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Alaska Energy Authority Vision Navigation 2015-2016
Table of Contents 1.Mission &Vision 2.Statutes &Amendments i.Information Request #2 -Statutes,Regulations and Bylaws ii.Exhibit B iii.Exhibit BR-1 iv.Exhibit BR-2 v.Exhibit D-1 vi.Exhibit D-2 vii.Exhibit L-1 viii.Exhibit R-1 ix.Exhibit R-2 x.Exhibit R-3 xi.Exhibit R-4 xii.Exhibit R-5 xiii.Exhibit R-6 xiv.Exhibit R-7 xv.Exhibit R-8 xvi.Exhibit R-9 xvii.Exhibit S-1 xviii.Exhibit S-2 xix.Exhibit S-3 xx.Exhibit S-4 xxi.Exhibit S-5 xxii.Exhibit S-6 xxiii.Exhibit S-7 xxiv.Exhibit S-8 xxv.Exhibit S-9 xxvi.Exhibit S-10 xxvii.Exhibit S-11 xxviii.Exhibit $-12 xxix.Exhibit $-13 xxx.Exhibit S-14 xxxi.Exhibit $-15 xxxii.Exhibit $-16 xxxiii.Exhibit $-17 xxxiv.Exhibit $-18 xxxv.Exhibit S-19 xxxvi.Exhibit $-20 xxxviil.Exhibit $-21 Please refer to Binder 2 of 3 for Section 3 ,et erro "eneeeeeswrensaeweareer*eee Fe naam ma I cana ath Siena apna b anietniedl . SALAS=ENERGY AUTHORITY 10/01/15-09/30/16 © Vision Navigation®Clear vision,focused strategies,real results, 2 ERApoe tae ht IY eon orbit ye tSidehTE,LOLI FAY In this document Purpose,Mission,Core Values,Vision 2 Key for Use of Vision Navigation®Chart 3 Vision Navigation®Chart 4 List of Projects 5 Project Plans Energy Leadership 6 Community-Based Energy Project Development 8 Information Management 10 Appendix A Strategic Assessment 11 Appendix B Internal Assessment 13\°) Vision Navigation® nes Vision Navigation®2WA0Saree' aod Purpose To develop and deliver optimal energy solutions for Alaska's communities Mission To reduce the cost of energy for Alaskans Core Values From our history to date and from the commitments that we all share now about the future,we have defined the values that should guide all of our activities and staff in the years to come. These are our core values: ¢Respectful:Demonstrating high regard for communities,integrating local perspectives into project development ('15) *Responsible:Being prudent and ethical stewards of Alaskans'resources ('15) *Innovative:Seeking new ideas and methods and adapting to changing conditions ('15) *Passionate:Enthusiasm for and commitment to our work,team and improvement ('15) Our Vision By 2030,there is energy cost parity across Alaska ¢We will champion projects and policies to achieve the renewable and efficiency goals ('15) ¢We will invest in innovative solutions ('15) *We will promote understanding of energy cost impacts upon economic development,sustainability and quality of life ('15) *We will provide the leadership to achieve consensus on energy cost solutions ('15) Target Year-End Condition AEA is acknowledged as the state's community energy leader Version 3.0 Se,-"enVision Navigation®3. Key for Use of Vision Navigation®Chart The Vision Navigation®Chart depicts the steps required to make the vision a reality and to handle priority issues associated with improving the organization's effectiveness. The chart reads from left to right.The left represents present time and the far right the vision of what is to be achieved.Because of the rapid pace of change,detailed planning has been completed only for the current year.Each colored arrow on the chart contains one project.The vertical lines divide the projects into quarters for ease in understanding whether the organization is on schedule in accomplishing its aims. There are two types of projects that may be included on the chart.Improvement projects are intended to work on the efficiency,efficacy,quality,profitability,and/or culture of the organization. Strategic projects are intended to grow the organization and move it toward its vision in the marketplace. Each strategic initiative has been assigned an identifying letter,and the quarterly milestones or tasks are written in ovals.Each improvement project has been assigned an identifying number, and the quarterly milestones are written in rectangles.Following the chart are complete write-ups of each strategic initiative and improvement project to provide supporting documentation to clarify the projects being undertaken.In the Appendix is a section titled "Use of the Vision Navigation® Chart”,which exptains how to use and update this tool on a monthly basis. Below is a key to information contained within each box or circle on the chart: STRATEGIC INITIATIVE IMPROVEMENT PROJECT WMD WMD1.1 u "4 f }\INITIATIVE REFERS TO THE INITIALS OF v REFERS TO THE |NITIALS OFBEINGOUTCOMEOFPERSONPROJECT ADDRESSED tHeINITIATIVE RESPONSIBLE BEING OUTCOMEOF PERSON FOR THE ADDRESSED THEPROJECT RESPONSIBLE OUTCOME OF FOR THE THE INITIATIVE OUTCOME OF Version 3.0 Energy Leadership Team estab- lished to undertake public relations initiative A.SFG Successes of AEA initiatives documented &communicated A3 SM Communk cations plan/oudget developed &adopted A.2 EF MOU's re.respective roles completed AS SFG AEA regional planners appointed to Nnewtly-chartered steering committee AS SFG _ Strategic Initiative A:Energy Leadership Goal:oA Statewicle consensus on theinportancejeenergychallengesahead&support er AEASroposedsolsolutions t-yearTarget:AEA ls acknowledges as the0 state'Sscommunoneenergylead*Requests tornmeting attendance,presentations,interviews 12/31/15 03/31/16 06/30/16 09/30/16 Community-Based Energy Project Development Improvement Project 1:Communit ed Energy Process for implement-Project Development ing community-based 2-year Goal: Project planning &*AEA empowered tto complete the highestFeasibilityanalysisexecutiondesignedvalueprojectsineachcommunity prepared using REF 42.«SS comnren Target:rolectRound9/Regional ity-based piplanning/impementation methodologyplans&AKAES designed &needed statute 14 cL Needed changes defined Metric:statutory changes +Ener 'gaved/generate per dollardefinedinvested&o =r state dollar invested.0 eductions &ener,43 NM cost impacts if practical.ad 12/31/15 03/31/16 06/30/16 09/30/16 Information Management rovement Project 2:Information Scope of needed Design &deploy Test &troubleshoot Document manage-Information Management management team improvements information information ment system "To jyear Ta ag aappointeddefinedmanagementmanagementimplementeddocumentra+oont eyvst&deployfor24KN2.2 KN 2.3 KN 24 KN 2.5 KN work for every department in the agency 12/31/15 03/31/16 06/30/16 09/30/16 oe PreresviemaL cxawne arsvens O17 W.oth Avaruse Suite 206 >Ancronsge,Alssks 99501 ©907.276.4414 Fax 276.4410 ©www professtonalrowihayeternaCom /que ENERGY AUTHORITY Vision Navigation® Chart 10/01/15 -09/30/16 Purpose: To develop &deliver optimal energy solutions for Alaska's communities [Mission:)Reduce the cost of energy in Alaska Our Vision: By 2030,there is energy cost parity across Alaska 2 We will champion projects & policies to achieve the renewable &efficiency goals ('15) -t We will invest in innovative solutions ('15} 4 We will promote understanding of energy cost impacts upon economic development, sustainabitity &quality of life ('15) *We will provide the leadership to achieve consensus on energycostsolutions('15) Target Year-End Condition: AEA is acknowledged as ]the state's community energy teader AA Amy Adler JD Jed Drolet TE Tom Erickson EF Emily Ford Sara Fisher-Goad JH Jennifer Haldane ML Michaal Lamb CL Cady Lister NM Neil McMahon SM Sandra Moller KN Kris Noonan DP Devany Pletovich SS Sean Skaling TW Teri Webster JW Jeff Wifliams @ Vision Navigation® Version 3.0,11/19/15 ,j .,Vision Nawigation® Project Plans Each strategic initiative has been assigned a letter and each improvement project has been assigned a number. The following are the strategic initiatives of Alaska Energy Authority to be undertaken in the coming year: A.Energy Leadership The following are the improvement projects of Alaska Energy Authority to be undertaken in the coming year: 1.Community-Based Energy Project Development 2.Information Management Version 3.0 ao Vision Na gation®6 ye 'isa Strategic Initiative A:Energy Leadership Description:To establish AEA as the lead energy agency. Why: *To be recognized as the State energy leader,create greater understanding of AEA capabilities ¢« Astrategy to partially deal with declining State funding What it Includes: ¢Understanding tools available from other agencies ¢Development of inter-agency agreements *Designing collaborative programs ¢Participation in Arctic Council meetings *Collaborate with other entities to expand remote monitoring *Collaborate on efforts to build capacity in local community utilities ¢Define a vision for AEA *Design and implement a public relations initiative 3-Year Goal: ¢«A statewide consensus on the importance of the energy challenges ahead and support for AEA proposed solutions 1-Year Target: ¢«AEAis acknowledged as the state's community energy leader Metric: Measure name:Requests for Opinion Data plotted:Requests for meeting attendance,presentations,interviews Version 3.0 jfVisionNavigation®7.-.?Prenat etrey Challenges: 1.Other Depts./Administration opposing AEA leadership 2.Lack of resources creates greater competition for leadership 3.Loca!communities wanting to by-pass AEA in approaching Legislature Outcomes:Who:When: 1.Team established to undertake public relations initiative SFG 12/31/15 2.Communications plan/budget developed and adopted EF 12/31/15 3.Successes of AEA initiatives documented and communicated SM 12/31/15 4.Spokespersons identified and empowered JH 03/31/16 5.Relevant MOU's re.respective roles completed SFG 03/31/16 6.AEAregional planners appointed to newly-chartered steering committee SFG 06/30/16 Overall Team Leader:Sara Fisher-Goad Team Members Responsible for Project Metric:Teri Webster Team Members:Sean Skaling,Cady Lister,Katie Conway,Jed Drolet,Neil McMahon Version 3.0 egy wnsson,Navigation®a : Improvement Project 1:Community-Based Energy Project Development Description:Realign existing State programs to support the highest value energy projects that are based on community and regional energy plans.Maximize use of program resources through community-based planning. Why: *Key to maximize use of resources in time of declining resources ¢Show up in communities as uncoordinated without this What it Includes: ¢Defining and implementing a process for community-based project plans across AEA programs 2-Year Goal: «AEA empowered to complete the highest value projects in each community 1-Year Target: *«Community-based project planning/implementation methodology designed and needed statute changes defined Metric: Measure name:Project Return on Investment Data plotted:Energy saved/generated per dollar invested &per state dollar invested. Also GHG reductions &energy cost impacts if practical. Type of chart:Run chart Challenges: 1.Resistance to statute change 2.Internal resistance to change 3.Political opposition Version 3.0 , Visi tion®9 ./ ision Nawiga fon eee Outcomes:Who:When: 1.Feasibility analysis prepared using REF Round 9/regional plans and AKAES CL 03/31/16 2.Process for implementing community-based project planning and execution designed Ss 09/30/16 3.Needed statutory changes defined NM 09/30/16 Overall Team Leader:Sean Skaling Team Members Responsible for Project Metric:Cady Lister Team Members:Jed Drolet,Emily Ford,Amy Adler Version 3.0 "se.Vision Navigation®°/ Improvement Project 2:Information Management Description:Look for use of technology for document management and other means to improve common understanding/coordination. Why: «Risk re-inventing the wheel due to lack of knowledge across sections of agency of their ongoing initiatives ¢-Inability to readily update leadership and others on status of projects *Inability to easily access needed information What it Includes: «Examining potential use of project management software application *€xamine best practices re.use of technology ¢Standardization of information 1-Year Target: ¢To research,design,test,and deploy a document management system that will work for every department in the agency Challenges: 1.Lack of funding 2.Staff adopting new methods Outcomes:Who:When: 1.Information management team appointed KN 12/31/15 2.Scope of needed improvements defined KN 12/31/15 3.Design &deploy information management KN 03/31/16 4.Test and troubleshoot information management KN 06/30/16 5.Document management system implemented KN 09/30/16 Overall Team Leader:Kris Noonan Team Members:Sandra Moller,Amy Adler,Sean Skaling,Cady Lister,Jennifer Haldane, Terence Cato and Rich Wooten Version 3.0 Appendix A: Strategic Assessment \°) Vision Navigation® noe.Vision Nawigation®11 Strategic Initiative Project Definitions Strategic Initiative 1:Establish AEA as State Energy Leader Description:To establish AEA as the State's community energy leader. Why: *To be recognized as the State energy leader,create greater understanding of AEA capabilities *Astrategy to partially deal with declining State funding What it Includes: «Understanding tools available from other agencies ¢Development of inter-agency agreements ¢Designing collaborative programs ¢«Participation in Arctic Council meetings Collaborate with other entities to expand remote monitoring °Collaborate on efforts to build capacity in local community utilities Define a vision for AEA ¢Design and implement a public relations initiative Version 3.0 are Navigation®12. Strategic Initiative 2:Proactive Approach to Reduced State Funding Description:Seeking out other funds and solutions and tightening the priorities of our programs. Why: ¢Declining State funding is inevitable What it Includes: ¢Increased collaboration with other Federal agencies ¢Applying for Federal grants ¢Furthering collaboration with AVEC and local banks *Developing strategy for use of the PCE endowment ¢Working with Legislature to have more flexible funding streams for AEA «Leveraging the Renewable Energy Fund to attract Federal funding Version 3.0 ww ."A en - tal7 " oOONNpaterwrpgevertueepeeeee Appendix B: Internal Assessment 2) Vision Navigation® Vision Navigation®13 Potential Improvement Project Definitions Improvement Project 1:Lack of staff focus on a mission/vision Description:Defining a long-term vision and instilling this within our workforce. Why: *Staff lack understanding of the big picture at AEA *Need to maintain our high quality staff *Because there are so many options for energy policy and how to effect that What it Includes: *Define a vision statement ¢Define a process for communicating and getting feedback/buy-in to the vision ¢Aligning our programs with new vision statement ¢Taking shared services staff to the field to understand impact of out efforts upon community Improvement Project 2:Improved Information Management Description:Look for use of technology for project tracking and other means to improve common understanding/coordination. Why: *Risk re-inventing the wheel due to lack of knowledge across sections of agency of their ongoing initiatives *Inability to readily update leadership and others on status of projects ¢Inability to easily access needed information What it Includes: ¢Examining potential use of project management software application ¢Examine best practices re.use of technology ¢Standardization of information Version 3.0 "s ' ,Vision Navigation®14 Improvement Project 3:Maximize Use of Program Resources thru Community-Based Planning Description:Development of community-based plans across multiple AEA programs. Why: *Key to maximize use of resources in time of declining resources ¢Show up in communities as uncoordinated without this What it Includes: ¢Defining and implementing a process for community-based project plans across AEA programs Version 3.0 AQ A ae oe eae we,.9 reda alrwe:ei ne-aren-_-Rh att artetn tant ee A PRODUCT OF PROFESSIONAL GROWTH SYSTEMS 911 West 8th Avenue,Suite 205 Anchorage,Alaska 99501 Office 907.276.4414 Fax 907.276.4419 Toil Free 877.276.4414 www.professionalgrowthsystems.com INFORMATION REQUEST #2 Alaska Energy Authority Statutes,Regulations and Bylaws |.AEA--Primary Statutes: a.AS 44.83.020 -AS 44.83.995 (Exhibit S-1). b.AS 42.45.010 -AS 42.45.990 (Exhibit S-2). The connections between AEA's primary statutes and AEA's organizational structure and programs are identified more specifically below. ll.AEA Organization and Administration: 1.Creation,purposes,organizational issues. a.Statutes:AS 44.83.020 -AS 44.83.070 (Exhibit S-1) i.AS 44.83.020 -Creates AEA. ii.AS 44.83.030 -Designates the members of the Alaska Industrial Development and Export Authority (AIDEA)as the board of directors of AEA. iii.AS 44.83.040 -Establishes rules for organizing board meetings,including quorum,notice,conflict of interest,and other matters related to board meetings. iv.AS 44.83.070 -Articulates the purposes of AEA:"The purpose of the authority is to promote,develop,and advance the general prosperity and economic welfare of the people of the state by providing a means of financing and operating power projects and facilities that recover and use waste energy and by carrying out the powers and duties assigned to it under AS 42.45.” b.Regulations:3 AAC 105.020 (Exhibit R-1).Regulation allows AEA to apply for,obtain, and accept conditions related to state or federal funding for the construction, financing,operation,and maintenance of power projects and for bulk fuel,waste energy,energy conservation,energy efficiency,and alternative energy facilities, equipment,or programs that are consistent with applicable provisions of AEA's statutes,regulations and programs. c.Bylaws.(Exhibit B). i.Article |-General information about AEA. ii.Article Il-Board of Directors and Officers,including duties of the Executive Director. iii.Article Ill Board Meetings. iv.Article lV -Records. v.Article V-Amending Bylaws. d.Board Resolutions: i.AEA No.2011-01 (BR-1).The resolution appoints the Executive Director and delegates duties,including the authority for the Executive Director to sign contracts and to sub-delegate duties to other AEA officers. ii,AEA 2012-06 (BR-2).AEA has no employees.The resolution authorizes the AEA Executive Director to obtain from AIDEA,and contract to compensate AIDEA for,personnel services,overhead expenses,administrative support, and other related support. iii.AEA 2012-06 (BR-2).The resolution authorizes AEA to borrow from AIDEA up to $7,500,000 for working capital needs arising from AEA projects. 2.General Powers. a.Statutes:AS 44.83.080 (Exhibit $-1).Statute identifies AEA's broad powers. 3.AEA Administrative Provisions. a.Statutes:(each -Exhibit S-1) i.AS 44.83.900.Statute requires annual audit. ii.AS 44.83.940.Statute requires an annual comprehensive report of AEA's operations,income and expenses. iii.AS 44.83.950.Statute clarifies the executive budget act applies to AEA and requires AEA annually prepare a report for the legislature on the status of AEA projects. b.Regulations:2 AAC 45.010 (Exhibit R-6).An exemption from the normal single audit requirement is provided for AEA managed grants. 4.Procurement: AEA procurement is primarily done under the Alaska Procurement Code,which is generally applicable to all state agencies.The Alaska Procurement Code,however,does not apply to certain types of transactions,including grants and grant projects.Under various programs, AEA manages the construction of projects as the agent of the grantee community ("AEA managed grants”).Under its general powers,AEA has adopted procurement regulations for AEA managed grants that are not subject to the Alaska Procurement Code. Alaska Energy Authority Statutes,Page 2 Regulations and Bylaws e Procurement for AEA managed grants,not subject to the Alaska Procurement Code. a.Statutes: i.AS 44.83.080 (Exhibit S-1}.AEA's general powers. ii.AS 44.83.920 (Exhibit S-1).Statute prohibits AEA from requiring any bidder on a construction contract to obtain required insurance from a particular broker or agent. b.Regulations:3 AAC 109.100 -3 AAC 109.900 (Exhibit R-2).AEA's procurement regulations. c.Board Resolutions:AEA No.2009-04 (BR-3).AEA Board authorizes the Executive Director to make final decisions on claims and protests arising from procurements, contracts and construction projects that are not subject to the Alaska Procurement Code.Claims and protests arising from matters subject to the Alaska Procurement Code are addressed under the Code. e Procurement under the Alaska Procurement Code. a.Statutes:AS 36.30.005 -36.30.995 (Exhibit S-3).The Alaska procurement code. b.Regulations:2 AAC 12.010 -2 AAC 12-990 (Exhibit R-7).Regulations associated with the Alaska procurement code. c.Delegations (Exhibits D-1 and D-2).The Department of Administration and the Department of Transportation and Public Facilities delegate procurement authority to AEA.The delegations enable AEA to procure under the Alaska procurement code. ¢Procurement restriction on construction contracts for both AEA managed grants and public construction. a.Statutes:AS 44.83.920 (Exhibit S-1).Statute prohibits AEA from requiring any bidder on a construction contract to obtain required insurance from a particular broker or agent. 5.Public Records Act. a.Statutes: i.AS 44.83.970 (Exhibit S-1).Statute clarifies that the public records act applies to AEA). ii.AS 40.25.100 -40.25.295 (Exhibit S-4).The Alaska public records act. b.Regulations:2 AAC 96.100 -2 AAC 96.900 (Exhibit R-8).Regulations associated with the Alaska public records act. Alaska Energy Authority Statutes,Page 3 Regulations and Bylaws 6.Open Meetings Act. a.Statutes: i.AS 44.83.970 (Exhibit S-1).Statute clarifies that the open meetings act applies to AEA. ii.AS 44.62.310 -44.62.312 (Exhibit S-5).The open meetings act. iii.AS 42.05.431 (Exhibit S-6).Statute makes the open meetings act applicable to Bradley Project Management Committee meetings for as long as Bradley Lake project agreements are exempt from RCA regulation.The Bradley Lake project agreements will become subject to RCA regulation when Bradley project bonds are no longer outstanding. 7.Executive Budget Act: a.Statutes: i.AS 44.83.950 (Exhibit S-1).Statute clarifies that the executive budget act applies to AEA. ii.AS 37.07.010 -37.07.130 (Exhibit S-7).The executive budget act. 8.Administrative Procedures Act: a.Statutes: i.AS 44.62.010 -44.62.305 (Exhibit S-9).The administrative procedures act.In contrast to AIDEA under AS 44.88.085,AEA is subject to the administrative procedures act in adopting regulations. ii.AS 44.62.320 (Exhibit S-9).Statute provides for legislative review of rules. 9.Public Construction. a.Statutes: i.AS 36.05.005 -36.30.995 (Exhibit S-10).Statutes require prevailing wages for public construction projects. ii.AS 36.25.010 -36.25.020 (Exhibit S-11).Statutes require contractor's bonds. iii.AS 36.10.005 -36.20.990 (Exhibit $-12).Statutes establish employment preferences for certain construction projects and public works. iv.AS 36.90.300 (Exhibit $-13).Statute requires the inclusion of indemnification,defense and hold harmless provisions in construction related professional services contracts. 10.Executive Branch Ethics Act. a.Statutes:AS 39.52.010 -39.52.965 (Exhibit S-14).The executive branch ethics act applies to directors of the AEA board.The act also applies to AEA staff,but only because each staff person is an employee of AIDEA. Alaska Energy Authority Statutes,Page 4 Regulations and Bylaws 11.Office of Administrative Hearings. a.Statutes:AS 44.64.010 -44.64.200 (Exhibit S-15).The Office of Administrative Hearings is available to adjudicate contract,procurement and other disputes. 12.Miscellaneous State Statutes. i.AS 40.21.010 -40.21.140 (Exhibit S-16).Statute requires the preservation of certain records. ii.AS 37.25.050 (Exhibit S-17).Statute establishes rules for the disbursement of funds. iii,AS 24.08.035 (Exhibit S-18).Statute requires fiscal notes. iv.AS 44.99.030 (Exhibit S-19).Statute prohibits AEA from entering any contract for lobbying. v.AS 44.99.040 (Exhibit S-19).Statute prohibits AEA from using its assets to support federal actions that infringe on rights of persons related to the Second Amendment or constitutional due process,or that support the Real ID Act of 2005. vi.AS 44.12.200 (Exhibit S-20).Statute sets rules for state office hours. lit.AEA Programs: A.Loan Programs 1.Power Project Fund. a.Statutes: i.AS 42.45.010 (Exhibit S-2).Statute creates the fund and establishes the power project fund program and criteria for AEA to make loans. ii.AS 44.88.080(30)(Exhibit S-21).Statute enables AIDEA,with legislative approval,to purchase PPF loans as a means to recapitalize the power project fund. b.Regulations:3 AAC 106.100 -3 AAC 106.159 (Exhibit R-3).AEA's power project fund program regulations. 2.Rural Electrification Revolving Loan Fund. a.Statutes:AS 42.45.020 (Exhibit S-2).Statute creates the fund and establishes the rural electrification revolving loan fund program and criteria for AEA to make loans. The program has been dormant as to AEA making new loans due to the fund not being capitalized.AEA continues to collect amounts owed on existing loans. b.Regulations:3 AAC 106.200 -3 AAC 106.269 (Exhibit R-3). Alaska Energy Authority Statutes,Page 5 Regulations and Bylaws B.Grant Programs 1.Power Cost Equalization Program. a.Statutes: i.AS 42.45.070 -42.45.099 (Exhibit S-2).Statutes create the power cost equalization endowment fund,and establish criteria for the investment and administration of the PCE endowment fund.Seven percent of three year average market value of the endowment fund is made available for appropriation to pay administrative costs of the fund and to deposit into the power cost equalization and rural electric capitalization fund. ii.AS 42.45.100 -42.45.190 (Exhibit S-2).Statutes create the power cost equalization and rural electric capitalization fund,and establish criteria for the administration of the fund and the PCE program,and criteria for utilities to receive PCE payments. b.Potential Statutory Amendments:CCS SB 196 (Exhibit L-1).CCS SB 196 is a legislative bill that would amend statutes related to the PCE endowment fund.As of May 4, 2016,the bill had passed both houses of the legislature.If signed by the Governor to enact the bill into law,the amount available for appropriation from the endowment fund would be reduced from seven percent to five percent.Further,if earnings of the fund in a year exceed amounts necessary to fund the PCE program and administrative expenses,the amendment would establish criteria under which the legislature could appropriate seventy percent (70%)of the excess amount to fund certain programs.The first $30,000,000 would be available to fund community revenue sharing or community assistance.The next $25,000,000 would be available to fund certain energy programs:(i)the renewable energy grant fund (AS 42.45.045 -see Section II.B.3 below),(ii)the bulk fuel revolving loan fund (AS 42.45.250),and AEA's rural power system upgrade program (see Section IlI.C.1 below). c.Regulations: i.3 AAC 107.200 -3 AAC 107.270 (Exhibit R-4).AEA's PCE regulations. ii.3 AAC 52.640,and 3 AAC 52.670 -3 AAC $2.690 (Exhibit R-9).Regulations of the Regulatory Commission of Alaska (RCA).These regulations coordinate the administration of the PCE program between RCA and AEA. 2.Utility Improvements Grant Program. a.Statutes:AS 42.45.180 (Exhibit S-2).Statute empowers AEA to make grants from the power cost equalization and rural electric capitalization fund to eligible utilities for small power projects,and establishes criteria associated with the grants.The program has been dormant as amounts available for expenditure from the power Alaska Energy Authority Statutes,Page 6 Regulations and Bylaws cost equalization and rural electric capitalization fund have been devoted to PCE payments to utilities. b.Regulations:3 AAC 107.300 -3 AAC 107.430 (Exhibit R-4).AEA's regulations that establish rules for administering and making grants under AS 42.45.180. 3.Renewable Energy Grant and Recommendation Program. a.Statutes:AS 42.45.045 (Exhibit S-2).Statute creates the renewable energy grant and recommendation fund and establishes the REF program,the REF advisory committee,and criteria for AEA and the REF advisory committee to recommend REF grant projects to the legislature. b.Regulations:3 AAC 107.600 -3 AAC 107.695 (Exhibit R-4).Regulations establish rules for the REF program,and criteria for AEA and the REF advisory committee to review grant applications,rank proposed REF projects,and recommend REF projects to the legislature for it to approve grants. 4.Emerging Energy Technology Grant Program. a.Statutes:AS 42.45.375 (Exhibit S-2).Statute creates the emerging energy technology grant fund and establishes the EETF program,the EETF advisory committee,and criteria for AEA to make EETF grants in consultation with the the EETF advisory committee. b.Regulations:3 AAC 107.700 -3 AAC 107.799 (Exhibit R-4).Regulations establish rules for the REF program,and criteria for AEA in consultation with the EETF advisory committee to review grant applications,rank proposed EETF projects,and make EETF grants. 5.Southeast Energy Fund. a.Statutes:AS 42.45.040 (Exhibit S-2).Statute creates the southeast energy fund and criteria for AEA to make grants for projects.The fund and program have been dormant due to the fund not being capitalized after the repeal of the Four Dam Pool transfer fund (AS 42.45.050)in 2000.The repeal was done in conjunction with the sale of the Four Dam Pool hydroelectric projects. C.Financial and Technical Assistance for Energy Systems,Facilities,and Equipment AEA's broad general powers (primarily under AS 44.83.080)enable AEA to establish various energy programs.AEA's broad powers include those related to AEA carrying out its corporate purposes and powers,and those related to constructing,improving,equipping,operating,and maintaining power projects,bulk fuel,waste energy,energy conservation,energy efficiency,and alternative energy facilities or equipment,and promoting energy conservation,energy efficiency,and alternative energy,and powers related to power projects,sales,and transmission. Alaska Energy Authority Statutes,Page 7 Regulations and Bylaws 1.Bulk Fuel Storage Facility and Power System Upgrades. a.Statutes:AS 44.83.080 (Exhibit S-1).AEA's broad general powers (see comment above under heading for Section IlI.C.). b.Regulations:3 AAC 108.100 -3 AAC 108.130 (Exhibit R-S).Regulations establish the bulk fuel storage facility (BFU)and rural power system upgrade (RPSU)programs, program eligibility,and criteria for AEA to provide services,including prioritizing services due to funding limitations. 2.Circuit Rider Maintenance and Electrical Emergencies Programs. a.Statutes: i.AS 42.45.900-42.45.910 (Exhibit S-2).Statutes mandate that AEA provide technical assistance programs for catastrophe prevention and training regarding utility projects,and technical assistance and training that the utilities need to improve the efficiency,safety,and reliability of their power systems and to prevent emergency situations from developing. ii.AS 44.83.080 (Exhibit S-1).AEA's broad general powers (see comment above under heading for Section III.C.). b.Regulations:3 AAC 108.200 -3 AAC 108.240 (Exhibit R-5).Regulations establish the circuit rider maintenance and electrical emergencies programs,program eligibility, and criteria for AEA to provide services,including prioritizing services due to funding limitations. 3.Alternative Energy and Energy Efficiency Programs. a.Statutes:AS 44.83.080 (Exhibit S-1).AEA's broad general powers (see comment above under heading for Section III.C.). b.Regulations:3 AAC 108.300 -3 AAC 108.320 (Exhibit R-5).Regulations establish the alternative energy and energy efficiency programs,program eligibility,and criteria for AEA to provide services,including prioritizing services due to funding limitations. 4.Village Energy Efficiency Program. a.Statutes:AS 44.83.080 (Exhibit S-1).AEA's broad general powers (see comment above under heading for Section III.C.}. b.Regulations:3 AAC 108.400 -3 AAC 108.499 (Exhibit R-5).Regulations establish the village energy efficiency program,program eligibility,grant application process, criteria for AEA to review and make grants,and criteria for the implementation of grants and grant conditions. 5.Commercial Building Energy Audit Program. a.Statutes:AS 44.83.080 (Exhibit S-1).AEA's broad general powers (see comment above under heading for Section II!.C.). b.Regulations:3 AAC 108.500 -3 AAC 108.590 (Exhibit R-S).Regulations establish the commercial building energy audit program,program eligibility,grant application Alaska Energy Authority Statutes,Page 8 Regulations and Bylaws process,criteria for AEA to review and make grants,and criteria for the implementation of grants and grant conditions. IV.AEA Owned and Operated Power Projects: 1.Operation of Power Projects. a.Statutes:(each under Exhibit S-1) i.AS 44.83.080.AEA's broad general powers (see comment above under heading for Section Iltl.C.). ii.AS 44.83.396.Statute establishes criteria for AEA to own and administer power projects obtained under the former energy program for Alaska and the Susitna River hydroelectric project.The statute establishes criteria for AEA to operate the projects,or contract with a utility to operate the project,and review project Operations and budgets to ensure efficiencies. b.Uncodified Law:Sec.37,ch.18,SLA 1993 provides: CONTRACTS WITH PRIVATE SECTOR,The Alaska Energy Authority shall,to the maximum extent feasible,enter into contracts with public utilities and other entities to carry out its duties with respect to the maintenance and operation of power projects owned by the Alaska Energy Authority. c.Regulations:3 AAC 105.300 -3 AAC 105.310 (Exhibit R-1).Regulations establish criteria by which AEA may contract for the operation of an AEA owned power project,and provide for annually setting power rates applicable to the power project. 2.Power sales,contracting,and Exemption from RCA regulation a.Statutes:(each under Exhibit S-1) i.AS 44.83.080.AEA's broad general powers (see comment above under heading for Section IlI.C.). ii.AS 44.83.090 -44.83.092.Statutes establish criteria under which AEA may enter contracts for the sale of power from AEA owned power projects,including criteria to establish the cost of power sold,and provides that AEA (but not purchasing utilities)is not subject to regulation by the Regulatory Commission of Alaska. iii.AS 44.83.930.For AEA owned power projects,the statute requires AEA to enter into one or more power sales agreements that meet the criteria established by AS 44.83.090,unless the power sales agreement was entered under former AS 44.83.380 -44.83.425. 3.Susitna-Watana Hydroelectric Project: a.Statutes:(each under Exhibit S-1) i.Statutes listed in Sections IV.1.a.and IV.2.a above. Alaska Energy Authority Statutes,Page 9 Regulations and Bylaws AS 44.83.080(18).Statute gives AEA power to acquire a Susitna River power project,by construction,purchase,gift or lease.The statute also gives AEA power to acquire property rights and interests for the project using eminent domain powers under AS 09. AS 44.83.085.Statute requires AEA to annually report to the legislature on the status of the Sustina River power project. 4.Bradley Lake Hydroelectric Project: a.Statutes: Statutes listed in Sections IV.1.a.and IV.2.a above. AS 42.05.431 (Exhibit S-6).The statute makes Bradley Lake agreements for the purchase and transmission of Bradley Lake power exempt from regulation by the Regulatory Commission of Alaska for the life of the Bradley bonds.The exemption applies to Railbelt utilities that purchase Bradley Lake power from AEA.AEA is not subject to RCA regulation under AS 44.83.090. 5.Power Development Fund: a.Statutes: V.AEA Bonds: AS 44.83.382 -44.83.388 (Exhibit S-1);Statutes create the power development fund and establish criteria for AEA to use and allocate amounts to projects,and invest moneys in the fund. AS 37.10.070,37.10.071 and 37.01.075 (Exhibit S-8).These statutes are referenced in AS 44.83.386 to establish criteria for investing amounts in the power development fund. a.Statutes:AS 44.83.100-44.83.160;and AS 44.83.910 (Exhibit S-1). AS 44.83.100.Statute authorizes AEA to incur debt or issue bonds, including bonds payable from project revenues.Statute also establishes criteria for bonds. AS 44.83.110.Statute establishes criteria for,and covenants included in, trust indenture and trust agreements associated with AEA issuing bonds. The statute also enables AEA to issue bonds with "capital reserve funds” by which AEA's bonds would include the State of Alaska's moral obligation,and establishes criteria and processes related to the use of capital reserve funds. AS 44.83.120.Statute provides the legislature's intent that a pledge made respecting AEA issued bonds is considered perfected,valid,and is binding without further act.The statute also provides that no resolution,trust agreement or other instrument with a pledge need be filed under the Alaska Energy Authority Statutes,Page 10 Regulations and Bylaws vi. vii. viii. Uniform Commercial Code to be valid,binding and effective against the parties. AS 44.83.130.Statute provides that neither the board members nor a person executing an AEA bond is personally liable on the bonds.The statute also provides AEA bonds are not an indebtedness or liability of the State,and AEA may not pledge the full faith and credit of the State. AS 44.83.140.Statute pledges that the state will not limit or alter the rights and powers of AEA to fulfill contract obligations or impair rights of bond holders while bonds remain outstanding. AS 44.83.150.Statute declares that all AEA property is devoted to an essential public and governmental function and purpose,and tax exempt. The Statute also declares that AEA bonds are issued by a governmental body for essential public purposes and interest and income is exempt from taxation except transfer,inheritance,and estate taxes. AS 44.83.160.Statute establishes that AEA bonds are legal investments in which public and private entities may invest,and are securities that may be deposited by or with public officers,state bodies,and municipalities. AS 44.83.910.Statute provides that at least 60 days before issuing bonds, AEA must give notice of AEA's intent to issue bonds to the governor and to the legislature,if the legislature is in session,or to the Legislative Budget and Audit Committee,if the legislature is not in session. Alaska Energy Authority Statutes,Page 11 Regulations and Bylaws Exhibit B BYLAWS OF THE ALASKA ENERGY AUTHORITY ARTICLE |-THE AUTHORITY Section1.Name of Authority.The name of the Authority shall be "Alaska Energy Authority.” Section 2.Seal.The seal of the Authority shall be circular in form and shall bear the name of the Authority and the year of its creation. ity.The principal office of the Authority shall be located in the Municipality of Anchorage,Alaska.The Authority may have such other offices as the Board may designate or as the business of the Authority may require from time to time. Section4,Fiscal Year.The fiscal year of the Authority shall be the same as the fiscal year of the State of Alaska. ARTICLE Il -BOARD OF DIRECTORS AND OFFICERS Section 1.Board of Directors.AS 44.83.030 establishes that the Directors of the Authority are the members of the Aiaska Industrial Development and Export Authority (AIDEA).The vice-chair of AIDEA shall serve as chair of the board of directors of the Authority.The chair of AIDEA shall serve as the vice chair of the board of directors of the Authority. Section 2,Oath and Disclosure.Each Director before entering upon his/her duties shall take and subscribe to an oath to perform the duties of his/her office faithfully,impartially and justly to the best of his/her ability.A record of the oath shall be filed in the Office of the Governor.Each Director is required to file a disclosure statement with the Alaska Public Offices Commission. Section3,Chair.The Chair of the Board shall preside at all meetings of the Board.Except as otherwise authorized by resolution of the Board,the Chair and the Executive Director shall submit such recommendations and information to the Board as they may consider proper concerning the business, affairs,and policies of the Authority. Section4,Vice Chair.The Vice Chair of the Board shall perform the duties of the Chair in the absence or incapacity of the Chair. --.(a)The Board shall appoint an Executive Director.The Executive Director shall be the Secretary-Treasurer of the Authority.The Executive Director shall,subject to review by the Directors of the Authority,in general supervise and contro!the business and affairs of the Authority,and shall perform all duties incident of the office of Executive Director and such other duties as the Directors of the Authority may prescribe from time to time. (b)As Secretary,the Executive Director shall: 1.Keep the records of the Authority; 2.Keep a record of the proceedings of the Authority in a journal of proceedings to be kept for such purposes; 3.Act as Secretary of the meetings of the Authority and record all votes; 4.Provide that all meetings of the Authority are electronically recorded; AEABy-Laws sss-s-sSSSSage1Of4Revised7/25/2013 5.Provide for the standardization of all applications,forms,books and records of the Authority; 6.Keep in safe custody the seal of the Authority and affix the seal to appropriate contracts and instruments authorized to be executed by the Authority;and 7.Perform all other duties incident to his or her office. (c)As Treasurer,the Executive Director is authorized to: 1.Have the care and custody of all funds of the Authority; 2.Deposit Authority funds in such banks as he or she may select; 3.Invest corporate funds as directed by statute; 4.Disburse monies for all Authority expenses and obligations;and 5.Have annual audits made of the books of account of the Authority. (d)As Treasurer,the Executive Director is directed to: 1.Keep regular books of accounts of all financial transactions of the Authority,recording receipts and expenditures. 2 Render such reports and accounting as required by the Board. (e)The Board,by a majority vote at a regularly called or specially called Board meeting,may by resolution assign to some other person all or part of the above enumerated duties of the Executive Director and Secretary-Treasurer of the Authority,or authorize the Executive Director to delegate all or part of the above enumerated duties to some other person or persons,and may give said person or persons,an appropriate title including that of Deputy Director,Assistant Secretary,or Assistant Secretary- Treasurer. Section6.Contracts.Repealed 2/8/01 Resolution 2001-02. Section7,Loans.Repealed 2/8/01 Resolution 2001-02. Section8.Checks.Repealed 2/8/01 Resolution 2001-02. Section9,Deposits.Repealed 2/8/01 Resolution 2001-02. Section10,Additional Duties.The officers of the Authority shall perform such other duties and functions as may from time to time be required by the Board or the Bylaws or policies and procedures of the Authority. Section 11,Election or Appointment.Repealed 8/12/93 Resolution 1993-06. Section12,Vacancies.When the office of the Secretary-Treasurer of the Authority and Executive Director of the Authority becomes vacant the Board shall appoint a successor as provided in Section 5 of this Article. Section 13.Additional Personnel.Repealed 2/8/01 Resolution 2001-02. Section 14,Selection of Management Personnel.Repealed 8/12/93 Resolution 1993-06. If any Director on the board,employee,consultant,advisor,counsel or other agent of the Authority or the Alaska Industrial Development and Export Authority shall be a party to a lease or contract under consideration by the Authority,or shall have a direct ownership or equity or debt interest or other financial interest in a firm,partnership,corporation or association which is a proposed party to a lease or contract under consideration by the Authority,he or she shall so state in writing to the Authority at the AEA By-Laws Page 2 of 4 Revised 7/25/2013 time of initial consideration of the proposed lease or contract and shall thereafter take no part in the Authority's consideration of the lease or contract. Section 16,Legal Indemnification.Repealed 2/29/2012 Resolution 2012-01 ARTICLE Ill -BOARD MEETINGS Section 1,Annual Board Meeting.Repealed 2/28/95 Resolution 1995-01. j .The Board shall hold regular meetings at such times and places as may be established by resolution of the Board,but in the absence of such designation then at a place and on a date as fixed by the Chair.The Directors on the Board shall have at least five days prior notice of regular meetings;designation of date,time,and place of meeting at the previous regular meeting constitutes sufficient notice to Directors on the Board.If the Directors not present have signed a Waiver of Notice and Consent,then any and all business may be transacted even though notice of the meeting is not provided to Directors on the Board. i .Not less than five days before each regular meeting,the Authority will give public notice of the time,place,and subject of the meeting. Section 4.Special Board Meetings,Special meetings may be called upon request of the Chairman or upon the request of any two Directors on the Board for the purpose of transacting any business designated in the call.The call for a special meeting may be transmitted electronically or mailed to the business or home address of the Directors on the Board at least 48 hours prior to the date of such special meeting.Reasonable notice shall be provided to the public for any special meeting.At such special meeting no business shall be considered other than as designated in the call,but if the Directors not present have signed a Waiver of Notice and Consent to Meeting,a quorum otherwise being present, any and all business may be transacted at such special meeting. Section5,Board Information.For each Board of Directors'meeting,the Executive Director and staff shall prepare a packet of information including an agenda,action items,informational items, resolutions,and other information pertinent to the meeting. Section 6,Executive Sessions.Executive sessions may be held in accordance with the procedures and with respect to the expected subjects as set forth in,and in accordance with,AS 44 62.310. Section7,Quorum.The powers of the authority are vested in the Directors,and four Directors of the Authority constitute a quorum.Action may be taken and motions and resolutions adopted by the Authority at any meeting by the affirmative vote of a majority of the Directors.A vacancy on the Board of the Authority does not impair the right of a quorum to exercise all the powers and perform all the duties of the Authority. Section8,Order of Business.Repealed 2/8/01 Resolution 2001-02. Section9,Voting.Each Director on the Board shall have the right to cast one vote on any question voted upon during any meeting.Only those Directors present,or those persons duly appointed to attend in their absence,may vote. The voting on all questions coming before the Board shall be by roll call,and the "yeas"and "nays"shall be entered upon the minutes of such meeting providing any dissenting votes are cast.Otherwise resolutions may be shown as unanimous. ARTICLE IV -RECORDS AEA By-Laws Page 3 of 4 Revised 7/25/2013 Section1,Custody.The books and records of the Authority,including all applications for financing and all contracts with third parties,including consultants,financial advisors and bond counsel, shall be maintained in the offices of the Authority. Section2,Public Inspection.All books and records of the Authority,unless privileged,are available for public inspection during regular office hours at the offices of the Authority.The Authority will provide copies of books and records on request,but may charge a reasonable fee for this service which fee may include the cost of employee time and overhead.Books and records need not be reproduced in the exact form or medium in which they are stored,however,any alteration in the form or medium shall not change the substantive content of the information contained in the books or records. ARTICLE V -AMENDMENTS .The Bylaws of the Authority shall be amended only with the approval of at least three of the Directors of the Board at a regular or special Board meeting,but no such amendment shall be adopted at a special Board meeting unless all Board Directors are present or have been given at least 48 hours written or electronic notice thereof,as required by Article III,and a copy of the amendment(s)has been previously given to all of the Directors of the Board of the Authority. AMENDMENTS Alaska Power Authority Bylaws,original 1978. Resolution 1981-6 of the Alaska Power Authority Board of Directors. Resolution 1993-06 of the Alaska Energy Authority. Resolution 1995-01 of the Alaska Energy Authority. Resolution 2001-02 of the Alaska Energy Authority Resolution 2008-02 of the Alaska Energy Authority Resolution 2012-01 of the Alaska Energy Authority Resolution 2013-04 of the Alaska Energy AuthorityONAARWN>ee eee AEA By-Laws Page 4 of 4 Revised 7/25/2013 Exhibit BR-1 ALASKA ENERGY AUTHORITY RESOLUTION NO.2011-01 RESOLUTION OF THE ALASKA ENERGY AUTHORITY RELATING TO THE APPOINTMENT BY THE AUTHORITY OF AN EXECUTIVE DIRECTOR WHEREAS,the By-Laws of the Alaska Energy Authority (the "Authority”)allow the Board of Directors of the Authority to appoint an Executive Director of the Authority; WHEREAS,the By-Laws of the Authority further provide that the Executive Director of the Authority is the Secretary-Treasurer of the Authority; WHEREAS,it is in the public interest and in the best interests of the Authority that Sara Fisher-Goad be appointed Executive Director of the Authority; WHEREAS,it is in the best interest of the Authority that Michael Harper be re-appointed to continue his duties as Deputy Director-Rural Energy and Assistant Secretary of the Authority; WHEREAS,the By-Laws of the Alaska Industrial Development and Export Authority ("AIDEA”)provide for the hiring of the Executive Director of the Authority,as follows: The members of [AIDEA]may from time to time,employ an Executive Director for the Alaska Energy Authority,as the Board of Directors of the Alaska Energy Authority deems necessary to exercise their powers,duties and functions prescribed by AS 42.45,AS 44.83,and all other applicable laws of the State of Alaska.[AIDEA]and the Alaska Energy Authority shall enter into a contract providing for reimbursement of costs associated with employment of the Executive Director.The selection and compensation of the Executive Director of the Alaska Energy Authority shall be determined by the Board of Directors of the Alaska Energy Authority. WHEREAS,the Board of Directors of the Authority has selected Sara Fisher-Goad to be Executive Director of the Authority,and has determined that the employment of Sara Fisher- Goad as Executive Director of the Authority is necessary to exercise the Authority's powers, duties and functions prescribed by AS 42.45,AS 44.83,and all other applicable laws of the State of Alaska;and WHEREAS,the Board of Directors of the Authority has negotiated and determined the compensation of Sara Fisher-Goad as Executive Director of the Authority. NOW,THEREFORE,BE IT RESOLVED BY THE ALASKA ENERGY AUTHORITY AS FOLLOWS: Section 1.Effective as of February 1,2011,Sara Fisher-Goad is appointed Executive Director and Secretary-Treasurer of the Authority. Section 2.The Board of Directors of the Authority ratifies its selection of Sara Fisher-Goad to be Executive Director of the Authority,and further ratifies its determination that the employment of Sara Fisher-Goad as Executive Director of the Authority is necessary to exercise the Authority's powers,duties and functions prescribed by AS 42.45,AS 44.83,and all other applicable laws of the State of Alaska. Section 3.The Executive Director of the Authority is authorized and instructed to enter into a contract with AIDEA providing for reimbursement of costs associated with employment by AIDEA of the Executive Director of the Authority. Section 4.Effective as of February 1,2011,Michael Harper's appointment as Acting Executive Director and Secretary-Treasurer of the Authority is terminated,and the continuation of Michael Harper's appointment as Deputy Director-Rural Energy and Assistant Secretary of the Authority is confirmed. Section 5.Effective as of February 1,2011,Sara Fisher-Goad's appointment as Deputy Director -Operations and Assistant Secretary of the Authority is terminated. Section 6.The Executive Director of the Authority,or any Authority staff member designated by her,is hereby authorized to sign,on behalf of the Authority,all contracts,deeds and other instruments made by the Authority,and related documents. Section 7.From time to time,as may be required on a temporary basis,when the Executive Director is unavailable,the Executive Director may designate any Assistant Secretary of the Authority to act on her behalf.The person so designated shall have all the assigned duties and powers of the Executive Director of the Authority,subject to any limitations imposed by the Executive Director in the designation of authority,during the time period designated by the Executive Director. Section 8.Actions taken by the Executive Director and Secretary-Treasurer of the Authority,or any Authority staff member designated by her on or from February 1,2011,to the effective date of this resolution,are confirmed and ratified. Section 9.This resolution takes effect immediately. DATED at Anchorage,Alaska,this 14"day of February,2011. .Mule 74 (SEAL)Chair yo] ATTEST -)-6 lbs apn Appointment of Executive Director Resolution No.2011-01 Secretary Page 2 of 2 NED Exhibit BR-2 ENERGY AUTHORITY MEMORANDUM TO:Board of Directors Alaska Energy Authority FROM:Sara Fisher-Goad SaiExecutiveDirector DATE:December 6,2012 SUBJECT:Resolution No.2012-06 Agreement between AEA and AIDEA related to AEA project working capital loans and personnel services. The attached Resolution No.2012-06 (Resolution)accomplishes two primary goals.First,it authorizes AEA to borrow up to $7.5 million from the Alaska Industrial Development and Export Authority (AIDEA)for working capital needs arising from AEA projects.Many of AEA's project expenditures are made on a reimbursement basis -amounts must be paid in order to collect funds from the final payment source (State,Federal or other).Amounts AEA borrows from AIDEA must be repaid after AEA receives reimbursement funds,and within one year.Second, the Resolution authorizes AEA to obtain from AIDEA personnel services,overhead expenses, administrative support,and other related services AIDEA provides to AEA,and to enter appropriate financial arrangements for AEA to reimburse AIDEA for those services. Resolution No.2012-06 also repeals and will replace Resolution No.2001-03 which authorizes AIDEA to lend of up to $2.5 million to AEA for expenses arising from AEA owned,operated and maintained power projects,and from power project and bulk fuel facilities to which AEA participates in development or construction.Resolution No.2001-03 also authorizes AIDEA to provide administrative and overhead support and services to AEA and for AEA to reimburse AIDEA for those services. Adopting Resolution No.2012-06 is appropriate and desirable because the number and size of AEA's grant,energy development,and energy conservation programs,and AEA's other statutory authorities and responsibilities have significantly expanded after Resolution 2001-03 was approved in 2001.The expansion in AEA's program activity has increased AEA's working capital needs for projects.The available borrowing amount of $2.5 million from AIDEA is no longer adequate for AEA to efficiently manage its programs.The expansion in AEA's program activity has also increased the types of projects for which AEA has working capital needs. The Resolution increases the maximum aggregate amount AIDEA may lend to AEA to $7.5 million.Staff anticipates that $5 million will generally be the maximum amount required,but occasionally one or more large project bills must be paid which will increase the amount borrowed over $5 million.Amounts borrowed from AIDEA are repaid regularly by AEA,typically within one month. 813 West Northern Lights Boulevard Anchorage,Alaska 99503 1 907.771.3000 Toll Free (Alaska Only)888.300.8534 F 907.771.3044 The Resolution also expands the types of projects for which AIDEA may lend amounts to AEA. The Resolution provides working capital for all AEA project needs,and is not limited to power projects AEA owns,operates and maintains,or from power projects and bulk fuel facilities to which AEA participates in development or construction.The additional types of projects may include rural power system upgrades,alternative energy and efficiency,conservation, transmission line extensions and interties,and other similar projects.Loans for the Susitna- Watana Hydro Electric project are not expected to be obtained under the Resolution. The Resolution also repeals Resolution No.2001-03. Staff recommends approval of Resolution No.2012-06. ALASKA ENERGY AUTHORITY RESOLUTION NO.2012-06 RESOLUTION OF THE ALASKA ENERGY AUTHORITY AUTHORIZING BORROWING FROM THE ALASKA INDUSTRIAL DEVELOPMENT AND EXPORT AUTHORITY RELATED TO WORKING CAPITAL FOR'PROJECTS, AUTHORIZING AGREEMENTS RELATED TO PERSONNEL SERVICES,,REPEALING RESOLUTION NO.2001-03,AND PROVIDING FOR RELATED MATTERS WHEREAS,Resolution No.2001-03 authorizes the Alaska Energy Authority ("AEA”)to borrow amounts from,and arrange for repayment to,the Alaska Industrial Development and Export Authority ("AIDEA”)related to working capital for power projects owned,operated,or maintained by AEA or for power projects or bulk fuel facilities to which AEA participates in development or construction,subject to certain restrictions,including that the unpaid balance of loans at any time may not exceed,in the aggregate,$2,500,000; WHEREAS,Resolution No.2001-03 also authorizes AEA to enter into appropriate financial arrangements with AIDEA for the payment for personnel services,overhead expenses, administrative support,and other related services AIDEA provides to AEA,and provides for related matters; WHEREAS,the number and size of AEA's energy development,conservation and grant programs,and AEA's statutory authorities and responsibilities have expanded since adoption of Resolution No.2001-03,including AEA programs regarding rural power systems,bulk fuel facilities,waste heat,energy grants,energy development,energy conservation,energy efficiency,and energy audits; WHEREAS,the expansion of AEA programs,statutory authorities and responsibilities has increased the scope of the types of projects and the amounts for which AEA has working capital needs; WHEREAS,AIDEA has the authority to make loans,and AEA has the authority to accept loans,to finance AEA's working capital needs related to projects; WHEREAS,AEA continues to need,and AIDEA continues to provide to AEA,personnel services,overhead,administrative support,and other related services,which require the continuation of appropriate financial arrangements between AEA and AIDEA;and WHEREAS,it is appropriate and necessary or desirable to repeal and replace Resolution No.2001-03 with this Resolution No.2012-06 to increase the maximum aggregate loan amount available from AIDEA to AEA related to working capital needs for projects,and to continue to authorize agreements to establish appropriate financial arrangements between AEA and AIDEA related to personnel services,overhead,administrative support,and other related services. NOW,THEREFORE,BE IT RESOLVED BY THE ALASKA ENERGY AUTHORITY AS FOLLOWS: Section 1.The Executive Director of AEA and any Deputy Director of AEA designated by the Executive Director are authorized to enter into commitments,agreements, and financial arrangements on behalf of AEA to obtain and provide for the repayment of loans made by AIDEA to AEA for the purpose of paying working capital or other expenses of AEA relating to projects,subject to limitations established in Section 3 of this Resolution. Section 2.The Executive Director of AEA and any Deputy Director of AEA designated by the Executive Director are authorized to enter into appropriate financial arrangements on behalf of AEA to reimburse AIDEA for personnel services,overhead expenses,administrative support,and other related services AIDEA provides to AEA. section 3.The unpaid balance of loans described in Section 1 of this Resolution shall not at any time exceed,in the aggregate,$7,500,000.A loan described in Section 1 of this Resolution shall not bear interest.AEA shall identify for each loan described in Section 1 of this Resolution,any designated sources of repayment of the loan from amounts to be received by AEA from the State of Alaska or from other sources that,in the opinion of the Executive Director or designated Deputy Director,will provide adequate assurance of repayment of the loan.Each loan described in Section 1 of this Resolution shall mature and be payable in full no later than the earlier to occur of (a)twelve months after the date of disbursement of the amount loaned,or (b)as soon as practicable after sufficient amounts from the identified sources of repayment described in the preceding sentence are available to repay the loan. Section 4.All loans,commitments,agreements,and financial arrangements between AIDEA and AEA that comply with the terms of this Resolution are hereby ratified, affirmed,and approved,including all outstanding loans,commitments,agreements,and financial arrangements between AIDEA and AEA made under Resolution No.2001-03. Section 5.Resolution No.2001-03 is repealed effective when this Resolution No. 2012-06 becomes effective. Resolution No.2012-06 Page 2 Dated at Anchorage,Alaska this 6"day of December,2012. A as ae /-'\a ..\er,. .oO ;.-fa Ny ;-$ro:pout Chair YW ee at Suc token GonSecretary Resolution No.2012-06 Page 3 Exhibit D-1 State of Alaska Department of Acministration D G SDivisionofGeneralServices DELEGATION OF PURCHASING AUTHORITY REVISED APRIL,2044 PROCUREMENTS PERMITTED UNDER THIS DELEGATION........scsssrscsersossocsessunsssersenscucesecessssasssessenesseesseansaenscassessessesenses 3 AUTHORITY TO APPROVE REQUESTS FOR ALTERNATE PROCUREMENT (RAPS)WITHIN THE MONETARY LIMITS SET FOR SMALL PROCUREMENTS ..vee meatesesensescauesscetenesetenes enecsssccersassanesserassoan epsasnneestateons 4 PROCUREMENT RESTRICTIONS UNDER THIS CELEGATION ......scssoossscssscsscnsnseaesssastescssenosstsatosnsensentoesstsuassesernestsaenssensae!4 GENERAL REQUIREMENTS:.u.....:sc-ssscescsssorsestsccnsesneseusensecseeananstnensesenegesseunitiasneussnssansoessetvavssdsadbesnaeosseccasancanssssssasessasecese 5 COMPETITIVE BIDS OR PROPOSALS NOT REQUIRED .......:0-s.-scsssssesessenssecesseenensaeneasatsnondneatadssarcesersenssoneassvesseeosensanmeacees 6 FORMS AND REPORTS AGENCIES ARE REQUIRED TO PROVIDE TO DGS .....ccccstrsceeesestcessessarsssactecsecseessesensassssesssaneses 6 VIOLATIONS...nneaseaaaaaesnssseeseene vevvaceccuoessasnasancaes .soauauaneesanveasineecsconsacrscssesnssnseseeased Division of General Services [|Delegation of Purchasing Authority This delegates purchasing authority to your department and the boards,commissions,public corporations and other agencies under your span of control.It supersedes all previous delegations granted by the Department of Administration.It Is made based on the determination that your agency has a satisfactory performance history exercising similar authority;employees trained in procurement matters;and agency procurement policies and procedures which complement AS 36.30,2 AAC 12 and the Alaska Administrative Manual.It will remain in effect until it is revised or withdrawn.It covers supplies,services and professional services,other than construction and State Equipment Fleet purchases,except where otherwise noted.Prior delegations should be discarded to eliminate any possible confusion. This delegation is made directly ta you as the head of an agency and it authorizes procurements that are specific to your department.Only the Division of General Services (DGS)may award contracts for multiple departments.You may further delegate this authority within your department,provided that you do so in writing;and for procurements above $5,000,that such authority is delegated only to individuals certified under the DGS Procurement Officer Certification Program. Individuals conducting procurements above $5,000 need both a written delegation of purchasing authority and certification depending on the dollar amount of procurements they perform. DGS'Procurement Officer Certification Program recognizes that professional services contracts and amendments may be signed by a non-certified state official,provided a certified procurement officer is responsible for the solicitation,oversees the evaluation,issues the Notice of Intent and drafts the contract or amendment. Additionally,certification is not required for Commissioners,Deputy Commissioners,or other positions above the Director of Administrative Services level that approve Small Procurement Requests for Alternate Procurement {Single Source and Limited Competition). Procurements must be conducted in accordance with AS 36.30,2 AAC 12,the Alaska Administrative Manual,and DGS Procurement Information Messages (PIMs).You are responsible for ensuring that the individuals to whom you delegate purchasing authority are certified at the appropriate fevel and perform procurement duties in a prudent and legal manner. Your agency's procurement policies and procedures must remain current and in compliance with AS 36.30,2 AAC 12,the Alaska Administrative Manual,and DGS PIMs.Purchasing violations must be investigated in accordance with Alaska Administrative Manual sections 82.300-350,Per AAM 82.330,a violation report must be submitted to the Chief Procurement Officer for review. L 4 Page 2 Division of General Services |Delegation of Purchasing Authority (a)You are delegated authority to procure goods,services,and professional services regardless of the estimated value,provided the contract is intended only for your department.Procurements which exceed the amount established for small procurements must be procured through formal competitive sealed bids or competitive sealed proposals in accordance with AS 36.30 and 2 AAC 12.This authority is conditioned on the use of the 5%Alaska Bidder Preference,5%Alaska Veteran Preference,10%Alaskan Offerors Preference,and other statutory preferences,as applicable. The procurement officer must determine in writing that the use of a competitive sealed proposal is more advantageous prior to using the competitive sealed proposals process in lieu of the competitive sealed bid process. However,this determination {s not required when procuring professional services or the other supplies and services listed in 2 AAC 12.215. A solicitation number must be obtained from DGS prior to taking any procurement actions on purchases which exceed the amount established for small procurements.This solicitation number must be referenced on all documents and notices associated with the procurement. Within five days of award of the procurement,agencies must forward a completed Procurement Report (form 02- 115}to DGS for each procurement made under this authority which exceeds the amount established for small procurements. (b)You may contract directly for smail procurements in accordance with AS 36.30,2 AAC 12 and the Alaska Administrative Manual.The purchasing agency shall make award to the lowest quotation when soliciting quotes, or the informal proposal that is determined to be most advantageous when soliciting informal proposals. (c)You may purchase directly from contracts in the Contract Award Manual (CAM)according to the terms of the contract.Some of the contracts in the CAM are mandatory-use.Items on a mandatory contract award may not be purchased from another source. (d)You may procure as necessary in response to an emergency.Prior to making an emergency procurement,a determination of emergency must be made by the Chief Procurement Officer unless there is not sufficient time for the Chief Procurement Officer to make the determination per AS 36.30.310 (generally,if action needs to be taken within 72 hours),in which case,an agency official must make a determination of emergency. The procurement must be made In accordance with 2 AAC 12.450.A record of each agency emergency determination,including a copy of the determination,the procurement document,and a Procurement Report (form 02-115),must be prepared and forwarded to DGS. (e)If you wish to make a Single Source or Limited Competition procurement which exceeds the limit established for small procurements under AS 36.30,you must complete a Request for Alternate Procurement (RAP},(form 02-100)and obtain Chief Procurement Officer approval as required by AS 36.30,2 AAC 12 and the Alaska Administrative Manual. {f)Hf you wish to conduct an innovative procurement,you must complete a Request for Alternate Procurement {form 02-100}and secure Chief Procurement Officer approval as required by 2 AAC 12.575.You must then submit a procurement plan to the Department of Law and obtain their approval. Page 3 Division of General Services |Delegation of Purchasing Authority (g)You may purchase directly from a Certified Employment or Youth Job Training Program,In unlimited amounts,without competitive bidding,in accordance with AS 36.30 and 2 AAC 12.A list of Certified Employment Programs is available from DGS. (h)Your agency's procurement officer is responsible for issuing a decision on a protest of a procurement which exceeds the amount established for small procurements per AS 36.30.580,and for submitting a Protest Report per AS 36.30.605.You or your designee is responsible for resolving protests of small procurements in accordance with 2 AAC 12.695. (1)You may purchase directly from the Department of Corrections'Prisoner Employment Program (PEP), formerly the Alaska Correctional Industries (ACI)program.Purchases from the Department of Corrections'PEP program are exempt from the procurement code per AS 36.30.850 (c).No special determinations are required. Payment to the PEP for purchases should be made through Agency Journal Entries. (}}in Juneau,If your agency has mission critical mailing equipment and/or service acquisition needs not satisfied by PC Postage products,the purchase or lease of mailing equipment must be Justified and submitted to DGS for approval.In all locations,including Juneau,you may purchase PC Postage products from vendors licensed by the United States Postal Service.Your agency may also procure the USPS'Net-Post Mailing Online fulfillment house services for letters,brochures,post cards,cards and certified mail In unlimited quantities.These services are exempt from the Procurement Code under AS 36.30.850{(c). {k)You may procure employee housing in accordance with AS 36.30,2 AAC 12 and the Alaska Administrative Manual. As the head of an agency you are delegated the additional authority to approve Requests for Alternate Procurement (RAPs),{form 02-100)in amounts which do not exceed the statutory limit for Small Procurements for: (a)Single Source procurements for supplies,services,and professional services,in accordance with AS 36.30.300,2 AAC 12.410-420 and the Alaska Administrative Manual. (b)Limited Competition procurements for supplies,services,and professional services,in accordance with AS 36.30.305,2 AAC 12.430 and the Alaska Administrative Manual. This approval authority may not be delegated below the level of Deputy Commissioner,Assistant Commissioner,or Director of Administrative Services.Agencies are required to provide DGS with a Procurement Report (form 02- 115)and copies of all approved Single Source and Limited Competition procurements within five (5)days of the date the procurement is completed. (a}You may not procure leased office space. (b)You may procure non-office leased space estimated to cost no more than $50,000 for the life of the fixed term of the contract plus any renewal options. Page 4 Oivision of General Services |Delegation of Purchasing Authority (c)You may procure printing in accordance with AS 36.30,2 AAC 12,and AAM 83.010 -83.065. (d)When procuring supplies,services,or professional services under small procurement procedures,the minimum number of quotations or informal proposals must be sought from Alaskan vendors prior ta soliciting any non-Alaskan vendors,unless the procurement officer determines in writing that soliciting the minimum number of quotes or informal proposals from Alaskan vendors is not practical per 2 AAC12.400(f)and AAM 81.220. {e)When procuring supplies,services or professional services through competitive sealed bids or competitive sealed proposals,you may not solicit vendors located outside Alaska without first securing a determination by the Chief Procurement Officer that limiting competition to Alaskan vendors is not practicable. (6)All service contracts above $50,000 must be performed in the United States,unless a waiver is approved by the Chief Procurement Officer.The agency must address why a waiver is in the states best interest and why timiting competition to service providers located in the United States could damage the agency's ability to accomplish its public mission per AAM 81.015. (g)You may not enter Into or amend a contract above $100,000 with a company established and headquartered,or incorporated and headquartered,in a Tier 3 country as categorized in the most recent United States Department of State's Trafficking in Persons Report unless the company has submitted a certified copy of its policy regarding human trafficking and such policy is approved by the State of Alaska per AAM 81.025. (h)You may not procure from GSA federal supply schedules,pending further action by GSA,and procedures from DGS. {i)You may not hire employees through the procurement process,or as an exempt procurement under AS 36,.30.850.Under certain circumstances,such as the hiring of foreign nationals who will be working in foreign countries,an agreement that appears to create an employer/employee relationship may be appropriate.These employment agreements [2 AAC 12.990{a)(6)]are not procurements and they are not professional services acquisitions.DOA,Division of Personnel and the Department of Law should review any such proposed employment agreement. If you are unsure whether a procurement will result in an employer/employee relationship,check with the Department of Personnel and the State Accountant in the Division of Finance.If the services you require result in an employer/employee relationship,the person must be hired through the personnel system,not the procurement system [(AAM 81.010 and 2 AAC 12.990 (a)(6))J. (a)The Commissioner of the Department of Natural Resources may procure,in unlimited amounts,fire fighting equipment and supplies directly from the Federa!Government,through GSA. (b)The Commissioner of the Department of Natural Resources may procure,In unlimited amounts, concession contracts for State parks in accordance with AS 41.21.020-027. {c)The Commissioner of the Department of Transportation and Public Facilities may purchase,in unlimited amounts,docking terminal and ancillary facilities,including office space and services such as line handling,ticket sales,reservations,vehicle staging,and passenger waiting rooms for the Alaska Marine Highways System. Page 5 Division of General Services |Delegation of Purchasing Authority {a)Agencies are to submit requirements for all telephones (including cell phones)and telephone systems, leased or purchased telephone lines or circuits,radios and the following types of equipment directly to the Department of Administration,Enterprise Technology Services:data communications,electronic navigation, paging,public address,video transmission,teleconferencing,video conferencing,image transmission and telecommunications.Data communications equipment includes but is not limited to:modems (with the exception of Hayes compatible PC dial-up modems),bridges,routers,multiplex equipment,and terminal control units. Telephone systems include:voice over Internet protocol (VOIP),key systems,telephone switches,desk-top instruments,voice mail,automated attendant,automated call sequencers,and similar equipment. (b)Agencies are to ensure information technology systems,solutions,and services are compliant with State Information Technology and Security Policy and statewide Technology Management Council (TMC) standards.The Department of Administration,State Security Office establishes statewide Information Technology Security Policy and the TMC establishes statewide technology standards.State agencies are not allowed to procure other brands or solutions without receiving a TMC waiver nor deploy solutions that are not in compliance with State Information Technology and Security Policy.The procurement officer is also required to make a written determination for all brand specific technology purchases (see PIM 70,Brand Specific Determinations and Standards). (c)Agencies are to submit requirements for construction,State Equipment Fleet vehicles,mobile homes, portable shelter units,and prefabricated and/or sectional office,housing or shelter units directly to the Department of Transportation and Public Facilities. (a)Competitive bids or proposals are not required to procure vessel maintenance and repair if the work is done by an Alaskan marine maintenance and repair facility per AS 36.90.050. (b)Competitive bids or proposals are not required for the goods and services exempted under AS 36.30, Article 10,General Provisions or Appendix 1 to AAM.82.When conducting an exempt procurement,you must ensure the supplies,services,or professional services qualify as an exemption under AS 36.30.850 or Appendix 1. Check with the Division of General Services if you are unsure whether a particular item is exempt from AS 36.30. {c)Competitive bids or proposals may not be required for certain goods or services acquired under AS 36.30,Article 9,Intergovernmental Relations.Cooperative purchases with qualifying entities may be made after approval of a cooperative purchasing agreement by DGS. Agencies are required to provide DGS with copies of the following forms and reports within five (5)days of the date the procurement is completed: (a)Procurement Report Form, (b)Agency approved single source RAPs, {c)Agency approved limited competition RAPs, (d)Agency determinations of an emergency,and Page 6 Division of General Services |Delegation of Purchasing Authority {e)Records of innovative procurements. rr o>me tebe Violation of procurement statutes,regulations,the Alaska Administrative Manual,or the terms set forth above may be cause for the revocation of part or all of this delegation by the Chief Procurement Officer and/or revocation or reduction of an individual's Procurement Officer Certification issued by DGS.Violations may also result in employee discipline by the purchasing agency up to and including dismissal. A person who contracts for or purchases supplies,equipment for the state fleet,services,professional services,or construction in a manner the person knows to be contrary to the requirements of this chapter or the regulations adopted under this chapter is liable for all costs and damages to the state arising out of the violation.A person who intentionally or knowingly contracts for or purchases supplies,equipment for the state fleet,services, professional services,or construction under a scheme or artifice to avoid the requirements of this chapter Is guilty of a class C felony (Ref.AS 36.30.930 Civil and Criminal Penalties). cc:Office of Management &Budget Legislative Audit Lt.Governor's Office Division of General Services Page7 Exhibit D-2 DELEGATION OF CONSTRUCTION AUTHORITY From Department of Traasvortation and Public Facilities To the Alaska Energy Authority For e AGENCY-WIDE GENERAL CONSTRUCTION AND MAINTENANCE ACTIVITY Under AS 36.30.015(a)and 2 AAC 12.740,the Commissioner of the Department ofTransportationandPublicFacilities(DOT&PF)hereby delegates to the Executive Director of the Alaska Energy Authority the duties and responsibilities for construction,for and in support of those programs administered by the Alaska Industrial Development and Export Authority,and the Alaska Energy Authority(hereafter called "AGENCY”),under the following criteria and conditions. For the purpose of this Delegation,construction is defined in AS 36.30.990(6)as: "'construction'means the process of building,altering,repairing,maintaining,improving,or demolishing a public highway,structure,building,or other public improvement of any kind to real property other than privately owned real property leased for the use of agencies;it includes services and professional services relating to planning and design required for the construction;it does not include the routine operation of a public improvement to real property nor does it include the construction of public housing.” The AGENCY is granted unlimited authority for construction related procurements. Force Account work limits are set forth in Section 3 of this document. Waivers:The Executive Director of the AGENCY may approve Single Source construction Waivers that do not exceed the amount for small procurement under AS 36.30.320(a)and Limited Competition construction waivers,which are limited to $100,000 under AS 36.30.305. The Commissioner of DOT&PF must approve all other waivers.Approval shall be requested using DOT&PF Form 25D-026 (DOT&PF Waiver Request for AlternateProcurementMethods).Submit these requests directly to the DOT&PF Chief Contracts Officer for processing. Section 1.AGENCY Employee Construction Contracting Warrant and Delegation Authority: Construction related procurement authority may only be sub-delegated to employees of the AGENCY who maintain a current DOT&PF Warrant Certificate. The AGENCY must be in compliance with DOT&PF Policy &Procedure 10.02.021 (Construction Contracting Warrant System)as a condition for Delegation of Authority for Construction Page 1 of 4 March 1,2014 maintaining an active Delegation.The Construction Contracting WarrantSystemappliestothoseemployeesofAGENCIESwhoexecuteanywrittenconstructionrelatedagreementorotherundertakingthatobligatesorbindsthestateinanyrespect,whether or not it involves the payment of money. The AGENCY must provide to the DOT&PF Chief Contracts Officer on an annual basis or as changes occur: e an organizational chart naming its'Warranted staff; »a description of each Warranted position including its function and construction related AGENCY authority;and «designation of the AGENCY's contact person(s). The Construction Contracting Warrant certifies that the certificate holder hasreceivedspecificconstructionprocurementtrainingandincludesasignaturefromtheAGENCYauthorizinga"delegation of authority”by the authorized AGENCY official. Section 2.Contract Solicitations: The acquisition of goods and services must be obtained through a solicitationprocessconformingtotheDOT&PF Small Procurement Manual for Construction Projects on projects under the small procurement limit.On projects estimated to be over the small procurement limit,the formal solicitation process required by the Procurement Code must be followed. Section 3.Force Account:Unlimited authority is granted to the AGENCY to perform projectadministration,design,and construction utilizing force account (the performance of construction by AGENCY employees)methods for any project.Total construction project costs for force account methods include labor, materials,and equipment.Prior to commencing work on any project valuedinexcessof$5,000,the Executive Director of the AGENCY shall make,in writing,the determination as required under AS 35.15.010(b). The determination shall be based upon an analysis that demonstrates the cost to the state will be less than that incurred from a formally advertised or negotiated contract.Complete records,including the names of the employees involved in the work,must be maintained.The AGENCY's requirements for acquisition of equipment or materials must be followed. Force Account requests in excess of $100,000 must be approved by the DOT&PF Chief Contracts Officer (see P&P 10.02.0132). Section 4.DOT&PF Cooperative Assistance Efforts: By mutual agreement or when the AGENCY lacks appropriate expertise orknowledgerequiredtosuccessfullycompleteaproject,the Chief of Statewide Facilities or appropriate DOT&PF Regional Director will provide assistance to facilitate construction using a formal solicitation process or Force Account procedures. AGENCY reimbursement of DOT&PF costs,as well as the degree of DOT&PF assistance and responsibility,shall be determined and agreed to in writing by the parties prior to the commencement of any project related work. Section 5.Cther Conditions: Delegation of Authority for Construction Page 2 of 4 March 1,2014 (B) {C) (D} (E) Any work done under the provisions of this delegation must be in accordance with all applicable statutes,codes,regulations,and standards.Formal construction contracting procedures shall be followed in accordance with the Alaska Statutes,Title 36 (the State Procurement Code),and 2 AAC 12. The AGENCY shall ensure compliance with the DOT&PF's Professional Services Agreement Manual or the Small Procurement Manual for Construction Projects as appropriate. DOT&PF standard contract clauses may be used as appropriate.Anymodificationstostandardclausesmusthavethepriorapprovalofthe Attorney General as to form,submitted through the DOT&PF Chief Contracts Officer. The DOT&PF may audit any AGENCY project for compliance with this delegation and/or for compliance with applicable DOT&PF design andconstructionstandardsandpoliciesasapplicable. Acceptable accounting records must be kept in AKSAS,or IRIS when the conversion is completed,for all related expenditures. Copies of all protests,claims,procurement officer's decisions,and all related correspondence must be promptly forwarded to the DOT&PF Chief Contracts Officer.A protest appeal on a project over the small procurement limit or on any claim appeal of a procurement officer's decision shall be directed to the office of the DOT&PF Commissioner for administrative resolution. The AGENCY will reimburse DOT&PF for services provided by DOT&PF personnel in accordance with the following fee schedule: 1.This delegation is contingent upon payment of an annual fee for the service and benefit received by the AGENCY under this delegation. 2.Actual costs for any per diem and travel. 3.Actual costs for any appeal on a protest or a claim (hearing officer fees and other administrative adjudication costs). 4.Costs related to project specific reviews and construction assistance. Examples include:preliminary engineering services,field inspections, reviews of plans,and specifications or code compliance,etc. Send all procurement reports to the DOT&PF Chief Contracts Officer (MS 2500)in accordance with the following schedule: 1.Small procurements made under AS 36.30.320(a)-no reporting required. 2.Single Source,Limited Competition,and Emergency procurements (regardiess of cost)using PART 6 of Form 25D-026 within 15 days of executing the contract.In addition;an excel spreadsheet is provided by the DOT&PF to the AGENCY to provide a consolidated fiscal year-end report that is due by September 30th of each year. 3.For all other procurements,a consolidated fiscal year-end report (excel spreadsheet provided by DOT&PF)is also due by September 30th. Delegation of Authority for Construction Page 3 of 4 March 1,2014 (F)As a condition to this delegation,the AGENCY Executive Director must, within thirty days of any material change effecting this Delegation,notify the DOT&PF Chief Contracts Officer.The information so provided will be used in determining the AGENCY's ability to continue to carry out their delegated authority under AS 36.30.015{a). AGENCY requests for increases in delegation on a general basis must be made to the DOT&PF Chief Cuntracts Officer. This delegation remains in effect until revised or revoked,and is subject to cancellation upon thirty days notice by either party. as rsLfIp/My }:':"fig'j.sé *«)j - Issued By:(fhe|A _..Date:__}UZoya7Mark@BrienFUERCentiannd,GT ey Chief Contracts Officer Alaska Department of Transportation and Public Facilities Delegation cf Authority for Construction Page 4 of 4 March 1,2014 Exhibit L- 1 29-LS1383\D CONFERENCE CS FOR SENATE BILL NO.196 IN THE LEGISLATURE OF THE STATE OF ALASKA TWENTY-NINTH LEGISLATURE -SECOND SESSION BY THE CONFERENCE COMMITTEE Offered:4/29/16 Sponsor(s):SENATORS HOFFMAN,MacKinnon,Bishop,Olson,Stedman,Stevens,McGuire,Micciche REPRESENTATIVES Edgmon,Muiioz,Herron A BILL FOR AN ACT ENTITLED "An Act relating to the amount appropriated for power cost equalization;relating to the use of certain unexpended earnings from the power cost equalization endowment fund; and providing for an effective date." BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: *Section 1.AS 42.45.080(c)is amended to read: (c)On July 1 of each year,the commissioner shall determine (1)the monthly average market value of the fund for the previous three closed fiscal years;and (2)the earnings of the fund for the previous closed fiscal year. *Sec.2.AS 42.45.085(a)is amended to read: (a)Five [SEVEN]percent of the amount determined by the commissioner of revenue on July 1 of each year under AS 42.45.080(c)(1)[AS 42.45.080(c)]may be appropriated [FOR THE FISCAL YEAR BEGINNING THE FOLLOWING JULY 1] for the following purposes: (1)funding the power cost equalization and rural electric capitalization fund (AS 42.45.100); SB0196D -I-CCS SB 196 New Text Underlined [DELETED TEXT BRACKETED] oOoOoSIDWAFPWHNO-NONOHONHHNNOESHFHFFFFEFFeOSOSnA&WNKFK&CFT0WnHDWnFPWNY|OC29-LS1383\D (2)reimbursement to the Department of Revenue for the costs of establishing and managing the fund;and (3)reimbursement of other costs of administration of the fund. *Sec.3.AS 42.45.085 is amended by adding new subsections to read: (c)If the amount appropriated under (a)of this section is insufficient to achieve the purposes of (a)(1)-(3)of this section,the amount shall be prorated among the purposes listed in (a)(1)and (2)of this section. (d)Ifthe earnings of the fund for the previous closed fiscal year,as calculated under AS 42.45.080(c)(2),exceed the appropriation under (a)of this section for the current fiscal year,the legislature may appropriate 70 percent of the difference between the earnings of the fund for the previous closed fiscal year,as calculated under AS 42.45.080(c)(2),and the appropriation made under (a)of this section for the current fiscal year as follows: (1)if the amount calculated under this subsection is less than $30,000,000,that amount to a community revenue sharing or community assistance fund;or (2)if the amount calculated under this subsection is $30,000,000 or more, (A)$30,000,000 to a community revenue sharing or community assistance fund;and (B)the remaining amount,not to exceed $25,000,000,to the renewable energy grant fund established under AS 42.45.045,to the bulk fuel revolving loan fund established under AS 42.45.250,or for rural power system upgrades or to a combination of the funds or purposes listed in this paragraph. *Sec.4.This Act takes effect June 30,2016. CCS SB 196 2-SB0196D New Text Underlined [DELETED TEXT BRACKETED] Exhibit R-1 Chapter 105 Administrative and Other Provisions Article 1.Administrative Provisions.(3 AAC 105.010 -3 AAC 105.020) 2.Operation of Projects.(3 AAC 105.300 -3 AAC 105.310) 3.Disposition of Assets.(3 AAC 105.400 -3 AAC 105.480) 4.General Provisions.(3 AAC 105.900) Annotations Editor's note:Effective 2/16/96 (Register 137),the regulations in this chapter were comprehensively revised and reorganized.The history line at the end of each section does not reflect the history of that provision before 2/16/96,nor is the section numbering related to that of previous versions of this chapter.The regulations in this chapter first took effect on April 13,1979,and appeared in Register 70; subsequent amendments were effective on September 13,1981 (Register 79),October 8,1981 (Register 80),March 21,1982 (Register 81),October 19,1985 (Register 96),October 28,1989 (Register 112),May 18,1990 (Register 114),September 23,1991 (Register 120),December 25,1992 (Register 124),and November 3,1993 (Register 128),and may be reviewed at the Office of the Lieutenant Governor. As to Register 151 (October 1999),the provisions of former 3 AAC 94,Alaska Energy Authority were relocated by the regulations attorney under AS 44.62.125(b)(6)to 3 AAC 105.The relocation was done to place Alaska Energy Authority regulations in one part of 3 AAC and to implement ch.58,SLA 1999. As of Register 151 (October 1999),the regulations attorney relocated 3 AAC 94 to 3 AAC 105 to place Alaska Energy Authority regulations in one part of 3 AAC. Article 1 Administrative Provisions Section 10.Scope of regulations. 20.Administration of assistance from other sources. 3 AAC 105.010.Scope of regulations This chapter applies to applicable programs and activities of the Alaska Energy Authority. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 Exhibit R-1 Page 1 of 8 3 AAC 105.020.Administration of assistance from other sources The authority may apply for,accept,and administer financial and other assistance from public agencies and private sources for the construction,financing,operation,and maintenance of power projects and for bulk fuel,waste energy,energy conservation,energy efficiency,and alternative energy facilities, equipment,or programs that are consistent with applicable provisions of AS 42.45,AS 44.83,this chapter,and 3 AAC 106 -3 AAC 108.The authority may accept conditions placed on federal and other state assistance that do not conflict with applicable provisions of AS 42.45,AS 44.83,this chapter,and 3 AAC 106 -3 AAC 108. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 Article 2 Operation of Projects Section 300.Operation of power projects. 310.Wholesale power rate. 3 AAC 105.300.Operation of power projects (a)The provisions of this section and 3 AAC 105.310 apply only to those projects acquired by the authority before August 11,1993,authorized as part of the energy program for this state under former AS 44.83.380.The authority will operate the projects using employees of the authority or,under a contract or lease with the authority,by a qualified utility. (b)An electric utility may apply to operate a power project under (a)of this section by submitting a written proposal.The proposal must contain the following information: (1)proof that the utility or utilities established as an electric operating entity are holders of a certificate of public convenience and necessity issued by the Regulatory Commission of Alaska to serve all or part of the area that is,or is intended to be,served by the power project; (2)the legal name of the utility or electric operating entity and the legal authority under which it was created and other information that will demonstrate that the applicant is eligible to do business in this state; (3)a record of the official action taken by the applicant's governing body authorizing the proposal; (4)the name,title,and address of the applicant's official correspondent or representative for purposes of the proposal; (5)the names and titles of the applicant's principal officers,including the chief executive officer and the general manager; (6)the names and addresses of the engineers,legal counsel,financial advisers or consultants that the applicant may have; Exhibit R-1 Page 2 of 8 (7)a general description of the operations of the electric utility or electric operating entity,including a recent history of the costs of operating,maintaining,and replacing equipment on those operations;and (8)an estimate of the annual costs to operate,maintain,and replace equipment on the power project. (c)If the power project serves only one electric utility,the authority will,in its discretion,accept a proposal from that electric utility for the operation and maintenance of the power project.If the authority,after reviewing the proposal from the electric utility,finds that the electric utility is a qualified utility,the authority will enter into a contract or lease with that qualified utility for the operation and maintenance of the power project. (d)If the power project serves more than one electric utility,the authority will,in its discretion,operate the power project itself or enter into a contract or lease with a qualified utility to operate the power project.The authority will,in its discretion,accept proposals from each electric utility or electric operating entity and will either (1)reject all proposals and operate the project itself;or (2)select that electric utility or electric operating entity that is a qualified utility and that the authority determines is the most capable of operating the project based upon the following criteria: (A)the financial history and stability of the electric utility or electric operating entity; (B)the ability of the electric utility or electric operating entity to attract qualified power project managers and operators; (C)the location of the project in relation to the service area ofthe electric utility or electric operating entity; (D)the likelihood of assisting in the lowering of rates to all classes of consumers over the longest period of time; (E)the ability of the electric utility or electric operating entity to satisfy the legislative goals of the energy program for the state. (e)Before entering into a lease or contract with an electric utility or electric operating entity to operate and maintain a power project,the authority will,in its discretion, (1)request additional information from the applicant considered appropriate; (2)conduct its own investigation; (3)receive any written comments from interested persons and organizations;and (4)consider any information received at one or more public meetings. (f)The authority's decision to enter into a contract or lease with a qualified utility will be in writing. (g)In accordance with sec.37,ch.18,SLA 1993,the authority will,to the maximum extent feasible, enter into contracts with public utilities under this section. History History:Eff.2/16/96,Register 137 Annotations Authority:Sec.37,ch.18,SLA 1993 AS 44.83.080 AS 44.83.396 Exhibit R-1 Page 3 of 8 3 AAC 105.310.Wholesale power rate The wholesale power rate for a project described in 3 AAC 105.300 will be set annually in accordance with the applicable power sales agreement. