GOVERNMENT RELATIONS MEETING AGENDA Tuesday, October 27, 2015 | 8:00AM Chamber Office I. Call to Order / Establish Quorum – Derek Miller, Chair II. Call for Conflict of Interest Disclosures – Derek Miller, Chair III. Approval of the Agenda IV. Approval of Minutes A. September 15, 2015 Minutes V. Presentation A. Criminal Justice Reform - Jordan Shilling VI. New Business A. Criminal Justice Reform Priority (draft included in packet) B. Review 2015 priorities for relevancy C. Review proposed 2016 priorities D. Discuss special session advocacy plan VII. Unfinished Business A. None II. Other Communication A. Committee Attendance Report B. Committee Calendar C. Staff Report D. Committee Chair Report E. Committee Member Comments F. Guest Comments III. Next Committee Meeting – November 2, 2015
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GOVERNMENT RELATIONS MEETING AGENDA Tuesday, October 27, 2015 | 8:00AM
Chamber Office
I. Call to Order / Establish Quorum – Derek Miller, Chair II. Call for Conflict of Interest Disclosures – Derek Miller, Chair
III. Approval of the Agenda
IV. Approval of Minutes
A. September 15, 2015 Minutes
V. Presentation A. Criminal Justice Reform - Jordan Shilling
VI. New Business
A. Criminal Justice Reform Priority (draft included in packet) B. Review 2015 priorities for relevancy C. Review proposed 2016 priorities D. Discuss special session advocacy plan
VII. Unfinished Business
A. None
II. Other Communication A. Committee Attendance Report B. Committee Calendar C. Staff Report D. Committee Chair Report E. Committee Member Comments F. Guest Comments
III. Next Committee Meeting – November 2, 2015
Government Relations Committee Meeting Minutes Tuesday, September 15, 2015 | 8:00AM
Chamber Office
Call to Order: The regular meeting of the Government Relations Committee was called to order on Tuesday September 15, 2015 at 7:31AM by Derek Miller, Chair. Conflict of Interest Disclosure: Sarah Lefebvre disclosed that she serves on the Workers’ Compensation Board of Directors. Committee Members Present: Anna Atchison, Jennifer Bump, Sarah Lefebvre, Jenny Mahlen, Derek Miller, Sarah Obed and Tiffany Van Horn. Quorum was established. Committee Members Absent: Jeff Cook, Tammy Randolph, John Ringstad, Lorna Shaw and Rick Solie. Guests Present: None Staff Present: Lisa Herbert, Liz Wolfe and Elena Sudduth. Agenda: Hearing no objections, the agenda was approved as presented. Minutes of Previous Meeting: The minutes of the September 8, 2015 meeting had Sarah Lefebvre listed as absent. She was in attendance via telephone. Staff will make the correction to reflect her presence at the meeting. The Minutes were approved as amended. Presentation: None New Business: None Unfinished Business: The Federal issues survey summarized results need to be finalized and sent to the general membership by Friday. Staff will verify the numbers before sending it to the membership. Staff provided the committee with an updated version of the UAS priority, edited by ACUASI. Staff will email both the existing and proposed version to the committee. The Chair will speak with Mike Sfraga from the University for feedback on the UAF research priority as well as continue to work with him on a draft Alaska & the Arctic policy. The committee looked at the Worker’s Compensation priority and felt that the first bullet needs to be reworded, as the numbers make it sound confusing. Aside from that, the priority is current. The committee discussed how priorities are "ranked". The committee also discussed changing to an advocacy plan format in a effort to simplify our advocacy process. There has been some discussion with the committee chairs and so-far the conversation has been well received. Other Communication: The Executive Director reported that Ian Scott from the Association of Chamber of Commerce Executives is coming for the Alaska Chamber Conference and will have roundtable with the Executive Directors on the Horizon 2025 initiative. Pew Charitable Trust is also sending their chief staffer to speak during the Alaska Chamber and the Executive Director will try to schedule both of them for a BOD/Committee meeting on Monday at 8AM instead of our regular Tuesday meeting, to talk about criminal justice reform. Invite to be extended to Jordan Shilling and Senator Coghill to attend as well. Today is the deadline of the 7 Habits of Highly Effective people early bird pricing. Also the Health Fair is next Wednesday and American Red Cross Grand Opening on Thursday. The Chair reported that he, the Executive Director, the Board Chair and staff will attend the Alaska's Fiscal Future Conference on Saturday in Anchorage. Derek to forward an email that he received from Chad Hutchison with information on the gasline. A special session does not look likely at this time. If the Governor were to call a special session, he would have to act soon.
