. Madam Clerk.

Amendment number 22 to Amendment number 2, as amended by Representative Holland, beginning page 1, line 8 of the amendment. Representative Holland. Thank you, Mr. Speaker. I move Amendment 22 to Amendment 2.

Amendment number 2222. Representative Holland. Great, thank you, Mr. Speaker. Amendment number 22 is a familiar topic for us. This is a topic that relates to the taxation of pass-through entities including S corps, LLCs, and partnerships.

This application of this The policy is directed specifically within the confines of the single subject of this bill to oil and gas firms. It focuses in on those firms over $1 million in taxable income. You can find that on page 321 if you want to see how that's structured. Right now, as I think most members may understand, the primary structures that are related to this project, including The project developer, Glen Farn, and the 8 Star Alaska organization created under AGDC are LLCs, are not taxable under our current tax policies. That means that the profits that would come from these organizations will not flow into our general fund.

And once again, we perpetuate the Alaska disconnect that allows us to create profitable businesses that we have to seek different ways of trying to understand and create revenue to support our schools, our roads, and the infrastructure that are so vital to those organizations. I look forward to the discussions and the debate on this topic once again. I also would suggest that once again, this is a topic that has undergone significant discussion and review through the other body with their bill. And once again, I am seeking not to overly burden this bill, but I'm seeking to align ourselves with an effort that would reach a policy document in whole that would reach a consensus in order to move ahead. Thank you.

Representative Fields. Thank you, Mr. Speaker. I do support this amendment, number one, because I support passage of the underlying bill, and I think it is a a simple reality that this bill needs to pass two chambers, and I think adoption of this amendment would greatly increase the likelihood the bill passes two chambers. Number two, I want to talk about the substance of this amendment. As the speaker before me mentioned, right now when we have economic growth, we don't necessarily have additional revenue to provide for public services, and that disconnect explains a lot of our problems with outmigration.

I think this amendment is a modest way of dealing with it, and just to give one very simple example, if the various S-corps and LLC in the Glenstarn constellation of companies were very profitable, as I hope they are. When they were profitable, they would pay a small increment of money and to fund the public services that their employees use in our community. I think that would be a win-win. Representative McCabe. Thank you, Mr. Speaker.

Well, here we are again trying to stuff an oil tax bill into a gas line bill. I understand the motivation. I disagree with it. The problem that we are having, that everybody that's concerned about LLCs and S corps is having, is that virtually every lawyer, every dentist, every doctor's office is currently an LLC or an S corp, and we would never be able to get a clean fix to this loophole through. So instead, we're trying to leverage an oil company again.

And Mr. Speaker, if we want to change the law, if we want to change the S corp law, if we want to change the LLC law, then we should do it in its own law. The problem is, is we will never get support to do that. And so instead, we're targeting an industry, a— and frankly, one company in an industry, um, right now. And I think it's a mistake, Mr. Speaker. Let's fix the law.

If we want to fix the law, let's do it. Let's not try to stuff it in a gas line bill. Representative Kopp. Yeah, Mr. Speaker, I rise in opposition to Amendment 22 to Amendment 2. Mr. Speaker, so tax policy discussion is fair.

It's a very fair discussion. I mean, how do we treat S corps, LLCs, partnerships, sole proprietorships? Fair discussion. Does it belong in this bill? No.

And what really concerns me, Mr. Speaker, is that This is once again being referred to as closing the Hilcorp loophole, and as we all know, Hilcorp is drilling at least 27 wells this year in Cook Inlet, trying to find enough gas to extend the timeline under the urgent circumstances that at the same time we're trying to get this AKLNG gas line coming down to us. The only thing that can provide enough room for us to not be enrolling brownouts is the success of that business, who is the largest operator in Cook Inlet. We know that their drilling program is well over $100 million a year just in Cook Inlet, and their CAPEX expend in Alaska approaches a billion. And we also know that if they hadn't come and taken over BP's assets, BP was on their way out the door. Big harvester.

Hilcorp's ability to find more gas and rejuvenate fields has significantly extended and actually increased the production of oil in the line, increased the gas we have available to heat our homes. And I, I don't like going after an entity that came here in good faith to Alaska when we knew what that tax structure was And now we're saying we're desperate to squeeze another $100 million out of you and we're going to do it in a gas line bill. I think the discussion is a fair one. It can always be had, but it should be had separately. Thank you, Mr. Speaker.

For those reasons, I'm a strong no vote. Representative Mears. Thank you, Mr. Speaker. As a reminder, we are stuffing a gas line bill into an LNG import facility bill. So we're already stuffing.

I'm here for that. But I want to remind us also that The whole gas line discussion has got a new corporation coming into the state of Alaska that is another pass-through entity in the oil and gas industry.

I don't— my understanding is that as when we got rid of the income tax here in the state, this was not a business model that was used on these large entities. As we are having an expansion of yet another large company into our state in this space, they needed to be treated the rest of our— as the rest of our C corporations. It is unequal business practices. We need to fix it, and I will take every opportunity to rectify that. Thank you.

And we'll wrap up. Representative Holland— Representative Mr. Gray first. Thank you, Mr. Speaker. Obviously I rise in support of this amendment. I won't repeat my remarks from earlier, but I will just ask folks to think of a hypothetical.

Think you lived in a different state and you discovered that you had a tremendously valuable treasure in your backyard. It was worth a ton of money and it was deep down in there, and you had different companies that said, hey, we'll help you get that treasure out. You would not spend all your time thinking like, Well, what I'm here to do is help you. I want you to get that out and I want you to sell it for the highest amount so that you make the most profit. Yeah, you can take my treasure and you can sell it and make a profit, but I get some too.

And do you know why? Because it's my treasure. I'm letting you sell my treasure and I want to get my share of that treasure because it was in my backyard. That's what this is about. Don't call it the Hill Corp loophole.

Call it the Glenfarn loophole. It goes in this bill. Thank you, Mr. Speaker. Representative Satter. Thank you, Mr. Speaker.

I wish to remind members of the concept of the royalty. Royalty is a 12.5% or a 16.25% royalty that the landowner gets when you find oil or coal or natural gas in your backyard. You get that. The state gets that money. It's called a royalty.

Mr. Speaker, I fear I've excited somebody. Representative Satterthwaite.

You are supposed to direct your comments to the speaker, not to the member next to you. That's not observing the decorum. Brief it is. Brief it is.

Will the House please come back to order. Representative Sadler, I'm going to recognize you. Thank you, Mr. Speaker. In the interest of quorum, I will acknowledge that perhaps my comments were not appropriately directed, and if I caused inadvertent offense, I do apologize. Thank you for that.

We have Amendment Number 22 before the body. Amendment Number 22 to Amendment Number 2.

And I'm looking to see if there's additional discussion or debate. I do not see any. Microphones raised. To the maker, Representative Holland, wrap-up. Great, thank you, Mr. Speaker.

I appreciate it once again, the questions and the discussion here. You know, I'd like to touch on a couple key things. This S corp tax legislation we're talking about today is targeted at a narrow set of companies as defined within the bill. That is a limitation because of the single subject topic and working with Ledge Legal and drawing from the work that's been done in the other body in here. You know, if I had the opportunity, I would, and this is with, you know, many folks in my district that are asking for us to do a better job of supporting the expenses and revenue we need for our state.

But this is the narrow room that we have to work with in this bill, and I'm offering this as a way to provide this offset. I think it's really important for us to understand And if we go back to the documents provided by the maker of the amendment, you will recall that that chart at the last page shows that we're going revenue neutral— or excuse me, revenue negative in the first years. Because as this project rolls on, the development costs of this project are actually going to be reducing some of the taxable income of other corporations that are at work here. This S corp is in discussion about increasing the revenue is meant to try and help us offset the negative consequences that we're going to see at this point. I think this is a responsible way for us to balance the overall revenue impacts of this project and ability for us to protect our responsibility to be able to fund the other services our state needs, as well as managing our resources to the greatest benefit of Alaskans.

I am urging members to vote yes on this amendment. Thank you.

Are you ready for the question? The question being, shall Amendment Number 22 to Amendment Number 2 pass the body? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 18 Yeas, 22 nays. With a vote of 18 yeas to 22 nays, Amendment No.

22 To Amendment No. 2 Has failed to pass. Madam Clerk. Amendment No. 23 To No.

2. Will not be offered. Amendment number 23 will not be offered. Amendment number 24 to amendment number 2 as amended by Representative Freer, beginning page 2, following line 10 of the amendment. Representative Freer.

Uh, thank you, Mr. Speaker. Uh, I'd like to ask to roll this to the bottom. Okay, amendment number 24 will be rolled to the bottom. Madam Clerk.

Number— Amendment Number 25 to Amendment Number 2 by Representative Hollins, beginning page 1, line 9. Representative Hollins. Thank you, Mr. Speaker. I move Amendment 25 to Amendment Number 2. There's an objection.

Thank you, Mr. Speaker.

Amendment number 25 is a important part of the language that I've looked at with this bill. A lot of it is drawn from experience and working in other investments and looking at the fundamental question of what exposure does an owner participating in an investment expose themselves to by virtue of the project or the business that they're investing in. This amendment is a way to define a broad set of limitations on the exposure that we Alaskans might find ourselves saddled with in terms of obligations, commitments, or at.

End of the day, unmet expectations, as you will find at the last section of the amendment. I think this is a prudent section of language to protect ourselves. And once again, under the framework of trying to ensure that this is a more investable project, that everyone is clear on their investment and the obligations to be able to see this thing move ahead quickly. Efficiently and clearly. It is a set of language that the way it's constructed for purposes within this underlying amendment and the bill would be applicable to the state of Alaska.

But the intent as we drafted it was to provide some model language that we hoped would provide a framework that municipalities, boroughs, and other entities that might choose to become an investor in this project would see a model for the language that they might want to consider in order to protect themselves and the residents within their local jurisdictions. So I urge you to consider carefully and to see both its value in protecting Alaskans, providing clarity to investors, but also helping our local jurisdictions that might want to pursue being an investor and part owner in this project. Thank you.

Representative Ruffridge.

