🧵 The House is underway with amendments to Senate Bill 180. It originally dealt with LNG import facilities, but under an amendment by Majority Rep. Chuck Kopp would just shove the entire AKLNG project bill into it. His introduction is EXTREMELY on message: Freedom, energy, affordability. #akleg
www.ktoo.org
Rep. Kopp says that his amendment borrows from all the different versions advancing, and it's what the AKLNG project wants, so therefore it's good. While he's the majority leader, he's extremely pro-industry.
It doesn't address corporate income taxes. Kopp opposed the s-corp fix. He says the state will still get income taxes from the companies that are taxable that sell gas into the pipeline. Basically, it sounds like Kopp's version cuts the legs out from the version that his Majority has otherwise been working toward. Basically, a bigger subsidy than what the rest of the majority had been aiming to. Rep. McCabe: "We need to make a decision today. Whether we want to move forward or pull back." He's talking about a multibillion-dollar multi-decade subsidy for a project that the legislators have basically no insight into. Sooo.... basically they're resorting to the: "What are you, a chicken?"
I wonder how many of these guys are gonna have jobs with the AKLNG project in a couple of years. Rep. Fields says that despite the "severe" time constraints, lack of information and lack of project details, he's supportive of the alternative.
It's hard to digest the whole thing right now, but there's also a provision that would funnel money into the constitutionally protected education fund, which is awaiting a vote in the Senate. That'd send it to voters to consider. Rep. Fields says he still has his skepticism, says a lot of it is outside the state's power: "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."
Fields also says it's important for legislators to be transparent that HIGHER energy costs are within the range of outcomes if the pipeline gets built but the high-volume international buyers don't materialize. The build-it-and-they-will-come approach could leave AK with a way-too-big pipeline. Legislating on the floor, what can go wrong? Lengthy at ease.
aw, geeze, they banned lotus field?!? (this is a joke about magic the gathering bans that were announced today)
Is Kopp's amendment super oily industry? Is it a workable compromise? Does it address local impacts? Are the subsidies actually warranted? Who knows! Rep. Gray rises to oppose the part of Rep. Kopp's amendment that would remove the Susitna River Power Project from the bill. He says the AKLNG pipeline is going to add to global climate change, so they should also be pursuing alternatives.
Rep. Carrick says she's generally in favor of a AKLNG pipeline but that she's wary about the on-the-fly process. She warns that the state shouldn't give away the farm for a project that doesn't pencil out for the state or its residents.
Rep. Holland is supportive of the amendment. He says, though, they need to be thoughtful about preparing the state to be ready for the project, talking about the need to invest in infrastructure and job training.
Rep. Holland is also on the fiscal stability train. He says that messing it up now, will require them to fix it later, throwing uncertainty into the future. Basically, get it right now versus messing it up and fixing it later.
Another at-ease.
The deets for the amendment: 6c throughput tax (AKLNG's favored rate) 5-year ramp-up period (AKLNG favored) $40M impact fund (House favored) Fairbanks spur line tax breaks I think the throughput tax is probably the biggest sticking point. House Resources had a 15c/mcf tax. This is 6c and 12c on gas that goes through the treatment facilities. Senate has been modeling in the lower numbers between 8-12c. And now we're getting a bunch of Rep. Kopp amendments to Rep. Kopp's amendment. First one is clean-up on something dealing with education funding. The next would change Rep. Galvin, whose husband is an oil and gas executive: "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, when it passes." There's an objection (as there always is), so she'll get to vote.
Speaker Edgmon notes they have 22 amendments to Amendment 2. He says that it's gonna make today's debate confusing, so he's gonna give people a lot of lattitude on it.
After Galvin says that she has a "deep conflict" that she's "all about the gasline," and encourages everyone to dig deep to advance this subsidy for the AKLNG project. Again, for a project for which "my family stands to gain substantially."
This amendment would raise the inflation adjustment for the throughput tax from 1% annually to 2% annually. Rep. Frier, who oversaw the bill as chair of Resources, says she objects to it being capped at all. She says it should just stick to the actual inflation rate, rather than keeping it up. Rep. Kopp says 1% doesn't keep up with inflation, and they'd eventually get underwater. To be clear, 2% doesn't keep up with inflation, either. He says that's "fair" to the AKLNG project.
And despite the concerns that a 2% cap on inflation-related increases won't actually keep up with inflation, the amendment passes 29-11.
AM 3 not offered. Rep. Ruffridge moves AM 4 to AM 2. It'd delete ANY language related to funding education. He says that AKLNG subsidies shouldn't be bogged down by K12 education. He says they shouldn't be thinking about where the revenue goes because they're not getting any revenue today anyway.
Rep. Fields opposes it. He says the purpose of the education fund is clear. "It's imperative that we show the whole state how the far-flung areas will benefit from this project." He also says removing the ed fund language may very well kill the bill.