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 AS 44.83.398 Article 3 Disposition of Assets Section 400.Disposition of property. 410.Real property;fair market value. 420.Real property;less than fair market value. 430.Personal property disposition. 440.Notice. 450.Survey and appraisal. 460.Rejection of application or bids. 470.Appeal. 480.Completion of bid requirements. 3 AAC 105.400.Disposition of property (a)The provisions of 3 AAC 105.400 -3 AAC 105.480 apply to the disposition of property by the authority. (b)The executive director shall appoint a property officer of the authority who shall,subject to executive director authorization,be responsible for the disposition of the property of the authority. (c)The authority will,in its discretion,dispose of property owned or acquired by the authority under terms approved by the executive director or the property officer.A disposal under this section may be by sale,lease,exchange,or other disposition. (d)The executive director or the property officer may contract with other state agencies,project operators,real estate brokers,real estate agents,and other consultants to dispose of property under this section. (e)In disposing of property under this section,the authority will take into consideration market conditions and will attempt to dispose of the property for its fair market value except as provided in 3 AAC 105.420.The determination of fair market value of property for purposes of 3 AAC 105.400 -3 AAC 105.480 is solely at the discretion of the authority regardless of the result of an appraisal,if any,of the property. Exhibit R-1 Page 4 of 8 (f)The authority will dispose of property under this section only in compliance with applicable laws and only if the disposition is not prohibited under the terms of bond trustee agreements or other contracts to which the authority is a party or is otherwise bound.If the authority considers it necessary or desirable,the authority will consult with the trustee for any outstanding bonds of the authority before disposing of property under this section. (g)The authority will dispose of property under 3 AAC 105.400 -3 AAC 105.480 by spot bids, competitive sealed bids,public auction,or other disposition methods selected by the authority.If the disposition of property is by competitive sealed bids,each bid must be accompanied by a deposit,in the form of a money order or a certified or cashier's check,in an amount equal to ten percent of the amount bid.In the discretion of the authority,the bid deposit amount may be increased or decreased fora disposal of property.The authority will apply the winning bidder's deposit toward the purchase price of the property.After awarding the bid and completing the sale or entering into a purchase contract with the winning bidder,the authority will return the other bidders'deposits. (h)An employee of the authority may not directly or indirectly purchase property of the authority if the employee was directly or indirectly involved in the acquisition,maintenance,preparation for sale,or disposal of the property. (i)The authority will,in its discretion,determine to dispose of property of the authority by giving the property to the state.A disposal under this subsection is not subject to the other requirements of this section. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.410.Real property;fair market value Except for real property disposed of under 3 AAC 105.420,the authority will obtain an appraisal from a licensed appraiser to assist in the determination of the fair market value for disposal of real property. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.420.Real property;less than fair market value Unless otherwise required by law or contract,the disposition of property under this section to the state, an agency of the state,a municipality,a utility,or a non-profit corporation that is exempt from federal income tax under 26 U.S.C.501(c)}(3),in the discretion of the executive director may be for less than fair market value.An appraisal is not required for the disposal of property under this section. Exhibit R-1 Page 5S of 8 History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.430.Personal property disposition The property officer appointed under 3 AAC 105.400(b)will act on behalf of the authority in all matters pertaining to the disposition of personal property.An employee of the authority may not transfer or otherwise dispose of personal property of the authority without the express written authorization of the property officer appointed under 3 AAC 105.400(b). History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.440.Notice (a)The authority will give notice of its intention to dispose of property under 3 AAC 105.400,in the case ofa (1)real property disposition,at least 30 days before the disposition;or (2)personal property disposition,at least seven days before the disposition. (b)Unless otherwise required by law or contract,the authority will publish the notice required by (a)of this section by at least one ofthe following methods: (1)publication in a newspaper of general circulation in the state; (2)publication in a newspaper of local circulation in the area pertinent to the disposition; (3)other appropriate media publication. (c)A notice required by (a)of this section will contain sufficient information in commonly understood terms to inform the public of the nature of the action and the opportunity of the public to comment on the action.If the notice includes an invitation to bid with respect to real property,the notice will include the following: (1)a description of the real property; (2)the time,place,and terms of the proposed disposition; (3)a statement that the authority reserves the right to reject any and all bids; (4)a description of the deposit requirement of 3 AAC 105.400(g); (5)a statement that the winning bidder will not receive title to the property until the authority receives full payment or until the authority and the winning bidder enter into a purchase contract satisfactory to the authority. History History:Eff.2/16/96,Register 137 Exhibit R-1 Page 6 of 8 Annotations Authority:AS 44.83.080 3 AAC 105.450.Survey and appraisal If the authority disposes of real property,the authority will,in its discretion,require the person or entity acquiring the property to pay for costs of surveying and appraising the property as part of the disposition. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.460.Rejection of application or bids The authority will,in its discretion,reject an application,or all bids,in whole or in part in connection with a property disposition under 3 AAC 105.400 if it is in the best interests of the state. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.470.Appeal An applicant or bidder aggrieved by the authority's rejection of an application or bid,or the selection of a successful bidder,may appeal to the executive director within five working days after the authority's determination.The appeal must be filed in duplicate and state the grounds for the appeal.The executive director shall review the file and the aggrieved person's appeal and issue a written decision within 90 days after receipt of the appeal.The decision of the executive director is a final administrative order. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 3 AAC 105.480.Completion of bid requirements After the time for appeal under 3 AAC 105.470 has run,or after the executive director has issued a decision under that section,the authority will notify the successful applicant or bidder that the authority intends to proceed with the transfer of the property to that applicant or bidder.Within 30 days after receiving notice of the authority's intent,the applicant or bidder must pay to the authority any amount Exhibit R-1 Page 7 of 8 due and submit any documents required to comply with the provisions of 3 AAC 105.400 -3 AAC 105.480.If the applicant or bidder fails to comply within the time allowed under this section,the applicant or bidder forfeits any amount previously paid to,or upon the order of,the authority and all rights acquired in the property. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 Article 4 General Provisions Section 900.Definitions. 3 AAC 105.900.Definitions In this chapter,unless the context requires otherwise, (1)"authority”means the Alaska Energy Authority; (2)"executive director"means the executive director of the Alaska Energy Authority. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 44.83.080 Exhibit R-1 Page 8 of 8 Exhibit R-2 Chapter 109 Procurement for Alaska Energy Authority Managed Grants Article .Roles and Responsibilities.(3 AAC 109.010 -3 AAC 109.040) .Source Selection General Requirements.(3 AAC 109.060 -3 AAC 109.200) .Competitive Sealed Bidding.(3 AAC 109.210 -3 AAC 109.330) .Competitive Sealed Proposals.(3 AAC 109.340 -3 AAC 109.440) .Other Procurement Methods.(3 AAC 109.450 -3 AAC 109.500) .Contract Formation and Modification.(3 AAC 109.510 -3 AAC 109.560) .Legal and Contractual Remedies.(3 AAC 109.570 -3 AAC 109.620) .Additional Principles and Administrative Provisions.(3 AAC 109.650 -3 AAC 109.710) .General Provisions.(3 AAC 109.900 -3 AAC 109.900) Article 1 Roles and ResponsibilitieswomONnNDMfFWHY Section 10.Applicability. 20.General standards for procurements on behalf of a grantee. 30.Roles and responsibilities. 40.Applicability of other terms and conditions. 3 AAC 109.010.Applicability (a)This chapter applies to procurement for construction,supplies,services,and professional services for a project conducted by the authority in managing a grant on behalf of a grantee.This chapter applies only to procurements exempt from AS 36.30 (State Procurement Code)under AS 36.30.850(b)(1). (b)This chapter applies only to procurements initiated on or after July 10,2015. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.020.General standards for procurements on behalf of a grantee This chapter sets out procedures for the authority to conduct procurements on behalf of grantees in a manner that (1)provides for the needs of the grantee; Exhibit R-2 Page 1 of 40 (2)is efficient,cost-effective,and consistent;and (3)is justifiable to potential bidders,offerors,and contractors. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.030.Roles and responsibilities (a)The executive director is vested with and may exercise all of the rights,powers,and duties that relate to the management of construction,supplies,services,and professional services procured under this chapter by the authority on behalf of a grantee. (b)The executive director may delegate to other qualified employees of the authority any right,power, or duty described in (a)of this section,except that the executive director shall retain the right,power, and duty to consider appeals of protests under 3 AAC 109.570. (c)The executive director in exercising any right,power,or duty described in (a)of this section shall (1)appoint a chief procurement officer for the authority for procurements under this chapter;and. (2)take actions necessary to resolve any protest appeal under 3 AAC 109.570 or any appeal of a contract claim under 3 AAC 109.590. (d)Subject to a delegation of the authority from the executive director under this chapter,the chief procurement officer of the authority shall (1)procure or supervise the procurement of all supplies,services,construction,and professional services; (2)prescribe the time,manner,and form of making requisitions for supplies and services; (3)prescribe standard forms for solicitation documents and contracts; (4)take actions necessary to provide a recommendation to the executive director on a protest appeal under 3 AAC 109.570;and (5)provide for other matters that may be necessary to carry out this chapter. (e)An employee of the authority may exercise a delegated power only in accordance with the delegation and this chapter.The delegation must be in writing and may be revoked at any time,with or without cause,by the executive director. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.040.Applicability of other terms and conditions Exhibit R-2 Page 2 of 40 Nothing in this chapter prevents the authority from complying with the terms and conditions of a grant, gift,bequest,cooperative agreement,or federal assistance agreement. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 2 Source Selection General Requirements Section 60.Nondiscrimination in source selection. 70.Exclusion of prospective contractor from competition. 80.Lists of contractors. 90.Specifications. 100.Contract terms and conditions. 110.Construction project delivery methods. 120.Multiple awards. 130.Bid,payment,and performance bonds. 150.Public notice of competitive sealed bids and competitive sealed proposals. 160.Multi-step solicitations. 170.Amendments or extensions to a solicitation. 180.Cancellation of the solicitation or rejection of all bids or proposals. 190.Disposition of canceled or rejected bids or proposals. 200.Protest of cancellation of a solicitation. 3 AAC 109.060.Nondiscrimination in source selection Source selection and contract awards may not be based on discrimination because of race,religion, color,national origin,sex,age,marital status,pregnancy,parenthood,disability,or political affiliation. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.070.Exclusion of prospective contractor from competition (a)A procurement officer may issue a competitive solicitation that prohibits an individual or contractor from submitting a bid or proposal if Exhibit R-2 Page 3 of 40 (1)the procurement officer makes a determination that the contractor or individual assisted in drafting the invitation to bid or request for proposal and gained substantial information regarding the invitation to bid or request for proposal that is not available to other bidders or offerors; (2)the contractor or individual is listed on any state or federal list of debarred contractors; (3)the contractor or individual has headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C. 7107(b)(1)(C); (4)the contractor or individual would only act as a broker in supplying the goods or services and not add value to the transaction;or; (5)award to a specific contractor or individual could create a conflict of interest that would compromise the objectivity or purposes of the contract. (b)If an excluded contractor or individual submits a bid or proposal,the procurement officer shall reject the bid or proposal as nonresponsive. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.080.Lists of contractors For the purpose of providing notice for competitive bids and proposals,the chief procurement officer may establish and maintain contact information for contractors who have expressed an interest in doing business with the authority. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.090.Specifications (a)The purpose of a specification is to serve as a basis for obtaining,in an efficient,cost-effective,and consistent manner,a supply,service,or construction item suitable for the needs of the grantee. (b}The chief procurement officer shall monitor the content and use of specifications for supplies, services,professional services,and construction required under this chapter. (c)The chief procurement officer may obtain expert advice and assistance in the development of specifications and establish operational procedures governing the testing and trial use of equipment, materials,and other supplies by the authority,and the application of resulting information and data to specifications or procurements. Exhibit R-2 Page 4 of 40 (d)Specifications must promote overall economy for the purposes intended,encourage competition in satisfying the needs of the grantee,and to the extent practicable,emphasize functional or performance criteria necessary to meet the needs of the grantee and may not be unduly restrictive.The requirements of this subsection regarding the purposes and nonrestrictiveness of specifications apply to all specifications,including those prepared by architects,engineers,designers,and other professionals. (e)Except for small procurements under 3 AAC 109.460,a specification that limits the procurement of items to a single manufacturer's name or catalog number may be used only if the procurement officer determines in writing that only the identified brand name item or items will satisfy the needs of the grantee. (f)The procurement officer may use brand name or equal specifications for the purpose of identifying the performance and functional requirements of a commodity. (g)The procurement officer shall procure standard commercial products if practicable.Under the direction of the chief procurement officer,the authority may develop and maintain a list of standard commercial products. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.100.Contract terms and conditions (a)The chief procurement officer may determine the contractual provisions,terms,and conditions of solicitations and contracts,if the provisions,terms,and conditions are not contrary to statutory or regulatory requirements or the federal funding source governing the procurement. (b)The chief procurement officer shall develop and maintain standard contract terms subject to review and approval as to form by the attorney general.Modification of these standard terms is subject to review and approval as to form by the attorney general. (c)Contractual terms and conditions may not have the effect of unnecessarily limiting competition or exclusively requiring a proprietary supply,service,or construction item resulting in procurement from a single source unless no other requirement will suffice. (d)The standard contract terms will be included or referenced in all invitations to bid under 3 AAC 109.220 and requests for proposals under 3 AAC 109.350. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.110.Construction project delivery methods Exhibit R-2 Page 5 of 40 (a)One or more of the following project delivery methods may be used for procurements related to design;construction,routine repair,maintenance,management,or operations for projects or facilities of the grantee: (1)design-bid-build; (2)construction management; (3)construction management with the general contractor at nsk; (4)design-build; (S)design-build-operate-maintain; (6)design-build-finance-operate; (7)any variation of the methods described in (1)-(6)of this subsection. (b)Participation in a report or study that is subsequently used in the preparation of design requirements for a construction project does not automatically disqualify a firm from participating as a member of a proposing team offering proposals under any of the project delivery methods described in (a)of this section,unless the procurement officer determines that participation by the firm in the report or study provided that firm with a substantial competitive advantage. (c)Subject to the review and approval of the chief procurement officer,a construction procurement may be solicited by an invitation to bid under 3 AAC 109.220,a request for proposals under 3 AAC 109.350,multi-step bids or proposals under 3 AAC 109.160,or another procurement method under 3 AAC 109.450 -3 AAC 109.500. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.120.Multiple awards (a)The procurement officer may issue a solicitation with the intent to make multiple awards if award to two or more bidders or offerors of similar products or services is necessary for adequate delivery, service,or product compatibility.A multiple award shall be made in accordance with 3 AAC 109.210 -3 AAC 109.330 (competitive sealed bidding),3 AAC 109.340 -3 AAC 109.440 (competitive sealed proposals),or 3 AAC 109.460 (small procurements),as applicable. (b)If the intent of the solicitation is to establish multiple indefinite-delivery or indefinite-quantity term contracts,the contract period,including optional renewals and the process for selection and award of work orders or purchase orders,must be included in the original solicitation and subsequent contract award. History History:Eff.7/10/2015,Register 215 Annotations Exhibit R-2 Page 6 of 40 Authority:AS 44.83.080 3 AAC 109.130.Bid,payment,and performance bonds (a)Bid bonds or bid security in the amount of at least five percent of the bid price. (1)must be submitted with all invitations to bid for construction projects estimated to cost over $100,000;and (2)if needed for the protection of the grantee or authority as determined by the procurement officer, may be required in invitations to bid for contracts for supplies,services,or professional services. (b)Payment and performance bonds,or other acceptable security approved by the chief procurement officer, (1)shall be required for all construction contracts over $100,000;and (2)if needed for the protection of the grantee or authority as determined by the procurement officer, may be required for other contracts. (c)Any bid,payment,or performance bonding requirements must (1)be set out in the solicitation;and (2)identify the acceptability of alternative forms of security that may be substituted for the required bond,subject to approval of the chief procurement officer. (d)If the invitation to bid requires security,the procurement officer shall reject a bid that does not comply with the bid security requirement unless the officer determines that the bid fails to comply ina nonsubstantial manner with the security requirements. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.150.Public notice of competitive sealed bids and competitive sealed proposals (a)The procurement officer shall provide public notice of a competitive sealed bid or a competitive sealed proposal at least 21 days before the date for the opening of bids or proposals. (b)If the procurement officer determines in writing that a shorter notice period is advantageous or required for a particular project and adequate competition is anticipated,the 21-day period may be shortened. (c)Notice shall be posted on the Alaska Online Public Notice System and the authority's website.When practicable,notice may also include (1)publication in a newspaper calculated to reach prospective bidders; (2)posting in public places within the area where the work is to be performed or the material furnished; (3)communicating in other appropriate media,including posting in electronic media; (4)notifying bidders or offerors who have expressed an interest in previous solicitations of the authority; Exhibit R-2 Page 7 of 40 (5)electronically notifying prospective contractors on the appropriate list maintained by the authority under 3 AAC 109.080. (d)Nothing in this section limits use of additional methods of public notice in order to reach prospective contractors. (e)The procurement officer shall provide notice of an invitation to bid or request for proposals to a prospective contractor upon request. (f)The procurement officer may require payment of duplication costs or a cash deposit for supplying the invitation to bid. (g)Failure to comply with the notice requirements of this section does not invalidate a solicitation or the award of a contract. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.160.Multi-step solicitations When it is considered impractical to initially prepare a definitive purchase description to support an award based on price or other definitive criteria,the procurement officer may issue an invitation to bid, request for information,or request for proposals seeking the submission of technical information or data to be followed by an invitation to bid or request for proposals limited to (1)the bidders or offerors whose offers are determined to be technically qualified;or (2)a short list of bidders or offerors who are determined to be best qualified under the criteria set out in the first step of the solicitation. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.170.Amendments or extensions to a solicitation (a)Before the opening of bids or proposals,a solicitation may be amended,or time for opening may be extended,upon the procurement officer's determination that the extension or amendment satisfies 3 AAC 109.020.Notice shall be provided so that potential bidders or offerors have access to the amendment. (b)If,after the deadline for receipt of proposals under 3 AAC 109.360,there is a need for any substantial clarification or material change in the request for proposals,the request may be amended to incorporate the clarification or change.The procurement officer shall provide notice of the amended request and the date and time established for receipt of new or amended proposals. Exhibit R-2 Page 8 of 40 History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.180.Cancellation of the solicitation or rejection of all bids or proposals Before the deadline for receipt of bids or proposals,after the opening of bids or proposals,or after notice of intent to award but before award,the chief procurement officer may cancel the solicitation or reject all bids or proposals.Reasons for cancellation or rejection include one or more of the following: (1)the supplies,services,or construction being procured are no longer required; (2)ambiguous or otherwise inadequate specifications were part of the solicitation; (3)the solicitation did not provide for consideration of all factors of significance to satisfy 3 AAC 109.020; (4)prices exceed available money,and to adjust quantities or reduce services to accommodate available money would not be appropriate; (5)all otherwise acceptable bids or proposals received are at unacceptable prices; (6)there is reason to believe that the bids or proposals may not have been independently arrived at in open competition,may have been collusive,or may have been submitted in bad faith; (7)only one proposal or bid was received; (8)proceeding with the solicitation or award does not satisfy 3 AAC 109.020. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.190.Disposition of canceled or rejected bids or proposals (a)If at any time during the solicitation process a request for proposals or invitation to bid is canceled, the procurement officer shall return the bids or proposals if the time for filing a protest has expired and a protest has not been filed. (b)The procurement officer shall keep a list of returned bids or proposals in the procurement file. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Exhibit R-2 Page 9 of 40 3 AAC 109.200.Protest of cancellation of a solicitation Not more than 10 days after a notice of cancellation is issued by the procurement officer,an interested party may protest the cancellation of an invitation to bid or request for proposals by filing with the procurement officer a written protest that includes the information required under 3 AAC 109.570. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 3 Competitive Sealed Bidding Section 210.General policy. 220.Invitation to bid. 230.Pre-opening correction or withdrawal of bids. 240.Submission and receipt of bids. 250.Bid openings. 260.Correction and withdrawal of bids after bid opening. 270.Bid evaluation. 280.Determination of responsibility. 290.Rejection of individual bids. 300.Contract award for competitive sealed bids. 310.Subcontractors on construction contracts. 320.Documentation of award. 330.Notice of intent to award. 3 AAC 109.210.General policy The authority will use competitive sealed bidding when the requirements of the grantee are definite and can be sufficiently described by industry standards or practices so that price can be the primary basis for award,if the bid is determined to be responsive to the authority's requirements and the bidder is determined to be responsible. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Exhibit R-2 Page 10 of 40 3 AAC 109.220.Invitation to bid (a)When competitive sealed bidding is used,the procurement officer shall issue an invitation to bid.It must include a time,place,and date by which the bid must be received,a purchase description,a description of all contractual terms and conditions applicable to the procurement including the bid evaluation criteria,and the basis for award. (b)A bidder must have a valid Alaska business license before contract award. (c)A bidder for a construction contract must submit evidence of the bidder's registration under AS 08.18 at the time designated in the invitation to bid. (d)If the chief procurement officer makes a written finding that the release of the estimated cost of goods or services would adversely affect the ability of the authority to obtain the best competitive bid, the estimated cost of the goods or services is confidential during the solicitation process and may not be released to the public before bid opening. (e)A bidder,in the submission of a bid,must certify under penalty of perjury that the price submitted was independently arrived at without collusion. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.230.Pre-opening correction or withdrawal of bids (a)A bid may be corrected or withdrawn by written request received in the office designated in the invitation for bids before the time and date set for opening.. (b)A request under (a)of this section must provide authorization for the person making the correction or withdrawal to do so. (c)If a bid is withdrawn,the bid security,if any,shall be returned to the bidder along with the copies of the unopened bid documents not later than 15 days after bid opening.A copy of the correspondence requesting the withdrawal shall be included in the procurement file. (d)All documents relating to the correction of a bid shall be included in the procurement file. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.240.Submission and receipt of bids Exhibit R-2 Page 11 of 40 (a)A bid submitted on paper must be submitted in a sealed envelope with the invitation to bid number identified on the outside of the envelope.Upon receipt,the bid and any bid corrections shall be stored in a secure place until the time and date set for bid opening. {b)The procurement officer may issue and receive competitive sealed bids through an electronic bidding system,if the system is able to receive electronic bid documents and corrections to bid documents,document the date and time of receipt of bid documents,secure the electronic bid submissions from being reviewed until after the date and time of bid opening,and provide an accessible public record that documents the solicitation. (c)Bids shall be unconditionally accepted without alteration or correction,except as authorized in 3 AAC 109.230 and 3 AAC 109.260. (d)A bid,bid correction,or withdrawal of a bid received at the place designated for receipt of bids after the time and date set for receipt of bids is late. (e)A late bid,correction,or withdrawal may not be accepted unless the delay was due to an error of the authority. (f)A late bid or correction may not be opened or considered.The procurement officer shall document the date and time the late bid or correction was received and return the unopened late bid or correction to the bidder after the protest period has passed. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.250.Bid openings (a)The procurement officer shall open all bids and corrections received before the date and time designated in the invitation to bid. (b)All bid openings are open to the public at the place,date,and time designated in the invitation to bid. (c)The name of each bidder,the bid price,and other information determined appropriate by the procurement officer shall be tabulated at the bid opening.The tabulation is open to public inspection as soon as practicable after the bid opening. (d)The procurement officer shall open bids for public inspection when the notice of intent to award a contract is given. (e)To the extent the bidder designates and the procurement officer concurs,trade secrets and other proprietary data contained in a bid document will not be opened for public inspection under (d)of this section. History History:Eff.7/10/2015,Register 215 Exhibit R-2 Page 12 of 40 Annotations Authority:AS 44.83.080 3 AAC 109.260.Correction and withdrawal of bids after bid opening (a)After bid opening,changes in bid prices or other provisions of bids prejudicial to the interest of the grantee or fair competition are not permitted except as provided under (d)of this section. (b)If,before award,a procurement officer knows of an error in a bid,the procurement officer shall notify the bidder of the error. (c)Inadvertent errors discovered after opening but before award,other than minor informalities,may not be corrected.If a bidder submits proof that clearly and convincingly demonstrates that an inadvertent error other than a minor informality was made,the bidder may withdraw the bid. (d)The procurement officer may correct a bid that contains a minor informality.A correction of a minor informality may include correcting the bid submission to the intended correct bid price if the correct price is evident from the bid document.The procurement officer shall initial any correction made to the bid documents. (e)Adecision to permit the correction or withdrawal of a bid,or to cancel an award or contract based on bid mistake,shall be supported by a written determination made by the procurement offticer. (f)If a bidder is permitted to withdraw a bid before award,an action may not be maintained against the bidder or the bid security. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.270.Bid evaluation (a)The procurement officer shall evaluate bids based on the requirements set out in the invitation to bid,which may include criteria to determine acceptability such as inspection,testing,quality,delivery, and suitability for a particular purpose.An evaluation of product acceptability may be conducted to determine whether a bidder's offering is acceptable as set out in the invitation to bid.A bid that does not meet the acceptability requirements shall be rejected as nonresponsive. (b)The procurement officer shall evaluate bids to determine which bid offers the lowest price to the authority in accordance with the evaluation criteria set out in the invitation to bid.The criteria that will affect the bid price and be considered in evaluation for award must be objectively measurable,such as discounts,transportation costs,and total or life cycle costs.Evaluation factors need not be precise predictors of actual future costs,but to the extent possible the evaluation factors must (1)be reasonable estimates based upon information the procurement officer has available concerning future use;and (2)treat all bids equitably. (c)Criteria may not be used in bid evaluation if they are not set out in the invitation to bid. Exhibit R-2 Page 13 of 40 (d)Nothing in this section permits contract award to a bidder submitting a higher quality item than that designated in the invitation for bids if the bidder is not also the lowest bidder as determined under (b)of this section. (e)An alternate or conditioned bid submitted by a bidder that requires a change to a material term of the solicitation is nonresponsive unless a response to a specific condition or alternative is requested and authorized in the invitation to bid. (f)Negotiations are not permitted under this section except that after opening bids a procurement officer may request bidders extend the time during which the authority may accept a bid. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.280.Determination of responsibility (a)Before contract award the procurement officer shall consider whether the apparent low bidder is responsible.Factors that may be considered in determining whether the apparent low bidder is responsible include whether the bidder (1)has a satisfactory record of performance; (2)is qualified legally to contract with the authority under this chapter;and (3)has supplied all necessary information in connection with the inquiry concerning responsibility. (b)The procurement officer may require the apparent low bidder to demonstrate the availability of necessary financing,equipment,facilities,expertise,and personnel,by submitting. (1)evidence that the contractor possesses the necessary items; (2)acceptable plans to subcontract for the necessary items; (3)a documented commitment from,or explicit arrangement with,a satisfactory source to provide the necessary items;or (4)other information required by the procurement officer. (c)The procurement officer's determination of responsibility does not relieve the contractor from the requirements for performance under the contract. (d)If a prospective contractor supplies information in response to a request for infonnation made by a procurement officer under (b)of this section,the procurement officer may not open for public inspection under 3 AAC 109.250(d)financial information and any agreements with suppliers or subcontractors supplied in response to the request unless the prospective contractor gives prior written consent to their disclosure. (e)If the apparent low bidder is determined not to be responsible,the procurement officer may reject the bid and award the contract to the next lowest responsive and responsible bidder. History History:Eff.7/10/2015,Register 215 Exhibit R-2 Page 14 of 40 Annotations Authority:AS 44.83.080 3 AAC 109.290.Rejection of individual bids The procurement officer may reject an individual bid for one or more of the following reasons: (1)the bid is nonresponsive; (2)the bidder that submitted the bid is not responsible as determined under standards set out in 3 AAC 109.280; (3}the bidder is excluded from bidding under 3 AAC 109.070; (4)the supply,service,or construction item fails to meet the specifications or other acceptability criteria set out in the solicitation; (5)only one bid was received and the chief procurement officer determines that award does satisfy 3 AAC 109.020. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.300.Contract award for competitive sealed bids (a)The procurement officer shall award a contract based on the solicited bids with reasonable promptness by written notice to the lowest responsible and responsive bidder whose bid conforms in all material respects to the requirements and criteria set out in the invitation to bid. (b)Tie bids are low responsive bids from responsible bidders which are identical in price.If low tie bids exist,award shall be made through a random drawing or flip of the coin.Award may not be made by dividing the procurement among bidders offering identical low price bids. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.310.Subcontra text (a)Within five working days after the identification of the apparent low bidder for a construction contract solicited through a competitive sealed bidding,the apparent low bidder shall submit a list of the subcontractors the bidder proposes to use in the performance of the construction contract. Exhibit R-2 Page 15 of 40 (b)The list must include the name and location of the place of business for each subcontractor, evidence of each subcontractor's valid Alaska business license,and evidence of each subcontractor's registration as a contractor under AS 08.18. (c)A construction contractor or the apparent low bidder for a construction contract may replace a listed subcontractor if the subcontractor (1)fails to comply with AS 08.18; (2)files for bankruptcy or becomes insolvent; (3)fails to execute a contract with the construction contractor or bidder involving performance ofthe work for which the subcontractor was listed and the construction contractor or bidder acted in good faith; (4)fails to obtain bonding; (5)fails to obtain insurance acceptable to the authority; (6)fails to perform the contract with the construction contractor or bidder involving work for which the subcontractor was listed; (7)must be replaced in order for the contractor to satisfy required state or federal affirmative action requirements;or (8)refuses to agree or abide with the labor agreement ofthe construction contractor or bidder. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.320.Documentation of award Following award,a record showing the basis for determining the successful bidder shall be made a part of the procurement file. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.330.Notice of intent to award (a)Notice of intent to award does not constitute a formal award of a contract.The notice of intent to award must include (1)a statement of a bidder's right under 3 AAC 109.570 to protest the award,including the time within which the protest must be received;and (2)the name of the successful bidder. Exhibit R-2 Page 16 of 40 (b)Unless only one responsive bid is received,the notice of intent to award shall be issued to each bidder at least five days before formal award of the contract.If only one responsive bid is received,the contract award may proceed as soon as practical after the notice of intent to award is issued. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 4 Competitive Sealed Proposals Section 340.Conditions for use. 350.Request for proposals. 360.Submission,receipt,and treatment of competitive sealed proposals. 370.Evaluation of proposals. 380.Rejection of individual proposals. 390.Clarification of offers. 400.Proposal discussions with offerors and best and final offers. 410.Contract negotiations. 420.Contract award. 430.Documentation of contractor selection. 440.Notice of intent to award. 3 AAC 109.340.Conditions for use (a)The procurement officer may procure supplies or services by competitive sealed proposals if the procurement officer determines that the use of competitive sealed proposals is more practical or advantageous for satisfying 3 AAC 109.020 than competitive sealed bidding. (b)The following types of supplies and services for which the use of competitive sealed bidding is either not practicable or not advantageous for satisfying 3 AAC 109.020 may be procured by competitive sealed proposals without a written determination by the procurement officer: (1)professional services contracts; (2)architectural,engineering,and land surveying contracts; (3)design-build construction contracts; (4)design-build-operate contracts. (c)Award under competitive sealed proposals will be made to the responsive and responsible offeror who provides the highest ranked proposal based on the criteria and evaluation processes identified in the request for competitive sealed proposals if the procurement officer and the offeror are able to Exhibit R-2 Page 17 of 40 negotiate a contract for the benefit of the grantee consistent with the solicitation and the offeror's proposal. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.350.Request for proposals A request for competitive sealed proposals must contain (1)the date,time,and place for delivering proposals; (2)a specific description of the supplies,construction,services,or professional services to be provided under the contract; (3)the standard contract terms under which the supplies,construction,services,or professional services are to be provided,or a reference to those terms; (4)any other specific terms under which the supplies,construction,services,or professional services are to be provided; (5)the requirement that the offeror document having the required professional and contractor's licenses necessary to provide the supplies,services,or professional services requested; {6)the information necessary for an offeror to submit a proposal or references to any information that cannot reasonably be included with the request; (7)the requirement that an offeror certify under penalty of perjury that the price submitted was independently arrived at without collusion,if the proposal requires offerors to provide price information with their submissions;and (8)a description of the criteria that the procurement officer shall consider and the process that the procurement officer shall use when evaluating the proposals received;criteria may include (A)the offeror's experience in performing work similar to that sought in the request for proposals; evaluation of that experience may include (i)reviewing the offeror's conformance to specifications and standards of good workmanship, forecasting and containment of costs or prices,history of reasonable and cooperative behavior and overall concern for the interests of the customer,safety,risk management,and adherence to contract schedules;and (ii)the review of evaluations by private persons and officials of other government entities that have retained the services of the offeror,with respect to control of costs,quality of work,ability to meet deadlines,and other factors related to the offeror's experience; (B)the offeror's qualifications and competence of persons who would be assigned to perform the services,as reflected by technical training and education; (C)the offeror's ability to perform the services,as reflected by workload and the availability of adequate personnel,equipment,and facilities to perfom the services expeditiously; (D)the offeror's methods or proposed plan for delivering the goods or services; Exhibit R-2 Page 18 of 40 (E)efforts proposed to support the local economy; (F)the location of the office of the offeror where the work will be performed; (G)the offeror's employment practices with regard to women and minorities;and (H)the price for goods or services to be provided;evaluation of the price may include a comparison of total proposed costs,analysis of rates,life cycle costs,proposed fees,indirect costs,payment schedules or terms,or other factors that may have an impact on the total program cost of the goods or services;in soliciting architectural,engineering,and land surveying services,the procurement officer may only include price as an evaluation factor when,in the judgment of the procurement officer,the services required are repetitious in nature,and the scope,nature,and amount of services required are thoroughly defined by measurable and objective standards to reasonably enable firms or persons making proposals to compete with a clear understanding and interpretation of the services required;in order to include price as a factor in soliciting architectural,engineering,and land surveying services,a majority of the persons involved in evaluation of the proposals must be registered in the state to perform architectural,engineering,or land surveying services. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.360.Submission,receipt,and treatment of competitive sealed proposals (a)Proposals may be accepted electronically.Proposals submitted on paper must be submitted in a sealed envelope with the competitive proposal number identified on the outside of the envelope.Upon receipt,the proposal and any proposal corrections shall be stored in a secure place. (b)The procurement officer may issue and receive competitive sealed proposals through an electronic solicitation system,if the system is able to receive electronic proposal documents and corrections to proposal documents,document the date and time of receipt of proposal documents,secure the electronic submissions from being reviewed until after the date and time for receipt of proposals,and provide an accessible public record that documents the solicitation. (c)After the date set for receipt of proposals,a register of proposals shall be prepared.The register must include the name of each offerer and a description of the supply,service,or construction item offered.The procurement officer shall open the register of proposals and all the contents of all proposals for public inspection when the procurement officer issues a notice of intent to award. (d)The procurement officer shall receive,open,and evaluate proposals so as to avoid disclosure of contents to competing offerers before notice of intent to award a contract is issued. (e)To the extent the offeror designates and the procurement officer concurs,trade secrets and other proprietary data contained in the proposal will not be opened for public inspection under (c)of this section. Exhibit R-2 Page 19 of 40 (f)A proposal or proposal correction received at the place designated for receipt of proposals after the time and date set for receipt of proposals is late. (g)A late proposal or correction may not be opened or considered unless the delay was due to an error of the authority.The procurement officer shall document the date and time the late proposal or correction was received and return the unopened late proposal or correction to the offerer after the protest period has passed. (h)If a solicitation is canceled after proposals are received but before a notice of intent to award a contract has been issued,and if a rotest of the solicitation or of the cancellation of the solicitation has not been filed by an interested party,the procurement officer shall return all proposals to the offerors that submitted proposals once the time specified for filing a protest has expired.The procurement officer shall keep a list of returned proposals in the file for the solicitation. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.370.Evaluation of proposals (a)The procurement officer shall evaluate proposals based on the evaluation criteria and processes identified in the request for proposals.The procurement officer may not use other factors,criteria,or processes. (b)The procurement officer,or a procurement evaluation commiittee consisting of at least the procurement officer and two other authority employees,shall evaluate proposals.Other authority employees,public officials,experts,or representatives of participating organizations may be substituted as appropriate if there is no conflict of interest and the procurement evaluation committee is made up of at least the procurement officer and two employees of the authority or substitutes. (c)If a procurement evaluation committee evaluates the proposals,each member shall exercise independent judgment,and the vote of one member may not be weighted more than the vote of any other member. (d)The procurement evaluation committee may hold meetings to discuss the proposals received. Evaluators may independently adjust their own scores or rankings as a result of these discussions. (e)Numerical rating systems may be used,but are not required.If a numerical rating system is used, evaluators are not required to provide additional documentation for scoring,if the relative weight of the criteria and system is defined in the solicitation. (f)If a numerical rating system is not used,each evaluator shall provide a brief narrative consistent with the evaluation criteria documenting the basis for the evaluator's ranking in writing.. (g)The procurement officer shall document the evaluation process and provide a summaryof the final ranking of proposals for the procurement file. History Exhibit R-2 Page 20 of 40 History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.380.Rejection of individual proposals Reasons for rejecting an individual proposal include one or more of the following: (1)the proposal is nonresponsive to the minimum requirements identified in the solicitation; (2)the offeror submitting the proposal is not responsible as determined under standards set out in 3 AAC 109.280; (3)the offeror submitting the proposal is excluded from submitting a proposal under 3 AAC 109.070; (4)after evaluation and discussion,only one proposal is available for award,and the chief procurement officer determines that proceeding with the award does not satisfy 3 AAC 109.020. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.390.Clarification of offers (a)In order to determine if a proposal is reasonably susceptible for award,communications by the procurement officer or the procurement evaluation committee are permitted with an individual offeror to clarify the contents of an offeror's proposal. (b)Clarification is limited to clarification of ambiguities or conflicts in the proposal and may not be a negotiation or allow for material changes to the proposal being evaluated. (c)The procurement officer may limit communications to only those offerers who submitted proposals requiring clarification in order to complete the evaluation of those proposals. (d)The evaluation by the procurement officer or the procurement evaluation committee may be adjusted as a result of a clarification under this section History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.400.Proposal discussions with offerors and best and final offers (a)At the discretion of the procurement officer,an offerer whose proposal is reasonably susceptible for award as determined in the initial evaluation may be offered the opportunity to confidentially discuss the proposal with the procurement officer or procurement evaluation committee. Exhibit R-2 Page 21 of 40 (b)The opportunity for confidential discussions,if held,must be extended to all offerors submitting proposals determined reasonably susceptible for award. (c)Meetings with offerors under this section are not subject to AS 44.62.310 -44.62.319 (Open Meetings Act). (d)Auction techniques that reveal one offeror's price to another,and disclosure of any information derived from competing proposals,are prohibited. (e)The procurement officer may limit discussions to specific sections of the proposals received or specific sections of the request for proposals. (f)The conditions,terms,or price of the proposal may be altered or otherwise changed during the course of the discussions,if the changes are within the scope of the request for proposals.Any modifications to a proposal as a result of discussions shall be reduced to writing by the offerer within the time frame designated by the procurement officer. (g)Following discussions,the procurement officer may set a date and time for the submission of best and final proposals. (h)Best and final proposals may be submitted more than once if the chief procurement officer makes a written determination that it is in the best interests of the purposes of this chapter to conduct additional discussions or change the requirements and request submission of another round of best and final proposals. (i)If an offerer does not submit a best and final proposal or a notice of withdrawal,the offerer's previous proposal is considered the offerer's best and final proposal for the purpose of evaluation and award. (j)The evaluation of a proposal may be adjusted as a result of discussions under this section. (k)After best and final proposals are received,final evaluations will be conducted as described in 3 AAC 109.370 (evaluation of proposals). History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.410.Contract negotiations (a)After evaluation of proposals including an adjustment of an evaluation of a proposal,the procurement officer may negotiate with the offerer of the highest ranked proposal for the purpose of obtaining contract terms consistent with the solicitation and most favorable to the grantee. (b)The procurement officer may request or the offerer may propose changes to the offerer's proposal during contract negotiations.The changes must be reasonable and may not have the effect of substantially changing the scope of work or price if the change would alter the ranking of the highest ranked proposal.All changes will be documented in writing and incorporated into the contract documents. Exhibit R-2 Page 22 of 40 (c)If the offeror with the highest ranked proposal fails to negotiate in good faith,fails to negotiate within the time period set by the procurement officer,or is unable to adjust the price as may be required by the procurement officer without materially affecting the scope of work,the procurement officer may terminate negotiations and begin contract negotiations with the offeror of the next highest ranked proposal in the manner prescribed in this section. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.420.Contract award The procurement officer shall award a contract under competitive sealed proposals to the responsible and responsive offeror whose proposal is determined in writing to be the most advantageous to the grantee,taking into consideration the evaluation factors set out in the request for proposals and any contract negotiations. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.430.Documentation of contractor selection When a contractor has been selected by competitive sealed proposal,the procurement officer shall enter into the procurement file a written record of the basis on which the selection was found to be most advantageous to the purposes of this chapter. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.440.Notice of intent to award Notice of intent to award shall be issued in accordance with 3 AAC 109.330. History History:Eff.7/10/2015,Register 215 Exhibit R-2 Page 23 of 40 Annotations Authority:AS 44.83.080 Article 5 Other Procurement Methods Section 450.Determinations to use other procurement methods. 460.Small procurements. 470.Limited competition procurements. 490.Non-competitive procurements. 500.Innovative procurements. 3 AAC 109.450.Determinations to use other procurement methods The procurement officer responsible for making a determination to conduct a non-competitive procurement,limited competition procurement,or an innovative procurement shall examine the material facts of the procurement and independently determine whether the procurement is eligible for the procurement method contemplated. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.460.Small procurements (a)Procurement requirements may not be artificially divided or fragmented so as to constitute a purchase under this section or to circumvent the source selection procedures required under 3 AAC 109.210 -3 AAC 109.330 or 3 AAC 109.340 -3 AAC 109.440. (b)The procurement officer shall use reasonable and adequate procedures,and make records that facilitate auditing of the procurement,when procuring supplies,services,professional services,or construction estimated to cost not more than $5,000. (c)The procurement officer shall use the following procedures in the procurement of supplies,services, professional services,or construction estimated to cost more than $5,000,but not more than $25,000: (1)for the solicitation, (A)at least three firms or persons shall be contacted for a quotation or informal proposal;and (B)the solicitation may be made verbally or in writing;in the solicitation,the procurement officer shall include the specifications,the award criteria,and the date and time responses are due; (2)for the award,the procurement officer shall make the award (A)in accordance with the specifications and award criteria in the solicitation;and (B)to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the grantee; Exhibit R-2 Page 24 of 40 (3)as part of the file on the procurement,the procurement officer shall include the (A)name of the person who made the solicitation and the date of the solicitation; (B)information provided by the procurement officer under (1)(B)of this subsection; (C)names of the firms or persons contacted,a summary of any verbal responses,and copies of all quotations or informal proposals received;and (D)justification for the award. (d)The procurement officer shall use the following procedures for the procurement of supplies, services,professional services,or construction estimated to cost more than $25,000,but not more than $100,000: (1)for the solicitation, (A)at least three firms or persons shall be contacted for a quotation or an informal proposal; (B)the solicitation shall be made in writing;in the solicitation,the procurement officer shall include the specifications,the award criteria,the requirement that the response be made in writing,and the date and time responses are due; (2)for the award,the procurement officer shall (A)make the award {i)in accordance with the specifications and award criteria in the solicitation;and (ii)to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the grantee;and (B)provide written notice of the award,including the name of the successful offeror,to each firm or person providing a quotation or informal proposal,and will describe protest rights under 3 AAC 109.580 and the time limitations within which a protest must be received; (3)as part of the file on the procurement,the procurement officer shall include (A)a copy of the solicitation made under (1){B)of this subsection; (B)the names of the firms or persons contacted and copies of all written quotations or informal proposals received;and (C)documentation of and the justification for the award. (e)Nothing in this section prevents postings in electronic media to satisfy the competitive solicitation and notice of award requirements.Quotes and informal proposals may be submitted in electronic media if permitted by the procurement officer. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.470.Limited competition procurements (a)A contract may be awarded under this section when the chief procurement officer determines in writing that a situation exists that makes competitive sealed bidding or competitive sealed proposals impractical or contrary to the interests of the grantee. Exhibit R-2 Page 25 of 40 (b)Situations that may justify conducting a limited competition procurement include (1)procurements that cannot be publicly advertised without compromising the interests of the grantee or authority; (2)procurements that may have been previously solicited by competitive sealed proposals or competitive sealed bids but the procurement officer was unable to award because no responsible and responsive bids or proposals were received and the grantee still has an immediate need for the goods or services. (c)To determine if two or more sources are interested in a procurement,the procurement officer may provide notice under 3 AAC 109.150 requesting letters of interest in a limited competition procurement. (d)Solicitation under this section may be limited to two or more potential contractors that the chief procurement officer determines may be able to provide a response to the solicitation. (e)Under this section the procurement officer shall solicit bids or proposals and conduct negotiations, as appropriate,as to price,delivery,and terms,equally with each potential contractor. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.490.Non-competitive procurements (a)A procurement officer may contract for supplies,services,professional services,or construction without the use of competitive source selection (1)for any contract issued by another state or federal government agency where the authority is authorized to place orders under the terms and conditions of that contract; (2)for a contract where the total cost is not more than $5,000 and the price is fair and reasonable; (3)for a contract that was previously competitively bid,but where only one nonresponsive bid was received and the chief procurement officer determines that negotiation with that bidder is in the grantee's best interest because. (A)an immediate need exists for the goods or services;or (B)re-solicitation is unlikely to increase the number of bids; (4)for a contract where time is of the essence and the chief procurement officer makes a determination that the non-competitive procurement is in the grantee's best interest because (A)the time required to solicit competitive bids or proposals for the equipment or services would adversely impact the grantee's project; (B)the price for goods or services is reasonable compared to the impacts of a delay; (C)the proposed contractor is in a unique position to be able to meet the grantee's needs;and (D)the duration of the contract is limited;or (5)for a contract where the chief procurement officer determines that award of a contract by competitive sealed bidding,competitive sealed proposals,or small procurement procedures is not practicable,and that award to a single source is in the grantee's best interests as no other reasonable Exhibit R-2 Page 26 of 40 source of the supplies or services is available that could meet the requirements and schedule;the procurement officer may advertise its intent to make a single source award to determine if a single source award is appropriate. (b)For procurements made under (a)(3),(4)and (5)of this section,the chief procurement officer's determination must be in writing and include a written explanation with evidence necessary for the independent examination and determination of the material facts of the procurement.The determination by the chief procurement officer that a specific course of action is or is not "in the grantee's best interest"means a determination that is reasonable under the circumstances and is not arbitrary,capricious,or prompted by corruption.A request to use a non-competitive procurement method that is based on a determination that it is "in the grantee's best interest”must cite the specific and significant interests to support use of the non-competitive procurement method. (c)A procurement officer shall conduct negotiations,as appropriate,as to the price,delivery,and terms of a non-competitive procurement identified in (a)(3),(4),and (5)of this section,and the contractor shall provide cost and pricing data in accordance with 3 AAC 109.560. (d)The determination required for procurements under (a)(3),(4),and (5)of this section may only be made by the chief procurement officer or the executive director in the absence of the chief procurement officer. (e}The procurement file must include a copy of the determinations for procurements made under (a)(3),(4),and (5)of this section. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.500.Innovative procurements (a)A contract may be awarded for supplies,services,professional services,or construction using an innovative procurement process,with or without competitive sealed bidding or competitive sealed proposals,when the chief procurement officer determines in writing that it satisfies 3 AAC 109.020 to use an innovative competitive procurement process in the procurement of new or unique requirements of the grantee or authority,new technologies,or to achieve best value. (b)The chief procurement officer shall submit a procurement plan to the attorney general for review and approval as to form before issuing the notice required by (c)of this section.The plan must,at a minimum,address the method of solicitation,scope,method of award,protest procedures,and proposed contract provisions. (c})A procurement under this section is subject to public notice requirements of 3 AAC 109.150. (d)A record of an innovative procurement must be available for public inspection upon completion or cancellation of the procurement,and must contain (1)a copy of the contract; Exhibit R-2 Page 27 of 40 (2)the written determination of the chief procurement officer to use the innovative procurement procedure; (3)the procurement plan as approved as to form by the attorney general; (4)the record of notice as required under 3 AAC 109.150; (5)the record of respondents to the solicitation;and (6)the contract award. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 6 Contract Formation and Modification Section 510.Type of contracts. 520.Contract contents. 530.Contract term and cancellation. 540.Contract amendments. 550.Standard contract clauses. 560.Cost principles and contractor cost and pricing data. 3 AAC 109.510.Type of contracts Any type of contract that will promote the best interests of the grantee may be used,except that the use of a cost-plus-a-percentage-of-cost contract is prohibited History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.520.Contract contents (a)Each contract awarded as a result of competitive sealed bids or competitive sealed proposals must contain (1)a statement of the amount of the contract; (2)the date for the supplies to be delivered or the expected period of performance of the construction, services,or professional services; (3)a description of the supplies,construction,services,or professional services to be provided;and Exhibit R-2 Page 28 of 40 (4)certification by the procurement officer or other official of the authority that sufficient money is available to be encumbered to cover the obligation under the contract or will be available before the procurement officer issues a notice to proceed or purchase order against the contract. (b})The procurement officer may also incorporate clauses for adjustments in prices,period of performance,and scope in addition to other terms or requirements included in the solicitation or negotiated between the procurement officer and the contractor. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.530.Contract term and cancellation (a)Unless otherwise provided by law,a contract for supplies,services,or professional services may be entered into for any period of time considered to be in the best interests of the grantee or authority,if the term of the contract and conditions of renewal or extension,if any,are included in the solicitation and funds are available for the first grant period at the time of contracting. (b)Payment and performance obligations for succeeding grant periods shall be subject to the availability and designation of funds for purposes of the contract. (c)Before using a multi-term contract,the procurement officer shall determine in writing that (1)estimated requirements cover the period of the contract and are reasonably firm and continuing; and (2)the contract will serve the best interests of the grantee or authority by encouraging effective competition and efficient contract administration. (d)When funds are not appropriated or otherwise made available to support continuation of performance in a subsequent fiscal period,the contract shall be canceled. (e)Upon cancellation,the contractor may only be reimbursed for the reasonable value of any nonrecurring costs incurred but not amortized in the price of the supplies,services,or professional services delivered under the contract that are not otherwise recoverable. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.540.Contract amendments Exhibit R-2 Page 29 of 40 (a)The procurement officer may amend a contract or purchase order if the contract includes clauses or terms that allow for and anticipate change orders,additional work,changes in scope,price adjustments, follow-up phases of work,or renewals consistent with the original scope and estimates of term and price documented with the source selection method used in the award. (b)The procurement officer may amend a contract or purchase order when there is an unanticipated change in work beyond the estimated or actual contract price,term,or scope,if (1)the solicitation was conducted following the small procurement procedures under 3 AAC 109.460, the amendment or change order,or cumulative contract amendments or change orders,will not cause the total contract amount,as amended,to exceed by 50 percent or more the original contract price,and the new total price of the contract,including all change orders and amendments,does not exceed the dollar limit for small procurements under 3 AAC 109.460;or (2)the original contract is greater than $100,000,and the amount ofthe unanticipated amendment or change order,or cumulative unanticipated contract amendments or change orders,will be less than 20 percent of the original contract amount,including any anticipated amendments or contract adjustments. (c)Before issuing an amendment that exceeds the dollar limits in (b)(1)or (2)of this section,the chief procurement officer shall provide a written determination required under 3 AAC 109.490(a}(4)or (5). (d)The procurement officer shall obtain cost and pricing data in accordance with 3 AAC 109.560 from the contractor to confirm the price adjustment is fair and reasonable.The authority's controller,or the controller's designee,must certify that there are sufficient funds to pay for any increase in price before issuing an amendment. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.550.Standard contract clauses (a)The chief procurement officer,in consultation with the attorney general,may establish standard contract clauses that provide for appropriate remedies and cover the following subjects: (1)liquidated damages; (2)order of precedence of contract documents; (3)specified excuses for delay or nonperformance; (4)termination of the contract for default; (5)termination of the contract in whole or in part for the convenience of the grantee or authority; (6)adjustments in time including renewals or extensions; (7)dispute resolution; (8)adjustments in price; (9)changes in work; (10)additional work; Exhibit R-2 Page 30 of 40 (11)amendments. (b)The standard clauses to be used in a contract will be identified in a separate appendix to the contract and referenced in the solicitation. (c)A procurement officer may vary the standard clauses for inclusion in a particular contract if (1)the variations and the circumstances justifying them are documented;and (2)the procurement officer receives written approval of the attorney general as to form. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.560.Cost principles and contractor cost and pricing data (a)Before an award of a non-competitive contract or a change order or contract modification,the contractor or prospective contractor shall submit cost and pricing data.The contractor or prospective contractor shall certify that,to the best of the contractor's or prospective contractor's knowledge and belief,the data submitted is accurate,complete,and current as of a mutually determined specified date and will continue to be accurate and complete during the performance of the contract. (b)When a contractor becomes aware of a situation that may form the basis of a claim for compensation that exceeds the amount designated as the base amount of the contract and before performing additional work or supplying additional materials,the contractor shall submit cost and pricing data on the additional work or materials.The contractor shall certify that,to the best of the contractor's knowledge and belief,the data submitted is accurate,complete,and current and is the actual cost to the contractor of performing the additional work or supplying the additional materials. (c)Acontract,change order,or contract modification under which a certification is required under (a) or (b)of this section must contain a provision that the contract price,including the contractor's profit or fee,will be adjusted to exclude any significant sums by which the procurement officer finds that the price is increased because the cost or pricing data furnished by the contractor or prospective contractor is inaccurate,incomplete,or not current as of the date agreed upon by the parties; (d)The requirements of (a)of this section do not apply when (1)the contract price is based on adequate price competition obtained through a competitive solicitation; (2)the contract price is set by law or regulation;or (3)the chief procurement officer determines in writing that the requirements of (a)of this section may be waived and the reasons for waiver are stated. (e)The procurement officer may use the federal cost principles a guidance in contract negotiations. History History:Eff.7/10/2015,Register 215 Exhibit R-2 Page 31 of 40 Annotations Authority:AS 44.83.080 Article 7 Legal and Contractual Remedies Section 570.Applicability of procurement protest and appeal procedures. 580.Protest of small procurement. 590.Contract claims. 600.Misrepresentations,fraud,and attempted fraud. 610.Debarment. 3 AAC 109.570.Applicability of procurement protest and appeal procedures (a)Except for protests of small procurements made under 3 AAC 109.580,the provisions of AS 36.30.560 -36.30.615 apply to the protest or appeal of a protest on a solicitation,a proposed contract award,or the award of a contract for supplies,services,professional services,or construction.In applying the provisions of AS 36.30.560 -36.30.615 under this chapter, (1)the rights,powers,and duties relating to appeals of protests concerning the procurement of supplies,services,professional services,or construction duties under AS 36.30 assigned to any commissioner is vested in the executive director with respect to appeals of protests,and the executive director may delegate the rights powers,and duties to the chief procurement officer; (2)the chief procurement officer is responsible for taking all necessary actions following the procedures in AS 36.30.610 and 36.30.615 to develop a recommendation regarding a protest appeal; (3)the chief procurement officer may request,as provided under AS 44.64.030(b),that the office of administrative hearings (AS 44.64.010)conduct a hearing on an appeal in accordance with AS 36.30.670, make findings of fact and conclusions of law,and provide a recommended decision for the chief procurement officer to furnish to the executive director; (4)the chief procurement officer shall make a recommendation to the executive director for a final decision on protest appeals not subject to 3 AAC 109.580;the executive director retains the final decision-making authority on a protest appeal and may affirm,modify,or reject the recommended decision,in whole or in part,may remand to the chief procurement officer or any hearing officer or administrative law judge with instructions,or may take other appropriate action. (b)Protest of procurements with a total award value of $100,000 or less must be made under 3 AAC 109.580. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Exhibit R-2 Page 32 of 40 3 AAC 109.580.Protest of small procurement (a)An interested party shall attempt to informally resolve any protest with the procurement officer regarding a procurement with a total award value of $100,000 or less.If the attempt is unsuccessful,the interested party may protest the solicitation or the award of a small procurement contract solicited or awarded under 3 AAC 109.460.The protest must be filed with the executive director.The protester must file a copy of the protest with the procurement officer. (b)If protesting a solicitation issued under 3 AAC 109.460,a protest must be filed before the date and time that quotations or informal proposals are due to the authority. (c)If protesting the award of a small procurement contract of not more than $25,000,the protest must be filed not later than 10 days after the date of the solicitation or award,whichever is later. (d)If protesting the award of a small procurement contract greater than $25,000,a protest must be filed not later than 10 days after the date that notice of award is made. (e)To be accepted by the authority,a protest filed under (a),(b),(c),or (d)of this section must contain (1)the name,address,and telephone number ofthe protester; (2)the signature of the protester or the protester's representative; (3)identification of the solicitation or contract at issue; (4)a detailed statement of the legal and factual grounds ofthe protest,including copies of relevant documents;and (5)the form of relief requested. (f)The procurement officer shall immediately give notice of the protest to the contractor or,if no award has been made,to all firms or persons that were solicited for the small procurement. (g)The executive director or the executive director's designee may (1)with the concurrence ofthe protester,assign the protest to the chief procurement officer or other responsible state official for a final administrative resolution under alternate dispute resolution; (2)conduct a hearing on the protest consistent with the procedures set out in 3 AAC 109.570(a)(3);or (3)issue a final decision under (h)of this section. (h)The executive director or the executive director's designee shall (1)issue a final decision denying the protest and stating the reasons for denial; (2)issue a final decision that sustains the protest,in whole or in part,and instruct the procurement officer to implement an appropriate remedy;or (3)remand to the chief procurement officer or any hearing officer or administrative law judge with instructions. (i)The final decision of the executive director or the executive director's designee under (h)of this section constitutes the final action of the authority on the protest. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Exhibit R-2 Page 33 of 40 3 AAC 109.590.Contract claims (a)The provisions of AS 36.30.620 -36.30.631 apply to any contract claim concerning a contract awarded by the procurement officer under this chapter. (b)Hearings on contract claims will be conducted in accordance with AS 36.30.670 -36.30.685,and any arbitration of a construction contract will be conducted in accordance with 2 AAC 12.950 -2 AAC 12.989. (c)The rights,powers,and duties relating to appeals of claims and arbitration of construction contracts concerning the procurement of supplies,services,professional services,or construction that are assigned under AS.36.30 to any commissioner are vested under this chapter with the executive director. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.600.Misrepresentations,fraud,and attempted fraud (a)A person who makes or uses a misrepresentation in support of a contract claim under this chapter, or who practices or attempts to practice a fraud,at any stage of proceedings relating to a procurement or contract claim under this chapter (1)forfeits all claims relating to that procurement or contract;and (2)is obligated to reimburse all sums paid on the claim and for all costs attributable to review of the claim. {b)The procurement officer or executive director shall make specific findings of misrepresentation, attempted fraud,or fraud before declaring a forfeiture under (a)(1)of this section. (c)Upon a finding that the recipient of a contract issued under this chapter made a misrepresentation or fraudulent claim at any stage of proceedings relating to a procurement or contract controversy,the procurement officer may,after consulting with the attorney general,declare the contract void. (d)In this section,"misrepresentation"means a false or misleading statement of material fact,or conduct intended to deceive or mislead concerning material fact,whether it succeeds in deceiving or misleading. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.610.Debarment Exhibit R-2 Page 34 of 40 (a)The provisions of AS 36.30.635 -36.30.665 and 2 AAC 12.630 -2 AAC 12.670 apply to any debarment action undertaken by the authority against a contractor to prohibit a contractor from participating in any solicitation or award under this chapter. (b)Hearings on a debarment action will be conducted in accordance with AS 36.30.650 and 2 AAC 12.650 -2 AAC 12.670. (c)The rights,powers and duties relating to debarment actions assigned to the commissioner of administration under AS 36.30 are vested with the executive director with respect to any debarment actions undertaken by the authority under this chapter. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 8 Additional Principles and Administrative Provisions Section 650.Supplementary general principles of law applicable. 660.Requirement of good faith. 680.Public access to procurement records. 690.Retention of procurement records. 700.Procurement records for competitive sealed bids and proposals. 710.Procurement records for other procurements. 3 AAC 109.650.Supplementary general principles of law applicable Unless displaced by the particular provisions of this chapter,the principles of law and equity,including AS 45.01 -AS 45.08,AS 45.12,AS 45.14,and AS 45.29 (Uniform Commercial Code),the law merchant, and law relative to capacity to contract,agency,fraud,misrepresentation,duress,coercion,mistake,or bankruptcy supplement the provisions of this chapter. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.660.Requirement of good faith Exhibit R-2 Page 35 of 40 All parties involved in the negotiation,performance,or administration of contracts of the authority under this chapter shall act in good faith. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.680.Public access to procurement records (a)Procurement records under this chapter are public records in accordance with AS 40.25.110. (b)If a bidder or proposer submits a procurement record and request that it be kept confidential,the chief procurement officer shall determine whether the procurement record appears to be confidential and notify the bidder or proposer of the determination.If the authority receives a public records request for a procurement record determined to appear to be confidential,the authority will notify the bidder or proposer of the public records request to enable the bidder or proposer to protect the confidentiality of the procurement record. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.690.Retention of procurement records Procurement records shall be retained and disposed of in accordance with records retention guidelines and schedules approved by the state archivist. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.700.Procurement records for competitive sealed bids and proposals The executive director shall keep a contract file open for public inspection for each contract awarded under competitive sealed bids and competitive sealed proposals.The file may be maintained ina reproducible electronic format and must contain (1)a copy ofthe solicitation document; (2)a register of bids or proposals received; (3)a copy of each responsive bid or proposal received; (4)the basis of award;and Exhibit R-2 Page 36 of 40 (5)a copy of the contract that includes a description of the supplies,services,professional services,or construction procured under each contract. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 3 AAC 109.710.Procurement records for other procurements The executive director shall keep a contract file open for public inspection for each limited competition procurement,innovation procurement,or non-competitive procurement under 3 AAC 109.490(a}{3),(4), and (5).The file may be maintained in a reproducible electronic format and must contain (1)the determination,as required,regarding the source selection method used; (2)for innovative procurements,the procurement plan approved by the attorney general; (3)if the procurement is solicited, (A)a copy of the solicitation document used; (B)a copy of the notice posted or list of potential offerors contacted; (C)a register of offers or proposals received; (D)a copy of each responsive offer or proposal received;and (E)the basis of award; (4)if the procurement is not solicited, (A)cost and pricing data;and (B)a copy of the quote,offer,or proposal received if different from the final contract;and (5)a copy of the contract that includes a description of the supplies,services,professional services,or construction procured under each contract. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Article 9 General Provisions Section 900.Definitions. 3 AAC 109.900.Definitions In this chapter unless the context requires otherwise, (1)"authority"means the Alaska Energy Authority; (2)"Alaska business license”means a license required under AS 43.70 (Alaska Business Act); Exhibit R-2 Page 37 of 40 (3)"Alaska Online Public Notice System"means the system developed under AS 44.62.175; (4)"alternate dispute resolution”means negotiation or mediation voluntarily used to resolve issues in controversy; (5)"change order"means a written order signed by the procurement officer directing the contractor to make changes that the changes clause of the contract authorizes the procurement officer to order without the consent of the contractor; (6)"chief procurement officer"means the person appointed by the executive director under 3 AAC 109.030(c)(1)as the chief procurement officer of the authority; (7)"competitive sealed bidding"means the procedure under 3 AAC 109.210 -3 AAC 109.330; (8)"competitive sealed proposals"means the procedure under 3 AAC 109.340 -3 AAC 109.440; (9)"construction”means (A)the process of building,altering,repairing,maintaining,improving,or demolishing a highway, structure,building,or other improvement of any kind to real property; (B)includes services and professional services relating to planning and design required for the construction; (C)does not include the routine operation of an improvement to real property; (10)"contract"means all types of agreements,regardless of what they may be called,for the procurement or disposal of supplies,services,professional services,or construction; (11)"contract modification"means a written alteration in specifications,delivery point,rate of delivery, period of performance,price,quantity,or other provisions of a contract accomplished by mutual action of the parties to the contract; (12)"cost and pricing data"means information concerning the actual or estimated cost of labor, material,overhead,and other cost elements that have been actually incurred or that are expected to be incurred by the contractor in performing the contract; (13)"design-build construction contract"means a construction contract between the authority and a design-builder to furnish architecture,engineering,and related design services,and to furnish construction services,including labor and materials; (14)"executive director"means the executive director of the authority; (15)"grantee"means any entity that receives a grant of money or property under which the authority manages the grant on behalf of the entity, (16)"grant"means property furnished by the state,whether real or personal,designated by law, including an appropriation act,as a grant; (17)"interested party”means an actual or prospective bidder or offeror whose economic interest might be affected substantially and directly by the issuance of a contract solicitation,the award of a contract, or the failure to award a contract; (18)"minor informality" (A)means a matter of form rather than substance that {i)is evident from the bid document,or is an insignificant matter that has a negligible effect on price, quantity,quality,delivery,or contractual conditions;and (ii)can be waived or corrected without prejudice to other bidders; Exhibit R-2 Page 38 of 40 (8B)includes typographical errors,errors in extending unit prices,transposition errors,and arithmetical errors that are evident from the bid document; (19)"nonresponsive"means a bid or proposal that does not conform in all material respects to the solicitation; (20)"person"means a business,individual,union,committee,club,other organization,or group of individuals; (21)"procurement" (A)means buying,purchasing,renting,leasing,or otherwise acquiring supplies,equipment,services,or construction for the authority; (B)includes functions that pertain to the obtaining of supplies,equipment,services,or construction, including description of requirements,selection and solicitation of sources,preparation and award of contract,and all phases of contract administration; (22)"procurement officer" (A)means a person authorized to enter into and administer contracts for the authority and make written determinations with respect to them; (B)includes an authorized representative of a procurement officer acting within the limits of the delegated authority; (23)"professional services"means professional,technical,or consultant's services that are predominantly intellectual in character,result in the production of a report or the completion of a task, and include analysis,evaluation,prediction,planning,or recommendation; (24)"protester"means an actual or prospective bidder,offeror,or contractor who is aggrieved in connection with the solicitation or the award of a contract and who files a protest; (25)"reasonable and adequate procedures" (A)means procedures that ensure fairness to potential offerors and competition commensurate with the circumstances of the procurement,considering price,mission requirements,and available competition; (B)includes contacting only one potential offeror in appropriate circumstances; (26)"responsive bidder"means a firm or person who has submitted a bid that conforms in all material respects to the solicitation; (27)"services" (A)means the furnishing of labor,time,or effort by a contractor,not involving the delivery of a specific end product other than reports that are merely incidental to the required performance; (B)does not include employment agreements or collective bargaining agreements; (28)"solicitation"means an invitation to bid,a request for proposals,a request for quotations,or any other method of soliciting bids,proposals,or quotes to perform a contract with the authority; (29)"specification"means a description of the physical or functional characteristics,or of the nature of a supply,service,professional service,or construction project;it may include requirements for licensing, inspecting,testing,and delivery; (30)"supplies" {A)means all property of the authority,including equipment,materials,and insurance; (B)includes privately owned real property leased for the authority's use,such as office space; Exhibit R-2 Page 39 of 40 (C)does not include the acquisition or disposition of other interests in land. History History:Eff.7/10/2015,Register 215 Annotations Authority:AS 44.83.080 Exhibit R-2 Page 40 of 40 Exhibit R-3 Chapter 106 Loan Programs Article 1.Loan From Power Project Fund.(3 AAC 106.100 -3 AAC 106.159) 2.Loans From Rural Electrification Revolving Loan Fund.(3 AAC 106.200 -3 AAC 106.269) 3.Loans From Bulk Fuel Revolving Loan Fund.(3 AAC 106.300 -3 AAC 106.365) 4.General Provisions.(3 AAC 106.900 -3 AAC 106.900) Annotations Editor's note:As a Register 151 (October 1999),the provisions of former 19 AAC 96 were relocated by the regulations attorney under AS 44.62.125(b)(6)to 3 AAC 106 in accordance with ch.58,SLA 1999. Article 1 Loan From Power Project Fund Section 100.Power project fund loan application. 110.Review by authority. 120.Terms of loans. 125.Criteria to establish financial feasibility. 130.Inspection of records and facilities. 140.Loans from other appropriations. 150.Loan fees and reimbursement of costs. 159.Definition. 3 AAC 106.100.Power project fund loan application (a)An applicant for a loan from the power project fund must submit an application to the authority.The application must contain at the time of submission the following information: (1)the legal name ofthe applicant and the legal authority under which it was created and other information that will demonstrate that the applicant is an eligible borrower under AS 42.45.010; (2)a certified copy of the resolution or other official action taken by the applicant's governing body authorizing the application for a loan; (3)the name,title,and address of the applicant's official correspondent or representative for purposes of the application; (4)the names and titles of the applicant's principal officers,including the chief executive officer or general manager; (5)the names and addresses of the engineer,legal counsel,financial advisor or consultant,and any management,engineering,design,economic,or other advisors or consultants that the applicant has for the project; Exhibit R-3 Page 1 of 18 (6)the terms requested for the loan,including the total dollar amount of the loan,the maximum time allowed for repayment,and whether the applicant requests a reduced interest rate under (c)of this section; (7)a general description of the use to which the loan money will be applied,including (A)the geographic location of the project; (B)a comprehensive statement clearly demonstrating public need for the project and the project's eligibility under AS 42.45.010; (C)the proposed allocation of loan money to each purpose or to each phase of a project;and (D)a narrative section providing a detailed description of the project,including each purpose of the project,a timeline and description of project phases,and the estimated annual operating costs and revenues of the project once project operations begin; (8)information from which the authority can determine (A)in the case of a loan to construct,equip,modify,or expand a project,whether the project is technically and economically viable,and is financially feasible under the criteria for financial feasibility in 3 AAC 106.125(a);and (B)whether the applicant has the financial ability including,if necessary,the authority to charge and collect rates,fees,or rentals or in the case of a municipality,to levy taxes to generate sufficient revenue to repay the loan; (9)the status of any proceedings undertaken by the applicant to obtain permits,certificates or other authorizations from any federal,state,or local agency necessary to begin,complete,and operate the project; (10)financial statements for the previous two complete fiscal or calendar years of the applicant and any other party or parties acting as guarantor of the loan,unless otherwise required by the authority;these financial statements must include balance sheets and profit-and-loss statements and when possible, must be certified by an independent certified public accountant; (11)for an investor-owned electric utility,a business history of any person or entity owning or controlling 10 percent or more of the applicant's stock or business; (12)for a leveraged lease financing arrangement,information sufficient for the authority to determine that the provisions of AS 42.45.010(b)(2)have been met;and (13)if the applicant is a Native village council,a resolution waiving sovereign immunity on a form provided by the authority. (b)An applicant shall,in addition to the application,timely provide other information requested by the authority. (c)Repealed 4/8/2015. (d)An applicant requesting an interest rate less than the rate set out in AS 42.45.010(f)(2)(A)must provide information sufficient for the authority to determine that the reduced rate is necessary to allow the project to meet the criteria for financial feasibility under 3 AAC 106.125(b). History History:Eff.2/16/96,Register 137;am 4/8/2015,Register 214 Exhibit R-3 Page 2 of 18 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.100 was set out in former 3 AAC 94.070.The history note of 19 AAC 96.100 does not reflect the history of 3 AAC 94.070. 