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State senate votes to reallocate NPR-A grants Bill would have Legislature allocate impact grant money; defenders say administration has already tightened application process By Anne Sutton Associated Press Writer
The state Senate has approved a reallocation of revenues from the National Petroleum Reserve-Alaska despite protests from communities impacted by nearby oil and gas development.
The state receives 50 percent of the federal revenues derived from oil and gas lease sales on the 23.5 million acre reserve along the Arctic Coast.
Those revenues are deposited into a special fund to be used to mitigate the impacts of exploration and development on nearby communities.
But bill sponsor Sen. Gary Wilken, R-Fairbanks, says the method of divvying up the grants is flawed.
His bill would set up a legislative subcommittee to review the grant applications, a job currently being done by a panel of three at the Department of Commerce, Community and Economic Development.
Wilken says the committee would balance advocates and those with “boots on the ground” knowledge of the area to decide where the need exists.
Wilken has questioned whether many of the grants address oil and gas development impacts. The projects cover everything from boat launches, to police officers to wildlife studies.
He describes his legislation as a “watershed bill” that allows the state’s oil bounty to “meet the needs of not just some, but all communities.” Olson fears politics will replace policy But Sen. Donny Olson, D-Nome, said a legislative committee would be more likely to base its decisions on politics rather than policy and it could be made up of people who are not familiar with the area or with grant programs in general.
He said the commerce department already addressed the concerns about the grant program last year when it tightened regulations that guide how the money is handed out.
Olson told lawmakers the state needs the cooperation of the North Slope to help open up the area to oil drilling “instead of pointing them out and alienating them with legislation such as this.”
Over the last six years, the program has brought $112.4 million to the state, of which 75 percent went to the communities and 6 percent to the Permanent Fund.
Four communities and the North Slope Borough have divvied up from $1.5 million to $28 million in grants each year for the last six years.
That amount is expected to jump as the federal Bureau of Land Management opens up new areas for exploration. And Wilken told lawmakers now was the time to prepare for what promises to be a substantial influx of new revenues. Bill requires 25% to Permanent Fund The bill also requires 25 percent of the federal revenues be earmarked for the Permanent Fund. Currently the state savings account receives a percentage of whatever is left after the grants have been handed out.
It would still allow communities first crack at the money, but if there was insufficient money to deposit the permanent fund’s full share, the amount due would be carried forward to future years.
David Harding, a spokesman for the North Slope Borough mayor’s office, said he is most worried about the change in the grant review process, which he fears could take money away from villages that see the greatest impacts. He says areas where exploration is under way have already seen the effects on their ability to hunt for subsistence foods.
“And those are impacts that are not one time. They are long lasting and substantial and I don’t see how they get anything but more serious,” he said.
The bill passed 12 to 7 on a reconsideration vote Feb. 16 and now moves to the House.
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