Ketchikan Republican Rep. Bynum says, sure, schools are important, BUT they need to promote the AKLNG project in every possible way. He says that schools can wait.
Rep. Kopp supports the amendment, calling it a friendly amendment. He says the communities will still benefit from the AKLNG project through local impact aid payments. If people care so much about k12 funding, he says, they can revisit it in the future.
I believe the technical term for this is a cluster. The only way this could be worse public process is if it was happening after 11 p.m.
And now we're at the part where people are trying to explain their way through what's happening.
Rep. Elam also supports eliminating education funding from the AKLNG bill. He says it's important for them to have a "good, clean bill." Rep. Saddler says his SINGLE goal is helping the private companies build the AKLNG pipeline. He calls education funding "a ride-along." He says libs love k12 $.
Get fucked, education funding: They remove the language that would have sent some money to a yet-to-be-established dedicated education fund. 23-17. Majority Reps. Kopp, Hannan, Foster cross over.
AM 6 to AM 2 passes 38-2. It had something to do with the property tax assessments.
AM 7 to AM 2 by Rep. Holland would put a 30c per barrel tax on oil in order to pay for the Dalton Highway. He says it's important for the industry to pay for itself.
Rep. McCabe says, sure, the Dalton Highway needs significant additional maintenance, but why tax the oil companies? He says lawmakers should simply put more of the state's money into the Dalton Highway. "The Dalton Highway deserves its own respect."
Rep. Kopp also opposed. He says he's against taxing the industry to pay for the infrastructure it uses. He's also against a provision that would bar the providers from using the AKLNG costs against their oil taxes. He says that's a "non-starter." (For who? The state? Billionaire investors?)
Rep. Holland says that $70M a year of Dalton Highway maintenance is right around the corner. They're going to have to pay for it one way or another. He says without it, they're going to have to cut elsewhere.
And they're going to have to cut elsewhere to pay for infrastructure primarily used by the industry. Holland's amendment fails 17-23 with majority Reps. Frier, Jimmie, Kopp and Stutes cross over against it.
Rep. Holland's next amendment would cap the citygate gas prices at $12 per MCF if the export terminals aren't built. It'd then cap it at $5 once the project is underway. He says that these are the assurances that they've been giving, so why not lock them into them?
Also, oops, I've gotta run off to take the dogs to the vet at 1220. I blanked on getting them scheduled regularly, and the vet had an opening, so I'll probably be gone an hour or so. Rep. Holland says that the whole point of the project is to protect Alaskans from overruns. He warns that Alaskans can get really screwed if the prices don't go forward. Rep. Kopp is in "strong opposition" to any sort of price limits. He says it should be left to the private sector to decide what Alaskans pay for energy. Kopp says utilities aren't asking for the limits. (Well, sure, utilities pass costs along one way or another. Why not ask the ratepayers?)
Rep. McCabe says price-fixing is anti-freedom and anti-capitalism. He then compares it to the Anchorage Assembly's limit on hat prices at $10. Asks if anyone would ever open a business. (It should be noted that Anchorage hat shops aren't getting multi-billion-dollar multi-decade state subsidies)
Rep. Gray supports the amendment. He notes that the process so far has been to protect multi-billion-dollar companies, not Alaska residents. He noted they capped inflation to 2%, knowing it wouldn't keep up with inflation, protecting the companies, why not Alaskans?
Rep. Mears says the AKLNG project has momentum in large part becuase of the rosy promises its made on the final cost to Alaskans and protecting them from cost overruns. "This amendment helps the project keep its promises."
Alright! I'm off to the vet with the dogs (just annual check-up and a re-up of Mr. Tuco's arthritis treatment). I'll keep an ear, but will be gone for about an hour or so. Alright, I'm back and they're still discussing the amendment to cap LNG prices. Rep. Holland closes by saying, sure, price caps may be unusual in the private sector, but it's also unusual for the private sector to get a massive govt subsidy. "Why shouldn't Alaskans have this same benefit?" Rep. Holland's amendment, placing price protections on the AKLNG project, limiting gas to $12 if the key export facility isn't built and $5 if it is (aligning with AKLNG promises), fails 14Y-26N. Majority Reps. Carrick, Dibert, Galvin, Hall, Kopp, Schrage and Stutes split to vote against. #akleg
Eating some lunch, but, man, the AKLNG boosters sure have their talking points down pat. Rep. McCabe then insists the oil industry has NEVER gotten a subsidy from Alaska. "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."