Next Meeting: The Chair reported that the committee will not meet next week. The next regular meeting of the
Government Relations Committee will be on Tuesday, September 29 at 8:00AM at the Chamber’s office.
Adjournment: The Chair adjourned the meeting at 7:56AM. Respectfully Submitted, Liz Wolfe Committee Coordinator
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Support for Criminal Justice Reform for the State of Alaska The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature, the Administration and state leaders to continue to address the growing need for prison reform in Alaska. The Fairbanks Chamber is prepared to join State leaders in the call for criminal justice reform, and support data driven changes that result in a more cost-effective criminal justice system for the State of AlaskaDe.
Support for the position Alaska’s prison population has grown 27 percent over the last decade, roughly three times faster than the state resident population has grown. The State spends over $300 million on corrections each year, the vast majority of which goes to brick-and mortar prisons and personnel. This spending has increased 60 percent over the last twenty years. Despite this increased spending, Alaska still has one of the highest recidivism rates in the country with two out of every three offenders released from prison returning within three years. The State Legislature funded the 1,500-bed Goose Creek facility, which opened in 2012, at a cost of $250 million to build, and $50 million annually to operate. Since then, Alaska’s corrections system is at 101% maximum capacity. Absent reforms, Alaska’s prison population is poised to grow by another 1,400 beds over the next decade. With this projected amount of growth we will soon need to build a new prison, start shipping prisoners out of state ($169 million over a decade), or invest in reforms that curb Alaska’s prison growth. Similar smart justice measures have been passed in states such as Texas, Georgia, South Carolina, and Utah. Business leaders in these states have supported criminal justice reforms noting that every dollar spent on new prisons is a dollar that might otherwise be spent on education, infrastructure, and economic development. Some possible benefits of successful criminal justice system reform include long-term reductions in operating budget costs, lower rate of crime and recidivism and building our workforce by improving re-entry success. Opposition for the position None identified at this time. Action Required of the Administration or Legislature Governor Walker, Senate President Meyer, Speaker Chenault, and the chairs of House and Senate Finance and Judiciary Committees have called for criminal justice reforms that curb corrections growth and spending, while protecting public safety and holding offenders accountable. They have directed the Alaska Criminal Justice Commission to develop recommendations for statutory and budgetary reforms for introduction during the 2016 session. The Commission is focusing on reforms in three main areas: pre-trial, sentencing, and community supervision. To guide this process, staff from The Pew Charitable Trusts are providing non-partisan data analysis and technical assistance. The Criminal Justice Commission will issue its report and recommendations with estimated fiscal impacts on December 10th. The Governor and legislative leaders will also consider investing some portion of the projected savings into treatment and programming that strengthen community supervision and support victims of crime. Fiscal Impact of the Position In September, President Meyer, Speaker Chenault, and House and Senate Finance Co-chairs tasked the Alaska Criminal Justice Commission with developing recommendations that avert all of the state’s future prison growth and reduce the prison population by up to 25%. The Criminal Justice Commission’s December 10th report will include a ten-year projection of the impact the recommendations will have on prison beds and estimates of costs avoided and net savings that would be achieved. A more exact estimate of these savings will be included in their Dec. 10th report.
Interior Alaska – The “Place” To Do Business 100 Cushman Street, Suite 102 | Fairbanks, AK 99701
Ph: (907) 452-1105 | www.FairbanksChamber.org
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Economic Impact of the Position Not identified at this time. Position Sponsor Information Greater Fairbanks Chamber of Commerce
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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2015 Greater Fairbanks Chamber of Commerce Legislative Priorities Adopted November 10, 2014 by the Board of Directors
Guiding Principles: A thriving economy depends on robust opportunities for business. The best thing that the Chamber can do for our members is to work to create a pro-business environment that encourages private sector investment and job creation. We are focused on the betterment of all of our members by working with local, state and federal government officials. For this reason, the Fairbanks Chamber will advocate and support public policies that are in alignment with the following guiding principles:
Support strong public and private education and workforce development opportunities
Support a sustainable state operating budget and strategic investments through the capital budget
Support a regulatory climate that encourages economic development
Support predictability in healthcare & workers’ compensation costs
Incentivize responsible development of Alaska’s natural resources
Encourage economic competitiveness
Top Priority: Reduce the High Cost of Energy
Support the Interior Energy Project: Construction, Expansion and Conversion
Support for a Natural Gas Pipeline
Support Affordable Energy for Rural Alaska
Additionally Supported Priorities:
Strengthen the Military Presence in Alaska
Support Worker’s Compensation Reform
Support Funding for the University of Alaska
Support the In-State Oil Refining Industry
Reinstate Funding for the Fairbanks Metropolitan Area Transportation System (FMATS)
Support Investment for Critical Maintenance & Facilities needs at Educational Institutions, K- 12
Support for the Alaska State Council on the Arts Funding Request
Increase Responsible Resource Development through the Permitting Process
Support Renewable Resource Development and Management (Forestry & Agriculture / Biomass)
Support Active Fish & Wildlife Management
Support Urban Rural Connection: Manley Hot Springs to Tanana Road
Support the Unmanned Aircraft Systems Industry
Support Creation of an Alaska Transportation Infrastructure Funding Program
Expanded position statements for above priorities are included on the pages 2-4.
