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State gas authority wants lobbyist Board plans to spend state money to lobby for more state money Larry Persily Petroleum News Juneau Correspondent
There’s a new sign on the front door of the Alaska Natural Gas Development Authority office in Anchorage. It reads, in simple black and white from an office printer, “Happiness is getting additional funding!”
The authority’s board of directors followed the sign when it voted Dec. 15 to direct the chief executive officer to advertise, interview and bring back a recommendation to hire a lobbyist to push for additional state funding from the Legislature when it returns to work next month in Juneau.
Steve Porter, deputy commissioner at the Department of Revenue and liaison to the gas authority, cautioned board members that he was not sure they could use state funds to hire a lobbyist. The motion, however, passed unanimously.
“If you want to end up with millions of dollars in next year’s budget,” said CEO Harold Heinze, the authority needs a lobbyist. “It’s going to take somebody there full time to represent us.”
Board Chairman Andy Warwick agreed the authority needs a lobbyist to help with pushing for additional funding, adding he would prefer to contract for the work rather than “spending my life down in Juneau lobbying.” Board wants lobbyist to start Jan. 12 The board directed Heinze to quickly advertise, review and interview lobbyist candidates, and to bring a recommendation to the board for action at its Jan. 12 meeting, the opening day of the legislative session. Board members said they want the lobbyist ready to start work that day.
The state-funded authority, created by a voters’ initiative last fall, wants to build, own and operate a $12 billion project to pipe North Slope natural gas to Valdez, where it would be liquefied and shipped to potential LNG receiving terminals in California, Mexico or the Far East.
Heinze said the gas authority’s funding requests will be competing with many other spending needs statewide, and a good lobbyist could increase the odds of success for the authority.
Board member David Cuddy asked if the authority could depend on legislators to work on behalf of full funding for the authority instead of spending money to hire a lobbyist. Heinze answered that although the authority has supporters in the House and Senate, some of those backers for whatever reason haven’t been there “to yell, kick and scream for us,” and the authority needs its own paid lobbyist.
The board did not specify a dollar amount for the lobbyist contract. The authority already has either spent or committed most of its original $150,000 state appropriation for this fiscal year, but obtained $200,000 in additional funding in October from the Legislative Budget and Audit Committee. Additional funding will cover lobbyist Board member John Kelsey asked Heinze if the authority could afford a lobbyist, and Heinze pointed members to his “contracting priorities” list on the meeting agenda for spending the additional $200,000. Hiring a lobbyist is No. 3 on the list, and Heinze said the money would reach that far down the list.
The Legislative Budget and Audit Committee, which can appropriate unanticipated federal funds when the full Legislature is not in session, approved the $200,000 from federal funding Alaska received under the Jobs and Growth Tax Relief Reconciliation Act of 2003. The one-time federal funding was to help the states deal with budget shortages.
The authority, when it requested the $200,000 in October, said it needed the money immediately for a benefits analysis of the pipeline project and other studies. As of Dec. 15, none of the money had been spent or committed, Heinze said. The benefits analysis was No. 1 on the priority list for using the money.
The authority had asked for a second $200,000 from the Legislative Budget and Audit Committee — also for more consultant work — but withdrew the request earlier this month after Heinze said he realized he could not identify a funding source for the extra money as required for such budget requests between sessions. “That turned out to be a dry hole,” Heinze said. Board still plans $2 million request Board members have not turned away from their intent to seek more than $2 million in additional funding for this fiscal year when the Legislature returns to work in January. The authority faces a June 2004 deadline to present the Legislature with a development plan for a state-owned natural gas pipeline project, and board members are getting nervous about getting the job done under such a tight deadline and with limited funding.
And that $2-million-plus would only carry the authority through to June 30, 2004, board members said. That’s when the authority and the Legislature would need to decide whether to proceed with the project’s next phase of ordering steel pipe and compressors, arranging financing, obtaining permits and negotiating contracts to buy and sell the gas. That work could cost $200 million or more, Heinze said.
“We somehow need from June to about 18 months later need to figure out how to get and how to spend a couple hundred million dollars,” Heinze told the board.
And if the authority can’t get the cash it needs from the Legislature in time, he said, “I think we need to see if we can borrow some money or something.”
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