Yeah, thank you, Mr. Speaker. I'm going to rise in opposition to Amendment Number 25. I actually think that this amendment maybe highlights the reason why building projects sometimes in the state is very difficult, especially highlighting why maybe this project hasn't moved forward in a long, long time. Uh, the intent here is essentially saying that the legislature will hold some sort of discretion over the entire project, it's relatively sweeping. And I think on its face would prevent any sort of effort made without having the government essentially run the entire project.

And I think that that would be oppositional to the intention of trying to get this project to the finish line. I will be not in support.

Representative Kopp.

Thank you, Mr. Speaker. I, I rise in opposition to Amendment 25 to Number 2. One of the challenges of industry investing in a mega project in Alaska is because our Constitution does reserve to the legislature to do these very things in that Tax law is subject to review by subsequent legislature, so it's very hard to get the commitment of investment in Alaska. Here in this amendment, we're actually doubling down on what the law already says, but we're saying and projecting that we are very fiscally unstable as a partner. And I would just point members to page 3, lines 9 through 15.

Where the amendment says the state reserves full authority to amend, modify, repeal, exempt, or any other provision of law relating to AKLNG. Okay, okay. And then it says that if we do that, the project cannot make a claim of detrimental reliance on the law that we passed to enable them to get this. And we know, Mr. Speaker, that they are going to be investing $50 billion, $60 billion. So if we're basically have an amendment that doubles down on what our law already permits, is that the legislature may amend things as we go along, that does not send a good signal to industry that we're telling you right now that the minute we pass a bill, we are going to change it the next day.

So again, This language is already in our Constitution. We're already permitted to do this. I think this sends a wrong message to industry, and at a time when we are trying to attract the investment necessary for this project to be successful, they need to see our legislature is behind this project and that we are not trying to upend the rules of the game the minute we have passed an enabling legislation. Thank you, Mr. Speaker. Representative McCabe.

Thank you, Mr. Speaker. Once again, this is why projects fail in Alaska. This is why businesses fail in Alaska. Mr. Speaker, I've looked at a number of contracts in my life, in my day. This is a contract.

This is us trying to have a contract that we have an entire department called the Department of Law to look at. We have other regulations, other statutes to look at, and now we're saying, well, that's not good enough. The lawyer— or the legislature wants to be the lawyers now. Not only do we want to manage the project, Not only do we want to do everything else with the project, but now we're going to do the contract. To me, this is, uh, this is a huge overreach that doesn't belong in this body.

We have a department to do these kinds of contracts. This is why small businesses fail— too restrictive of a contract. Thank you, Mr. Speaker. Representative Stapp. Oh, thank you, Mr. Speaker.

Um, I'm just going to echo the comments of the Majority Leader. I like this amendment because I entitled it the Rug Pull Amendment, Mr. Speaker. It's basically, if you invest in Alaska We reserve the right to change the terms of the agreement even if we ourselves enact our own investment trigger in the ATG LNG project, which I think is kind of amazing. So I'm going to be a no vote. Representative Gray.

Thank you, Mr. Speaker. Um, I think what we're hearing is, you know what, we got to lock it in. We got to lock it in for the next 100 years. That's what we're here to do. We're going to do it right here on the floor.

We're going to figure out the terms and lock it in for 100 years. Whereas there are many people in this room who have been witness to the exact same conversations I've been, where I've had some discomfort about us making these decisions right now in a rushed, pressured environment and saying they have to be firm and forever, or else we're not good for business. And what people who are part of this negotiation have said is, you know what, we'll do the best we can and we'll tweak it next year. They're literally saying that to me to get me on board. They're saying we'll tweak it next year and we'll make it better.

But what I'm hearing on the floor is no, we can't tweak it next year. You get on board now. We're locking it in for 100 years. I will be supporting the amendment. Thank you, Mr. Speaker.

In wrap-up, Representative Holland. Thank you, Mr. Speaker. I am fundamentally aligned with and agree with the maker of the underlying amendment. The powers that are available that this amendment that I'm offering are ones that are reserved for the state. They are reserved for the legislature.

And it is important for us as being essentially the sophisticated prudent investor in this discussion to be able to be clear with those who are going to enter into contracts with us on the nature of who they're making a contract with. And I think they get that. It is that underlying ability for us to change in the future that I hope we don't need to exercise because we have been prudent, we've been diligent, we have disclosed fully who you're doing business with and what our rights and our obligations are so that we are both motivated to come up with a good, fair deal now. To me, it is a paradox that on one hand we would be told that we have lots of flexibility to tweak it later, and then on the other hand we're told, but don't tell anyone, we can tweak it later. Which is it, folks?

Are we going to be clear and disclose to those that are doing business with us the nature of their agreements, or are we not going to say it and just hope they figure it out? Again, though, I want to draw back to the original framing of this. This does provide clarity. Particularly for folks that may not know the full scope and flexibility that we have and the powers we have and why it's so important we get this right. But also, as this potential project rolls down to local jurisdictions, we're going to be dealing with local folks that may not have the benefit of all of our lawyers and all of the due diligence that we can do.

They need to know what their protection should be, what clauses and protections should they make sure are in the agreements that they enter into as an investor so that they don't find themselves having made an investor— investment, excuse me, that seems attractive but find there's obligations that they didn't know to protect themselves for. So I think this language both discloses the reality of making an investment with a state government like we are, but it also helps inform those that will be doing derivative or subsidiary investments with us. So I urge the body to support Amendment 25. Thank you.

Are you ready for the question? The question being, shall Amendment No. 25 To Amendment No. 2 Pass the House? Members may proceed to vote.

Will the Clerk please lock the roll? Does any member wish to change his or her vote? Will the Clerk please announce the vote. 17 Yeas, 23 nays. By a vote of 17 yeas to 23 nays, Amendment Number 25 to Amendment Number 2 has failed to pass.

Madam Clerk. Amendment Number 26 to Amendment Number 2 will not be offered.

Amendment Number 27 to Amendment Number 2.

By Representative Tomaszewski, beginning page 2, following line 10. Representative Tomaszewski. Thank you, Mr. Speaker. I move Amendment 27 to Amendment 2. There's an objection.

Thank you, Mr. Speaker. Amendment 27 is a simple amendment. This amendment accomplishes two goals. It exempts spurn lines from state property tax and authorizes authorizes municipalities the ability to fully or partially exempt local property taxes from the current— from the spur lines. Under the current structure, these tax burdens would ultimately be passed on to consumers through higher energy costs.

This amendment aligns with the broader goal of the LNG project, which is delivering more affordable energy to Alaskans. Every community should have the opportunity to benefit from the LNG project, not just those located along the mainline. I ask you for your support.

Representative Fields. Thank you, Mr. Speaker. I just want to note that this would exempt from property taxation spur lines to large industrial projects, meaning that homeowners would pay more in very large projects would not pay for the infrastructure associated with the energy that they consume, and I would urge a no vote.

Representative Ruffridge.

Yeah, thank you, Mr. Speaker. I am going to rise in opposition to Amendment 27. I think that there is an opportunity here for municipalities, actually under a different subsection already in Title 29, to exempt or partially exempt oil and gas properties. And so I believe that Amendment Number 27 is not needed. Thank you.

Representative McCabe. Thank you, Mr. Speaker. I love this amendment. So we're talking a spur line already in Clear. It's in my district.

We're talking about it in Anderson, which is a city. We're talking about a spur line for Cantwell, Denali, Willow, Talkeetna, Trapper Creek, All of those are in my district. That's a fabulous thing, but I will probably be voting no. Representative Stapp. Thank you, Mr. Speaker.

I'm gonna rise in support of this amendment. I think it's an important amendment. Obviously, this is a big issue for the interior in our town, the second largest town in Fairbanks, and I think we have an obligation and responsibility to ensure that the second largest town in Fairbanks is also a recipient of the gas because the main line of this project skips the town by 30 miles. Thank you.

Representative Kopp.

Yeah, Mr. Speaker, I, uh, I can see this amendment, uh, two different ways, but the way I'm mostly focused on, I don't think it impacts the project economics, and I do see it giving some local control of municipalities So, Mr. Speaker, I ask for a brief at ease on this. Thank you. Brief at ease.

Mr. Speaker, I'd like to place a call on the House until the completion of the amendments. Representative Tom McCabe, I appreciate your quick rising to the occasion, but I would like to convene the House before— You just did. Well, usually I like to make the comment of calling the House into order. So the call has been placed on the House until Thank you, Mr. Speaker.

Until the amendments to this bill are complete. Until the amendments to this bill are complete. That means everybody in the gallery too. No, refus.

Will the House please come back to order? I think the call has been satisfied or near satisfied.

I think we've got every member here, in fact. So we are in the midst of debating Amendment Number 27. It's been introduced. Representative Kopp, do you wish to speak to it? Yeah, Mr.

Chair, I had called at ease actually originally going back on this, and I will not be supporting the amendment, but I do want to say it, it does not affect the project economics. Thank you, Mr. Speaker. Okay.

If there's no other conversation, Representative Tomaszewski. Thank you, Mr. Speaker. Thank you for everyone being here. I'll just state it plainly. This amendment accomplishes two goals.

And one is the— gives the— authorizes municipalities the ability to fully or partially exempt spur lines from local property taxes. We don't know, like the member from District 30 mentioned, we don't know who is going to build a spur line. We don't want those communities to be burdened. And we don't want them to not have the ability to give tax relief to their local customers because the broader goal of this LNG project is to deliver more affordable gas to Alaskans. And that means all Alaskans.

This isn't just Fairbanks. This is to all Alaskans. Please support the amendment. Thank you. Are you ready for the question?

The question being, shall Amendment Number 27 to Amendment Number 2 As amended, passes the House. Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to choose his or her— to change his or her vote? Madam Clerk. 7 Yeas, 33 nays. By a vote of 70 yeas to 33 nays, Amendment Number 27 to Number 2 has failed to pass.

Madam Clerk. Amendment Number 28 to Amendment Number 2 by Representative Tomaszewski, beginning page 14, following line 29 of the amendment. Representative Tomaszewski. Thank you, Mr. Speaker. I move Amendment 28.

There's an objection. Uh, thank you, Mr. Speaker. This amendment eliminates the throughput tariff on residential homeowner.