3 AAC 106.110.Review by authority (a)Upon receipt of a completed application and other information requested or required,the authority will review the application. (b)The authority after reviewing an application,other than an application for a loan for reconnaissance studies,feasibility studies,license and permit applications,or engineering and design,will make a determination that includes the following: (1)written comments analyzing whether (A)the money will be used to pay the costs of activities that are eligible under AS 42.45.010 and the applicant is an eligible borrower under AS 42.45.010; (B)the project will meet the needs of the area to be served by the project and will benefit the area; (C)for a loan to construct,equip,modify,or expand a project,the project is (i)technically and economically viable;and (ii)financially feasible under the criteria in 3 AAC 106.125(a},or will become financially feasible with the assistance of a power project loan; (D)for a construction project,any alternatives to the project exist that (i)would result in development of power at a different site,by a different method,or by an entity other than the applicant (ii)could reasonably be expected to provide,within a time schedule comparable to the project, comparable volumes of power at a lower cost to the consumer;and (iii)meet the criteria set out in (B)and (C)of this paragraph; (E)the applicant has applied for,or has been awarded,necessary permits or certificates; (F)for a loan to construct,equip,modify,or expand a project,if enough money is not available in the power project fund to make a loan for the project,or if a loan cannot be made at a rate of interest low enough to allow the project to be financially feasible under the criteria in 3 AAC 106.125(b),the loan should be approved if assistance is made to the applicant from some other source identified by the authority; (G)if there is power project fund money that the authority can loan for more than one project,the needs of,and benefits to,the area to be served by the project are greater than the needs of,and benefits offered to,other areas of the state by a project for which sponsors may also seek loan money from the authority,if this determination can be made based on information existing at the time of the authority's review; (H)the applicant has,or will have,sufficient revenue from all sources to repay the loan;and (2)a list of subjects to be analyzed in any studies to be made by the applicant. (c)The authority will consider each application for a loan for reconnaissance studies,feasibility studies, license and permit applications,engineering and design that has been transmitted to it for action and Exhibit R-3 Page 3 of 18 will determine whether the applicant is an eligible borrower under AS 42.45.010,whether the loan will be used to pay the costs of activities that are eligible under AS 42.45.010,and whether the applicant can reasonably be expected to have sufficient revenue from all sources to timely repay the loan. (d)A loan committee comprised of authority staff designated by the executive director of the authority shall make the final decision of the authority on applications for loans up to and including $2,000,000. For loans in excess of $2,000,000,the board of directors of the authority,upon recommendation by the loan committee,will make the final decision of the authority on applications for loans,except for loans that require legislative approval under AS 42.45.010(j).The final decision of the authority to approve or deny an application for a loan will be in the form of a written determination that contains the findings required by this section,and any other comments the authority considers appropriate.The authority will transmit a copy of the written determination to the applicant not later than 30 days after making its final decision. (e)If the authority approves an application,the written determination will also include (1)any conditions that the applicant must satisfy before the authority will make the loan to the applicant;and (2)proposed loan terms. (f)If the authority approves an application,and after approval of the loan by the legislature to the extent required under AS 42.45.010(j),the authority will enter into a loan agreement with the applicant under conditions complying with 3 AAC 106.120,but only after receiving a certified copy of the resolution or other official action taken by the applicant's governing body agreeing to the terms of the loan. . (g)It is the responsibility of the applicant and not of the authority to obtain the approval by the legislature if approval of the applicant's loan is required under AS 42.45.010({j). (h)!f the authority denies an application,the written determination will also include a statement explaining the reasons for the denial. History History:Eff.2/16/96,Register 137;am 3/25/2005,Register 173;am 4/8/2015,Register 214 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.110 was set out in former 3 AAC 94.080 and 3 AAC 94.090.The history note of 19 AAC 96.110 does not reflect the history of 3 AAC 94.080 and 3 AAC 94.090. 3 AAC 106.120.Terms of loans (a)The terms of a loan made by the authority from the power project fund will be determined by the authority and will comply with the following conditions: Exhibit R-3 Page 4 of 18 (1)the loan must bear interest at the rate determined under AS 42.45.010(f}(2)(A),unless the authority determines,based on information the applicant provides under 3 AAC 106.100(d),that a lower interest rate will allow a project to meet the criteria for financial feasibility under 3 AAC 106.125(b); (2)the loan must mature on the date and pay interest on the dates and in the amounts determined by the authority,but the final maturity date may not extend beyond 50 years or the expected and specified productive life of the project being financed,whichever is less;the authority will use the following standards to determine the length of the loan,taking into consideration the expected productive life of a project unless the authority determines that a different expected productive life is indicated: (A)the term of loans will be up to 20 years for reconnaissance studies and for feasibility studies, preconstruction engineering and project design,or constructing,equipping,modifying,improving,and expanding of {i)diesel generation facilities; (ii)wind,geothermal,and waste heat recovery facilities; (iii)wood gasification; (iv)wood-fired steam-generation facilities; (v)bulk fuel storage facilities; (vi)energy efficiency and conservation projects; (vii)solar thermal,solar photovoltaic hydrokinetic,energy storage,and transmission facilities;and (viii)alternative energy facilities; (B)the term of loans will be up to 50 years for feasibility studies,preconstruction engineering and project design,or constructing,equipping,modifying,improving,and expanding of (i)coal-fired steam-generation facilities;and (ii)hydroelectric generation facilities;and (3)the loan must be supported by appropriate documentation that may include a loan agreement, bonds,notes,or other documentation,evidencing to the authority's satisfaction that the loan is secured by one or more of the following: (A)a pledge of the revenues of the borrower or the project that may be subordinate to operating and maintenance expenses and certain other expenses of the borrower or the project as specified by the authority; (B)a lien,mortgage,security interest,collateral agreements,or other encumbrance on the project or other assets,rights,or interests of the borrower;or (C)a pledge of the taxing power of the borrower. (b}The requirements of (a)(3)of this section do not apply to a loan to an applicant regulated by the Regulatory Commission of Alaska under AS 42.05 if the applicant has a history of repaying long-term loans and demonstrates to the authority that it has the capacity to repay the loan obtained from the authority. History History:Eff.2/16/96,Register 137;am 10/16/2009,Register 192;am 4/8/2015,Register 214 Exhibit R-3 Page 5 of 18 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.120 was set out in former 3 AAC 94.100.The history note of 19 AAC 96.120 does not reflect the history of 3 AAC 94.100. 3 AAC 106.125.Criteria to establish financial feasibility (a)When making a written determination under 3 AAC 106.110 regarding the financial feasibility of a project,the authority will consider (1)the revenue-generating capability of the project,including the local need for power from the project within any interconnected transmission grid; (2)whether the applicant has,or will have,sufficient revenue from all sources to (A)repay the loan; (B)complete the project;and (C)operate and maintain the project; (3)whether the collateral provided is sufficient to secure repayment of the loan,including whether the loan is secured by a means other than by a pledge or revenues of the project; (4)whether the applicant has obtained regulatory approval for any proposed power sales agreement; (5)the relationship between the estimated user fees or charges upon completion of the project and the estimated user fees or charges if consumers of services provided by the project would have continued to receive services from existing sources;and; (6)the relationship between the estimated user fees or charges upon completion of the project and the present or estimated user fees or charges for similar services in the state; (b)When making a determination under 3 AAC 106.120(a)(1)regarding whether to reduce the interest rate for a loan below the interest rate set out in AS 42.45.010(f}(2)(A),the authority will consider (1)the criteria identified in (a)of this section; (2)for electric power projects,whether and the amount by which the local cost of energy exceeds the weighted average retail residential rate in Anchorage,Fairbanks,and Juneau under AS 42.45.110(c)(2); (3)the financial impact on nonindustrial ratepayers expected to use energy or heat produced by the project; (4)whether the project will provide immediate benefits to support the stability and sustainability of local energy or heat systems,including replacement of failing generation systems;and (S)whether the project will help meet new load demands or diversify the local energy system's energy resource portfolio. History History:Eff.4/8/2015,Register 214 Annotations Authority:AS 42.45.010 AS 44.83.080 Exhibit R-3 Page 6 of 18 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.120 was set out in former 3 AAC 94.100.The history note of 19 AAC 96.120 does not reflect the history of 3 AAC 94.100. 3 AAC 106.130.Inspection of records and facilities (a)An applicant for a loan and a borrower who has an outstanding loan with the authority shall make its books and records,facilities,and its real and personal property of any kind,available for inspection at any reasonable time by the authority,or its agents,after receipt by the applicant or borrower of the authority's written request to inspect. (b)The authority or its agents will,in the discretion of the authority,inspect,after giving reasonable notice,the construction of any project that is financed,in whole or in part,with a loan under this chapter.The inspection does not relieve the borrower from its obligation to comply with applicable codes and ordinances. (c)A borrower that has obtained a loan from the authority shall permit the authority or its agents to inspect its books,records,facilities,and real and personal property for as long as any portion of the loan,including interest,remains outstanding. (d)The authority will,in its discretion,by written request require a borrower who has obtained a loan from the authority to submit (1)at reasonable times to audits or examinations of its books and records by an independent firm of certified public accountants selected by the authority to determine whether the provisions of the loan agreement have been complied with and to pay the cost of those audits or examinations; (2)a sworn statement by a responsible officer of the borrower describing the purposes to which the proceeds ofthe loan have been applied. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.130 was set out in former 3 AAC 94.110.The history note of 19 AAC 96.130 does not reflect the history of 3 AAC 94.110. 3 AAC 106.140.Loans from other appropriations The provisions of 3 AAC 106.100 -3 AAC 106.130 relating to loans from the power project fund apply also to all other loans made by the authority affected by ch.58,SLA 1999 and made from money appropriated for that purpose by the legislature,except loans from the rural electrification revolving loan fund,which are subject to the provisions of 3 AAC 106.200 -3 AAC 106.260 and loans from the bulk fuel revolving loan fund,which are subject to the provisions of 3 AAC 106.300 -3 AAC 106.365. History History:Eff.2/16/96,Register 137 Exhibit R-3 Page 7 of 18 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.140 was set out in former 3 AAC 94.120.The history note of 19 AAC 96.140 does not reflect the history of 3 AAC 94.120. 3 AAC 106.150.Loan fees and reimbursement of costs (a)An applicant for a loan from the power project fund must pay an application fee of (1)$200 for applications requesting loan amounts up to and including $100,000; (2)$1,000 for applications requesting loan amounts of more than $100,000 and not more than $500,000; (3)$2,000 for applications requesting loan amounts of more than $500,000 and not more than $1,000,000;or (4)$5,000 for applications requesting loan amounts of more than $1,000,000. (b)The application fees in (a)of this section are nonrefundable and due at the time an application is filed with the authority. (c)The authority may require the applicant to enter into an agreement obligating the applicant to reimburse the authority for the authority's costs to conduct a feasibility analysis of the loan application or proposed project. (d)If the authority approves an application,the borrower shall pay a closing fee of one percent of the total loan amount at the time of closing.The application fee will be credited toward the closing fee.The authority may add the closing fee to the balance of the loan at loan closing.If the authority entered into an agreement with the applicant for reimbursement of the authority's costs for conducting a feasibility analysis under (c)of this section,the authority may add the cost of the authority's feasibility analysis to the balance of the loan at closing. History History:Eff.4/8/2015,Register 214 Annotations Authority:AS 42.45.010 AS 44.83.080 3 AAC 106.159.Definition In 3 AAC 106.100 -3 AAC 106.159,"financially feasible"means that the authority has determined that enough money is available from all sources to complete the project,and that enough money is estimated to be available in the future to repay any debt incurred in connection with the project,taking into consideration the criteria in 3 AAC 106.125. History History:Eff.4/8/2015,Register 214 Exhibit R-3 Page 8 of 18 Annotations Authority:AS 42.45.010 AS 44.83.080 Article 2 Loans From Rural Electrification Revolving Loan Fund Section 200.Use of loan proceeds. 210.Rural electrification revolving loan fund application. 220.Review by authority. 230.Review by loan advisory committee. 240.Terms of loans. 250.Inspection of records and facilities. 260.Loan amounts. 269.Definition. 3 AAC 106.200.Use of loan proceeds (a)A borrower who receives a loan from the rural electrification revolving loan fund may use the loan only to pay for capital improvements that extend the borrower's transmission and distribution system to customers not previously receiving service from a public utility.A borrower may not use the loan to provide electric power generation or fuel storage facilities,or for reconstruction or upgrade of existing transmission and distribution lines. (b)A borrower who receives a loan from the rural electrification revolving loan fund shall use money available to the borrower,other than the proceeds of the loan,to acquire and install one transformer, one span of line,one pole,and one service drop for each customer to who immediate service is provided.The borrower may use proceeds of the loan to pay for additional costs of providing service to a customer receiving immediate service that are not paid by the customer. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.200 was set out in former 3 AAC 94.200.The history note of 19 AAC 96.200 does not reflect the history of 3 AAC 94.200. 3 AAC 106.210.Rural electrification revolving loan fund application (a)An applicant for a loan from the rural electrification revolving loan fund shall submit an application, which contains at the time of filing,the following information: Exhibit R-3 Page 9 of 18 (1)the legal name of the applicant and the legal authority under which it was created and other information that will demonstrate that the applicant is an eligible borrower under AS 42.45.020, including evidence that it holds a certificate of public convenience and necessity issued by the Regulatory Commission of Alaska allowing it to provide electric service to the area where the proceeds of the loan will be used; (2)a certified copy of the resolution or other official action taken by the applicant's governing body authorizing the application for a loan; (3)the name,title,and address of the applicant's official correspondent or representative for purposes of the application; (4)the names and titles of the applicant's principal officers,including the chief executive officer or general manager; (5)the names and addresses of the engineer,legal counsel,financial advisor or consultant,and any management,engineering,design,economic,or other advisors or consultants that the applicant has for the project; (6)the total amount of the loan requested; (7)a description of the use to which the loan money will be applied,including (A)geographic location of the project; (B)a narrative describing the physical components and the electrical characteristic of the project; (C)a comprehensive statement clearly demonstrating public need for the project and the project's eligibility under AS 42.45.020; (D)the proposed allocation of loan money to each purpose or to each phase of a project and the expected date of completion of each; (E)information necessary so the loan advisory committee can consider the matters required by AS 42.45.030 and by 19 AAC 96.230,including a (i)description of each structure to be served and whether it is temporary or permanent for each customer identified in (12)of this subsection and all other customers the applicant expects will be served by the extension of electric service within the 10-year period following completion of the project; (ii}description of the present and expected future use of land in the area to be served by the extension of electric service,including residential population and commercial facility density and zoning,if any; (iii)description of the terrain that will be crossed by the extension of electric service and information about the ownership status of each parcel to be crossed,including information about any easements and rights-of-way granted or expected to be granted; (iv)description of all other utility service available or expected to be available in the area to be served by the extension of electric service;and (v)projection of the number of new customers that the applicant expects to be served by the extension of electric service for each of the 10 years following completion of the project and an estimate of the cost to provide a service connection to each of those customers; (8)information from which the authority can determine that the project is technically and financially feasible; (9)the status of any proceedings necessary for the applicant to obtain permits,certificates,or other authorizations from any federal,state,or local agency necessary to begin,complete,and operate the project; Exhibit R-3 Page 10 of 18 (10)financial statements of the applicant and any other party or parties acting as guarantor of the loan, unless otherwise required by the authority;these financial statements must include,when possible, balance sheets and profit-and-loss statements and must be certified by an independent certified public accountant; (11)for an investor-owned electric utility,a business history of any person or entity owning or controlling 10 percent or more of the applicant's stock or business; (12)the name and location of each customer who has applied for service and for whom immediate service is expected to be provided and whether those customers are receiving electric service from a public utility at the time of the loan application; (13)information from which the authority can determine whether the applicant has the financial ability to provide from other money available to it an amount equal to that required for acquisition and installation of one transformer,one span of line,one pole,and one service drop as required for each customer to whom immediate service will be provided;and (14)a loan repayment analysis that demonstrates expected payments of principal and interest over the first 10 years following completion of the project sufficient to retire the full amount of the obligation, including (A)the connection costs calculated as the average costs anticipated at the time of the application for acquisition and installation of one transformer,one span of line,one pole,and one service drop; (B)the expected number of additional customers to be connected to the service extension financed by the loan (i)during the first 30 days following completion of the project; (ii)after the first 30 days but before the end of the first calendar year following completion of the project;and (iii)during each of the nine calendar years following the first calendar year; (C)assumptions made in forecasting the number of additional customers under (B)of this paragraph, and other information that demonstrates the reasonableness of the forecast; (D)the estimated actual cost,at the time of the application,to provide a service connection to each new customer identified under (B)(ii)and (B)(iii)of this paragraph,plus a statement of any assumptions or information that demonstrates the reasonableness of the cost estimates; (E)the expected principal repayment during each of the first 10 years;the repayment is calculated as the sum of the differences between the cost for each connection for that year identified under (D)of this paragraph and the average cost calculated under (A)of this paragraph for each such connection described in (D)of this paragraph that costs less than the average cost calculated under (A)of this paragraph; (F)the expected interest payment during each of the first 10 years,which is calculated as two percent of the unpaid principal balance; (G)the surcharge required from each new customer identified under (B)of this paragraph,during each of the first 10 years,to generate the expected interest payment described in (F)of this paragraph;the surcharge is calculated annually by dividing the expected interest payment by the total number of customers connected with the loan proceeds; (H)a comparison of the annual principal payments calculated under (E)of this paragraph with the applicant's total projected annual revenue for each of the first 10 years; Exhibit R-3 Page 11 of 18 (15)if the applicant is a Native village council,a resolution waiving sovereign immunity on a form provided by the authority. (b)An applicant shall in addition to the application,timely provide other information requested by the authority. (c)An application must be submitted to the authority. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.210 was set out in former 3 AAC 94.210.The history note of 19 AAC 96.210 does not reflect the history of 3 AAC 94.210. 3 AAC 106.220.Review by authority (a)Upon receipt of a completed application and other information requested or required,the authority will review the application. (b)The authority,after reviewing the application,will make a determination that includes the following: (1)written comments analyzing whether (A)the money will be used to pay the costs of activities that are eligible under AS 42.45.020 and the applicant is an eligible borrower under AS 42.45.020; (B)the project will meet the needs of the area to be served by the project and will benefit the area; (C)the project is technically feasible; (D)alternatives to the project exist that would result in extension of electric service by a different method,or by an entity other than the applicant,which could reasonably be expected to provide,within a time schedule comparable to the project,electric service at a lower cost to the consumer; (E)the applicant has applied for,or has been awarded,necessary permits or certificates; (F)the project is financially feasible; (G)the applicant has the ability to provide from money other than the proceeds of the loan an amount equal to that required for acquisition and installation of one transformer,one span of line,one pole,and one service drop as required for each customer for whom immediate service is expected to be provided; (H)the needs of,and benefits to,the area to be served by the project are greater than the needs of,and benefits offered to,other areas of the state by a project for which sponsors may also seek loan money from the authority if there is not sufficient money in the rural electrification revolving loan fund for both projects,if this determination can be made based on information existing at the time of the authority's review,considering factors such as the number of customers to be served by the project,the cost to serve each customer,and the availability of alternative sources of capital to the respective utilities;and {I)the applicant has,or will have,sufficient revenue from all sources to repay the loan; (2)a statement setting out proposed loan terms and conditions;and (3)other comments that the authority considers appropriate. Exhibit R-3 Page 12 of 18 (c)If the authority approves the loan application,the authority will prepare a written decision and deliver a copy of its decision to the applicant.The decision will (1)indicate whether there are conditions that the applicant must satisfy before the authority will make the loan to the applicant;and (2)include proposed loan terms. (d)Repealed 3/25/2005. (e)If the authority approves an application,the authority will prepare a loan agreement and other appropriate documentation to reflect the terms of the loan sufficient,as determined by the authority to assure repayment of the !oan in accordance with its terms,and to provide for other matters the authority considers appropriate in connection with the loan.The authority will not disburse the proceeds of the loan to the borrower until the borrower has entered into the loan agreement with the authority. History History:Eff.2/16/96,Register 137;am 3/25/2005,Register 173 Annotations Authority:AS 42.45.020 AS 42.45.030 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.220 was set out in former 3 AAC 94.220 and 3 AAC 94.240.The history note of 19 AAC 96.220 does not reflect the history of 3 AAC 94.220 and 3 AAC 94.240. 3 AAC 106.230.Review by loan advisory committee (a}Within 15 days after a completed application has been received,the department will appoint a loan advisory committee composed of three individuals,each of whom resides within the certificated area served by the applicant,but none of whom is a person identified in 3 AAC 106.210(a)(12). (b}Members of the committee may be selected by the department from lists of nominees provided by the applicant and by community groups and interested persons,but when possible,the committee may not include more than one individual who directly represents any of the following: (1)the State of Alaska; (2)a borough or city; (3)a village council; (4)an Indian Relocation Act (IRA)council; (5)consumers; (6)utilities; (7)business or labor organizations; (8)finance and real estate professions; (9)a regional corporation; (10)a village corporation; Exhibit R-3 Page 13 of 18 (11)a nonprofit organization;or (12)the federal government. (c)The committee shall choose a chairperson from among its members and within 30 days after appointment by the department shall,following reasonable notice to the public,hold at least one public meeting in the area served by the applicant. (d)The committee's recommendation concerning the loan shall be transmitted by the chairman to the department within 45 days after receiving the department's written determination provided for in 3 AAC 106.220.In making its recommendation,the committee shall consider the factors set out in AS 42.45.030. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 42.45.030 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.230 was set out in former 3 AAC 94.230.The history note of 19 AAC 96.230 does not reflect the history of 3 AAC 94.230. 3 AAC 106.240.Terms of loans (a)The authority will establish the terms of a loan made from the rural electrification revolving loan fund when the authority approves the loan application under 3 AAC 106.220. (b)A loan must bear an interest rate equal to two percent a year on the unpaid balance.Interest paid to the authority must be recovered by the electric utility receiving the loan through a surcharge to the regular electric rates paid by the customers served by the electric service extended with the loan proceeds.Interest payments to the authority are due on the first day of the calendar year following the extension of electric service and on the first day of each calendar year thereafter until paid in full. (c)A loan from the rural electrification revolving loan fund will be made only to finance a project if full repayment of the loan is likely to be made within 10 years.Payment of the unpaid balance of the principal of the loan is deferred until the first day of the calendar year following the extension of electric service.At that time,and annually after that,the annual principal repayment amount due will be calculated as follows: (1)the average cost to the electric utility to acquire and install one transformer,one span of line,one pole,and one service drop during the initial 30-day period following the extension of electric service must be calculated by the electric utility and verified by the authority;after the first year following the extension of electric service,and in January of each year until the loan is fully repaid,a recognized construction-cost index for the area will be used to adjust the amount specified for the first year under this paragraph; (2)the actual cost to the electric utility to provide each service connection to customers first served in the preceding calendar year must be reported by the electric utility to the authority each January,and Exhibit R-3 Page 14 of 18 the cost must be verified by the authority;the first report must exclude the cost of service connections for customers connected during the initial 30-day period following extension of electric service; (3)for each customer for whom the cost of connection reported under (2)of this subsection is equal to or greater than the amount calculated under (1)of this subsection,no principal payment is due; (4)for each customer for whom the cost of connection reported under (2)of this subsection is less than the amount calculated under (1)of this subsection,the difference is due as a principal repayment. (d)Notwithstanding (c)of this section,the authority and the borrower may agree to a fixed repayment term. (e)Aloan must be supported by appropriate documentation that may include a loan agreement,bonds, notes,or other documentation,in a form satisfactory to the authority. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.240 was set out in former 3 AAC 94.250.The history note of 19 AAC 96.240 does not reflect the history of 3 AAC 94.250. 3 AAC 106.250.Inspection of records and facilities The provisions of 3 AAC 106.130 concerning inspection of records and facilities of applicants for loans from the power project fund apply also to applicants for loans from the rural electrification revolving loan fund. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 44.83.080 Editor's note:Before 2/16/96,Register 137,the substance of 19 AAC 96.250 was set out in former 3 AAC 94.260.The history note of 19 AAC 96.250 does not reflect the history of 3 AAC 94.260. 3 AAC 106.260.Loan amounts (a)A loan will not exceed $250,000 per loan application for a specific project if the rural electrification revolving loan fund balance is less than $3,000,000 at the time of application. (b)A loan will not exceed $500,000 per loan application for a specified project if the rural electrification revolving loan fund balance is $3,000,000 or more at the time of application. Exhibit R-3 Page 15 of 18 History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.020 AS 44,.83.080 3 AAC 106.269.Definition In 3 AAC 106.200 -3 AAC 106.269,"financially feasible"means that the authority has determined that enough money is available from all sources to complete the project,and that enough money is estimated to be available in the future to repay any debt incurred in connection with the project,taking into consideration the relationship between the estimated user fees or charges upon completion of the project and the estimated user fees or charges if consumers of services provided by the project would have continued to receive services from existing sources,the relationship between the estimated user fees or charges upon completion of the project and the present or estimated user fees or charges for similar services in the state,and whether the loan is secured by a means other than by a pledge or revenues of the project. History History:Eff.4/8/2015,Register 214 Annotations Authority:AS 42.45.020 AS 44.83.080 Article 4 General Provisions Section 900.Definitions. 3 AAC 106.900.Definitions (a)In this chapter,unless the context requires otherwise, (1)deleted; (2)Repealed 4/8/2015; (3)deleted; (4)"regional corporation"means an Alaska Native regional corporation established under the laws of this state in accordance with the provisions of 43 U.S.C.1601 -1629(e)(Alaska Native Claims Settlement Act). (b)In AS 42.45,unless the context requires otherwise,"nonprofit marketing cooperative"means a cooperative organized under AS 10.15 (Alaska Cooperative Corporation Act),which is operated on a nonprofit basis for the mutual benefit of its members and which has bylaws containing provisions Exhibit R-3 Page 16 of 18 relating to the disposition of revenues and receipts as may be necessary and appropriate to establish and maintain its nonprofit and cooperative character,or a cooperative organized under AS 10.25 (Electric and Telephone Cooperative Act)that exercises the powers granted to an electric cooperative by AS 10.25.020. (c)In AS 42.45 and this chapter,unless the context requires otherwise, (1)"economically viable"means (A)a project for which the long term benefits exceed the long term costs;or (B)the project is financially feasible in the absence of a government grant for the project; (2)"extension of electric service”means the point when at least three new customers begin receiving electric service through an extension made in connection with a loan from the rural electrification revolving loan fund; (3)"immediate service"means electric service provided within 30 days after completion of the extension of electric service made in connection with a loan from the rural electrification revolving loan fund; (4)"village corporation"means an Alaska Native Village Corporation organized under the laws of the State of Alaska as a business for profit or nonprofit corporation to hold,invest,manage,and distribute land,property,money,and other rights and assets for and on behalf of a native village in accordance with the terms of the Alaska Native Claims Settlement Act (PL 920-203); (5)"village council"means the duly elected governing body of an unincorporated community which has between 25 and 600 people residing within a two-mile radius; (6)"authority"means the Alaska Energy Authority created in AS 44.83.020. (d)In AS 42.45.010,"independent power producer”means a corporation,person,agency,authority,or other legal entity or instrumentality,that is not a utility and that owns or operates a facility for the generation or production of electric or thermal energy for use by the residents,local government,or businesses of one or more municipalities or unincorporated communities recognized by the Department of Commerce,Community,and Economic Development for community revenue sharing under AS 29.60.850 -29.60.879 and 3 AAC 180. (e)In AS 42.45.010 and this chapter, (1)"alternative energy" (A)means energy or fuel that is used for production of electricity,heat,or mechanical power,and that is derived from renewable or local sources other than liquid petroleum; (B)includes, {i)wind,solar,geothermal,hydroelectric,and biomass power sources;and (ii)local sources of coal and natural gas; (2)"alternative energy facility”means a facility that generates or produces alternative energy; (3)"electric utility"has the meaning given the term "public utility”in AS 42.05.990(6)(A). History History:Eff.2/16/96,Register 137;am 10/16/2009,Register 192;am 4/8/2015,Register 214 Exhibit R-3 Page 17 of 18 Annotations Authority:AS 42.45.010 AS 44.83.080 Editor's note:As of Register 205 (April 2013),and acting under AS 44.62.125(b)(6),the regulations attorney deleted the definition of "fiscal note"formerly set out in 3 AAC 106.900(a),to reflect the enactment of ch.46,SLA 2012.Effective January 1,2013,ch.46,SLA 2012 made statutory changes with respect to the bulk fuel revolving loan program,transferring authority over that program from the Alaska Energy Authority to the division in the Department of Commerce,Community,and Economic Development that is responsible for community and regional affairs.Accordingly,the regulations attorney deleted former 3 AAC 106.300 -3 AAC 106.365.Because the term "fiscal year"appeared only in the deleted provisions,the regulations attorney deleted the now obsolete definition for that term. As of Register 208 (January 2014),and acting under AS 44.62.125(b)(6),the regulations attorney made a technical change to 3 AAC 106.900(a)(4)to correct a manifest printing error. In 2010 and 2012 the revisor of statutes -acting under AS 01.05.031 and codifying changes that appear in sec.10,ch 16,SLA 2010 and sec.5,ch.51,SLA 2012 -realphabetized definitions in AS 42.05.990,so that the paragraph originally numbered AS 42.05.990(4)is now numbered AS 42.05.990(6).As of Register 211 (October 2014),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to 3 AAC 106.900(e),so that a cross-reference to former AS 42.05.990(4)(A)now refers to the renumbered provision,AS 42.05.990(6)(A). Exhibit R-3 Page 18 of 18 Exhibit R-4 Chapter 107 Grant Programs Article 1.Power Cost Equalization Program.(3 AAC 107.200 -3 AAC 107.270) 2.Utility Improvements Grant Program.(3 AAC 107.300 -3 AAC 107.430) 3.Electrical Service Extension Fund Grants.(3 AAC 107.500 -3 AAC 107.550)[Fund repealed] 4.Renewable Energy Grant Program.(3 AAC 107.600 -3 AAC 107.695) 5.Emerging Energy Technology Grant Program.(3 AAC 107.700 -3 AAC 107.799) 6.General Provisions.(3 AAC 107.990 -3 AAC 107.990) Annotations Editor's note:As of Register 151 (October 1999),the provisions of former 19 AAC 97 were relocated by the regulations attorney under AS 44.62.125(b)(6)to 3 AAC 107 in accordance with ch.58,SLA 1999. Article 1 Power Cost Equalization Program Section 200.Technical requirements;metering. 210.Overpayments. 220.Power cost equalization pro-rata reduction. 225.Allocation of supplemental appropriations after pro rata reduction. 230.Exclusions from power cost equalization. 240.Reporting and recordkeeping requirements. 250.Power cost equalization and the commission. 260.Standards for customer eligibility. 267.State or federal funding of community facilities. 270.Definitions. 3 AAC 107.200.Technical requirements;metering (a)An eligible electric utility shall install and maintain (1)operational equipment designed to meter power consumption of its utility customers,including community facilities and power stations; (2)a fuel meter on the day tank to record the amount of fuel used to generate electric power on a daily basis; (3)an appropriate master meter or totalizing meter and demand register to measure the electric power generated at the main bus-bar;and (4)a station service meter to measure the power consumed by the utility for lights and heat for the power plant. Exhibit R-4 Page 1 of 39 (b)No metering is required for street lights. (c)An electric utility that has technical or financial problems in implementing the metering requirements in (a)of this section may petition the authority for technical assistance. (d)The authority will,in its discretion,exempt an electric utility from the requirements of (a)of this section if the authority determines that compliance is not practicable.The exemption will remain in effect until the authority determines that the conditions for which it was granted no longer exist. (e)An electric utility owning or operating any new generating plant built or upgraded after October 28, 1989 is not eligible for the exemption in (d)of this section. (f)Failure to comply with (a)of this section or to secure an exemption under (d)of this section,means that non-metered electric utility customers,including community facilities,are not eligible to receive power cost equalization credits. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.130 AS 44.83.080 3 AAC 107.210.Overpayments (a)The authority is entitled to reimbursement if an eligible electric utility,or its electric utility customers,have received power cost equalization payments to which they were not entitled. (b)Grounds for reimbursement include (1)an interim or permanent power cost equalization reduction ordered by the commission; (2)a reduction of power cost equalization resulting from an adjustment to fuel or other eligible costs ordered by the commission; (3)payment disbursed in error or based on an erroneous or undocumented monthly report. (c)An adjustment in the power cost equalization amount per kilowatt hour in (b)(1}and (b)({2)ofthis section is retroactive to the effective date of its determination by the commission. (d)The authority will recover any overpayment under this section by reducing the future power cost equalization payments to be disbursed or by demanding repayment from the participating utility, whichever method the authority determines is appropriate. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.160 Exhibit R-4 Page 2 of 39 AS 42.45.170 AS 44.83.080 3 AAC 107.220.Power cost equalization pro-rata reduction When power cost equalization payments paid to each electric utility are reduced on a pro rata basis as required by AS 42.45.110(i),eligible electric utilities will implement the pro rata reduction effective with the comparable monthly report.An electric utility shall consult with the authority regarding implementation of the reduction. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.225.Allocation of supplemental appropriations after pro rata reduction if a supplemental appropriation is received for the power cost equalization program after the authority has made a pro rata reduction under AS 42.45.110(i),the authority will (1)increase the power cost equalization payments to be made to eligible utilities for the rest of the fiscal year ona pro rata basis up to the maximum allowable under AS 42.45.110;and (2)if any money remains after payments are made under (1)of this section,make additional power cost equalization payments to eligible utilities that received reduced payments under AS 42.45.110(i)to restore funding to the maximum allowable under AS 42.45.110 for each month,starting from the most recent month and going back to the beginning of the state fiscal year. History History:Eff.7/30/2006,Register 179 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.230.Exclusions from power cost equalization (a)A customer whose facility has more than one meter will only receive power cost equalization credit for the master meter. Exhibit R-4 Page 3 of 39 (b)Power consumption measured by a station service meter required in 3 AAC 107.200 is not eligible for power cost equalization credit. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.240.Reporting and recordkeeping requirements (a)An eligible electric utility shall submit a power cost equalization report to the authority within 10 working days after the end of its billing period.The report must set out the power consumption ofthe previous month and must be in the format required by the authority.Within each fiscal year an eligible electric utility shall submit 12 separate monthly reports. (b)Power cost equalization payments will not be made for power consumed through June 30 of a year if the relevant monthly report is received after August 31 of that year. (c)An eligible electric utility shall report separately,in the format required by the authority,the power eligible for power cost equalization that is consumed by each of its customers. (d)An eligible electric utility shall keep accurate periodic written records for the fuel day meters, generating meters,and station service meters required by 3 AAC 107.200. (e)An eligible electric utility shall organize and maintain,in accordance with standard accounting practices,the accounts of its electric fund as a separate accounting entity in a self-balancing set of accounts that includes the assets,liabilities,balance,revenue,and expenses of the electric fund. (f)An eligible electric utility shall make its records available to the authority and the commission within 60 days after receipt of a request to do so. (g)Failure to comply with (f)of this section may result in (1)suspension by the authority of the power cost equalization disbursements to the eligible electric utility,until satisfactory records are provided; (2)loss of the suspended power cost equalization disbursements,if satisfactory records are not submitted by January 31 ofthe following fiscal year. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.130 Exhibit R-4 Page 4 of 39 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.250.Power cost equalization and the commission (a)The authority and the commission have statutory responsibilities in furtherance of the power cost equalization program. (b)3 AAC 107.200 -3 AAC 107.270 should be read together with 3 AAC 52.600 -3 AAC 52.690. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.120 AS 42.45.130 AS 42.45.140 AS 42.45.150 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.260.Standards for customer eligibility To receive a power cost equalization payment,a customer of an eligible electric utility (1)must be billed by the utility in accordance with the relevant tariff,rate structure,separate demand charge,or minimum charge; (2)shall make timely payments to the utility,for the electric power purchased,at least annually or on an appropriate schedule throughout the year,and in an amount equal to the required annual payment,if this practice is justified by the community's seasonal economy,the local utility rule,and the economic feasibility of the practice by the local utility;and (3)shall pay to the utility at least the applicable base amount determined by the commission under AS 42.45.110 and 3 AAC 52.160,plus the difference between the utility rate and the amount of power cost equalization,for each kilowatt-hour consumed. History History:Eff.2/16/96,Register 137 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.120 AS 42.45.130 Exhibit R-4 Page 5 of 39 AS 42.45.140 AS 42.45.150 AS 42.45.160 AS 42.45.170 AS 44.83.080 3 AAC 107.267.State or federal funding of community facilities (a)Acommunity facility is not eligible for power cost equalization if the costs of operating the community facility,or eligible portion of the community facility,are paid for by the state,federal government,or private commercial interests. (b)As used in (a)of this section,the receipt of state or federal government funds by a community facility is not state or federal government payment for the costs of operating the community facility if the local community will receive the benefits of the power cost equalization payment,rather than the state or federal government.The local community receives the benefits of the power cost equalization payment if (1)the state or federal government does not direct the community facility to spend the state or federal government funds on operating costs of the community facility,and (2)the power cost equalization payment will not reduce the amount of state or federal government funding provided to the community facility. (c)For all or a portion of a community facility that receives state or federal government funds to be eligible for power cost equalization payment under the criteria established in (b)of this section,the community facility must certify on a form acceptable to the authority that the receipt of state or federal government funding satisfies each condition of (b)of this section. History History:Eff.7/25/2014,Register 211 Annotations Authority:AS 42.45.110 AS 42.45.150 AS 44.83.080 3 AAC 107.270.Definitions (a)In 3 AAC 107.200 -3 AAC 107.270 and in AS 42.45.110 -42.45.170,unless the context requires otherwise, (1)"commission"means the Regulatory Commission of Alaska; (2)"customers"means (A)an eligible electric utility's residential customer of energy for a single-family or multi-family dwelling, or residential housing unit; (B)an eligible electric utility's commercial customer of energy for a business,school,or building other than the customers identified in (A),(C),and (D)of this paragraph; (C)a community facility as defined in AS 42.45.150; Exhibit R-4 Page 6 of 39 (D)state or federal customers; (3)deleted; (4)"state or federal customer"means a state or federal office or facility other than public schools; (5)"authority"means the Alaska Energy Authority created in AS 44.83.020; (6)"residential customer"means a customer whose residence is the (A)location receiving electrical service,regardless of whether the customer engages in commercial activity at the customer's residence;and (B)place of residence in this state as determined under AS 15.05.020 for the purpose of voting. (b)As used in AS 42.45.150(1),"community building"means a community facility that (1)is not operated for profit; (2)is operated for the benefit of the general public; (3)complies with 3 AAC 107.260(1); (4)makes timely payments to the utility for the electric power consumed;and (5)complies with 3 AAC 107.260(3). History History:Eff.2/16/96,Register 137;am 3/25/2005,Register 173;am 7/25/2014,Register 211 Annotations Authority:AS 42.45.100 AS 42.45.110 AS 42.45.120 AS 42.45.130 AS 42.45.140 AS 42.45.150 AS 42.45.160 AS 42.45.170 AS 44.83.080 Article 2 Utility Improvements Grant Program Section 300.Grants for utility improvements;purpose of fund. 310.Notice of availability of money in fund. 320.Utility improvements grant limits. 330.Grant application. 340.Evaluation committee;ranking of applications;award of grants. 350.Grant agreement. 360.Conditions for receiving a utility improvements grant. 370.Insufficient money. 380.Inspection of records and facilities;audits and examinations. Exhibit R-4 Page 7 of 39 A400.Termination of grant agreement;ineligibility. 410.Title to project. 420.Modifications. 430.Definition for 3 AAC 107.300 -3 AAC 107.430. 3 AAC 107.300.Grants for utility improvements;purpose of fund (a)The provisions of 3 AAC 107.300 -3 AAC 107.430 implement and interpret AS 42.45.180 relating to the responsibilities and powers of the authority with respect to grants for utility improvements from the power cost equalization and rural electric capitalization fund.The authority may use money available in the fund to make grants for utility improvements as provided in 3 AAC 107.300 -3 AAC 107.430.It is a purpose of the fund to provide grants to improve existing utility systems and thereby to reduce the costs to the fund for power cost equalization under AS 42.45.100 -42.45.170. (b)A grant under 3 AAC 107.300 -3 AAC 107.430 is subject to the availability of money in the fund for that purpose.As soon as practical in each fiscal year,the authority shall determine the amount of money in the fund.During each fiscal year,the authority shall make available for grants for utility improvements from the fund an amount equal to three percent of the amount of money in the fund as of July 1 of that fiscal year. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.310.Notice of availability of money in fund If the authority determines under 3 AAC 107.300 that money is available from the fund for grants for utility improvements,the authority shall publish notice of the amount of money available for the grants. The authority shall include in the notice information regarding application procedures,a summary of significant terms and conditions that shall apply to the grants,and a statement of the time by which the authority must receive applications.The authority shall publish the notice by the method that it considers appropriate.Upon receipt of written request from a person,the authority shall mail to the person a sample grant agreement and the evaluation criteria that will be used to select recipients of the grants. History History:Eff.6/29/94,Register,131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 Exhibit R-4 Page 8 of 39 AS 42.45.180 AS 44.83.080 3 AAC 107.320.Utility improvements grant limits The authority may not award a grant to a recipient under 3 AAC 107.300 -3 AAC 107.430 ina fiscal year in an amount that exceeds 20 percent of the amount in the fund available in that fiscal year for grants under 3 AAC 107.300 -3 AAC 107.430.An applicant may apply for,and the authority may award to an applicant,more than one grant under 3 AAC 107.300 -3 AAC 107.430 during a fiscal year;however,the applicant must submit a separate application for each grant requested. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.330.Grant application (a)A person who wishes to receive a grant under 3 AAC 107.300 -3 AAC 107.430 must submit an application to the authority.The application must be dated and must (1)state the legal name of the applicant and the legal authority under which the applicant was created; (2)include sufficient information about the applicant to demonstrate to the satisfaction of the authority that the applicant is eligible to receive a grant from the fund; (3)include a certified copy of the resolution or other official action by the governing body of the applicant authorizing the application for a grant; (4)state the name,title,and address of the official correspondent or representative of the applicant for purposes of the application; (5)state the names and titles of the principal officers,including the chief executive officer or general manager,of the applicant; (6)state the name and address of the engineer,legal counsel,financial advisor or consultant,and other advisors or consultants that the applicant has for the project for which the grant is requested,including management,engineering,design,and economic advisors and consultants; (7}state the amount of the grant requested; (8)provide a general description of the use to which the grant proceeds will be applied,including (A)the location of the project for which the grant is requested; (B)a comprehensive statement clearly demonstrating public need for the project and the project's eligibility for financing with money from the fund; (C)the proposed allocation of grant proceeds to each purpose or phase of the project and a schedule for the beginning and completion of each phase of the project; Exhibit R-4 Page 9 of 39 (9)include a statement identifying all other money sources and amounts,and anticipated commitment dates for each source,and demonstrate to the satisfaction of the authority that the applicant's project cannot be completed without the requested grant; (10)provide information that demonstrates to the satisfaction of the authority that the project is technically feasible and that demonstrates,as described in (c)of this section,that the project is economically feasible; (11)provide information that demonstrates to the satisfaction of the authority that the applicant has obtained or will obtain all permits,certificates,or other authorizations from any federal,state,or local agency necessary to begin,complete,and operate the project within the schedule provided for the project; (12)unless otherwise required by the authority,provide financial statements of the applicant that demonstrate that the applicant is financially capable of owning or operating the project for which the grant is requested and of using the grant proceeds in accordance with the terms of the grant;the financial statements must include balance sheets and profit-and-loss statements and must be certified by an independent certified public accountant; (13)in the case of an investor-owned electric utility,provide a business history of any person owning or controlling 10 percent or more of the applicant's stock or business and,if necessary,other information demonstrating to the satisfaction of the authority that the applicant is capable of successfully owning and operating the project; (14)include information sufficient in the determination of the authority to establish the total cost of the project; (15)include a description of the project;and (16)include information sufficient in the determination of the authority to demonstrate that at least 25 percent of the total cost of the project will be paid with money derived from a source other than the fund;contributions in a form other than money do not satisfy the requirements of this paragraph. (b})In addition to the information described in (a)of this section,the authority may require information that the authority considers necessary or desirable in order to determine whether a grant request meets the requirements of AS 42.45.100 and 42.45.180 and 3 AAC 107.300 -3 AAC 107.430.To be considered for a grant,an applicant must provide any required additional information within the time established by the authority. (c)To demonstrate economic feasibility for purposes of (a)(10)of this section,an applicant shall project the operating and capital costs of the applicant's utility both with and without the proposed project for which the grant is requested.The authority shall review that information to determine whether there are savings to the applicant that would result from the proposed project and to determine the amount of the savings relative to the size of the requested grant for purposes of ranking the application under 3 AAC 107.340(c). (d)The executive director of the authority may waive some or all of the requirements of (a)of this section if the executive director of the authority determines that (1)the requirement to be waived is not necessary to enable the authority to determine the eligibility of the grant application under AS 42.45.100 and 42.45.180;(2)the waiver is necessary to avoid hardship in the community served or to be served by the project for which the grant is requested;or (3)the authority has other sources of information that it can use in reviewing the application in place of the requirement to be waived or the Exhibit R-4 Page 10 of 39 authority will be able to adequately analyze the eligibility of the applicant in the absence of that information. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.340.Evaluation committee;ranking of applications;award of grants (a)For the purpose of reviewing applications received under 3 AAC 107.300 -3 AAC 107.430,the executive director of the authority shall appoint an evaluation committee.The committee must include authority personnel who are competent to review the projects for which grants are requested.The authority shall transfer to the evaluation committee the applications the authority receives before the filing deadline set in the notice described in 3 AAC 107.310. (b)Upon receipt from the authority of complete applications and any additional information required under 3 AAC 107.330,the evaluation committee shall review the applications.The committee shall rank the applications that it has determined satisfy the requirements of AS 42.45.180 and 3 AAC 107.330 and further the purposes for which the fund was created as described in 3 AAC 107.300(a),except that the committee may decline to rank such an application if,in the judgment of the committee,the project for which the grant is requested would create an unreasonably high risk to public health or welfare.The committee shall determine the approved grant amount for each ranked application.If the committee determines that an application does not satisfy the requirements of AS 42.45.180 or 3 AAC 107.330 solely because of the amount ofthe grant requested,the committee may change the amount of the grant requested so that the application will satisfy the requirements of AS 42.45.180 and 3 AAC 107.330 and then shall rank the application accordingly. (c)The evaluation committee shall rank applications based upon the committee's determination of (1) each project's likelihood of reducing the costs of generating and transmitting power relative to the size of the grant requested;(2)the public need for the project;and (3)the economic feasibility of the project as demonstrated under 3 AAC 107.330(a)(10)and (c).In ranking applications,the committee also shall consider the applicant's financial and credit record for the purpose of determining whether the applicant has the ability to use the requested grant in a manner that effectively accomplishes the purposes of the grant.The committee shall complete its ranking of the applications within 90 days after the filing deadline for those applications as set under 3 AAC 107.310(a).The committee shall make its rankings in writing,shall include a summary of the reasons for the rankings,and shall deliver a copy of the decision to the authority (d)The authority shall award grants under 3 AAC 107.300 -3 AAC 107.430 to successful applicants in the order that the applications were ranked by the evaluation committee and in the amounts approved by the committee until either grants have been awarded for all ranked applications or there is no more Exhibit R-4 Page 11 of 39 money available in the fund for the grants,whichever occurs first.The authority shall provide written notice to each applicant of its ranking under this section. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.350.Grant agreement (a)If the authority awards a grant to an applicant under 3 AAC 107.340(d),the applicant must enter into a grant agreement with the authority within 60 days after receiving notice from the authority that the applicant has been awarded the grant.If the applicant fails to enter into the grant agreement within the 60 days,the applicant forfeits the right to receive the grant.If the authority determines that failure to timely enter into a grant agreement is caused by actions of the authority,the director may extend the time to enter into the grant agreement. (b)The authority shall prepare the grant agreement required by (a)of this section and other appropriate documentation to reflect the terms of the grant and to provide for other matters the authority considers appropriate in connection with the grant.The authority may not disburse proceeds of the grant to a successful applicant until the applicant has entered into the grant agreement with the authority and has executed any other documents required under this section.Unless waived by the authority,the grant agreement will include the following: (1)a statement of the intended use of the grant proceeds,specifying how the proceeds will be used in connection with the purposes of the fund; (2)a budget description in detail appropriate to the scope of the project; (3)a timetable listing the steps considered necessary for the timely completion of the project and listing the schedule for the disbursement of grant proceeds; (4)a provision for the administration of the grant proceeds according to generally accepted financial accounting procedures,for regular periodic reporting to the authority of grant-financed activities,and for the disposition of grant proceeds in accordance with intended use; (5S)provisions for the termination or suspension of grant disbursements and for termination of the grant agreement,including a statement of the provisions in 3 AAC 107.400; (6)a provision acknowledging that all grant proceeds,until they are spent for the purposes of the grant and in accordance with the grant agreement,remain the property of the state and,if not expended for the purposes ofthe grant and in accordance with the grant agreement,will be returned to the authority within 30 days after the final date on which the grant proceeds were scheduled to be spent under the terms of the grant agreement; (7)a statement acknowledging that the applicant and its employees,agents,and advisors,and not the authority,are responsible for obtaining necessary licenses and permits,if any,for ensuring that all Exhibit R-4 Page 12 of 39 aspects of the project comply with all applicable statutes,regulations,ordinances,and codes,and for all costs of the project in excess of the amount of the approved grant; (8)a promise to defend and hold harmless,and to require all contractors and subcontractors to hold harmless,the authority from any action arising from a determination not to award a subsequent grant under 3 AAC 107.300 -3 AAC 107.430; (9)a requirement that the grant recipient submit to the authority plans and specifications for the recipient's project within 90 days after entering into the grant agreement; (10)a requirement that the grant recipient obtain all necessary permits for the project within eight months after entering into the grant agreement; (11)a requirement that the grant recipient complete all field construction work for the project within 18 months after entering into the grant agreement;and (12)a provision stating that the applicant agrees to the inspection,audit,and examination provisions in 3 AAC 107.380. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.360.Conditions for receiving a utility improvements grant A recipient of a grant under 3 AAC 107.300 -3 AAC 107.430 may not use the proceeds ofthe grant to pay for costs of a project that were incurred before the applicant entered into a grant agreement under 3 AAC 107.350{a)unless the executive director of the authority approves payment ofthe costs. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.370.Insufficient money If the amount of money in the fund is not sufficient to initially award grants for all the ranked applications as provided in 3 AAC 107.340(d),the authority shall notify the successful applicants for whom there is insufficient money in the fund to award grants.The notice must include a statement that the applicant's application was ranked but that there was insufficient money in the fund to award the grant.The notice also must inform the successful applicant that (1)if additional money becomes available in the fund in the same fiscal year,the authority,to the extent of that additional available Exhibit R-4 Page 13 of 39 money,will award grants to the remaining successful applicants in the order in which their applications were ranked;and (2)if the applicant does not receive a grant in the fiscal year for which the applicant applied,the applicant must resubmit its application within the time required for the following fiscal year to be considered for a grant in that period.If additional money becomes available in the fund,the authority shall award additional grants as described in the notice.The authority may award a grant to an applicant in an amount less than the amount requested by the applicant if there is insufficient money in the fund to award the full amount requested and if the purposes of the grant can be carried out with less than the full amount requested. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.380.Inspection of records and facilities;audits and examinations (a)Each applicant for a grant under 3 AAC 107.300 -3 AAC 107.430 and each grant recipient under 3 AAC 107.300 -3 AAC 107.430 shall agree to make its books and records,facilities,and real and personal property of any kind,available for inspection at any reasonable time by the authority or its agents upon receipt by the applicant or grant recipient of a written request to inspect at any time while the applicant's application is pending with the authority and at any time up to one year after the most recent disbursement of grant proceeds to the recipient. (b)The authority or its agents may inspect,upon reasonable notice,the construction of any project that is being financed,in whole or in part,with a grant under 3 AAC 107.300 -3 AAC 107.430. (c)A grant recipient shall, (1)at reasonable times during the applicable time period described in (a)of this section,and upon written request from the authority,submit to an audit or examination of the recipient's book and records by an independent firm of certified public accountants selected by the authority,in order to determine whether the provisions of the grant agreement have been complied with and,except as limited by 2 AAC 45.010,shall pay the cost of the audits or examinations; (2)upon written request from the authority,submit a sworn statement by a responsible officer of the recipient as to the purposes to which the grant proceeds have been applied. (d)An inspection,audit,or examination under this section is only for purposes of compliance with the requirements of AS 42.45.100 and 42.45.180 and 3 AAC 107.300 -3 AAC 107.430. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 Exhibit R-4 Page 14 of 39 AS 42.45.180 AS 44.83.080 3 AAC 107.400.Termination of grant agreement;ineligibility If the authority terminates a grant agreement for cause in accordance with the terms of the grant agreement under 3 AAC 107.300 -3 AAC 107.430,the authority may (1)require the grant recipient to repay to the authority the portion of the grant proceeds that relates to the termination;and (2)determine that the grant recipient is ineligible for further grants under this chapter. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.410.Title to project In connection with a grant under 3 AAC 107.300 -3 AAC 107.430 and for the purpose of ensuring that the grant proceeds are used for a public purpose,the authority may require that a deed restriction on the title to the land benefited by the grant be recorded requiring approval from the authority for sale or transfer of the title to the land and requiring that the property be used for the purposes of the grant. The deed restriction may include provisions restricting the sale or transfer of title to the land to an entity that is eligible for the grant. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.420.Modifications The authority may consider and treat a request for a modification to a grant as a grant application if,in the determination of the evaluation committee appointed under 3 AAC 107.340,the modification is material. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Exhibit R-4 Page 15 of 39 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 3 AAC 107.430.Definition for 3 AAC 107.300 -3 AAC 107.430 In 3 AAC 107.300 -3 AAC 107.430,"fund”has the meaning given in AS 42.45.190 History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132 Annotations Authority:AS 42.45.100 AS 42.45.180 AS 44.83.080 Article 4 Renewable Energy Grant Program Section 600.Purpose. 605.Public purpose requirements of renewable energy grants. 610.Eligible applicants. 615.Eligible projects. 620.Public notice of application period;solicitation of grant applications. 625.Grant applications. 630.Disclosure of applications and other materials submitted to the authority;confidentiality. 635.Acceptance of applications for consideration;eligibility review. 645.Feasibility and public benefit review of grant applications. 650.Requests for reconsideration. 655.Evaluation of grant applications. 660.Ranking of applications. 670.Additional information from applicant or grantee. 675.Grant agreement. 680.Grant closeout;return of unexpended grant money. 685.Project operations and maintenance reporting. 690.Dispute resolution. 695.Definitions for AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695. Exhibit R-4 Page 16 of 39 3 AAC 107.600.Purpose The purpose of 3 AAC 107.600 -3 AAC 107.695 is to establish procedures and criteria for grant applications,the evaluation of applications,recommendations to the legislature for the award of grants, and the administration of grants from the renewable energy grant fund under AS 42.45.045. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.605.Public purpose requirements of renewable energy grants The authority may take actions it determines are appropriate to protect the public purpose of renewable energy grants and the public interest in and benefit from the use of grant funds,including (1)limiting recommendations for grants to preliminary development phases,until the authority determines that subsequent phases are feasible,will result in sufficient benefit to the public,and are otherwise appropriate for grants; (2)seeking repayment of some or all of a grant if the grantee fails to comply with the terms and conditions of the grant or,without the prior approval of the authority,sells,conveys,or encumbers a project constructed with renewable energy grant money; (3)requiring review and approval by the Regulatory Commission of Alaska or,if the Regulatory Commission of Alaska does not have or exercise jurisdiction,review and approval by the authority,of rates charged for the use of assets funded in whole or in part with a renewable energy grant and for energy generated by those assets; (4)determining whether an applicant that is not a governmental entity and not a utility regulated by the Regulatory Commission ofAlaska will own and operate the project in a manner that will provide sufficient public benefit to support a recommendation under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695 for a grant;in making a determination under this paragraph,the authority will consider the applicant's previous experience,its ownership and financial resources,proposed financial oversight,and other factors relevant to the analysis of public benefit. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.610.Eligible applicants (a)To apply for a renewable energy grant,a person must (1)be an eligible applicant within the meaning given in AS 42.45.045(1);and Exhibit R-4 Page 17 of 39 (2)demonstrate,to the satisfaction of the authority and subject to (b)of this section,that the applicant will (A)own the renewable energy project; (B)own,lease,or otherwise control the site upon which the project is located;and (C)upon completion of the project,operate and maintain it for its economic life for the benefit of the public. (b)The authority may authorize conveyance of an ownership interest or of operations or maintenance responsibilities if the authority determines that the conveyance protects the public interest in and benefit from the grant. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.615.Eligible projects (a)A project that meets the requirements of AS 42.45.045(f)-(h)is eligible for a renewable energy grant. (b)For purposes of AS 42.45.045(f)(2)(B),a project is a direct use of renewable energy resources if it uses renewable energy resources to generate energy or to make a fuel used to generate energy. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.620.Public notice of application period;solicitation of grant applications (a)The authority will provide public notice of the application period by publishing notice on the authority's website and on the Alaska Online Public Notice System established under AS 44.62.175. (b)The authority will publish on its website a request for grant applications that includes the date,time, place,and method for delivering applications,and a description of the application requirements. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 Exhibit R-4 Page 18 of 39 3 AAC 107.625.Grant applications (a)An applicant must submit an application to the authority within the time specified in the request for applications with the documentation and in the format required in the request for grant applications. The application must include (1)information showing to the satisfaction of the authority that the applicant is an eligible applicant within the meaning given in AS 42.45.045(l)and under 3 AAC 107.610; (2)information showing to the satisfaction of the authority that the project is eligible under AS 42.45.045(f)-(h)and 3 AAC 107.615; (3)information showing to the satisfaction of the authority that the project is technically and economically feasible; (4)a description of the public benefit from the project; (5)a description of the project scope of work,schedule,milestones,and budget;the description must include an estimate of total project costs,the amount of grant money requested,and identification of other money or resources that are committed to the purposes of the grant; (6)a description of the applicant's financial resources and financial capability of developing the project, including matching resources and other financing necessary for project development;and (7)additional information as required in the request for grant applications or under 3 AAC 107.670. (b)As it considers necessary to obtain complete or additional information,the authority will require applicants,including applicants who have previously received grants for preliminary development phases or partial grants,to submit new applications for each solicitation to which the applicants are responding, History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.630.Disclosure of applications and other materials submitted to the authority;confidentiality (a)A grant application and other materials submitted to the authority under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695 are subject to disclosure under AS 40.25.100 -40.25.295 (Alaska Public Records Act)and 2 AAC 96,unless the authority determines that the material is protected from disclosure under AS 40.25.120. (b)A person submitting a grant application or other material under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695 may request that the authority keep certain information confidential.The request must (1)clearly designate the specific information to be kept confidential;and (2)specifically describe the basis for asserting that the information is protected from disclosure under AS 40.25.120;if the person believes the information is protected as a trade secret or business proprietary information,the description must include analysis of whether the person's commercial privacy interest in protecting the information from disclosure outweighs the public interest in obtaining the information. Exhibit R-4 Page 19 of 39 (c)If the authority receives a public records request and determines the information requested is protected from disclosure under AS 40.25.120,the authority will not release the information except to authority personnel and contractors for purposes of evaluating the person's application.If the authority determines the information may not be protected from disclosure under AS 40.25.120,the authority will notify the person submitting the information,who is responsible at the person's own expense for seeking judicial relief or taking other action necessary to protect the material from disclosure under AS 40.25.100 -40.25.295. History History:Eff.10/16/2009,Register 192 Annotations Authority:Art.1,sec 22, AK Const. AS 40.25.110 AS 40.25.120 AS 42.45.045 AS 44.83.080 3 AAC 107.635.Acceptance of applications for consideration;eligibility review The authority will accept for consideration,for a recommendation for a grant,each application received on or before the deadline established in the request for applications.The authority will determine if the application is complete,is submitted by an eligible applicant within the meaning given in AS 42.45.045(I) and under 3 AAC 107.610,and is for a project that is eligible under AS 42.45.045(f)-(h)and 3 AAC 107.615.The authority will reject applications that fail to meet those requirements,and will notify each applicant whose application is rejected of the authority's decision. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.645.Feasibility and public benefit review of grant applications (a)For each application not rejected under 3 AAC 107.635,the authority will perform a benefit and feasibility review,in which the authority will review (1)project management,development,and operations,including whether (A)the proposed schedule is clear,realistic,and described in adequate detail; (B)the costs and savings estimates for project development,operation,maintenance,fuel,and other project items are realistic; Exhibit R-4 Page 20 of 39 (C)the project team's method of communicating,monitoring,and reporting development progress is described in adequate detail;and (D)logistical,business,and financial arrangements for operating and selling energy from the completed project are reasonable and described in adequate detail; (2)qualifications and experience,including whether (A)the applicant,partners,and contractors have sufficient knowledge and experience to successfully complete and operate the project; (B)the project team has staffing,time,and other resources to successfully complete and operate the project; (C)the project team is able to understand and address technical,economic,and environmental barriers to successful project completion and operation;and (D)the project uses local labor and trains a local labor workforce; (3)technical feasibility,including whether (A)the renewable energy resource is available on a sustainable basis,and project permits and other authorizations can reasonably be obtained; (B)a site is available and suitable for the proposed energy system; (C)project technical and environmental risks are reasonable; (D)the proposed energy system can reliably produce and deliver energy as planned;and (E)if a demonstration project is being proposed, {i)application in other areas of the state,or another specific benefit of the proposed project,is likely; (ii)the need for the project is shown;and (iii)the risks of the proposed system are reasonable and warrant demonstration;and (4)economic feasibility and benefits,including whether (A}the project is shown to be economically feasible; (B)the project has an adequate financing plan for completion of the grant-funded phase,and has considered options for financing subsequent phases ofthe project;or (C)other public benefits are demonstrated. (b)The authority will reject applications that it determines under (a)of this section not to be technically and economically feasible,or not to provide sufficient public benefit,and will notify each applicant whose application is rejected of the reasons for rejection History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.650.Requests for reconsideration (a)An applicant whose application is rejected in the eligibility review or the feasibility and public benefit review may request that the executive director of the authority reconsider the decision of the authority's staff to reject the application.The request for reconsideration must be in writing,including Exhibit R-4 Page 21 of 39 by electronic mail,must state the basis for reconsideration,and must be received by the authority no more than 10 days after the applicant has been provided written notice of the rejection,including notice by electronic mail. (b)The executive director may concur with the decision of staff and reject the application,request additional information from the applicant before making a decision,or require further consideration of the application under 3 AAC 107.645 or 3 AAC 107.655 if the executive director determines that the authority erred in its rejection of the application. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.655.Evaluation of grant applications (a)For each application not rejected under 3 AAC 107.645,the authority will perform an evaluation for the purpose of ranking applications and making recommendations to the legislature for grants.The evaluation criteria include (1)the extent to which the proposed project serves an area of the state in which the average cost of energy to each resident of the area exceeds the average cost to each resident of other areas of the state;the authority will give the most weight to the criterion in this paragraph; (2)the extent to which the applicant will provide matching resources for the project;the authority will give significant weight to the criterion in this paragraph; (3)the extent to which a grant to the project,considered with other recommended grants,achieves a statewide balance of grant money;the authority will give significant weight to the criterion in this paragraph; (4)the likely economic and technical feasibility of the project;as part of its evaluation under this section, the authority will consider the results of the review performed under 3 AAC 107.645; (5)the public benefits of the project,including economic benefits;as part of its evaluation under this section,the authority will consider the results of the review performed under 3 AAC 107.645; (6)the ability of the applicant to finance,operate,and maintain the project for the life of the project; (7)local support for the project; (8)the readiness of the applicant to proceed with the phases of the project proposed for a grant; (9}the applicant's previous compliance with the requirements of AS 42.45.045,3 AAC 107.600 -3 AAC 107.695,requests for applications,and grant agreements;and (10)other project-specific criteria as identified in the request for applications. (b)As a result of the evaluation under (a)of this section,the authority may recommend a grant in the amount requested by the applicant,decline to recommend a grant for a project,or recommend a grant in an amount or for project phases different from what the applicant requested.In recommending a grant for phases different from what the applicant requested,the authority may limit its Exhibit R-4 Page 22 of 39 recommendation to a grant for one or more preliminary project phases before recommending a grant for project construction. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.660.Ranking of applications (a)To establish a statewide balance of recommended projects,the authority will provide to the advisory committee established in AS 42.45.045(i)a statewide and regional ranking of all applications recommended for grants. (b)In consultation with the advisory committee established in AS 42.45.045(i),the authority will (1)make a final prioritized list of all recommended projects,giving significant weight to providing a statewide balance of grant money,and taking into consideration the amount of money that may be available,number and types of projects within each region,regional rank,and statewide rank; (2)include in the final prioritized list any changes to the recommendations made following the evaluation under 3 AAC 107.655;and (3)include in the final prioritized list a list of applications that were rejected under 3 AAC 107.635 -3 AAC 107.645. (c)The authority will publish the final prioritized list on its website,and will provide it to the legislature in accordance with AS 42.45.045(d}(3).Award of a grant is subject to legislative appropriation. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.670.Additional information from applicant or grantee (a)As it considers necessary to perform a complete review of an application or project,and at any stage in the review,evaluation,recommendation,or award process under 3 AAC 107.600 3 AAC 107.695,the authority will request that an applicant or grantee provide additional information. Requests for information may include a request for information sufficient for the authority to confirm that an (1)application meets the requirements of the request for applications;or (2)applicant or grantee is willing and able to adjust the project scope and budget as required by the authority in making a recommendation or as required by the legislature in approving a grant. Exhibit R-4 Page 23 of 39 (b)If an applicant or grantee fails to provide timely or adequate information in response to a request from the authority,the authority may reject the application,modify the authority's recommendations to the legislature,or cancel a notice of intent to award a grant. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.675.Grant agreement (a)As a condition for a grant under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695,the applicant must sign a grant agreement that the authority prepares and that contains the terms and conditions of the grant,including (1)a description of the project to be financed with the grant; (2)a project schedule;the authority may make one or more disbursements of grant money conditional upon (A)completion and approval by the authority of pre-construction phases ofthe project; (B)the grantee demonstrating that it has site control for the project; (C)the grantee demonstrating that it has one or more permits or authorizations required for construction of the project; (D)the grantee's successful completion of other activities or objectives set under the project schedule; (3)requirements for project management; (4)a description of allowable costs; (S)requirements for the documentation of expenditures and procurements; (6)procedures for making grant payments to the grantee; (7)requirements for the grantee's accounting and reporting; (8)requirements for the grantee's maintenance and retention of project records; (9)hiring preferences applicable under AS 36.10.150 -36.10.180 and 8 AAC 30.064 -8 AAC 30.088 to the grantee and its agents,contractors,and subcontractors; (10)procedures for verifying the provision of the grantee's matching resources to the project;and (11)other terms and conditions that the authority determines are appropriate to ensure the public purpose of and maximize the public benefit from the grant. (b)If an applicant fails to execute the grant agreement within 30 days after receiving it from the authority,the authority may cancel a notice of intent to award the grant and may offer the grant money to another eligible applicant,subject to appropriation and approval by the legislature. History History:Eff.10/16/2009,Register 192 Exhibit R-4 Page 24 of 39 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.680.Grant closeout;return of unexpended grant money Upon completion of the grant-financed or termination of the grant,the authority will close out the grant and the grantee shall return to the authority any grant money and interest on grant money not spent on project work under the terms and conditions of the grant agreement.The grant agreement may provide that specified obligations of the grantee survive grant closeout. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.685.Project operations and maintenance reporting For a project constructed with a renewable energy grant,the grantee shall provide to the authority reports on project operations and maintenance for the periods and with the information that the authority specifies in the grant agreement.The authority may require information on project operations and maintenance activities and cost,other costs of the project,energy output,estimated fuel displacement resulting from the energy output,discussion of operational issues,and other information useful to the authority for its evaluation of the project and the grant.If the grantee fails to provide information as required under this section and in the grant agreement,the authority may determine the grantee ineligible for recommendations for future renewable energy grants or ineligible for other future grants from the authority. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.690.Dispute resolution A person who has a claim concerning a grant awarded under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695 may submit that claim in accordance with 3 AAC 108.915 -3 AAC 108.920. History History:Eff.10/16/2009,Register 192 Exhibit R-4 Page 25 of 39 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 107.695.Definitions for AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695 (a)In AS 42.45.045, (1)"independent power producer”means a corporation,person,agency,authority,or other legal entity or instrumentality,that is not an electric utility and that owns or operates a facility for the generation or production of energy entirely for use by the residents of one or more municipalities or unincorporated communities recognized by the Department of Commerce,Community,and Economic Development for community revenue sharing under AS 29.60.850 -29.60.879 and 3 AAC 180; (2)"wasteheat recovery"means systems for the recovery of unused heat from systems or processes in operation when the applicant applies for a renewable energy grant. (b)In AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695, (1)"matching funds”or "matching resources" (A)means those resources that the grantee dedicates for the completion of the project; (B)includes (i)cash; (ii)loan proceeds;and (iii)grantee-provided equipment,labor,or other materials or services needed for the completion of the project; (2)"preliminary development phase"includes (A)feasibility studies; (B)reconnaissance studies; (C)energy resource monitoring; (D)design phases;and (E)obtaining required permits and authorizations; (3)"renewable energy resources”has the meaning given in AS 42.45.045(1). (c)In 3 AAC 107.600 -3 AAC 107.695,unless the context requires otherwise,"grant"or "renewable energy grant"means a grant recommended or awarded under AS 42.45.045 and 3 AAC 107.600 -3 AAC 107.695. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 Article 5 Emerging Energy Technology Grant Program Exhibit R-4 Page 26 of 39 Section 700.Purpose. 705.Public purpose. 710.Eligible grantees. 715.Eligible projects. 720.Advisory committee. 725.Public notice of application period;solicitation of grant applications. 730.Grant applications. 735.Abstracts. 740.Eligibility review. 745.Review of abstracts. 750.Full proposal. 755.Review of full proposals. 760.Review criteria for full proposals. 765.Reconsideration;abstracts or full proposals. 770.Confidentiality of abstracts,full proposals and other materials submitted to the authority. 775.Additional information from applicant. 780.Grant agreement. 785.Grant closeout;return of unexpended grant money. 790.Reporting on project technology,operations and maintenance. 795.Dispute resolution. 799.Definitions. 3 AAC 107.700.Purpose 3 AAC 107.700 to 3 AAC 107.799 establishes standards and procedures regarding the emerging energy technology fund program and grants under AS 42.45.375.These standards and procedures include criteria for grant applications,the evaluation of applications,the award of grants,the administration of grants,and other matters related to the emerging energy technology fund. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.705.Public purpose Statute text To advance the public purpose of promoting the expansion of energy sources available for residents of the state or to enhance the use of energy in the state,the authority may Exhibit R-4 Page 27 of 39 (1)in consultation with the emerging energy technology advisory committee,establish that certain types of potential projects will receive priority consideration under a solicitation for applications,subject to AS 42.45.375;the public notice for the solicitation must identify and describe any priority consideration for the review of abstracts and full proposals submitted under 3 AAC 107.700 -3 AAC 107.799; (2)solicit,award,or fund grants in phases;recommendations for awarding and funding grants for preliminary development phases may be limited or delayed until the authority determines that subsequent phases of a project are feasible,will result in sufficient benefit to the public,or are otherwise appropriate for the grant;and (3)require a grantee to repay the grant if the grantee sells,conveys,or encumbers a project constructed with grant funds without the prior written approval of the authority. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.710.Eligible grantees (a)To be eligible for an emerging energy technology grant,an applicant must (1)be an eligible applicant under AS 42.45.375;and (2)demonstrate that the applicant will (A)own,operate,and maintain the emerging energy technology project,unless the grantee obtains the authority's consent under (b)of this section; (B)own,lease,or otherwise have adequate legal access to the site upon which the project is located; and (C)provide adequate demonstration of the technology. (b)The authority may consent to a grantee not owning an emerging energy technology project,or not retaining operation or maintenance responsibilities,if the authority determines that conditions imposed or the alternative ownership,operation,or maintenance protects the public interest in and benefit from the grant. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.715.Eligible projects A project is eligible for a grant from the emerging energy technology grant fund if the project meets Exhibit R-4 Page 28 of 39 (1)the requirements of AS 42.45.375(c);and (2)the definition of energy technology under AS 42.45.375(j)(2)and promotes the expansion of energy sources available for residents of the state or enhances the efficient use of energy in the state. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.720.Advisory committee The emerging energy technology fund advisory committee shall (1)advise the authority regarding solicitations for applications,including whether and how certain types of projects should receive priority consideration under a solicitation;and (2)review,advise on ranks,and make recommendations to the authority regarding the quality of abstracts and full proposals. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.725.Public notice of application period;solicitation of grant applications (a)The authority will publish public notice of the application period on the authority's website,and on the Alaska Online Public Notice System.The authority also may publish notice on or through other media outlets. (b)The notice published on the authority's website must request grant applications,and include the date,time,place,and method for delivering applications,and a description of the application requirements. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 Exhibit R-4 Page 29 of 39 3 AAC 107.730.Grant applications The authority under 3 AAC 107.700 -3 AAC 107.799 will process grant applications in two steps.In step one,the authority under 3 AAC 107.735 -3 AAC 107.745 will solicit and review abstracts,and select proposal abstracts for further evaluation.In step two,the authority under 3 AAC 107.750 -3 AAC 107.760 will solicit a full proposal from applicants that submitted abstracts that have been selected for further evaluation.In step two,the authority will also review and evaluate full proposals to determine who will be awarded emerging energy technology grants. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.735.Abstracts (a)The request for grant applications will establish the deadline for submitting abstracts to the authority,the necessary documentation to be included with the abstract,and the format and size for the abstract and documentation.Upon request by the applicant,the executive director may accept an abstract filed after the established deadline only upon finding that extraordinary circumstances caused the delayed delivery and the delay did not give the applicant a substantive advantage.The acceptance or denial must be in writing,and may be given by electronic mail. (b)An abstract must include (1)documentation to establish that the applicant is an eligible applicant under AS 42.45.375(j)(1)and 3 AAC 107.715; (2)a summary of the proposed project,including a description of how the proposed project will (A)test emerging technologies; (B)test methods of conserving energy; (C)improve an existing energy technology;or (D)use an existing technology that has not previously been demonstrated in the state; (3)a description of how the proposed project addresses the priority considerations established by AS 42.45.375(d)and by the request for grant applications; (4)a description of how the proposed project will advance the commercialization of the energy technology not later than the next five years,and the market for purchasing energy generated by the proposed project; (5)statement of the project team's qualifications; (6)a budget for the proposed project; (7)a description of how the proposed project will collect technical and economic data for analysis;and (8)any additional information required in the request for grant applications or under 3 AAC 107.775. (c)The authority may require applicants who have previously received grants from the emerging energy technology fund for preliminary development phases or partial grants,to submit new abstracts for each solicitation for applications. Exhibit R-4 Page 30 of 39 History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.740.Eligibility review The authority will review each timely received abstract,and determine whether the abstract is complete,is submitted by an eligible applicant,relates to an eligible project,and complies with AS 42.45.375 and 3 AAC 107.700 -3 AAC 107.799.The authority will reject abstracts that fail to meet those requirements.The authority will provide written notice to the applicant of the rejection.The notice may be given by electronic mail. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.745.Review of abstracts (a)The authority,in consultation with the emerging energy technology fund advisory committee,will evaluate and rank abstracts not rejected under 3 AAC 107.740 based on how well the proposed project addresses the statutory priorities under AS 42.45.375,and the following criteria: (1)feasibility of the proposed technology; (2)innovation and quality of the technical explanations submitted; (3)how well the proposed project will demonstrate emerging energy technologies,test methods of conserving energy,improve an existing energy technology,or deploy an existing technology that has not previously been demonstrated in the state; (4)how well the proposed project addresses the priority considerations established for projects under the request for grant applications; (5)whether the proposed schedule is realistic; (6)whether the energy technology can be beneficial when deployed in the state; (7)how suitable the proposed project site is; (8)the extent to which existing research and development demonstrates the energy technology and the systems and components included are likely to successfully work in the proposed location and environment in the state; (9)the extent to which the proposed project will advance the commercialization of the energy technology not later than the next five years; (10)capabilities of the project team; Exhibit R-4 Page 31 of 39 (11)potential commercial market for the proposed technology or energy from the proposed technology; and (12)an evaluation of the finance plan and budget for the proposed project. (b)The authority may reject a proposal based upon the review under this section and AS 42.45.375.The authority will provide written notice to the applicant of the rejection.The notice may be given by electronic mail. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.750.Full proposal The authority will select applicants to submit full proposals based on ranking of abstracts and available funding.A full proposal must be submitted not later than the time specified,and include documentation in the format required in the request for full proposals.The full proposal must include (1)a description of the proposed technology,any improvements,or both of current technology; (2)a description of the commercial availability of the proposed technology; (3)a discussion of any intellectual property issues,including (A)ownership; (B)licenses;and (C)agreement for use; (4)a description of the technical components of the proposed project,including (A)key technology elements to be implemented; (B)potential hurdles and how they will be addressed; (C)phasing of the project; (D)deliverables; (E)the data acquisition and management plan;and (F)schedule; (5)the project team and any partnerships with postsecondary institutions in this state,residents of this state,associations,organizations,or manufacturers; (6)the project site,evidence that the applicant has appropriate legal access to the proposed site,and description of why the technology is appropriate for the area that the project will be located; (7)how the proposed project will be integrated in the existing energy system; (8)the potential market and commercialization plan for the proposed project or energy to be generated or transmitted by the project; (9)a complete project budget,including funding requested,the amount and source of matching funding to be provided,and proposed development,operation,and maintenance costs; (10)potential public benefits from the technology and potential for widespread deployment; Exhibit R-4 Page 32 of 39 (11)any regulatory issues specific to the project,the site,the proposed technology,or other matters which could impact the project or public benefits from the project;and (12)any additional information the authority decides it needs to complete its review of the application. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.755.Review of full proposals (a)The authority,in consultation with the emerging energy technology fund advisory committee,will evaluate and rank full proposals using criteria and processes established in 3 AAC 107.760,and AS 42.45.375 and award grants according to ranking of the projects and the criteria established in the solicitation. (b)The authority may ask applicants to make presentations to the authority,authority staff,and emerging energy technology fund advisory committee.During a presentation,the authority,the authority staff and emerging energy technology fund advisory committee members may ask questions concerning the application. (c)As a result of the evaluation under (a)of this section,the advisory committee may recommend the authority award or not award a grant,either in the amount requested by the applicant or a different amount. (d)The authority will determine whether to award or not award a grant.The authority may award a grant for less than the amount requested by the applicant. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.760.Review criteria for full proposals (a)The criteria for reviewing full proposals must include how well the full proposal addresses the statutory priorities at AS 42.45.375,and (1)the feasibility of the proposed technology; (2)the innovation and quality of the technical explanations submitted; (3)how well the proposed project will test emerging energy technologies,test methods of conserving energy,improve an existing energy technology,or deploy an existing technology that has not previously been demonstrated in the state; Exhibit R-4 Page 33 of 39 (4)how well the proposed project addresses the priority considerations established for projects under the request for grant applications; (5)how the proposed project will demonstrate the energy technology; (6)whether the proposed schedule is realistic; (7)whether the energy technology can be beneficial when deployed in the state; (8)how suitable the proposed project site is; (9)the extent to which existing research and development demonstrates the energy technology and the systems and components included are likely to successfully work in the proposed location and environment in the state; (10)the extent to which the proposed project will advance the commercialization of the energy technology not later than the next five years; (11)the capabilities of the project team; (12)the potential commercial market for the proposed technology or energy from the technology; (13)an evaluation of the finance plan and budget for the proposed project;and (14)whether all regulatory and legal issues have been adequately addressed. (b}The authority may reject a full proposal based upon the review under this section and AS 42.45.375. The authority will provide written notice to the applicant of the rejection.The notice may be given by electronic mail. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.765.Reconsideration;abstracts or full proposals (a)An applicant who believes an error was made when its abstract or full proposal was rejected or ranked may request reconsideration to the executive director of the authority.The request for reconsideration must be in writing,must state the error made during the review,and must be received by the authority no more than 10 days after the notice of rejection or ranking. (b)The executive director on reconsideration may accept or overturn the decision made during the review of the abstract or full proposal,or request additional information from the applicant before making a decision.If the executive director overturns the decision,the authority shall further consider the abstract under 3 AAC 107.740 and 3 AAC 107.745 or the full proposal under 3 AAC 107.750 -3 AAC 107.760.The decision of the executive director on reconsideration is the final agency decision.If the executive director fails to issue a decision not later than 30 days,the request for reconsideration is denied. History History:Eff.1/26/2012,Register 201 Exhibit R-4 Page 34 of 39 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.770.Confidentiality of abstracts,full proposals and other materials submitted to the authority (a)An abstract,full proposal,and other materials submitted to the authority under AS 42.45.375 and 3 AAC 107.700 -3 AAC 107.799 are records subject to AS 40.25.100 -40.25.295 (Alaska Public Records Act) and 2 AAC 96,and may be disclosed to the public unless the records are confidential or otherwise protected from disclosure under AS 40.25.120 or other applicable law. (b)A person submitting an abstract,full proposal,or other material under AS 42.45.375 and 3 AAC 107.700 -3 AAC 107.799 may request that certain information be kept confidential.The request must (1)clearly designate the specific information to be kept confidential;and (2)specifically describe the basis for asserting that the information is protected from disclosure under AS 40.25.120;if the person believes the information is protected as a trade secret or business proprietary information,the description must include analysis of whether the person's commercial privacy interest in protecting the information from disclosure outweighs the public interest in obtaining the information. (c)If the authority determines the records submitted do not appear to be confidential or otherwise protected from disclosure under AS 40.25.100 -40.25.295 (Alaska Public Records Act),the authority will notify the applicant so that the applicant may request to withdraw all or parts of the abstract or full proposal. (d)If the authority agrees that records received from a grantee appear to be confidential or otherwise protected from disclosure under AS 40.25.100 -40.25.295 (Alaska Public Records Act),the authority will agree in the grant agreement to notify the applicant if the authority receives a public records request so that the applicant may seek judicial relief or take other action necessary to protect the records from disclosure. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.775.Additional information from applicant {a)The authority may require the applicant or grantee to provide additional information which the authority considers necessary or desirable to complete review of an abstract,a full proposal,or during project operation and maintenance reporting required under 3 AAC 107.790.The authority may require the additional information and at any stage in the review,evaluation,or award process.Required additional information may include information sufficient for the authority to confirm that (1)an application meets the requirements for abstracts and full proposals;or Exhibit R-4 Page 35 of 39 (2)an applicant or grantee is willing and able to adjust the project scope and budget as required by the authority in awarding a grant. (b)If an applicant or grantee fails to provide timely or adequate information required by the authority, the authority may reject the abstract or full proposal,modify the grant award,or cancel an award of a grant. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.780.Grant agreement (a)Before the authority may disburse any grant funds,the applicant must sign a grant agreement acceptable to the authority.The grant agreement must contain the terms and conditions of the grant, including (1)a description of the project; (2)a project schedule; (3)a grant fund disbursal schedule that addresses disbursement upon the grantee achieving milestones including (A)completion and approval by the authority of pre-construction phases ofthe project; (B)the grantee demonstrating that it has site contro!for the project; (C)the grantee demonstrating that it has required permits or authorizations for construction of the project; (D)the grantee demonstrating that it has obtained the required intellectual property rights or licensing for the project;and (E)the grantee's successful completion of activities or objectives set under the project schedule; (4)requirements for project management; (5)a description of allowable costs; (6)requirements for the documentation of expenditures and procurements; (7)procedures for making grant payments to the grantee; (8)requirements for the grantee's accounting and reporting; (9)requirements for the grantee's maintenance and retention of project records; (10)hiring preferences applicable under AS 36.10.150 -36.10.180 and 8 AAC 30.064 -30.088 to the grantee and its agents,contractors,and subcontractors; (11)procedures for verifying the provision of the grantee's matching contributions to the project; (12)requirements for providing information on project operations and maintenance activities and costs, other costs of the project,energy output,estimated fuel displacement resulting from the energy output, operational issues,and other project elements and outputs useful to the authority for its evaluation of the project and the grant; Exhibit R-4 Page 36 of 39 (13)the grantee's agreement to allow access to the project site and project data by a third party chosen by the authority to verify the reporting submitted by the grantee;and (14)other terms and conditions that the authority determines are appropriate to ensure the public purpose of and maximize the public benefit from the grant. (b)If an applicant fails to execute the grant agreement not later than 30 days after receiving the agreement from the authority,the authority may cancel a grant award and may offer the grant funds to another eligible applicant. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.785.Grant closeout;return of unexpended grant money Upon completion ofthe grant project,or termination of the grant,the authority will close out the grant and the grantee shall return to the authority any grant funds not spent on project work under the terms and conditions of the grant agreement and any earnings on grant money.The grant agreement may provide that specified obligations of the grantee survive grant closeout. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.790.Reporting on project technology,operations and maintenance The grantee must provide the authority with technical and economic data,project and budget reports, and other technology validation information appropriate to the project which the authority specifies in the grant agreement.The grantee must use data collection designs and processes to capture performance information and validate the demonstrated technology as determined by the authority. The authority may use third party agents to receive and analyze data from the grantee.If the grantee fails to cooperate in providing information and data required under this section and in the grant agreement,the authority may cancel the project,require reimbursement of grant funds,determine the grantee ineligible for future emerging energy technology fund grants or other grants from the authority, or take a combination of these actions. History History:Eff.1/26/2012,Register 201 Exhibit R-4 Page 37 of 39 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.795.Dispute resolution A person who has a claim concerning a grant awarded under AS 42.45.375 and 3 AAC 107.700 -3 AAC 107.799 may submit that claim in accordance with 3 AAC 108.915 -108.920. History History:Eff.1/26/2012,Register 201 Annotations Authority:AS 42.45.375 AS 44.83.080 3 AAC 107.799.Definitions (a)In 3 AAC 107.700 -3 AAC 107.799,unless the context requires otherwise, (1)"advisory committee"means the emerging energy technology advisory committee; (2)"emerging energy technology”has the same meaning given "energy technology”in AS 42.45.375(j)(2); (3)"emerging energy technology advisory committee"means the advisory committee established under AS 42.45.375(f); (4)"emerging energy technology grant"means a grant awarded under AS 42.45.375 and 3 AAC 107.700 -3 AAC 107.799; (5)"grant”means an emerging energy technology grant; (6)"grant funds"means amounts awarded as grants from the emerging energy technology fund under AS 42.45.375; (7)"preliminary development phase"includes (A)feasibility studies; (B)reconnaissance studies; (C)energy resource monitoring; (D)design phases;and (E)obtaining required permits and authorizations. (b)In AS 42.45.375,"matching funds"or "matching resources"means those resources that the grantee dedicates for the completion of the project;"matching funds"or "matching resources"includes (1)cash; (2)loan proceeds;and (3)grantee-provided equipment,labor,materials,or services needed for completion of the project. History History:Eff.1/26/2012,Register 201 Exhibit R-4 Page 38 of 39 Annotations Authority:AS 42.45.375 AS 44.83.080 Article 6 General Provisions Section 990.Definitions. 3 AAC 107.990.Definitions in 3 AAC 107,unless the context requires otherwise, (1)deleted; (2)deleted; (3)"fiscal year"means the state fiscal year; (4)repealed 11/25/94; (5)deleted; (6)"authority"means the Alaska Energy Authority created under AS 44.83.020. History History:Eff.6/29/94,Register 131;am 11/25/94,Register 132;am 2/16/96,Register 137 Annotations Authority:AS 44.83.080 Exhibit R-4 Page 39 of 39 Exhibit R-5 Chapter 108 Financial and Technical Assistance for Energy Systems,Facilities,and Equipment Article 1.Bulk Fuel Storage Facility and Power System Upgrades.(3 AAC 108.100 -3 AAC 108.130) 2.Circuit Rider Maintenance and Electrical Emergencies Programs.(3 AAC 108.200 -3 AAC 108.240) 3.Alternative Energy and Energy Efficiency Programs.(3 AAC 108.300 -3 AAC 108.320) 4.Village Energy Efficiency Program.(3 AAC 108.400 -3 AAC 108.499) 5.Commercial Building Energy Audit Program.(3 AAC 108.500 -3 AAC 108.590) 6.General Provisions.(3 AAC 108.900 -3 AAC 108.990) Article 1 Bulk Fuel Storage Facility and Power System Upgrades Section 100.Bulk fuel storage facility and power system upgrade assistance provided by the authority. 110.Eligibility for and authority prioritization of assistance. 120.Conditions to receiving assistance. 130.Phased approach to assistance. 3 AAC 108.100.Bulk fuel storage facility and power system upgrade assistance provided by the authority Subject to the availability of appropriations,the authority may provide financial assistance and technical assistance,including construction management and training,to recipients eligible for bulk fuel storage facility and power system upgrade assistance. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 3 AAC 108.110.Eligibility for and authority prioritization of assistance (a)Utilities,municipalities,school districts,unincorporated villages,community associations,Native corporations,councils organized under 25 U.S.C.476,traditional councils,and other persons providing power or fuel to the public in one or more communities are eligible for assistance under 3 AAC 108.100 - 3 AAC 108.130. (b)To prioritize its assistance for bulk fuel storage facility upgrades,the authority will evaluate and rank deficiencies and needs for upgraded community bulk fuel storage facilities in each community in the state that Exhibit R-5 Page 1 of 25 (1)has a population of at least 20 but less than 2,000; (2)is not predominantly a military or industrial site; (3)has significant bulk fuel storage needs;and (4)is either located off an interconnected road system or,if located on an interconnected road system, is more than 20 miles from Anchorage,Fairbanks,Juneau,Kenai,Ketchikan,Kodiak,Nikiski,Sitka, Soldotna,Valdez,or another major fuel distribution center. (c)To prioritize its assistance for power system upgrades,the authority will evaluate and rank deficiencies and needs for upgraded community power systems in each community in the state that (1)has a population of at least 20 but less than 2,000; (2)is not predominantly a military or industrial site; (3)has a central community power system;and (4)is not connected to the Railbelt (Homer-Seward-Anchorage-Fairbanks),Four Dam Pool (Glenallen- Valdez,Wrangell-Petersburg,Ketchikan,Kodiak),or Juneau power distribution systems. (d)The authority may reevaluate and modify its evaluations and rankings based on changed assumptions or new information.The authority will publish and periodically update its rankings on its Internet web site. (e)In providing assistance under 3 AAC 108.100 -3 AAC 108.130,the authority will give priority to those communities found in the authority's evaluations and rankings under (b)and (c)of this section to have the greatest needs for assistance.The authority may revise its prioritization based on (1)requirements of federal or state agencies or other entities providing money; (2)the authority's determination of a recipient's readiness to proceed with the project; (3)the recipient's ability to meet conditions for assistance under 3 AAC 108.120;or (4)cost-effectiveness factors. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 3 AAC 108.120.Conditions to receiving assistance As a condition to providing assistance under 3 AAC 108.100 -3 AAC 108.130,the authority will require the recipient to (1)execute a grant agreement prepared by the authority that describes the terms and conditions of the assistance; (2)execute a waiver of any sovereign immunity; (3)provide a business plan or other documentation demonstrating to the satisfaction of the authority the recipient's ability to operate and maintain the facility for the public benefit for the facility's useful life and to replace the facility at the end ofthe facility's useful life; (4)provide a cash match,property,services or another form of contribution to the project; (5)establish that the recipient has title to or a leasehold interest in the site on which the facility is located;and Exhibit R-5 Page 2 of 25 (6)comply with other terms and conditions that the authority determines are needed to maximize the public benefit from the assistance provided. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 3 AAC 108.130.Phased approach to assistance The authority may employ a phased approach to providing assistance under 3 AAC 108.100 -3 AAC 108.130,including providing assistance for a conceptual design or other planning documents to determine whether to provide additional assistance. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 Article 2 Circuit Rider Maintenance and Electrical Emergencies Programs Section 200.Purpose of circuit rider maintenance and electrical emergencies programs. 210.Eligibility and selection for circuit rider assistance. 220.Circuit rider assistance provided by the authority. 230.Electrical emergency assistance provided by the authority. 240.Conditions to receiving assistance. 3 AAC 108.200.Purpose of circuit rider maintenance and electrical emergencies programs (a)The purpose of the circuit rider maintenance program under 3 AAC 108.200 -3 AAC 108.220 is to assist eligible utilities to improve the efficiency,safety,and reliability of power systems and reduce the risk and severity of emergency conditions or emergency disruptions in the operation of community power systems,by providing training,consultation,on-site assistance with maintenance and minor repairs,and other technical assistance. (b)The purpose of electrical emergency assistance under 3 AAC 108.230 is to assist eligible utilities in responding to emergencies that affect their ability to reliably generate and transmit power,by providing financial or technical assistance in response to emergency conditions or emergency disruptions in the operation of community power systems. Exhibit R-S Page 3 of 25 History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (Apri!2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6},to the authority citation that follows 3 AAC 108.200,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. 3 AAC 108.210.Eligibility and selection for circuit rider assistance (a)At the beginning of each fiscal year,to prioritize its circuit rider assistance for that year,the authority will evaluate and rank deficiencies and needs for circuit rider assistance that year (1)for a utility that serves a community in this state that (A)has a population of at least 20 but less than 2,000; (B)is not predominately a military or industrial site; (C)has a central community power system; (D)is not connected to a power distribution system identified in 3 AAC 108.110(c)(4);and (E)is located off an interconnected road system;and (2)so that the ranking corresponds to the ranking under 3 AAC 108.110(c)for power system upgrade assistance to the community served by the utility,with modifications to that ranking as the authority considers necessary to address (A)The authority's assessment under 3 AAC 108.220 (b)ofthe utility's major needs and the authority's ability to provide assistance for those needs; (B)the risk of catastrophic system failure; (C)the utility's management practices and operations; (D)the utility's maintenance practices; (E)the utility's ability to obtain and pay for assistance from other sources;and (F)how recently the utility received circuit rider assistance from the authority. (b)The authority will respond to requests for circuit rider assistance from eligible utilities taking into account the prioritization under (a)of this section,the availability of appropriations,and the authority's ability to efficiently administer circuit rider assistance,including its ability to provide assistance in multiple communities during one circuit rider trip. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Exhibit R-5 Page 4 of 25 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to the authority citation that follows 3 AAC 108.210,so that the citation to former AS 42.45.400 now refers to the renumbered statute, AS 42.45.900. 3 AAC 108.220.Circuit rider assistance provided by the authority Circuit rider assistance may include one or more visits to the community whose utility is selected to receive assistance or it may be limited to assistance provided telephonically or by electronic mail.The circuit rider assistance to be provided will be determined based on the authority's assessment,in consultation with the utility,of the utility's major needs and the authority's ability to provide assistance for those needs.Assistance that the authority may provide includes (1)review of and recommendations to improve the system condition and system operations and maintenance; (2)training utility personnel;and (3)performing,or assisting utility personnel in their performance of,minor maintenance and repairs. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to the authority citation that follows 3 AAC 108.220,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. 3 AAC 108.230.Electrical emergency assistance provided by the authority (a)If a utility eligible under 3 AAC 108.210 suffers an electrical emergency,the authority will,subject to the availability of appropriations,assist the utility in responding to the emergency and recovering the ability to generate and transmit power to the utility's customers in a manner that does not constitute a significant threat to life or property.Assistance may include financial assistance or technical assistance, including emergency repairs. (b)In this section,"electrical emergency"means a condition in a utility's system that presents an imminent danger to life or likelihood of significant disruption of electrical service. History History:Eff.3/25/2005,Register 173 Exhibit R-5 Page 5 of 25 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to the authority citation that follows 3 AAC 108.230,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. 3 AAC 108.240.Conditions to receiving assistance As a condition to providing assistance under 3 AAC 108.200 -3 AAC 108.240,the authority will require the recipient to: (1)execute an agreement prepared by the authority that describes the terms and conditions of the assistance; (2)execute a waiver of any sovereign immunity;and (3)comply with other terms and conditions that the authority determines are needed to maximize the public benefit from the assistance provided. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to the authority citation that follows 3 AAC 108.240,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. Article 3 Alternative Energy and Energy Efficiency Programs Section 300.Alternative energy and energy efficiency assistance provided by the authority. 310.Alternative energy and energy efficiency assistance plan. 320.Conditions for receiving assistance. 3 AAC 108.300.Alternative energy and energy efficiency assistance provided by the authority (a)Subject to the availability of appropriations,the authority may provide financial and technical assistance to utilities,municipalities,schools districts,unincorporated villages,community associations, Native corporations,councils organized under 25 U.S.C.476,traditional councils,and businesses for Exhibit R-5 Page 6 of 25 evaluation and development of sources of energy in the state for local consumption and for evaluation, development,and installation of measures to improve the efficient utilization of energy that is consumed locally. (b)In providing assistance under 3 AAC 108.300 -3 AAC 108.320,the authority will give priority to those projects that show the greatest potential for reducing communities'dependence on diesel fuel for power generation. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 3 AAC 108.310.Alternative energy and energy efficiency assistance plan The authority will prepare,publish on its Internet web site,and periodically update a biennial plan for providing alternative energy and energy efficiency assistance under 3 AAC 108.300 -3 AAC 108.320.In the plan the authority will include a description of available money and money the authority plans to request for alternative energy and energy efficiency assistance,the types of assistance the authority provides and plans to provide,and the criteria for allocating money that the authority uses and plans to use. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 3 AAC 108.320.Conditions for receiving assistance As a condition to providing assistance under 3 AAC 108.300 -3 AAC 108.320,the authority will require the recipient to (1)execute a grant agreement prepared by the authority that describes the terms and conditions of the assistance; (2)execute a waiver of any sovereign immunity; (3)provide a cash match,property,services or another form of contribution to the project;and (4)comply with other terms and conditions that the authority determines are needed to maximize the public benefit from the assistance provided. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 44.83.080 Exhibit R-5 Page 7 of 25 Article 4 Village Energy Efficiency Program Section 400.Purpose. 410.Eligible communities and applicants. 420.Eligible projects. 430.Public notice of application period;solicitation of grant applications. 440.Grant applications. 450.Evaluation of grant applications. 460.Grant agreement. 470.Project implementation. 480.Grant closeout. 490.Reconsideration. 499.Definitions. 3 AAC 108.400.Purpose Subject to the availability of appropriations,the authority may provide financial assistance under 3 AAC 108.400 -3 AAC 108.499 (village energy efficiency program)to eligible applicants representing eligible communities to conduct energy audits,implement cost-saving energy efficiency improvements in public buildings and facilities,and implement conservation programs. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.410.Eligible communities and applicants (a)A community with a population not greater than 8,000 residents is eligible for a village energy efficiency program grant. (b)An applicant committed to representing the interests of the entire community in developing an effective work plan and implementing energy efficiency and conservation measures to maximize cost savings from the community's use of electricity and heating energy is eligible to apply for and receive a village energy efficiency program grant.Eligible applicants may include municipalities,school districts, unincorporated villages,Native corporations,tribal consortiums recognized as nonprofit entities under 26 U.C.S.501(c)(3),regional housing authorities,councils organized under 25 U.S.C.476,and traditional councils. History History:Eff.6/30/2013,Register 206 Exhibit R-5 Page 8 of 25 Annotations Authority:AS 44.83.080 3 AAC 108.420.Eligible projects Village energy efficiency program grant money may be used for the following types of energy efficiency and conservation projects: (1)energy efficiency audits of public buildings and facilities;not more than 30 percent of the grant money may be used for energy efficiency audits; (2)energy efficiency improvements to public buildings and facilities,including those affecting the (A)thermal envelope;improvements affecting the thermal envelope include installing insulation or weather sealing,and replacing windows and doors; (B)heating,domestic hot water,air conditioning,or ventilation systems; (C)lighting systems and controls,both indoor and outdoor;and (D)other electrical load of the building or facility,including motors,pumps,water heaters,heat trace timers,occupancy sensors,other control equipment,exit signs,refrigeration,appliances,and other electric loads; (3)Implementation of energy conservation measures using no more than $10,000 of the total grant award,and limited to the following activities: (A)establishing workplace policies or programs for employees regarding the conservation of energy; (B)designing and adopting public building and public facility energy conservation programs; (C)conducting public education to increase community participation in conservation activities and implementation of efficiency measures. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.430.Public notice of application period;solicitation of grant applications (a)The authority will publish public notice of the application period on the authority's website,and on the Alaska Online Public Notice System (AS 44.62.175).The authority may also publish notice on or through other media outlets. (b)In the public notice,the authority will request grant applications and include a description of the application requirements,including the date,time,place,and method for submitting applications to the authority. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 Exhibit R-5 Page 9 of 25 3 AAC 108.440.Grant applications (a)A grant application must include (1)the applicant's name and type of entity: (2)the name of the community the applicant represents; (3)a statement from the applicant of community support for the applicant to represent the community related to the village energy efficiency program grant; (4)a description of proposed community matching resources,and a demonstration of the ability of the applicant and community to supply those contributions;and (5)a statement of the applicant's commitment to diligently work with other members of the community and the authority to ensure all project components are completed; (A)to maximize cost savings from the community's use of electricity and heating energy;and (B)in a timely,efficient and cost effective manner,including providing regularly required reports to the authority. (b)A grant application may include a statement of the applicant's intended purposes for the grant,to the extent known,including identification of (1)the public buildings and facilities that may become a subject of a grant project; (2)energy conservation programs that may become a subject of a grant project;and (3)other energy,energy efficiency,or energy conservation programs,or other community activities that the applicant believes would promote cost efficiencies if done in conjunction with a village energy efficiency program grant. (c)If requested by the authority,an eligible applicant must provide additional information to enable the authority to evaluate the application.Required additional information may include community information regarding energy cost and demand,prior financial assistance for energy efficiency or conservation efforts,and other pertinent information. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.450.Evaluation of grant applications (a)The authority will evaluate and rank grant applications,with priority given to applications representing eligible communities based upon each of the following criteria: (1)the cost of electricity and heating energy in the community; (2)the demand for energy in the community due to climate; (3)whether or how recently financial assistance from state or federal agencies has been provided to implement end-use energy efficiency measures in public buildings and facilities in the eligible community; (4)the amount of community matching resources offered to support the grant project; (5)whether cost efficiencies may be achieved by awarding and implementing a village energy efficiency program grant in conjunction with another energy,energy efficiency,or energy conservation program, Exhibit R-5 Page 10 of 25 or in conjunction with the timing of other community activities,such as replacement schedules for large pieces of community equipment; (6)the equitable geographic-and population-based distribution of village energy efficiency program grants,evaluated based upon the distribution of grants over the prior five years; (7)the administrative capability of the applicant,including past performance on any previous grant awards. (b)If more than one eligible applicant representing an eligible community submits an application to receive a village energy efficiency program grant,the authority will award not more than one grant with respect to the community.To evaluate the multiple applications with respect to the community,the authority may meet with the eligible applicants and with other members of the community.Nothing in this subsection precludes competing eligible applicants and the community from agreeing to cooperatively develop and implement a grant project. (c)The authority,before approving an application between competing eligible applicants,will consider factors relevant to achieving the purposes of the grant,including the (1)ability of each applicant to represent the interests of the whole community to develop an effective work plan and implement energy efficiency and conservation measures to maximize cost savings from the community's use of electricity and heating energy; (2)views of members of the community respecting the competing applications; (3)ability of each eligible applicant to manage its debt and other finances;and (4)administrative capability of each eligible applicant,including past performance on any previous grant awards. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.460.Grant agreement (a)Before the authority will disburse any grant money,the applicant must sign a grant agreement containing the terms and conditions of the grant.A grant agreement must contain the terms and conditions of the grant,including (1)the identity of the community the applicant represents; (2)a statement whether the project will include an energy audit; (3)a project work-plan,approved by the authority,that includes (A)a description of the project,including the energy efficiency improvements to be made to specified public buildings and facilities,and any energy conservation measures to be implemented; (B)activities to coordinate project planning with members of the community; (C)a project schedule; (D)a project completion deadline;the deadline must be approximately three years from the date of the first disbursement of grant money; (E)a complete project budget from all funding sources,including community matching resources; Exhibit R-5 Page 11 of 25 (F)identification of allowable project costs; (G)a statement whether the authority will procure a third-party service provider to perform the project work and meet reporting requirements,or whether the grantee will administer the project;and (H)reporting requirements for technical and economic data,project and budget reports,and actual energy use data; (4)identification of community matching resources and procedures for verifying those contributions; (5)requirements for the documentation of expenditures and procurements; (6)requirements for the grantee's maintenance and retention of project records; (7)a waiver of sovereign immunity from suit for claims related to the grant award,on a form approved by the Department of Law;and (8)other terms and conditions that the authority determines are appropriate to ensure the public purpose of,and maximize the public benefit from,the grant. (b)The authority will require an energy audit be conducted before approving a project work plan under (a)(3)of this section unless (1)within the prior three years,an American Society of Heating,Refrigerating and Air-Conditioning Engineers Level Il or higher energy audit has been conducted on the public buildings and facilities in the eligible community; (2)the applicant is proposing to implement a street light retrofit or another specific energy measure that would not require an audit to determine estimated savings; (3)the authority determines that other special circumstances related to the proposed grant project exist so that conducting an energy audit is not necessary to promote the purposes of the village energy efficiency program. (c)When the grant project includes an energy audit,the project work plan under (a)(3)of this section may be initially limited to activities,schedules,and budget regarding the energy audit.The process for conducting the energy audit will be used to develop the project work plan.The authority will not disburse additional grant money until the grant agreement is amended to incorporate a work plan, approved by the authority,for implementing the remainder of the grant project. (d)The authority may meet with the applicant and with other members of the community before signing the grant agreement to help ensure that terms and conditions of the grant meet the interests of the community. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.470.Project implementation (a)The village energy efficiency program projects will generally be administered by the authority. Except as provided in (b)of this section,after approving the grant application,the authority will contract with third-party service providers to implement the grant project. Exhibit R-5 Page 12 of 25 (b)The authority may allow the grantee,upon request,to implement the grant project if the authority determines the grantee has previously successfully managed and reported on projects of comparable size and complexity,and demonstrates current capacity to successfully manage and report on the grant project. (c)The grantee or the third-party service provider that is implementing the grant project shall be responsible for (1)coordinating project planning with the grantee and members of the community,including assisting with the determination of the most cost-effective energy efficiency and conservation measures to implement; (2)if included in the grant project,conducting an energy audit for the community; (3)implementing energy efficiency upgrades,including contracting and installation; (4)project administration;and (5)reporting to the authority;reporting may include technical and economic data,project and budget reports and actual energy use data. (d)Nothing in 3 AAC 108.400 -3 AAC 108.499 prohibits a grantee or third-party service provider implementing a grant project in a community from offering to provide similar services to persons within the community for buildings and facilities that are not included in the grant project or do not qualify for the program,such as buildings used by private organizations or businesses.The grantee or third-party service provider may not use grant money for their time or materials related to these non-grant efforts, but may offer to provide cost efficiencies that arise from implementing a grant project. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.480.Grant closeout Upon completion of the grant project,or termination of the grant,the authority will close out the grant and the grantee shall return to the authority any grant money not spent on project work under the terms and conditions of the grant agreement. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.490.Reconsideration (a)An applicant whose grant application is denied may request reconsideration to the executive director of the authority.The request for reconsideration must be in writing,must state the basis for reconsideration,and must be received by the authority not more than 10 days after denial. Exhibit R-5 Page 13 of 25 (b)The executive director on reconsideration may accept or overturn the decision to deny the grant application,or request additional information from the applicant before making a decision.The decision of the executive director on reconsideration is the final agency decision.If the executive director fails to issue a decision within 30 days,the request for reconsideration is considered denied,unless the executive director extends the time for reconsideration. History History:Eff.6/30/2013,Register 206 Annotations Authority:AS 44.83.080 3 AAC 108.499.Definitions In 3 AAC 108.400 -3 AAC 108.499,unless the context requires otherwise, (1)"American Society of Heating,Refrigerating and Air-Conditioning Engineers Level Il or higher energy audit"means an energy audit that complies with guidance provided by the American Society of Heating, Refrigerating and Air-Conditioning Engineers in the publication Procedures for Commercial Building Energy Audits,Second Edition (2011),adopted by reference,for a Level Il or higher energy audit; (2)"community"means a municipality or unincorporated village in which 25 or more individuals reside as a social unit; (3}"end-use energy efficiency measure" (A)means an improvement made to a building or facility that incorporates a technology or building practice that improves the energy efficiency of that building or facility; (B)includes lighting retrofits,increased insulation,weather stripping,and automated controls; (C)does not include behavior change programs or other conservation measures; (4)"grant"or "village energy efficiency program grant”means a grant awarded under 3 AAC 108.400 -3 AAC 108.499; (5)"grant money"means amounts awarded as grants under the village energy efficiency program; (6)"matching funds"or "matching resources" (A)means those resources that the grantee dedicates for the completion of the project; (B)includes (i)cash; (ii)loan proceeds;and (iii)grantee-provided and documented equipment,labor,or other materials or services needed for the completion of the project; (7)"public building and facility"means a building or other infrastructure that consumes electricity or heating energy,is open to the general public,and is used by the community;in this paragraph,"other infrastructure"includes water systems and street or community outdoor lighting. History History:Eff.6/30/2013,Register 206 Exhibit R-5 Page 14 of 25 Annotations Authority:AS 44.83.080 Editor's note:A copy of the American Society of Heating,Refrigerating and Air-Conditioning Engineers publication Procedures for Commercial Building Energy Audits,adopted by reference in 3 AAC 108.499, is available for inspection at the offices of the Alaska Energy Authority,813 West Northern Lights Boulevard,Anchorage Alaska 99503.A copy of the publication may also be obtained from the American Society of Heating,Refrigerating and Air-Conditioning Engineers at ASHRAE Headquarters,1791 Tullie Circle,N.E.,Atlanta,GA 30329,and at https://www.ashrae.org/resources-publications/book- store/procedures-for-commercial-building-energy-audits. Article 5 Commercial Building Energy Audit Program Section 500.Purpose. 510.Eligible applicants. 520.Eligible energy audit. 525.Grant amount. 530.Public notice of application period;solicitation of applications. 540.Grant application. 550.Grant evaluation. 560.Grant award and notice to proceed. 570.Project implementation. 580.Reconsideration. 590.Definitions. 3 AAC 108.500.Purpose Subject to the availability of appropriations,the authority may provide financial assistance under 3 AAC 108.500 -3 AAC 108.590 (commercial building energy audit program)to reimburse the owners of commercial buildings in the state for the cost of energy audits of their commercial buildings. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.510.Eligible applicants Any non-public owner of a commercia!building located in the state may apply for and receive a grant for reimbursement of up to the full cost of a commercial energy audit under 3 AAC 108.500 -3 AAC Exhibit R-5 Page 15 of 25 108.590.An eligible applicant may operate the applicant's commercial building on either a for-profit or non-profit basis. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.520.Eligible energy audit A commercial building energy audit program grant may be awarded to an eligible applicant for up to the total cost of a commercial building energy audit that (1)meets or exceeds the standards of an American Society of Heating,Refrigerating and Air- Conditioning Engineers Level Il or higher energy audit;and (2)is administered by an Association of Energy Engineers certified energy auditor or certified energy manager,or authority-approved equivalent. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.525.Grant amount (a)The amount of an approved grant will be determined under the schedule in this subsection based on the square feet of building size and whether the building has heating only or has heating,ventilation, and air conditioning,with adjustments the authority makes under (b)of this section: Building Buildings with heating, with heating ventilation,and air Square feet only conditioning Not more than 2,500 $1,800 $2,100 Not more than 5,000 $1,950 $2,325 Not more than 10,000 $2,300 $2,750 Not more than 15,000 $2,650 $3,175 Not more than 20,000 $3,000 $3,600 Not more than 30,000 $3,700 $4,450 Not more than 40,000 $4,400 $5,300 Not more than 50,000 $5,100 $6,150 More than 50,000 $5,800 $7,000 Exhibit R-5 Page 16 of 25 (b)The authority may adjust as follows the grant amount determined under the schedule in (a)of this section: (1)the actual amount of any grant may not exceed the actual cost of the energy audit; (2)the amount of a grant may be increased to include reimbursement of up to the actual cost of travel required to complete the energy audit if an Association of Energy Engineers certified energy auditor or certified energy manager,or authority-approved equivalent,is not available within 100 miles by road or the Alaska marine highway system of the applicant's commercial building; (3)the amount of a grant may be decreased based upon the level of program funding available. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.530.Public notice of application period;solicitation of applications (a)The authority will publish public notice of the application period on the authority's website,and on the Alaska Online Public Notice System (AS 44.62.175).The authority may also publish notice on or through other media. (b)In the public notice,the authority will request applications and include a description of the application requirements,including the date,time,place,and method for submitting applications to the authority. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.540.Grant application The authority will require the applicant to provide the following documents and information regarding the commercial building: (1)proof of private ownership and site control; (2)utility bills for the prior 12 months'energy use,or self-reported statements certified by the applicant if utility bills are not available; (3)building location and size; (4)building type as described in 3 AAC 108.550(c); (S)a statement of commitment to implementing some or all efficiency and conservation measures that are recommended by the energy audit and that are determined economic by the applicant. History History:Eff.9/25/2013,Register 207 Exhibit R-5 Page 17 of 25 Annotations Authority:AS 44.83.080 3 AAC 108.550.Grant evaluation (a)The authority will evaluate and rank grant applications,with priority for funding based upon each of the following criteria: (1)whether the applicant and commercial building meet the eligibility requirements; (2)the annual energy use intensity of the commercial building,as described in (c)of this section; (3)geographical distribution of grants; (4)whether cost savings and efficiencies may be obtained if the energy audit is conducted in conjunction with another state program because the commercial building is located in a community where one or more Association of Energy Engineers certified energy auditors or certified energy managers or authority-approved equivalents will travel under 3 AAC 108.400 -3 AAC 108.499 (village energy efficiency program)or another state program. (b)To the extent applicants are evenly ranked under (a)of this section,grants will be awarded ona first-come,first-served basis. (c)The authority will determine a commercial building's annual energy use intensity by evaluating the amount of energy used by a building on a per square foot basis.The authority will give priority to an applicant whose commercial building uses more energy per square foot compared to commercial buildings of other applicants within the same category of building type.The authority will classify a commercial building into one ofthe following five categories of building type,with each individual building type defined as set out in the building type definitions section of the Commercial Building Energy Consumption Survey: (1)food sales,food service,and inpatient healthcare; (2)lodging,public assembly,outpatient healthcare,and office; (3)mercantile,service,and education; (4)religious worship,and warehouse and storage; (5)other. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.560.Grant award and notice to proceed The authority will send a notice to proceed after an applicant has been selected for a grant. History History:Eff.9/25/2013,Register 207 Exhibit R-5 Page 18 of 25 Annotations Authority:AS 44.83.080 3 AAC 108.570.Project implementation The grant recipient is responsible for each of the following project activities after receiving a notice to proceed: (1)hiring an energy auditor and notifying the authority of the name and estimated date of the energy audit; (2)being present for the energy audit; (3)providing utility bill data and building use information; (4)ensuring completion of the energy audit in a reasonable amount of time; (5)paying the energy auditor after acceptance of the auditor's invoice; (6)ensuring that the auditor submits by electronic mail the audit report and energy use data directly to the authority program manager; (7)rating the service of the energy auditor,and submitting the rating to the authority; (8)submitting a request for grant reimbursement with a copy ofthe invoice paid and any other documentation the authority determines necessary. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.580.Reconsideration (a)An applicant whose application is denied may request reconsideration to the executive director of the authority.The request for reconsideration must be in writing,must state the basis for reconsideration,and must be received by the authority not more than 10 days after denial. (b)The executive director on reconsideration may accept or overturn the decision to deny the application,or request additional information from the applicant before making a decision.The decision of the executive director on reconsideration is the final agency decision.If the executive director fails to issue a decision within 30 days,the request for reconsideration is considered denied,unless the executive director extends the time for reconsideration. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 3 AAC 108.590.Definitions Exhibit R-5S Page 19 of 25 In 3 AAC 108.500 -3 AAC 108.590,unless the context requires otherwise, (1)"American Society of Heating,Refrigerating and Air-Conditioning Engineers Level I!or higher energy audit"means an energy audit that complies with guidance provided by the American Society of Heating, Refrigerating and Air-Conditioning Engineers in the publication Procedures for Commercial Building Energy Audits,Second Edition (2011),adopted by reference,for a Level Il or higher energy audit; (2)"Association of Energy Engineers certified energy auditor or certified energy manager"means an individual with the Certified Energy Auditor (CEA)or Certified Energy Manager (CEM)certification offered through the Association of Energy Engineers; (3)"building type definitions section of the Commercial Building Energy Consumption Survey"means the section designated "Building Type Definitions"in the United States Department of Energy,Energy Information Administration's Commercial Building Energy Consumption Survey,revised as of 2003;the building type definitions section of the Commercial Building Energy Consumption Survey is adopted by reference; (4)"commercial building"means a building that is (A)located in the state; (B)privately owned,including a building owned by a non-profit organization;and (C)used for commercial purposes,including office buildings,restaurants,grocery stores,warehouses, retail,medical offices,hospitals,hotels,lodges,places of worship,and buildings used for industrial, manufacturing,or other similar commercial uses; (5)"grant"or "commercial building energy audit grant"means a grant awarded under 3 AAC 108.500 -3 AAC 108.590. History History:Eff.9/25/2013,Register 207 Annotations Authority:AS 44.83.080 Editor's note:A copy of the American Society of Heating,Refrigerating and Air-Conditioning Engineers publication Procedures for Commercial Building Energy Audits,adopted by reference in 3 AAC 108.590, is available for inspection at the offices of the Alaska Energy Authority,813 West Northern Lights Boulevard,Anchorage,Alaska 99503.A copy of the publication may also be obtained from the American Society of Heating,Refrigerating and Air-Conditioning Engineers at ASHRAE Headquarters,1791 Tullie Circle,N.E.,Atlanta,GA 30329,and at http://www.ashrae.org/resources-publications/book- store/procedures-for-commercial-building-energy-audits. A copy ofthe building type definitions section of the Commercial Building Energy Consumption Survey, adopted by reference in 3 AAC 108.590,is available for inspection at the offices of the Alaska Energy Authority,813 West Northern Lights Boulevard,Anchorage,Alaska 99503.A copy of the document may also be obtained from the United States Department of Energy,Energy Information Administration, 1000 Independence Ave.SW,Washington D.C.,20585,and at http://www.eia. gov/consumption/commercial/building-type-definitions.cfm. Exhibit R-5 Page 20 of 25 Article 6 General Provisions Section 900.Notice of availability of assistance and status of programs. 910.Protests. 915.Contract and grant claims. 920.Appeals. 990.Definitions. 3 AAC 108.900.Notice of availability of assistance and status of programs The authority will publish and periodically update on its Internet web site information on (1)solicitations for proposals,procedures for developing proposals and requesting assistance under this chapter,and criteria that the authority uses to select recipients of assistance; (2)available money for assistance under this chapter and allocation of available money to projects; (3)the status of rural power system upgrades,bulk fuel storage facility upgrades,alternative energy projects,and energy efficiency projects under this chapter;and (4)changes to programs for providing assistance under this chapter considered or proposed by the authority. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6},to the authority citation that follows 3 AAC 108.900,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. 3 AAC 108.910.Protests (a)In accordance with this section,and except as otherwise provided by statute or required as a condition of assistance received by the authority under 3 AAC 105.020,an interested party may protest the authority's award of a contract,the authority's proposed award of a contract,or a solicitation by the authority for supplies,services,professional services,or construction. (b)The protest must be submitted to the authority's procurement officer in writing,and must include (1)the name,address,and telephone number of the protester; (2)the signature of the protester or the protester's representative; (3)identification of the solicitation at issue; Exhibit R-5S Page 21 of 25 (4)a detailed statement of the legal and factual grounds for the protest,including copies of relevant documents;and (5)a statement of the remedy requested;in a protest of a procurement action,the protester is limited to remedies that would apply in a protest under AS 36.30. (c)A protest based on alleged improprieties in a bid or solicitation must be received by the authority at least 10 days before the due date of the bid or proposal.A protest based on alleged improprieties in an award of a contract or a proposed award of a contract must be filed within 10 days after the procurement officer issues a notice of intent to award the contract.For good cause shown,the authority may change a deadline set in this subsection or accept a late filed protest. (d)Upon receiving a protest,the authority will provide notice of the protest to other interested persons. (e)The authority's procurement officer shall issue a written decision on a procurement protest within 15 days after receipt of all relevant information from the protester and the authority,unless the executive director extends the time for decision for good cause shown. History History:Eff.5/12/2005,Register 174;am 10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 108.915.Contract and grant claims (a)In accordance with this section,and except as otherwise provided by statute or required as a condition of assistance received by the authority under 3 AAC 105.020,a person who has a claim against the authority under a contract or grant agreement with the authority may submit that claim to the authority. (b}The claim must be submitted to the procurement officer in writing,and must include (1)the name,address,and telephone number of the claimant; (2)the signature of the claimant or the claimant's representative; (3)identification of the contract or grant at issue; (4)a detailed statement of the legal and factual grounds for the claim,including copies of relevant documents;and (5)a statement of the remedy requested. (c)Aclaim under a contract or grant must be received by the authority within 30 days after the claimant becomes aware of the basis of the claim or should have known of the basis of the claim,except that the information required in (b)(4)and (5)of this section and any other relevant information must be received by the authority within 60 days after the claimant submits the claim.For good cause shown, the authority may change a deadline set in this subsection or accept a late filed protest. (d)Upon receiving a claim,the authority will provide notice of the claim to other interested persons. Exhibit R-5 Page 22 of 25 (e)The authority's procurement officer shall issue a written decision on a claim within 90 days after receipt of all relevant information from the claimant and the authority,unless the executive director extends the time for decision for good cause shown. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 108.920.Appeals (a)A protester who is dissatisfied with a decision of the procurement officer under 3 AAC 108.910,a claimant who is dissatisfied with a decision of the procurement officer under 3 AAC 108.915,ora protester dissatisfied with other action of the authority,may appeal the decision to the board of directors of the authority or,if the board of directors has authorized the executive director to make the final decision of the authority,to the executive director.A protester or claimant must submit an appeal within 10 days after receiving the decision to be appealed. (b)Upon receiving an appeal under (a)of this section,the executive director shall review the protest or claim,relevant information from agency staff,including any decision of the procurement officer and other relevant information,and shall (1)prepare a final decision or a recommended decision for consideration by the board of directors of the authority; (2)conduct a hearing and prepare a final decision or recommended decision for consideration by the board of directors of the authority; (3)designate a hearing officer to conduct a hearing and prepare a recommended decision for consideration by the executive director or the board of directors of the authority;or (4)refer the matter to a mediator or arbitrator for resolution,subject to approval of the resolution by the executive director or the board of directors of the authority. (c}The board of directors of the authority will adopt a recommended decision prepared under (b)of this section,adopt the recommended decision with modifications,reject the recommended decision,or return the recommended decision to the executive director or hearing officer for additional findings. (d)In conducting a hearing under this section,the hearing officer or executive director may (1)hold prehearing conferences to settle,simplify,or identify the issues in a proceeding,or to consider other matters that may aid in the expeditious disposition of the proceeding; (2)require parties to state their positions concerning the various issues in the proceeding; (3)require parties to produce for examination those relevant witnesses and documents under their control; (4)rule on motions and other procedural matters; (5)regulate the course of the hearing and conduct of the participants; (6)establish time limits for submission of motions or memoranda; Exhibit R-5 Page 23 of 25 (7)impose appropriate sanctions against a person who fails to obey an order relating to the hearing procedures,including (A)prohibiting the person from asserting or opposing designated claims or defenses or introducing designated matters into evidence; (B)excluding all testimony of an unresponsive or evasive witness;and (C)excluding a person from further participation in the hearing; (8)take official notice of a material fact not appearing in evidence,if the fact among the traditional matters subject to judicial notice;and (9)administer oaths or affirmations. (e)The board of directors of the authority may delegate to the executive director authority to make the final decision regarding protests of procurement actions,claims under contracts or grants,and protests of other actions of the authority,and contract claims,as the board determines is appropriate. (f}A decision by the board of directors of the authority,or by the executive director on matters delegated to the executive director,is a final decision for purposes of judicial review. History History:Eff.10/16/2009,Register 192 Annotations Authority:AS 42.45.045 AS 44.83.080 3 AAC 108.990.Definitions tn this chapter,unless the context requires otherwise, (1)"alternative energy" (a)means energy or fuel that is used for production of electricity,heat,or mechanical power,and that is derived from renewable or local sources other than liquid petroleum;and (b)includes (i)wind,solar,geothermal,hydroelectric,and biomass power sources;and (ii)local sources of coal and natural gas; (2)"bulk fuel storage facility"means tanks and appurtenant facilities and equipment,including pipelines and headers,for the storage and distribution of fuel for local consumption or power generation; (3)"construction"means planning for,designing,preparing the site for,building,altering,testing,or improving the facility or equipment being upgraded; (4)"energy efficiency”means improvement of energy generation from,transmission by,or utilization at existing facilities in the state;"energy efficiency"includes facility insulation,energy-efficient lighting, improved efficiency in diesel generation of power,and co-generation of electricity,heat or mechanical power; (S)"native corporation"means a regional or village corporation established under 43 U.S.C.1601 - 1629h (Alaska Native Claims Settlement Act); (6)"power project"or "power system”has the meaning given "power project”in AS 44.83.990; Exhibit R-5S Page 24 of 25 (7)"upgrade"means construction,renovation,repair,replacement,or other improvements to a facility or equipment;"upgrade"includes taking out of service facilities or equipment replaced or rendered obsolete by the improvements to the facility or equipment. History History:Eff.3/25/2005,Register 173 Annotations Authority:AS 42.45.900 AS 44.83.080 Editor's note:In 2010 the revisor of statutes,acting under AS 01.05.031,renumbered former AS 42.45.400 as AS 42.45.900.As of Register 197 (April 2011),the regulations attorney made a conforming technical revision under AS 44.62.125(b)(6),to the authority citation that follows 3 AAC 108.990,so that the citation to former AS 42.45.400 now refers to the renumbered statute,AS 42.45.900. Exhibit R-5 Page 25 of 25 Exhibit R-6 2 AAC 45.010.Audit requirements (a)A state agency that enters into a financial assistance agreement to provide financial assistance to an entity shall,in coordination with any other state agencies providing financial assistance to that entity, require that entity to submit to the department an audit of the recipient entity if that entity is subject to an audit under this section.The audit must be conducted and submitted as described in this section.In order to ensure compliance with this subsection,a state agency must include the audit requirements of this section in any financial assistance agreement subject to this subsection. (b)An entity that expends financial assistance with a cumulative total of $500,000 or more during the entity's fiscal year shall submit an audit report for the audit period to the department,by [Single Audit details deleted] (m)Financial assistance in the following form is not included when calculating whether an entity meets the threshold monetary requirement under (b)of this section: (8)money expended for projects that are solely managed,supervised,and controlled by the Alaska Energy Authority under AS 44.83 and turned over to the grantee at the conclusion of the project. (n)Financial assistance in a form listed in (m)of this section is not exempt from compliance testing if the entity meets the threshold monetary requirement under (b)of this section. (o)Repealed 7/1/98. History History:Eff.8/1/85,Register 95;am 6/29/90,Register 114;am 7/1/98,Register 146;am 3/31/2008, Register 185;am 8/1/2008,Register 187;am 1/1/2011,Register 196;am 9/25/2013,Register 207 Annotations Authority:AS 37.05.020 AS 37.05.190 Exhibit R-6 Pagelof1 Exhibit R-7 Chapter 12 Procurement Article 1.Source Selection.(2 AAC 12.010 -2 AAC 12.060) 2.Specifications.(2 AAC 12.070 -2 AAC 12.110) 3.Competitive Sealed Bidding;Multistep Bidding.(2 AAC 12.120 -2 AAC 12.210) 4.Competitive Sealed Proposals.(2 AAC 12.215 -2 AAC 12.315) 5.Competitive Sealed Proposals for Architect,Engineer,or Land Surveying Services.(2 AAC 12.320 -2 AAC 12.390) 6.Small Purchases.(2 AAC 12.400) 7.Single Source Procurement.(2 AAC 12.410 -2 AAC 12.420) 8.Limited Competition Procurements.(2 AAC 12.430 -2 AAC 12.430) 9.Emergency Procurements.(2 AAC 12.440 -2 AAC 12.460) 10.Contract Formation and Modification.(2 AAC 12.470 -2 AAC 12.570) 11.Innovative Procurement.(2 AAC 12.575 -2 AAC 12.577) 12.Supply Management.(2 AAC 12.580 -2 AAC 12.610) 13.Legal and Contractual Remedies.(2 AAC 12.615 -2 AAC 12.695) 14.Intergovernmental Relations.(2 AAC 12.700 -2 AAC 12.710) 15.Miscellaneous Provisions.(2 AAC 12.720 -2 AAC 12.920) 16.Design-Build Construction Contracts.(2 AAC 12.931 -2 AAC 12.949) 17.Construction Arbitration Procedures.(2 AAC 12.950 -2 AAC 12.989) 18.General Provisions.(2 AAC 12.990) Annotations Editor's note:As of Register 170 (July 2004),new Article 16 of Chapter 12 was added and former Article 16 was renumbered as present Article 17. As of Register 175 (October 2005),new Article 16 of Chapter 12 was added and former Articles 16 and 17 were renumbered as present Articles 17 and 18. Article 1 Source Selection Section 10.Nondiscrimination in source selection. 20.Exclusion of prospective contractor from competition. 30.Procuring state-produced supplies or services from industries of Alaska correctional institutions. 40.Procurement of legal counsel. 50.Procuring supplies or services from employment programs or from youth education and employment programs. 60.(Repealed). 2 AAC 12.010.Nondiscrimination in source selection Exhibit R-7 Page 1 of 80 Source selection may not be based on discrimination because of race,religion,color,national origin,sex, age,marital status,pregnancy,parenthood,disability,or political affiliation. History History:Eff.1/1/88,Register 104;am 6/29/95,Register 134 Annotations Authority:AS 36.30.040 2 AAC 12.020.Exclusion of prospective contractor from competition A procurement officer may exclude a prospective contractor from submitting a bid or proposal,or may reject a prospective contractor's bid or proposal,after making a written determination that the prospective contractor assisted in drafting the invitation to bid or request for proposal,or gained substantial information regarding the invitation to bid or request for proposal that was not available to the public. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.050 2 AAC 12.030.Procuring state-produced supplies or services from industries of Alaska correctional institutions Purchasing requirements of an agency may be fulfilled by procuring supplies produced or services performed by industries of Alaska correctional institutions.The commissioner of administration will determine whether such supplies or services meet the state's requirements and whether the price represents a reasonable cost for such supplies or services.If a procurement is to be made from the state correctional industries program,the private sector may not be solicited to compete. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 33.32.030 AS 36.30.040 AS 36.30.100 2 AAC 12.040.Procurement of legal counsel An agency may not contract for the services of legal counsel without the prior written approval of the attorney general.Contracts for the services of legal counsel may incorporate clauses for adjustments in prices,time of performance,and total dollar amount. History Exhibit R-7 Page 2 of 80 History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.015 AS 36.30.040 2 AAC 12.050.Procuring supplies or services from employment programs or from youth education and employment programs (a)The chief procurement officer shall use the list maintained by the division of vocational rehabilitation of employment programs that qualify under AS 36.30.990(12). (b)A procurement officer may fulfill agency requirements by procuring supplies produced or services performed by an eligible employment program or an accredited youth education and employment program. (c)Before procuring supplies or services from an eligible employment program or an accredited youth education and employment program,the procurement officer shall determine whether the supplies or services meet the state's requirements and whether the price represents a reasonable cost for the supplies or services.If it is determined that the requirements cannot be met by supplies produced or services performed by an eligible employment program or an accredited youth education and employment program,or the price is not reasonable,the procurement may be made from the private sector in accordance with AS 36.30 and this chapter.If a procurement is to be made from an employment program,it is not necessary that the private sector be solicited. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 11/28/97,Register 144;am 10/3/2002, Register 163 Annotations Authority:AS 36.30.040 AS 36.30.100 AS 36.30.311 Editor's note:In 2013 the revisor of statutes,acting under AS 01.05.031 and in response to amendments to AS 36.30.990 under sec.23,ch.59,SLA 2013,re-alphabetized definitions set out in AS 36.30.990.As of Register 208 (January 2014),the regulations attorney made a conforming technical revision under AS 44.62.125(b)}(6),to 2 AAC 12.050(a),so that a cross-reference to former AS 36.30.990(11)now refers to the re-numbered definition,AS 36.30.990(12). 2 AAC 12.060.Contractors lists Repealed. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;repealed 2/28/2014,Register 209 Article 2 Specifications Exhibit R-7 Page 3 of 80 Section 70.Authority to prepare specifications. 80.Purpose of specifications. 90.No unduly restrictive specifications. 100.Brand name specification. 110.Qualified products list. 2 AAC 12.070.Authority to prepare specifications The chief procurement officer may prepare and approve specifications for supplies or services.The commissioner of transportation and public facilities may prepare and approve specifications for construction and purchases for the state equipment fleet. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.060 2 AAC 12.080.Purpose ofspecifications (a)The purpose of a specification is to serve as a basis for obtaining,in a cost effective manner,a supply,service,or construction item suitable for the state's needs. (b)Specifications must,to the extent practicable,emphasize functional or performance criteria necessary to meet the needs of the state.Specifications emphasizing functional or performance criteria are primarily applicable to the procurement of supplies and services and might not be practicable in construction,apart from the procurement of supply type items for a construction project. (c)It is state policy to procure standard commercial products if practicable. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.060 2 AAC 12.090.No unduly restrictive specifications Except for specifications relating to procurements under 2 AAC 12.400(b),all specifications must describe the requirements to be met without having the effect of exclusively requiring a proprietary supply,service,or construction item,or procurement from a single source,unless no other manner of description will suffice. History Exhibit R-7 Page 4 of 80 History:Eff.1/1/88,Register 104;am 11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.060 2 AAC 12.100.Brand name specification Except for specifications relating to procurements under 2 AAC 12.400(b),a specification that limits the procurement of items to a specific manufacturer's name or catalog number may be used only if the procurement officer determines in writing that only the identified brand name item or items will satisfy the state's needs. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.060 2 AAC 12.110.Qualified products list (a)A qualified products list may be developed with the approval of the chief procurement officer,or the commissioner of transportation and public facilities,if testing or examination of the supplies or construction items before issuance of the solicitation is desirable or necessary in order to best satisfy state requirements. (b)When developing a qualified products list,a representative group of potential suppliers must be solicited,in writing,to submit products for testing and examination to determine acceptability for inclusion on a qualified products list.Any potential supplier,even though not solicited,may offer its products for consideration. (c)Inclusion on a qualified products list must be based on results of tests or examinations conducted in accordance with state requirements.Test results may be made public in a manner that protects the confidentiality of the identity of the competitors,such as using numerical designations.Except as otherwise provided by law,trade secrets,test data,and similar information provided by the supplier will be kept confidential if requested in writing by the supplier. (d)The existence of a qualified products list does not constitute prequalification of any prospective supplier of prequalified products. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.060 Exhibit R-7 Page 5 of 80 Article 3 Competitive Sealed Bidding;Multistep Bidding Section 120.Invitations for competitive sealed bids. 130.Public notice. 140.Pre-opening correction or withdrawal of bids. 150.Receipt,opening,and recording of bids. 160.Late bids,late corrections,and late withdrawals. 170.Inadvertent errors discovered after opening but before award. 180.Bid evaluation and award. 190.Only one responsive bid received. 200.Documentation of award. 210.Notice of intent to award. 2 AAC 12.120.Invitations for competitive sealed bids (a)An invitation to bid must include the following: (1)instructions and information to bidders concerning the bid submission requirements,the time and date set for receipt of bids,the address ofthe office to which bids are to be delivered,the maximum time for bid acceptance by the state,and any other special information; (2)a purchase or project description,evaluation factors,delivery or performance schedule,and the inspection and acceptance requirements that are not included in the purchase or project description; (3)a description of all applicable contract terms and conditions,including warranty and bonding or other security requirements; (4)a requirement for certification by the bidder that it complies with the applicable provisions of 42 U.S.C.1981 and 42 U.S.C.2000e -2000e-17 (Civil Rights Act),42 U.S.C.12001 -12213 (Americans with Disabilities Act of 1990),AS 18.80,and regulations adopted under those statutes; (5)a requirement for certification by the bidder that,by submitting a bid,the bidder certifies that the price submitted was independently arrived at without collusion;and (6)provisions,such as goals or financial incentives,established to eliminate and prevent discrimination in state contracting because of race,religion,color,national origin,sex,age,marital status,pregnancy, parenthood,or disability. (b)An invitation to bid may incorporate documents by reference. (c)An invitation to bid may require the receipt of all amendments issued by the using agency to be acknowledged by bidders. (d)An invitation to bid may require the submission of bid samples,descriptive literature,technical data, or other material.An invitation to bid may provide for any of the following before award: (1)inspection or testing of a product for such characteristics as quality or workmanship; (2)examination of such elements as appearance,finish,taste,or feel;or (3)other examinations to determine whether a product conforms with other purchase requirements. (e)An invitation to bid must require the bidder to submit evidence that the bidder's subcontractor work will be allocated to meet provisions,such as goals or financial incentives,established in the bid to Exhibit R-7 Page 6 of 80 eliminate and prevent discrimination in state contracting because of race,religion,color,national origin, sex,age,marital status,pregnancy,parenthood,or disability. History History:Eff.1/1/88,Register 104;am 5/16/88,Register 106;am 6/29/95,Register 134 Annotations Authority:AS 36.30.040 AS 36.30.110 2 AAC 12.130.Public notice (a)Except for small purchases made under 2 AAC 12.400,notice of an invitation to bid shall be given by posting on the Alaska Online Public Notice System as required by AS 36.30.130(a).Notice may also be provided in accordance with AS 36.30.130 by one ofthe following methods: (1)repealed 2/28/2014; (2)publication in a newspaper of general circulation,and,if practicable,in a way calculated to reach prospective contractors located in the state; (3)publication in a newspaper of local circulation in the area pertinent to the procurement,and,if practicable,in a way calculated to reach prospective contractors located in the state; (4)notices posted in public locations within the area where the work is to be performed or the material or supplies furnished; (S)communication in another appropriate media,including postings in electronic media,and,if practicable,in a way calculated to reach prospective contractors located in the state. (b)The provisions of 2 AAC 12.400(e)apply to the requirements regarding public notice of procurements for leased office space of not more than 7,000 square feet (c)Nothing in this section limits use of additional methods of public notice in order to reach prospective contractors located in the state. (d)The procurement officer shall provide notice of an invitation to bid to a prospective contractor upon request,regardless of the location of the prospective contractor. (e)The procurement officer may require payment of duplication costs or a cash deposit for supplying the invitation to bid. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 7/20/95,Register 135;am 11/28/97, Register 144;am 10/3/2002,Register 163;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.130 Editor's note:As of Register 155 (October 2000),and acting under sec.8,ch.54,SLA 2000 and AS 44.62.125(b)(6),the regulations attorney made a technical revision to 2 AAC 12.130(a),to reflect the Exhibit R-7 Page 7 of 80 enactment of Ch.54,SLA 2000,which replaced the Alaska Administrative Journal with the Alaska Online Public Notice System. 2 AAC 12.140.Pre-opening correction or withdrawal of bids (a)A bid may be corrected or withdrawn by written request received in the office designated in the invitation for bids before the time and date set for opening. (b)A request under (a)of this section must provide authorization for the person making the correction or withdrawal to do so. (c)If a bid is withdrawn,the bid security,if any,shall be returned to the bidder. (d)All documents relating to the correction or withdrawal of a bid shall be included in the appropriate procurement file. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.160 2 AAC 12.150.Receipt,opening,and recording of bids (a)A bid must be submitted with the invitation to bid number clearly identified.The rest of the bid must be in a form that cannot be viewed until opened by the procurement officer.Upon receipt,a bid correction shall be securely stored until the time and date set for bid opening. (b)Bids and corrections shall be opened at the time,date,and place designated in the invitation to bid. The name of each bidder,the bid price,and other information deemed appropriate by the procurement officer shall be tabulated. History History:Eff.1/1/88,Register 104;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.140 2 AAC 12.160.Late bids,late corrections,and late withdrawals A bid received after the time and date set for receipt of bids is late.A correction or withdrawal of a bid received after the time and date set for opening of bids at the place designated for opening is late.A late bid correction,or withdrawal,may not be accepted unless the delay was due to an error of the contracting agency. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 8 of 80 Annotations Authority:AS 36.30.040 AS 36.30.160 2 AAC 12.170.Inadvertent errors discovered after opening but before award (a)Inadvertent errors discovered after opening but before award,other than minor informalities,may not be corrected.If a bidder submits proof that clearly and convincingly demonstrates that an inadvertent error other than a minor informality was made,the bidder may withdraw the bid. (b)If,before award,a procurement officer knows of an error in a bid,the officer shall notify the bidder of the error. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.160 2 AAC 12.180.Bid evaluation and award (a)Award of a bid may not be based on discrimination due to the race,religion,color,national origin, sex,age,marital status,pregnancy,parenthood,disability,or political affiliation of the bidder.A bid shall be evaluated to determine whether the bidder responds to the provisions,such as goals or financial incentives,established in the invitation to bid in order to eliminate and prevent discrimination in state contracting because of race,religion,color,national origin,sex,age,marital status,pregnancy, parenthood,or disability. (b)An evaluation of product acceptability shall be conducted to determine whether a bidder's offering is acceptable as set out in the invitation to bid.A bid that does not meet the acceptability requirements shall be rejected as nonresponsive. (c)Bids may be evaluated to determine which bid offers the lowest cost to the state in accordance with the evaluation criteria set out in the invitation to bid.Evaluation factors need not be precise predictors of actual future costs,but to the extent possible the evaluation factors must (1)be reasonable estimates based upon information the state has available concerning future use;and (2)treat all bids equitably. (d)Nothing in this section permits contract award to a bidder submitting a higher quality item than that designated in the invitation for bids if the bidder is not also the lowest bidder as determined under (c)of this section.This section does not permit negotiations with a bidder. History History:Eff.1/1/88,Register 104;am 5/16/88,Register 106;am 6/29/95,Register 134 Exhibit R-7 Page 9 of 80 Annotations Authority:AS 36.30.040 AS 36.30.150 2 AAC 12.190.Only one responsive bid received If only one responsive bid is received in response to an invitation to bid,including multi-step bidding,an award may be made to the single bidder if the bidder is responsible and if the procurement officer finds that the price submitted is fair and reasonable and that either other prospective bidders had reasonable opportunity to respond or there is not adequate time for resolicitation.Otherwise the bid may be rejected and (1)new bids or offers may be solicited; (2)the proposed procurement may be cancelled;or (3)if the procurement officer determines in writing that the need for the supply or service continues, but that the price of the one bid is not fair and reasonable,and there is no time for resolicitation or it is unlikely that resolicitation would increase the number of bids,the procurement may be conducted under 2 AAC 12.410 (single source procurement),2 AAC 12.430 (limited competition procurement),or 2 AAC 12.440 (emergency procurements),as appropriate. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.04. AS 36.30.350 2 AAC 12.200.Documentation of award Following award,a record showing the basis for determining the successful bidder shall be made a part of the procurement file. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.500 2 AAC 12.210.Notice of intent to award Notice of intent to award does not constitute a formal award of a contract.The notice of intent to award must include (1)a statement of the bidder's right under AS 36.30 to protest the award,including the time within which the protest must be received;and (2)the name ofthe successful bidder. Exhibit R-7 Page 10 of 80 History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113 Annotations Authority:AS 36.30.040 AS 36.30.365 AS 36.30.565 Article 4 Competitive Sealed Proposals Section 215.Exceptions to competitive sealed bidding. 220.Public notice of competitive sealed proposals. 230.Correction,modification,or withdrawal of proposals. 