Interior Alaska – The “Place” To Do Business 100 Cushman Street, Suite 102 | Fairbanks, AK 99701
Ph: (907) 452-1105 | www.FairbanksChamber.org
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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TOP PRIORITY: Reduce the High Cost of Energy
(GRC member: Rick; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce continues to support short-term, mid-term, and long-term projects to address the high cost of energy throughout the state. A significant amount of work has occurred in the Alaska Legislature, much of it related to energy. While a significant investment from the State was made during the 28th Legislature for a LNG trucking project, continued progress must be made to achieve affordable energy for Alaska’s residents and businesses.
Support for Interior Energy Project: Construction, Expansion and Conversion The Greater Fairbanks Chamber of Commerce continues to support the stated goals of the Interior Energy Project to bring affordable natural gas to the greatest number of Interior residents and businesses as rapidly as possible. The Chamber encourages AIDEA and AEA to finalize construction of an appropriately sized and configured LNG facility on the North Slope of Alaska, facilitate the expansion of natural gas distribution infrastructure in Fairbanks and encourage conversion of homes and businesses to a natural gas-based energy supply.
NOTE:
Fiscal impact to the state treasury is $________.
Support for Natural Gas Pipeline The Greater Fairbanks Chamber supports efforts on both natural gas pipeline projects from the North Slope to South Central Alaska: the State owned Alaska Gasline Development Corp project for in-state use and the ExxonMobil/BP/ Conoco-Phillips /TransCanada project to export gas to Asia. NOTE:
Fiscal impact to the state treasury is $________.
Support for Affordable Energy for Rural Alaska The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and Administration to support and expand efforts to reduce energy costs in our State’s Rural Communities by continuing to fund and support programs such as Power Cost Equalization (PCE), Emerging Energy Technology Fund and Renewable Energy Grant Fund programs. NOTE: The committee recommends adding a bullet under “support for the positon”
Affordable renewable energy options and practices would increase rural community health resulting in health related cost savings and improved productivity.
Fiscal impact to the state treasury is about $80M.
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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ADDITIONAL PRIORITIES:
Strengthen the Military Presence in Alaska The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to work with the United States military to not only maintain current military investment and force structure in Alaska, but to increase military missions, staffing, activity, and investment at Interior installations. NOTE: Military affairs committee does not recommend changes to the position statement for 2016. However, they have made a recommendation to add a bullet in support of UAS under action required. The UAS bullet reads:
Encourage the Alaska Legislature and the Governor’s administration to urge the DOD and USCG to
bring unmanned aerial systems (UAS) to Alaska and to coordinate with the Federal Aviation
Administration and the University of Alaska-Fairbanks UAS Test Site to safely integrate UAS into the
National Airspace System in Alaska.
Fiscal impact to the state treasury is $0.
Support Workers’ Compensation Reform The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to enact reform to the Workers’ Compensation Statutes to improve the balance between providing quick, efficient and fair compensation to injured workers at a reasonable cost to employers. The current system is delivering benefits at exorbitantly high costs to employers, and ineffectively administers the claims of injured workers. NOTE: Fiscal impact to the state treasury is $0. Support Funding for the University of Alaska
(GRC member: Derek; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to maintain strong support and funding for the University of Alaska. A healthy university is vital for the education of our citizenry, the development of a highly trained workforce, and the research and development endeavors necessary to address the state’s critical challenges. Specific support includes:
Funding necessary to complete the UAF Engineering Building
Research & development endeavors
Deferred maintenance
NOTE: Fiscal impact to the state treasury is $______.