The whole point of this project is not only to provide energy security for the state of Alaska, to our nation, and to our friends across the oceans, but it's also to keeping utility bills lower, um, and helping provide more affordable housing. By passing this amendment, we are relieving homeowners of an additional energy cost.

The reduction in the Thoroughput tariff is minimal to the overall project, but will have larger benefits for individual families. Thank you. Under debate. Briefities.

Will the House please come back to order. Representative McCabe, I'll call on you first. Thank you, Mr. Speaker. I'll lift the call in the House. Call has been lifted.

Mr. Majority Leader, I believe you were about to speak to the amendment.

Yes, Mr. Speaker, I rise with a question for the maker of the amendment. I'm just not quite certain how this tax relief would be computed. And so I see that the taxpayer signs, or note, signs an affidavit that the gas they're using is for residential use. I'm just trying to figure out how this tax relief is different than any other residential user that is has the benefit of a utility feeder line, whether it's coming off the main line or off the spur line. And I don't want to do something that is going to only benefit a certain region unless we can figure out how this would apply to all residential users in this tax break.

And unfortunately, I I just need to get my mind around it. So right now I'm not supporting it, but I'm very open to figuring out how this works. Representative Mears.

Thank you, Mr. Speaker. I appreciate the concept here that we're reducing taxes on our, you know, additional costs on the residential ratepayers. I don't see how feasibly this can happen with the method here, or really just about anything else that can come to mind. I appreciate the thought. I don't think it's executable.

I won't be supporting the amendment. Representative Henning.

Thank you, Mr. Speaker. I too raise with a couple of questions to the maker of the amendment, trying to make sure and understand if he means only in-state users versus an export buyer who might be selling to residential companies, customers upon their location, and if it's gas sold to your utility, then let's say NSTAR needs to differentiate between its customers from residential uses versus commercial users. And so those are my two big questions, whether it's only residential users in Phase 1 of the project or if it extends to Phase 2 and export customers who would be residential users by export agreements.

Representative Josephson.

And another thing I think, Mr. Speaker, that has not been taken up by colleagues in the last two members is that this would appear to reduce the AVT received by local governments. I think that's the point of it, and I question whether that's been modeled How would the local governments who are already receiving less revenue, substantially less revenue under the bill, how would they then compensate for even an additional decrement to their revenue? If the sponsor could respond to that, that would be great.

In wrap-up, Representative Tomaszewski. Thank you, Mr. Speaker. I appreciate all the, uh, dialogue, but the overall goal of this pipeline is not only to supply Alaska and our nation with energy security, but also reduce the price of energy for residential use customers within the state. And that's what this amendment attempts to do. That is the intent of this amendment.

How a utility will determine what gas they're using in for residential.

Use. It's on a spreadsheet, Mr. Speaker. They know how much gas is going to residences of the state in their particular utility. Uh, they know how much commercial gas. This just helps to lower the price for residential property users, and I appreciate your support.

Thank you.

Are you ready for the question? Question being, shall Amendment Number 28 to Amendment Number 2, passed the House. Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 6 Yeas, 33 nays. By a vote of 6 yeas to 33 nays, Amendment No.

28 Has This failed to pass. Madam Clerk, Amendment Number 29 to Amendment Number 2 is amended by Representative Tomaszewski, beginning page 20, lines 12 through 13 of the amendment. Representative Tomaszewski. Thank you, Mr. Speaker. I move Amendment Number 29.

There is an objection.

Mr. Speaker, thank you. Amendment 29. Is a very simple amendment. This amendment has a briefities, Mr. Speaker. Briefities.

House, please come back to order. Amendment number 29, Representative Tomaszewski. Thank you, Mr. Speaker. Amendment 29, Mr. Speaker, is a simple amendment. Currently, the bill excludes communities with spur lines from sharing in the, uh, project mitigation fund when appropriations to the fund exceed $60 million.

This amendment removes this exclusion. The pipeline is intended to benefit all Alaskans. Communities outside the mainline should not be placed at a disadvantage or excluded from sharing in the project's benefits. I appreciate your support.

Mr. Majority Leader.

Yes, Mr. Speaker, I definitely appreciate the advocacy of the representative from Fairbanks for the district, but, um, Mr. Speaker, I rise in opposition because the reason for this language in the underlying amendment to only applying to the third $30 million tier of appropriation— so in other words, in the first $30 million, Fairbanks Fairbanks does get their share of that, and the second $30 million, they do get their share of that. But if the legislature approaches between— appropriates between $60 and $90 in a community impact, the reason why that language was inserted, my understanding, and those on House Resources could correct me, but it's because the tariff that Fairbanks enjoys is carried by the entire system. All communities keep that tariff affordable for Fairbanks. That is spread every utility payer in the Mat-Su Valley, in Anchorage, all the way down the peninsula. Everybody is making sure the Fairbanks utility payers pay a reasonable rate.

In other words, it was agreed that it would be a system-wide tariff. So we— that's, that's quite a benefit. I I understand the advocacy, but for those reasons, I won't be supporting the amendment.

Any closing comments, Representative Tomaszewski? Thank you, Mr. Speaker. Thank you for that.

And Mr. Speaker, so from $0 to $30 million of this, of the project mitigation fund, the first $30 million is divided equally between the 6 boroughs. The second $30 million is divided equally between the Kenai Borough and the North Slope Borough. So that's $15 million each. The third $30 million, the $60 through $90 million, is divided to the boroughs again, except for those who have had a spur line to their community. Mr. Speaker, that removes Fairbanks from that.

Now tell me, Mr. Speaker, This is an appropriation. It's a yearly appropriation up to $90 million yearly from now until the end of time.

Why would a legislator in the future from Fairbanks appropriate more than $30 million to that fund?

There's no benefit for the members from Fairbanks. The members from Fairbanks would maybe do that out of the kindness of their heart, but maybe they wouldn't. So Mr. Speaker, this is a simple amendment. The last $30 million is distributed between the 5 communities. Fairbanks should be one of them.

Fairbanks deserves that opportunity. From next year and the year after and the year after. And I would appreciate the member body's support. Thank you. Are you ready for the question?

The question being, shall Amendment Number 29 to Amendment Number 2 pass the House? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 8 Yeas, 32 nays. By a tally of 8 yeas to 32 nays, Amendment No.

29 Has failed to pass. Madam Clerk. Amendment No. 30 To Amendment No. 2 As amended by Representative Josephson, beginning page 16, line 30 of the amendment.

Representative Josephson. I move Amendment 30 to Amendment 2. There's an objection. Thank you, Mr. Speaker. Mr. Speaker, Amendment 30 is a revised version from previous version 11-2, 11-2 Amendment 2.

The underlying amendment, that is Amendment 2, does have a termination section saying the AVT goes away if the project doesn't begin construction by 2032. But it's unclear what would then happen in that instance at that moment. My amendment clears this up in two ways.

In one particular way, one way. It makes sure that if AVT terminates in 2032 because this project, this project isn't going forward, then any pipeline property in the state would then be subject to regular state and municipal property taxes. We think this is an essential clarification because if the members look at several pages in combination. It's unclear— and I tell you what those pages are— it's unclear if there's a reversion, but what happens at that moment when the project isn't going forward. So the first section of relevance is Section 19.

That creates the except clause, uh, the temporary abatement and replacement by an AVT. The next clause or section of relevance is Section 20, which further explains that this project would be exempt from state taxes levied or authorized under AS 4356-010, municipal taxes levied or authorized under AS 4356-010B.

But then the, the difficulty comes at Section 21 at the bottom of page 16, termination of status. It says the alternative volumetric tax applicable to AKLNG under 4359.020 terminates on January 1, 2032, if commencement of construction of the first 730 miles has not begun. So that, that's the demarcation, and this amendment is designed to clarify that that's Fine, but what happens next? We have a void. There's a vacancy.

There's— there needs to be some restoration of something, and I ask for the support, and I'm told that this may meet, um, this may meet without objection from the producers.

Brief it is.

Will the House please come back to order. Mr. Majority Leader. Mr. Speaker, I have no objection to this amendment. It basically restates what I believe the bill already states, but certainly makes it very clear.

Thank you. If the objection is removed, and that's what I'm hearing, I'm not hearing additional objection, Amendment Number 30 is adopted. Madam Clerk. Amendment number 31 to amendment number 2 as amended by Representative Fields, beginning page 16, line 21. Representative Fields.

Brief it is.

Brief it is.

With the House, please come back to order. Representative Fields. Uh, thank you, Mr. Speaker. I move Amendment 31 to Amendment 2. Thank you.

There's an objection. Um, as I mentioned, the resource chairs, the majority leader, did a lot of hard work to advance. Could you speak a little bit louder? Sure. Directing your mic.

Yes, um, Mr. Speaker, as I mentioned, the resource chairs and majority leader did a lot of hard work in a very compressed time frame in a very unconventional way to advance this legislation to where it is today. Um, as I mentioned, I do support Amendment 2. There's one, um, I think, thing that got dropped in the drafting of Amendment 2 is it took away the AVT revenue share from localities based on population share per a community revenue sharing formula. So in the Resources Committee, the committee spent a lot of time thinking about regional fairness, including through the AVT, including for impacted communities in the pipeline corridor, because miles of pipe don't always equate to magnitude of impact. Because if you're looking at either property tax or an AVT calculation based on miles of pipe, For example, Fairbanks gets almost no revenue, Anchorage gets no revenue.

And again, miles of pipe may equate to impact. That's true in the Mat-Su Valley, but it may not. That's true in Anchorage and Fairbanks. So what this amendment does is attempt to restore some regional proportionality for AVT for communities in the pipeline corridor. And I think it is simply a fairer way to distribute that local community AVT and mitigate for local impacts.

And again, this is— it's not constructed precisely the same way as in the Resources Committee because we just didn't have time with the accelerated floor process, but it very closely approximates the distribution of funds as the bill came out of Resources.

Representative McCabe. Thank you, Mr. Speaker. I appreciate everybody standing up and advocating for their community. I think it's amazing. It's what we're supposed to do, actually.

However, Anchorage will benefit from this gas pipeline by having gas at a decreased price, or at least having gas at all. That will be a huge benefit for Anchorage. But I would like to know that if the impact to Anchorage, again, is a net positive, because you will obviously have workers moving in, they'll have kids, the kids will be going to school, it'll increase the ADN. Or ADM. It will increase the businesses, the churn, the need for businesses, hence business tax.