240.Receipt and registration of proposals. 250.Late proposals,late corrections,late modifications,and late withdrawals. 260.Evaluation of proposals. 265.Evaluation factors for heavy trucks and equipment. 270.Only one responsive proposal. 280.(Repealed). 285.Clarification of offers. 290.Proposal discussions with individual offerors. 295.Amendments to requests for proposals. 300.Documentation of contractor selection. 310.Notice of intent to award. 315.Contract negotiations. 2 AAC 12.215.Exceptions to competitive sealed bidding (a)The following types of supplies and services,for which the use of competitive sealed bidding is either not practicable or not advantageous to the state,may be procured by competitive sealed proposals without a written determination by the procurement officer: (1)professional services; (2)supplies and services for clean up of oil and hazardous substances; (3)telephone systems and telephone system maintenance; (4}concession contracts; (5)repealed 11/28/97; (6)leased office space. (b)The procurement officer may procure other supplies or services not listed in (a)of this section by competitive sealed proposals only if the procurement officer determines that the use of competitive sealed bidding is not practicable or not advantageous to the state.The determination under this subsection must comply with AS 36.30.200(b) Exhibit R-7 Page 11 of 80 History History:Eff.3/30/90,Register 113;am 6/29/95,Register 134;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.220.Public notice of competitive sealed proposals Public notice shall be given by distributing the request for proposals or notice of requests for proposals in the manner provided in 2 AAC 12.130. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.210 2 AAC 12.230.Correction,modification,or withdrawal of proposals A proposal may be corrected,modified,or withdrawn before the time and date set for receipt of proposals,in the manner described in 2 AAC 12.140. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 2 AAC 12.240.Receipt and registration of proposals Proposals,modifications,and corrections shall have the date and time of receipt recorded upon receipt, and shall be held securely.After the date set for receipt of proposals,a register of proposals must be prepared.The register must include the name of each offeror and a description of the supply,service,or construction item offered. History History:Eff.1/1/88,Register 104;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.230 Exhibit R-7 Page 12 of 80 2 AAC 12.250.Late proposals,late corrections,late modifications,and late withdrawals Unless otherwise provided in the request for proposals,a proposal,correction,modification,or withdrawal received after the date and time set for receipt of proposals is late,and may not be accepted unless the delay is due to an error of the contracting agency. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125 Annotations Authority:AS 36.30.040 AS 36.30.210 2 AAC 12.260.Evaluation of proposals (a)The procurement officer,or a procurement evaluation committee consisting of at least three state employees or public officials,shall evaluate proposals.The procurement officer may be one of the members on a procurement evaluation committee. (b)The evaluation must be based only on the evaluation factors set out in the request for proposals. The relative importance or weighting value of each evaluation factor shall be set out in the request for proposals.Numerical rating systems may be used,but are not required.If a numerical rating system is not used,the procurement officer,or each member of the evaluation committee,as applicable,shall explain his or her ranking determination in writing. (c}Price must be an evaluation factor unless the services or supplies sought are selected in accordance with AS 36.30.270(a)and (b).The proposal with the lowest price must receive the highest available rating allocated to price.A proposal that has a higher price than the next lowest must receive a lower rating for price. (d)For the purposes of evaluating price,the proposed price of an offeror who qualifies as an Alaska bidder under AS 36.30.990(2)shall be reduced by five percent.All other applicable preferences must be applied.This subsection does not apply to solicitations or contracts for lease space under AS 36.30.080. {e)If a numerical rating system is used,an Alaska offeror's preference of at least 10 percent of the total possible value ofthe rating system must be assigned to a proposal of an offeror who qualifies as an Alaska bidder under AS 36.30.990(2).This subsection does not apply to solicitations or contracts for lease space under AS 36.30.080. (f)The following are some additional evaluation factors that may be considered: (1)the offeror's experience in Alaska performing work similar to that sought in the request for proposals; (2)the percentage of work that will be performed in Alaska; (3)the location ofthe office of the offeror where the work will be performed; (4)the offeror's past performance,including conformance to specifications and standards of good workmanship,forecasting and containment of costs or prices,history of reasonable and cooperative behavior and overall concern for the interests of the customer,and adherence to contract schedules. (g)A proposal from an offeror debarred or suspended under AS 36.30.635 -36.30.655 must be rejected. Exhibit R-7 Page 13 of 80 (h)Meetings may be held by a procurement evaluation committee to discuss the request for proposals, the evaluation process,the weighting of evaluation factors,and proposals received. (i)If the evaluation is performed by a procurement evaluation committee,each member shall exercise independent judgment and the vote of one member may not be weighted more than the vote of any other member. (j)An evaluation may not be based on discrimination due to the race,religion,color,national origin, sex,age,marital status,pregnancy,parenthood,disability,or political affiliation of the offeror.A proposal shall be evaluated to determine whether the offeror responds to the provisions,including goals and financial incentives,established in the request for proposals in order to eliminate and prevent discrimination in state contracting because of race,religion,color,national origin,sex,age,marital status,pregnancy,parenthood,disability,or political affiliation of the offeror. History History:Eff.1/1/88,Register 104;am 5/16/88,Register 106;am 7/2/88,Register 106;am 3/30/90, Register 113;am 3/27/93,Register 125;am 6/29/95,Register 134;am 11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.210 AS 36.30.230 AS 36.30.250 AS 36.30.321 2 AAC 12.265.Evaluation factors for heavy trucks and equipment if a state agency uses competitive sealed proposals to procure heavy trucks and heavy equipment,the state agency may use other evaluation factors in addition to the evaluations factors set out in 2 AAC 12.260(c)-(f),including (1)the price; (2)the quality of the article offered; (3)the performance capabilities of the offerors and the manufacturers; (4)the suitability of the article offered; (5)the service requirements,including warranty,parts availability,and parts locations; (6)durability as measured by projected operating and maintenance costs; (7)the resale value; (8)the transportation charges; (9)the date of delivery and performance;and (10)other factors determined to be pertinent or peculiar to the procurement. History History:Eff.3/27/93,Register 125;am 11/28/97,Register 144 Exhibit R-7 Page 14 of 80 Annotations Authority:AS 36.30.040 AS 36.30.250 2 AAC 12.270.Only one responsive proposal \f after evaluation under 2 AAC 12.260 and discussion under 2 AAC 12.290 only one responsive and responsible proposal is available for award,the procurement officer may make an award in accordance with AS 36.30.250,may reject the proposal,or may reject the proposal and resolicit proposals. History History:Eff.1/1/88,Register 104;am 6/29/95,Register 134 Annotations Authority:AS 36.30.040 AS 36.30.350 2 AAC 12.280.Duty of offerors Repealed. History History:Eff.1/1/88,Register 104;repealed 6/29/95,Register 134 2 AAC 12.285.Clarification of offers In order to determine if a proposal is reasonably susceptible for award,communications by the procurement officer or the procurement evaluation committee are permitted with an offeror for clarification of uncertainties or elimination of confusion concerning the contents of a proposal that does not result in a material or substantive change to the proposal.The evaluation by the procurement officer or the procurement evaluation committee may be adjusted as a result of a clarification under this section. History History:Eff.11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.240 2 AAC 12.290.Proposal discussions with individual offerors (a)Offerors of proposals reasonably susceptible for award as determined in the evaluation conducted under 2 AAC 12.260 may be offered the opportunity to discuss their proposals with the procurement officer or evaluation committee at the discretion of the procurement officer.The procurement officer Exhibit R-7 Page 15 of 80 may limit discussions to specific sections of the proposals received or specific sections of the request for proposals.The opportunity for confidential discussions,if held,must be extended to all offerors submitting proposals deemed reasonably susceptible for award.Auction techniques that reveal one offeror's price to another,and disclosure of any information derived from competing proposals,are prohibited. (b)Any oral modification of a proposal resulting from proposal discussions under (a)of this section shall be reduced to writing by the offeror. (c)Following discussions,the procurement officer may set a date and time for the submission of best and final proposals.Best and final proposals may be submitted only once.However,the chief procurement officer or the head of a purchasing agency may make a written determination that it is in the state's best interest to conduct additional discussions or change the state's requirements and require another submission of best and final proposals.Otherwise,discussion of or changes in the best and final proposals may not be allowed before award.If an offeror does not submit a best and final proposal or a notice of withdrawal,the offeror's previous proposal is considered the offeror's best and final proposal. (d)The evaluation of a proposal may be adjusted as a result of a discussion under this section.The conditions,terms,or price of the proposal may be altered or otherwise changed during the course of the discussions provided the changes are within the scope of the request for proposals.After best and final proposals are received,final evaluations will be conducted as described in 2 AAC 12.260. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.240 2 AAC 12.295.Amendments to requests for proposals If,after receipt of proposals,there is a need for any substantial clarification of or material change in the request for proposals,the request must be amended to incorporate the clarification or change,and a date and time established by the procurement officer for receipt of new or amended proposals. Evaluations may be adjusted as a result of receiving new or amended proposals. History History:Eff.11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.210 2 AAC 12.300.Documentation of contractor selection Exhibit R-7 Page 16 of 80 When a contractor has been selected by competitive sealed proposal,the procurement officer shall enter into the procurement file a written record of the basis on which the selection was found to be most advantageous to the state. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.250 2 AAC 12.310.Notice of intent to award Notice of intent to award shall be issued in accordance with 2 AAC 12.210. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.365 2 AAC 12.315.Contract negotiations After final evaluation of proposals,including an adjustment of an evaluation of a proposal!as authorized under 2 AAC 12.290(d)and 2 AAC 12.295,the procurement officer may negotiate with the offeror of the highest ranked proposal for the purpose of obtaining contract terms consistent with the solicitation and with terms favorable to the state.If changes are made to the proposal during contract negotiations,the changes must be reasonable;however,the changes may not have the effect of changing the ranking of the highest ranked proposal.If the procurement officer determines that the offeror of the highest ranked proposal fails to negotiate in good faith or fails to negotiate within the time period set by the procurement officer,the procurement officer may terminate negotiations and begin contract negotiations with the offeror of the next highest ranked proposal in the manner prescribed in this section. History History:Eff.11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 Article S Competitive Sealed Proposals for Architect,Engineer,or Land Surveying Services Exhibit R-7 Page 17 of 80 Section 320.Procurement of architect,engineer,or land surveying services. 330.Determinations required before procurement of services. 340.Public announcement of required architect,engineer,or land surveying services. 350.Architect,engineer,or land surveyor selection committee. 360.Evaluation of statements of qualifications and performance data;selection of firms or persons for discussions. 370.Discussions. 380.Selection of the most qualified and suitable firms or persons. 390.Negotiation and award of contract. 2 AAC 12.320.Procurement of architect,engineer,or land surveying services {a)Except as provided otherwise in this section,architect,engineer,or land surveyor services must be procured under 2 AAC 12.220 -2 AAC 12.310,2 AAC 12.320 -2 AAC 12.390,and 2 AAC 12.400.In the case of inconsistency,the provisions of 2 AAC 12.320 -2 AAC 12.390 control. (b)Procurement of minor or incidental architect,engineer,or land surveying work associated with and performed during construction,is not subject to 2 AAC 12.320 -2 AAC 12.390. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.330.Determinations required before procurement of services Before announcing the need for architect,engineer,or land surveying services,the head of the purchasing agency must determine. (1)that the services to be acquired are services subject to AS 36.30.270; (2)that a reasonable inquiry has been conducted and it has been determined that state personnel are unable or unavailable to perform the services required under the proposed contract; (3)that the purchasing agency has developed,and fully intends to implement,a written plan for using the services. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.340.Public announcement of required architect,engineer,or land surveying services (a)Notice of the need for architect,engineer,or land surveying services shall be given as described in 2 AAC 12.130. Exhibit R-7 Page 18 of 80 (b)A solicitation must be prepared which describes the state's requirements,sets out the evaluation criteria,and includes notice of any conference to be held. (c)The procurement officer may require a payment of a fee or deposit to supply a solicitation. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.350.Architect,engineer,or land surveyor selection committee (a)If a contract for architect,engineer,or land surveying services is expected to exceed the dollar threshold for construction set out in 2 AAC 12.400(d),the chief procurement officer,commissioner of transportation and public facilities,or commissioner of natural resources,as appropriate,shall designate a minimum of three state employees or public officials to serve as members of an architect,engineer, and land surveying selection committee for that contract.The committee must consist of (1)a majority of registered persons if registration is required under AS 36.30.270(d),or,if registration is not required under AS 36.30.270(d),a majority of state employees who are well qualified in architecture,engineering,or land surveying,as appropriate;and (2)a procurement officer representing the purchasing agency requiring the services,and preferably qualified in architecture,engineering or land surveying,and other members as appropriate. (b)The chief procurement officer,commissioner of transportation and public facilities,or commissioner of natural resources,as appropriate,shall designate one member to chair the committee and to negotiate a contract with the most qualified and suitable firm or person in accordance with AS 36.30.270. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125;am 4/25/97,Register 142;am 2/28/2014, Register 209 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.360.Evaluation of statements of qualifications and performance data;selection of firms or persons for discussions (a)The selection committee shall evaluate (1)statements submitted in response to the solicitation for architect,engineer,or land surveying services,including proposals for joint ventures;and (2)supplemental statements of qualifications and performance data,if submission of such statements was required. Exhibit R-7 Page 19 of 80 (b)All statements and supplemental statements of qualifications and performance data shall be evaluated in light of the criteria set out in the solicitation. (c)Criteria to be used in evaluating the statement of qualifications and performance data may include (1)experience in providing the required services; (2)the qualifications and competence of persons who would be assigned to perform the services,as reflected by technical training and education; (3)ability to perform the services,as reflected by workload and the availability of adequate personnel, equipment,and facilities to perform the services expeditiously;and (4)past performance,as reflected by the evaluations of private persons and officials of other government entities that have retained the services of the firm or person,with respect to such factors as control of costs,quality of work,and ability to meet deadlines. (d)The selection committee may select firms or persons evaluated as being professionally and technically qualified for discussions and reasonably susceptible for award of a contract.The procurement officer shall notify each firm or person in writing of the date,time,and place of discussions,and,if necessary,shall provide each firm or person with additional information on the project and the services required.The notice may provide that a representative of a firm or person must attend discussions in order for the firm or person to be considered further. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.370.Discussions The selection committee may hold discussions regarding the proposed contract with the firms or persons selected.The purpose of such discussions is to explore the scope and nature of the required services and the relative utility of alternative methods of approach.The conditions,terms,or price of the proposed contract may be altered or otherwise changed during the course of the discussions. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.380.Selection of the most qualified and suitable firms or persons After discussions,if held under 2 AAC 12.370,the selection committee shall reevaluate and select,in order of preference,no fewer than three firms or persons that the committee considers to be the most highly qualified and suitable to provide the required services.The selection committee shall prepare a Exhibit R-7 Page 20 of 80 memorandumof the selection process which indicates how the evaluation criteria were applied to determine the ranking of the three most highly qualified and suitable firms or persons.The memorandum shall be included in the procurement file. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125 Annotations Authority:AS 36.30.040 AS 36.30.270 2 AAC 12.390.Negotiation and award of contract (a)The procurement officer shall negotiate with the most qualified and suitable offerors in the order in which they are ranked.Contract negotiations shall be directed toward (1)making certain that the offeror has a clear understanding of the scope of the work and the requirements involved in providing the required services; (2)determining that the offeror will make available the necessary personnel and facilities to perform the services within the required time;and (3)agreeing upon compensation that is fair and reasonable,taking into account the estimated value, scope,complexity,and nature of the required services. (b)The offeror selected for award shall submit and certify cost and pricing data. (c)Upon failure to negotiate a contract with the most qualified and suitable offeror,the procurement officer shall enter into negotiations with the next most qualified and suitable offeror. (d)If the procurement officer is unable to negotiate a contract with any of the offerors initially selected as the most highly qualified and suitable offerors,additional offerors may be selected in preferential order based on their respective qualifications. (e)Written notice of the intent to award must comply with 2 AAC 12.310 and must be sent to each offeror.Notice of intent to award must be made available to the public. (f)After award of the contract,a memorandum setting out the principal elements of the negotiation shall be prepared by the procurement officer.The memorandum shall be included in the procurement file and be available to the public upon request. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125 Annotations Authority:AS 36.30.040 AS 36.30.270 AS 36.30.400 Article 6 Small Purchases Exhibit R-7 Page 21 of 80 Section 400.Authority to make small purchases. 2 AAC 12.400.Authority to make small purchases (a)Repealed 2/28/2014. (b)A purchasing agency shall use reasonable and adequate procedures and make records that facilitate auditing of the purchasing agency,when procuring (1)supplies,services,professional services,or construction estimated to cost not more than $10,000; (2)concession contracts estimated to have gross receipts of not more than $10,000; (3)supplies or services while on travel status with or on behalf of the governor estimated to cost not more than $30,000; (4)fish feed for hatchery use estimated to cost not more than $30,000; (5)passenger transportation estimated to cost not more than $30,000; (6)professional services for the office of the governor estimated to cost not more than $50,000; (7)legal or hearing officer services estimated to cost not more than $50,000. (c)Except for procurements under (b)of this section,a purchasing agency shall use the following procedures in the procurement of supplies,services,professional services,or construction estimated to cost more than $10,000,but not more than $50,000,or for concession contracts estimated to have gross receipts of more than $10,000,but not more than $50,000: (1)for the solicitation, (A)at least three firms or persons shall be contacted for a quotation or informal proposal and the procurement officer shall designate whether the response may be made in writing or verbally;and (B)the solicitation may be made verbally or in writing and shall include the specifications,the award criteria,and the date and time responses are due; (2)for the award,the purchasing agency shall make the award (A)in accordance with the specifications and award criteria in the solicitation;and (B)to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the purchasing agency; (3)as part ofthe file on the procurement,the procurement officer shall include the (A)name of the person who made the solicitation and the date of the solicitation; (B)information provided by the purchasing agency under (1)(B)of this subsection; (C)names ofthe firms or persons contacted,a summary of any verbal responses,and copies of all quotations or informal proposals received;and (D)justification for the award. (d)A purchasing agency shall use the following procedures for the procurement of supplies,services,or professional services estimated to cost more than $50,000,but not more than $100,000;for concession contracts estimated to have gross receipts of more than $50,000,but not more than $100,000;or for construction estimated to cost more than $50,000,but not more than $200,000: (1)for the solicitation, {A)at least three firms or persons shall be contacted for a quotation or informal proposal and the procurement officer shall require the response to be made in writing;and Exhibit R-7 Page 22 of 80 {B)the solicitation shall be made in writing and shall include the specifications,the award criteria,and the date and time responses are due; (2)for the award,the purchasing agency shall (A)make the award (i)in accordance with the specifications and award criteria in the solicitation;and (ii)to the responsive and responsible firm or person that submitted the lowest quotation or the informal proposal that is the most advantageous to the purchasing agency;and (B)provide written notice of the award,including the name of the successful offeror,to each firm or person providing a quotation or informal proposal,and shall describe protest rights under 2 AAC 12.695 and the time limitations within which a protest must be received by the purchasing agency; (3)as part of the file on the procurement,the procurement officer shall include (A)a copy of the solicitation made under (1)(B)of this subsection; (B)the names of the firms or persons contacted and copies of all written quotations or informal proposals received;and (C)documentation of and the justification for the award. (e)For procurement of lease of space that does not exceed 7,000 square feet,the procedures described in (b)-(d)of this section shall be followed for the appropriate estimated cost limitations,except as provided in this subsection.A notice of award under this subsection shall be in writing.Notwithstanding 2 AAC 12.130 or any other provision of this section,for a procurement of lease of space that does not exceed 7,000 square feet and estimated to cost more than $100,000 for the term of the lease,including extensions,the procurement officer shall provide public notice by at least one of the following notification methods for the solicitation: (1)repealed 2/28/2014; (2)publication in a newspaper of general circulation,and,if practicable,in a way calculated to reach prospective contractors located in the state; (3)publication in a newspaper of local circulation in the area pertinent to the procurement,and,if practicable,in a way calculated to reach prospective contractors located in the state; (4)notices posted in public locations within the area where the work is to be performed or the material or supplies furnished; (5)publication in other appropriate media,including postings in electronic media,and,if practicable,in a way calculated to reach prospective contractors located in the state. (f)A procurement made under this section shall be solicited from Alaskan vendors,whenever practicable,and is subject to applicable Alaskan bidder and Alaskan products preferences as set out in AS 36.30 and 2 AAC 12.260(e). (g)Nothing in this section prevents postings in electronic media to satisfy the competitive solicitation and notice of award requirements.Quotes and informal proposals may be submitted in electronic media if permitted by the procurement officer. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 3/27/93,Register 125;am 6/29/95, Register 134;am 4/25/97,Register 142;am 11/28/97,Register 144;am 2/28/2014,Register 209 Exhibit R-7 Page 23 of 80 Annotations Authority:AS 36.30.040 AS 36.30.320 Article 7 Single Source Procurement Section 410.Conditions for use of single source procurement. 415.Single source determination. 420.Record of single source procurement. 2 AAC 12.410.Conditions for use ofsingle source procurement (a)A request by a purchasing agency that a procurement be restricted to one potential contractor shall be accompanied by a written explanation that meets the requirements of 2 AAC 12.415 as to why it is not practicable to award a contract by competitive sealed bidding,competitive sealed proposals,or small procurement procedures,and why award to a single source is the state's best interests.An agency may advertise its intent to make a single source award to determine if such an award is appropriate.The agency shall include with the written explanation the evidence necessary for the independent examination and determination of the material facts of the procurement,subject to AS 36.30.315. Except for a procurement that does not exceed the amount for small procurements under AS 36.30.320, the award of a single source procurement may not be made without the prior written approval of the chief procurement officer or the commissioner of transportation and public facilities,as appropriate under AS 36.30.300(a). (b)A determination under AS 36.30.300(a)must specify the duration of the determination's effectiveness. (c)A procurement officer shall conduct negotiations,as appropriate,as to the price,delivery,and terms of a single source procurement. (d)The following are examples of circumstances in which sole source procurement might be appropriate: (1)if the compatibility of equipment,accessories,or replacement parts is the main consideration; (2)if a specific item is needed for trial use or testing,including testing of a prototype; (3)if an item is to be procured for resale; (4)repealed 6/29/95; (5)if there exists a sole source of expertise required to perform a specific professional service; (6)if the procurement is for operation of a concession contract on state property by a nonprofit organization whose sole purpose is to operate the concession and provide other public services on the property; (7)if the procurement is with a government police agency to provide investigative,enforcement,or support services in support of state law enforcement objectives; Exhibit R-7 Page 24 of 80 (8)if the procurement is for the services of legal counsel for the purpose of advising or representing the state in specific civil or criminal proceedings or on a specific matter before a federal or state regulatory agency,board,or commission; (9)if the procurement is by the Office of the Governor for lobbying,Jabor negotiation,or consulting by a foreign national. History History:Eff.1/1/88,Register 104;am 6/29/95,Register 134;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.300 AS 36.30.315 2 AAC 12.415.Single source determination A determination by a state procurement official that a specific course of action is or is not "in the state's best interest"under AS 36.30.300 means a determination that is reasonable under the circumstances and is neither arbitrary,capricious,or prompted by corruption.A request to employ the single source procurement method under AS 36.30.300 that is based on a determination that it is "in the state's best interest”shall cite the specific and significant interests to support use of the single source procurement method. History History:Eff.11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.300 2 AAC 12.420.Record of single source procurement A record of every single source procurement shall be made and forwarded to the chief procurement officer,and must include (1)the supplier's or contractor's name; (2)the amount and type of each contract; (3)a listing of the supplies,services,or construction procured under each contract;and (4)the identification number of each procurement file. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 Exhibit R-7 Page 25 of 80 AS 36.30.300 AS 36.30.520 Article 8 Limited Competition Procurements Section 430.Conditions for use of limited competition procurement. 2 AAC 12.430.Conditions for use of limited competition procurement (a)A request by a purchasing agency to limit that a procurement to two or more potential contractors must be accompanied by a written explanation as to why the solicitation should be limited,and why the competitive sealed bidding,competitive sealed proposals,or small procurement procedures are impracticable or contrary to the public interest.The agency must include with the written explanation the evidence necessary for the independent examination and determination of the material facts of the procurement,subject to AS 36.30.315.To determine if other sources are available or interested ina procurement,an agency may advertise an intent to make a limited competition procurement.Except for a procurement that does not exceed the amount for small procurements under AS 36.30.320,the award of a limited competition procurement may not be made without the prior written approval of the chief procurement officer,the commissioner of transportation and public facilities,or the attorney general,as appropriate under AS 36.30.305(a). (b)A procurement for construction under this section must be for less than $100,000. (c)A procurement officer shall solicit offers or conduct negotiations,as appropriate,as to price, delivery,and terms,equally with each potential contractor for a limited competition procurement. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 6/29/95,Register 134;am 11/28/97, Register 144 Annotations Authority:AS 36.30.040 AS 36.30.305 Article 9 Emergency Procurements Section 440.Determination of emergency conditions. 450.Procurement methods for emergency conditions. 460.Record of emergency procurement. Exhibit R-7 Page 26 of 80 2 AAC 12.440.Determination of emergency conditions (a)For the purposes of AS 36.30.310,emergency conditions include (1)fire,flood,epidemic,riot,environmental!accident,or a similarly compelling reason; (2)equipment failure,if the need for timely repair is essential; (3)a situation in which procurement through competitive sealed bidding or competitive sealed proposals is impracticable or contrary to the public interest;or (4)a need to protect public or private property. (b)Unless a determination of emergency is made as provided in (c)of this section before a procurement may be made under this section,a written determination of emergency is required from the chief procurement officer,or from the commissioner of transportation and public facilities for a construction contract or a procurement for the state equipment fleet.An agency requesting a determination of emergency shall provide a written explanation as to why emergency conditions exist.The agency shall include with its explanation the evidence necessary for the independent examination and determination of the material facts of the procurement,subject to AS 36.30.315. (c)A determination of emergency under this section (1)may be made by a responsible agency official if (A)immediate action is necessary to protect public health,welfare,or safety,or to protect public or private property;and (B)insufficient time exists for (i)the agency to provide the explanation and evidence required under (b)of this section;and (ii)the chief procurement officer or the commissioner of transportation and public facilities to make the written determination of emergency required under AS 36.30.310 and (b)of this section;and (2)is subject to AS 36.30.315. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 6/29/95,Register 134;am 11/28/97, Register 144 Annotations Authority:AS 36.30.005 AS 36.30.040 AS 36.30.310 2 AAC 12.450.Procurement methods for emergency conditions (a)When emergency procurement is authorized by AS 36.30.310 and 2 AAC 12.440,and emergency procurement is limited to the supplies,services,professional services,or construction necessary to meet the emergency,and shall be made with competition that is practicable under the circumstances. (b)An agency may make an emergency procurement by any reasonable means.If practical,approval by the head of the agency must be obtained before an emergency procurement of $50,000 or more is made. (c)A procurement by the Department of Natural Resources during a fire suppression emergency shall be made in accordance with the procedures established by that department. Exhibit R-7 Page 27 of 80 History , History:Eff.1/1/88,Register 104;am 11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.310 2 AAC 12.460.Record of emergency procurement The procurement officer or the agency official responsible for procurement shall make and promptly forward to the chief procurement officer a record of each emergency procurement.The record must set out (1)the contractor's name; (2)the amount and type of the contract; (3)a listing of the supplies,services,or construction procured under the contract;and (4)the identification number of the procurement file. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.310 Article 10 Contract Formation and Modification Section 470.Standard contract clauses. 475.Changes,liquidated damages,and terminations. 480.Novation or change of name. 485.Contract amendments. 490.(Repealed). 500.Standards of responsibility. 510.Access to plant or place of business. 520.Inspection and testing of supplies and services. 530.Retention of books and records. 540.Price analysis. 550.Cost and pricing data. 560.Guidelines for cost principles. 570.Use of federal cost principles. Exhibit R-7 Page 28 of 80 2 AAC 12.470.Standard contract clauses The chief procurement officer and the commissioner of transportation and public facilities,in consultation with the attorney general,may establish standard contract clauses for state contracts.A procurement officer may modify a standard clause only with the prior written approval of the attorney general as to form. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.340 2 AAC 12.475.Changes,liquidated damages,and terminations (a)A state contract may include a clause that provides for adjustment of the contract price,adjustment of the time of performance,liquidated damages,termination of the contract,or a term that the procurement officer deems appropriate. (b)A contract clause allowing the imposition of liquidated damages must specify their purpose,their amount,and the circumstances for which they are authorized. (c)A contract clause allowing termination of a contract for cause must specify the circumstances under which the state may terminate the contract,the procedural steps required for a termination to be effective,and the rights and responsibilities of the parties regarding payment and work in progress. (d)A contract clause allowing termination of a contract for convenience of the state must specify the procedural steps required for a termination to be effective and the rights and responsibilities of the parties regarding payment and work in progress. History History:Eff.7/20/95,Register 135 Annotations Authority:AS 36.30.040 AS 36.30.430 2 AAC 12.480.Novation or change of name (a)Astate contract or subcontract may not be transferred or otherwise assigned without the prior written consent of the procurement officer responsible for the contract. (b)If the procurement officer responsible for the contract determines it is in the best interests of the state,a successor in interest may be recognized in a novation agreement in which the transferor and the transferee agree that (1)the transferee assumes all of the transferor's obligations under the contract; (2)the transferor waives any and all rights it has under the contract against the state;and Exhibit R-7 Page 29 of 80 (3)the transferee furnishes satisfactory performance and payment bonds,if required by the procurement officer. (c)If a contractor requests to change the name in which it holds a contract with the state,the procurement officer responsible for the contract may,when it is in the best interests of the state,enter into an agreement with the requesting contractor to effect the change of name.The agreement changing the name must specifically indicate that no other terms and conditions of the contract are changed. (d)An assignment of payments of a state contract may not be made without the prior written consent of the contracting agency responsible for the contract. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 2 AAC 12.485.Contract amendments (a)Except for contract amendments in a contract with a clause that authorizes adjustment under 2 AAC 12.475(a),all amendments to contracts shall be made in accordance with this section. (b)The procurement officer may amend a contract for construction,as "construction"is defined under AS 36.30.990,but only if the amendment is within the scope of the original contract. (c)The procurement officer may amend a contract established under 2 AAC 12.400 within the scope of the original contract,but the amendment may not increase the contract beyond the small procurement limits established under AS 36.30.320. (d)Except for amendments established under (b)or (c)of this section,unanticipated contract amendments that exceed the lesser of 20 percent of the amount of the original term of the contract,or a subsequent current term of the contract,as applicable,or $100,000,may be made only if the chief procurement officer or,for state equipment fleet contracts,the commissioner of transportation and public facilities,or,for contracts for the services of legal counsel,the attorney general,determines in writing that the amendment is in the state's best interest.A request by a purchasing agency to amend a contract that exceeds these limits must be accompanied by a written explanation listing specific reasons why the amendment is in the state's best interests,and must address (1)whether the change is legitimate and due to unforeseen circumstances which occurred as work progressed,and whether the reasons for the change were unforeseen at the time the contract was established,as opposed to an effort to evade procurement requirements; (2)whether the additional work is within the scope of the original contract; (3)whether the contract contains clauses authorizing modification;and (4)whether the amendment represents any important general change which alters the essential identity or main purpose of the original contract,or is of such importance as to constitute a new undertaking. (e)An amendment to a contract which the procurement officer determines does not address each provision set out in (d)(1)-(4)of this section but which is determined by the procurement officer to be in the state's best interest may qualify as a single source procurement under 2 AAC 12.410. Exhibit R-7 Page 30 of 80 History History:Eff.11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 2 AAC 12.490.Responsibility of prospective contractors Repealed 3/27/93. 2 AAC 12.500.Standards of responsibility (a)Factors that may be considered in determining whether a prospective contractor is responsible include whether the prospective contractor (1)has a satisfactory record of performance; (2)is qualified legally to contract with the state;and (3)has supplied all necessary information in connection with the inquiry concerning responsibility. (b)The procurement officer may require the prospective contractor to demonstrate the availability of necessary financing,equipment,facilities,expertise,and personnel,by submitting (1)evidence that the contractor possesses the necessary items; (2)acceptable plans to subcontract for the necessary items; (3)adocumented commitment from,or explicit arrangement with,a satisfactory source to provide the necessary items;or (4)other information required by the procurement officer. (c)The state's determination of responsibility does not relieve the contractor from the requirements for performance under the contract. (d)If a prospective contractor supplies information in response to a request for information made by a procurement officer under (b)of this section,information supplied in response to the request is confidential and may not be disclosed unless the prospective contractor gives prior written consent to its disclosure. History History:Eff.1/1/88,Register 104;am 5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.360 2 AAC 12.510.Access to plant or place of business (a)If an inspection is made in the plant or place of business of a contractor or subcontractor,the contractor or subcontractor shall provide without charge all reasonable facilities and assistance for the safety and convenience of the person performing the inspection or testing. (b)On-site inspection of construction shall be performed in accordance with the terms of the contract. Exhibit R-7 Page 31 of 80 History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.410 2 AAC 12.520.Inspection and testing of supplies and services (a)The state will,in its discretion,inspect supplies and services at the contractor or subcontractor's facility,and perform tests to determine whether they conform to solicitation requirements,or,after award,to contract requirements,and are therefore acceptable.Inspections and tests will be conducted at any reasonable time. (b)The chief procurement officer may establish operational procedures governing the testing and trial use of equipment,materials,and other supplies by a state agency,and the application of resulting information and data to specifications or procurements. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.410 2 AAC 12.530.Retention of books and records. Books and records that relate to a state contract or subcontract shall be retained in such a manner that all actual costs related to the contract or subcontract can be easily determined. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.420 2 AAC 12.540.Price analysis The chief procurement officer and the commissioner of transportation and public facilities may establish procedures for price analysis in the bid evaluation process. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 32 of 80 Annotations Authority:AS 36.30.040 2 AAC 12.550.Cost and pricing data A procurement officer may not waive the requirements of AS 36.30.400(a)concerning submission of cost and pricing data. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.400 2 AAC 12.560.Guidelines for cost principles (a)The commissioner of administration,the commissioner of transportation and public facilities,or the chief procurement officer may establish guidelines for cost principles that may be used to determine allow ability of incurred costs for the purpose of reimbursement under contract provisions that provide for the reimbursement of costs. (b)Cost principles may be modified by contract upon approval of the head of the using agency. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 2 AAC 12.570.Use of federal cost principles In dealing with contractors operating according to federal cost principles,such as Defense Acquisition Regulations,Section 15,or Federal Procurement Regulations,Part 1-15,the procurement officer may use the federal cost principles as guidance in contract negotiations. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.480 Article 11 Innovative Procurement Exhibit R-7 Page 33 of 80 Section 575.Conditions for use of innovative procurement. 577.Record of innovative procurement. 2 AAC 12.575.Conditions for use of innovative procurement (a)A request to use an innovative procurement procedure shall be submitted in writing by a purchasing agency to the chief procurement officer or,for construction contracts or procurements of the state equipment fleet,to the commissioner of transportation and public facilities.The agency must include in the written request an explanation of the proposed innovative procurement procedure,how this procedure will achieve the best value,or why it is advantageous to the state due to new state needs, unique state needs,or new technologies. (b)Following approval under (a)of this section,the requesting agency shall submit a detailed procurement plan to the Department of Law for review and approval as to form before issuing public notice as required under AS 36.30.130.The plan shall,at a minimum,address the method of solicitation, scope,method of award,protest procedures,and proposed contract provisions.If the plan is submitted for a construction contract,the plan may address the use of a bonus in lieu of preferences. History History:Eff.11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.308 2 AAC 12.577.Record of innovative procurement (a)An agency that,under 2 AAC 12.575,requests use of innovative procurement shall maintain its innovative procurement files open for inspection as required under AS 36.30.140(b)and AS 36.30.230. The innovative procurement files must contain: (1)a copy of the contract; (2)the written determination of the chief procurement officer or the commissioner of transportation and public facilities to use the innovative procurement procedure; (3)the procurement plan as approved to form by the Department of Law; (4)the record of notice as required under AS 36.30.130;and (5)the record of respondents to the solicitation. (b)Asummary of the information contained in a file described in (a)of this section will be provided by the requesting agency to the commissioner of the Department of Administration. History History:Eff.11/28/97,Register 144 Annotations Authority:AS 36.30.140(b) Exhibit R-7 Page 34 of 80 AS 36.30.230 AS 36.30.522 Article 12 Supply Management Section 580.Inventories. 590.Supplies inventory records. 600.State surplus supplies. 610.Federal surplus material program. 2 AAC 12.580.Inventories The chief procurement officer,the commissioner of transportation and public facilities,and the head of a purchasing agency may establish procedures to determine appropriate stock levels and the management of agency supplies. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 2 AAC 12.590.Supplies inventory records (a)State agencies shall submit inventory records as directed by the chief procurement officer.Inventory records must include the following: (1)all nonconsumable supplies with a unit acquisition cost of more than $5,000; (2)supplies determined by the chief procurement officer to be sensitive,regardless of cost; (3)lease purchase or installment purchase equipment or long term rental equipment;and (4)supplies on loan for contractor or grantee use. (b)Inventory records must be based on a physical inventory and adjusted for subsequent purchases, property traded in,transferred to another state agency,salvaged,or disposed of. (c)Astate agency may be required by the chief procurement officer to take physical inventory of supplies annually and at other times as the chief procurement officer directs. (d)Theft of supplies valued at $500 or more shall be immediately reported to the appropriate law enforcement agency.All lost,stolen,or destroyed supplies shall be reported to the chief procurement officer by the agency. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 11/28/97,Register 144;am 2/28/2014, Register 209 Exhibit R-7 Page 35 of 80 Annotations Authority:AS 36.30.040 AS 36.30.070 AS 37.05.160 2 AAC 12.600.State surplus supplies (a)The chief procurement officer may act on behalf of the state in all matters pertaining to the disposition of surplus supplies.A purchasing agency may not transfer or otherwise dispose of supplies owned by the state without separate statutory authorization or authorization of the chief procurement officer.The authorization,if granted by the chief procurement officer,shall be in writing and include disposal procedures.This subsection does not apply to disposition of surplus supplies by the University of Alaska,the Alaska Court System,or the legislative branch. (b)A purchasing agency shall notify the chief procurement officer of all surplus supplies on the forms and at the times prescribed by the chief procurement officer. (c)The chief procurement officer shall offer surplus supplies through spot bids,competitive sealed bids, public auction,established markets,lease,trade or posted prices.If unusual circumstances render the methods required by this subsection impractical,the chief procurement officer may employ other disposition methods,including appraisal or barter. (d)If the chief procurement officer offers surplus supplies by competitive sealed bid,notice of sale of the surplus supplies must be publicly available from the chief procurement officer at least 10 days before the date set for opening bids. (e)An employee,contractor,or grantee of an agency that owns or disposes of surplus supplies may not directly or indirectly purchase or agree with another person to purchase surplus supplies if the employee,contractor,or grantee is,or has been,directly or indirectly involved in the disposal, maintenance,or preparation for sale of the surplus supplies.However,the chief procurement officer may authorize the employee,contractor,or grantee to purchase surplus supplies in advance in writing. (f)The chief procurement officer may offer surplus supplies by negotiated sale,transfer,lease,or donation to local governments,public procurement units,or tax exempt nonprofit organizations when the chief procurement officer determines it to be in the state's best interests. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.070 2 AAC 12.610.Federal surplus material program The Department of Administration will,in its discretion,acquire and distribute from the United States Government surplus property that may be usable and necessary for public purposes by a state agency or a political subdivision of the state.The chief procurement officer may (1)prepare and file a state plan of operation with the United States General Services Administration; Exhibit R-7 Page 36 of 80 (2)act on behalf of the state with federal agencies or other surplus property agencies regarding federal surplus property;and (3)distribute federal surplus property to eligible entities. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.070 Article 13 Legal and Contractual Remedies Section 615.Protest of cancellation of solicitation. 620.Decision to suspend. 630.Initiation of debarment action. 640.Effect of debarment decision. 650.Request for hearing. 660.Notice of time and place of hearing. 670.Hearing procedures. 680.Reporting suspected anticompetitive practices. 690.Misrepresentations and fraudulent claims. 695.Protests of small procurements. 2 AAC 12.615.Protest of cancellation of solicitation (a)Repealed 11/28/97. (b)An interested party may protest the cancellation of an invitation to bid or request for proposals by filing with the procurement officer a written protest that includes the information required by AS 36.30.560 no more than 10 days after a notice of cancellation is issued by the procurement officer. History History:Eff.3/30/90,Register 113;am 3/27/93,Register 125;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 2 AAC 12.620.Decision to suspend (a)If a determination to suspend a contractor or prospective contractor is made under AS 36.30.635, the written decision shall be sent to the person to be suspended.The decision must state that Exhibit R-7 Page 37 of 80 (1)the suspension is for the period it takes to complete an investigation into possible debarment,but not for a period in excess of three months; (2)bids or proposals will not be solicited from the suspended person,and,if they are received,they will not be considered during the period of suspension;and (3)if a hearing has not been held,the suspended person may request a hearing. (b)A contractor or prospective contractor is suspended upon issuance of the written decision to suspend.The suspension remains in effect during an appeal.The suspension may be ended by the officer who issued the written decision to suspend or by a court.Otherwise,the suspension ends when it has been in effect for three months or when a debarment decision takes effect. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.635 2 AAC 12.630.Initiation of debarment action (a)Written notice of a proposed debarment action shall be sent by certified mail,return receipt requested,to the last known address of the contractor or prospective contractor.This notice must (1)state that debarment is being considered; (2)set out the reasons for the action; (3)state that the contractor or prospective contractor may be represented by counsel. (b)Notice of proposed debarment must also be sent to the attorney general and the purchasing agency. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.635 2 AAC 12.640.Effect of debarment decision A debarment decision takes effect upon issuance of the written decision.After the debarment decision takes effect,the contractor remains debarred until a court or the commissioner of the department that issued the decision orders otherwise,or until the debarment period specified in the decision expires. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 Exhibit R-7 Page 38 of 80 AS 36.30.635 2 AAC 12.650.Request for hearing A person entitled to a hearing under AS 36.30 must request in writing that a hearing be held.The request must be received by the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,within the applicable time period set out in AS 36.30 and must set out specific grounds for the hearing. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.695 2 AAC 12.660.Notice of time and place of hearing The hearing officer shall send a written notice of the time and place of a hearing to the last known addresses of the person requesting the hearing and other affected persons.A copy shall be sent to the purchasing agency. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.670 2 AAC 12.670.Hearing procedures (a)A hearing shall be as informal as is reasonable and appropriate under the circumstances.The weight to be attached to evidence presented is within the discretion of the hearing officer.Stipulations of fact agreed upon by the parties may be regarded and used as evidence at the hearing.The hearing officer may require evidence in addition to that offered by the parties. (b)A hearing shall be recorded.All evidence produced at a hearing shall be preserved by the commissioner of the Department of Administration or the commissioner's designee. (c)Opening statements may be made at the hearing at the discretion of the hearing officer. (d)The particular principles of law listed in AS 36.30.860 will be considered by the hearing officer if they are specifically argued by a party. (e)A witness must testify under oath or affirmation.A witness may be cross-examined. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Exhibit R-7 Page 39 of 80 Annotations Authority:AS 36.30.040 AS 36.30.670 2 AAC 12.680.Reporting suspected anticompetitive practices The chief procurement officer,in consultation with the attorney general,shall develop procedures, including forms,for reporting suspected anticompetitive practices.A procurement officer who suspects that an anticompetitive practice has occurred or may be occurring shall follow these procedures. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.635 AS 36.30.920 2 AAC 12.690.Misrepresentations and fraudulent claims In accordance with AS 36.30.687,upon a finding that the recipient of a state contract made misrepresentation or fraudulent claims at any stage of proceedings relating to a procurement or contract controversy the procurement officer or the head of a purchasing agency may,after consulting with the attorney general,declare the contract void. History History:Eff.1/1/88,Register 104;11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.687 2 AAC 12.695.Protests of small procurements (a)An interested party shall attempt to informally resolve a dispute with the procurement officer regarding a small procurement.If the attempt is unsuccessful,the interested party may protest the solicitation or the award of a small procurement contract under AS 36.30.320.The protest must be filed with the commissioner of the purchasing agency or the commissioner's designee.The protester must file a copy of the protest with the procurement officer for the purchasing agency. (b)If protesting a solicitation issued under 2 AAC 12.400,a protest shall be filed before the date and time that quotations or informal proposals are due to the purchasing agency. (c)If protesting the award of a small procurement contract of not more than $50,000,the protest shall be filed within 10 days from the date of the solicitation or award,whichever is later. Exhibit R-7 Page 40 of 80 (d)If protesting the award of a small procurement contract greater than $50,000,a protest shall be filed within 10 days from the date that notice of award is made. (e)To be accepted by the purchasing agency,a protest filed under (a)-(d)of this section shall contain the information required under AS 36.30.560. (f)The procurement officer shall immediately give notice of the protest to the contractor or,if no award has been made,to all firms or persons that were solicited for the small procurement. (g)The appropriate commissioner or commissioner's designee shall (1)with the concurrence of the protester,assign the protest to the procurement officer or other responsible state official for a final administrative resolution under alternate dispute resolution; (2)issue a decision denying the protest and stating the reasons for denial; (3)issue a decision that sustains the protest,in whole or in part,and instruct the procurement officer to implement an appropriate remedy;or (4)conduct a hearing on the protest consistent with the procedures contained in AS 36.30.670(b). History History:Eff.4/25/97,Register 142;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.550 Article 14 Intergovernmental Relations Section 700.Requests for personnel,information,and services. 710.Definition. 2 AAC 12.700.Requests for personnel,information,and services (a)A request made to a public procurement unit by another public procurement unit to provide or make available personnel,services,information,or technical services under AS 36.30.730 must be complied with only to the extent that is mutually agreed upon. (b)A request made to a state public procurement unit by another state public procurement unit to provide or make available personnel,services,information,or technical services under AS 36.30.730 must comply with the procedures established by the office of management and budget. (c)Arequest made to a state public procurement unit by another public procurement unit to provide or make available personnel,services,information,or technical services under AS 36.30.730 must comply with AS 37.07,the Executive Budget Act. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 41 of 80 Annotations Authority:AS 44.17.030 Ak.Const., Art.lll,sec.1 Ak.Const., Art.Ill,sec.16 Ak.Const., Art.Ill,sec.24 2 AAC 12.710.Definition In AS 36.30.790(5),"agency"means the same as in AS 36.30.990. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 44.17.030 Ak.Const., Art.lll,sec.1 Ak.Const., Art.Ill,sec.16 Ak.Const., Art.Ill,sec.24 Article 15 Miscellaneous Provisions Section 720.Applicability. 725.Procurement limitations relating to human trafficking. 730.Federal assistance. 735.Use of federal general services administration contracts. 740.Authority to delegate. 750.Purchase requests by agencies. 760.Purchase of items separately from construction contract. 770.Trade secrets and confidential technical data. 780.Determination of contractual terms and conditions. 790.No restrictive terms and conditions. 800.Non-collusion certification. 810.Bid,payment,and performance bonds for contracts. 820.Installment purchase contracts. 830.Alternate bids or proposals. Exhibit R-7 Page 42 of 80 840.Conditioning bids or proposals. 850.Extension of solicitation opening time;cancellation of solicitation;amendment of solicitation. 860.Rejection of all bids or proposals. 870.Rejection of individual bids or proposals. 875.Qualified bidders or offerors. 880.Disposition of bids or proposals. 890.Application of preferences. 900.Tied bids or proposals. 910.Extension of time for bid or proposal acceptance. 920.Multiple award. 2 AAC 12.720.Applicability This chapter applies to every transaction to which AS 36.30 applies. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.850 2 AAC 12.725.Procurement limitations relating to human trafficking (a)Procurement may not be made from a person that has headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C). (b)The commissioner may restrict procurement from a person that conducts business in,but does not have headquarters in,a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C). History History:Eff.1/15/2011,Register 197 Annotations Authority:AS 36.30.040 2 AAC 12.730.Federal assistance If a procurement involves the expenditure of federal money or requires federal assistance and there is a conflict between a provision of this chapter and a federal statute,regulation,policy,or requirement,the procurement officer shall comply with the federal statute,regulation,policy,or requirement. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 43 of 80 Annotations Authority:AS 36.30.040 AS 36.30.8390 2 AAC 12.735.Use of federal general services administration contracts When making or planning a purchase through the General Services Administration or from federal supply schedules of the General Services Administration as authorized by AS 36.30.910,a procurement officer (1)shall review the scheduled price lists that are reasonably available when purchasing through the General Services Administration under AS 36.30.910 or from federal supply schedules; (2)may not purchase under this section if a mandatory state contract exists for the item or service; (3)shall place the order with the schedule contractor offering the lowest delivered price unless the purchase is made under (4)of this section; (4)may order an item that has a higher price than the lowest delivered price but only if the procurement officer makes a written determination that only the higher priced item will satisfy the state's needs;and (5)may purchase only from a person that qualifies as an Alaska bidder under AS 36.30.990(2). History History:Eff.11/28/97,Register 144;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.910 2 AAC 12.740.Authority to delegate (a)Except as otherwise provided by AS 36.30 or this chapter,the chief procurement officer, commissioner of administration,commissioner of transportation and public facilities,or the commissioner of commerce,community,and economic development will,in their discretion,delegate their authority under AS 36.30 to an employee in a department or agency.Authority conferred on the head of a purchasing agency by AS 36.30 may be delegated by that officer to an employee in that purchasing agency.A delegation of authority must be in writing (b)The chief procurement officer,commissioner of administration,commissioner of transportation and public facilities,commissioner of commerce,community,and economic development,or the head of a purchasing agency may revoke authority that the officer has delegated. (c)An employee delegated authority by the chief procurement officer,commissioner of administration, commissioner of transportation and public facilities,commissioner of commerce,community,and economic development,or the head of a purchasing agency,may exercise that authority only in accordance with the delegation,AS 36.30,and this chapter. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 44 of 80 Annotations Authority:AS 36.30.040 AS 36.30.015 Editor's note:As of Register 171 (October 2004),the regulations attorney made technical revisions under AS 44.62.125(b)(6)to reflect the name change of the Department of Community and Economic Development to the Department of Commerce,Community,and Economic Development made by Ch.47,LA 2004 and the corresponding title change of the commissioner of community and economic development. 2 AAC 12.750.Purchase requests by agencies (a)If the chief procurement officer believes that a purchase request is not in the best interests of the state or that further review is needed,the officer shall return the purchase request to the requesting agency. (b)The chief procurement officer may decide when a procurement will be initiated. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 2 AAC 12.760.Purchase of items separately from construction contract The commissioner of transportation and public facilities is authorized to determine whether a supply item or group of supply items will be included as a part of,or procured separately from,a contract for construction. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.005 AS 36.30.040 2 AAC 12.770.Trade secrets and confidential technical data The chief procurement officer and the commissioner of transportation and public facilities may establish procedures to protect the confidentiality of trade secret and confidential technical data. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 45 of 80 Annotations Authority:AS 36.30.040 AS 36.30.140 AS 36.30.230 2 AAC 12.780.Determination of contractual terms and conditions (a)The chief procurement officer may determine the contractual provisions,terms,and conditions of solicitations and contracts,if the provisions,terms,and conditions are not contrary to statutory or regulatory requirements governing the procurement and if all standard contract terms have been reviewed and approved as to form by the attorney general. (b)The commissioner of transportation and public facilities may determine the contractual provisions and conditions of solicitations and contracts for construction and procurement of equipment or services for the state equipment fleet if the provisions,terms,and conditions are not contrary to statutory or regulatory requirements governing the procurement,and if all standard contract terms have been reviewed and approved as to form by the attorney general. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.340 2 AAC 12.790.No restrictive terms and conditions Contractual terms and conditions may not have the effect of unnecessarily limiting competition or exclusively requiring a proprietary supply,service,or construction item or procurement from a single source unless no other requirements will suffice. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.060 2 AAC 12.800.Non-collusion certification Solicitations must provide that by submitting a bid or offer,the bidder or offeror certifies under penalty of perjury that the price submitted was independently arrived at without collusion. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 46 of 80 Annotations Authority:AS 36.30.040 2 AAC 12.810.Bid,payment,and performance bonds for contracts Bid,payment,and performance bonds or other security shall be required for all construction contracts over $100,000,and may be required for contracts as the chief procurement officer,the head of a purchasing agency,or the officer's designee deems advisable to protect the interests of the state.Any such requirements must be set out in the solicitation.Irrevocable letters of credit may be substituted for the required bond at the discretion of the head of the purchasing agency. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.120 2 AAC 12.820.Installment purchase contracts Supply contracts may provide for installment purchase payments,including interest charges,over a period of time.If the procurement is made by competitive sealed bid or competitive sealed proposal,an installment payment agreement may not be used unless provision for installment payments is included in the solicitation. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 2 AAC 12.830.Alternate bids or proposals Alternate bids or proposals are nonresponsive unless the solicitation states that such bids or proposals may be accepted. History History:Eff.1/1/88,Register 104;am 3/27/93,Register 125 Annotations Authority:AS 36.30.040 AS 36.30.110 AS 36.30.210 Exhibit R-7 Page 47 of 80 2 AAC 12.840.Conditioning bids or proposals (a)A bid or proposal that is conditioned upon receiving award of both the particular contract being solicited and another state contract is nonresponsive unless conditioned bids are specifically authorized in the invitation to bid. (b)A bid that is conditioned by the bidder and the condition requires a change to a material term of the solicitation is nonresponsive unless conditioned bids are specifically authorized in the invitation to bid. (c)A proposal that is conditioned by the offeror and the condition requires a change to a material term of the solicitation may be rejected.The reasons for the rejection include the following: (1)the condition does not meet the goals of the solicitation; (2)the condition would violate AS 36.30 or other statutes and regulations; (3)the condition is not in the best interest of the state. (d)For purposes of this section,"material term"includes a (1)novation or assignment; (2)term that affects price,quality,quantity,or delivery. History History:Eff.1/1/88,Register 104;am 10/3/2002,Register 163 Annotations Authority:AS 36.30.040 AS 36.30.110 AS 36.30.210 2 AAC 12.850.Extension of solicitation opening time;cancellation of solicitation;amendment of solicitation (a)Before the opening of bids or proposals,a solicitation may be amended,or time for opening may be extended,upon the procurement officer's determination that the extension or amendment is in the state's best interest.All potential bidders or offerors known to have copies of the solicitation shall be advised of the extension or amendment. (b)Before the opening of bids or proposals,a solicitation may be cancelled in whole or in part if the chief procurement officer or the head of a purchasing agency issuing a solicitation determines that cancellation is in the state's best interest.Reasons for cancellation include the following: (1)the state no longer requires the supplies,services,or construction; (2)the state no longer can reasonably expect to pay for the procurement; (3)proposed amendments to the solicitation would be of such magnitude that a new solicitation is desirable;or (4)the officer,after consultation with the attorney general,determines that a solicitation is in violation of the law. History History:Eff.1/1/88,Register 104 Exhibit R-7 Page 48 of 80 Annotations Authority:AS 36.30.040 AS 36.30.350 2 AAC 12.860.Rejection of all bids or proposals After the opening of bids or proposals or after notice of intent to award but before award,all bids or proposals may be rejected in whole or in part by the chief procurement officer or the head of a purchasing agency issuing the solicitation.Reasons for rejection include the following: (1)the supplies,services,or construction being procured are no longer required; (2)ambiguous or otherwise inadequate specifications were part ofthe solicitation; (3)the solicitation did not provide for consideration of all factors of significance to the state; (4)prices exceed available money and it would not be appropriate to adjust quantities to accommodate available money; (5)all otherwise acceptable bids or proposals received are at unacceptable prices; (6)there is reason to believe that the bids or proposals may not have been independently arrived at in open competition,may have been collusive,or may have been submitted in bad faith;or (7)the award is not in the best interests of the state. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 AS 36.30.350 2 AAC 12.870.Rejection of individual bids or proposals Reasons for rejecting an individual bid or proposal include the following: (1)the business that submitted the bid or proposal is not responsible as determined under standards set out in 2 AAC 12.500; (2)the bid or proposal is nonresponsive; (3)the bidder or offeror did not meet the qualification requirements of 2 AAC 12.875; (4)the supply,service,or construction item fails to meet the specifications or other acceptability criteria set out in the solicitation;or (5)the bid or proposal fails to meet the goals or other provisions set out in the solicitation to eliminate and prevent in state contracting discrimination because of race,religion,color,national origin,sex,age, marital status,pregnancy,parenthood,or disability. History History:Eff.1/1/88,Register 104;am 5/16/88,Register 106;am 6/29/95,Register 134;am 10/3/2002, Register 163 Exhibit R-7 Page 49 of 80 Annotations Authority:AS 36.30.040 AS 36.30.350 2 AAC 12.875.Qualified bidders or offerors (a)Unless provided for otherwise in the solicitation,to qualify as a bidder or offeror for award of a contract issued under AS 36.30,a bidder or offeror must (1)add value in the contract by actually performing,controlling,managing,or supervising the services to be provided;or (2)be in the business of selling and have actually sold on a regular basis the supplies that are the subject of the solicitation. (b)If a bidder or offeror leases services or supplies or acts as a broker or agent in providing the services or supplies in order to meet the requirements of (a)of this section,the procurement officer may not accept the bidder or offeror as a qualified bidder or offeror under AS 36.30. History History:Eff.10/3/2002,Register 163 Annotations Authority:AS 36.30.040 2 AAC 12.880.Disposition of bids or proposals (a)If an invitation to bid is canceled before opening,bids may be returned upon request.If bids are rejected after opening,the bids must be retained in the procurement file. (b)If anytime during the solicitation process a request for proposals is canceled,the procurement officer may return proposals if the time for filing a protest has expired and a protest has not been filed. (c)The procurement officer shall keep a list of returned bids or proposals in the procurement file. History History:Eff.1/1/88,Register 104;am 11/28/97,Register 144 Annotations Authority:AS 36.30.040 AS 36.30.230 AS 36.30.250 AS 36.30.350 2 AAC 12.890.Application of preferences Except for the Alaska products preference under AS 36.30.328,if multiple preferences apply to a solicitation,the values of the applicable preferences shall be summed and applied to the qualifying bid. If applying the Alaska products preference,the preference shall only be applied to the qualifying product. Exhibit R-7 Page 50 of 80 History History:Eff.1/1/88,Register 104;am 7/20/95,Register 135;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.321 AS 36.30.328 AS 36.30.336 2 AAC 12.900.Tied bids or proposals Tied bids are low bids that are responsive,responsible,and identical in price after application of preferences under AS 36.30.321.Tied proposals are highest ranked proposals that are responsive, responsible,and identical in score after application of preferences under AS 36.30.321.If tied bids or proposals exist,award shall be made through a random drawing.Award may not be made by dividing the procurement among identical bidders. History History:Eff.1/1/88,Register 104;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 AS 36.30.150 2 AAC 12.910.Extension of time for bid or proposal acceptance After opening bids or proposals,a procurement officer may request bidders or offerors to extend the time during which the state may accept a bid or proposal. History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 2 AAC 12.920.Multiple award A multiple award may be made if award to two or more bidders or offerors of similar products is necessary for adequate delivery,service,or product compatibility.A multiple award shall be made in accordance with the provisions relating to competitive sealed bidding,competitive sealed proposals, small purchases,and emergency procurements,as applicable.Multiple awards may not be made if a single award will meet the state's needs without sacrifice of economy or service.Awards may not be made for the purpose of dividing the procurement,or to allow for user preference unrelated to utility or economy. Exhibit R-7 Page 51 of 80 History History:Eff.1/1/88,Register 104 Annotations Authority:AS 36.30.040 Article 16 Design-Build Construction Contracts Section 931.Purpose. 933.General design-build requirements. 935.Design-builders. 937.Development of performance criteria. 939.Solicitation of proposals. 941.Preparation and submission of proposals. 943.Evaluation and award of design-build contracts. 945.Protests and claims. 949.Definitions. 2 AAC 12.931.Purpose The provisions of 2 AAC 12.931 -2 AAC 12.949 set out requirements for the procurement and administration under AS 36.30.200(c)of design-build construction contracts. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.933.General design-build requirements (a)The procurement officer may conduct a design-build procurement process only if the commissioner of transportation and public facilities determines in writing that it is advantageous to the state. (b)When a design-build procurement process is used,the request for proposals must solicit a single price for both design and construction services.Nothing in this subsection prohibits a multi-step award process. (c)The provisions of 2 AAC 12.931 -2 AAC 12.949 apply to,and are incorporated in,all design-build construction contracts entered by an agency. (d)Design-build construction contracts must be procured (1)in accordance with AS 36.30.200 -36.30.265;and Exhibit R-7 Page 52 of 80 (2)except as provided in 2 AAC 12.931 -2 AAC 12.949,in accordance with 2 AAC 12.220 -2 AAC 12.315 (Competitive Sealed Proposals);in the case of inconsistency with 2 AAC 12.220 -2 AAC 12.315,the provisions of 2 AAC 12.931 -2 AAC 12.949 control. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.935.Design-builders (a)A design-builder must have a valid business license issued under AS 43.70 and 12 AAC 12,and must be (1)registered as a general contractor in accordance with AS 08.18 and 12 AAC 21;or (2)licensed as an architect or engineer in accordance with AS 08.48 and 12 AAC 36. (b)A design-builder may provide professional or construction services that the design-builder is not itself licensed or registered to provide,if those services are assigned or subcontracted to a person that (1)is a member of the design-build team; (2)has a valid business license issued under AS 43.70 and 12 AAC 12;and (3)is registered or licensed to provide the services in accordance with AS 08.18 and 12 AAC 21,or with AS 08.48 and 12 AAC 36,as applicable. (c)The agency shall evaluate a design-builder for at least the following qualification factors: (1)bonding capacity; (2)financial strength and capabilities; (3)experience and technical expertise with projects of similar size and scope; (4)past performance; (5)qualifications and experience of key management and professional staff who will be assigned to the project; (6)the capacity to accomplish work in the required time;as part of the evaluation,the agency shall consider,and the design-builder must disclose,the design-builder's present workload; (7)quality control and quality assurance policies and programs; (8)the design-builder's safety record,to include safety and drug-testing policies and programs; (9)equipment,including technical resources and information technology; (10)a subcontracting plan,including the qualifications and capabilities of any subcontractor required to be identified by the request for proposals. (d)When evaluating a design-builder,the agency shall act in accordance with AS 36.30.250(b). {e)The agency shall preclude or disqualify a design-builder or member of the design-build team from participation in a design-build construction contract if the procurement officer determines that the design-builder or design-build team member has an unfair competitive advantage or a conflict of interest. Exhibit R-7 Page 53 of 80 (f)A consultant or subconsultant to the agency may not be allowed to participate in a project in other than a consultant or subconsultant capacity unless the procurement officer determines that (1)the role of the consultant or subconsultant (A)was limited to provision of preliminary design,reports,or similar low-level documents that will be incorporated in to the request for proposals;and (B)did not include assistance in the development of instructions to offerors,qualification factors, performance criteria,or other evaluation criteria;or (2)each document or report that the consultant or subconsultant delivered to the agency is made available to all offerors. (g)With or without a request from the agency,a design-builder,or a member of the design-build team, must promptly disclose to the agency,in writing,any factor that may provide an unfair competitive advantage or potential or actual conflict of interest for the design-builder or design-build team member. (h)Nothing in 2 AAC 12.931 -2 AAC 12.949 limits or eliminates any responsibility or liability that a professional on a design-build construction contract owes to the agency or to a third party. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.937.Development of performance criteria The agency shall establish the scope and level of detail required for performance criteria contained ina request for proposals.The performance criteria must be detailed enough to permit offerors to submit proposals in accordance with the request for proposals. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.939.Solicitation of proposals (a)The agency shall prepare a request for proposals for each design-build construction contract.The request for proposals must contain,at a minimum,the following elements: (1)the name and purpose of the project; (2)the identity of the agency that will award the design-build construction contract; (3)a description of the method selected under 2 AAC 12.943(a)as the basis for awarding the design- build construction contract; Exhibit R-7 Page 54 of 80 (4)the procedures to be followed for submitting proposals,the criteria for evaluation of proposals and their relative weight,the procedures for making awards,and a statement that the requirements of 2 AAC 12.931 -2 AAC 12.949 are incorporated; (5)the date on or before which the agency must receive proposals;that date may not be less than 21 days after issuance of the request for proposals; (6)provisions for the payment of a stipend,if any; (7)provisions specifying ownership of design plans or concepts or of technical plans or concepts; (8)the proposed contract form,terms,and conditions; (9)performance criteria developed under 2 AAC 12.937,including,as appropriate,capacity,durability, and production standards,ingress and egress requirements,and other criteria for the intended use of the project,expressed in performance-oriented drawings and specifications suitable to allow the design- builder to make a proposal; (10)a description of the drawings,specifications,or other required submittals,with guidance as to the form and level of completeness that will be acceptable;that description must include a description of the submittal review process; (11)a schedule for planned commencement and completion of the design-build construction contract, unless contract time is to be proposed by the design-builder and is one of the weighted proposal evaluation criteria; (12)budget limits,if any,for the design-build construction contract; (13)affirmative action,disadvantaged business,or set-aside goals,if any,for the design-build construction contract; (14)the qualifications the design-builder will be required to have; (15)detailed material quality standards; (16)the method for handling pre-proposal inquiries; (17)long-term maintenance provisions,if any; (18)a reference to the provisions of 2 AAC 12.935(e)and (f); (19)a requirement that an offeror provide,in the offeror's proposal,information regarding actual or potential conflicts of interest; (20)requirements related to changes in design-build team members or changes in personnel within design-build teams; (21)each evaluation factor,including cost or price,and including each significant subfactor,if any,that will affect the award of the design-build construction contract; (22)the relative importance of each evaluation factor and each subfactor,if any,in determining the award of the design-build construction contract; (23)a requirement that the design-builder review the request for proposals to ascertain the project requirements,and a requirement that the design-builder notify the agency in the event of any ambiguity or uncertainty; (24)terms or conditions detailing incentives,disincentives,or liquidated damages,if any; (25)warranty provisions;the request for proposals must include notice that in addition to warranting materials,workmanship,and construction,and providing any additional warranties that the agency requires,a design-builder must warrant the design of the project; Exhibit R-7 Page 55 of 80 (26)notice that the design-builder must provide,in a form and amount acceptable to the agency, insurance coverage for a defined period after final payment for the cost of (A)correcting defects or deficiencies arising from or associated with design or construction negligence; (B)errors or omissions;and (C)legal defense and payment of indemnity; (27)identification of the disciplines to be evaluated. (b)In a request for proposals,an agency may require a cash deposit,letter of credit,or bond not to exceed five percent of the maximum cost of the design-build construction contract,as established by the proposal. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 Editor's note:As of Register 181 (April 2007),the regulations attorney made a technical revision under AS 44.62.125(b)(6),to 2 AAC 12.939(a){18). 2 AAC 12.941.Preparation and submission of proposals (a)An offeror must submit its proposal to the agency at the specific place and at or before the specific time identified in the request for proposals. (b)An offeror must complete any form required in the request for proposals and provided by the agency.The offeror must include with its proposal each completed form and any necessary attachment or additional information. (c)Proposals shall be sealed and may not be opened until expiration of the time set in the request for proposals for submitting proposals. (d)If the request for proposals requires a cash deposit or bond as described in 2 AAC 12.939(b),the deposit or bond is subject to forfeiture if the proposal is accepted but the offeror fails to execute the design-build construction contract. (e)For each discipline that an agency identifies in the request for proposals,proposals must identify each person within that discipline to whom the offeror proposes to subcontract obligations under the design-build construction contract.A person that the offeror identifies may not be replaced without the approval of the agency. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 Exhibit R-7 Page 56 of 80 2 AAC 12.943.Evaluation and award of design-build contracts (a)The agency shall use one or a combination of the following methods as a basis for award unless the commissioner of transportation and public facilities approves another method: (1)the best value method,in which the agency gives numerical scores to technical proposals,and then uses those numerical scores and the bid price to establish a best value in accordance with a formula published in the request for proposals; (2)the two-step method,in which the agency (A)first,uses a request for qualifications and the qualification factors under 2 AAC 12.935 to short-list offerors;the request for qualifications must contain,at a minimum,the following elements: (i)the date on or before which the agency must receive qualifications submissions;that date may not be less than 21 days after issuance of the request for qualifications; (ii)the qualifications the offerors will be required to have; (iii)a description of the project in enough detail to let offerors determine if they wish to compete and to form the basis for their qualification submissions; {iv)qualification factors and their relative weights; (v)identification of the maximum number of offerors that will be permitted,at the second step described in (B)of this paragraph,to submit price and technical proposals;the maximum number may not exceed five offerors,unless the procurement officer determines that a maximum number greater than five is in the best interest of the state;and (B)second,uses a request for proposals to evaluate price and technical proposals from the offerors that are short-listed; (3)the low-bid method,in which (A)an offeror must submit a technically qualified proposal in order for the agency to consider the bid; and (B)the agency awards the design-build construction contract to the offeror that submits a proposal that is technically qualified and lowest price. (b)If an agency uses a request for qualifications to short-list offerors,the agency shall issue notice of the request for qualifications in accordance with 2 AAC 12.130. (c)To evaluate either submissions made in response to a request for qualifications or submissions made in response to a request for proposals,the agency may form evaluation committees.To assist in the evaluation process,an evaluation committee may retain the services of non-voting members,including consultants or subconsultants. (d)An agency is not required to award a design-build construction contract as a result of a request for proposals.In accordance with 2 AAC 12.270,2 AAC 12.860,and 2 AAC 12.870,the agency may reject a proposal. (e)Notice of intent to award a design-build construction contract shall be issued in accordance with 2 AAC 12.210. (f)The award of a design-build construction contract,if any,shall be made in accordance with AS 36.30.250. (g)tf the agency awards a design-build construction contract,the agency shall execute the contract and issue the successful offeror a written notice to proceed. Exhibit R-7 Page 57 of 80 (h)At the time of award of a design-build construction contract,the agency may negotiate minor changes with the selected offeror for the purpose of clarifying the design criteria and work to be done,if the negotiated changes do not affect the ranking of the proposals based on their adjusted scores. (i)In this section, (1)"short-list”means to narrow the field of offerors through the selection of the most qualified offerors who have responded to a request for qualifications; (2)"technical proposal”means the portion of a proposal that contains design solutions and other qualitative factors that are provided in response to the request for proposals. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 AS 36.30.350 AS 36.30.365 2 AAC 12.945.Protests and claims Protests and claims arising from the procurement process under 2 AAC 12.931 -2 AAC 12.949 shall be reviewed in accordance with AS 36.30.550 -36.30.699,as applicable. History History:Eff.8/21/2005,Register 175 Annotations Authority:AS 36.30.040 AS 36.30.200 2 AAC 12.949.Definitions In 2 AAC 12.931 -2 AAC 12.949,unless the context requires otherwise, (1)"agency"means (A)the Department of Transportation and Public Facilities;or (B)an agency within the meaning of AS 36.30.990 to which the commissioner of transportation and public facilities has delegated,under AS 36.30.015,authority to contract for construction; (2)"design-build construction contract,"within the meaning given in AS 36.30.990,means a construction contract between an agency and a design-builder to furnish architecture,engineering,and related design services,and to furnish construction services,including labor and materials. History History:Eff.8/21/2005,Register 175 Exhibit R-7 Page 58 of 80 Annotations Authority:AS 36.30.040 AS 36.30.200 Article 17 Construction Arbitration Procedures Section 950.Arbitration agreement. 952.Arbitration request. 954.Answering statement. 956.Referral to arbitrator. 958.Arbitrator list. 960.Arbitrator referral. 962.Recusal,disclosure,and challenge. 964.Vacancies. 966.Communication with arbitrator and service of documents. 968.Public access. 970.Preliminary conference. 972.Discovery and exchange of information. 974.Attendance. 976.Conduct of arbitration. 978.Authority of arbitrator. 980.Evidence. 982.Burden of proof. 984.Record and transcript. 986.Form of decision. 987.Attorneys fees and costs. 988.Rules of procedure. 989.Definitions for construction arbitration procedures. 2 AAC 12.950.Arbitration agreement (a)This chapter applies to,and its provisions are incorporated in,all construction contracts entered by the Department of Transportation and Public Facilities. (b)A person entering a construction contract with the Department of Transportation and Public Facilities and who requests or agrees to arbitration of a claim involving that contract will be considered to have agreed to arbitration of construction claims as provided in AS 36.30 (State Procurement Code) and 2 AAC 12.950 -2 AAC 12.989. Exhibit R-7 Page 59 of 80 History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.952.Arbitration request (a)To initiate arbitration under AS 36.30.627(a)(1),a contractor must file a written arbitration request with the commissioner.The arbitration request must be filed together with the appeal from the procurement officer's decision required by AS 36.30.625. (b)The arbitration request must state the amount ofthe claim and must describe the claim in sufficient detail to make the circumstances of the dispute clear to the arbitrator. (c)The contractor shall certify that the claim is made in good faith,that the supporting data are accurate and complete to the best of the contractor's knowledge and belief,and that the amount ofthe claim accurately states the amount for which the contractor believes the state is liable. (d)The contractor shall serve a copy of the arbitration request and the appeal on the procurement officer at the time the contractor files the arbitration request and the appeal with the commissioner. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.627 AS 36.30.870 2 AAC 12.954.Answering statement (a)The procurement officer shall file a written answering statement with the commissioner within 30 days after service of the arbitration request and appeal.The answering statement must raise any counterclaim asserted by the agency.The answering statement must state the amount of the counterclaim and describe the counterclaim in sufficient detail to make the counterclaim clear to the arbitrator. (b)If the amount of the claim and the amount of the counterclaim added together is $250,000 or more, the answering statement must state whether the agency agrees to arbitration of the claim. (c)The procurement officer shall certify that any counterclaim is made in good faith,that the supporting data are accurate and complete to the best of the procurement officer's knowledge and belief,and that the amount of the counterclaim accurately states the amount for which the procurement officer believes the contractor is liable. (d)The procurement officer shall serve a copy of the answering statement upon the contractor at the time the procurement officer files the answering statement with the commissioner. Exhibit R-7 Page 60 of 80 History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.627 AS 36.30.870 2 AAC 12.956.Referral to arbitrator (a)If the total amount of the claim and any counterclaim is less than $250,000,or if the total amount of the claim and any counterclaim is $250,000 or more and the agency agrees to arbitration,the commissioner shall refer the appeal to a single neutral arbitrator. (b)If the total amount of the claim and any counterclaim is more than $1,000,000,and the agency agrees to arbitration,the commissioner may refer the appeal to a panel of three neutral arbitrators.The parties may,by mutual agreement,waive a panel and have the claim and any counterclaim heard by a single arbitrator. (c)The commissioner shall provide the arbitrator or panel with copies of the notice of appeal,the arbitration request,the answering statement,and any supporting documents filed by the parties with the commissioner. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.627 AS 36.30.870 2 AAC 12.958.Arbitrator list (a)The commissioner shall maintain a list of neutral arbitrators who have agreed to conduct arbitrations of construction claims under AS 36.20.627 and 2 AAC 12.950 -2 AAC 12.989. (b)An arbitrator for a claim and any counterclaim that total less than $250,000 must be an (1)attorney licensed under AS 08.08 to practice law in the state,with a minimum of ten years' experience,including experience in the areas of construction law or public procurement law;or (2)architect or engineer licensed under AS 08.48 to practice in the state,with a minimum of ten years' experience,including experience in public construction or public contract administration. (c)An arbitrator for a claim and any counterclaim that total $250,000 or more and that are to be heard by a single arbitrator must be an attorney licensed under AS 08.08 to practice law in the state,with a minimum of ten years'experience,including experience in the areas of construction law or public procurement law. (d)An arbitrator on athree-member arbitration panel for a claim and any counterclaim that total $1,000,000 or more must be an Exhibit R-7 Page 61 of 80 (1)attorney licensed under AS 08.08 to practice law in the state,with a minimum of ten years' experience,including experience in the areas of construction law or public procurement law;or (2)architect or engineer licensed under AS 08.48 to practice in the state,with a minimum of ten years' experience,including experience in public construction or public contract administration;no more than two individuals who qualify under this paragraph may serve on a panel. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.960.Arbitrator referral (a)The commissioner shall serve a copy ofthe current list of arbitrators to the parties following the filing of the answering statement. (b}The parties shall promptly confer and,within 15 days after the date the list was served,shall notify the commissioner as to whether they agree on an arbitrator or,if the commissioner has referred the appeal to a panel under 2 AAC 12.956(b),on three arbitrators,subject to the requirements in 2 AAC 12.958(d)regarding composition of the panel.The parties shall provide the names of the agreed arbitrator or panel to the commissioner. (c)If the parties agree on an arbitrator or a panel,the commissioner shall refer the appeal to that arbitrator or panel. (d)If the parties do not agree on an arbitrator or a panel,each party shall,within 15 days after the date the list was served,strike from the list the name of each arbitrator to whom the party objects,number the remaining names in order of preference,and return the list to the commissioner.The commissioner shall select an arbitrator ora panel from remaining names on the list based on the parties'orders of preference,and shall refer the appeal to that arbitrator or panel. (e)If a party does not return the list to the commissioner within 15 days after the date the list was served,the commissioner may consider all arbitrators on the list to be acceptable to that party.If a party strikes all names from the list,or if,for purposes of assembling a panel,the party does not provide unstruck names sufficient to assemble a panel in accordance with the composition requirements in 2 AAC 12.958(d),the commissioner may select any arbitrator or a panel from the list,and refer the appeal to that arbitrator or panel,subject to recusal,disclosure,and challenge under 2 AAC 12.962. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 Exhibit R-7 Page 62 of 80 2 AAC 12.962.Recusal,disclosure,and challenge (a)An arbitrator shall decline appointment if any circumstance prevents the arbitrator from being impartial or independent,including any bias,any personal or financial interest in the outcome of the arbitration,or any past or present business or personal relationships with the parties or their representatives. (b)An arbitrator shall disclose to the parties any circumstances that might reflect adversely on the arbitrator's impartiality or independence,even if the arbitrator does not believe those circumstances justify recusal. (c)A party may challenge an arbitrator by filing a request for recusal with the commissioner within five days after the date the party receives the arbitrator's disclosure.The request must describe the basis for recusal in sufficient detail to make the alleged grounds clear to the commissioner.A copy shall be served on the other party and the arbitrator.The other party may file and serve a response within five days after service of the request for recusal.The arbitrator may not file a response. (d)After reviewing a request for recusal and the response,if any,the commissioner shall determine whether to recuse the arbitrator.The commissioner's decision is final and binding. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.964.Vacancies (a)If an arbitrator is unable to perform the duties of the office for any reason,including recusal,the commissioner shall appoint a substitute arbitrator in accordance with 2 AAC 12.958 -2 AAC 12.960,and shall reassign the appeal to that arbitrator. (b)If a vacancy occurs in a panel,the remaining arbitrator or arbitrators shall continue with the determination of the dispute,unless the parties jointly request the commissioner to appoint a substitute arbitrator in accordance with 2 AAC 12.958 -2 AAC 12.960. (c)A substitute arbitrator is subject to the same requirements of disclosure,recusal,and challenge under 2 AAC 12.962 as an arbitrator initially appointed. (d)A substitute arbitrator shall promptly review the record and shall resume the appeal process from the point where the previous arbitrator left it. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 Exhibit R-7 Page 63 of 80 2 AAC 12.966.Communication with arbitrator and service of documents (a)A party or a person acting on behalf of a party may not communicate unilaterally with the arbitrator concerning the dispute,except with the other party's authorization and for the limited purpose of scheduling a time,place or date fora proceeding. (b)The arbitrator may not discuss the appeal with any witness or third party and may not comment on the arbitration to the press or public. (c)Correspondence,documents,and electronic mail filed with or delivered to the arbitrator by a party shall be served upon the other party in the manner prescribed for service of pleadings in the Alaska Rules of Civil Procedure. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.968.Public access (a)Correspondence,documents,and electronic mail filed with or delivered to the arbitrator or the commissioner by the parties relating to the appeal,recordings and transcripts of arbitrations,and decisions and orders of the arbitrator or panel are public records. (b)The arbitrator's or panel's notes,drafts,research,and other deliberative materials and work product are confidential. (c)Arbitrations and pre-arbitration proceedings are open to the public. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.970.Preliminary conference (a)The arbitrator may schedule one or more preliminary conferences at the arbitrator's own initiative or at the request of a party.A panel shall designate one of its members to conduct preliminary conferences.Preliminary conferences may be conducted by telephone. (b)At a preliminary conference,the arbitrator shall address any matters relating to scheduling and the future conduct of the case,including clarification of the claims,a schedule for the arbitration,motions, subpoenas,exchange of expert reports,discovery disputes,and any other preliminary matters raised by the parties. (c)After the preliminary conference,requests to postpone a scheduled hearing may only be granted on a showing of good cause. Exhibit R-7 Page 64 of 80 History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.972.Discovery and exchange of information (a)At the request of any party or at the arbitrator's own initiative,the arbitrator may direct the production of documents,the identification of witnesses to be called including the anticipated topics of testimony,and any other discovery that the arbitrator considers necessary or desirable. {b)The arbitrator may direct the parties to prepare and file stipulations of uncontested facts. (c)The arbitrator may not allow discovery other than discovery allowed under AS 09.43.070, AS 36.30.629,and this section,except as ordered by the arbitrator in extraordinary cases and upona clear showing that the interests of justice so require. (d)The arbitrator shall rule on discovery disputes.The arbitrator may impose sanctions,including claim preclusion,if a party fails to comply with the arbitrator's discovery decisions. (e)The arbitrator shall resolve discovery matters in a manner consistent with the expedited nature of arbitration. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.629 AS 36.30.870 2 AAC 12.974.Attendance (a)The parties or their representatives shall attend the arbitration and all related proceedings.A party may be represented by an attorney. {b)If a party or its representative fails to appear at a proceeding,and the arbitrator proceeds in the party's absence as provided in AS 36.30.695(f},a decision may not be entered solely on the grounds of default.The party who is present at a proceeding shall submit such evidence and argument as the arbitrator may require to make a decision. History History:Eff.5/26/2004,Register 170 Exhibit R-7 Page 65 of 80 Annotations Authority:AS 36.30.040 AS 36.30.695 AS 36.30.870 2 AAC 12.976.Conduct of arbitration (a)The parties shall exchange copies of all exhibits they intend to introduce at least five business days before the arbitration,and shall provide each arbitrator with a complete copy of the proposed exhibits. (b)The parties shall each make a brief opening argument at the start of the arbitration. (c)The contractor shall present its evidence in support of the claim.The agency shall then present its evidence opposing the claim and in support of any counterclaim.If a counterclaim is presented,the contractor may present rebuttal evidence. (d)The parties may cross-examine opposing witnesses.The arbitrator may ask questions of witnesses and of the parties or their representatives at any time. (e)Following presentation of the evidence,the parties shall each present a brief closing argument and shall specify the relief requested. (f)The arbitrator shall declare the record on the claim closed when the arbitrator is satisfied that the presentations of the parties are complete. (g)If the arbitrator requests documents or briefs to be filed following the arbitration,the record on the claim shall be declared closed as ofthe final date set by the arbitrator for receipt of the documents or briefs. (h)The time in which,under AS 36.30.695(b),the arbitrator must issue a decision begins to run on the day after the date the record on the claim is declared closed. (i)The arbitrator may vary the procedures in this section,and may limit the time allowed for any of these procedures,if each party is given a fair opportunity to present its case. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.695 AS 36.30.870 2 AAC 12.978.Authority of arbitrator (a)The arbitrator or panel shall be in charge ofthe arbitration and all related proceedings,and shall have the full authority of a hearing officer as described in AS 36.30.670(b). (b)The arbitrator or panel shall conduct the arbitration fairly,impartially,and informally,with a view to expediting resolution of the dispute. (c)The arbitrator's or panel's rulings on all preliminary and procedural matters,including venue, scheduling,discovery,and evidentiary matters,are final and binding on the parties. Exhibit R-7 Page 66 of 80 (d)The arbitrator or panel may not participate in settlement discussions between the parties or ina mediation with the parties. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.980.Evidence (a)The formal rules of evidence do not apply to arbitrations under AS 36.30.627 and 2 AAC 12.950 -2 AAC 12.989,with the exception of legal privileges recognized by the law of this state,including the attorney-client privilege and the spousal privilege. (b)The arbitrator shall determine the admissibility,relevance,and materiality of evidence.Evidence of any type may be admitted if a reasonable person would rely upon it in the conduct of serious affairs, and if admission of the evidence would further the arbitrator's understanding of the matter. (c)The arbitrator shall determine the admissibility,relevance,and materiality of evidence offered.The arbitrator may refuse to admit or may disregard evidence that the arbitrator considers cumulative, unreliable,or unnecessary.The arbitrator may limit or reject presentation of evidence that the arbitrator considers of slight value compared to the time and effort involved in presentation. (d)The arbitrator may order the exclusion of any witness other than a party or the party's representative. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.982.Burden of proof The party presenting the claim or counterclaim has the burden of proving the claim or counterclaim by a preponderance of the evidence. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 Exhibit R-7 Page 67 of 80 2 AAC 12.984.Record and transcript (a)The arbitration shall be tape-recorded.A party requesting copies of the tapes shall pay the costs of duplication and make any necessary arrangements to duplicate the tapes. (b)A party desiring a transcript shall make arrangements directly with a court reporter.The requesting party shall pay the costs of the court reporter and the transcript,if prepared. (c)If atranscript is prepared,a copy shall be provided to the arbitrator at no cost.A copy shall be provided to the other party upon payment of its pro rata share of the court reporter and transcript costs incurred by the requesting party. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.870 2 AAC 12.986.Form of decision (a)The arbitrator's decision must be written.The original shall be filed with the commissioner and served on the parties within the time limits set out in AS 36.30.695(b). (b)In the decision,the arbitrator shall state the relief granted and shall provide sufficient detail to make the basis of the arbitrator's resolution of the claim clear.Findings of fact and conclusions of law are not required if the arbitrator considers them unnecessary to an understanding of the arbitrator's reasoning. (c)In the decision,the arbitrator shall identify the prevailing party in the claim or state that there is no prevailing party. (d)In the decision,the arbitrator shall state whether the expenses of the arbitrator,including the arbitrator's fees,any required travel,and any other expenses of the arbitrator,shall be borne equally by the parties or assessed in whole or part against a specified party. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.631 AS 36.30.695 AS 36.30.870 2 AAC 12.987.Attorneys fees and costs (a)The prevailing party may file a motion for attorney's fees and costs with the arbitrator in accordance with Alaska Rules of Civil Procedure 68,79,and 82.For purposes of Alaska Rule of Civil Procedure 68(b), the arbitrator shall consider one ofthe following dates to be the equivalent of the date on which parties in a civil action have made disclosures required by Alaska Rule of Civil Procedure 26: Exhibit R-7 Page 68 of 80 (1)the date set under 2 AAC 12.970 -2 AAC 12.972 as a deadline for mutual initial disclosure,if any; (2)if a deadline for mutual initial disclosure has not been set,a date that the arbitrator sets with consideration to the specific discovery methods applied to a particular arbitration. (b}The opposing party may file an opposition to the motion for attorney's fees and costs with the arbitrator in accordance with Alaska Rules of Civil Procedure 68,79,and 82. (c)The arbitrator may not allow reply memoranda in support of a motion for attorney's fees and costs. (d)The arbitrator shall rule promptly on the motion for attorney's fees and costs.In the ruling,the arbitrator shall state the amount of the award granted,if any,and shall provide sufficient detail to make the basis of the arbitrator's resolution of the motion clear.Findings of fact and conclusions of law are not required if the arbitrator considers them unnecessary to an understanding of the arbitrator's reasoning. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.631 AS 36.30.870 2 AAC 12.988.Rules of procedure In the event of conflict between a provisions of AS 09.43.010 -09.43.180 (Uniform Arbitration Act)and a provision of AS 36.30,the provision of AS 36.30 shall be given precedence in arbitrations conducted under 2 AAC 12.950 -2 AAC 12.989. History History:Eff.5/26/2004,Register 170 Annotations Authority:AS 36.30.040 AS 36.30.690 AS 36.30.870 2 AAC 12.989.Definitions for construction arbitration procedures In 2 AAC 12.950 -2 AAC 12.989,unless the context requires otherwise, (1)"business day"means a day other than Saturday,Sunday,or a state holiday; (2)"commissioner"means the commissioner of transportation and public facilities. History History:Eff.5/26/2004,Register 170 Exhibit R-7 Page 69 of 80 Annotations Authority:AS 36.30.040 AS 36.30.870 Article 18 General Provisions Section 990.Definitions. 2 AAC 12.990.Definitions (a)In this chapter (1)"business license”means a license required under the Alaska Business License Act (AS 43.70)and,for a person engaging in a business subject to licensing provisions of a regulatory nature,a license, certificate,permit,registration,or similar evidence of authority issued for an occupation by competent legal authority; (2)"chief procurement officer"means the officer appointed under AS 36.30.010 as the chief procurement officer; (3)"concession contract"means a contract (A)in which the primary method of compensation is based on commissions paid to the contractor; (B)the commissions are generated from the collection of receipts,or fees for services,charged to customers other than the state;and (C)generally,the commissions are based on a percentage of gross sales or an established fee schedule and do not involve the expenditure of state funds; (4)"cost analysis"means the evaluation of cost data for the purpose of arriving at costs actually incurred or estimates of costs to be incurred,prices to be paid,and costs to be reimbursed; (5)"cost data"means information concerning the actual or estimated cost of labor,material,overhead, and other cost elements that have been actually incurred or that are expected to be incurred by the contractor in performing the contract; (6)"employment agreement"means an agreement or contract between an employer and an employee in which the terms and conditions of employment are set out,and includes a contract with a citizen of a foreign country for services to be performed primarily in the foreign country,if the contract provides for such matters as state control of the work performed,the hours of work,the benefits that will be provided to a person who performs work under the contract,and the state's right to discharge a person who performs work under the contract; (7)"interested party"means an actual or prospective bidder or offeror whose economic interest might be affected substantially and directly by the issuance of a contract solicitation,the award of a contract, or the failure to award a contract; (8)"minor informalities"means matters of form rather than substance which are evident from the bid document,or are insignificant matters that have a negligible effect on price,quantity,quality,delivery, or contractual conditions and can be waived or corrected without prejudice to other bidders; Exhibit R-7 Page 70 of 80 (9)"nonresponsive"means a bid or proposal that does not conform in all material respects to the solicitation; (10)"price analysis"means the evaluation of price data,without analysis of the separate cost components and profit as in cost analysis,which may assist in arriving at prices to be paid and costs to be reimbursed; (11)"price data"means factual information concerning offered or proposed selling prices,historical selling prices,and current selling prices,including profit,for supplies,services,or construction substantially similar to those being procured; (12)"responsive bidder"means a firm or person who has submitted a bid that conforms in all material respects to the solicitation; (13)"solicitation"means an invitation to bid,a request for proposals,a request for quotations,or any other method of soliciting bids,proposals,or quotes to perform a state contract; (14)"accredited youth education and employment program"means a program that allows participants to earn academic credits that are recognized by a school district in this state; (15)"alternate dispute resolution"means an informal technique that is voluntarily used to resolve issues in controversy;"alternate dispute resolution"includes negotiation,mediation,facilitation,and arbitration; (16)"practicable"has the meaning given in (b)ofthis section; (17)"reasonable and adequate procedures"means procedures that ensure fairness to potential offerors and competition commensurate with the circumstances of the procurement,considering price,mission requirements,and available competition;"reasonable and adequate procedures"includes contacting only one potential offeror in appropriate circumstances; (18)"Alaska Online Public Notice System"means the system developed under AS 44.62.175; (19)"division of vocational rehabilitation"means the division of vocational rehabilitation in the Department of Labor and Workforce Development. (b)In AS 36.30, (1)"medical doctor"means (A)a person who is licensed to practice medicine in the state under AS 08.64; (B)a person who is authorized to practice in the state as an advanced nurse practitioner because of specialized education and experience and who is certified to perform acts of medical diagnosis and to prescribe medical,therapeutic,or corrective measures under regulations adopted by the Board of Nursing (12 AAC 44.400);or (C)a physician assistant as defined in 12 AAC 40.990; (2)"other governments"includes a (A)federally recognized tribe;and (B)foreign government;for purposes of this paragraph,"federally recognized tribe”means a Native entity within the State of Alaska that is on the list published by the United States Bureau of Indian Affairs,Department ofthe Interior,in 67 Federal Register,46331 -46333 (July 12,2002); (3)"place of business"means that location at which normal business activities are conducted,services are rendered,or goods are made,stored,or processed;a post office box,mail drop,telephone,or answering service does not,by itself,constitute a "place of business"; (4)"protestor"means an actual or prospective bidder,offeror,or contractor who is aggrieved in connection with the solicitation or the award of a contract and who files a protest; Exhibit R-7 Page 71 of 80 (5)"practicable"means what may reasonably be accomplished or applied; (6)"practical"has the meaning given "practicable"in this subsection; (7)"staffed"means that the bidder or at least one employee of the bidder is a resident of this state under AS 16.05.415(a). ({c}In the definition of "procurement officer"set out in AS 36.30.990,"authorized"means authorized by a written delegation under 2 AAC 12.740 by the head of an agency that has a delegation of procurement authority based on a written determination of capability under AS 36.30.015. (d)Repealed 2/28/2014. (e)Repealed 2/28/2014. (f)In the definition of "external procurement activity”set out in AS 36.30.790,an agency of a foreign government is an external procurement activity. History History:Eff.1/1/88,Register 104;am 3/30/90,Register 113;am 3/27/93,Register 125;am 4/25/97, Register 142;am 11/28/97,Register 144;am 10/3/2002,Register 163;am 1/15/2011,Register 197;am 2/28/2014,Register 209 Annotations Authority:AS 36.30.040 Editor's note:With Register 180,January 2007 and under the authority of AS 44.62.125,the regulations attorney changed obsolete terminology concerning the division of occupational licensing and the division of banking and securities in conformity with ch.14,SLA 2005 and to reflect the transfer of certain corporations functions within the Department of Commerce,Community,and Economic Development. As of Register 202 (July 2012),the regulations attorney made a technical revision under AS 44.62.125(b)(6),to 2 AAC 12.990(c). Chapter 15 Purchasing Section 10.(Repealed). 20.(Repealed). 30.(Repealed). 40.(Repealed). 50.(Repealed). 60.(Repealed). 70.(Repealed). 80.(Repealed). 90.(Repealed). 100.(Repealed). 110.(Repealed). Exhibit R-7 Page 72 of 80 115.Payment for state purchases of goods or services. 120.(Repealed). 130.Electronic disbursements. 2 AAC 15.010.Competitive bids Repealed 9/26/76. 2 AAC 15.020.Sealed bids Repealed 1/1/88. 2 AAC 15.030.Bid list Repealed 1/1/88. 2 AAC 15.040.Rejection of bids Repealed 1/1/88. 2 AAC 15.050.Late bids Repealed 1/1/88. 2 AAC 15.060.Awards Repealed 1/1/88. 2 AAC 15.070.Tie bids Repealed 1/1/88. 2 AAC 15.080.Alaska bidder preference Repealed 9/26/76. 2 AAC 15.090.Bid award Repealed 1/1/88. 2 AAC 15.100.Aggrieved bidder Repealed 1/1/88. 2 AAC 15.110.Records Repealed 9/26/76. 2 AAC 15.115.Payment for state purchases of goods or services (a)If payment for goods or services purchased by a state agency is not made on or before a required payment date as specified in AS 37.05.285(a),the state agency shall pay interest on the unpaid balance in accordance with AS 37.05.285(c). Exhibit R-7 Page 73 of 80 (b)If a seller of goods or services believes that interest is owed on a payment made by a state agency, the seller shall,within 30 days after receipt of the payment,submit to the billing address of the state agency a written request for payment of interest.A request for payment of interest must include {1)the contract or purchase order number; (2)the date of delivery of goods or services; (3)the state warrant number and the date the warrant was received; (4)a certified copy of the invoice submitted for payment;and (5)a calculation of the amount of interest due. (c)The state official responsible for authorizing payment for goods or services for which an interest payment has been requested under (b)ofthis section shall review and act upon the request no later than 10 days after receipt of the request.If a request for interest payment is disallowed,the seller may appeal the disallowance in accordance with 2 AAC 25. (d)Under AS 37.05.285(f)(2)and this section,a payment is considered made on the date when the payment is personally delivered to the seller or agent of the seller or on the date the payment is postmarked upon mailing. (e)In this section and in AS 37.05.285, (1)"contract"means all state agency contracts and contract awards other than those covered by AS 36.90.010; (2)"purchase"refers to goods or services provided to a state agency;it does not refer to goods or services provided to an individual under a state agency program that requires a determination of the individual's eligibility to receive the goods or services before payment is made by the state agency; (3)"purchase order”means a document authorizing a seller to deliver goods or services with payment to be made later and includes an advertising order,delivery order,field purchase order,or state transportation request; (4)"seller of goods or services"means an individual or organization that offers or transfers property or services to a state agency under a contract of a sale or purchase order. (f)In AS 37.05.285,"proper billing"means an original invoice or certified copy of an original invoice that includes (1)the contract number,purchasing document reference number,an itemized description of the goods or services provided,prices for each item or increment of service,extended prices; (2)the seller of goods or services'valid taxpayer identification number,if the goods or services provided are of a type that is required to be included on a United States tax information return as described in 26 U.S.C.6041,6041A,6042(a),6044,6045,6049(a),6050A,or 6GOSON (Internal Revenue Code);and (3)any other documentation required by the contract or purchase order. (g)In accordance with AS 37.05.285(a)(2),a claim provided to a state agency for goods or services received shall not be certified for payment until receipt of a proper billing. History History:Eff.2/25/87,Register 101;am 4/1/88,Register 105 Annotations Authority:AS 37.05.020 Exhibit R-7 Page 74 of 80 AS 37.05.285 2 AAC 15.120.Definitions Repealed 1/1/88. Annotations Editor's note:Regulations in this chapter were voluntarily filed without formal promulgation on 12/14/72.Amended or restated regulations since that date have been adopted under the Administrative Procedure Act on the dates indicated in each section. 2 AAC 15.130.Electronic disbursements (a)Astate agency shall make a disbursement to a payee by electronic methods in accordance with AS 37.25.050(a),unless the (1)state agency has determined that another disbursement method is required or permissible under AS 37.25.050(b)(1),(3),(5),or (6);or (2)payee declines when offered the option of electronic disbursement methods authorized under AS 37.25.050(b)(2),(4),or (5). (b)A determination under (a)(1)of this section allowing a disbursement method to a payee other than electronic must be documented in writing by the state agency and retained in accordance with the state agency's retention schedules for financial documents. (c)Astate agency shall offer electronic disbursement methods to each of its payees unless the state agency has determined,in writing,that another disbursement method is required or permissible under AS 37.25.050(b). (d)Astate agency shall send an offer of electronic disbursement methods at least once to the address on record for each payee of the state agency,and shall specify in that offer a date on or before which the payee may respond. (e)The department will send an offer of electronic disbursement methods at least once to the address on record for each payee on the central vendor master file and to each state employee,and will specify in that offer a date on or before which the payee or employee may respond. (f)A state agency is responsible for sending an offer of electronic disbursement methods to a payee who receives disbursements from the state agency and who is not on the central vendor master file,and shall specify in that offer a date on or before which the payee may respond. (g)If a payee notifies the offering state agency that it rejects the offer of electronic disbursement methods,another method of payment must be used. (h)!f a payee is sent an offer of electronic disbursement methods,and the payee does not respond on or before the date specified for a response,the state agency shall,and the department will,consider the lack of response to be an election for another disbursement method. (i)A payee may opt for electronic disbursement methods at any time for disbursements that state agencies make electronically,even after a rejection by the payee under (g)or (h)of this section of an offer of electronic disbursement methods. Exhibit R-7 Page 75 of 80 (j})Documentation of offers of electronic disbursement methods and payee responses must be retained by the offering state agency and department in accordance with applicable retention schedules for financial documents. (k)in this section, (1)"central vendor master file"means the list of payees maintained within the statewide accounting system in the department; (2)"department"means the Department of Administration; (3)"payee"means an entity or individual receiving a disbursement from a state agency;"payee" includes vendors,employees,grantees,recipients,beneficiaries,and clients. History History:Eff.2/15/2006,Register 177 Annotations Authority:AS 37.05.020 AS 37.25.050 Chapter 25 Claims Section 10.Presentation of claims required. 20.Review of disallowance by appropriate administrative or executive officer. 30.Appeal of disallowance by department of administration. 40.Assignment to hearing officer. 50.Procedure following assignment. 60.Hearing procedure. 70.Questions of law. 80.Decision following hearing. 2 AAC 25.010.Presentation of claims required (a)No claim for reimbursement for money expended,or for compensation for labor,materials,or supplies furnished,or services given to or for the state,may be processed under this chapter unless it first was promptly presented to the appropriate administrative or executive officer for approval and payment. (b)For purposes of fiting claims under this chapter,unless otherwise specified by law,"promptly"in (a) of this section means within six months after the money was expended,the labor,materials,or supplies were furnished,or the services were given to or for the state.However,this time limitation may be waived for good cause shown. (c)The scope of the claim may properly include Exhibit R-7 Page 76 of 80 (1)reimbursement for money expended or compensation for labor,materials,or supplies furnished or services given to or for the state; (2)awards for damages,lost profits,and lost interest;and (3)any other expenses incurred as a result of the contractual relationships between the claimant and the state. (d)The scope ofthe claim may not include attorney fees. (e)No claim against any department in the executive branch which has adopted a mandatory claim and appeal procedure will be heard under this chapter. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.010(a) AS 44.77.020(d) AS 44.77.050 2 AAC 25.020.Review of disallowance by appropriate administrative or executive officer (a)If the appropriate administrative or executive officer disallows all or part of the claim,the claimant may obtain a review of the officer's action by applying within 60 calendar days after receipt of the disallowance to the Department of Administration,P.O.Box C,Juneau,Alaska 99811,either orally or in writing. (b)If the application for a review is made orally,the department will,in its discretion,request that the claimant file a written application identifying the claim and the decision disallowing it if the department reasonably believes a written application is necessary to enable the department to identify the claim and to obtain the necessary papers and memoranda to proceed with the review.The request for review must clearly state the position of the claimant with respect to the claim. (c)In all other respects,the procedures for a review under this section will be the same as the procedures for an appeal under this chapter. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.020 2 AAC 25.030.Appeal of disallowance by department of administration (a)If a claim is disallowed by the Department of Administration,the claimant,the appropriate administrative or executive officer who approved the voucher for payment,or both,may appeal to the department from its original decision to disallow the claim by giving a written notice of appeal to the Department of Administration,P.O.Box C,Juneau,Alaska 99811,within 60 days after the claimant or officer receives a written notice of disallowance. Exhibit R-7 Page 77 of 80 (b)A written notice of appeal under this section need not be in any particular form.However,it must show a desire to have the department review its original decision to disallow,must sufficiently identify the claim to permit the department to make the requested review,and must be signed by the claimant, his agent,or the officer who approved the voucher.The notice of appeal must clearly state the position of the claimant with respect to the claim. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 2 AAC 25.040.Assignment to hearing officer Upon receipt of a notice of appeal under this chapter,the department will assign the matter to a hearing officer. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 2 AAC 25.050.Procedure following assignment (a)Upon receipt of the assignment of a matter under this chapter,the hearing officer shall have all pertinent papers and memoranda relating to the claim and to the decision to disallow,as designated by any party to the appeal,transmitted to him.The hearing officer,in his discretion,may request that additional papers and memoranda be transmitted to him.The claimant has the right to view any of the aforementioned material. (b)Upon receipt of the relevant papers and memoranda,the hearing officer shall set a time and place for hearing the appeal.A hearing should be scheduled under this subsection as soon as practical,but not later than 60 calendar days after the hearing officer receives the relevant papers and memoranda. (c)When a hearing has been scheduled under this section,the hearing officer shall inform the claimant, the officer disallowing payment,the officer approving the voucher and any other interested person,at least 15 calendar days before the hearing,of the place and time set for the hearing.He also shall inform them that they will be given a reasonable opportunity to present their arguments relating to the claim at the hearing. (d)Either party to the claim may seek to have the hearing date rescheduled.If,in the hearing officer's discretion,the request for rescheduling appears adequately justified the hearing will be rescheduled. Failure of the claimant to appear at the hearing may be grounds for disallowance of the claim. (e)Both parties to the claim shall submit a hearing memorandum to the Department of Administration before the hearing date.The hearing memorandum should contain factual background,citations of law Exhibit R-7 Page 78 of 80 where appropriate,a statement of position,and the remedy sought.The Department of Administration will forward copies of the hearing memorandum to the adverse parties before the hearing. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 AS 44.77.050 2 AAC 25.060.Hearing procedure (a)At the hearing,the hearing officer shall hear the arguments ofthe claimant,the officer disallowing the payment,the officer approving the voucher,and any other interested party. (b)The hearing officer may hear witnesses on a question of fact involved.These witnesses must be placed under oath before testifying.Both parties to the hearing may present witnesses.The hearing officer may request the testimony of additional witnesses. (c)The hearing officer may authorize the deposition of an absent witness to be taken. (d)Witnesses testifying at the hearing and testifying at a deposition must be informed that false testimony is perjury. (e)Proceedings at the hearing must be electronically recorded.A transcript will be prepared if requested by a party to the action.The party requesting the transcript will be billed the cost of transcribing the recording. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 AS 44.77.050 2 AAC 25.070.Questions of law if a question of law is involved in a claim presented under this chapter,the hearing officer will request a written opinion from the Department of Law. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 AS 44.77.060 2 AAC 25.080.Decision following hearing Exhibit R-7 Page 79 of 80 {a)After hearing the arguments ofthe parties and any witnesses,and obtaining a written opinion from the Department of Law (if necessary),the hearing officer may affirm,reverse,or modify the original decision disallowing the claim.The hearing officer's decision must be stated in writing,and must include the basis for the decision.Information obtained by the hearing officer subsequent to the hearing may be considered in making a decision if the parties are given an opportunity to comment on it. (b)In cases of decisions against the state,the hearing officer's written decision must include a statement that the Department of Administration will issue a warrant against the proper appropriation for the sum the hearing officer finds due against the claimant,if any.In all cases the decision must include a statement that if the claimant does not accept the hearing officer's decision he may bring an action under AS 09.50.250 -09.50.300 and Appellate Rule 45,but only if he brings it within 30 calendar days after receiving notice of the hearing officer's decision.No warrant will be issued until the claimant notifies the Department of Administration in writing that the award is accepted and the claim is satisfied,or until the state agency which was a party to the claim or the Department of Law notifies the Department of Administration that no action was brought on the claimant's claim within 30 days as provided by law. (c)The hearing officer's decision is the final administrative action available to claimants and is not appealable to the Department of Administration. History History:Eff.12/2/78,Register 68 Annotations Authority:AS 44.77.040 Exhibit R-7 Page 80 of 80 Exhibit R-8 Chapter 96 Public Information Article 1.Applicability and Purpose.(2 AAC 96.100 -2 AAC 96.110) 2.Disclosure Requirements.(2 AAC 96.200 -2 AAC 96.240) 3.Requests for Public Records.(2 AAC 96.300 -2 AAC 96.370) 4.Requests for Electronic Services and Products.(2 AAC 96.400 -2 AAC 96.470) 5.General Provisions.(2 AAC 96.900) Annotations Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b}(6),the regulations attorney relocated former 6 AAC 96 to 2 AAC 96,and made conforming technical changes,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history notes for provisions relocated to 2 AAC 96 carry forward the history from former 6 AAC 96. Before Register 132,January 1995,regulations regarding access to public information appeared at 6 AAC 95. Article 1 Applicability and Purpose Section 100.Applicability. 110.Purpose. 2 AAC 96.100.Applicability (a)This chapter applies to (1)requests made to a public agency for the disclosure of public records; (2)the format used and the fees charged by a public agency in providing or disclosing public records; and (3)the electronic services and products,including software copyrights,that a public agency may provide to access public records. (b)Records that are readily available for public inspection are not subject to the procedures of this chapter.In this subsection,"readily available"means available during state business hours in an agency's office or in a public library.Records that are readily available for public inspection include records in unrestricted state archives,state recorder offices;records pertaining to a public agency's regularly conducted and regularly recorded activities,including its adjudicatory proceedings;library books;books still in print;statutes;case law reporters;magazines;journals;published regulations;state land plats;natural resource case files;motor vehicle records;and treatises.If records that are defined as readily available under this subsection are withheld or access is denied,then the records are no longer considered to be readily available for public inspection. Exhibit R-8 Page 1 of 28 (c)Notwithstanding this chapter,a public agency may adopt its own procedures for administrative appeals of a public agency's denial,in whole or part,of a public records request. (d)This chapter does not prescribe substantive standards for determining if information and records are disclosable or nondisclosable. (e)The provisions of this chapter apply to records of the Alaska Industrial Development and Export Authority to the extent that they are consistent with the procedures contained in the booklet entitled Procedures for Inspection of Records,revised as of July 2012,prepared by the Alaska Industrial Development and Export Authority and adopted by reference in this subsection. History History:Eff.11/6/94,Register 132;am 6/22/2000,Register 154;am 12/28/2014,Register 212 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.100 to 2 AAC 96.100,and made conforming technical changes to 2 AAC 96.100(e),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.100 carries forward the history from former 6 AAC 96.100. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. The Alaska Industrial Development and Export Authority's Procedures for Inspection of Records, adopted by reference in 2 AAC 96.100(e),is available on the authority's website,at the following Internet address:http://www.aidea.org/About/PoliciesProcedures.aspx 2 AAC 96.110.Purpose The purpose of this chapter is to ensure that requests for disclosure of public records and for electronic services and products are handled in a timely,reasonable,and responsive manner,without infringing on the established legal rights of a person. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 Exhibit R-8 Page 2 of 28 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.110 to 2 AAC 96.110,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.110 carries forward the history from former 6 AAC 96.110. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. Article 2 Disclosure Requirements Section 200.Public information principles. 210.Access to records;rights;requirements;format. 220.Requester's justification or need for records. 230.Nondiscrimination. 240.Reasonable fees required. 2 AAC 96.200.Public information principles (a)It is the policy of the executive branch of government to disclose public records and to provide copies of those records in an expeditious manner.Disclosing public records and making copies of them upon payment of the required fees,if any,is a public agency obligation. (b)It is the policy of the executive branch of government to limit the collection of personal information only to that data necessary for the efficient administration of a public agency. (c)To ensure that public information is widely available to the public,public agencies are to comply with AS 40,25.115(e)regarding submission of information to the Alaska State Library about (1)public information that a public agency collects,compiles,or publishes,including information regarding databases used by the agency to maintain public records;and (2)information about the electronic services and products routinely provided to the public,the public agency shall provide information to the Alaska State Library when electronic services and products are made available to the public and when electronic services or products of that public agency are substantially modified. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 Exhibit R-8 Page 3 of 28 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.200 to 2 AAC 96.200,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.200 carries forward the history from former 6 AAC 96.200. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.210.Access to records;rights;requirements;format (a)Subject to the provisions of AS 40.25.110 -40.25.220,a public record maintained by a public agency is available for inspection and copying in the format in which that agency maintains or disseminates the record.A public agency shall duplicate and provide copies of a public record upon request and upon payment of the applicable fee as described by this chapter. (b)A public agency is not required to compile or summarize its public records in response to a request for public records. (c)A public agency is not required to manipulate its data to create new records in response to a request for public records.A public agency may manipulate its data to create electronic services and products if (1)the public agency can do so without impairing its functioning; (2)the data is protected from intentional or accidental modification or destruction;and (3)the requester pays for the cost of developing the requested electronic service or product,based on fees established by the public agency under 2 AAC 96.460. (d)When providing public records or electronic services or products,a public agency shall ensure that access to confidential information and proprietary software is protected.Except as provided by law,if the request is for a public record that contains confidential information,the public agency shall delete or mask the nondisclosable confidential information and provide the requested public records upon payment of the applicable fee as described in 2 AAC 96.360. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.210 to 2 AAC 96.210,and made conforming technical changes to 2 Exhibit R-8 Page 4 of 28 AAC 96.210(c)(3)and (d),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.210 carries forward the history from former 6 AAC 96.210. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.210. 2 AAC 96.220.Requester's justification or need for records All disclosable public records must be made available upon request and upon compliance with the requirements of AS 40.25.110 -AS 40.25.125 and this chapter.A public agency may not request a justification or explanation of need or intended use,but a public agency may inquire whether the person making the request is a party,or represents a party,involved in litigation with the state or a public agency to which the requested record is relevant.If so,the requester shall be informed to make the request in accordance with applicable court rules. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.122 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.220 to 2 AAC 96.220,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.220 carries forward the history from former 6 AAC 96.220. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical revisions to 2 AAC 96.220. 2 AAC 96.230.Nondiscrimination When providing public records or electronic services and products,a public agency may not discriminate among requestors or classes of requestors,such as academic researchers,state and federal agencies, members of the public,news organizations,genealogists,or nonprofit groups. Exhibit R-8 Page 5 of 28 History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.230 to 2 AAC 96.230,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.230 carries forward the history from former 6 AAC 96.230. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b}(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.240.Reasonable fees required (a)A public agency may establish a fee schedule for duplicating public records,and shall establish a fee schedule for providing electronic services and products.Fees shall be consistent with AS 40.25.110,AS 40.25.115,and this chapter. (b)The fees developed by a public agency to provide electronic services and products may not be set at a level necessary to recover all development and operational costs of the public agency's information system,unless the system exists solely for responding to requests for public records. (c)Fees may not be assessed as a condition of inspecting public records if the public agency receiving the request does not incur costs to search for the requested public record. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.240 to 2 AAC 96.240,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.240 carries forward the history from former 6 AAC 96.240. Exhibit R-8 Page 6 of 28 As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. Article 3 Requests for Public Records Section 300.Records prepared for routine distribution. 305.Place to file. 310.Form of request. 315.Description of records sought. 320.Initial action upon receipt of a request. 325.Response to request;time limits. 330.Deletion of nondisclosable information. 335.Denial of request. 340.Appeal from denial;manner of making. 345.Appeal determinations;time allowed;by whom made. 350.Contents of determination denying appeal. 355.Records in electronic form. 360.Copies and fees. 370.Public interest fee waiver or reduction for public records. 2 AAC 96.300.Records prepared for routine distribution A request for production of materials prepared by a public agency for routine public distribution, including pamphlets,published maps,copies of speeches,press releases,educational materials,blank forms and applications,must be honored and the information supplied in reasonable quantities as determined by the public agency.The public agency may set a reasonable limit on the number of copies of materials that the public agency provides in response to a request under this section.The public agency may take into account its existing stock of the materials in determining that limit.No determination under 2 AAC 96.325 -2 AAC 96.335 is necessary in these cases,since preparation of the records for routine public distribution itself constitutes a determination that the records are disclosable. Copies must be furnished with reasonable promptness in response to the request. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Exhibit R-8 Page 7 of 28 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.300 to 2 AAC 96.300,and made conforming technical changes to 2 AAC 96.300,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.300 carries forward the history from former 6 AAC 96,300. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.305.Place to file A request for a public agency record may be filed at the nearest office of that public agency. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:The addresses of principal agency offices are listed in the Directory of State Officials, compiled by the Legislative Affairs Agency semiannually.A copy of that document may be requested from the Legislative Affairs Agency,State Capitol,Juneau,AK 99801-1182,telephone:(907)465-4648; and is available on the Alaska Legislature's website at http://w3.legis.state.ak.us/pubs/pubs.php.The Directory of State Computer Applications and Telecommunications Facilities,compiled by the Division of Information Services,Department of Administration,P.O.Box 110206,Juneau,AK 99811-0206,also includes agency contact information and a description of state databases. As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.305 to 2 AAC 96.305,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.305 carries forward the history from former 6 AAC 96.305. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6)to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.310.Form of request (a)Except as otherwise provided by this chapter,a request to a public agency for a public record must be in writing.Request forms may be provided by a public agency,but a request may not be denied solely because it is not on that form.If a request includes a stamped,addressed postcard,the public agency shall promptly use it to acknowledge the date of receipt of the request. Exhibit R-8 Page 8 of 28 (b)An oral request for records is considered a valid request under this chapter.Upon receipt of an oral request,a public agency shall inform the requester of the provisions of this section.If the request involves a variety of records,a public agency may require that the request be submitted in writing. (c)An oral request is deemed denied if not granted within five working days after the office of the public agency responsible for maintaining the requested records receives the request,excluding the request day and including the following five working days.The decision to grant or deny an oral request is within the sole discretion of the public agency.A requester's only remedyif the oral request is denied is to make a written request in accordance with (a)of this section. (d)If a requester making an oral request for public records is unable to write a request due to a physical or mental disability,the public agency shall either assist the requester in preparing a written request or treat the oral request as a written request. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.310 to 2 AAC 96.310,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.310 carries forward the history from former 6 AAC 96.310. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.310. 2 AAC 96.315.Description of records sought (a)A requester must describe the public records sought in sufficient detail to enable the public agency to which the request is made to locate the records.The public agency shall make reasonable efforts to assist in the identification and description of records sought,and to assist the requester in formulating the request.If the records are described in general terms,the agency shall attempt to communicate with the requester in order to identify the public records requested,speed the response,and lessen the administrative burden of processing an overly broad request.These attempts may not be used as a means to discourage requests. (b)If a public agency determines that the description of the records sought by the request is not sufficient to allow the public agency to identify the requested records,that agency shall,no later than 10 working days after receipt of the request,notify the requester that the request cannot be processed Exhibit R-8 Page 9 of 28 until additional information is furnished.Time limits set out in this chapter do not begin to run until a sufficient description of the records is received in the office of the public agency responsible for maintaining the records. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6)},the regulations attorney relocated former 6 AAC 96.315 to 2 AAC 96.315,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.315 carries forward the history from former 6 AAC 96.315. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.315. 2 AAC 96.320.Initial action upon receipt of a request (a)Except for requests governed by 2 AAC 96.300,a public agency shall maintain a log of each written request for public records that it receives.The log must include the date the request was received by the public agency,the name of the requester,a notation on whether notice of receipt was sent to the requester under 2 AAC 96.310,and the date that additional information,if required,was requested under 2 AAC 96.315.If the request is received by the office of the public agency that does not maintain the requested records,the receiving office shall promptly forward the request to the office responsible for maintaining those records. (b)The log of requests for public records is a public record.It must be preserved,included as a separate item on the public agency's record retention schedules,and provided upon request in accordance with this chapter. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Exhibit R-8 Page 10 of 28 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.320 to 2 AAC 96.320,and made conforming technical changes to 2 AAC 96.320,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.320 carries forward the history from former 6 AAC 96.320. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b}(6),the regulations attorney made technical corrections to 2 AAC 96.320. 2 AAC 96.325.Response to request;time limits (a)Except as otherwise provided in this section,as soon as practicable,but not later than the 10th working day after the date the agency receives a request for public records that complies with this chapter,the public agency shall (1)furnish all requested records that are disclosable;and (2)advise the requester which of the requested records are nondisclosable,if any,and the specific legal authority and specific facts supporting nondisclosure. (b)If the public agency decides that a public record is,in fact,a request for electronic services and products,the public agency shall advise the requester of its decision within 10 working days after receipt of a request and the reasons for this decision. (c)Any time that elapses between the time a requester is sent notice that processing the request will generate chargeable fees and the time the requester makes suitable arrangement for payment of those fees under 2 AAC 96.355 and 2 AAC 96.360 is excluded from the 10-working-day period of (a)of this section,or any extension ofthat period. (d)A public agency may extend the basic 10-working-day period established under (a)of this section for a period not to exceed 10 additional working days by providing notice to the requester within the basic 10-working-day period.The notice must state the reasons for the extension and the date by which the office expects to be able to furnish the requested records or to issue a determination that the records are not disclosable.The notice must include a statement that the extension is not invoked for purposes of delay.The basic 10-day period may be extended only when one or more of the following circumstances exist,and then only as to those specific documents within the request as to which the circumstances apply: (1)there is a need to search for and collect the requested records from field or other offices that are separate from the office responsible for maintaining the records; (2)there is a need to search for,collect,and examine a voluminous amount of separate and distinct records sought in a single request; (3)there is a need for consultation with an officer or employee who is absent on approved leave or official business; (4)the basic response period comes during a peak workload period;or Exhibit R-8 Page 11 of 28 (5S)there is a need to consult with legal counsel to ensure that protected interests of private or government persons or entities are not infringed. (e)If a search or copying task will,within the 10-day period and any authorized extension under (d)of this section,substantially impair the other functions of the public agency or an office responsible for maintaining the requested records,the agency head may request an additional extension from the attorney general.Upon receipt of a request for an additional extension,the attorney general shall promptly give the requester and the agency an opportunity to be heard.The attorney general shall tender a speedy decision.The attorney general may grant an extension only to the public agency in extraordinary circumstances and only for the minimum period determined by the attorney general to be required to complete the search or copying of the public records without substantial impairment of the other public agency functions. (f)A public agency shall give a written response granting or denying a written request for public records within the prescribed time limit.If a response is not received by a requester by the expiration of the time limit,the requester may consider the request denied. (g)The time limits set out in this section do not apply if the requester agrees in writing that the requested records need not be supplied until a specified date.!f the requester does not agree in writing to an extension of time beyond that date,an extension beyond the specified date is governed by (d)and (e)of this section. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.325 to 2 AAC 96.325,and made conforming technical changes to 2 AAC 96.325(c),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.325 carries forward the history from former 6 AAC 96.325. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.325. 2 AAC 96.330.Deletion of nondisclosable information (a)Ifa record contains both disclosable and nondisclosable information,the nondisclosable information must be segregated and withheld and the disclosable information must be disclosed.If the disclosable Exhibit R-8 Page 12 of 28 portions of a record cannot reasonably be segregated from the nondisclosable portions in a manner that allows information meaningful to the requester to be disclosed,the public agency may not disclose the record. (b)If an electronic file or database contains both nondisclosable and disclosable records,a public agency must (1)delete or mask the nondisclosable information before releasing the requested record;or (2)write a program to extract the requested disclosable public records from the electronic file or data base. (c)Masking or deleting nondisclosable information does not constitute providing an electronic service or product.Except as provided by 2 AAC 96.355 or other law,a fee charged shall be consistent with 2 AAC 96.360. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.1115 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.330 to 2 AAC 96.330,and made conforming technica!changes to 2 AAC 96.330(c),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.330 carries forward the history from former 6 AAC 96.330. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.330. 2 AAC 96.335.Denial of request (a)A request for a public record that complies with this chapter may be denied only if (1)the record is not known to exist after the public agency makes a diligent search for it; (2)the record is not in the public agency's possession,and after a diligent search the public agency does not know where the record is to be found; (3)the record has been destroyed in accordance with an applicable record-retention schedule; (4)nondisclosure of the record is authorized by a federal law or regulation,or by state law;or (5)the record is believed to be in the agency's possession but has not yet been located,in which case the public agency shall proceed under (f)of this section. Exhibit R-8 Page 13 of 28 (b)A request may be denied by the public agency head or by an agency employee to whom denial authority has been delegated by the public agency head. (c)An initial denial of a written request must be in writing;must state the reasons for the denial, including any specific legal grounds for the denial;and must be dated and signed by the person issuing the denial.If a request is denied by a public agency employee to whom denial authority has been delegated,the notice of denial must reflect this delegation.A copy of 2 AAC 96.335 -2 AAC 96.350 must be enclosed with the denial. (d)A denial of a written request,in whole or in part,must state that (1)the requester may administratively appeal the denial by complying with the procedures in 2 AAC 96.340; (2)the requester may obtain immediate judicial review of the denial by seeking an injunction from the superior court under AS 40.25.125; (3)an election not to pursue injunctive remedies in superior court shall have no adverse effects on the rights of the requester before the public agency;and (4)an administrative appeal from a denial of a request for public records requires no appeal bond. (e)A denial of a written request is considered to be issued at the time the denial is either detivered to the United States Postal Service for mailing,or hand-delivered to the requester by an employee or agent of the public agency. (f)If a written request is denied because a record has not yet been located and the record is believed to exist in the agency's possession,the office in the public agency responsible for maintaining the record is believed to exist in the agency's possession,the office in the public agency responsible for maintaining the record shall continue to search until the record is located or until it appears that the record does not exist or is not in the public agency's possession.The public agency shall periodically inform the requester of its progress in searching for the requested record. (g)Arecord that is the subject of a public records request that has been denied shall not be destroyed or transferred from the public agency's custody,except that records may be transferred to state archives and records management services as provided by AS 40.21 and regulations adopted under AS 40.21.A public agency may not destroy or transfer custody of a record to which access has been denied or restricted until at least 60 working days after the requester is notified in writing that the request has been denied,or if there is an administrative or judicial appeal or other lega!action pending at the end of the 60-working-day period,until the requester has exhausted those actions. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 AS 40.25.125 Exhibit R-8 Page 14 of 28 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.335 to 2 AAC 96.335,and made conforming technical changes to 2 AAC 96.335(c)and (d)(1),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.335 carries forward the history from former 6 AAC 96.335. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.335. 2 AAC 96.340.Appeal from denial;manner of making (a)A requester whose written request for a public record has been denied,in whole or in part,may ask for reconsideration of the denial by submitting a written appeal to the agency head. (b)An appeal under (a)of this section must be mailed or hand-delivered to the agency head within 60 working days after the denial is issued and must include the date of the denial and the name and address of the person issuing the denial.The appeal must also identify the records to which access was denied and which are the subject of the appeal.If an appeal is from the failure of the agency to respond to the records request within the appropriate time limit under 2 AAC 96.325,the appeal must so state, must identify the records sought,and must identify the public agency to which the request was directed and the date of the request. (c})The 60 working days within which an appeal must be filed begins to run upon the issuance of the denial or,if no denial is issued,upon the expiration of the time period within which the public agency should have responded. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 AS 40.25.125 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.340 to 2 AAC 96.340,and made a conforming technical change to 2 AAC 96.340(b),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.340 carries forward the history from former 6 AAC 96.340. Exhibit R-8 Page 15 of 28 As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.340. 2 AAC 96.345.Appeal determinations;time allowed;by whom made (a)As soon as practicable,but not later than the 10th working day after the close of the record on appeal,the agency head shall issue a written determination stating which of the records that are the subject of the appeal will be disclosed and which records will not be disclosed.The written determination must comply with 2 AAC 96.350. (b)The agency head may extend the 10-working-day period for a period not to exceed 30 working days upon written request from the requester,or by sending a written notice to the requester within the basic 10-working-day period. (c)The agency head may delegate authority and duties under (a)and (b)of this section to a full-time employee of the public agency not involved in the denial and not subordinate to the employee responsible for the denial.The employee delegated this authority may not subdelegate to another employee. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 AS 40,25.124 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.345 to 2 AAC 96.345,and made a conforming technical change to 2 AAC 96.345(a),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.345 carries forward the history from former 6 AAC 96.345. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.345. Exhibit R-8 Page 16 of 28 2 AAC 96.350.Contents of determination denying appeal A determination under 2 AAC 96.345 responding to an appeal must be in writing,must specify the specific statute,regulation,or court decision that is the basis for the denial,and must state briefly the reason for the denial.A denial under this section is the final agency decision.A denial must further state that,as provided by AS 40.25.124,the requester may obtain judicial review of the denial by appealing the denial to the superior court. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 AS 40.25.124 AS 40.25.125 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.350 to 2 AAC 96.350,and made a conforming technical change to 2 AAC 96.350,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.350 carries forward the history from former 6 AAC 96.350. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.350. 2 AAC 96.355.Records in electronic form (a)Except as otherwise provided by law,public records maintained in electronic form are subject to disclosure and copying.Upon receipt of a request complying with this chapter,a public agency shall provide a copy of a public record in the form in which it is maintained or disseminated by the public agency.A public agency may not release proprietary software except as provided in 2 AAC 96.440. (b)A copy of an electronic public record is generated by copying the electronic file that was used to produce the printed form of the public record.Except as provided in (c)and (d)of this section,a public agency shall establish the fee to duplicate an electronic public record in accordance with 2 AAC 96.360. (c)A copy of an electronic public record in a geographic information system is generated by copying the plot file,the associated geographic and tabular files,or other files required to generate the printed form of the public record.A public agency shall establish the fee to duplicate an electronic public record ina geographic information system in accordance with 2 AAC 96.460. Exhibit R-8 Page 17 of 28 (d)The Department of Public Safety will establish the fee for a copy of an electronic public record ina vehicle registration list in accordance with 2 AAC 96.460. (e)A public agency entering into a contract with a private,public,or nonprofit entity to provide electronic copies of public records is not relieved from complying with AS 40.25.110 and this chapter. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.355 to 2 AAC 96.355,and made conforming technical changes to 2 AAC 96.355,to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.355 carries forward the history from former 6 AAC 96.355. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.360.Copies and fees (a)A public agency shall prescribe in writing the standard unit charge for copies of public records. (b)The fee to search for and duplicate a public record may reflect (1)actual costs for copying the record in the requested format,including costs for paper,tapes, microfiche,disks or other media; (2)costs incurred by the agency to duplicate the record,including computer processing time;and (3)salary and benefits costs for the employees performing the work,including computer programming work required to extract or copy the records,as set out in AS 40.25.110. (c)Except in the case of news organizations,fees must be paid before the records are disclosed.A public agency may require payment in advance of a search for a public record if the agency reasonably believes that the search will generate a fee under AS 40.25.110.If the request is from a news organization or an employee or agent of a news organization and the agency head reasonably believes that the requested record search will require more than five hours to complete,the public agency head may require payment in advance of the search by the news organization only when (1)the request is unreasonable or in bad faith; (2)the news organization has failed to pay for previous requests;or (3)the request requires extraordinary expenditure of state resources. Exhibit R-8 Page 18 of 28 (d)A public agency may waive the requirement under (c)of this section for payment in advance if the requester and the public agency agree in writing to mutually acceptable time frames for payment. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.360 to 2 AAC 96.360,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.360 carries forward the history from former 6 AAC 96.360. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.360 2 AAC 96.370.Public interest fee waiver or reduction for public records (a)For purposes of a public interest fee waiver or reduction under AS 40.25.110(d),and notwithstanding 2 AAC 96.220 and 2 AAC 96.230,a waiver or reduction shall be granted if the requester certifies and the agency finds that the requester has established that (1)the records are likely to contribute significantly to the public's understanding of the operations or activities of the state government; (2)the records are not sought primarily for a purpose that is commercial or financial; (3)the records are not sought by or on behalf of a person involved in litigation,including any judicial or administrative proceeding,arbitration,or mediation,with a public agency in which the records are relevant; (4)the combined amount of all fee waivers and reductions granted to the requester and to any other requesters acting in concert with the requester in making requests for the same or related records does not exceed $500 during any period of 12 consecutive months;and (5)the requested fee waiver or reduction does not cause the requester to exceed the amount allowed under (b)of this section. (b)A requester may not receive fee waivers or reductions under this section if the combined fee waivers and reductions granted by all public agencies to the requester under this section and 2 AAC 96.470 total more than $500 during any period of 12 consecutive months. Exhibit R-8 Page 19 of 28 History History:Eff.1/19/2013,Register 205 Annotations Authority:AS 40.25.110 AS 40.25.120 AS 40.25.123 Article 4 Requests for Electronic Services and Products Section 400.Agency responsibilities. 410.Form of request. 420.Response to request;agreement for electronic services and products. 430.Denial of a request. 440.Software copyrights. 450.Public terminals;on-line access. 460.Fees for electronic services and products;fee review. 470.Public purpose fee waiver or reduction for electronic services and products. 2 AAC 96.400.Agency responsibilities (a)A public agency providing electronic services and products shall adopt procedures for handling requests,including fee schedules and procedures for negotiating any written agreements that may be required. (b)A public agency may contract with a private,public,or nonprofit entity to provide electronic services and products.A contract under this subsection must provide that the state retains ownership of public records,and that the public agency must ensure compliance with AS 40.25.110 -AS 40.25.220,this chapter,and the state's records management program. (c)A public agency shall identify databases that undergo periodic or continuous updates. (d)A public agency shall notify the requester of electronic services and products that any agreement for those services or products must contain a release of liability that the public agency is not liable for any harm or injury that a requester may suffer as a consequence of any inaccurate information the requester may obtain through the electronic service or product. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 Exhibit R-8 Page 20 of 28 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.400 to 2 AAC 96.400,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.400 carries forward the history from former 6 AAC 96.400. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125({b)(6),the regulations attorney made technical corrections to 2 AAC 96.400. 2 AAC 96.410.Form of request (a)Except as provided in (b)and (d)of this section,a request to a public agency for electronic services and products must be in writing.A request form may be provided by a public agency,but a request may not be denied solely because it is not on that form.If a request includes a stamped,addressed postcard, the public agency shall promptly use it to acknowledge the date the request was received. (b)An ora!request for electronic services and products is considered a valid request under this chapter. If the request involves a variety of electronic services and products,a public agency may require that the request be submitted in writing. (c)An oral request is deemed denied if not granted within 10 working days after the office of the public agency responsible for providing the requested electronic services and products receives the request, excluding the request day and including the following 10 working days.The decision to grant or deny a request under (b)of this section is within the sole discretion of the public agency.Upon receipt of an oral request,a public agency shall inform the requester of the provisions of this section. (d)If a requester making an oral request for electronic services and products is unable to write a request due to a physical or mental disability,the public agency shall assist the requester in preparing a written request,or treat the oral request as a written request. (e)A requester must describe the electronic services and products sought with enough specificity to allow the public agency to ascertain the electronic services and products that are requested. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)}(6),the regulations attorney relocated former 6 AAC 96.410 to 2 AAC 96.410,to reflect Executive Order 113 (2005). Exhibit R-8 Page 21 of 28 Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.410 carries forward the history from former 6 AAC 96.410. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.410. 2 AAC 96.420.Response to request;agreement for electronic services and products (a)A public agency may require a written agreement,signed by the requester and an authorized officer of the public agency,before beginning work required to provide electronic services and products.The agreement shall include (1)estimated fees and payment arrangements; (2)provisions to protect the security and integrity of the information system;and (3)a release of liability for the public agency providing the electronic services and products. (b)Except for the release of liability under (a)(3)of this section,an agreement under this section may not contain restrictions on third-party use of the information,including restrictions on sale,distribution, or reformatting of the information. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.115 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.420 to 2 AAC 96.420,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.420 carries forward the history from former 6 AAC 96.420. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.420. 2 AAC 96.430.Denial of a request When a request for electronic services or products is denied because the public agency cannot reasonably provide the requested work,the public agency shall provide a response to the requester explaining that the requested service or product cannot be provided.To the extent possible,the Exhibit R-8 Page 22 of 28 response must further inform the requester of how to obtain the public records that would have been used to satisfy the request for electronic services and products. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.430 to 2 AAC 96.430,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.430 carries forward the history from former 6 AAC 96.430. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.430. 2 AAC 96.440.Software copyrights (a)A public agency may adopt procedures governing the duplication and distribution of copyrighted software owned by the state,in order to protect that agency's rights under AS 44.99.400.These procedures may not conflict with AS 40.25.110 -AS 40.25.220 and this chapter. (b)Nothing in this section shall be interpreted to limit or impair the rights or protection granted toa public agency under federal copyright law as a result of its ownership of the copyright to the state (c)A public agency may charge a reasonable fee for software copyrighted under this section.Fees shall be established in accordance with 2 AAC 96.460. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Exhibit R-8 Page 23 of 28 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.440 to 2 AAC 96.440,and made a conforming technical change to 2 AAC 96.440(c),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.440 carries forward the history from former 6 AAC 96.440. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)}(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.450.Public terminals;on-line access Before providing on-line access to an electronic file or database,a public agency shall ensure that (1)access instructions or assistance are provided to persons using public terminals; (2)access to nondisclosable information is prohibited;and (3)protection is provided against intentional or accidental disclosure,modification,or destruction of records. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.450 to 2 AAC 96.450,to reflect Executive Order 113 (2005). Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.450 carries forward the history from former 6 AAC 96.450. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. 2 AAC 96.460.Fees for electronic services and products;fee review (a)A public agency shall prescribe,in writing,in advance of processing a request for electronic services and products,all fees for providing those services and products,and shall provide an estimate of fees to the requester. (b)A public agency shall adopt a fee schedule for electronic services and products in accordance with AS 40.25.115 and this chapter. (c)A public agency that has not adopted a fee schedule for electronic services and products may charge no more than the rates established by the Department of Administration and published in the "Guide to Exhibit R-8 Page 24 of 28 Data Center &Telecommunications Services",October,1994.A public agency may use those rates until that public agency adopts a fee schedule. (d)A public agency shall set out,in writing,the assumptions used to calculate rates and document the agency's costs and the rate formulas.A public agency shall monitor the use and costs of the data processing services used to support the building and operation of the agency's information system,and then shall bill requesters no more than their proportional use of the information system.A public agency may use federal guidelines,such as Federal Information Processing Standard 96 or a similar standard,to develop,adopt,and implement a charging system.Suggested guidelines for establishing a public agency fee schedule for electronic services and products include (1)forecasting the estimated volume of usage for each electronic service and product produced by the public agency;these usage forecasts should generally be in terms of the number of service units, including processing unit seconds,records printed,data stored,and programmer analyst hours of each data processing service to be used for a given rate period; (2)forecasting the costs of all the various resources,including hardware,software,personnel,and development and maintenance costs of the information system used to provide the electronic service or product; (3)distributing the resource costs to each ofthe services according to the resources required to support the service or product;and (4)determining rates by dividing the total cost of each service or product by the total estimated volume of usage. (e)A public agency's fees may include the following charges associated with providing the electronic service or product: (1)processing costs,including any chargeback fees paid to another state,federal,or municipal agency or service bureau; (2)salary and benefits costs for each employee responding to and providing the electronic services and products; (3)currently published postal and freight charges; (4)costs for tapes,mailing label paper,computer paper,microfiche,disks,and other media used to provide the records;and (5)costs for providing a public terminal for on-line access to electronic information as described by 2 AAC 96.450. (f)A public agency may waive the requirement for advance payment for electronic services or products upon receipt of a written agreement from the requester that establishes time frames for payment that are mutually acceptable. (g)A requester for electronic services and products may request a review,consistent with AS 40.25.115(g),of a public agency's fees for those services and products.Upon request from the Office of the Governor,a public agency providing those services and products must provide the assumptions and documentation of the costs and the rate formulas used to calculate its fees for electronic services and products.In a review under this subsection, (1)a written determination and finding will be made whether the fees comply with AS 40.25.115 and this chapter;and Exhibit R-8 Page 25 of 28 (2)a decision will be provided to the requester and the public agency within 60 working days,explaining the determination under this subsection;that decision may include instructions to the public agency regarding fees. (h}A fee reduction or an instruction provided under (g)of this section to a public agency is effective immediately,unless a later deadline is imposed or regulations are required to implement those reductions or instructions. History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 Editor's note:The "Guide to Data Center &Telecommunications Services"and Federal Information Processing Standard 96 referred to in 2 AAC 96.460 may be reviewed by contacting Enterprise Technology Services,Department of Administration,P.O.Box 110206,Juneau,AK 99811-0206. As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.460 to 2 AAC 96.460,and made conforming technical changes to 2 AAC 96.460(e)(5),(g),and (h),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.460 carries forward the history from former 6 AAC 96.460. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. As of Register 204 (January 2013),and under AS 44.62.125(b)(6),the regulations attorney made technical corrections to 2 AAC 96.460. 2 AAC 96.470.Public purpose fee waiver or reduction for electronic services and products (a)For purposes of a public purpose fee waiver or reduction under AS 40.25.115(b),and notwithstanding 2 AAC 96.220 and 2 AAC 96.230,a waiver or reduction shall be granted if the requester certifies and the agency finds that the requester has established that (1)the electronic services and products are likely to contribute significantly to the public's understanding of the operations or activities of the state government; (2)the electronic services and products are not sought primarily for a purpose that is commercial or financial; (3)the electronic services and products are not sought by or on behalf of a person involved in litigation, including any judicial or administrative proceeding,arbitration,or mediation,with a public agency in which the electronic services and products are relevant; Exhibit R-8 Page 26 of 28 (4)the combined amount of all fee waivers and reductions granted to the requester and to any other requesters acting in concert with the requester in making requests for the same or related electronic services and products does not exceed $500 during any period of 12 consecutive months;and (5)the requested fee waiver or reduction does not cause the requester to exceed the amount allowed under (b)of this section. (b)A requester may not receive fee waivers or reductions under this section if the combined fee waivers and reductions granted by all public agencies to the requester under this section and 2 AAC 96.370 total more than $500 during any period of 12 consecutive months. History History:Eff.1/19/2013,Register 205 Annotations Authority:AS 40.25.115 AS 40.25.123 Article 5 General Provisions Section 900.Definitions. 2 AAC 96.900.Definitions Unless the context indicates otherwise,in this chapter (1)"agency head"means the principal executive officer of a public agency; (2)deleted; (3)"database"means information that is created or compiled by a public agency or its agent to support the public agency's primary business or responsibility and that contains a set of interrelated data or data files in a computerized form organized so the data can be expanded,updated,and retrieved rapidly; (4)"electronic format"means information that is not stored in paper format,including electronic information stored or provided in computer-based,optical,magnetic,or microfiche forms; (5)"geographic information system"or "GIS"means an integrated system linking spatial and tabular data that is a system of computer hardware,software,and procedures supporting the capture, management,manipulation,analysis,and display of spatially referenced data; (6)"hard copy"means a copy of a record in printed format; (7)"public agency"has the same meaning as in AS 40.25.220,but is limited to public agencies in the executive branch of the state not excluded by AS 40.25.123; (8)"public terminal"means an input or output device,established and operated by a public agency for the use and benefit of the public and provides access to electronic public records; (9)"standard unit charge"means the predetermined cost incurred by a public agency to produce a unit of product or to perform a particular operation under normal operating conditions; (10)"working day"means every day except Saturday,Sunday,or a legal state holiday. Exhibit R-8 Page 27 of 28 History History:Eff.11/6/94,Register 132 Annotations Authority:AS 40.25.110 AS 40.25.115 AS 40.25.120 AS 40.25.123 AS 40.25.220 Editor's note:As of Register 176 (January 2006),and acting under AS 44.62.125(b)(6),the regulations attorney relocated former 6 AAC 96.900 to 2 AAC 96.900,and deleted the definition of "council"in 2 AAC 96.900(2),to reflect Executive Order 113 (2005).Executive Order 113 eliminated the Telecommunications Information Council and transferred its functions to the governor and to the Department of Administration.The history note for 2 AAC 96.900 carries forward the history from former 6 AAC 96.900. As of Register 158 (July 2001),the regulations attorney made technical revisions under AS 44.62.125(b)(6),to reflect the 2000 renumbering of former AS 09.25.100 -09.25.220 by the revisor of statutes.The provisions of former AS 09.25.100 -09.25.220 were relocated to AS 40.25.100 -40.25.220. Exhibit R-8 Page 28 of 28 Exhibit R-9 Power Cost Equalization --RCA Regulations coordinating with AEA Actions 3 AAC 52.640.Adjustments to power cost equalization (a)Aregulated participating electric utility shall request a change in its power cost equalization per kilowatt-hour in conjunction with a request for (1)approval of tariff filing under 3 AAC 52.501 -3 AAC 52.519;or (2)a permanent or interim rate change that establishes higher or lower nonfuel costs for the utility. (b)A nonregulated participating electric utility shall request a change in its power cost equalization per kilowatt-hour if the utility has (1)experienced a change in its fuel or purchased power costs;or (2)changed its rates. (c)The commission will,in its discretion,adjust the power cost equalization per kilowatt-hour of a participating electric utility based on (1)a review by the commission or by the Alaska Energy Authority of monthly data submitted by the utility to the Alaska Energy Authority; (2)a review ofthe annual filing submitted by the utility; (3)any other evidence that the power cost equalization per kilowatt-hour of the utility is not just and reasonable;or (4)a determination by the Alaska Energy Authority that appropriations are insufficient to finance full payments to eligible electric utilities,in which case the power cost equalization per kilowatt-hour of each participating utility will be reduced by an equal percentage. History:Eff.10/28/89,Register 112;am 5/18/96,Register 138;am 9/11/2004,Register 171;am 4/28/2005,Register 174 Annotations Authority:AS 42.05.141 AS 42.05.151 AS 42.45.110 AS 42.45.130 AS 42.45.160 AS 42.45.170 Editor's note:As of Register 151 (October 1999),the functions of the former Department of Community and Regional Affairs were transferred to other state agencies.In accordance with ch.58,SLA 1999 and AS 44.62.125(b)(6),the regulations attorney revised 3 AAC 52.640(c)(1),as of Register 161 (April 2002), to reflect changes in the names of state agencies. Exhibit R-9 Page lof4 3 AAC 52.670.Other requirements A participating electric utility shall (1)install and maintain adequate meters to measure kilowatt-hours of generation,fuel consumption, and energy consumption by all ratepayers as prescribed by 3 AAC 107.200; (2)make reasonable efforts to minimize administrative,operating,and overhead costs,including use of the best available technology consistent with sound utility management practices; (3)cooperate with appropriate state agencies to implement cost-effective energy conservation measures and to plan for and implement feasible alternatives to diesel generation;and (4)file a monthly report with the Alaska Energy Authority in accordance with the requirements of AS 42.45.110(h)(1)and 42.45.170(a)(2). History:Eff.10/28/89,Register 112;am 5/18/96,Register 138;am 9/11/2004,Register 171 Annotations Authority:AS 42.05.141 AS 42.05.151 AS 42.45.110 AS 42.45.130 AS 42.45.160 AS 42.45.170 3 AAC 52.680.Effect on power cost equalization for noncompliance (a)If a participating electric utility fails to comply with any of the requirements of AS 42.45.100 - 42.45.190 or 3 AAC 52.600 -3 AAC 52.670,the power cost equalization (PCE)of that utility becomes interim and refundable effective as of the initial date of the noncompliance. (b)If a nonregulated participating electric utility fails to notify the commission at least 30 days before a change in its rates,the PCE becomes interim and refundable effective on the same day the utility implements the rate change (c)If a participating electric utility fails to file its annual report when due,the PCE becomes interim and refundable on the date the annual report was due,and the commission may recommend that further PCE disbursements to the utility be suspended until the annual report is filed and the commission establishes permanent PCE rates. (d)The PCE rate designated as interim and refundable under this section is subject to modification when a permanent PCE rate is approved by order of the commission.The modification will be made as follows: (1)if the permanent PCE rate is less than the interim and refundable PCE rate,the effective date for the permanent PCE rate is the date that the interim and refundable PCE rate was established by the Exhibit R-9 Page 2of 4 commission;the difference between the two rates will be recovered by the Alaska Energy Authority under the provisions of 3 AAC 107.210(d); (2)if the permanent PCE rate is greater than the interim and refundable PCE rate,the effective date for the permanent PCE rate is the date that the permanent PCE rate is established by the commission;the lower interim and refundable PCE rate will be made permanent for the period from the date that the interim and refundable PCE rate was established to the date that the higher permanent PCE rate is effective. (e)If a participating electric utility fails to file its periodic fuel or purchased power cost report when due, the PCE becomes interim and refundable on the date the report was due,and the commission may recommend that further PCE disbursements to the utility be suspended until the utility files its periodic fuel or purchased power cost report and the commission establishes permanent PCE rates. History:Eff.10/28/89,Register 112;am 5/18/96,Register 138;am 9/11/2004,Register 171 Annotations Authority:AS 42.05.141 AS 42.05.151 AS 42.45.110 AS 42.45.130 AS 42.45.160 AS 42.45.170 Editor's note:As of Register 151 (October 1999),the regulations attorney under AS 44.62.125(b)(6) made technical conforming amendments to 3 AAC 52.680(d)(1)to implement ch.58,SLA 1999. 