Then McCabe, just saying crazy shit now, says that the AKLNG pipeline will be operating for 100+ years. So, therefore, they should not have to revisit the tax rate. So, what's becoming clear, though, is that a lot of the amendments being brought by Rep. Holland so far are coming from the Senate. That's because the Senate is only gonna get a concurrence vote. Basically, the ultimate ram through. And the amendment to put a sunset date in the bill, requiring future legislators to review and renew the AKLNG tax breaks after 10 years, fails 18-21. Reps. Stutes and Kopp break from the majority, again.
Rep. Josephson has Amendment 2, rewriting how the $40M impact fund is applied to the project. He notes the problem is that the whole impact fund leaves the $40M in the developers' hands, in their account and at their discretion. He says it's wiser to have it done by the state. Rep. Kopp doesn't oppose this one. He says he's checked with Glenfarne, and they're cool with it, so he's cool with it. "So, based on confirmation that this is an administrative headache to the developer, and they're very happy with this amendment, I have no problem with it. I support it."
At ease. Again, I know it's not anything new, but it's still kinda bizarre to me to have legislators essentially acting as agents for AKLNG.
Lol, oh right, today is the deadline for the governor to issue his veto of the pension bill. Rep. Kopp explains that they're gonna keep the door open til midnight for a veto. Which, man, that feels a little bit like they're hoping to trade the AKLNG project for the pension bill, right? #akleg
The amendment establishing local impact aid as a state-run program rather than a developer-run one passes without objection. Rep. Josephson has another amendment tweaking how the revenue would be collected and shared throughout the state. Unsurprisingly, the AKLNG crew is opposed. Rep. Josephson's local impact amendment for the AKLNG project fails 16-24. Reps. Fields, Dibert, Kopp, Mears, Stutes break from the majority, again.
Rep. Eischeid runs another amendment that would fix prices. He says they should keep their promises to legislators.
Rep. Kopp and Ruffridge are, unsurprisingly, against the amendment. Kopp says that they NEVER promised Alaskans would get cheap gas no matter what. Kopp says everyone understands that prices could be much higher if they don't find people other than Alaskans to sell gas to. At-ease.
Rep. Mears offers another amendment seeking to try to protect the ratepayers from getting gouged. It'd limit the amount of tariffs Alaskans can be charged.
Rep. Kopp is also in "strong opposition" to the price protections. He says that utilties are ALREADY protected by the utilities -- who he says only care about keeping costs down -- and also the RCA protects them.
Rep. Mears on an amendment to regulate the LNG treatment facilities. She says it's important to protect Alaskans: "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."
It fails 17-23. Majority Reps. Fields, Galvin, Kopp and Stutes vote against, again.
Rep. Frier has another amendment to sunset the tax breaks if they don't complete the export facilities on time. Rep. Kopp, who's carrying the water for Glenfarne, says, well, you can't really require them to stick to their schedules. Things change, so the 2 years beyond their promise is too tight.
Rep. McCabe says that anything might happen and leave the state without an export facility -- like a big war -- that it's not their fault, and they shouldn't have given up their tax breaks. (If they don't build the export facility, Alaskans get stuck with expensive gas)
And Rep. Frier's amendment that would sunset the tax breaks if the AKLNG project doesn't start construction on a key export facility within at least two years of when they promised it would be finished. It goes 20-20, with only Rep. Kopp, R-Glenfarne, as the lone member of the Majority to vote no.
Rep. Ruffridge has a big ol' sprawling amendment. It would basically help the private companies involved hide their activities from public oversight. "This allows more confidentiality," he says. He says transparency could harm the project.
Another part of Ruffridge's amendment would also reduce legislative oversight of the project, limiting the information legislators receive. Basically, it'd give the state AGDC pretty broad authority to invest in the AKLNG project WITHOUT legislative approval or, really, oversight. Rep. Kopp, unsurprisingly, is also a fan of limiting public oversight of the AKLNG project. "This amendment really balances transparency with the commercial process." He says even though the AKLNG would be ceding much of their decisionmaking, it'd still require AGDC to provide timely updates. 🙃
Rep. Mears says that this amendment would undercut the Legislature's already-limited oversight of the project. Rep. McCabe, a legislator, says he cannot think of a worse group of people to make decision about the AKLNG project as legislators. He says they should give AGDC blanket secrecy powers.
Rep. Gray notes that there are changes in this that seem to be trying to make it illegal for anyone to disclose any of the information relating to the project: "So, journalists have no rights?"
Rep. Ruffridge says the underlying issue is the balance between "business and transparency." He says, basically, all that legislators need to know is whether or not the pipeline will be built. He says you can take their word for it. He says that's all legislators, like him, should get to know.
And Ruffridge's amendment rolling back the transparency measures on the AKLNG project passes 22-18. #akleg
Then there's an S-corp amendment. The Republicans fall back basically on a "Don't TARGET precious little Hillcorp!" They say you can't tax them unless you also go after S-Corps like dentists, etc. Rep. Kopp loads the praise on Hillcorp, saying they're saving the state's industry!