All of those things that the free market actually does for itself, Mr. Speaker, will benefit Anchorage as well as the other communities. I worry about communities or boroughs like Denali Borough that doesn't have property tax, right? I mean, that's why we have this impact, because they would have people moving in there that wouldn't provide any property tax to the borough to maintain roads and to maintain the waste, you know, waste management and those sorts of things. So to me, this is a little bit of a land grab, and I appreciate the representative from Anchorage for advocating for his community, but I struggle to see the negative impact to Anchorage. I really do.

From a free market perspective, I think Anchorage will be a net benefit, actually. Thank you, Mr. Speaker. Representative Settler. Thank you, Mr. Speaker. Yeah, in resources, we did look at a lot of formulas how to distribute the money and whether you call it impact aid or community improvement funds or whatever, and we did have a factor that allowed for the population exclusive of the number of miles of pipeline.

Kenai Peninsula Borough, I hope that happens if they have the LNG terminal. I hope the North Slope Borough gets the gas treatment plant, the CCS, and that the pipeline will provide revenue. And there's impact data along the pipeline corridor. But Anchorage being kind of large in population, kind of small in pipeline miles, I won't say they're getting shafted, but I think the impact that comes from Alaska— Anchorage, for me, the logistical hub, financial hub, medical services, financial services, everything that Anchorage provides to the state, especially in big projects. Is not reflected.

So I actually kind of applaud that a little bit of that factor is being returned to the bill before us. So Anchorage.

Representative Freer. Thank you, Mr. Speaker. I'm going to respectfully rise in opposition to this amendment. We did a lot of work and resources, and I get— I know that there are going to be impacts that happen in Anchorage. This is not the structure that we had when it left resources.

And if this— and I will say that I have a later amendment that does address that, that I hope does get passed. But I just respectfully oppose this amendment. I think that this doesn't reflect the work that we did and the intent that we were trying to do. Thank you, Mr. Speaker. Representative Ruffridge.

Thank you, Mr. Speaker. I'm going to rise in opposition to Amendment 31. Mr. Speaker, there was a lot of conversations that I listened to throughout the committee process in both this body and the other body, and I've never seen anything quite like this. And actually, Section 22 of the underlying amendment, I think, was really what was put in place to try to address many of the concerns of the maker of the amendment, and that's.

The Alaska Liquified Natural Gas Project Mitigation Fund. This is dollars, some quite, quite substantial amounts of dollars being appropriated to all of these different boroughs. Mr. Speaker, I think there's, um, I think maybe a little confusion about what AVT is supposed to do. AVT is supposed to be a smooth way of putting out a volumetric tax And this, what I see before us, is, well, we're going to take a little bit of that that is supposed to go to you and we're going to take it for us. That's what the mitigation fund was for.

I'm opposed to Amendment 31 for those reasons.

Mr. Majority Leader.

Yes, Mr. Speaker. So I reluctantly rise in opposition, but it is because I must be consistent. And if I'm not gonna support my neighbor in Fairbanks with his advocacy effort, I have to say this being introduced at this point and changing how the volumetric tax revenue gets split, I prefer that we leave it as the bill is. And another member has said they have another amendment coming that looks at this. Take a look at that, but have to be consistent and I'm gonna be a no vote.

Thank you.

In wrap-up, Representative Fields. Thank you, Mr. Speaker. Yeah, so, um, again, I think an AVT is fundamentally a good structure. AVT based on miles of pipe just doesn't equate at all to impact proportional population where goods and services come in. And I think it is true, um, that at a high volume, high export volume, this gas line will in fact generate a lot of revenue, benefit all areas of the state.

At low volume, essentially primarily in-state gas, the gas is going to be both very expensive and generate almost no revenue. So I think we may hope for the best, but we should prepare for a scenario where we have both very expensive gas and almost no revenue, and that hence the importance of having a little bit of a backstop to address some of those public services. And I also look forward to voting for the amendment. From my colleague from the north slope, and I'm glad she has a different model for restoring some of that regional fairness. Because it's not just about Anchorage, it's about how do we address regional impacts based on population.

Thank you. Are you ready for the question? The question being, shall Amendment Number 31 to Amendment Number 2 pass the House? Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to change his or her vote?

Will the clerk please announce the vote? 15 Yeas, 25 nays. By a vote of 15 yeas to 25 nays, Amendment No. 31. Amendment No.

2 Has failed to pass. Madam Clerk. Amendment No. 32 To Amendment No. 2 By Representative McCabe, beginning page 23, following line 21 of the amendment.

Representative McCabe. Thank you, Mr. Speaker. I withdraw Amendment 32 to Amendment 2. Amendment 32 has been withdrawn. Madam Clerk, um, Amendment number 33 will not be offered.

Amendment number 34 to Amendment number 2 by Representative Holland, beginning page 1, line 8 of the amendment. Representative Holland. Thank you, Mr. Speaker. I move Amendment 34 to Amendment Number 2. There's an objection.

Thank you, Mr. Speaker. I want to begin by acknowledging some have looked at some of my amendments and suggested that maybe I'm putting some things in here and doing some stuffing, I believe the words were. And to some degree in this amendment, I'm going to have to own a little bit of that. And, but I say that somewhat facetiously, but also with all seriousness, I'm offering this amendment. Originally I had intended that this would be one of the first amendments that I brought in.

As I started off, my intent with all of this work was to help ensure the conditions for the success of Alaska in participating in this pipeline project, and then to ensure consistent certainty and predictability and investability of this project as we move through the amendment process. This one, if you would kind of roll back in the thought process, is, I believe, a fundamental investment in creating the business conditions and the businesses that are necessary to fully participate and be able to grow and thrive because of this transformational project. This is the biggest thing coming along for a generation at this point of people. And if we roll back to the '70s, many of the companies that are the foundation of our economy today were started up during the pipeline era and then became the successful employers. We think of folks like Lynden and GCI, Dow and Bok that, you know, now are accepted employers.

And we know that 89% of our net new job creation over the last 10 years has come from businesses less than 5 years old. These are the businesses that create net new jobs. And I want to ensure that Alaskans and Alaskan businesses have the capability, capacity, and competitiveness to be able to be fully participating supporting this project. This amendment is a modest one in the scheme of the many zeros that we've been talking about, millions and billions. This puts a very modest amount initially into DCCED to provide funding for the startup accelerators that we have in Alaska to be able to expand the work that they're doing, the reach that they're able to provide, and then it aligns revenue from the project over time to keep this going on an annual basis.

I'm excited about the possibility that we might not only look at this project as one that would justify workforce training and creating capacity of Alaskans to be employed. But I hope we will also put some small amount of our effort into ensuring that we're building the businesses themselves that will not only participate during the construction and project operation phase, but then go on to be the bedrock of our future economy. So I look forward to any questions and discussion, and I'm encouraging you to support startup accelerators as a part of the investment in this project. Representative McCabe. Thank you, Mr. Speaker.

I think we heard this bill in committee, one of the committees I was in, probably State Affairs. I've been aware of this for a while. It does have a fiscal note associated with it, for those that are wondering. I can't remember how much it is. I see $500,000 in the bill, but it seemed to me it was more significant than that.

But let me say this, Mr. Speaker, all those that started up during the TAPS days, whether it be VECO, Alyeska, GCI, any of those, they did all that without an accelerator program. And in fact, the state has a wonderful accelerator program known as ADA. We've tried to, through various means, we've tried to impact ADA in this legislature. And frankly, that's our accelerator program. They have beautiful low-interest loans and accelerators for all kinds of businesses.

I've seen them listed at breweries, Lions Club, Big Lake Lions Club. There's hundreds of them, thousands of them in the state. There's many of them in Fairbanks. So Mr. Speaker, this, putting this in a gas line bill, I don't necessarily call that stuffing. I think I would call this a Christmas tree It really has no business in a clean gas line bill, and I urge a no vote.

Representative Kopp. Thank you, Mr. Speaker. I appreciate the member from District 9, a passion for startup accelerators, and I think he, he is absolutely evangelistic in that area and inspiring. To all of us. But I would agree with the member from District 30, that is a Christmas tree on this bill.

It's a good CAPSES project request, um, and, and it's something that I think, frankly, a lot of us do support these accelerators, but it just really is not connected to AKLNG. I would say, Mr. Speaker, that the AKLNG will be the biggest accelerator we have had for small businesses all by itself in the last 50 years. We get that gas line going and we have 7,000 jobs and families moving there and all kinds of support services. I mean, it's just going to be explosive opportunity all by itself. So for those reasons, Mr. Speaker, I reject this amendment and recommend the members vote no.

Representative Schwanke. Thank you, Mr. Speaker. I want to say, you know, thank you for the thought process on this. I do want to kind of echo the comments made by the Majority Leader, though. I do believe that this is exactly why we need the AKLNG, because industry is the place where capitalism is born.

The government is not here to create industry or jobs. Thank you.

In wrap-up, Representative Holland. Great. Thank you, Mr. Speaker.

Appreciate the questions and comments that came up on this. First off, regarding the question about the fiscal note, I think some may be connecting this up to the other bill for the Innovation Council. This is not that bill or that funding, although this did come up through a discussion with the ADA legislation. What I want to highlight around that ADA comment is ADA does have a number of very valuable programs, but you will notice when you look at their programs that they all essentially align around the ability of a company to be bankable. That is, that the company has gotten to the point where it has the assets, the business opportunity, that it can walk into a bank and then work with ADA on their bank loan backstop programs and loan guarantees.

And we need to understand that there's an entire nother level of earlier businesses that start off that can't qualify for any of those projects. They don't have the banking asset base to walk in to do that. And this is an established framework used around the world, actually, that is part of the fabric fabric of what creates the high volume of new startups that then do become bankable at some point, but they don't start off that way. We are also in a different place in time. Our DCCED, our economic development, if you look at that line item that used to have millions of dollars in it to support new businesses, that line item has got exactly zero dollars in it.