Support the In-State Oil Refining Industry
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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In-state refining adds important diversification and value added processing to our Alaska economy. The in-state refining industry is currently challenged with high energy costs, terms of the State royalty oil sales contracts, quality bank provisions and environmental and operational regulations. The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to develop and implement a comprehensive action plan to mitigate these impediments, thereby allowing for the preservation and expansion of in-state refining. NOTE: Natural resources committee recommends removal of this priority because the position was taken in 2014 when Flint Hills was looking at closing their North Pole refinery. The intent of the position was to keep the refinery open and supplying products for the Interior. It has now been closed and no efforts are being made to reopen it. Additionally, there are no plans currently being worked to expand other In-State refineries or build a new refinery in the Interior. Fiscal impact to the state treasury is $0. Reinstate Funding for the Fairbanks Metropolitan Area Transportation System (FMATS)
(GRC member: Sarah L.; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to reinstate funding for the Fairbanks/North Pole Metropolitan Area Transportation System (FMATS), vital to positioning the area for successful economic development. Economic growth requires a good local transportation infrastructure to support new and continuing development. NOTE: Fiscal impact to the state treasury is $______. Support Investment for Critical Maintenance & Facilities needs at Educational Institutions, K – 12
(GRC member: TBD; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to support a major investment in the substantial backlog in critical maintenance needs at K-12 school district facilities. Serving the needs of students throughout Alaska, from urban centers to rural villages, requires a wide variety of facilities. The School Districts are responsible for the annual maintenance and repair of facilities, but budgets have been squeezed in recent years due in part to the rising cost of energy. NOTE: Fiscal impact to the state treasury is $_______. Support for the Alaska State Council on the Arts Funding Request
The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and Administration to support continued funding for the Alaska State Council on the Arts. NOTE: Business & the arts committee does not recommend changes to the position statement for 2016. Fiscal impact to the state treasury is $800,000.
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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Increase Responsible Resource Development through the Permitting Process
UPDATE: The Greater Fairbanks Chamber of Commerce supports a significant increase in responsible natural resource development and encourages the Alaska State Legislature and Administration to uphold Alaska’s strong regulatory and permitting laws and policies that will facilitate additional exploration, site development, employment, infrastructure, research, and natural resource production in Alaska. The Alaska State Legislature should work with the Alaska Congressional Delegation to address the multitudes of Federal laws that adversely impact natural resource development in Alaska and elsewhere. PROPOSED CHANGE: The Greater Fairbanks Chamber of Commerce supports responsible natural resource development and encourages the Alaska State Legislature and Administration to uphold Alaska’s strong regulatory and permitting laws and policies that will facilitate additional exploration, site development, value-added services and products, employment, infrastructure, research, and natural resource production in Alaska. The Alaska State Legislature should work with the Alaska Congressional Delegation to establish permitting efficiencies within Federal laws that incorporate measures to lessen environmental consequences and that support sustainable natural resource development in Alaska. NOTE: The Natural Resources Committee recommends the position language be updated to focus more heavily on improving efficiencies for the permitting process that will encourage resource development. Fiscal impact to the state treasury is $0. Support Active Fish & Wildlife Management
(GRC member: John; deadline for updates COB 10/8) UPDATE: The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to advocate for the wise management of Alaska’s fish and wildlife resources. Alaska must responsibly balance subsistence, commercial, personal use, sport, and other recreational uses to maximize long-term social and economic benefit. Proactive management actions should be used to provide fish and wildlife population abundances necessary for long-term and maximum use under the sustained yield principle. Finally, the Alaska State Legislature and State Administration should work with the Alaska Department of Fish and Game to monitor and advocate for the special provisions of the Alaska National Interest Lands Conservation Act (ANILCA) that are unique to Alaska and to insure that state interests and public access to fish and wildlife resources are adequately considered. NOTE: The Natural Resources committee recommends that this position be simplified and combined with their existing priority titled “Support Renewable Resource Development and Management” Fiscal impact to the state treasury is $________. Support Renewable Resource Development and Management
(GRC member: John; deadline for updates COB 10/8) UPDATE: The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to proactively support and encourage the development and sound management of our forest and agricultural resources. Progressive economic access to local agriculture and forest resources will play an increasing role in the viability and lifestyles of Alaska’s growing population.