3 AAC 52.690.Definitions Unless the context indicates otherwise,in 3 AAC 52.600 -3 AAC 52.690 (1)"commission"means the Regulatory Commission ofAlaska; (2)"community facility"means a facility determined by the Alaska Energy Authority to be a community facility as defined in AS 42.45.150(1)and 3 AAC 107.270(b); (3)"fuel surcharge"means a fuel cost rate adjustment,a cost-of-power adjustment,or any similar mechanism; (4)"kilowatt-hour sold"means all electric energy delivered by a utility to consumers and includes energy furnished by the utility to a consumer free of charge; (5)"nonregulated participating electric utility"means a utility that is exempt from the provisions of AS 42.05,except for the provisions of AS 42.05.221 -42.05.281,or from all the provisions of AS 42.05; (6)"participating electric utility"means an eligible electric utility as defined in AS 42.45.150(2)that receives payments from the power cost equalization fund; (7)"regulated participating electric utility"means a utility as defined in AS 42.05.990(4)(A)that is subject to the provisions of AS 42.05; (8)"substantial inventory capacity"means fuel storage capacity exceeding 10 percent of annual usage; Exhibit R-9 Page 3of 4 (9)"PCE"means power cost equalization. History:Eff.10/28/89,Register 112;am 5/18/96,Register 138;am 4/24/2004,Register 170;am 9/11/2004,Register 171 Annotations Authority:AS 42.05.141 AS 42.05.151 AS 42.05.990 AS 42.45.110 AS 42.45.130 AS 42.45.160 AS 42.45.170 Editor's note:For Alaska Energy Authority regulations regarding the power cost equalization program, see 3 AAC 107.200 -3 AAC 107.270. As of Register 151 (October 1999),the regulations attorney under AS 44.62.125 (b}(6)made technical conforming amendments to 3 AAC 52.690(3)to implement ch.58,SLA 1999. Exhibit R-9 Page 4of 4 Exhibit S-1 Chapter 44.83.ALASKA ENERGY AUTHORITY Article 01.CREATION AND ORGANIZATION Sec.44.83.010.Legislative finding and policy.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.020.Creation of authority. There is created the Alaska Energy Authority.The authority is a public corporation of the state in the Department of Commerce,Community,and Economic Development but with separate and independent legal existence. Sec.44.83.030.Membership of the authority. The directors of the Alaska Energy Authority are the members of the Alaska Industrial Development and Export Authority. Sec.44.83.040.Officers;meetings;quorum. (a)The chair and vice-chair of the Alaska Industrial Development and Export Authority shall serve as officers of the Alaska Energy Authority.The powers of the Alaska Energy Authority are vested in the directors,and four directors of the authority constitute a quorum.Action may be taken and motions and resolutions adopted by the Alaska Energy Authority at a meeting by the affirmative vote of a majority of the directors.The directors of the Alaska Energy Authority serve without compensation,but they shall receive the same travel pay and per diem as provided by law for board members under AS 39.20.180. (b)The board may meet and transact business by an electronic medium if (1)public notice of the time and locations where the meeting will be held by an electronic medium has been given in the same manner as if the meeting were held in a single location; (2)participants and members of the public in attendance can hear and have the same right to participate in the meeting as if the meeting were conducted in person;and (3)copies of pertinent reference materials,statutes,regulations,and audio-visual materials are reasonably available to participants and to the public. (c)A meeting by an electronic medium as provided in this section has the same legal effect as a meeting in person. (d)A director of the authority may not vote on a resolution of the authority relating to a lease or contract to be entered into by the authority under this chapter if the director is a party to the lease or contract or has a direct ownership or equity interest in a firm,partnership,corporation,or association that is a party to the contract or lease.When abstaining from voting,the director must disclose the reason for the abstention.A director who is a member of an electric cooperative that is organized under or subject to AS 10.25 (Electric and Telephone Cooperative Act)may vote on a resolution relating to a contract or lease to which that cooperative is a party.The director shall disclose the cooperative Exhibit S-1 Page 1 of 14 membership at the time of voting.A resolution of the authority that is approved by a majority of the directors present who are not barred from voting under this subsection is a valid action of the authority for all purposes. Sec.44.83.045.Qualifications,powers,and duties of officers and directors.[Repealed,Sec.27 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.050.Staff.[Repealed,Sec.23 ch 156 SLA 1978]. Repealed or Renumbered Article 02.PURPOSE AND POWERS Sec.44.83.070.Purpose of the authority. The purpose of the authority is to promote,develop,and advance the general prosperity and economic welfare of the people of the state by providing a means of financing and operating power projects and facilities that recover and use waste energy and by carrying out the powers and duties assigned to it under AS 42.45. Sec.44.83.080.Powers of the authority. In furtherance of its corporate purposes,the authority has the following powers in addition to its other powers: (1)to sue and be sued; (2)to have a seal and alter it at pleasure; (3)to make and alter bylaws for its organization and internal management; (4)to adopt regulations governing the exercise of its corporate powers; (5)to improve,equip,operate,and maintain power projects and bulk fuel,waste energy,energy conservation,energy efficiency,and alternative energy facilities and equipment; (6)to issue bonds to carry out any of its corporate purposes and powers,including the establishment or increase of reserves to secure or to pay the bonds or interest on them,and the payment of all other costs or expenses of the authority incident to and necessary or convenient to carry out its corporate purposes and powers; (7)to sell,lease as lessor or lessee,exchange,donate,convey,or encumber in any manner by mortgage or by creation of any other security interest,real or personal property owned by it,or in which it has an interest,when,in the judgment of the authority,the action is in furtherance of its corporate purposes; (8)to accept gifts,grants,or loans from,and enter into contracts or other transactions regarding them,with any person; (9)to deposit or invest its funds,subject to agreements with bondholders; (10)to enter into contracts with the United States or any person and,subject to the laws of the United States and subject to concurrence of the legislature,with a foreign country or its agencies,for the construction,financing,operation,and maintenance of all or any part of a power project or bulk Exhibit S-1 Page 2 of 14 fuel,waste energy,energy conservation,energy efficiency,or alternative energy facilities or equipment, either inside or outside the state,and for the sale or transmission of power from a project or any right to the capacity of it or for the security of any bonds of the authority issued or to be issued for the project; (11)to enter into contracts with any person and with the United States and,subject to the laws of the United States and subject to the concurrence of the legislature,with a foreign country or its agencies for the purchase,sale,exchange,transmission,or use of power from a project,or any right to the capacity of it; (12)to apply to the appropriate agencies of the state,the United States,and a foreign country and any other proper agency for the permits,licenses,or approvals as may be necessary,to acquire, construct,maintain,and operate power projects in accordance with the licenses or permits,and to obtain,hold,and use the licenses and permits in the same manner as any other person or operating unit; (13)to enter into contracts or agreements with respect to the exercise of any of its powers,and do all things necessary or convenient to carry out its corporate purposes and exercise the powers granted in this chapter; (14)to recommend to the legislature (A)the pledge of the credit of the state to guarantee repayment of all or any portion of revenue bonds issued to assist in construction of power projects; (B)an appropriation from the general fund (i)for debt service on bonds or other project purposes;or (ii)to reduce the amount of debt financing for the project; (15)to carry out the powers and duties assigned to it under AS 42.45; (16)to make grants or loans to any person and enter into contracts or other transactions regarding the grants or loans; (17)to promote energy conservation,energy efficiency,and alternative energy through training and public education; (18)to acquire a Susitna River power project,whether by construction,purchase,gift,or lease, including the acquisition of property rights and interests by eminent domain under AS 09; (19)to perform feasibility studies and engineering and design with respect to power projects. Sec.44.83.085.Susitna River power project annual report. The authority shall prepare,not later than the first day of each regular session ofthe legislature,an annual report summarizing the status of the Susitna River power project and shall notify the legislature that the report is available. Sec.44.83.090.Power contracts and the Regulatory Commission of Alaska. (a)The authority shall,in addition to the other methods that it may find advantageous,provide a method by which municipal electric,rural electric,cooperative electric,or private electric utilities and regional electric authorities,or other persons authorized by law to engage in the distribution of electricity may secure a reasonable share of the power generated by a project,or any interest in a project,or for any right to the power and shall sell the power or cause the power to be sold at the lowest reasonable prices that cover the full cost of the electricity or services,including capital and Exhibit S-1 Page 3 of 14 operating costs,debt coverage as considered appropriate by the authority,and other charges that may be authorized by this chapter.Except for a contract or lease entered into under former AS 44.83.380 - 44.83.425,a contract or lease for the sale,transmission,and distribution of power generated by a project or any right to the capacity of it shall provide: (1)for payment of all operating and maintenance expenses of a project and costs of renewals, replacements,and improvements of it; (2)for interest on and amortization charges sufficient to retire bonds of the authority issued for the project and reserves for them,plus a debt service coverage factor as may be determined by the authority to be necessary for the marketability of its bonds; (3)for monitoring of the project by the authority or its agents; (4)for full and complete disclosure to the authority of all factors of costs in the transmission and distribution of power,so that rates to any persons may be fixed initially in the contract or lease and may be adjusted from time to time on the basis of true cost data; (5)for periodic revisions of the service and rates to persons on the basis of accurate cost data obtained by the accounting methods and systems approved by the directors and in furtherance and effectuation of the policy declared in this chapter; (6)for the cancellation and termination of a contract or lease upon violation of its terms by any person; (7)for security for performance as the authority may consider practicable and advisable, including provisions assuring the continuance of the distribution and transmission of power generated by a project and the use of its facilities for these purposes;and (8)other terms not inconsistent with the provisions and policy of this chapter as the authority may consider advisable. (b)The authority is not subject to the jurisdiction of the Regulatory Commission of Alaska. Nothing in this chapter grants the authority jurisdiction over the services or rates of a public utility or diminishes or otherwise alters the jurisdiction of the Regulatory Commission of Alaska with respect to a public utility,including any right the commission may have to review and approve or disapprove contracts for the purchase of electricity by a public utility other than wholesale agreements and contracts described in AS 42.05.431{c)(1). Sec.44.83.092.Authority for municipalities and utilities to enter into power sales contracts. The authority and any municipality or public or private entity operating an electric utility,or a municipality or private entity and another municipality or private entity,may enter into a contract providing for or relating to the sale of electric power by the authority to the municipality or entity,or by the municipality or entity to another municipality or entity.The contract may provide (1)that the amounts payable under the contract are operating expenses of the utility and are valid and binding obligations of the municipality or other entity payable from the gross revenues of the utility; (2)for one or more appropriations of the amounts payable under the contract; (3)for the municipality or other entity to assume the obligations of another contracting party in the event of a default by that party; Exhibit S-1 Page 4 of 14 (4)that after completion of a project the municipality or other entity is obligated to make payments notwithstanding a suspension or reduction in the amount of the power supplied by the project;or (5)that payments under the contract are not subject to reduction by offset or otherwise. Article 03.FINANCIAL PROVISIONS Sec.44.83.100.Bonds of the authority. (a)The authority may borrow money and may issue bonds,including but not limited to bonds on which the principal and interest are payable (1)exclusively from the income and receipts or other money derived from the project financed with the proceeds of the bonds;(2)exclusively from the income and receipts or other money derived from designated projects whether or not they are financed in whole or in part with the proceeds of the bonds;(3)from its income and receipts or other assets generally,or a designated part or parts of them;or (4)from one or more revenue-producing contracts including a contract providing for the security of the bonds made by the authority with any person.The authority may issue bonds to pay,fund,or refund the principal of,or interest or redemption premiums on,bonds issued by it,whether or not the bonds or interest to be funded or refunded have become due. (b)Bonds shall be authorized by resolution of the authority,and shall be dated and shall mature as the resolution may provide,except that no bond may mature more than 50 years from the date of its issue.Bonds shall bear interest at the rates,be in the denominations,be in the form,either coupon or registered,carry the registration privileges,be executed in the manner,be payable in the medium of payment,at the places,and be subject to the terms of redemption which the resolution or a subsequent resolution may provide. (c)All bonds,regardless of form or character,shall be negotiable instruments for all the purposes of AS 45.01 -AS 45.08,AS 45.12,AS 45.14,and AS 45.29 (Uniform Commercial Code). (d)All bonds may be sold at public or private sale in the manner,for the price or prices,and at the time or times which the authority may determine. Sec.44.83.105.Bonds for power projects under the energy program for Alaska.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.110.Trust indentures and trust agreements. (a)In the discretion of the authority,an issue of bonds may be secured by a trust indenture or trust agreement between the authority and a corporate trustee (which may be a trust company,bank, or national banking association,with corporate trust powers,located inside or outside the state)or by a secured loan agreement or other instrument or under a resolution giving powers to a corporate trustee by means of which the authority may (1)make and enter into any and all the covenants and agreements with the trustee or the holders of the bonds that the authority may determine to be necessary or desirable,including,without limitation,covenants,provisions,limitations,and agreements as to Exhibit S-1 Page 5 of 14 (A)the application,investment,deposit,use,and disposition of the proceeds of bonds of the authority or of money or other property of the authority or in which it has an interest; (B)the fixing and collection of rentals,charges,fees,or other consideration for,and the other terms to be incorporated in,contracts with respect to a project or to generated power; (C)the assignment by the authority of its rights in contracts with respect to a project or to generated power or in a mortgage or other security interest created with respect to a project or generated power to a trustee for the benefit of bondholders; (D)the terms and conditions upon which additional bonds of the authority may be issued; (E)the vesting in a trustee of rights,powers,duties,funds,or property in trust for the benefit of bondholders,including,without limitation,the right to enforce payment,performance,and all other rights of the authority or of the bondholders,under a lease,power of contract,contract of sale, mortgage,security agreement,or trust agreement with respect to a project by injunction or other proceeding or by taking possession of by agent or otherwise and operating a project and collecting rents or other consideration and applying the same in accordance with the trust agreement; (2)pledge,mortgage,or assign money,leases,agreements,property,or other rights or assets of the authority either presently in hand or to be received in the future,or both;and (3)provide for any other matters of like or different character that in any way affect the security or protection of the bonds. (b)Notwithstanding any other provisions of this chapter,the trust indenture,trust agreement, secured loan agreement,or other instrument or the resolution constituting a contract with bondholders shall contain a covenant by the authority that it will at all times maintain rates,fees,or charges sufficient to pay,and that a contract entered into by the authority for the sale,transmission,or distribution of power shall contain rates,fees,or charges sufficient to pay the costs of operation and maintenance of the project,the principal of and interest on bonds issued under the trust agreement as the same severally become due and payable,to provide for debt service coverage as considered necessary by the authority for the marketing of its bonds and to provide for renewals,replacements, and improvements of the project,and to maintain reserves required by the terms of the trust agreement.This subsection does not require a covenant that varies from a covenant entered into in accordance with the provisions of former AS 44.83.380 -44.83.425. (c)For the purpose of securing any one or more issues of its bonds,the authority may establish one or more special funds,called "capital reserve funds",and shall pay into those capital reserve funds the proceeds of the sale of its bonds and any other money that may be made available to the authority for the purposes ofthose funds from any other source.The funds shall be established only if the authority determines that the establishment would enhance the marketability of the bonds.All money held in a capital reserve fund,except as provided in this section,shall be used as required,solely for (1) the payment of the principal of,and interest on,bonds or of the sinking fund payments with respect to those bonds,(2)the purchase or redemption of bonds,or (3)the payment of a redemption premium required to be paid when those bonds are redeemed before maturity;however,money in a fund may not be withdrawn from it at any time in an amount that would reduce the amount of that fund to less than the capital reserve requirement set out in (2)of this subsection,except for the purpose of making, with respect to those bonds,payment,when due,of principal,interest,redemption premiums,and the sinking fund payments for the payment of which other money of the authority is not available.Income Exhibit S-1 Page 6 of 14 or interest earned by,or increment to,a capital reserve fund,due to the investment of the fund or any other amounts in it,may be transferred by the authority to other funds or accounts of the authority to the extent that the transfer does not reduce the amount of the capital reserve fund below the capital reserve fund requirement. (d)If the authority decides to issue bonds secured by such a capital reserve fund,the bonds may not be issued if the amount in the capital reserve fund is less than such an amount as may be established by resolution of the authority (called the "capital reserve fund requirement"),unless the authority,at the time of issuance of the obligations,deposits in the capital reserve fund from the proceeds of the obligations to be issued or from other sources,an amount which,together with the amount then in the fund,will not be less than the capital reserve fund requirement. (e)In computing the amount of a capital reserve fund for the purpose of this section,securities in which all or a portion of the funds are invested shall be valued by some reasonable method established by the authority by resolution.Valuation on a particular date shall include the amount of any interest earned or accrued to that date. (f)The chairman of the authority shall annually,no later than January 2,make and deliver to the governor and the legislature a certificate stating the sum,if any,required to restore any capital reserve fund to the capital reserve fund requirement.The legislature may appropriate such a sum,and all sums appropriated during the then current fiscal year by the legislature for such restoration shall be deposited by the authority in the proper capital reserve fund.Nothing in this section creates a debt or liability of the state. (g)When the authority has created and established a capital reserve fund,the commissioner of revenue may lend surplus money in the general fund to the authority for deposit in a capital reserve fund in an amount equal to the capital reserve fund requirement.The loans shall be made on such terms and conditions as may be agreed upon by the commissioner of revenue and the authority,including without limitation terms and conditions providing that the loans need not be repaid until the obligations of the authority secured and to be secured by the capital reserve fund are no longer outstanding. (h)If the authority decides to covenant to issue or to issue bonds secured by a capital reserve fund,the bonds may not be issued until 10 days after the authority has mailed notification to the state bond committee and the Legislative Budget and Audit Committee by certified mail of its intention to establish a capital reserve fund to secure the bond issue.The notification shall include the amount of the capital reserve fund to be established,the amount of bonds proposed to be issued,and the total cost of the project for which the bonds are to be issued.The notification shall be accompanied by an estimate by the authority of the need to withdraw money from the capital reserve fund during the term of the bond issue,the amount that it may be necessary to withdraw,and the time at which withdrawals are estimated to be needed.The authority shall annually prepare a revised estimate,considering the same factors,and a statement of all withdrawals that have occurred from the date of issuance of the bonds to the end of the calendar year.The revised estimate and statement shall be submitted to the state bond committee and the Legislative Budget and Audit Committee by January 30 of the succeeding year. Exhibit S-1 Page 7 of 14 Sec.44.83.120.Validity of pledge. It is the intention of the legislature that a pledge made in respect of bonds is considered perfected and is valid and binding from the time the pledge is made;that the money or property so pledged and thereafter received by the authority shall immediately be subject to the lien of the pledge without physical delivery or further act;and that the lien of the pledge shall be valid and binding as against all parties having claims of any kind in tort,contract,or otherwise against the authority irrespective of whether the parties have notice.Neither the resolution,trust agreement,nor any other instrument by which a pledge is created need be recorded or filed under the provisions of AS 45.01 -AS 45.08, AS 45.12,AS 45.14,and AS 45.29 (Uniform Commercial Code)to be perfected or to be valid,binding,or effective against the parties. Sec.44.83.130.Nonliability on bonds. (a)Neither the members of the authority nor a person executing the bonds is liable personally on the bonds or is subject to personal liability or accountability by reason of the issuance of the bonds. (b)The bonds issued by the authority do not constitute an indebtedness or other liability of the State or of a political subdivision of the state,except the authority,but shall be payable solely from the income and receipts or other funds or property of the authority.The authority may not pledge the faith or credit of the state or of a political subdivision of the state,except the authority,to the payment of a bond and the issuance of a bond by the authority does not directly or indirectly or contingently obligate the state or a political subdivision of the state to apply money from,or levy or pledge any form of taxation whatever to the payment of the bond. Sec.44.83.140.Pledge of the state. The state pledges to and agrees with the holders of bonds issued under this chapter and with the federal agency which loans or contributes funds in respect to a project,that the state will not limit or alter the rights and powers vested in the authority by this chapter to fulfill the terms of a contract made by the authority with the holders or federal agency,or in any way impair the rights and remedies of the holders until the bonds,together with the interest on them with interest on unpaid installments of interest,and all costs and expenses in connection with an action or proceeding by or on behalf of the holders,are fully met and discharged.The authority is authorized to include this pledge and agreement of the state, insofar as it refers to holders of bonds of the authority,in a contract with the holders,and insofar as it relates to a federal agency,in a contract with the federal agency. Sec.44.83.150.Tax exemption. All property of the authority is public property devoted to an essential public and governmental function and purpose and is exempt from all taxes of the state or a political subdivision of the state;however,the authority may make payments in place of taxes in amounts equal to the real and personal property taxes that would be assessed on its real and personal property by each political subdivision in which its property is located to the same extent as if that property were private property and the authority were a non-public corporation.All bonds issued under this chapter are issued by a body corporate and public of this state and for an essential public and governmental purpose and the bonds and the interest and Exhibit S-1 Page 8 of 14 income on and from the bonds and all income of the authority are exempt from taxation except for transfer,inheritance,and estate taxes. Sec.44.83.160.Bonds legal investments for fiduciaries. The bonds of the authority are securities in which all public officers and bodies of the state and all municipalities and municipal subdivisions,all insurance companies and associations and other persons carrying on any insurance business,all banks,bankers,trust companies,savings banks,savings associations,including savings and loan associations and building and loan associations,investment companies and other persons carrying on a banking business,all administrators,guardians,executors, trustees and other fiduciaries,and all other persons whatsoever who are now or may hereafter be authorized to invest in bonds or other obligations of the state,may properly and legally invest funds including capital in their control or belonging to them.Notwithstanding any other provisions of law,the bonds of the authority are also securities that may be deposited with and may be received by all public officers and bodies of this state and all municipalities and municipal subdivisions for any purpose for which the deposit of bonds or other obligations of the state is now or may hereafter be authorized. Sec.44.83.162.-44.83.165.Power cost equalization.[Repealed,Sec.28 ch 18 SLA 1993.For present law,see AS 42.45.100 -42.45.190]. Repealed or Renumbered Sec.44.83.170.Power project fund.(Repealed,Sec.28 ch 18 SLA 1993.For present law,see AS 42.45.010]. Repealed or Renumbered Sec.44.83.177.-44.83.185.Reconnaissance and feasibility studies.(Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.186.Final cost estimate and reauthorization by the legislature.[Repealed,Sec.27 ch 89 SLA 1983]. Repealed or Renumbered Sec.44.83.187.-44.83.189.Applicability of sections;project construction.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.190.-44.83.240.[Renumbered as AS 44.83.900 -44.83.995]. Repealed or Renumbered Sec.44.83.300.-44.83.360.Susitna River hydroelectric project.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Exhibit S-1 Page 9 of 14 Sec.44.83.361.,44.83.363.Rural electrification revolving loan fund.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.370.Electrical service extension fund established.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Article 04.POWER PROJECTS Sec.44.83.380.Program established.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.382.Power development fund established. (a)A power development fund is established in the Alaska Energy Authority to carry out the purposes of former AS 44.83.380 -44.83.425. (b)The fund includes money appropriated to it by the legislature. Sec.44.83.384.Use of fund balance. (a)The fund may be used by the authority to provide money for (1)the defeasance of bonds,or the payment of debt service on loans for or on an issue of bonds sold in connection with a power project constructed or acquired before August 11,1993; (2)the cost of operating and maintaining power projects constructed or acquired before August 11,1993;and (3)debt service on power projects constructed or acquired before August 11,1993. (b)[Repealed Sec.28 ch 18 SLA 1993]. (c)[Repealed,Sec.28 ch 18 SLA 1993]. Sec.44.83.386.Investment of fund. The authority shall invest the money in the fund in the manner provided in AS 37.10.070,37.10.071,and 37.10.075.The authority may withdraw money from the fund only after costs have been incurred or amounts in the fund have been otherwise obligated under contracts for the acquisition and construction of a project. Sec.44.83.388.Allotment to projects. (a)The authority shall maintain records of power project allocations from the fund for each power project (1)approved in accordance with former AS 44.83.185;and (2)for which an allocation is made from an appropriation made by the legislature without specifying an appropriation to a project. (b)Income earned from investment of money appropriated to the fund shall be deposited in the general fund and may be appropriated to the fund by the legislature. Exhibit S-1 Page 10 of 14 Sec.44.83.390.,44.83.392.Reappropriation of fund balance;lapse of excess appropriations.[Repealed, Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.394.Revenue requirements.[Repealed,Sec.27 ch 89 SLA 1983]. Repealed or Renumbered Sec.44.83.396.Operation of power project. (a)A power project that was acquired or constructed under AS 44.83.080(18)or as part of the former energy program for Alaska is owned,and shall be administered,by the authority. (b)When a power project has been acquired or constructed by the authority,the project may be operated for the authority under a contract or lease entered into by a qualified utility and the authority. (c)The authority shall enter into a contract or lease under reasonable terms and conditions to permit the applicant utility to operate the power project when the applicant utility is the only wholesale power customer to be served directly by the power project unless the authority determines a utility making application for a contract or lease to operate a power project is not a qualified utility or is not capable of operating that power project efficiently and in a manner that is consistent with national standards for the industry and with agreements with bondholders. (d)The authority shall adopt regulations to determine the manner of selecting a qualified utility to operate a power project under a contract or lease when there is more than one wholesale power customer to be served directly by the power project. (e)When the authority permits a power project to be operated by a qualified utility under a contract or lease,the authority shall (1)review and approve the annual budget for the operation and maintenance of the power project;and (2)assure that the project is being operated efficiently and in a manner that is consistent with national standards for the industry and agreements with bondholders. Sec.44.83.398.Sale of power from power project.[Repealed,Sec.13 ch 60 SLA 2000]. Repealed or Renumbered Sec.44.83.400.Energy conservation.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.410.Appropriation for Railbelt energy development.(Repealed,Sec.317 ch 171 SLA 1984]. Repealed or Renumbered Sec.44.83.420.Continuing appropriation for Bradley Lake hydroelectric project.[Repealed,Sec.318 ch 171 SLA 1984). Repealed or Renumbered Exhibit S-1 Page 11 of 14 Sec.44.83.425.Definitions. In AS 44.83.382 -44.83.425, (1)"debt service"means the amounts covenanted with respect to,or pledged to pay,bonds under a trust agreement securing bonds; (2)"fund"means the power development fund established by AS 44.83.382; (3)"qualified utility"means an electric utility or an electric operating entity established as an instrumentality of two or more electric utilities certified under AS 42.05 to serve all or part of a market area that is served or will be served by the power project,that the authority determines is capable of operating and maintaining the power project. Article 05.POWER DEVELOPMENT REVOLVING LOAN FUND Sec.44.83.500.Creation of fund.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.510.Powers and duties of authority in administering the fund. (a)Repayment of a loan from the former power development revolving loan fund must be made with the proceeds from the sale of power from projects in the former energy program for Alaska. (b)[Repealed,Sec.28 ch 18 SLA 1993]. Sec.44.83.520.Loan terms.[Repealed,Sec.28 ch 18 SLA 1993]. Repealed or Renumbered Sec.44.83.525.Rate reopeners.[Repealed,Sec.13 ch 60 SLA 2000]. Repealed or Renumbered Sec.44.83.530.Definitions. In AS 44.83.500 -44.83.530, (1)"fund"means the former power development revolving loan fund;and (2)"power project”means a project acquired or constructed under the former energy program for Alaska,AS 44.83.380 -44.83.425. Sec.44.83.600.-44.83.650.Bulk fuel revolving loan fund.[Repealed,Sec.28 ch 18 SLA 1993.For present law,see AS 42.45.250 -42.45.299]. Repealed or Renumbered Article 06.MISCELLANEOUS AND GENERAL PROVISIONS Sec.44.83.900.Annual audit. The authority shall have its financial records audited annually by a certified public accountant.The legislative auditor may prescribe the form and content of the financial records of the authority and shall have access to these records at any time. Exhibit S-1 Page 12 of 14 Sec.44.83.910.Limitations on issuance of bonds by the authority. The authority may not issue bonds except after 60 days notification of its intent to issue bonds is given to the governor and to the legislature,if the legislature is in session,or to the Legislative Budget and Audit Committee,if the legislature is not in session. Sec.44.83.920.Insurance requirements in construction contracts. In requesting bids and awarding construction contracts under this chapter the authority may not require a contractor to obtain workers'compensation,general liability,or other required insurance from a particular insurer,agent,or broker and may not agree to provide insurance to a contractor who is awarded a construction contract. Sec.44.83.930.Operation of projects. (a)When a project is operated by the authority,the authority shall enter into one or more contracts for the sale of electrical power,energy,transmission capacity,or service from the project. Unless the contract is entered into under former AS 44.83.380 -44.83.425,a contract entered into under this section must meet all requirements of AS 44.83.090. (b)[Repealed,Sec.27 ch 89 SLA 1983]. (c)[Repealed,Sec.92 ch 36 SLA 1990). Sec.44.83.940.Annual report. Before March 1 of each year,the authority shall submit to the governor a comprehensive report describing operations,income and expenditures for the preceding 12-month period.The authority shall notify the legislature that the report is available. Sec.44.83.950.Appropriations and reports. (a)Notwithstanding any other provision in this chapter,the authority is subject to the provisions of AS 37.07 (Executive Budget Act). (b)The authority shall,by the 15th day of each regular legislative session,prepare a report detailing project status,original costs,and projected costs,particularly highlighting any costs in excess of the original cost estimates submitted for each project when that project was originally approved by the legislature.The authority shall notify the legislature that the report is available. Sec.44.83.960.Long-term energy plan.[Repealed,Sec.16 ch 134 SLA 1990]. Repealed or Renumbered Sec.44.83.970.Public records;open meetings. The provisions of AS 40.25.110 -40.25.120 and AS 44.62.310 -44.62.319 (Open Meetings Act)apply to the authority.The authority shall publish a proposed agenda of its meetings and afford the public an opportunity to be heard in accordance with AS 44.62.312. Exhibit S-1 Page 13 of 14 Sec.44.83.990.Definitions. In this chapter,unless the context requires otherwise, (1)"authority”means the Alaska Energy Authority established by this chapter; (2)"bonds"means bonds,notes,or other obligations of the authority issued under this chapter; (3)"feasibility study" (A)means a study conducted for the purpose of establishing the economic and environmental practicality of completing a proposed power project; (B)includes engineering and design work to meet the requirements for submission of a license application for a proposed new project to the Federal Energy Regulatory Commission; (4)"person"includes a public agency in addition to the entities set out in AS 01.10.060(a)(8); (5)"power"includes any and all electrical energy generated,distributed,bought,or sold for purposes of lighting,heating,power,and every other useful purpose; (6)"power project"or "project"means a plant,works,system,or facility,together with related or necessary facilities and appurtenances,including a divided or undivided interest in or a right to the capacity of a power project or project,that is used or is useful for the purpose of (A)electrical or thermal energy production; (B)waste energy utilization and energy conservation;or (C)transmission,purchase,sale,exchange,and interchange of electrical or thermal energy, including district heating or interties; (7)"public agency"means any city or other municipal corporation,political subdivision, governmental unit,or public corporation created by or under the laws of this state or of another state of the United States,and any state or the United States,and any person,board,or other body declared by the laws of any state or the United States to be a department,agency,or instrumentality of them. Sec.44.83.995.Short title. This chapter may be cited as the Alaska Energy Authority Act. Exhibit S-1 Page 14 of 14 Exhibit S-2 Chapter 42.45.RURAL AND STATEWIDE ENERGY PROGRAMS Article 01.POWER ASSISTANCE PROGRAMS Sec.42.45.010.Power project fund. (a)The power project fund is established as a separate fund.The fund shall be distinct from any other money or funds of the authority and includes only money appropriated by the legislature, proceeds from the sale of loans appropriated by the legislature,and money deposited under (g)of this section. (b)The authority may make loans from the power project fund - (1)to electric utilities,regional electric authorities,municipalities,regional and village corporations,village councils,and independent power producers to pay the costs of (A)reconnaissance studies,feasibility studies,license and permit applications,preconstruction engineering,and design of power projects;and (B)constructing,equipping,modifying,improving,and expanding small-scale power production facilities that are designed to produce less than 10 megawatts of power,bulk fuel storage facilities,and transmission and distribution facilities,including energy production,transmission and distribution, waste energy,energy conservation,energy efficiency,and alternative energy facilities and equipment; (2)to a borrower for a power project or for bulk fuel,waste energy,energy conservation,energy efficiency,or alternative energy facilities or equipment if (A)the loan is entered into under a leveraged lease financing arrangement; (B)the party that will be responsible for the power project or the bulk fuel,waste energy, energy conservation,energy efficiency,or alternative energy facilities or equipment is an electric utility, regional electric authority,municipality,regional or village corporation,village council,or independent power producer;and (C)the borrower seeking the loan demonstrates to the authority that the financing arrangement for the power project or the bulk fuel,waste energy,energy conservation,energy efficiency,or alternative energy facilities or equipment will reduce financing costs for the project,facilities,or equipment below costs of comparable public power projects,facilities,or equipment. (c)Before making a loan from the power project fund,the authority shall,by regulation,specify (1)standards for the eligibility of borrowers and the types of projects to be financed with loans; (2)standards regarding the technical and economic viability and revenue self-sufficiency of eligible projects; (3)collateral or other security required for loans; (4)the terms and conditions of loans; (5S)criteria to establish financial feasibility and to measure the amount of state assistance necessary for particular projects to meet the financial feasibility criteria;and (6)other relevant criteria,standards,or procedures. Exhibit S-2 Page 1 of 17 (d)The authority may adopt regulations to establish the standards,criteria,and procedures for making loans under this section,including regulations to establish reasonable fees for applications and loan origination,and charges for reimbursement ofthe costs of analyzing the feasibility of a project. (e}Repayment of the loans shall be secured in any manner that the authority determines is feasible to assure prompt repayment under a loan agreement entered into with the borrower.The authority may make an unsecured loan from the power project fund to a borrower regulated by the Regulatory Commission of Alaska under AS 42.05 if the borrower has a substantial history of repaying long-term loans and the capacity to repay the loan.Under a loan agreement,repayment may be deferred for 10 years or until the project for which the loan is made has achieved earnings from its operations sufficient to pay the loan,whichever is earlier. (f)A loan for power projects and bulk fuel,waste energy,energy conservation,energy efficiency, and alternative energy facilities or equipment (1)may not be granted for a term that exceeds 50 years;and (2)shall be granted at an interest rate that is not less than zero percent and that is the lesser of (A)a rate equal to the percentage that is the average weekly yield of municipal bonds for the 12 months preceding the date of the loan,as determined by the authority from municipal bond yield rates reported in the 30-year revenue index of The Bond Buyer;or (B)a rate determined by the authority that allows the project to meet criteria of financial feasibility established under (c)of this section. (g)Loan repayments and interest earned by loans from the power project fund shall be deposited in the power project fund unless an appropriation to fund the loan directs otherwise. (h)The legislature may forgive the repayment of a loan made from the power project fund for a reconnaissance study or a feasibility study when the authority finds that the power project for which the loan was made is not feasible. (i)Money in the power project fund may be used by the legislature to make appropriations for costs of administering the fund. (j)The authority may not enter into a loan from the power project fund for a major project unless it has legislative approval of the project and the amount.An appropriation for the loan that names the project constitutes approval required by this subsection.A major project is a project in which the cumulative state monetary involvement,through loans,grants,and bonds,is at least $5,000,000 or a project for which a loan of more than $5,000,000 has been requested. (k)The authority may collect the fees and charges established under (d)of this section and shall deposit the money in the general fund. (I)The authority may sell loans of the power project fund with legislative approval.The authority may use money in the power project fund to repurchase loans sold under this subsection that default. Money received by the authority from the sale of loans under this subsection shall be deposited into the power project fund under (a)of this section. Sec.42.45.020.Rural electrification revolving loan fund. (a)The rural electrification revolving loan fund is established in the authority.The fund consists of (1)appropriations made to the fund;and Exhibit S-2 Page 2 of 17 (2)repayments of principal and interest on loans made under this section. (b)The authority may make loans from the rural electrification revolving loan fund to electric utilities certified under AS 42.05.A loan from the fund may be made only for the purpose of extending new electric service into an area of the state that an electric utility may serve under a certificate of public convenience and necessity issued under AS 42.05.A loan may be made from the fund to an electric utility if the utility invests the money necessary to provide one pole,one span of line,one transformer,and one service drop for each consumer for whom immediate service would be provided by the extension of electric service.However,a loan may not be made from the fund unless the extension of electric service would provide immediate service to at least three consumers. (c)A loan from the rural electrification revolving loan fund shall bear an annual rate of interest of two percent of the unpaid balance ofthe loan. (d)When the authority makes a loan under this section,the electric utility receiving the loan shall, (1)in addition to the rates that it is authorized to charge,charge the consumers served by the electric service extended with the loan proceeds an amount sufficient to pay the interest costs of the loan; (2)pay to the authority annually an amount equal to (A)interest of two percent on the unpaid balance of the loan;and (B)payments on the unpaid balance of the principal of the loan for each new consumer served by the electric service extended with the loan proceeds;payments on the unpaid balance of the principal of the loan shall be made at a rate equal to the difference between the actual cost of making the service connection to the consumers and the minimum investment per consumer required of the utility before a loan is made under (b)of this section. (e)The authority shall (1)adopt regulations necessary to carry out the provisions of this section;and (2)administer the rural electrification revolving loan fund. (f)Money in the rural electrification revolving loan fund may be used by the legislature to make appropriations for costs of administering the fund. (g)On June 30 of each fiscal year the unexpended and unobligated cash balance ofthe fund that is attributable to loans owned by the fund lapses into the general fund. (h)In this section, (1)"consumer"means a person or a governmental agency,if the person or governmental agency requests and offers to pay for electrical service to a facility or part of a facility;the authority shall consider a person who,or a governmental agency that,offers to pay for electrical service to several facilities to be a separate consumer for each facility,if each facility is physically separate from another facility,other than through electric service lines,and if the person or governmental agency requests and offers to pay for electrical service to each facility; (2)"facility"means a structure capable of receiving and using electrical energy;and (3)"governmental agency"includes,with respect to the state or federal government ora municipal government,a legislative body,board of regents,administrative body,board,commission, committee,subcommittee,authority,council,agency,public corporation,school board,department, Exhibit S-2 Page 3 of 17 division,bureau,or other subordinate unit,whether advisory or otherwise,of the state,federal,or municipal government. Sec.42.45.030.Loan advisory committee.[Repealed,Sec.84 ch 58 SLA 1999]. Repealed or Renumbered Sec.42.45.040.Southeast energy fund. (a)The Southeast energy fund is established as a separate fund.The fund consists of (1)money appropriated to the fund by the legislature; (2)money transferred to it under former AS 42.45.050; (3)gifts,bequests,contributions from other sources,and federal money; (4)interest earned on the fund balance;and (S)investments,to be managed by the Department of Revenue,which shall be the fiduciary of the fund under AS 37.10.071. (b)The fund is not a dedicated fund. (c)The authority may make grants from the Southeast energy fund to a municipality of the state,a joint action agency established under AS 42.45.300 and 42.45.310,a member-owned electric cooperative established under AS 10.25,or another electric utility holding a certificate of public convenience and necessity under AS 42.05 for power projects,repayment of loans,and payments on bonds for hydroelectric projects and electrical transmission lines or interties serving Southeast Alaska that are entirely owned by the grantee. (d)An appropriation from the fund for a project described in (c)of this section Japses back into the fund if substantial,ongoing work on the project has not begun within seven years after the effective date of the appropriation. Sec.42.45.045.Renewable energy grant fund and recommendation program. (a)A renewable energy grant fund is established as a separate fund to finance certain energy projects in Alaska. (b)The authority shall administer the fund as a fund distinct from other funds of the authority. The fund consists of (1)money appropriated to the fund by the legislature to provide grants for certain energy projects determined by the legislature; (2)gifts,bequests,contributions from other sources,and federal money; (3)interest earned on the fund balance;and (4)investments to be managed by the Department of Revenue,which shall be the fiduciary of the fund under AS 37.10.071. (c)The fund is not a dedicated fund. (d)The authority shall,in consultation with the advisory committee established under (i)of this section and the Department of Natural Resources, (1)develop a methodology for determining the order of projects that may receive assistance, including separate requirements for grant eligibility,and adopt regulations identifying criteria to evaluate the benefit and feasibility of projects for which an applicant applies for support from the Exhibit S-2 Page 4 of 17 legislature,with the most weight being given to projects that serve any area in which the average cost of energy to each resident of the area exceeds the average cost to each resident of other areas of the state,and significant weight being given to a statewide balance of grant funds and to the amount of matching funds an applicant is able to make available; (2)make recommendations to the legislature for renewable power production reimbursement grants;and (3)not later than 10 days after the first day of each regular legislative session,submit to the legislature a report summarizing and reviewing each grant application submitted under this section and a recommended priority for awarding grants. (e)In consultation with the advisory committee established in (i)of this section,the authority shall make recommendations to the legislature regarding eligible applicants'projects that finance feasibility studies,reconnaissance studies,energy resource monitoring,and construction of renewable energy projects,natural gas projects,or transmission or distribution infrastructure located in Alaska that meet the requirements of (f),(g),or (h)of this section,as applicable,and shall,at least once each year, solicit from the advisory committee funding recommendations for all grants. (f)For a renewable energy project to qualify for a grant recommendation under (e)of this section,the project must (1)be a new project not in operation on August 20,2008 or an addition to an existing project made after August 20,2008;and (2)bea (A)hydroelectric facility; (B)direct use of renewable energy resources; (C)facility that generates electricity from fuel cells that use hydrogen from renewable energy resources or natural gas;or (D)facility that generates energy from renewable energy resources. (g)To qualify for a grant recommendation under (e)of this section,a project that is a natural gas project must benefit a community that (1)has a population of 10,000 or less;and (2)does not have economically viable renewable energy resources it can develop. (h)To qualify for a grant recommendation under (e)of this section,transmission or distribution infrastructure must link a renewable energy project or natural gas project to the transmission or distribution infrastructure.A grant may be recommended under this subsection even if the grant applicant is not itself financing the construction of the renewable energy project or natural gas project. {i}An advisory committee is established and consists of nine members,appointed as follows: (1)five members shall be appointed by the governor to staggered three-year terms,with one representative to be appointed from each of the following groups: (A)small Alaska rural electric utilities; (B)large Alaska urban electric utilities; (C)Alaska Native organizations; (D)businesses or organizations engaged in the renewable energy sector;and (E)the Denali Commission established under P.L.105-277,42 U.S.C.3121 note; Exhibit S-2 Page 5 of 17 (2)two members ofthe house of representatives shall be appointed by the speaker of the house of representatives;and (3)two members of the senate shall be appointed by the president of the senate. (j)A member of the advisory committee appointed under (i)of this section serves without compensation but is entitled to travel and per diem expenses as provided in AS 39.20.180. (k)The legislature may appropriate money for grants from the renewable energy grant fund for renewable energy projects described in this section. (I)In this section, (1)"eligible applicant"means an electric utility holding a certificate of public convenience and necessity under AS 42.05,independent power producer,local government,or other governmental utility,including a tribal council and housing authority; (2)"fund"means the renewable energy grant fund; (3)"hydroelectric facility"has the meaning given to the term "project"under AS 42.45.350; (4)"natural gas project"means use or access of natural gas other than landfill or digester gas; (5)"renewable energy resources"means (A)wind,solar,geothermal,wasteheat recovery,hydrothermal,wave,tidal,river in-stream,or hydropower; (B)low-emission nontoxic biomass based on solid or liquid organic fuels from wood,forest and field residues,or animal or fish products; (C)dedicated energy crops available on a renewable basis;or (D)landfill gas and digester gas. Sec.42.45.050.Four dam pool transfer fund.[Repealed,Sec.12 ch 60 SLA 2000]. Repealed or Renumbered Sec.42.45.060.Approval by loan committee and legislature.[Repealed,Sec.11 ch 36 SLA 2004]. Repealed or Renumbered Sec.42.45.065.Reimbursement for costs of power projects. (a)Subject to appropriations for the purpose,during each fiscal year,the authority shall allocate to each entity listed in (b)of this section an amount to reimburse the cost paid by the entity during the immediately preceding fiscal year for the principal and interest on outstanding debt for the project listed.An allocation may be made to an entity only if (1)the debt was incurred before July 1,2005;and (2)the power project financed with the debt proceeds is owned and operated by the entity. (b)The authority may make an allocation to an entity under (a}of this section only for reimbursement of costs incurred for construction and renovation ofthe following power projects and only for reimbursement of total project costs incurred up to the following amounts: PROJECT Kodiak Electric Association,Inc.(Nyman S$6,000,000 Combined Cycle Cogeneration Plant) Exhibit S-2 Page 6 of 17 Cordova Electric Cooperative (Power Creek 12,000,000 Hydropower Station) Golden Valley Electric Association (Rock Creek 700,000 line extension) Copper Valley Electric Association,Inc.,10,000,000 Valdez (cogeneration projects) The Four Dam Pool Power Agency (Southeast 20,000,000 Intertie,Swan Lake to Tyee Lake) Metlakatla Power and Light (utility plant and 3,000,000 capital additions) Article 02.POWER COST EQUALIZATION ENDOWMENT FUND Sec.42.45.070.Power cost equalization endowment fund established. (a)The power cost equalization endowment fund is established as a separate fund of the authority.The fund consists of (1)legislative appropriations to the fund that are not designated for annual expenditure for the purpose of power cost equalization; (2)accumulated earnings of the fund; (3)gifts,bequests,contributions of money and other assets,and federal money given to the fund that are not designated for annual expenditure for power cost equalization;and (4)[Repealed,Sec.13 ch 60 SLA 2000]. (b)Nothing in this section creates a dedicated fund. (c)[Repealed,Sec.13 ch 60 SLA 2000]. Sec.42.45.080.Powers and duties of the commissioner of revenue. (a)The commissioner of revenue is the fiduciary of the fund.In managing the fund,the commissioner shall (1)have the same powers and duties as are provided in AS 37.10.071;and (2)invest the fund in a manner likely to achieve at least a seven percent nominal return over time. (b)In managing the fund,the commissioner shall (1)consider the status of the fund's capital and the income generated on both current and probable future bases; (2)determine the appropriate investment objectives; (3)establish investment policies to achieve the objectives;and (4)act only in regard to the best financial interests of the fund. (c)On July 1 of each year,the commissioner shall determine the monthly average market value of the fund for the previous three fiscal years. Exhibit S-2 Page 7 of 17 Sec.42.45.085.Use of the power cost equalization endowment fund. (a)Seven percent of the amount determined by the commissioner of revenue on July 1 of each year under AS 42.45.080(c)may be appropriated for the fiscal year beginning the following July 1 for the following purposes: (1)funding the power cost equalization and rural electric capitalization fund (AS 42.45.100); (2)reimbursement to the Department of Revenue for the costs of establishing and managing the fund;and (3)reimbursement of other costs of administration of the fund. (b)Nothing in this section creates a dedicated fund. Sec.42.45.099.Definition. In AS 42.45.070 -42.45.099,"fund"means the power cost equalization endowment fund established in AS 42.45.070. Article 03.POWER COST EQUALIZATION AND RURAL ELECTRIC CAPITALIZATION Sec.42.45.100.Power cost equalization and rural electric capitalization fund. (a)The power cost equalization and rural electric capitalization fund is established as a separate fund for the purpose of (1)equalizing power cost per kilowatt-hour statewide at a cost close to or equal to the mean of the cost per kilowatt-hour in Anchorage,Fairbanks,and Juneau by paying money from the fund to eligible electric utilities in the state;and (2)making grants to eligible utilities under AS 42.45.180 to improve the performance of the utility. (b)The fund shall be administered by the authority as a fund distinct from the other funds of the authority.The fund is composed of (1)money appropriated to provide power cost equalization to eligible electric utilities and to provide grants for utility improvements; (2)money appropriated from the National Petroleum Reserve -Alaska special revenue fund under AS 37.05.530(g); (3)money appropriated from the power cost equalization endowment fund (AS 42.45.070) under AS 42.45.085(a); (4)gifts,bequests,contributions from other sources,and federal money;and (S)interest earned on the fund balance. (c)The fund is not a dedicated fund. Sec.42.45.110.Entitlement to power cost equalization. (a)The costs used to calculate the amount of power cost equalization for all electric utilities eligible under AS 42.45.100 -42.45.150 include all allowable costs,except return on equity,used by the Regulatory Commission of Alaska to determine the revenue requirement for electric utilities subject to rate regulation under AS 42.05.The costs used in determining the power cost equalization per kilowatt- hour shall exclude any other type of assistance that reduces the customer's costs of power ona kilowatt-hour basis and that is provided to the electric utility within 60 days before the commission determines the power cost equalization per kilowatt-hour of the electric utility.In calculating power cost Exhibit S-2 Page 8 of 17 equalization,the commission may not consider validated costs or kilowatt-hour sales associated with a United States Department of Defense facility. (b)An eligible electric utility is entitled to receive power cost equalization (1)for sales of power to loca!community facilities,calculated in the aggregate for each community served by the electric utility,for actual consumption of not more than 70 kilowatt-hours a month for each resident of the community;the number of community residents shall be determined annually by the latest figures of the United States Bureau of the Census or other population data that the Department of Commerce,Community,and Economic Development determines is reliable;and (2)for actual consumption of not more than 500 kilowatt-hours a month sold to each residential customer. (c)The amount of power cost equalization provided for each kilowatt-hour under (b)of this section may not exceed 95 percent of the power costs,or the average rate for each eligible kilowatt- hour sold,whichever is less,as determined by the commission.However, (1)the power costs for which power cost equalization are paid to an electric utility are limited to minimum power costs of more than 12 cents a kilowatt-hour and less than $1 a kilowatt-hour; (2)each year,the commission shall adjust the power costs for which power cost equalization may be paid to an electric utility based on the weighted average retail residential rate in Anchorage, Fairbanks,and Juneau;however,the commission may not adjust the power costs under this paragraph to reduce the amount below the lower limit set out in (1)of this subsection;and (3)the power cost equalization for each kilowatt-hour may be determined for a utility without historical kilowatt-hour sales data by using kilowatt-hours generated. (d)An electric utility whose customers receive power cost equalization under AS 42.45.100 - 42.45.150 shall set out in its tariff the rates without the power cost equalization and the amount of power cost equalization per kilowatt-hour sold.The rate charged to the customer shall be the difference between the two amounts.Power cost equalization paid under AS 42.45.100 -42.45.150 shall be used to reduce the cost of all power sold to local community facilities,in the aggregate,to the extent of 70 kilowatt-hours per month per resident of the community,and to reduce the cost of the first 500 kilowatt-hours per residential customer per month. (e)The power cost equalization program shall be administered by the authority based ona determination by the commission under (a)and (c)of this section of power cost equalization per kilowatt-hour for each eligible electric utility. (f)The authority may not deny an eligible electric utility power cost equalization because complete cost information is not available.The commission shall assist an eligible electric utility that is exempt from rate regulation under AS 42.05 to provide the cost information the commission considers necessary to comply with AS 42.45.100 -42.45.150.Only power costs that are supportable may be considered in calculating power cost equalization.Each electric utility is responsible for keeping records that provide the information necessary to comply with AS 42.45.100 -42.45.150 including records of monthly kilowatt-hour sales or generation,monthly fuel balances,fuel purchases,and monthly utility fuel consumption. (g)The commission shall determine the cost of fuel for each eligible electric utility using the procedure for approving fuel cost rate adjustments of electric utilities subject to rate regulation under AS 42.05. Exhibit S-2 Page 9 of 17 (h)Each electric utility receiving power cost equalization approved by the commission shall (1)report monthly to the authority within the time and in the form the authority requires;and (2)use operational equipment designed to meter individual utility customer power consumption and to determine and record the utility's overall fuel consumption. (i)The authority shall review the report required under (h)of this section.After review and approval of the report,the authority shall,subject to appropriation,pay to each eligible electric utility an amount equal to the power cost equalization per kilowatt-hour determined under (a)and (c)of this section,multiplied by the number of kilowatt-hours eligible for power cost equalization that were sold during the preceding month to all customers of the utility under (b)of this section.Payment shall be made by the authority within 30 days after receipt from the utility of the report required under (h)of this section.If appropriations that have been made for the purpose by July 1 of a fiscal year are insufficient for payment in full,the amount paid to each electric utility shall be reduced on a pro rata basis.In making the pro rata reductions required by this subsection,the authority may not consider any potential supplemental appropriation until the appropriation has been enacted. Sec.42.45.115.Exclusion from eligibility. (a)Notwithstanding the definition of "eligible electric utility"in AS 42.45.150,an electric utility whose primary source of power for sale to customers is one or more of the power projects that were part of the former initial project may not be considered an eligible electric utility. (b)In this section,"former initial project"includes the Tyee Lake,Swan Lake,Solomon Gulch, and Terror Lake hydroelectric facilities. Sec.42.45.120.Notice to customers. If an electric utility receives power cost equalization under AS 42.45.100 -42.45.150,the utility shall either give to its electric service customers eligible under this program,for each period for which the payment is received, (1)the following notice: NOTICE TO CUSTOMER For the most recent monthly reporting period under the State of Alaska's power cost equalization program,this utility's actual fuel efficiency for your community was kilowatt-hours a gallon.The applicable fuel efficiency standard set out in regulations for the power cost equalization program is kilowatt-hours a gallon. For the current billing period,the utility will be paid under the State of Alaska's power cost equalization program (AS 42.45.100) to assist the utility and its customers in reducing the high cost of generation of electric energy. Your total electrical service cost S ceeeeee Less state equalization S veces Your charge S veces ;or (2)a notice approved by the authority that provides electric service customers the same information provided by the notice in (1) ofthis section. Exhibit S-2 Page 10 of 17 Sec.42.45.130.Cost minimization. (a)In order to qualify for power cost equalization,each electric utility shall make every reasonable effort to minimize administrative,operating,and overhead costs,including using the best available technology consistent with sound utility management practices.In reviewing applications for power cost equalization,the commission may require the elimination of unnecessary operating expenses.Each eligible electric utility shall cooperate with appropriate state agencies to implement cost-effective energy conservation measures and to plan for and implement feasible alternatives to diesel generation. (b)In this section,"energy conservation measures"include weatherization and other insulating methods,utilization of waste heat,appropriate sizing of new generating equipment,and other programs of the state or federal government intended and available for energy conservation. Sec.42.45.140.Customer petitions. If the authority receives a petition requesting power cost equalization,signed by at least 25 percent of the customers of an electric utility that is subject to rate regulation under AS 42.05 and that has not applied for power cost equalization under AS 42.45.100 -42.45.150,the authority shall require the utility to submit a power cost equalization application.Upon a determination of eligibility for power cost equalization,the utility,as a part of its service,shall receive power cost equalization and pass power cost equalization benefits to its customers under AS 42.45.100 -42.45.150. Sec.42.45.150.Definitions for AS 42.45.100 -42.45.150. In AS 42.45.100 -42.45.150, (1)"community facility"means a water and sewer facility,public outdoor lighting,charitable educational facility,or community building whose operations are not paid for by the state,the federal government,or private commercial interests; (2)"eligible electric utility"or "electric utility"means a public,cooperative,or other corporation, company,individual,or association of individuals,and includes the lessees,trustees,or receivers appointed by a court,that (A)owns,operates,manages,or controls a plant or system for the furnishing,by generation, transmission,or distribution,of electric service to the public for compensation; (B)during calendar year 1983,had a residential consumption level of power eligible for power cost equalization under former AS 44.83 of less than 7,500 megawatt hours or had a residential consumption level of power eligible for power cost equalization under former AS 44.83 of less than 15,000 megawatt hours if the utility served two or more municipalities or unincorporated communities; and (C)during calendar year 1984,used diesel fired generators to produce more than 75 percent of the electrical consumption of the utility;an electric utility that is a subsidiary of another electric utility is an "eligible electric utility”if the operations of the subsidiary,considered separately,meet the eligibility requirements of AS 42.45.100 -42.45.150;if an electric utility did not receive power cost assistance in 1983 but is otherwise eligible for power cost equalization under AS 42.45.100 -42.45.150,the utility is an "eligible electric utility"; Exhibit S-2 Page 11 of 17 (3)"power costs"means costs used in determining power cost equalization under AS 42.45.110(a)and (c). Sec.42.45.160.Adjustments to power cost equalization. (a)The commission may adjust the power cost equalization per kilowatt-hour,determined under AS 42.45.100 -42.45.150,payable to an electric utility that is subject to rate regulation under AS 42.05 if the (1)commission has approved a fuel cost rate adjustment caused by an increase or decrease in the electric utility's cost of fuel; (2)commission has approved a permanent or interim rate increase or decrease that establishes a higher or lower power cost; (3)authority has discovered,in reviewing the monthly data submitted by the electric utility, discrepancies that require adjustment of the power cost equalization;or (4)authority determines that appropriations are insufficient to finance full payments to eligible electric utilities. (b)An electric utility that is eligible to receive power cost equalization under this section and that receives power cost equalization per kilowatt-hour approved by the commission shall report monthly to the authority within the time and in the form the authority requires.An electric utility shall report (1)the power cost equalization per kilowatt-hour approved by the commission; (2}the total kilowatt-hours sold to each class of customer during the preceding month; (3)the total kilowatt-hours eligible for power cost equalization under this section sold to each class of customer during the preceding month; (4)the total kilowatt-hours generated during the preceding month,if available; (5)any commission approved amendments to the schedule of rates in effect during the preceding month;and (6)an increase or decrease in the current unit price of fuel from the base price used by the commission in determining power costs if the change is expected to result in a subsequent power cost equalization adjustment. (c)The provisions of AS 42.45.100 -42.45.150 relating to the determination of the amount of power cost equalization and payment of the equalization assistance apply to equalization assistance under this section. Sec.42.45.170.Equalization assistance to unregulated utilities. (a)An electric utility that is not subject to rate regulation by the Regulatory Commission of Alaska under AS 42.05 may receive power cost equalization if the utility is otherwise eligible for equalization assistance under AS 42.45.100 -42.45.150 andif the utility (1)files with the commission financial data necessary to determine the power cost equalization per kilowatt-hour as prescribed by the commission and that is in compliance with AS 42.45.100 - 42.45.150; (2)reports monthly to the authority,within the time and in the form required,the information required in (b)of this section; Exhibit S-2 Page 12 of 17 (3)sets rates (A)that consider the power cost equalization provided under AS 42.45.100 -42.45.150 by subtracting from its revenue requirements for electric services the power cost equalization per kilowatt- hour that it is eligible to receive;and (B)under which the power cost equalization provided in AS 42.45.070 -42.45.110 is applied as a credit only against the cost of kilowatt-hours eligible for equalization assistance under AS 42.45.100 - 42.45.150 that are consumed by each customer in any month; (4)allows audits that the commission determines are necessary to ensure compliance with this section;and (5)furnishes its electric service customers eligible under this program a notice as specified in AS 42.45.120. (b)An electric utility that is eligible to receive power cost equalization under this section shall report in accordance with (a)(2)of this section (1)the power cost equalization per kilowatt-hour approved by the commission; (2)the total kilowatt-hours sold to each class of customer during the preceding month; (3)the total kilowatt-hours eligible for power cost equalization under this section sold to each class of customer during the preceding month; (4)the total kilowatt-hours generated during the preceding month,if available; (5)any amendments to the schedule of rates in effect during the preceding month;and (6)an increase or decrease in the current unit price of fuel from the base price used by the commission in determining power costs if the change is expected to result in a subsequent equalization assistance level adjustment. (c)An electric utility that is eligible to receive power cost equalization under this section may have its power cost equalization per kilowatt-hour determination changed by the commission if the (1)commission has verified an increase or decrease in the electric utility's cost of fuel; (2)commission has verified an increase in rates based on an increase in costs; (3)authority has discovered,in reviewing the monthly data submitted by the electric utility, discrepancies that require adjustment of the power cost equalization;or (4)authority determines that appropriations are insufficient to finance full payments to eligible electric utilities. (d)The provisions of AS 42.45.100 -42.45.150 relating to the determination of the amount of power cost equalization and payment of the equalization assistance apply to equalization assistance under this section. (e)An application for power cost equalization by an electric utility that is eligible to receive power cost under this section does not extend the jurisdiction of the Regulatory Commission of Alaska beyond that established by AS 42.05. Sec.42.45.180.Grants for utility improvements. (a)The authority may make a grant from the fund for an eligible utility for a small power project that will reduce the cost of generating or transmitting power to the customers of the utility.The amount of the grant may not exceed 75 percent of the cost of the project.The authority may not make a grant under this section unless the eligible utility has secured financing for 25 percent of the cost of the Exhibit S-2 Page 13 of 17 project from a source other than the power cost equalization and rural electric capitalization fund,as provided under (c)of this section. (b)The authority may not allocate more than three percent of the balance in the fund to grants under this section in a fiscal year. (c)In determining whether an eligible utility has secured financing for 25 percent of the cost of the project from a source other than the power cost equalization and rural electric capitalization fund, the authority shall accept solicited and unsolicited proposals for third party financing or for a joint venture between the utility and an entity from the private sector provided that the private sector participant has (1)a valid state business license; (2)a resolution or letter of agreement executed by the eligible utility agreeing to participation by the private sector participant; (3)a business plan that illustrates how the proposed project will reduce the cost of generating or transmitting power to the customers ofthe utility. (d)In this section, (1)"eligible utility"has the meaning given in AS 42.45.150; (2)"project"includes (A)power generation systems; (B)transmission systems; (C)distribution systems; (D)metering systems; (E)energy store systems; (F)energy conservation programs;and (G)bulk fuel storage facilities; (3)"small power project"means a new or modified project that will either generate,store,or conserve no more than 1.5 megawatts of power or provide a metering system,transmission system, distribution system,or bulk fuel storage facility that has an estimated cost of less than $3,000,000. Sec.42.45.190.Definition for AS 42.45.100 -42.45.190. In AS 42.45.100 -42.45.190,"fund"means the power cost equalization and rural electric capitalization fund established under AS 42.45.100. Sec.42.45.200.Electrical service extension fund established.[Repealed,Sec.12 ch 36 SLA 2004]. [Sections in AS 42.45 inapplicable to AEA are deleted] Article 07.EMERGING ENERGY TECHNOLOGY FUND Sec.42.45.375.Emerging energy technology fund. (a)In order to promote the expansion of energy sources available to Alaskans,the emerging energy technology fund is established.The fund consists of (1)money appropriated to the fund by the legislature to provide grants for energy projects;and Exhibit S-2 Page 14 of 17 (2)gifts,bequests,contributions from other sources,and federal money appropriated to the fund. (b)The fund is not a dedicated fund. (c)The fund shall be administered by the authority,but the authority may contract for the investment of money appropriated to the fund but not disbursed for a grant.The authority,in consultation with the advisory committee established under (f)of this section,may make grants from the fund to eligible applicants for demonstration projects of technologies that have a reasonable expectation to be commercially viable within five years and that are designed to (1)test emerging energy technologies or methods of conserving energy; (2)improve an existing energy technology;or (3)deploy an existing technology that has not previously been demonstrated in the state. (d)In making grants under this section,the authority,in consultation with the advisory committee established under (f)of this section,shall give priority to (1)Alaska residents,associations,organizations,or institutions; (2)projects that demonstrate partnership with the University of Alaska or another Alaska postsecondary institution; (3)projects supported by matching funds or in-kind partnerships;and (4)projects with potential for widespread deployment in the state. (e)In administering the fund,the authority may enter into a contract or agreement with the University of Alaska to provide technical and economic review and analysis for the advisory committee established under (f)of this section and data acquisition and analysis of the projects awarded grants. (f)An advisory committee is established and consists of seven members.Each member of the committee shall have a degree in science or engineering,or equivalent professional experience,and at least two years of experience working in the state.Members of the committee shall be appointed by the governor to staggered three-year terms.The committee consists of one representative of each of the following groups: (1)a business or organization engaged in the renewable energy sector; (2)a business or organization engaged in the fossil fuel energy sector; (3)the Alaska Power Association or an Alaska electric utility; (4)the Denali Commission established under P.L.105-277 and mentioned in a note at 42 U.S.C. 3121; (5)the National Renewable Energy Laboratory; (6)the Arctic Energy Office of the National Energy Technology Laboratory; (7)the Alaska Industrial Development and Export Authority. (g)A member of the advisory committee appointed under (f)of this section serves without compensation but is entitled to per diem and travel expenses as provided in AS 39.20.180. (h)lf a member ofthe advisory committee appointed under (f)(4),(5),or (6)of this section is not available to serve as a member of the committee,the governor shall appoint a representative from a federal agency or department with a comparable mission or purpose to the agency listed in (f)(4),(5),or (6)of this section to fill the position on the committee.If a representative from a federal agency or department is not available to fill the position,the governor may appoint a member from a state agency or department. Exhibit S-2 Page 15 of 17 {i)A business or organization represented by a member of the advisory committee under (f)of this section is not eligible to receive a grant from the fund. (j)In this section, (1)"eligible applicant"means (A)an electric utility holding a certificate of public convenience and necessity under AS 42.05; (B)an independent power producer; (C)a local government,quasi-governmental entity,or other governmental entity,including a tribal council or housing authority; (D)a business holding an Alaska business license;or (E)a nonprofit organization; (2)"energy technology"means technology that promotes,enhances,or expands the diversity of available energy supply sources or means of transmission,increases energy efficiency,or reduces negative energy-related environmental effects;"energy technology"includes technology related to renewable sources of energy,conservation of energy,enabling technologies,efficient and effective use of hydrocarbons,and integrated energy systems; (3)"fund"means the emerging energy technology fund. Article 08.MISCELLANEOUS PROVISIONS Sec.42.45.400.[Renumbered as AS 42.45.900]. Repealed or Renumbered Sec.42.45.410.[Renumbered as AS 42.45.910]. Repealed or Renumbered Sec.42.45.900.Assistance to rural utilities. (a)The authority shall provide technical assistance to rural utilities including catastrophe prevention programs and other training programs for utility projects.The authority shall provide rural utilities with the technical assistance and training that the utilities need to improve the efficiency, safety,and reliability of their power systems and to prevent emergency situations from developing.At a minimum,the assistance and training must include information on (1)reducing distribution line losses; (2)installation of generators that are more fuel efficient; (3)preventative maintenance programs; (4)safety inspections; (5)installing and maintaining waste heat systems; (6)improved metering systems; (7)improved management and administration;and (8)coordinating regional activities,including circuit rider maintenance programs. (b)In providing rural utilities with technical assistance and training,the authority shall give priority to contracting with the private sector for these services. Exhibit S-2 Page 16 of 17 (c)This section does not create a duty in tort,and may not be the basis for an action against the state,the authority,or the officers,employees,agents,or contractors of either for damages,injury,or death. Sec.42.45.910.Relationship with private sector. The authority shall,to the maximum extent feasible,carry out its powers and duties under this chapter by entering into contracts with appropriate entities in the private sector. Article 09.GENERAL PROVISIONS Sec.42.45.990.Definitions. In this chapter,unless the context otherwise requires, (1)"authority"means the Alaska Energy Authority; (2)"feasibility study" (A)means a study conducted to establish the economic and environmental practicality of completing a proposed power project; (B)includes engineering and design work to meet the requirements for submission of a license application for a proposed new project to the Federal Energy Regulatory Commission; (3)"power"includes electrical energy generated,distributed,bought,or sold for lighting, heating,power,and every other useful purpose; (4)"power project"or "project"means a plant,works,system,or facility,together with related or necessary facilities and appurtenances,including a divided or undivided interest in or a right to the capacity of a power project or project,that is used or is useful for the purpose of {A)electrical or thermal energy production; (B)waste energy utilization and energy conservation;or (C)transmission,purchase,sale,exchange,and interchange of electrical or thermal energy, including district heating or interties; (5)"reconnaissance study"means a study conducted to assess the present and future electrical and thermal energy needs of an area. Exhibit S-2 Page 17 of 17 Exhibit S-3 Chapter 36.30.STATE PROCUREMENT CODE Article 01.ORGANIZATION OF STATE PROCUREMENT Sec.36.30.005.Centralization of procurement authority. (a)Except as otherwise provided,all rights,powers,duties,and authority relating to the procurement of supplies,services,and professional services,and the control over supplies,services,and professional services vested in or exercised by an agency on January 1,1988,are transferred to the commissioner of administration and to the chief procurement officer.Authority granted under this subsection shall be exercised in accordance with this chapter. (b)Except as otherwise provided,all rights,powers,duties,and authority relating to the procurement of construction and procurements of equipment or services for the state equipment fleet and the control over construction of state facilities and the state equipment fleet vested in or exercised by an agency on January 1,1988,are transferred to the commissioner of transportation and public facilities,subject to regulations adopted by the commissioner of administration.Notwithstanding AS 44.68.110,authority relating to disposals from the state equipment fleet is vested in the commissioner of transportation and public facilities,subject to regulations adopted by the commissioner of administration.Authority granted under this subsection shall be exercised in accordance with this chapter. (c)Notwithstanding other provisions of law,all rights,powers,duties,and authority relating to the procurement of supplies,services,professional services,and construction and the disposal of supplies for the University of Alaska are transferred to the Board of Regents.To the maximum extent possible,authority granted under this subsection shall be exercised in accordance with this chapter.The Board of Regents shall adopt regulations under this subsection that are substantially equivalent to the regulations adopted by the commissioner of administration to implement this chapter.For the purposes of this subsection,unless the context otherwise requires,in this chapter (1)"agency"means a subunit of the University of Alaska; (2)"attorney general"means the president of the University of Alaska; (3)"chief procurement officer"means a person designated by the president of the University of Alaska whose qualifications are substantially equivalent to those provided in AS 36.30.010(a); (4)"commissioner,""commissioner of administration,"or "commissioner of transportation and public facilities"means the Board of Regents or the president of the University of Alaska if so designated by the Board of Regents by regulations adopted under this subsection;and (5)"department"means the University of Alaska. Exhibit S-3 Page 1 of 57 (d)Notwithstanding the provisions of AS 36.30.627,the University of Alaska is not required to arbitrate construction contract claims unless the university specifically agrees to the arbitration. Sec.36.30.010.Chief procurement officer. (a)The commissioner shall appoint to the partially exempt service the chief procurement officer of the state.The chief procurement officer must have at least five years of prior experience in public procurement,including large scale procurement of supplies,services,or professional services,and must be a person with demonstrated executive and organizational ability.The chief procurement officer may be removed by the commissioner only for cause.The term of office of the chief procurement officer is six years. (b)Except as otherwise specifically provided in this chapter,the chief procurement officer shall (1)procure or supervise the procurement of all supplies,services,and professional services needed by an agency; (2)exercise general supervision and control over all inventories of supplies belonging to an agency and prescribe the manner in which supplies shall be purchased,delivered,stored,and distributed; (3)prescribe the time,manner,authentication,and form of making requisitions for supplies and services; (4)sell,trade,transfer between agencies,or otherwise dispose of surplus,obsolete,or unused supplies and make proper adjustments in the accounts of agencies concerned; (5)establish and maintain programs for the inspection,testing,and acceptance of supplies and services and the testing of samples submitted with bids; (6)prescribe standard forms for bids and contracts;and (7)provide for other matters that may be necessary to carry out the provisions of this chapter and the regulations adopted under this chapter. (c)While a person performs the duties of the chief procurement officer under this chapter,the person may not be employed in or appointed to another position with the state. (d)The annual salary of the chief procurement officer is range 25 of the salary schedule established in AS 39.27.011. Sec.36.30.015.Executive branch agencies. (a)The commissioner oftransportation and public facilities may delegate to another agency the authority to contract for construction.Before delegating authority to an agency under this subsection, the commissioner of transportation and public facilities shall make a written determination that the agency is capable of implementing the delegated authority.Notwithstanding delegation of authority Exhibit S-3 Page 2 of 57 under this subsection,contracts for construction are governed by this chapter and regulations adopted by the commissioner of administration under this chapter. (b)The commissioner of administration may delegate to an agency the authority to contract for and manage services,professional services,and supplies.Notwithstanding delegation of authority under this subsection,an agency's exercise of the authority is governed by this chapter and regulations adopted by the commissioner under this chapter.Before delegating authority to an agency under this subsection,the commissioner shall make a written determination that the agency is capable of implementing the delegated authority. (c)[Repealed,Sec.48 ch 137 SLA 1996]. (d)An agency may not contract for the services of legal counsel without the approval of the attorney general.An agency may not contract for the services of a hearing officer or administrative law judge for an administrative,quasi-judicial hearing without the approval of the attorney general and the chief administrative law judge of the office of administrative hearings (AS 44.64.010). (e)The board of directors of the Alaska Railroad Corporation and the board of directors of the Alaska Aerospace Corporation shall adopt procedures to govern the procurement of supplies,services, professional services,and construction.The procedures must be substantially equivalent to the procedures prescribed in this chapter and in regulations adopted under this chapter.Notwithstanding the other provisions of this subsection,the Alaska Railroad Corporation and the Alaska Aerospace Corporation shall comply with the five percent preference under AS 36.30.321(a),and,when the Department of Transportation and Public Facilities authorizes the Alaska Railroad Corporation to perform construction work instead of the Department of Transportation and Public Facilities,the Alaska Railroad Corporation shall use competitive sealed bidding or competitive sealed proposals under AS 36.30.100 -36.30.270 to procure the supplies,services,professional services,and construction services necessary for the work and,to ensure the state obtains the lowest cost for the project,may submit a bid or proposal for the work. (f)The board of directors of the Alaska Housing Finance Corporation,notwithstanding AS 18.56.088,the membership of the Alaska Industrial Development and Export Authority,notwithstanding AS 44.88.085,and the board of directors of the Knik Arm Bridge and Toll Authority under AS 19.75.111, shall adopt regulations under AS 44.62 (Administrative Procedure Act),and the board of trustees of the Alaska Retirement Management Board shall adopt regulations under AS 37.10.240,to govern the procurement of supplies,services,professional services,and construction for the respective public corporation and board.The regulations must reflect competitive bidding principles and provide vendors reasonable and equitable opportunities to participate in the procurement process and must include procurement methods to meet emergency and extraordinary circumstances.Notwithstanding the other provisions of this subsection,the Alaska Housing Finance Corporation,the Alaska Industrial Development and Export Authority,the Knik Arm Bridge and Toll Authority,and the Alaska Retirement Management Board shall comply with the five percent preference under AS 36.30.321(a). Exhibit S-3 Page 3 of 57 (g)The Department of Transportation and Public Facilities shall adopt regulations to manage the procurement of supplies,services,professional services,and construction for the repair,maintenance, and reconstruction of vessels,docking facilities,and passenger and vehicle transfer facilities of the Alaska marine highway system.The regulations must be based on principles of competitive procurement consistent with this chapter to satisfy the special requirements of the Alaska marine highway system as determined by the Department of Transportation and Public Facilities. (h)The board of directors of the Alaska Seafood Marketing Institute shall adopt procedures to govern the procurement of supplies,services,and professional services.The procedures must be similar to the procedures prescribed in this chapter and in regulations adopted under this chapter,except that the Alaska Seafood Marketing Institute shall comply with the five percent preference under AS 36.30.321(a). (i)Notwithstanding (e)of this section and the authority to delegate under (a)of this section,the Alaska Railroad Corporation,rather than the Department of Transportation and Public Facilities,shall perform signalization and flagging work,may perform the signalization and flagging work by itself or by using contractors,and,if it decides to use contractors for the work,it shall obtain the contractors by using its procurement procedures adopted under (e)of this section. (j)Notwithstanding the other provisions of this chapter,when a project of the Department of Transportation and Public Facilities includes construction of rails,ties,or ballast for railroad tracks used by the Alaska Railroad Corporation,the Department of Transportation and Public Facilities may enter into an agreement with the Alaska Railroad Corporation for the Alaska Railroad Corporation to perform the work,and the Alaska Railroad Corporation may perform the work itself without procuring a contractor to provide the supplies,services,professional services,or construction services necessary for the work. (k)Notwithstanding (d)of this section,the Public Defender Agency and the office of public advocacy are not required to obtain the approval of the attorney general to contract for the services of legal counsel in a matter where the attorney general is an adverse party. Sec.36.30.020.Legislature. The legislative council shall adopt and publish procedures to govern the procurement of supplies, services,professional services,and construction by the legislative branch.The procedures must be based on the competitive principles consistent with this chapter and must be adapted to the special needs of the legislative branch as determined by the legislative council.The procedures must contain provisions for prohibiting procurement from a person that has headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C).The procedures may contain provisions for restricting procurement from a person that conducts business in but does not have headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C. 7107(b)(1)(C).The procedures must be consistent with the provisions of AS 36.30.080(c)-(e)and Exhibit S-3 Page 4 of 57 36.30.085.Notwithstanding the other provisions of this section,the legislative agencies subject to the legislative council's regulations shall comply with the five percent preference under AS 36.30.321(a). Sec.36.30.030.Court system. The administrative director of the Alaska Court System shall adopt and publish procedures to govern the procurement of supplies,services,professional services,and construction by the judicial branch.The procedures must be based on the competitive principles consistent with this chapter and must be adapted to the special needs ofthe judicial branch as determined by the administrative director of the Alaska Court System.The procedures must contain provisions for prohibiting procurement from a person that has headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C).The procedures may contain provisions for restricting procurement from a person that conducts business in but does not have headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C).The procedures must be consistent with the provisions of AS 36.30.080(c)-(e)and 36.30.085.Notwithstanding the other provisions of this section,the judicial branch shall comply with the five percent preference under AS 36.30.321(a). Sec.36.30.040.Procurement regulations. (a)The commissioner shall adopt regulations governing the procurement,management,and control of supplies,services,professional services,and construction by agencies.The regulations must contain provisions for prohibiting procurement from a person that has headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C).The regulations may contain provisions for restricting procurement from a person that conducts business in but does not have headquarters in a country listed in Tier 3 of the most recent Trafficking in Persons Report published by the United States Secretary of State under 22 U.S.C.7107(b)(1)(C).The commissioner may audit and monitor the implementation of the regulations and the requirements of this chapter with respect to using agencies. (b)The commissioner shall adopt regulations pertaining to (1)suspension,debarment,and reinstatement of prospective bidders and contractors; (2)bid protests; (3)conditions and procedures for the procurement of perishables and items for resale; (4)conditions and procedures for the use of source selection methods authorized by this chapter,including single source procurements,emergency procurements,and small procurements; (5)the opening or rejection of bids and offers,and waiver of informalities in bids and offers; Exhibit S-3 Page 5 of 57 (6)confidentiality of technical data and trade secrets submitted by actual or prospective bidders or offerors; (7)partial,progressive,and multiple awards; (8)storerooms and inventories,including determination of appropriate stock levels and the management of agency supplies; (9)transfer,sale,or other disposal of supplies; (10)definitions and classes of contractual services and procedures for acquiring them; (11)providing for conducting price analysis; (12)use of payment and performance bonds in connection with contracts for supplies,services, and construction; (13)guidelines for use of cost principles in negotiations,adjustments,and settlements; (14)conditions under which an agency may use the services of an employment program; (15)a bidder's or offeror's duties under this chapter;and (16)the elimination and prevention of discrimination in state contracting because of race, religion,color,national origin,sex,age,marital status,pregnancy,parenthood,disability,or political affiliation. Sec.36.30.050.Lists of contractors.