We are getting ready to do a transformational project for this state. And we have exactly $0 in the budget for economic development. Zero. Can we not recognize that this is a transformational opportunity and we're sitting here giving an empty bag to the businesses that would be the foundation of being able to really leverage this opportunity? So I urge your support for this.

I recognize that This is an activity that you might look at as kind of ancillary to the core of this project. And yet I don't think it is ancillary. I think if we don't look at this project for what it creates beyond the few years that we build it, and we only worry about the couple years when we dig the ditch and put the pipe in it and don't invest in the businesses that are going to be around afterwards, we're missing the opportunity. And I hope you'll support me in building this opportunity. Thank you.

Are you ready for the question? The question being, shall Amendment No. 34 To Amendment No. 2 Pass the body? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote?

Will the clerk please announce the vote? 18 Yeas, 22 nays. With a vote of 18 yeas to 22 nays, Amendment Number 34 to Number 2 has failed. Madam Clerk. Amendment Number 35 to Amendment Number 2 as amended by Representative Freer, beginning page 1, following line 23 of the amendment.

Representative Freer. Thank you, Mr. Speaker. I move Amendment 35 to Amendment Number 2. There's an objection. Thank you, Mr. Speaker.

I had drafted, hand-drafted Amendment Number 33 to Amendment Number 22, or Amendment Number 2, and did not offer it.

And tried to get this language that's handwritten that I hope people, I hope you all can read. I tried to write it very nicely. And so what this does is it just says that nothing in this legislation is intended to set a precedent. So, uh, permission to read, Mr. Speaker? Permission granted.

Thank you, uh, Mr. Speaker. So it just says that it is the intent of this legis— legislature that this act be narrowly construed and not serve as precedent, guidance, or interpretive authority for the taxation of any other property subject to taxation under AS 43.56 or AS 29.45. And that's essentially what this amendment is. Does. Thank you, Mr. Speaker.

Gràcies.

Will the House please come to order? We are under debate on Amendment Number 35 to Amendment Number 2. Minority Leader Johnson. Thank you, Mr. Speaker. I just wanted to say that I think this is a smart amendment.

I think it's thoughtful and I think it's common sense, and I would urge folks to vote for it. So with that, I'll remove my objection. The objection has been removed. Mr. Majority Leader, Mr. Speaker, I rise in strong support of the amendment.

Thank you.

Well, not hearing any further objection, Amendment Number 35 has been adopted. Madam Clerk, Amendment Number 36 to Amendment Number 2, as amended by Representative Dibert, beginning page 23, following line 18. Representative Dibert. Thank you, Mr. Speaker. I move amendment number 36 to amendment number 2.

There is an objection. Representative Dibert. Mr. Speaker, this amendment— the story behind this amendment begins at the top of page 23 for folks to follow along online. 6 And 7, um, filing with the commission for system-wide tariff treatment for the spur line with an economically viable gas sales contract and not-for-tariff treatment that allocates costs for financing, construction, operations, and maintenance of the spur line solely to the Interior Region of the state. So what this amendment asks is to add the definition on— after line 18.

Yeah, page 23, following line 18 of the amendment. It would insert the definition for economically viable gas sales contract. And the reason why I'm moving this amendment forward Is the definition— when we add the definition, it makes clear that a commercially reasonable agreement or similar commitment to serve existing or reasonably projected interior demand is sufficient, including residential, commercial, or industrial demand aggregated by utility or other entity. It also makes clear that the interior does not have to bear the full capacity or full capital and operating costs of the spur line on its own. And when we add this definition, it doesn't weaken the spur line requirement, which I fully thank the, the maker of the Amendment 2 for making sure that that spur line language is in.

Spur tariff must be system-wide, not interior only. Thank you. I'm just— thank you so much for the maker.

It ensures that the project remains tied to real Fairbanks demand while recognizing the practical realities of financing this infrastructure. So I urge support for the amendment.

Representative Ruffridge.

Thank you, Mr. Speaker. I'm going to rise and Opposition to Amendment 36. I think in Amendment Number 2, starting page 23, line 6, filing with the Commission for Systemwide Tariff, that is the RCA, who is going to be the entity responsible for economically viable— economically viable gas sales contract. That is their job. Also, as far as the distribution of the cost, I think the language there is already very specific.

Permission to read, Mr. Speaker? Permission granted. Thank you. It says that the maintenance of the spur line, or the financing, construction, operations, maintenance of the spur line cannot be allocated specifically to the Interior Region of the state because it is going to be system-wide, and that is from the North Slope to the South Central Region of the state. I feel like that is very clear that the spur line to Fairbanks cost will be subsidized by the rest of the ratepayers in Alaska.

Thank you, Mr. Speaker.

Representative Mears.

Thank you, Mr. Speaker. I rise in support of this amendment. I—. It has this definition that is very specific to this section of the bill, which is the conditional language for the Fairbanks Spur Line. It provides guidance and support for the Regulatory Commission of Alaska to be making the decision on the— those terms being met.

I think spelling those terms out at a minimum for, uh, the interior residents is appropriate. Thank you.

Mr. Majority Leader.

Uh, yes, Mr. Speaker, I rise in opposition to the amendment only because the underlying amendment already requires, uh, this to happen for the Fairbanks Spur project. And I, I think what, what we're doing here is kind of doubling down on it But my, my view of it is this is already required in the underlying bill, and I would not like to make that be more, more complicated to the project. Thank you, Mr. Speaker. Representative St— Briefities.

Will the House please come back to order? We are under debate on Amendment Number 36 to Amendment Number 2.

Representative Stepp. Yeah, I thank you, Mr. Speaker. I rise in strong support of this amendment. There's a couple of things here. Number one, the reason that we're— delegation's offering this amendment because it's our understanding the language in the current underlying amendment regarding economically viable gas sales contract is not defined in a proper legal manner, which would lean heavily on interpretation.

Of leaving room for dispute over how much gas demand, what price, what contract terms, and what customer base is large enough or viable enough to be considered economically viable. So this definition and this amendment simply just makes clear that Fairbanks does not need to prove that Interior ratepayers alone can support the project. That was stated many times throughout this amendment project already by many of our wonderful colleagues. And that this matters because the amendment language, Mr. Speaker, already says the tariff filing should not allocate financing construction operations and maintenance costs solely to the Interior Region. So the reason the maker of the amendment is putting this forward is to define in the actual bill what that actually means.

Thank you.

In rep. Mr. Majerle. Yeah, brief it is. Brief it is.

The House, please come back to order. Mr. Majority Leader. Mr. Speaker, I withdraw my objection to this amendment.

Not hearing further objection, Amendment Number 36 to Amendment Number 2 has been adopted. Madam Clerk.

Amendment number 37 to amendment number 2, as amended by Representative Carrick, beginning page 22, line 8. Representative Carrick. Thank you, Mr. Speaker. I move amendment 37. There's an objection.

Thank you, Mr. Speaker. So I just— amendment 37 adds conditional language which would state that the underlying bill, SB 180, as it would be amended by Amendment Number 2, would not pass unless House Bill 78, which was passed earlier this session, were to go into law today. Mr. Speaker, I just want to point out in this process that we are under a time crunch. There is a deadline that has been spoken about in the public media that has been reported on. But Mr. Speaker, mostly I just want to point out that A strong private sector is what is potentially guaranteed by the buildout of a gas line as in Amendment Number 2.

But a strong public sector is needed to support that strong private sector development. And a strong public sector is helped very, very substantially, I would say transformational to that, is House Bill 78. Now again, Mr. Speaker, these bills have been tied together in coverage, and I just, I wanted to point out that fact.

Ultimately, Mr. Speaker, we're making decisions today that are very substantive. We're making decisions that are potentially locking in this legislature and this state for a very long time, and we're doing it really kind of in a rushed, on-the-fly capacity. It's concerning to me, but at the same time, I have watched this legislature put forward conditional language before. I generally don't support conditional language in bills. I think it's really problematic to say a bill should or should not pass based on other legislation.

And we've even seen it this legislature on bills I've run, and I've opposed it deeply. I don't like doing that. And so I mostly— I rise to make a point as we go through this process. And I will withdraw Amendment No. 37 To it.

No. 2. There's an objection to the withdrawal of Amendment 37. Representative Stapp. Yeah, thank you, Mr. Speaker.

I don't want to withdraw the amendment. Actually, I might withdraw my objection because I don't want to vote for the amendment, but I just want to appreciate the maker of the amendment for telling the public what exactly is happening here, Mr. Speaker. Thank you.

So the objection to the withdrawal of the amendment has been removed. This amendment number 37 has been withdrawn. Madam Clerk.

Amendment number 38 to amendment number 2 as amended by Representative Staab, beginning page 1, line 6. Representative Stapp. Thank you, Mr. Speaker. I move amendment number 38. There's an objection.

Point of order. Point of order, Representative Josephson. This appears in every respect to be House Bill 271 sitting in the Rules Committee, and I would ask for ruling on whether that requires a discharge motion.

Mr. Speaker. Representative Stepp, I'm gonna ask you to address it. I don't, I wouldn't obviously need time to contemplate that question, Representative Josephson.

The amendment that we have before the body is not drafted by Leg Legal, so I don't know if it actually conforms to House Bill 271. I think content-wise you could argue it does from reading it here. Just on the fly.

So I'm going to call brief fiddies to further consider this.

Will the House please come back to order. Mr. Speaker, the Grim Reaper.

Apparently we didn't learn the first time. I'd like to place a call on the House till we're done with this bill.

There has been a call on the House for the rest of the 2026 session.

So we have before us Amendment Number 38 to Amendment Number 2. Representative Stapp, I believe you moved the amendment, did you not? And was there additional debate or discussion?

The objection has been registered. And Representative Josephson has his mic up in the far corner. Representative Josephson.

Well, I'm not going to telegraph how I'm going to vote on this amendment. But I will let the members know that in committee, a lead petroleum economist with DNR— I think I've got that right— testified that this was a $30 to $50 million hit to the state treasury. And we're not raising any money in this bill. I mean, I guess we are prospectively through tax and royalty, but this is And I would note that about 85% of the production in Cook Inlet is Hilcorp's. So they would be the major beneficiary of Amendment 38 to Amendment 2.