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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NOTE: The committee recommends that this position be simplified and combined with their existing position titled “Increase Responsible Resource Development through the Permitting Process”, keeping the current title. Fiscal impact to the state treasury is $0. PROPOSED CHANGE: The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to advocate for sustainability and sound stewardship for future generations when pursuing the development and balanced management of our State’s renewable resources including agriculture, forestry, and fish and game. Fiscal impact to the state treasury is $0. Support Urban Rural Connection: Manley Hot Springs to Tanana Road
(GRC member: TBD; deadline for updates COB 10/8) UPDATE: The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to support the development of an infrastructure corridor from the Interior to the community of Tanana. This infrastructure corridor would greatly enhance the connectivity, economic viability and well-being for the communities of Tanana, Manley Hot Springs, Minto and numerous rural communities along the Yukon River corridor. PROPOSED CHANGE: The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to support the continued development of the infrastructure corridor from the Interior to the community of Tanana. This infrastructure corridor will greatly enhance the connectivity, economic viability and well-being for the communities of Tanana, Manley Hot Springs, Minto and numerous rural communities along the Yukon River corridor. NOTE: The committee recommends some language changes to the position statement. Fiscal impact to the state treasury is $10 million. Support the Unmanned Aircraft Systems Industry
(GRC member: Derek; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce recognizes the importance of the Unmanned Aircraft Systems (UAS) Industry and encourages the Alaska State Legislature and the Administration to continue to support efforts that foster industry growth. The UAS industry will aide in the diversification of our economy, strengthen technology programs with the University and create jobs that can transform Alaska. NOTE: Fiscal impact to the state treasury is $________.
Support Creation of an Alaska Transportation Infrastructure Funding Program
(GRC member: Sarah L.; deadline for updates COB 10/8) The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature and the Administration to create a State funded program for capital improvements to our transportation systems. The program should cover renewal, replacement and development, to enhance Alaska’s land, water and air transportation systems. This infrastructure is pivotal to the State’s economy, providing access to markets, supplies and resources.
GREEN = Okay as written RED = Recommend removal BLUE = Recommend update ORANGE = Recommended co
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Improving and investing in the transportation system will improve the competitiveness of businesses and economic opportunities for Alaskans. NOTE: Fiscal impact to the state treasury is $________.
Page 1 of 2
2016 Greater Fairbanks Chamber of Commerce Proposed Legislative Priorities
Support a comprehensive, long-term sustainable fiscal plan for the State of Alaska The Greater Fairbanks Chamber of Commerce encourages the Alaska State Legislature, the Administration and state leaders to ensure the effective use of state resources by delivering essential programs as efficiently as possible and to make strategic investments that promote long-term economic growth. Further, the Chamber encourages government leaders to build a fiscally responsible budget that aligns revenues with expenses. While reductions have already been made to the state capital and operating budgets, a consistent and predictable fiscal policy is integral to an overall plan and vision for business development and job growth in Alaska. Adopted August 24, 2015 by the Board of Directors -------------------------------------------------------------------------------------------------------------------------------- --
Sustain and increase, as necessary, transportation revenue that will support maintenance, enhancements and efficiencies to Alaska's transportation infrastructure. The Greater Fairbanks Chamber of Commerce encourages the State to leverage existing and future state funding sources to the maximum extent possible, while pursuing alternative funding sources and mechanisms that will ensure the greatest possible benefit to Alaska’s infrastructure. Maximizing repairs and upgrades with available funding, and leveraging other funding sources, should be a priority approach given the severe budget restrictions facing Alaska. The Fairbanks Chamber also encourages the state to evaluate its transportation funding, design, construction and maintenance practices to identify and adopt the most efficient and the most cost-effective methods available. Support for the position This is a broad based issue affecting Alaskan residents and businesses in many ways. The cost of disregarding infrastructure needs should not be ignored and will only continue to increase over time. The position is specifically supported by the contracting community, heavy users of transportation systems, such as trucking companies, organized labor, and by businesses that intimately rely on transportation to function on a daily basis. The State has few redundant transportation corridors, and the condition of each is crucial to the movement of goods and services, in addition to the traveling public. Each community, whether urban or rural, is dependent upon some combination of highway, aviation, rail and marine infrastructure for access to the remainder of the State. As Alaska’s infrastructure ages, it is imperative that the backlog of necessary maintenance and repair work not increase. This financially impacts every resident of the state, now through delays and damage, and in the future through higher costs and reduced access. Enhancements to Alaska’s transportation infrastructure facilitate continued economic growth and access to resources. The data is concerning:
1. 49% of Alaska's roads are in poor or mediocre condition 2. driving on roads in need of repair costs Alaska's motorists $181 million per year in extra
vehicle repairs and operating costs, averaging $389 per motorist
Interior Alaska – The “Place” To Do Business 100 Cushman Street, Suite 102 | Fairbanks, AK 99701
Ph: (907) 452-1105 | www.FairbanksChamber.org
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3. 290 of the 1,196 bridges in Alaska are considered structurally deficient or functionally obsolete
4. rural airports produced $4.9 million in revenues, mostly from lease fees, against costs of $23.2 million
The Fairbanks Chamber understands and supports the need to sustain and increase funding for maintenance and operation of Alaska's highway, aviation, rail and marine infrastructure, as well as the need to fund enhancements to infrastructure to further stimulate existing commerce and foster economic growth. Opposition for the position None identified at this time. Action Required of the Administration or Legislature The Fairbanks Chamber encourages the Alaska State Administration and Legislature to make available and/or increase sufficient funding to maintain existing transportation infrastructure at an acceptable level that will continue to expand and improve Alaska’s infrastructure to accommodate and promote economic growth and development. Fiscal Impact of the Position Not identified at this time. Economic Impact of the Position Not identified at this time. Position Sponsor Information Fairbanks Chamber Transportation Committee
Summary Report on the Review of the AKLNG Project Process Page 1
Summary Report on the Review of the
Alaska LNG Project Process
Office of the Governor
State of Alaska
September 24, 2015
The following report summarizes the results of a review of the process established for the
proposed liquefied natural gas (“LNG”) project currently being worked on by the State of
Alaska, TransCanada, ExxonMobil, BP, and ConocoPhillips under the negotiating framework
most recently enacted in 2014 by Senate Bill 138: the Alaska Liquefied Natural Gas Project
(“AKLNG Project,” “AKLNG,” or “Project”). The majority of challenges are structural and
commercial in nature rather than technical. The report will first discuss the history of prior
Alaska gas pipeline development efforts, and then the commercial difficulties faced by the
AKLNG Project.
I. HISTORY OF EFFORTS TO COMMERCIALIZE NORTH SLOPE GAS
The current configuration of the AKLNG Project is the latest in numerous efforts to export North
Slope natural gas dating back to the 1970s. This section of the report discusses those efforts in
context of the current AKLNG Project and what can be learned from those prior unsuccessful
attempts.
A. Early Projects
Prior to the mid-1980s, there were efforts to advance several different Alaska gas pipeline
projects, including those by Prudhoe Bay leaseholders BP, Atlantic Richfield and ExxonMobil
(together with successor companies, the “Producers”), and separately by El Paso and Foothills (a
predecessor to TransCanada). These attempts reflected, among other issues, the two competing
themes consistently present in North Slope gas commercialization efforts.
First was the ongoing debate about whether a project should be a North American project
through Canada or an LNG project to tidewater in South Central Alaska. For instance, in 1977,
the Carter Administration determined a project should go through Canada, and Congress enacted
the Alaska Natural Gas Transportation Act to enable the same. Competing national priorities –
based largely on ever-fluctuating Lower 48 gas prices and estimated gas supply – saw seesawing
support of a Canadian and LNG project. The Reagan and George H.W. Bush Administrations
September 1: Alaska Bankers Association by Steve LundgrenSeptember 8: University of Alaska System by President Jim Johnsen
September 15: Unmanned Aircraft Systems by Ro Bailey
September 22: United Way Campaign Kick-Off by Bill & Meadow Bailey
September 29: Fairbanks North Star Borough Mayoral Candidate Forum and debate *Location - Pioneer Park Civic CenterOctober 6: State of the Fairbanks North Star Borough School District by Dr. Karen Gaborik
October 13: Joint luncheon with Alaska Chamber featuring Alaska Arlines
CEO Brad Tilden *Location - Westmark Hotel Gold Room
CREDIT CARD ONLY; RESERVATIONS REQUIRED
October 20: Energy Efficiency: An investment opportunity you can’t afford to delayOctober 27: Doing Business with BP
November 3: Excellence in the Workplace by Pat McGaughey
November 10: Education’s trajectory by Commissioner Mike Hanley
November 17: U.S. Chamber of Commerce: Environment, Technology & Regulatory Affairs Division by Bill Kovacs
December 1: In Progress
December 8: Annual Membership Meeting last meeting of 2015 Register now on Fairbanks Chamber’s event calendar
$20/person for members, $25/person for general public *includes lunch buffet $160/table of 8 *includes lunch buffet $5 program fee *includes coffee and water service only