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The Special Session continues into the fourth and final week as the only item-the AKLNG bill passed the State House by a vote of 34-5. It now moves on to the State Senate where it will get a strong review in the Senate Finance Committee and then on the Senate floor before adjournment on Friday, June 19.
It is my hope that a natural gas pipeline can become a reality this time but I have some major concerns about the bill before the Senate and how it will ultimately impact life for Alaska families. The current version of the bill would transfer a significant amount of risk and costs to locals in an attempt to make the AKLNG more attractive to outside investors and the private equity markets on Wall Street. In an ideal world, cost overrun risks would be borne by the pipeline company, but these extra costs could find their way into the overall price of gas to the consumer through an increased tariff.
One item that was made better in the current version of the bill is that a small, spur line was added to the overall cost of the AKLNG and will be spread over the value of the entire project. Thanks goes to my Democratic colleague and Co-chair of the House Resources Committee, Rep. Maxine Dibert who made sure that Fairbanks would be protected. Earlier versions of the bill would have made local Fairbanksans pay for the entire infrastructure of the spur line which would cost nearly $500M. The Senate will look to tighten the language to ensure that the spur development is done in a timely manner for residents of Fairbanks.
Another item that was very important for me to support any version of the AKLNG project was an enforceable Project Labor Agreement for construction of the pipeline and related facilities. A PLA is a bargaining agreement between the project manager and unions to ensure that there are standardized work conditions, wages and dispute resolutions. A PLA also is the best way to ensure that local hire provisions are observed and Alaskans must be the first in line for any jobs. I am encouraged by a Memorandum of Understanding signed by the AFL-CIO and Glenfarne, but this should be rolled into the primary legislation while in the State Senate.
If you have any comments, questions or concerns, please contact me directly at senator.scott.kawasaki@akleg.gov!
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