But I'm not telegraphing how I'm voting for it. Representative Sadler. Certainly don't want to telegraph. No, I would telegraph that I'm going to support this because we've been talking all afternoon and so far some of the evening about the desire to get natural gas to Alaskans. And this, by reducing the royalty on Kitchen Light Unit, I think we'd be going a long way towards incentivizing the economic activity necessary to produce gas and get it through the pipes to the burner head of my water heater.

And anyone else is on the gas, on the rail belt, might appreciate this as well. So this is a good one for me. I hope we can get the vote. Representative Mears. Thank you, Mr. Speaker.

I certainly am aware of our natural gas situation. I appreciate efforts on that, on that measure. But the provision for cost savings to end users is not the metric we need. If we're looking for production from Cook Inlet, it's more. It's not less cost because that's what we're measuring against importing LNG.

So I will not be supporting this. I think there are some flaws in the methodology. Thank you.

Representative Ruffridge. Thank you, Mr. Speaker. Quite a journey we've taken here today. I rise in opposition to Amendment 38. I will be direct.

I am in support of the bill that this is coming from, but I think our interest here today has been and should always be the interest of getting a clean gas line bill through this body. And do it before we end the session. And I think this would complicate matters because it is dealing with Cook Inlet supply of natural gas and not the very complex properties of attempting to get a gas line built in the state. So I will be opposed. Thank you.

Mr. Majority Leader, you were reaching for your microphone earlier. I don't know if you—. Mr. Speaker, I concur in the remarks from the member from District 7. Also, we're introducing a tax policy into this bill to be consistent.

I have pushed back on that. I also support the underlying amendment if it was by itself, but this is a sweeping additional policy that should not be part of the AKLNG project, nor should it have to carry that. Thank you, Mr. Speaker. I'll be a no vote. Brief it is.

Will the House please come back to order. Representative Stapp. Yeah, thank you, Mr. Speaker. I, um, I'm a little sad. I, I think this is probably the best thing that we could do for energy production on this entire 2 years in legislative session, but after consulting with folks and members who want to keep this bill strictly related to the gas line, it saddens me that I will be withdrawing Amendment 38.

Amendment number 38 has been withdrawn. Madam Clerk. Amendment number 21 to Amendment number 2 by Representative Freer, beginning page 1, line 6. Representative Freer. Thank you, Mr. Speaker.

I move.

Amendment 21. There is an objection. Thank you, Mr. Speaker. Permission to— from—. Permission granted.

—To read? Thank you. So Amendment Number 21 puts the gas treatment plant and the LNG facility back under municipal property tax and authorizes the respective boroughs to negotiate lower mill rates with the project developer on both components. This could include, but does not necessarily include, an equity stake in the project in lieu of property tax revenue. For the pipeline, there is a simple alternative volumetric tax applied at 9 cents per 1,000 cubic feet of gas throughput.

The complex and unmodeled AVT weighted by capital cost is removed. The AVT is adjusted by urban Alaska CPI annually, smoothed over 5 years after it takes effect. The revenue language written by House Resources for AVT revenue is restored, as we spoke about earlier. 50% Of the AVT is directed to municipalities proportional to the percentage of pipe in their tax jurisdiction. The other 50% is directed to all municipalities in the state proportional to population.

This amendment preserves the temporary abatement language in the underlying amendment, and that's what Amendment 21 is. Thank you, Mr. Speaker. Representative Kopp.

Yeah, Mr. Speaker, I rise in opposition to Amendment 21 to Amendment 2. By removing the gas treatment facility from the AVT that's in the bill of 12 cents for that facility, the project is not able to get financing. It's that simple, Mr. Speaker, because it introduces an unknown negotiated rate that would apply to that facility, which is very significant. And when something is unknown of that magnitude, You can't get investment. So for that reason, I oppose it.

Representative McCabe. Thank you, Mr. Speaker. Once again, I appreciate the representative from— for supporting and advocating for, for her district and for her area. And that's, that's really important. That's what we're supposed to be sent here to do.

But let's keep in mind that this is a gas pipeline for all of Alaska. We all need to pull on the oars together, Mr. Speaker, and allowing one district or one borough to negotiate separately with the gas line company and maybe not others, I think it's a mistake. Not everybody is going to have the gas treatment facility. I mean, I understand that there's— it's a bigger facility. That's why there's an increase in the volumetric tax that's supposed to go for that.

Facility up there. But I just think this right now will kill the gas line for all of Alaska. Just, it's a mistake, and we need to figure out a different way to reimburse the North Slope Borough, frankly, for the, for that, for that plant up there, for the liquefaction plant. That's, that's all there is to it. I don't know how we can do it.

This is not the way. This will kill it because it will not get financing with the uncertainties that surround this type of negotiation. Thank you, Mr. Speaker.

Further debate or discussion? Any wrap-up comments? Representative Freer. Thank you, Mr. Speaker. As I stated previously in House Resources, and I, I just want to note we did extensive work on House Bill— well, House Bill 381, which is the House version of the Gas Line Bill in House Resources.

We met with the administration, we met with Glenfarn, we met with stakeholders, we met with the municipalities, we met with the Building Trades Association. You want to talk about pulling on oars? Out of the 60 legislators that represent Alaska, I am the only one from the North Slope, so I have to fight for my district, and I have to fight against— I have— everyone wants to pull the resources out of there to benefit the rest of Alaska, but you want to take away our property taxing rights. These are our property taxing rights. These are our resources on the North Slope.

This is not going to kill the bill. What this does is it allows us to negotiate. It allows my municipality to negotiate. It's already in statute that they have the ability to do that, and you want to take away the right of, uh, for us to be able to negotiate. It doesn't have to be at a $17.99 mil rate.

What they want to do is to negotiate based off of what they know. They don't know what the costs are. They don't know what it's going to be because everything is behind closed doors. Everything is a secret. We've been asking, we've been asking for information.

We've been asking for information in committee. All of the— all we're doing is asking for the ability to negotiate. And this is not just the North Slope Borough. This also includes Kenai so that Kenai can also negotiate.

We just want to negotiate, Mr. Speaker. We want the ability to have a seat at the table.

That's all. And I would— this also would include the ability to put the 50% back to the— based off population, the community assistance. So I urge support for this, and I will be incredibly disappointed if members vote no. You're ready for the question? The question being, shall Amendment Number 21 to Amendment Number 2 pass the body?

Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to change his or her vote? Representative Ballard.

From a yay to a nay.

I change my— Rep. Calvin, from a nay to a yay.

Will the clerk please announce the vote? 21— Oh, sorry, go ahead. 21 Yays, 19 nays. By a vote of 21 yeas to 19 nays, Amendment Number 21 to Amendment Number 2 has passed the House. Madam Clerk.

Amendment Number 24 to Amendment Number 2 as amended by Representative Freer beginning page 2 following line 10. Representative Freer. Thank you, Mr. Speaker. So Amendment Number 24 to Amendment Number 2 leaves the major project components in the AVT. The gas transmission lines from Point Thompson and Prudhoe Bay would be taxed under AS2945 municipal—.

Representative Freer, can I get you to move the amendment, please? Oh, sorry. I move Amendment No. 24, And I ask the body's permission to read. Permission granted.

Thank you. So the gas transmission lines from Point Thompson and Prudhoe Bay would be taxed under AS2945 municipal property taxes. The North Salt Borough would be authorized to negotiate for a lower mill rate with the project developer. This could include, but does not have to include, an equity stake in lieu of property tax revenue. The AVT on the rest of the project would be left alone from the project gas treatment plant down to the LNG facility in Kenai.

Thank you, Mr. Speaker. Under debate on Amendment Number 24.

If there isn't any— Representative Kopp. Yes, Mr. Speaker.

I rise in opposition to Amendment 24 to number 2. I think it, you know, it gives the borough an equity-for-taxes option on the upstream feeder lines. It's separate from the main pipeline tax framework. I do not believe that this was modeled in other committees. Have not heard from the project on whether or not this fundamentally unrounds the economics.

And Mr. Speaker, I would ask for a brief at ease. Brief at ease.

ទ្ទ្ទ្ ទ្ទ្ទ្ ទ្ទ្ទ្ទ្ទ ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ�.

Will the House please come to order? We have Amendment Number 24 to Amendment Number 2 before the body. Representative Freer. Thank you, Mr. Speaker. I move to table Amendment Number 24.

The motion before the body is to table. It is a non-debatable motion.

Table Amendment Number— there is no objection, so the motion to table has been adopted.

Madam Clerk. Amendment number 3 by Representative Vance, beginning page 1, line 1. Oh, let's back up here a little bit. We are not going to go to amendment number 3, and my apologies. Representative Bynum, you were seeking the floor.

Yes, thank you, Mr. Speaker. I rise for a point of parliamentary inquiry, Mason's Section 250. Mr. Speaker, we had just a moment ago adopted Amendment 21, but prior to adopting Amendment 21, Mr. Speaker, the very first amendment of the night that we adopted was Amendment 1. And what Amendment 1 did was in the bill, page 2, starting on line 5, it deleted Section 3, completely deleted Section 3. In the amendment that was passed, Mr. Speaker, if you look at it on page 1, starting on line 6— correction, starting on line 5, it says delete all material and insert.

There's an incomplete insertion, Mr. Speaker, and that incomplete insertion into the section that was deleted, Section 3, cannot be corrected by conforming change of the Legislative Legal. I consulted with Legislative Legal to confirm that Section 3 was removed, and by just, just by trying to add one part of that, Mr. Speaker, means that Section 3 is incomplete and not valid. So it creates a problem with Amendment Number 21 because the portion of Amendment 21 hinges on the fact that it has that section included. And so I'm rising for a parliamentary inquiry to, um, want to know how the Speaker would like to proceed with this technical issue before us. Thank you, Mr. Speaker.

House, please come back to order. I believe we have a parliamentary inquiry before the body. And Representative Bynum, could you restate that, please? Thank you, Mr. Speaker. I was rising to a point of parliamentary inquiry to resolve a potential issue in Amendment 1 versus Amendment 21 and the effect of which they did.

And after further consultation with legislative legal, they basically gave us 3 options. They said that we could leave it as it is and the drafting manual may resolve the issue. They also said that we have, we could also rescind action on the first amendment that we had passed, Amendment 1 of 2. They also said we have an action to, or an opportunity if we'd like to rescind action on 21.

