HomeMy WebLinkAboutResolution No. 2005-22CITY OF KENAI
Suggested by: Mayor Porter
RESOLUTION NO. 2005-22
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, SUPPORTING THE
GOVERNOR'S PROPOSED USE OF THE AMERADA HESS SETTLEMENT EARNINGS TO
IMPROVE THE STATE'S AND COMMUNITIES' TRANSPORTATION SYSTEM AND OTHER
CAPITAL IMPROVEMENTS.
WHEREAS, in 1977, shortly after oil started flowing in the Trans Alaska Pipeline, the state filed
suit against the oil companies that were producing North Slope oil, with the claim the
companies were undervaluing the wellhead price of the state's royalty oil, thus depriving
Alaskans of the full value for their resource; and,
WHEREAS, the lawsuit, called Amerada Hess because that was the first oil company listed in
the complaint, was settled 18 years later before going to trial and under the court settlement
and subsequent legislation, the income from the settlement was specifically excluded from the
annual Permanent Fund dividend calculation; and,
WHEREAS, the proposed legislation leverages the Amerada Hess account's interest earnings to
sell $340 million in bonds to finance much-needed capital projects that will help prepare for
Alaska's future; and,
WHEREAS, under the proposal, these would be self-supporting bonds in which the annual debt
service would be paid from the Amerada Hess account's annual earnings; and,
WHEREAS, the Amerada Hess proposal puts the fund to work for Alaskans, funding important
projects in our state that will improve our day-to-day lives and prepare Alaska for its future;
and,
WHEREAS, state funds available to finance capital infrastructure and to address deferred
maintenance needs have been limited for a number of years; and,
WHEREAS, this funding mechanism will allow construction on transportation projects to begin
considerably faster than if they are funded by federal funds, which add three-to-ten years in
time and increase project costs and will allow the state to fund its priorities instead of the
federal government's as required when using federal funds; and,
WHEREAS, the use of the Amerada Hess settlement earnings will put the settlement to work on
behalf of Alaskans and without impacting the Alaska Permanent Fund dividend.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA,
that it supports the leveraging of the Amerada Hess settlement earnings to fund important
transportation projects and other critically needed infrastructure investments.
PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALA~ this fourth day of May, 2005.
PAT PORTER, MAYOR
ATTEST:
Carol L. Freas, City Clerk