Rep. Kopp says it's not fair to start taxing Hillcorp on its corporate profits (of which it pays none to Alaska) because they came in not expecting to get taxed. (They did, in fact, expect to get taxed and said as much.)
Rep. Gray starts talking about a hypothetical about inviting someone into your backyard and paying them "Because it's my treasure, and I'm letting you sell MY treasure."
Rep. Saddler takes offense to the idea that the tax would get any thing more than the royalty tax. Of course, he's a shitty piss baby about it, which leads to a lengthy at-ease.
Oh my. He came back and gave a shitty "If you took offense" apology. Clipping the video now. The amendment failed, of course. Then bluesky went down for a while. A tough one for the Fairbanks crew. An amendment that would give the FNSB a little better control over the spur line -- the 30-mile connector that's needed to save some money on the big pipeline -- gets voted down 6-33.
Also, I haven't really been listening super close, but I don't think the call got lifted, did it? Minority Leader Johnson is MIA Another Fairbanks-focused amendment goes up in smoke:
Onto another amendment dealing with how the local communities can/will benefit from the bill. Rep. Kevin McCabe says it's cute that other legislators are advocating for their communities, HOWEVER "What the free market does for itself will benefit the local communities." He says they'll benefit in the form of property taxes from people moving in.
And then the "How About Anchorage" amendment fails on a 15-25 vote.
Rep. Schwanke: "Industry is the place where capitalism is born. The government is not here to create industry or jobs." She says in support of a multi-billion-dollar, multi-decade tax break. A subsidy, some might say, but not Republicans, because it's not cash, just forgoing cash.
Rep. Holland says that directing money into long-term economic development is important. He says Alaska doesn't invest in business development: "We're sitting here giving an empty bag to the businesses who could really leverage this opportunity."
Aaaand Alaska will continue to not invest in economic development by an 18-22 vote.
Rep. Frier has another amendment that she wrote out by hand. She says she took her time, so she hopes everyone can read it. It is basically language stating that the AKLNG bill is NOT intended to influence the TAPS valuation in any way.
The TAPS valuation is a big-ticket item right now. How do we value a piece of infrastructure like that? Is it the replacement price? Is it based off the life of left of the oil fields? Some BG:
www.northernjournal.com
After a lil break, they return and accept the amendment without objection. Not a problem for Glenfarne, so it's not a problem for the pro-industry lawmakers. Rep. Dibert has an amendment that's focused on making the Fairbanks spur line work a little better for everyone (aka more than just Glenfarne and company). Of course, the pro-industry Republicans are not fans.
Rep. Stapp comes to his fellow Fairbanks Rep's defense, arguing that the changes are sensible and would protect the Fairbanks area from getting gouged on the rates. Basically, the 30-mile spur is stupid expensive for the relatively few customers it'd serve, so they gotta spread the cost out better.
Glenfarne musta gave the thumbs-up. The Fairbanks-focused change is accepted without objection. Onto Amendment 37. Rep. Carrick moves an amendment making the bill's passage contingent on HB78 becoming law. It's the pension bill that Dunleavy has until midnight tonight to sign or veto. Coincidentally, the House set the deadline for him to decide by midnight tonight.
The amendment is ultimately withdrawn, but Rep. Stapp says he appreciates Rep. Carrick "for telling the public what exactly is happening here."
The next amendment is by Rep. Ruffridge. It would inject the loyalty lease terms bill for the Kitchen Lights unit. That bill had itself picked up the s-corp loophole change, which sank the whole thing with the House (which is more oily than the Senate). So they're trying to skirt the issue. There's now some legal questions a bout whether or not lumping in a bill fromt he House Rules Committee is proper or not. And whether or not they need to hold a vote on it. I'd imagine that the anti-tax crowd would probably overrule them at this point. Anything but taxing Hilcorp. sigh, i must admit that sometimes it might be helpful to be there in person. dispatch from the other place:
looks like it may be an extended break, so i'm gonna go pop out for a bit and get some fresh air with the pups
Alright, while I was gone, they approved an amendment from Rep. Frier that would allow the North Slope and Kenai Peninsula boroughs to negotiate directly with the option to take a stake in the project. A big point for Rep. Frier, whose communities have benefited greatly from TAPS. 21-19.
Rep. Bynum um-actually objects to the amendment, saying that it's not valid because it refers to a different part of the amendment that has already been removed from the bill. He says ya gotta undo it or do an alternative fix. Then Rep. Kopp moves to rescind the amendment.
The motion to rescind the vote fails 20-20. It honestly looks like Rep. Johnson wasn't paying attention and hit no. Can they redo the vote to redo the vote?
Another long at ease. Guys, I don't think they're gonna make it to midnight. I don't know if I'm gonna make it to midnight.