One of two if we have a concern that either one of those would conflict. But I believe that my preliminary inquiry has been satisfied, and I yield the floor.

So if I just heard you properly, you believe your parliamentary inquiry has been satisfied, the options are before the body. I think that's clearly delineated, and so I'm going to leave it at that. Okay.

Madam Clerk. Representative Kopp. Mr. Speaker, based on what the member from Southeast just said, I move and ask unanimous consent to rescind the previous action adopting Amendment 21 to Amendment 2. There isn't a No objection. So we will— So the question before the body is to rescind previous action in adopting Amendment 21 to Amendment 2.

Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 20 Yeas, 20 nays. So the motion to rescind fails.

20 To 20. 3 Pities. 3 Pities.

ប្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រុំត្រ ប្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រាន្រ ស្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រុង្រ ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ� ទ្ទ្ទ្ទ្

Will the House please come back to order.

At this time, committee substitute for Senate Bill 180 will be rolled to the bottom of the calendar, and the intention is to take up the regular calendar.

In the order that the bills are listed.

Madam Clerk, I am catching you pretty much off guard, but when you get them organized—.

Committee substitute for Senate Bill 9, Judiciary, by the Senate Judiciary Committee. Entitled An Act Relating to the Surrender of Infants and Providing for an Effective Date. The Judiciary Committee considered the bill, recommends it be replaced with committee substitute— with House Committee Substitute for Committee Substitute for Senate Bill Number 9, Judiciary, with a new title, HCR 14, attached 3 previously published zero fiscal notes. Signing the report do pass: Representatives Vance, Underwood, Costello, No recommendation. Aishaid Mena and Chair Gray, there is one House Committee Substitute.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House Judiciary Committee Substitute for Committee Substitute for Senate Bill 9 Judiciary with the new title be adopted in lieu of the original bill. No objection. The Judiciary House Committee Substitute has been adopted.

Madam Clerk, are there any amendments?

I have no amendments, Mr. Sweet. Brief it is.

House, please come back to order. Representative McCabe. Thank you, Mr. Speaker. I lift the call in the House. So the call has been lifted, and I think we're in the process of waiting for an amendment to be copied and distributed.

I'm looking at the Sergeant-at-Arms to confirm that it is being copied and distributed. We'll stand at ease until we get the amendment distributed.

ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ� ទ្ទ្ទ្ ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ្ទ� ទ្ទ្ទ្ទ្ទ අපි ස්තූතියි ස්තූතියි ទ្ទ្ទ្ ទ្ទ្ទ្ទ.

Will the House please come back to order. We have Senate Bill 9 before the body. Madam Clerk, you're gonna have to remind me where we were before we left. House Committee Substitute for Committee Substitute for Senate Bill Number 9, Judiciary, Surrender of Infants Infant Safety Devices is before the body in second reading.

Mr. Majority Leader, I made it earlier, but I'll make it again. Yes, Mr. Speaker, I move and ask unanimous consent that the House Judiciary Committee substitute for committee substitute for Senate Bill 9 Judiciary with a new title be adopted in lieu of the original bill.

I think we're— and it's my apologies— I think that hearing no objection, the Judiciary Committee substitute has been adopted. And I think, Madam Clerk, we're getting back to where we left off. Are there any amendments? There are no amendments, Mr. Speaker. There are no amendments.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House Committee substitute for committee substitute for Senate Bill 9 Judiciary be considered engrossed, advanced to third reading, and placed on final passage. Hearing no objections, so ordered. Madam Clerk, please read the title for the third and final time.

House Committee Substitute for Committee Substitute for Senate Bill Number 9, Judiciary, by the House Judiciary Committee, entitled An Act Relating to the Surrender of Infants Relating to Civil History and Providing for an Effective Date. Frank, uh, Representative Tomaszewski. It's getting late. Thank you, Mr. Speaker. Uh, and yeah, let me be frank with you.

Alaska Safe Surrender Law allows a parent to safely surrender an infant under 21 days old directly to a person if the parent no longer feels able to care for the child. However, um, there are still barriers to safely surrendering an infant to a person directly. SB 9 would allow— authorize the installation of climate-controlled safe surrender devices as an alternative to physical surrender to a person. The bill outlines requirements for infant safety devices such as appropriate signage, an alarm system that triggers a 911 call when a device is opened, and automatic lock to secure the infant after use. The bill allows these safe surrender devices to be installed in a conspicuous place with appropriate signage in hospitals, other health facilities, fire stations, or police stations.

And I think we have all heard this bill and all have listened to this bill and know what it does. And so I just simply ask for your support. Representative Fields. Uh, I'll be brief. This bill came through my committee and I failed to identify some issues that I subsequently became aware of.

Namely concerns brought about by the inventor of the baby box, issues around what happens if a baby is kidnapped and placed in a box, and some other safety issues. So I'm just briefly registering why I'm not supporting the bill. Thank you.

Not seeing additional debate and no wrap-up comments. Are you ready for the question? The question being, shall House Committee substitute for Committee substitute for Senate Bill 9, Judiciary, pass the House? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 35 Yeas, 5 nays. With a vote of 35 yeas to 5 nays, Senate Bill Senate Bill 9 has passed the body.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the roll call on the passage of the bill be considered the roll call on the effective date clause. Hearing no objection, the effective date clause has been adopted. Mr.

Majority Leader. Mr. Speaker, I move and ask unanimous consent that House Concurrent Resolution 14, the title change resolution for Senate Bill 9, be taken up as a special order of business. Without objection, are you ready for the question? The question being, shall House Concurrent Resolution 14 pass the House? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 40 Yeas, 0 nays. With a vote of 48 ayes, 0 nays, HCR 14 has passed the House.

Madam Clerk.

Committee substitute for Senate Bill Number 21, Finance, by the Senate Finance Committee, entitled An Act Establishing the Alaska Work and Save Program in the Department of Revenue and Providing for an Effective Date. The Labor and Commerce Committee considered the bill, recommends it be replaced with House Committee Substitute for Committee Substitute for Senate Bill 21, Labor and Commerce, with a new title, HCR 18. Attached: one previously published indeterminate fiscal note and one new fiscal note. Signing the report: do pass, Representatives Freer and co-chairs Hall and Fields. No recommendation: Colon, Carrick, Sadler.

Amend: D. Nelson. The Finance Committee also considered the bill, recommends it be replaced with House Committee Substitute for Committee Substitute for Senate Bill 21, Labor and Commerce, with a new title, HCR 18. Attached one new fiscal note and one new zero fiscal note. Signing the report do pass: Representatives Jimmy, Galvin, Hannon, Moore, and Co-Chair Foster. No recommendation: Tomaszewski, Allard, and Bynum.

There is one House Committee Substitute.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House Labor and Commerce Committee substitute for committee substitute for Senate Bill 21 Finance with the new title be adopted in lieu of the original bill. Hearing no objection, Labor and Commerce Committee substitute has been adopted. Madam Clerk, are there any amendments?

I have no amendments, Mr. Speaker. Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House Committee substitute for committee substitute for Senate Bill 21 Labor and Commerce Be considered in gross advance to third reading and placed on final passage. There being no objections, so ordered.

Madam Clerk, please read the title for the third and final time. House Committee Substitute for Committee Substitute for Senate Bill Number 21, Labor and Commerce, by the House Labor and Commerce Committee, entitled An Act Establishing the Alaska Work and Save Program in the Department of Revenue Relating to Depositing Permanent Fund Dividends into Investment Accounts and Providing for an Effective Date. Representative Costello. Thank you, Mr. Speaker. Senate Bill 21 is a bill that creates an automatic individual retirement account program for small businesses to offer to their employees.

Currently, 64% of businesses do not offer a retirement option for their employees, and this is a great way to retain and recruit workers. What it does is it reduces— uh, deducts 5% or takes 5% of per paycheck and puts it into a retirement account that follows the worker. We would be one of 17 states that has this type of program. And if it becomes law, we would be working with a multistate partnership. Again, this has no impact on the employer, but it allows employees to save.

For their retirement. This is a real issue for many of our workers who don't save for retirement. It's rather shocking how little many Alaskans have saved when they reach retirement age. And so this bill was actually brought to the legislature by AARP. We received 50 letters of support from small businesses in Alaska.

Through the process, I want to thank the member from District 24 because he amended the bill to include a pick-click-save option so that employees who have this option can automatically move their dividend into their IRA. In addition, if you want to move your dividend into your own IRA, you can do that too very simply with your pick-click-save option. Again, I want to thank the AARP for bringing this to us. When we heard the bill in the House Finance Committee and we heard testimony, one of the testifiers said that this really is a gift and we have not seen any objection to this legislation. So I really encourage everybody to press the green button and thank you.

Donald Trump. Will the House please come back to order. Under debate, Senate Bill 21. Representative Sadler. Thank you, Mr. Speaker.

I rise in support of SB 21, the Alaska Work and Save program. I've long been concerned about Alaska's financial health, and it's difficult. I was in the Finance Committee as the vice chair hearing from people who got to the end of their life after working hard and being good parents, good family members, but not having enough money to take care of themselves when they got older. Older. They seek our state help and we do what we can to help.

We have some programs, but we cannot do everything for all people. We have limited resources. You know, the miracle of compound interest, Einstein once said, is the most powerful force in the universe. A little bit of money put away early, regularly, automatically, without thinking, is a key to long-term financial health. This bill makes it easier for Alaska workers— not mandatory, but easier— to engage in financial planning and financial discipline so that when they do get to the end of a career, they do not come to us for asking for benefits.

You know, the state of Alaska does offer many benefits to its employees and may soon be offering more. We don't know tonight, but sometimes we forget that 80% of Alaskans do not work for the state, do not get a government check, and this bill will give them the opportunity, those other people, the chance to put money away for their own benefit when they get older. By making retirement savings more accessible and achievable, we will do great things for the next generation and future generations of Alaskans. I appreciate the member from Sand Lake acknowledging Pick Click Save. An effort I've had in the hopper for a couple of years and have tried a couple of times to get passed.

Money passes through Alaskans' hands each year, maybe not enough, but some. And I can't help but think that if we have the opportunity to more easily invest that for their long-term financial health, that people will be better off. So I think I'm going to vote yes for this, and I encourage other members to vote green. I won't make the obvious green money pun, but this is a good bill and it'll be good for Alaskans' long-term financial health.

Any wrap-up comments? Representative McCabe. No wrap-up comments for me, Mr. Speaker, but I do have a comment. So I struggle with this bill because it has a fiscal note, and permission to read, Mr. Speaker. Funding— ideally a new funding source would be created for the program.

As revenue projections are unknown, unrestricted general funds will be required in the initial startup of this program. The department will evaluate revenue projections in future budget planning periods to best align the funding sources with available program revenue. So I looked at this, I looked at the fiscal note, I said to myself, and I knew it was me because I was wearing my clothes, I said, can you vote for this because it's got a fiscal note? And the answer was, is the fiscal note is obviously a projection by, by the department on what they think might happen. So they're giving us the worst-case scenario.

I think the benefits of this program far outweigh the, the fiscal note, and I think in the future we will see that this program actually benefits Alaskans and it benefits small businesses and it benefits employees in ways that, that we can't even determine here tonight. So I think I'll be a yes vote on this one, Mr. Speaker, for those reasons, even though I know that as a fiscal conservative, I need to be spending some time in reducing the cost to Alaska. Thank you. Any wrap-up comments? Representative Costello, are you ready for the question?

The question being, shall House Committee subsume for Committee subsume for Senate Bill 21, Labor and Commerce, passed the House? Members may proceed.

Thank you.

Let's try that again. The question before the body is: Shall House Committee substitute for Committee substitute for Senate Bill 21, Labor and Commerce, pass the House? Members may proceed to vote.

The clerk, please lock the roll. Does any member wish to change his or her vote? Will the clerk please announce the vote? 31 Yeas, 9 nays. By a vote of 31 yeas to 9 nays, Senate Bill 21 has passed the body.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that the roll call on the passage of the bill be considered the roll call on the effective date clause. Hearing no objection, effective date clause has been approved. Adopted.

Mr. Majority Leader. Mr. Speaker, I move and ask unanimous consent that House Concurrent Resolution 18, the title change resolution for Senate Bill 21, be taken up as a special order of business. Without objection. Are you ready for the question?

The question being, shall House Concurrent Resolution 18 pass the body? Members may proceed to vote.

Will the clerk please lock the roll? Does any member wish to change his or her vote? Will the clerk please announce the vote? 40 Yeas, 0 nays. With a vote of 40 yeas to 0 nays, the title change resolution has passed.

Madam Clerk. Committee substitute for Senate Bill 24 Finance by the Senate Finance Committee. Entitled An Act Relating to Tobacco, Tobacco Products, Electronic Smoking Products, Nicotine, and Products Containing Nicotine, raising the minimum age to purchase, exchange, or possess tobacco, a product containing nicotine, or an electronic smoking product, relating to the Tobacco Use Education and Cessation Fund, relating to the taxation of the electronic smoking products and vapor products, and providing for an effective date. The Finance Committee considered the bill, recommends it be replaced with House Committee Substitute for Committee Substitute for Senate Bill Number 24 Finance with the same title, attached one new fiscal note and seven new zero fiscal notes. Signing the report: do pass, Representatives Moore, Hannon, Galvin.

Co-chairs: Josephson, Schrag, and Foster. No recommendation: Allard and Tomaszewski. Amend: Bynum and Jimmy. There is one House Committee Substitute. Mr.

Majority Leader. Mr. Speaker, I move and ask unanimous consent that the House Finance Committee substitute for committee substitute for Senate Bill 24 Finance be adopted in lieu of the original bill. Hearing no— brief, please.

House, please come back to order. Madam Clerk, are there any amendments? Amendment number 1 by Representative Staff, beginning page 3, line 24. Represent— Madam Minority Leader, I was just about to call on Representative Staff. Do you have a point of order or—.

Thank you, Mr. Speaker. I missed the opportunity to object for purposes of explanation of changes. Thank you, Mr. Speaker. We are a little bit out of order. Representative Hanna, do you want to go through the committee changes?

Explain. That in the Senate— or excuse me, in the House Finance Committee, uh, we lowered the fine possession of tobacco on electronic smoking products or product containing nicotine for a person under 21. Uh, we lowered that fine from $300 to $100. We eliminated the mandatory court appearance for minors, so then it would be treated like a citation or similar to alcohol infractions for those underage, where you are receive a citation and can pay the fine. We added language to capture synthetic nicotine products and other tobacco products that are defined so that our state's excise tax applies to that new emerging tobacco line.

We added a provision to require labeling for vape products that display their total nicotine content. We moved the definition of retail sales to the correct section of the bill, and we updated the effective dates to July 1, 2027, for sections 13 16, 23, and 29, and July 1st, 2026, for all other sections.

Brief it is.

Will the House please come back to order. Representative Stepp, Amendment Number 1. Thank you, Mr. Mazuca. I will not offer this amendment at this time. Amendment Number 1 will not be offered at this time.

Madam Clerk, Amendment Number 2 by Representatives Bynum and Jimmy, beginning page 1, lines 2 through 3. Representative Bynum. Thank you, Mr. Speaker. I move Amendment 2. There's an objection.

Thank you, Mr. Speaker. Permission to read. Commissioner Granard. Mr. Speaker, what Amendment 2 does is that it basically leaves our existing statutes in place for the penalty for possession. Federal and public health organizations broadly support raising the minimum legal sales age of tobacco, vape, and e-cigarette products to 21, the Tobacco 21 or T21 initiative.

Research indicates that these laws can reduce youth access, delay nicotine addiction, and lower long-term smoking rates. However, many public health and legal policy organizations distinguish between enforcement of sales restrictions against the retail distribution of these products and the criminalization or citing underage persons, which we refer to as the Possession, Use, and Purchase, PUP violations. A growing body of public health guidance cautions that youth Possession penalties may create unnecessary and inequitable law enforcement interactions while producing limited evidence that provides a public health benefit. Mr. Speaker, there are many studies. If you go out there on the internet and you look, you'll see studies from the CDC that talk about the Tobacco 21 Implementation Guidance that talks about the strongest enforcement for reducing smoking is at the retail enforcement level, not creating penalties for those that are underage.

Research indicates that the purchase, use, and possession penalties might not effectively change behavior if you're creating fines. That's from the CDC, Mr. Speaker.

There's many other studies that are out there that will tell you that creating fines is not the most effective way of doing this. There's a Minnesota Tobacco-Free Alliance initiative and study that was done that talks about youth penalties and police interactions. And one of the key findings from that study, Mr. Speaker, is, is that when you create fines and interactions with police, that it can create a negative impact on the youth. Not a positive one.

More importantly, Mr. Speaker, what is found when you look at most of these interactions is that these interactions do create disproportionately impact, impact on minorities, especially minority youth. Mr. Speaker, I'm 100% against creating additional laws of penalty here. All I'm asking for is leave the existing law in place, without creating additional penalties for 19- and 20-year-olds. One of the other concerns that I have, Mr. Speaker, is that when we talk about law enforcement interactions, we create an opportunity for pretextual stops. That means that anyone walking down the street, as an example, smoking a cigarette that may look like they're underage, can create— that creates an opportunity for for an interaction with law enforcement.

I don't think the intent of this law is for us to create additional interactions with law enforcement. I talked with the court system, uh, Mr. Speaker, and when I talked with the court system, what they told me was, is the majority of fines being issued right now are actually happening in schools. My amendment doesn't change that. That's the bulk of them. What I would hate for us to do is create opportunities for these interactions, for contextual stops that are unnecessary, and I think create, um, bad policy and doesn't reduce smoking.

I'm 100% behind the T21 initiative, but I am not for raising the age of fines and penalties on 19- and 20-year-olds. I'll wait for any questions.

Representative Stapp. Thank you, Mr. Speaker. I support this amendment wholeheartedly, and I would ask for a little bit of indulgence from you and the Madam Rules Chair. Mr. Speaker, 6,939 days ago, I, I was unfortunately witnessed the, the murder of my company medic in Iraq 19 years ago, Mr. Speaker. So I tell the folks, this amendment what I, I, I would argue fixes a problem with the underlying bill.

The underlying bill would fine and punish individuals who were 20 years old and 19 years old for using tobacco or vaping with a fine from state government. That's not in line with the T21 provisions in the underlying bill. Mr. Speaker, like, I did my first deployment to Iraq in 2007. I was wounded in combat when I was 19 years old. I came back to Iraq, you know, or a lot from Alaska in December of 2007.

I had just turned 20, and during that deployment, Mr. Speaker, I, uh, even being an avid nonsmoker, I decided I would develop a habit for smoking. And Mr. Speaker, I tell folks, in the event that a municipal of Anchorage police officer or a state trooper had decided to issue me a citation and drag me into court for using tobacco when I was 20 years old because they decided that I was worthy of being fined, even though I was wounded in combat fighting in a war for the country, that interaction would have not gone well. So I ask the members that they should support this amendment, Mr. Speaker, because if you can go to war and fight for your country at the age of 20 and come home, it's kind of insane to say that the state of Alaska is going to punish you for using tobacco or vaping. Mr. Speaker, the underlying aspects of this bill is good. It puts us in line with the T21 federal rules, which means you can't sell tobacco to an individual or a vape product to an individual under the age of 21.

But I would just ask the members to support the amendment because the fundamental difference is the bill still bans the sale of tobacco or vape products to someone under the age of 21, but it doesn't say that someone who is 20 years old who already fought in a war for the country should be punished by the state of Alaska for being fined for using a product, Mr. Speaker. It's a really easy amendment to vote yes on, and I ask the members to support it.

Representative Josephson.

Could I first have a very, very brief adieu? Yes, brief adieu.

The House please come back to order. Representative Josephson. Well, I want to make sure the— I want to make sure the body is aware of a couple things, uh, because I think that the member from Ketchikan may have spoken inadvertently. He talked about a new penalty and he didn't sort of describe or delimit that to 19 and 20-year-olds. There—.

The penalty in this bill Hear me on this. The penalty on this bill, and it's not a crime, it's a ticket, it's a ticket. The penalty in this bill is reduced 80%, 80%, okay?