[Repealed,Sec.26 ch 59 SLA 2013]. Repealed or Renumbered Sec.36.30.060.Specifications. (a)The commissioner shall adopt regulations governing the preparation,revision,and content of specifications for supplies,services,professional services,and construction required by an agency.The commissioner shall monitor the use of these specifications. (b)Specifications for construction of highways must conform as closely as practicable to those adopted by the American Association of State Highway and Transportation Officials. (c)The commissioner may obtain expert advice and assistance from personne!of using agencies in the development of specifications.Specifications must promote overall economy for the purposes intended and encourage competition in satisfying the state's needs,and may not be unduly restrictive. The requirements ofthis subsection regarding the purposes and nonrestrictiveness of specifications apply to all specifications,including those prepared by architects,engineers,designers,and other professionals. Exhibit S-3 Page 6 of 57 (d)In this section,"specification"means a description of the physical or functional characteristics,or of the nature of a supply,service,professional service,or construction project;it may include requirements for licensing,inspecting,testing,and delivery. Sec.36.30.070.Supply management. The commissioner shall adopt regulations governing the (1)management of supplies during their entire life cycle; (2)sale,lease,or disposal of surplus supplies by public auction,competitive sealed bidding,or other appropriate method; (3)purchase of surplus supplies by an employee ofthe using or disposing agency;and (4)transfer of excess supplies. Sec.36.30.080.Leases. (a)The department shall lease space for the use of the state or an agency wherever it is necessary and feasible,subject to compliance with the requirements of this chapter.A lease may not provide for a period of occupancy greater than 40 years.An agency requiring office,warehouse,or other space shall lease the space through the department. (b)[Repealed,Sec.11 ch 75 SLA 1994]. (c)If the department,the Board of Regents of the University of Alaska,the legislative council,or the supreme court intends to enter into or renew a lease of real property with an annual rent to the department,University of Alaska,legislative council,or supreme court that is anticipated to exceed $500,000,or with total lease payments that exceed $2,500,000 for the full term ofthe lease,including any renewal options that are defined in the lease,the department,the Board of Regents,the legislative council,or supreme court shall provide notice to the legislature.The notice must include the anticipated annual lease obligation amount and the total lease payments for the full term of the lease.The department,the Board of Regents,the legislative council,and the supreme court may not enter into or renew a lease of real property (1)requiring notice under this subsection unless the proposed lease or renewal of a lease has been approved by the legislature by law;an appropriation for the rent payable during the initial period of the lease or the initial period of lease renewal constitutes approval of the proposed lease or renewal of a lease for purposes of this paragraph; (2)under this subsection if the total of all optional renewal periods provided for in the lease exceeds the original term of the lease exclusive of the total period of all renewal options. Exhibit S-3 Page 7 of 57 (d)When the department is evaluating proposals for a lease of space,the department shall consider,in addition to lease costs,the life cycle costs,function,indoor environment,public convenience,planning,design,appearance,and location of the proposed building. (e)When the department is considering leasing space,the department should consider whether leasing is likely to be the least costly means to provide the space. (f)When the department is acquiring leased space of 7,000 square feet or less,the department may procure the leased space using the procedures for small procurements under AS 36.30.320, providing public notice is given to prospective offerors in the market area. Sec.36.30.083.Lease extensions authorized. (a)Notwithstanding any other provision of this chapter,the department,the Board of Regents of the University of Alaska,the legislative council,or the court system may extend a real property lease that is entered into under this chapter for up to 10 years if a minimum cost savings of at least 10 percent below the market rental value of the real property at the time of the extension would be achieved on the rent due under the lease.The market rental value must be established by a real estate broker's opinion of the rental value or by an appraisal of the rental value. (b)The department,the University of Alaska,the court system,and the Legislative Affairs Agency shall submit individually an annual report to the Legislative Budget and Audit Committee detailing the leases extended and the cost savings achieved by that entity under (a)of this section.The reports are due August 31 of each year. Sec.36.30.085.Lease-purchase agreements. (a)To perform its duties and statutory functions,the department,the Board of Regents of the University of Alaska,the legislative council,or the supreme court may enter into lease-purchase agreements for real property.The department,the Board of Regents,the legislative council,or the supreme court may enter into a lease-purchase agreement only if the department,the Board of Regents,the legislative council,or the supreme court is the lessee under the agreement. (b)When evaluating proposals to acquire or improve real property under a lease-purchase agreement,the department,the Board of Regents,the legislative council,or the supreme court shall consider (1)in addition to lease costs,the life cycle costs,function,indoor environment,public convenience,planning,design,appearance,and location of the real property proposed for acquisition or improvement;and (2)whether acquisition or improvement of the real property by lease-purchase agreement is likely to be the least costly means to provide the space. (c)A lease-purchase agreement Exhibit S-3 Page 8 of 57 (1)may not provide for a period of occupancy under the full term of the lease-purchase agreement that is greater than 40 years; (2)must provide that lease payments made by the department,the Board of Regents,the legislative council,or the supreme court are subject to annual appropriation. (d)If the department,Board of Regents,legislative council,or supreme court intends to enter into or renew a Jease-purchase agreement for real property,the department,Board of Regents, legislative council,or supreme court shall provide notice to the legislature.The notice must include the (1)anticipated total construction,acquisition,or other costs of the project; (2)anticipated annual amount of the rental obligation;and (3}total lease payments for the full term of the lease-purchase agreement. (e)The department,the Board of Regents,the legislative council,or the supreme court may not enter into a lease-purchase agreement to acquire or improve real property unless the agreement has been approved by the legislature by law. (f)The provisions of (d)and (e)of this section do not apply to a lease-purchase agreement (1)related to the refinancing of an outstanding balance owing on an existing lease-purchase agreement;or (2)by the University of Alaska if the lease-purchase agreement is secured by student fees or university receipts as defined in AS 14.40.491. (g)In this section, (1)"full term of the lease-purchase agreement"includes all renewal options that are defined within the lease-purchase agreement; (2)"lease-purchase agreement"includes a lease-financing agreement. Sec.36.30.086.Lease-purchase of personal property. (a)To perform its duties and statutory functions,an agency,the Board of Regents of the University of Alaska,the legislative council,the Legislative Budget and Audit Committee,the office of victims'rights,the office of the ombudsman,or the supreme court may enter into lease-purchase agreements for the acquisition of equipment or other personal property.The government entity is the lessee under the agreement. (b)If a government entity enters into a lease-purchase agreement under (a)of this section that exceeds $100,000 in payments by the state,the government entity shall provide notice to the presiding officers and finance committee chairs of the house and senate.The notice must describe the property that is the subject of the agreement and must set out the terms of the lease-purchase. Exhibit S-3 Page 9 of 57 Sec.36.30.090.Delivery of supplies.[Repealed,Sec.48 ch 137 SLA 1996]. Repealed or Renumbered Sec.36.30.095.Procurement of paper.[Repealed,Sec.48 ch 137 SLA 1996]. Repealed or Renumbered Article 02.COMPETITIVE SEALED BIDDING Sec.36.30.100.General policy. (a)Except as otherwise provided in this chapter,or unless specifically exempted by law,an agency contract shall be awarded by competitive sealed bidding. (b)[Repealed,Sec.48 ch 137 SLA 1996]. (c)[Repealed,Sec.20 ch 102 SLA 1989]. Sec.36.30.110.Invitation to bid. (a)When competitive sealed bidding is used,the procurement officer shall issue an invitation to bid.It must include a time,place,and date by which the bid must be received,purchase description,and a description of all contractual terms and conditions applicable to the procurement. (b)The bidder shall have a valid Alaska business license at the time the contract is awarded.To qualify as an Alaska bidder under AS 36.30.321,a bidder shall have a valid Alaska business license at the time designated in the invitation to bid for bid opening.A bidder for a construction contract shall also submit proof of the bidder's registration under AS 08.18 before the contract may be awarded. (c)If the commissioner of transportation and public facilities makes a written finding that the release of the estimated cost of a construction contract would adversely affect the state's ability to obtain the best competitive bid,the estimated cost is confidential information and may not be released to the public before bid opening. Sec.36.30.115.Subcontractors for construction contracts. (a)Within five working days after the identification of the apparent low bidder for a construction contract,the apparent low bidder shall submit a list of the subcontractors the bidder proposes to use in the performance of the construction contract.The list must include the name and location of the place of business for each subcontractor,evidence of each subcontractor's valid Alaska business license,and evidence of each subcontractor's registration as a contractor under AS 08.18.Ifa subcontractor on the list did not have a valid Alaska business license and a valid certificate of registration as a contractor under AS 08.18 at the time the bid was opened,the bidder may not use the subcontractor in the performance of the contract,and shall replace the subcontractor with a subcontractor who had a valid Alaska business license and a valid certificate of registration as a contractor under AS 08.18 at the time the bid was opened. Exhibit S-3 Page 10 of 57 (b)A construction contractor or the apparent low bidder for a construction contract may replace a listed subcontractor if the subcontractor (1)fails to comply with AS 08.18; (2)files for bankruptcy or becomes insolvent; (3)fails to execute a contract with the construction contractor or bidder involving performance of the work for which the subcontractor was listed and the construction contractor or bidder acted in good faith; (4)fails to obtain bonding; (5)fails to obtain insurance acceptable to the state; (6)fails to perform the contract with the construction contractor or bidder involving work for which the subcontractor was listed; (7)must be substituted in order for the contractor to satisfy required state and federal affirmative action requirements; (8)refuses to agree or abide with the labor agreement of the construction contractor or bidder; or (9)is determined by the procurement officer not to be a responsible subcontractor. (c)If a bidder for a construction contract fails to list a subcontractor or lists more than one subcontractor for the same portion of work and the value ofthat work is in excess of half of one percent of the total bid,the bidder shall be considered to have agreed to perform that portion of work without the use of a subcontractor and to have represented the bidder to be qualified to perform that work. (d)A bidder for a construction contract who attempts to circumvent the requirements of this section by listing as a subcontractor another contractor who,in turn,sublets the majority of the work required under the contract violates this section. (e)If a construction contract is awarded to a bidder who violates this section,the procurement officer may (1)cancel the contract;or (2)after notice and a hearing,assess a penalty on the bidder in an amount that does not exceed 10 percent of the value of the subcontract at issue. (f)In addition to the circumstances described in (b)of this section,a construction contractor may request permission from the procurement officer to add or replace a listed subcontractor.The request must be in writing,specifically detailing the basis for the request,and include appropriate supporting documentation.The procurement officer shall approve the request if the procurement Exhibit S-3 Page 11 of 57 officer determines in writing that the requested addition or replacement is in the best interest of the state. (g)The requirements ofthis section do not apply to a design-build construction contract. (h)In this section,"construction contractor"means a person who enters into a construction contract with an agency. Sec.36.30.120.Bid security. (a)Bid security shall be required for all competitive sealed bidding for construction contracts when the price is estimated by the procurement officer to exceed an amount established by regulation of the commissioner.Bid security on construction contracts under the amount set by the commissioner may be required when the circumstances warrant.Bid security may be required for competitive sealed bidding for contracts for supplies,services,or professional services in accordance with regulations of the commissioner when needed for the protection of the state. (b)Bid security must be a bond provided by a surety company authorized to do business in the state or otherwise supplied in a form satisfactory to the commissioner.Bid security must be in an amount equal to at least five percent of the amount ofthe bid. (c})When the invitation to bid requires security,the procurement officer shall reject a bid that does not comply with the bid security requirement unless,in accordance with regulations,the officer determines that the bid fails to comply in a nonsubstantial manner with the security requirements. Sec.36.30.130.Public notice of invitation to bid. (a)The procurement officer shall give adequate public notice of the invitation to bid at least 21 days before the date for the opening of bids.If the procurement officer determines in writing that a shorter notice period is advantageous for a particular bid and adequate competition is anticipated,the 21-day period may be shortened.Notice shall be posted on the Alaska Online Public Notice System (AS 44.62.175).The time and manner of notice must be in accordance with regulations adopted by the commissioner of administration.When practicable,notice may include (1)publication in a newspaper calculated to reach prospective bidders;and (2)notices posted in public places within the area where the work is to be performed or the material furnished. (b)Failure to comply with the notice requirements of this section does not invalidate a bid or the award of a contract.If the state fails to substantially comply with the requirements of (a)ofthis section,the state is liable for damages caused by that failure. Exhibit S-3 Page 12 of $7 Sec.36.30.140.Bid opening. (a)The procurement officer shall open bids at the time and place designated in the invitation to bid.All bid openings are open to the public.The amount of each bid and other relevant information that is specified by regulation of the commissioner,together with the name of each bidder,shall be recorded. (b)The information recorded under (a)of this section is open to public inspection as soon as practicable before the notice of intent to award a contract is given under AS 36.30.365.The bids are not open for public inspection until after the notice of intent to award a contract is given.To the extent the bidder designates and the procurement officer concurs,trade secrets and other proprietary data contained in a bid document are confidential. Sec.36.30.150.Bid acceptance and bid evaluation. (a)Bids shall be unconditionally accepted without alteration or correction,except as authorized in AS 36.30.160.The procurement officer shall evaluate bids based on the requirements set out in the invitation to bid,which may include criteria to determine acceptability such as inspection,testing, quality,delivery,and suitability for a particular purpose.The criteria that will affect the bid price and be considered in evaluation for award must be objectively measurable,such as discounts,transportation costs,and total or life cycle costs.The invitation to bid must set out the evaluation criteria to be used. Criteria may not be used in bid evaluation if they are not set out in the invitation to bid. (b)[Repealed,Sec.11 ch 37 SLA 1993]. Sec.36.30.160.Late bids;correction or withdrawal of bids;cancellation of awards. (a)Bids received after the bid due date and time indicated on the invitation to bid may not be accepted unless the delay was due to an error of the contracting agency. (b)Correction or withdrawal of inadvertently erroneous bids before or after bid opening,or cancellation of awards or contracts based on bid mistakes may be permitted in accordance with regulations adopted by the commissioner.After bid opening,changes in bid prices or other provisions of bids prejudicial to the interest of the state or fair competition may not be permitted.Except as otherwise provided by regulation,a decision to permit the correction or withdrawal of a bid,or to cancel an award or contract based on bid mistake,shall be supported by a written determination made by the procurement officer.If a bidder is permitted to withdraw a bid before award,an action may not be maintained against the bidder or the bid security. Sec.36.30.170.Contract award after bids. After applying any preferences that apply under AS 36.15.050 and AS 36.30.321 -36.30.338,a procurement officer shall award a contract based on the solicited bids with reasonable promptness by written notice to the lowest responsible and responsive bidder whose bid conforms in all material respects to the requirements and criteria set out in the invitation to bid. Exhibit S-3 Page 13 of 57 Sec.36.30.175.Alaska veterans'preference.[Repealed,Sec.26 ch 59 SLA 2013.For current law,see AS 36.30.321]. Repealed or Renumbered Sec.36.30.180.Purpose. The legislature finds that there exists in the state continuing high unemployment,underutilization of resident construction and supply firms,and high costs unfavorable to the welfare of Alaskans and to the economic health of the state.The purpose of bidder preference for resident firms when the state acts as a market participant is to encourage local industry,strengthen and stabilize the economy,decrease unemployment,and strengthen the tax and revenue base of the state. Sec.36.30.190.Multi-step sealed bidding. When it is considered impractical to initially prepare a definitive purchase description to support an award based on price,the procurement officer may issue an invitation to bid requesting the submission of unpriced technical offers to be followed by an invitation to bid limited to the bidders whose offers are determined to be technically qualified under the criteria set out in the first solicitation. Article 03.COMPETITIVE SEALED PROPOSALS Sec.36.30.200.Conditions for use. (a)Except as otherwise provided in this chapter,or unless specifically exempted by law,an agency contract shall be awarded by competitive sealed proposals if it is not awarded by competitive sealed bidding. (b)The commissioner may provide by regulation that it is either not practicable or not advantageous to the state to procure specified types of supplies,services,or construction by competitive sealed bidding that would otherwise be procured by that method.When the procurement officer determines in writing with particularity that the use of competitive sealed proposals is more advantageous to the state than competitive sealed bidding,a contract may be entered into by competitive sealed proposals. (c)When the commissioner of transportation and public facilities determines that it is advantageous to the state,a procurement officer may issue a request for proposals requesting the submission of offers to provide construction in accordance with a design provided by the offeror.The request for proposals must require that each proposal submitted contain a single price that includes the design-build. Sec.36.30.210.Request for proposals. (a)A request for competitive sealed proposals must contain the date,time,and place for delivering proposals,a specific description of the supplies,construction,services,or professional Exhibit S-3 Page 14 of 57 services to be provided under the contract,and the terms under which the supplies,construction, services,or professional services are to be provided. (b)An offeror for a construction contract shall submit proof of the offeror's registration as a contractor under AS 08.18 before the contract may be awarded.A request for sealed proposals for a construction contract,except a design-build construction contract,must require the offeror,not later than five working days after the proposal that is the most advantageous to the state is identified,to list subcontractors the offeror proposes to use in the performance of the construction contract.The list must include the information required under AS 36.30.115(a).The provisions of AS 36.30.115(b)-(g) that apply to a construction contractor or an apparent low bidder apply to offerors submitting competitive sealed proposals for construction contracts,except design-build construction contracts. (c)A request for proposals must contain that information necessary for an offeror to submit a proposal or contain references to any information that cannot reasonably be included with the request. The request must provide a description of the factors that will be considered by the procurement officer when evaluating the proposals received,including the relative importance of price and other evaluation factors. (d)Notice of a request for proposals shall be given in accordance with procedures under AS 36.30.130.The procurement officer may use additional means considered appropriate to notify prospective offerors of the intent to enter into a contract through competitive sealed proposals. (e)The offeror shall have a valid Alaska business license at the time the contract is awarded.To qualify as an Alaska bidder under AS 36.30.321,an offeror shall have a valid Alaska business license at the time designated in the request for proposals for opening of the proposals. (f)In this section,"construction contractor"has the meaning given in AS 36.30.115. Sec.36.30.220.Standard overhead rate. (a)An agency that provides services to another agency under a contract covered by this chapter shall establish a standard overhead rate.If an agency submits a proposal in response to a request for competitive sealed proposals,the agency must include its standard overhead rate within its proposal. (b)In this section,"standard overhead rate"means a charge established for services and professional services from an agency that is designed to compensate the agency for administration and support services incidentally provided with the services contracted for. Sec.36.30.230.Disclosure of proposals;return of proposals. (a)The procurement officer shall open proposals so as to avoid disclosure of contents to competing offerors before notice of intent to award a contract is issued.A register of proposals containing the name and address of each offeror shall be prepared in accordance with regulations adopted by the commissioner.The register and the proposals are open for public inspection after the notice of intent to award a contract is issued under AS 36.30.365.To the extent that the offeror Exhibit S-3 Page 15 of 57 designates and the procurement officer concurs,trade secrets and other proprietary data contained in the proposal documents are confidential. (b}If a solicitation is cancelled under AS 36.30.350 after proposals are received but before a notice of intent to award a contract has been issued under AS 36.30.365,a protest of the solicitation or of the cancellation of the solicitation has not been filed by an interested party under AS 36.30.560,and the time specified in AS 36.30.565(a)for filing such a protest has expired,the procurement officer may return a proposal to the offeror that made the proposal.The procurement officer shall keep a list of returned proposals in the file for the solicitation. Sec.36.30.240.Discussion with responsible offerors and revisions to proposals. As provided in the request for proposals,and under regulations adopted by the commissioner, discussions may be conducted with responsible offerors who submit proposals determined to be reasonably susceptible of being selected for award for the purpose of clarification to assure full understanding of,and responsiveness to,the solicitation requirements.Offerors reasonably susceptible of being selected for award shall be accorded fair and equal treatment with respect to any opportunity for discussion and revision of proposals,and revisions may be permitted after submissions and before the award of the contract for the purpose of obtaining best and final offers.In conducting discussions, the procurement officer may not disclose information derived from proposals submitted by competing offerors.AS 44.62.310 does not apply to meetings with offerors under this section. Sec.36.30.250.Award of contract. (a)The procurement officer shall award a contract under competitive sealed proposals to the responsible and responsive offeror whose proposal is determined in writing to be the most advantageous to the state taking into consideration price and the evaluation factors set out in the request for proposals.Other factors and criteria may not be used in the evaluation.The contract file must contain the basis on which the award is made. (b)[Repealed,Sec.26 ch 59 SLA 2013]. Sec.36.30.260.Contract contents. A contract awarded under competitive sealed proposals must contain (1)a statement of the amount of the contract; (2)the date for the supplies to be delivered or the dates for construction,services,or professional services to begin and be completed; (3)a description of the supplies,construction,services,or professional services to be provided; and Exhibit S-3 Page 16 of 57 (4)certification by the project director for the contracting agency,the head of the contracting agency,or a designee that sufficient money is available in an appropriation to be encumbered for the amount of the contract. Sec.36.30.265.Multi-step sealed proposals. When it is considered impractical to initially prepare a definitive purchase description to support an award based on listed selection criteria,the procurement officer may issue an expression of interest requesting the submission of unpriced technical offers,and then later issue a request for proposals limited to the offerors whose offers are determined to be technically qualified under the criteria set out in the expression of interest. Sec.36.30.270.Architectural,engineering,and land surveying contracts. (a)Notwithstanding conflicting provisions of AS 36.30.100 -36.30.260,a procurement officer shall negotiate a contract for an agency with the most qualified and suitable firm or person of demonstrated competence for architectural,engineering,or land surveying services.The procurement officer shall award a contract for those services at fair and reasonable compensation as determined by the procurement officer,after consideration of the estimated value of the services to be rendered,and the scope,complexity,and professional nature of the services.When determining the most qualified and suitable firm or person,the procurement officer shall consider the (1)proximity to the project site of the office of the firm or person unless federal law prohibits this factor from being considered in the awarding of the contract;and (2)employment practices of the firm or person with regard to women and minorities. (b)If negotiations with the most qualified and suitable firm or person under (a)of this section are not successful,the procurement officer shall negotiate a contract with other qualified firms or persons of demonstrated competence,in order of public ranking.The procurement officer may reject all or part ofa proposal. (c)This section does not apply to contracts awarded in a situation of public necessity if the procurement officer certifies in writing that a situation of public necessity exists. (d)Notwithstanding the other provisions of this section,a procurement officer may include price as an added factor in selecting architectural,engineering,and land surveying services when,in the judgment of the procurement officer,the services required are repetitious in nature,and the scope, nature,and amount of services required are thoroughly defined by measurable and objective standards to reasonably enable firms or persons making proposals to compete with a clear understanding and interpretation of the services required.In order to include price as a factor in selection,a majority of the persons involved by the procurement officer in evaluation of the proposals must be registered in the state to perform architectural,engineering,or land surveying services. Exhibit S-3 Page 17 of 57 (e)This section does not apply to a contract that incorporates both design services and construction. Article 04.OTHER PROCUREMENT METHODS Sec.36.30.290.Electronic bids and proposals. An agency may allow bids or proposals to be submitted in electronic form under AS 09.80 (Uniform Electronic Transactions Act). Sec.36.30.300.Single source procurements. (a)A contract may be awarded for supplies,services,professional services,or construction without competitive sealed bidding,competitive sealed proposals,or other competition in accordance with regulations adopted by the commissioner.A contract may be awarded under this section only when the chief procurement officer or,for construction contracts or procurements for the state equipment fleet,the commissioner of transportation and public facilities determines in writing that (1)it is not practicable to award a contract by competitive sealed bidding under AS 36.30.100, competitive sealed proposals under AS 36.30.200,or limited competition under AS 36.30.305;and (2)award of the contract under this section is in the state's best interest. (b)The using agency shall submit written evidence to support a request for a single source procurement.The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,may also require the submission of cost or pricing data in connection with an award under this section. (c)To the extent practicable,the procurement officer shall negotiate with the single source to obtain contract terms advantageous to the state. (d)Procurement requirements may not be aggregated or structured so as to constitute a purchase under this section or to circumvent the source selection procedures required by AS 36.30.100 - 36.30.270. (e)Except for procurements of supplies,services,professional services,or construction that do not exceed the amount for small procurements under AS 36.30.320(a)as applicable,the authority to make a determination required by this section may not be delegated,even if the authority to contract is delegated under AS 36.30.015(a)and (b). Sec.36.30.305.Limited competition procurements. (a)A construction contract under $100,000,or a contract for supplies,services,or professional services,may be awarded without competitive sealed bidding or competitive sealed proposals,in accordance with regulations adopted by the commissioner.A contract may be awarded under this section only when the chief procurement officer determines in writing that a situation exists that makes Exhibit S-3 Page 18 of 57 competitive sealed bidding or competitive sealed proposals impractical or contrary to the public interest,except that the attorney general,the public defender,or the director of the office of public advocacy as provided in AS 36.30.015(k)may make the determination for services of legal counsel,and the commissioner of transportation and public facilities may make the determination for construction contracts under $100,000 or procurements for the state equipment fleet.Procurements under this section shall be made with competition that is practicable under the circumstance.Except for procurements of supplies,services,professional services,or construction that do not exceed the amount for small procurements under AS 36.30.320(a),as applicable,the authority to make a determination required by this section may not be delegated. (b)The using agency shall submit written evidence to support a determination under this section. (c)Procurement requirements may not be artificially divided,fragmented,aggregated,or structured so as to constitute a purchase under this section or to circumvent the source selection procedures required by AS 36.30.100 -36.30.270. (d)Single source procurements may not be made under this section. (e)Architectural,engineering,and land survey contracts under AS 36.30.270 may not be made under this section. Sec.36.30.308.Innovative procurements. (a)A contract may be awarded for supplies,services,professional services,or construction using an innovative procurement process,with or without competitive sealed bidding or competitive sealed proposals,in accordance with regulations adopted by the commissioner.A contract may be awarded under this section only when the chief procurement officer,or,for construction contracts or procurements ofthe state equipment fleet,the commissioner of transportation and public facilities, determines in writing that it is advantageous to the state to use an innovative competitive procurement process in the procurement of new or unique requirements of the state,new technologies,or to achieve best value. (b)The procurement officer shall submit a procurement plan to the Department of Law for review and approval as to form before issuing the notice required by (c)of this section. (c)A procurement under this section is subject to the requirements of AS 36.30.130. (d)Nothing in this section precludes the adoption of regulations providing for the use of bonuses instead of preferences in a procurement of construction. Sec.36.30.310.Emergency procurements. Procurements may be made under emergency conditions as defined in regulations adopted by the commissioner when there exists a threat to public health,welfare,or safety,when a situation exists that Exhibit S-3 Page 19 of 57 makes a procurement through competitive sealed bidding or competitive sealed proposals impracticable or contrary to the public interest,or to protect public or private property.An emergency procurement need not be made through competitive sealed bidding or competitive sealed proposals but shall be made with competition that is practicable under the circumstances.A written determination by the chief procurement officer of the basis for the emergency and for the selection of the particular contractor shall be included in the contract file.The written determination must include findings of fact that support the determination.Except when there is insufficient time for the chief procurement officer to make the written determination required by this section,the chief procurement officer may not delegate the authority to make the determination. Sec.36.30.311.Employment and youth program procurements. A procurement of products manufactured or services provided by an employment program of the state or an accredited youth education and employment program may be made without competitive sealed bidding or competitive sealed proposals,in accordance with regulations adopted by the commissioner. Sec.36.30.313.Procurements provided through employment of prison inmates. A procurement of products or services provided through the employment of prison inmates under AS 33.30.191 may be made without competitive sealed bidding or competitive sealed proposals,in accordance with regulations adopted by the commissioner. Sec.36.30.315.Determinations;false statements;criminal penalty. (a)In a determination made bya state official under AS 36.30.300 -36.30.310,the state official making the determination shall independently examine the material facts of the procurement and independently determine whether the procurement is eligible for the procurement method requested. (b)If a state official knowingly makes a false statement in a determination made under AS 36.30.300 -36.30.310,the state official is guilty of a class A misdemeanor. Sec.36.30.320.Small procurements. (a)A procurement for supplies,services,or professional services that does not exceed an aggregate dollar amount of $100,000,construction that does not exceed an aggregate dollar amount of $200,000,or lease of space that does not exceed 7,000 square feet shall be made under regulations adopted by the commissioner for small procurements. (b)[Repealed,Sec.48 ch 137 SLA 1996]. (c)Small procurements need not be made through competitive sealed bidding or competitive sealed proposals but shall be made with competition that is practicable under the circumstances. (d)Procurement requirements may not be artificially divided or fragmented so as to constitute a purchase under this section or to circumvent the source selection procedures required by AS 36.30.100 - 36.30.270. Exhibit S-3 Page 20 of 57 (e)The procurement officer shall give adequate public notice of intent to make a procurement under this section in accordance with regulations adopted by the commissioner. Article 05.PREFERENCES Sec.36.30.321.Alaska bidder and related preferences. (a)If the bidder or offeror is an Alaska bidder,a five percent preference shall be applied to the price in the bid or proposal. (b)Except as otherwise provided in (d),(e),or (g)of this section,if a bidder or offeror qualifies as an Alaska bidder and is offering services through an employment program,a 15 percent preference shall be applied to the price in the bid or proposal. (c)lf a bidder or offeror qualifies as an Alaska bidder and is an Alaska domestic insurer,and if the procurement is for an insurance-related contract,a five percent preference shall be applied to the price in the bid or proposal. {d)A 10 percent preference shall be applied to a price in a bid or proposal if the bidder or offeror qualifies as an Alaska bidder and is a (1)sole proprietorship owned by a person with a disability; (2)partnership under AS 32.06 or AS 32.11 if each of the partners is a person with a disability; (3)limited liability company organized under AS 10.50 if each of the members is a person witha disability; (4)corporation that is wholly owned by individuals,and each of the individuals is a person with a disability;or (5)joint venture that is composed of ventures that qualify under (1)-(4)of this subsection. (e)The division of vocational rehabilitation in the Department of Labor and Workforce Development shall add to its current list of qualified employment programs a list of individuals who qualify as persons with a disability under (d)of this section.To qualify for a preference under (d)of this section,a person must be on the list at the time the bid or proposal is opened. (f)lf a bidder or offeror qualifies as an Alaska bidder and is a qualifying entity,a five percent preference shall be applied to the price in the bid or proposal.The preference may not exceed $5,000.In this subsection, (1)"Alaska veteran"means an individual who is both a resident of the state and a veteran; (2)"qualifying entity"means a (A)sole proprietorship owned by an Alaska veteran; Exhibit S-3 Page 21 of 57 (B)partnership under AS 32.06 or AS 32.11 if a majority of the partners are Alaska veterans; (C)limited liability company organized under AS 10.50 if a majority of the members are Alaska veterans;or {D)corporation that is wholly owned by individuals,and a majority of the individuals are Alaska veterans; (3)"veteran"means an individual who (A)served in the (i)armed forces of the United States,including a reserve unit of the United States armed forces; or (ii)Alaska Territorial Guard,the Alaska Army National Guard,the Alaska Air National Guard,or the Alaska Naval Militia;and (B)was separated from service under a condition that was not dishonorable. (g)A bidder or offeror may not receive a preference under both (b)and (d)ofthis section for the same contract. (h)Except as provided by (j)of this section,this section applies to all insurance contracts involving state money.In this subsection,"state money"has the meaning given in AS 36.30.990,but also includes state grants and reimbursements to municipalities,school districts,and other entities. (i)To qualify for a preference under (b),(d),or (f)of this section,a bidder or offeror must add value by actually performing,controlling,managing,and supervising the services provided,or the bidder or offeror must have sold supplies of the general nature solicited to other state agencies,other governments,or the general public. (j)This section does not apply to solicitations or contracts for lease space under AS 36.30.080,to procurements under AS 36.30.305 -36.30.310 or,except as provided otherwise by regulation under AS 36.30.320,to small procurements under AS 36.30.320. (k)In this section,"person with a disability"means an individual who (1)has been determined to be permanently disabled by the (A)United States Social Security Administration under 42 U.S.C.423 or 1381 -1383f (Social Security Act); (B)teachers'retirement system under AS 14.25,the judicial retirement system under AS 22.25, the public employees'retirement system under AS 39.35,or the elected public officers'retirement system under former AS 39.37; Exhibit S-3 Page 22 of 57 (C)Federal Civil Service Retirement System under S U.S.C.2107,3323,and 8331 -8351; (D)federal employees'retirement system under 5 U.S.C.8401 -8480;or (E)division of vocational rehabilitation in the Department of Labor and Workforce Development using disability standards under 42 U.S.C.1381 -1383f (Social Security Act)for eligibility for certain state disability programs; (2)is receiving permanent total disability under AS 23.30 (Alaska Workers'Compensation Act); (3)has been discharged from military service under honorable conditions and is certified by the United States Department of Veterans Affairs as having incurred a 50 percent or greater disability during military service;or (4)has served in the Alaska Territorial Guard and incurred a 50 percent or greater disability while serving in the Alaska Territorial Guard. Sec.36.30.322.Use of local forest products. (a)Only timber,lumber,and manufactured lumber products originating in this state from Alaska forests may be procured by an agency or used in construction projects of an agency unless (1)the manufacturers and suppliers who have notified the commissioner of commerce, community,and economic development of their willingness to manufacture or supply Alaska forest products have been given reasonable notice of the forest product needs of the procurement or project; and (2)a manufacturer or supplier who has notified the commissioner of commerce,community, and economic development of its willingness to manufacture or supply Alaska forest products is not the low bidder after all applicable preferences have been applied to the price of the qualifying forest product under AS 36.30.336. (b}The provisions of AS 36.30.326 -36.30.332 do not apply to procurements oftimber,lumber, and manufactured lumber products or the use of those items in construction projects of an agency. (c)During the period of performance of a state contract,the contractor shall maintain records showing efforts made in using Alaska forest products or evidence of Alaska forest products not being available or reasonably competitive.The contractor shall provide the records to the procurement officer on a periodic basis,as required by regulations adopted by the commissioner of commerce,community, and economic development. Sec.36.30.324.Use of Alaska products and recycled Alaska products. Alaska products shall be used whenever practicable in procurements for an agency.Recycled Alaska products shall be used when they are of comparable quality,of equivalent price,and appropriate for the intended use. Exhibit S-3 Page 23 of 57 Sec.36.30.326.Contract specifications. Contract specifications for a procurement for an agency must include a provision that a bidder or offeror that designates in a bid or proposal the use of Alaska products identified in the specifications will receive the preference granted under AS 36.30.328 in the evaluation of the bid or proposal if the designated Alaska products meet the contract specifications. Sec.36.30.328.Grant of Alaska products preference. In the evaluation of a bid or proposal for a procurement for an agency,a bid or offer that designates the use of Alaska products identified in the contract specifications and designated as Class I,Class Il,or Class Ill state products under AS 36.30.332 is decreased by the percentage of the value of the designated Alaska products under AS 36.30.332. Sec.36.30.330.Penalty for failing to use designated products. (a)If a successful bidder or offeror who designates the use of an Alaska product in a bid or proposal for a procurement for an agency fails to use the designated product for a reason within the control of the successful bidder or offeror,each payment under the contract shall be reduced according to the following schedule: (1)for a Class |designated Alaska product -four percent; (2)for a Class Il designated Alaska product -six percent; (3)for a Class Ill designated Alaska product -eight percent. (b)A person is not a responsible bidder or offeror if,in the preceding three years,the person has twice designated the use of an Alaska product in a bid or proposal for a procurement for an agency and has each time failed to use the designated Alaska product for reasons within the control of the bidder or offeror. (c)The procurement officer shall report to the commissioner of commerce,community,and economic development each contractor penalized under (a)of this section.The commissioner of commerce,community,and economic development shall maintain a list of contractors determined not to be responsible bidders under (b)of this section. Sec.36.30.331.Delivery of supplies. Supplies purchased under this chapter shall be delivered at a location within the state unless the department determines that a point of delivery outside the state would be in the best interest of the state.A bid or proposal involving the procurement of supplies must specify the delivery location and must state that the price is the delivered price at that location. Exhibit S-3 Page 24 of 57 Sec.36.30.332.Classification of Alaska products. (a)The commissioner of commerce,community,and economic development shall adopt regulations establishing the value added in the state for materials and supplies produced or manufactured in the state that are used in a state procurement and establishing whether a product qualifies as a recycled Alaska product.The commissioner shall publish a list of the products annually.A supplier may request inclusion of its product on the appropriate list. (b)Materials and supplies with value added in the state that are (1)more than 25 percent and less than 50 percent produced or manufactured in the state are Class |products; (2)50 percent or more and less than 75 percent produced or manufactured in the state are Class II products;and (3)75 percent or more produced or manufactured in the state are Class III products. (c}In a bid or proposal evaluation a (1)Class |product is given a three percent preference; (2)Class I product is given a five percent preference; (3)Class III product is given a seven percent preference. Sec.36.30.333.Procurement of paper. Except as otherwise required under AS 36.15.050,AS 36.30.322 -36.30.332,and 36.30.334 -36.30.338, when a state agency purchases paper,at least 25 percent of the quantity purchased must be recycled paper unless recycled paper is not available for the purchase or unless,after application of the procurement preference under AS 36.30.337,the recycled paper is more expensive than the nonrecycled paper. Sec.36.30.334.Identification of Alaska products. An agency may identify specific Alaska products for use in making a procurement. Sec.36.30.335.Relationship to other product preferences.[Repealed,Sec.26 ch 59 SLA 2013]. Repealed or Renumbered Sec.36.30.336.Application of preferences. (a)Except as provided in AS 36.15.050(g)and AS 36.30.321(g),the preferences provided in AS 36.15.050 and AS 36.30.321 -36.30.338 are cumulative.A bidder who would otherwise qualify for preferences under AS 36.30.321 may not be given a preference over another bidder who qualifies for the same preferences. Exhibit S-3 Page 25 of 57 (b)Notwithstanding the other provisions of this chapter,AS 36.30.321 -36.30.338 apply to all procurements subject to this chapter,except as provided in AS 36.15.050(h)and AS 36.30.322(b). Sec.36.30.337.Procurement preference for recycled products. (a)In the evaluation of a bid or proposal for an agency procurement of products,the agency shall decrease the bid or proposal by five percent if the bid or proposal indicates that the products being purchased will be recycled products. (b)A decrease made under (a)of this section is in addition to other preferences allowed for the procurement. (c)The department shall establish the minimum percentage of recycled content that will qualify a product as a recycled product under (a)ofthis section. Sec.36.30.338.Definitions. In AS 36.30.322 -36.30.338, (1)"Alaska product”means a product of which not less than 25 percent ofthe value,as determined in accordance with regulations adopted under AS 36.30.332(a),has been added by manufacturing or production in the state; (2)"produced or manufactured"means processing,developing,or making an item into a new item with a distinct character and use through the application within the state of materials,labor,skill, or other services; (3)"product"means materials or supplies but does not include gravel and asphalt; (4)"recycled Alaska product”means an Alaska product of which not less than 50 percent of the value of the product consists of a product that was previously used in another product,if the recycling process is done in the state. Sec.36.30.339.[Renumbered as AS 36.30.337]. Repealed or Renumbered Article 06.CONTRACT FORMATION AND MODIFICATION Sec.36.30.340.Review and approval by the Attorney General. If a contract contains a term that is in conflict with a state standard form contract term or if a standard term is deleted or modified by aterm that is not standard,the contract must be reviewed by the Attorney General and approved as to form. Exhibit S-3 Page 26 of 57 Sec.36.30.350.Solicitation cancellation,bid and proposal rejection,and delay of opening bid or proposal. An invitation to bid,a request for proposals,or other solicitation may be cancelled or any or all bids or proposals may be rejected in whole or in part or the date for opening bids or proposals may be delayed when it is in the best interests of the state in accordance with regulations adopted by the commissioner. The reasons for cancellation,rejection,or delay in opening bids or proposals shall be made part of the contract file. Sec.36.30.360.Determination of nonresponsibility. (a)A written determination of nonresponsibility of a bidder or offeror shall be made by the procurement officer in accordance with regulations adopted by the commissioner.The unreasonable failure of a bidder or offeror to promptly supply information in connection with an inquiry with respect to responsibility is grounds for a determination of nonresponsibility with respect to the bidder or offeror. (b)Information furnished by a bidder or offeror under (a)of this section is confidential and may not be disclosed without prior written consent by the bidder or offeror. Sec.36.30.362.Award of a contract to a nonresident. Except for awards made under AS 36.30.170,if the procurement officer awards a contract to a person who does not reside or maintain a place of business in the state and if the supplies,services, professional services,or construction that is the subject of the contract could have been obtained from sources in the state,the procurement officer shall issue a written statement explaining the basis of the award.The statement required under this section shall be kept in the contract file. Sec.36.30.365.Notice of intent to award a contract. At least 10 days before the formal award of a contract that is not for construction,and at least five days before the award of a construction contract,under this chapter,except for a contract awarded under AS 36.30.300 -36.30.320,the procurement officer shall provide to each bidder or offeror notice of intent to award a contract.The notice must conform to regulations adopted by the commissioner. Sec.36.30.370.Permissible types of contracts. Any type of contract that will promote the best interests of the state may be used,except that the use of a cost-plus-a-percentage-of-cost contract is prohibited. Sec.36.30.380.Approval of accounting system.[Repealed,Sec.24 ch 65 SLA 1987]. Repealed or Renumbered Exhibit S-3 Page 27 of 57 Sec.36.30.390.Contract term and cancellation. (a)Unless otherwise provided by law,a contract for supplies,services,or professional services may be entered into for any period of time considered to be in the best interests of the state provided the term of the contract and conditions of renewal or extension,if any,are included in the solicitation and funds are available for the first fiscal period at the time of contracting.Payment and performance obligations for succeeding fiscal periods shall be subject to the availability and appropriation of funds for them. (b)Before using a multi-term contract,the procurement officer shall determine in writing that (1)estimated requirements cover the period of the contract and are reasonably firm and continuing;and (2)the contract will serve the best interests of the state by encouraging effective competition or otherwise promoting economies in state procurement. (c)When funds are not appropriated or otherwise made available to support continuation of performance in a subsequent fiscal period,the contract shall be cancelled.The contractor may only be reimbursed for the reasonable value of any nonrecurring costs incurred but not amortized in the price of the supplies,services,or professional services delivered under the contract that are not otherwise recoverable.The cost of cancellation may be paid from any appropriations available for these purposes. Sec.36.30.400.Required cost and pricing data and contract provisions. (a)Before an award of a contract or a change order or contract modification,the contractor or prospective contractor shall submit cost and pricing data.The contractor or prospective contractor shall certify that,to the best of the contractor's or prospective contractor's knowledge and belief,the data submitted is accurate,complete,and current as of a mutually determined specified date and will continue to be accurate and complete during the performance of the contract. (b)When a contractor becomes aware of a situation that may form the basis of a claim for compensation that exceeds the amount designated as the base amount ofthe contract and before performing additional work or supplying additional materials,the contractor shall submit cost and pricing data on the additional work or materials.The contractor shall certify that,to the best of the contractor's knowledge and belief,the data submitted is accurate,complete,and current and is the actual cost to the contractor of performing the additional work or supplying the additional materials. (c)A contract,change order,or contract modification under which a certificate is required under (a)or (b)of this section must contain a provision that the price to the state,including the contractor's profit or fee,will be adjusted to exclude any significant sums by which the state finds that the price is increased because the cost or pricing data furnished by the contractor or prospective contractor is inaccurate,incomplete,or not current as of the date agreed upon by the parties. (d)The requirements of (a)of this section do not apply when Exhibit $-3 Page 28 of 57 (1)the contract price is based on adequate price competition; (2)the contract price is set by law or regulation;or (3)it is determined by the procurement officer in writing and in accordance with regulations adopted by the commissioner that the requirements of (a)of this section may be waived,and the reasons for waiver are stated. Sec.36.30.410.Right to inspect plant. The state may,at reasonable times,inspect the part of the plant or place of business of a contractor or subcontractor that is related to the performance of a contract awarded or to be awarded by an agency. Sec.36.30.420.Right to audit records. (a)The state may,at reasonable times and places,audit the books and records of a person who has submitted cost or pricing data under AS 36.30.400 to the extent that the books and records relate to the cost or pricing data.A person who receives a contract,change order,or contract modification for which cost or pricing data is required,shall maintain books and records that relate to the cost or pricing data for three years after the date of final payment under the contract,unless a shorter period is authorized in writing by the commissioner. (b)The state may audit the books and records of a contractor or a subcontractor to the extent that the books and records relate to the performance of the contract or subcontract.Books and records shall be maintained by the contractor for a period of three years after the date of final payment under the prime contract and by the subcontractor for a period of three years after the date of final payment under the subcontract,unless a shorter period is authorized in writing by the commissioner. Sec.36.30.430.Contract clauses. (a)The commissioner shall adopt regulations permitting the inclusion of clauses providing for adjustments in prices,time of performance,or other contract provisions as appropriate. (b}The commissioner shall adopt regulations permitting or requiring the inclusion in state contracts of clauses providing for appropriate remedies and covering the following subjects: (1)liquidated damages; (2)specified excuses for delay or nonperformance; (3)termination of the contract for default;and (4)termination of the contract in whole or in part for the convenience of the state. Sec.36.30.4600.Modification of standard clauses. Exhibit S-3 Page 29 of 57 The procurement officer or the head of a contracting agency may vary the clauses adopted under AS 36.30.430 for inclusion in a particular state contract if the (1)variations are supported by a written determination that states the circumstances justifying the variation;and (2)approval required by AS 36.30.340 is obtained. Sec.36.30.470.Fiscal effects of construction contract modifications. A contract modification,change order,or contract price adjustment under a construction contract in excess of an amount established by regulation of the commissioner is subject to prior written certification by the fiscal officer of the agency responsible for funding the project or the contract,or other official responsible for monitoring and reporting upon the status of the costs of the total!project budget or contract budget,as to the effect of the contract modification,change order,or adjustment in contract price on the total project budget or the total contract budget.If the certification of the fiscal officer or other responsible official discloses a resulting increase in the total project budget or the total contract budget,the procurement officer may not approve the contract modification,change order,or adjustment in contract price unless sufficient funds are available,or the scope of the project or contract is adjusted to permit the degree of completion that is feasible within the total project budget or total contract budget as it existed before the contract modification,change order,or adjustment in contract price under consideration.A contract modification,change order,or adjustment in contract that is signed by both parties and has been reasonably relied on by a contractor is presumed to be valid even if the provisions of this section have not been met. Sec.36.30.480.Establishment and modification of cost principles. The commissioner shall adopt regulations setting out cost principles that shall be used to determine the allowability of incurred costs for the purpose of reimbursing costs under contract provisions that provide for the reimbursement of costs.If a written determination is approved at a level above the procurement officer,the cost principles may be modified by contract. Article 07.PROCUREMENT RECORDS AND REPORTS Sec.36.30.500.Retention of procurement records. Procurement records shall be retained and disposed of in accordance with records retention guidelines and schedules approved by the state archivist.Retained documents shall be made available to the attorney general or a designee upon request and proper receipt. Sec.36.30.510.Records of contracts awarded under competitive sealed proposals. A contract file open for public inspection shall be kept by the commissioner and the contracting agency for each contract awarded under competitive sealed proposals.The file kept by the commissioner must Exhibit S-3 Page 30 of 57 contain a summary of the information in the file of the contracting agency.The file kept by the contracting agency must contain (1)a copy of the contract; (2)the register of proposals prepared under AS 36.30.230 and a copy of each proposal submitted;and (3)the written determination to award the contract prepared under AS 36.30.250. Sec.36.30.520.Records of single source and emergency procurements. (a)The commissioner shall maintain for a minimum of five years a record listing all single source procurement contracts made under AS 36.30.300 and emergency procurements made under AS 36.30.310.The record must contain (1)each contractor's name; (2)the amount and type of each contract;and (3)a listing of the supplies,services,professional services,or construction procured under each contract. (b)The Department of Transportation and Public Facilities and any agency to whom the commissioner of administration or the commissioner of transportation and public facilities has delegated procurement authority under AS 36.30.015 shall,by October 1 of each year,submit to the commissioner of administration records of the type specified in (a)of this section for emergency procurements made under AS 36.30.310.The Department of Transportation and Public Facilities shall, even if procurement authority has been delegated under AS 36.30.015 to another agency,by October 1 of each year,submit to the commissioner of administration records of the type specified in (a)of this section for single source procurement contracts made under AS 36.30.300.The commissioner of administration shall maintain these records as required by (a)of this section. Sec.36.30.522.Records of innovative procurements. The commissioner and the contracting agency shall keep a file for each contract awarded under an innovative procurement process under AS 36.30.308.The file is subject to inspection under the same standards as described in AS 36.30.140(b)and 36.30.230.The file kept by the commissioner must contain a summary of the information in the file of the contracting agency.The file kept by the contracting agency must contain (1)a copy of the contract; (2)the written determination under AS 36.30.308(a); (3)the procurement plan as approved as to form by the Department of Law; Exhibit S-3 Page 31 of 57 (4)the record of notice under AS 36.30.130;and (5)the record of respondents to solicitation. Sec.36.30.530.Public access to procurement information. Procurement information is public except as otherwise provided by law. Sec.36.30.540.Procurement report. The commissioner shall biennially prepare a report concerning procurements by agencies and notify the legislature that the report is available.The report must include (1)the records maintained by the commissioner under AS 36.30.510 and the records maintained under AS 36.30.520(a)for the previous two fiscal years; (2)a list of procurements made under this chapter from out-of-state sources during the previous two fiscal years together with the total number of procurement contracts entered into during that period with out-of-state contractors and the total value of these contracts;this paragraph does not apply to procurements made under AS 36.30.320;and (3)a list of procurements made under this chapter from state sources during the previous two fiscal years together with the total number of procurement contracts entered into during that period with state contractors and the total value of these contracts;this paragraph does not apply to procurements made under AS 36.30.320. Article 08.LEGAL AND CONTRACTUAL REMEDIES Sec.36.30.550.Applicability of protest and appeal procedures. (a)Except for small procurements made under AS 36.30.320,the provisions of AS 36.30.560 - 36.30.615 apply to a solicitation,a proposed contract award,and an award of a contract for supplies, services,professional services,or construction. (b)The commissioner shall adopt regulations providing for protest and appeal procedures of small procurements made under AS 36.30.320. Sec.36.30.560.Filing of a protest. An interested party may protest the award of a contract,the proposed award of a contract,ora solicitation for supplies,services,professional services,or construction by an agency.The protest shall be filed with the procurement officer of the contracting agency in writing and include the following information: (1)the name,address,and telephone number ofthe protester; Exhibit S-3 Page 32 of 57 (2)the signature of the protester or the protester's representative; (3)identification of the contracting agency and the solicitation or contract at issue; (4)a detailed statement of the legal and factual grounds of the protest,including copies of relevant documents;and (5)the form of relief requested. Sec.36.30.565.Time for filing a protest. (a)A protest based on alleged improprieties or ambiguities in a solicitation must be filed at least 10 days before the due date of the bid or proposal,unless a later protest due date is specifically allowed in the solicitation.If a solicitation is made with a shortened public notice period and the protest is based on alleged improprieties or ambiguities in the solicitation,the protest must be filed before the due date of the bid or proposal.Notwithstanding the other provisions in this subsection,the protest of an invitation to bid or a request for proposals in which a pre-bid or pre-proposal conference is held within 12 days of the due date must be filed before the due date of the bid or proposal if the protest is based on alleged improprieties or ambiguities in the solicitation.A protest based upon alleged improprieties in an award of a contract or a proposed award of a contract must be filed within 10 days after a notice of intent to award the contract is issued by the procurement officer. (b)lf the protester shows good cause,the procurement officer of the contracting agency may consider a filed protest that is not timely. Sec.36.30.570.Notice of a protest. The procurement officer shall immediately give notice of a protest filed under AS 36.30.565 to the contractor if a contract has been awarded or,if no award has been made,to all interested parties. Sec.36.30.575.Stay of award. if a protest is filed the award may be made unless the procurement officer of the contracting agency determines in writing that a (1)reasonable probability exists that the protest will be sustained;or (2)stay of the award is not contrary to the best interests of the state. Sec.36.30.580.Decision by the procurement officer. (a)The procurement officer of the contracting agency shall issue a written decision containing the basis of the decision within 15 days after a protest has been filed.A copy of the decision shall be furnished to the protester by certified mail or other method that provides evidence of receipt. (b)The time for a decision may be extended up to 30 days for good cause by the commissioner of administration,or,for protests involving construction or procurements for the state equipment fleet, Exhibit S-3 Page 33 of 57 the commissioner of transportation and public facilities.If an extension is granted,the procurement officer shall notify the protester in writing of the date that the decision is due. (c)If a decision is not made by the date it is due,the protester may proceed as if the procurement officer had issued a decision adverse to the protester. Sec.36.30.585.Protest remedies. (a)If the procurement officer sustains a protest in whole or in part,the procurement officer shall implement an appropriate remedy. (b)In determining an appropriate remedy,the procurement officer shall consider the circumstances surrounding the solicitation or procurement including the seriousness of the procurement deficiencies,the degree of prejudice to other interested parties or to the integrity of the procurement system,the good faith of the parties,the extent the procurement has been accomplished, costs to the agency and other impacts on the agency of a proposed remedy,and the urgency of the procurement to the welfare of the state. (c)Notwithstanding (a)and (b)of this section,if a protest is sustained in whole or part,the protester's damages are limited to reasonable bid or proposal preparation costs. Sec.36.30.590.Appeal on a protest. (a)An appeal from a decision of a procurement officer on a protest may be filed by the protester with the commissioner of administration,or for protests involving construction or procurements for the state equipment fleet,the commissioner of transportation and public facilities.An appeal shall be filed within 10 days after the decision is received by the protester.The protester shall file a copy of the appeal with the procurement officer. (b)An appeal must contain the information required under AS 36.30.560.In addition,the appeal must include (1)a copy of the decision being appealed;and (2)identification of the factual or legal errors in the decision that form the basis for the appeal. Sec.36.30.595.Notice and copy of a protest appeal. (a)The procurement officer shall immediately give notice of an appeal filed under AS 36.30.590 to the contractor if a contract has been awarded or,if no award has been made,to all interested parties. (b)The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,shall,on request,furnish a copy of the appeal to a person notified under (a)of this section,except that confidential material shall be deleted from the copy. Exhibit S-3 Page 34 of 57 Sec.36.30.600.Stay of award during protest appeal. If a protest appeal is filed before a contract is awarded and the award was stayed under AS 36.30.575, the filing of the appeal automatically continues the stay until the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,makes a written determination that the award ofthe contract without further delay is necessary to protect substantial interests of the state. Sec.36.30.605.Protest report and comments. (a)The procurement officer of the contracting agency shall file a complete report on the protest and decision with the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,within 10 days after a protest appeal is filed.The procurement officer shall furnish a copy of the report to the protester and to interested parties that have requested a copy of the appeal under AS 36.30.595(b). (b)The procurement officer may request an extension oftime to prepare the protest report. The request must be in writing listing the reasons for the request.The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,shall respond to the request in writing.If an extension is granted,the commissioner shall list the reasons for granting the extension and indicate the date the protest report is due.The commissioner shall notify the protester in writing that the time for submission of the report has been extended and the date the report is due. (c)The protester may file comments on the protest report with the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,within 10 days after the report is received.The protester shall provide copies of the comments to the procurement officer and to interested parties that have requested a copy of the appeal under AS 36.30.595(b). (d)The protester may request an extension of time to prepare the comments on the protest report.The request must be in writing listing the reasons for the request.The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,shall respond to the request in writing.If an extension is granted,the commissioner shall list the reasons for granting the extension and indicate the date the comments are due.The commissioner shall notify the procurement officer in writing that the time for submission of the comments has been extended and the date the comments are due. Sec.36.30.610.Decision without hearing. (a)The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,shall dismiss a protest appeal before a hearing is held if it is determined in writing that the appeal is untimely under AS 36.30.590(a). (b)The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,may issue a decision on an appeal without a hearing if the appeal involves questions of law without genuine issues of fact. Exhibit S-3 Page 35 of 57 (c)The commissioner of administration or the commissioner of transportation and public facilities,as appropriate,shall,within 15 days from the date the appellant's comments on the protest report are due under AS 36.30.605(c)and (d),notify the appellant of the acceptance or rejection of the appeal and,if rejected,the reasons for the rejection. Sec.36.30.615.Hearing on protest appeal. A hearing on a protest appeal shall be conducted in accordance with AS 36.30.670 and regulations adopted by the commissioner to the extent the regulations do not conflict with regulations adopted under AS 44.64.060. Sec.36.30.620.Contract claims. (a)A contractor shall file a claim concerning a contract awarded under this chapter with the procurement officer.The contractor shall certify that the claim is made in good faith,that the supporting data are accurate and complete to the best of the contractor's knowledge and belief,and that the amount requested accurately reflects the contract adjustment for which the contractor believes the state is liable.Except for a lease rate adjustment called for in the lease,a claim under this section must be filed within 90 days after the contractor becomes aware of the basis of the claim or should have known the basis of the claim,whichever is earlier.A lease rate adjustment called for in the lease must be filed prior to the expiration date of the lease. (b)If a claim asserted concerning a contract awarded under this chapter cannot be resolved by agreement,the procurement officer shall,after receiving a written request by the contractor for a decision,issue a written decision.The procurement officer shall make the decision not more than 90 days after receipt of all necessary information from the contractor.If the contractor fails to furnish necessary information requested by the procurement officer,the procurement officer shall proceed to decide the claim and may,in the procurement officer's discretion,deny all or part of the claim because of the failure to furnish necessary information.During an appeal under this chapter,the contractor may not rely on or introduce information that the contractor has failed to furnish to the procurement officer in support of the claim.Before issuing the decision,the procurement officer shall review the facts relating to the claim and obtain necessary assistance from legal,fiscal,and other advisors. (c)Upon the written request of the procurement officer,the time for issuing a decision under (b)of this section may be extended for up to 60 additional days by the commissioner if the claim concerns an amount in excess of $50,000.Upon the written request of the procurement officer showing that good cause exists for a second extension,the commissioner may extend the time for issuing a decision under (b)of this section up to 90 additional days after the first extension.The contractor shall be provided with an opportunity to oppose or otherwise respond to the request for a second extension. if a second extension is granted,the commissioner shall notify the contractor and the procurement officer in writing that the time for the issuance of a decision has been extended and of the date by which a decision shall be issued.In this subsection,"commissioner"means the commissioner of administration or,for a claim involving a construction contract or procurement for the state equipment fleet,the commissioner of transportation and public facilities. Exhibit S-3 Page 36 of 57 (d)The procurement officer shall furnish a copy of the decision to the contractor by certified mail or other method that provides evidence of receipt.The decision must include (1)a description of the claim; (2)a reference to the pertinent contract provisions; (3)a statement of the agreed upon and disputed facts; (4)findings of fact about the claim; (5)a determination of any amount payable; (6)a statement of reasons supporting the decision;and (7)a statement substantially as follows: "This is the final decision of the procurement officer.This decision may be appealed to the commissioner of (administration/transportation and public facilities).If you appeal,you must file a written notice of appeal with the commissioner within 14 days after you receive this decision." (e)If the procurement officer does not issue a written decision by the date it is due,the contractor may proceed as if the procurement officer had issued a decision adverse to the contractor. (f)If a claim asserted by the state concerning a contract awarded under this chapter cannot be resolved by agreement the matter shall be immediately referred to the commissioner of administration or the commissioner of transportation and public facilities,as appropriate. (g)This section does not apply to payment disputes governed by AS 37.05.285. Sec.36.30.623.Interest on certain claims. The amount ultimately determined to be due under AS 36.30.620 -36.30.630 and 36.30.670 -36.30.685 to a department contractor,the department,or a contracting agency to whom the responsibility for handling the claims is delegated by the department under AS 36.30.632 accrues interest at the rate applicable to judgments under AS 09.30.070(a).Notwithstanding AS 09.30.070(b),the interest accrues from the date that a complete claim is filed that meets the requirements of AS 36.30.620(a)through the date of a decision by the procurement officer under AS 36.30.620,a decision by the commissioner of transportation and public facilities under AS 36.30.680,or a judicial decision under AS 36.30.685, whichever decision is latest.In this section,"department"means the Department of Transportation and Public Facilities. Sec.36.30.625.Appeal ona contract claim. (a)An appeal from a decision of the procurement officer on a contract claim may be filed by the contractor with the commissioner of administration or,for a claim involving a construction contract or procurement for the state equipment fleet,the commissioner of transportation and public facilities.The Exhibit S-3 Page 37 of 57 appeal shall be filed within 14 days after the decision is received by the contractor.An appeal by a contractor of the Department of Transportation and Public Facilities may not raise any new factual issues or theories of recovery that were not presented to and decided by the procurement officer in the decision under AS 36.30.620(b},except that a contractor may increase the contractor's calculation of damages if the increase arises out of the same operative facts on which the original claim was based. The contractor shall file a copy of the appeal with the procurement officer. (b)An appeal must contain a copy of the decision being appealed and identification of the factual or legal errors in the decision that form the basis for the appeal. (c)The Department of Transportation and Public Facilities,or a contracting agency to whom the responsibility for handling the claim is delegated by the Department of Transportation and Public Facilities under AS 36.30.632,shall handle the appeal of a claim under this section expeditiously. Sec.36.30.627.Construction contract claim appeals. (a)An appeal from a decision of the procurement officer of a claim involving a construction contract shall be resolved by (1)binding and final arbitration under AS 09.43.010 -09.43.180 (Uniform Arbitration Act)or AS 09.43.300 -09.43.595 (Revised Uniform Arbitration Act),as applicable,if the claim is (A)less than $250,000 and the contractor requests arbitration of the claim;or (B)$250,000 or more and both the agency and the contractor agree to arbitration of the claim; or (2)a hearing under AS 36.30.630if the claim is not handled by arbitration under (1)of this subsection. (b)in this section,a claim includes all issues,causes of action,and controversies arising from a construction contract for which a contractor or the contracting agency asserts compensation is due. Sec.36.30.629.Subpoenas and discovery. In appeals under AS 36.30.627,the arbitrator or hearing officer may (1)issue subpoenas,including subpoenas duces tecum,to compel the attendance of witnesses and the production of documents; (2)allow the taking of depositions for discovery or to perpetuate testimony;and (3)refer a subpoena or subpoena duces tecum to the superior court for enforcement and the imposition of appropriate sanctions. Exhibit S-3 Page 38 of 57 Sec.36.30.630.Hearing on a contract claim;decision without hearing. (a)Except as provided in (b)of this section,a hearing shall be conducted according to AS 36.30.670 and,to the extent they do not conflict with regulations adopted under AS 44.64.060, regulations adopted by the commissioner of administration on a contract claim appealed to the commissioner of administration or the commissioner of transportation and public facilities or referred to either commissioner under AS 36.30.620(f). (b)Except as provided in AS 36.30.627(a)(1),within 15 days after receipt of an appeal ona contract claim,the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,may adopt the decision of the procurement officer as the final decision without a hearing. Sec.36.30.631.Attorney fees,costs,and offers of judgment. (a)An arbitrator in the arbitration of a construction contract claim under AS 36.30.627(a}(1)and a hearing officer for the hearing of a construction contract claim conducted under AS 36.30.627(a)(2) shall award the prevailing party attorney fees and costs incurred in the arbitration or hearing.The award shall be made as provided by Rules 68,79,and 82 of the Alaska Rules of Civil Procedure. (b)Either party to an arbitration of a construction contract claim conducted under AS 36.30.627 or a hearing of a construction contract claim conducted under AS 36.30.630(a)may serve on the adverse party an offer to allow a final decision to be entered in complete satisfaction of the claim.The offer shall be made,accepted,or rejected as provided for an offer of judgment under Rule 68 of the Alaska Rules of Civil Procedure.Acceptance or rejection of the offer has the same consequences as acceptance or rejection of an offer of judgment made in a civil action under Rule 68 of the Alaska Rules of Civil Procedure. Sec.36.30.632.Delegation. The commissioner of administration and the commissioner of transportation and public facilities may delegate responsibilities under AS 36.30.590 -36.30.630 to the head of the contracting agency. Sec.36.30.635.Authority to debar or suspend. (a)After consultation with the using agency and the attorney general and after a hearing conducted according to AS 36.30.670 and,to the extent they do not conflict with regulations adopted under AS 44.64.060,regulations adopted by the commissioner of administration,the commissioner of administration or the commissioner of transportation and public facilities may debar a person for cause from consideration for award of contracts.Notice of a debarment hearing shall be provided in writing at least seven days before the hearing.The debarment may not be for a period of more than three years. (b)The commissioner of administration or the commissioner of transportation and public facilities,after consultation with the using agency and the attorney general,may suspend a person from consideration for award of contracts if there is probable cause for debarment and compelling reasons Exhibit S-3 Page 39 of 57 require suspension to protect state interests.The suspension may not be for a period exceeding three months. (c)The authority to debar or suspend shall be exercised in accordance with regulations adopted by the commissioner of administration. Sec.36.30.640.Causes for debarment or suspension. The causes for debarment or suspension include (1)conviction for commission of a criminal offense as an incident to obtaining or attempting to obtain a public or private contract or subcontract,or in the performance of the contract or subcontract; (2)conviction under state or federal statutes of embezzlement,theft,forgery,bribery, falsification or destruction of records,receiving stolen property,or other offense indicating a lack of business integrity or business honesty that currently and seriously affects responsibility as a state contractor; (3)conviction or civil judgment finding a violation under state or federal antitrust statutes; (4)violation of contract provisions of a character that is regarded by the commissioner to be so serious as to justify debarment action,such as (A)knowing failure without good cause to perform in accordance with the specifications or within the time limit provided in the contract;or (B)failure to perform or unsatisfactory performance in accordance with the terms of one or more contracts,except that failure to perform or unsatisfactory performance caused by acts beyond the control of the contractor may not be considered to be a basis for debarment; (5)for violation of the ethical standards set out in law or regulation; (6)for a violation of this chapter punishable under AS 36.30.930(2);and (7)any other cause listed in regulations of the commissioner determined to be so serious and compelling as to affect responsibility as a state contractor,including debarment by another governmental entity for a cause listed in the regulations. Sec.36.30.645.Written determinations. (a)The commissioner of administration or the commissioner of transportation and public facilities shall issue a written decision to debar or suspend.The decision must (1)state the reasons for the action taken;and (2)inform the debarred person of rights to judicial appeal or inform the suspended person of rights to administrative and judicial appeal. Exhibit S-3 Page 40 of 57 (b)A copy of the decision under (a)of this section shall be mailed or otherwise furnished immediately to the debarred or suspended person and any other intervening party. Sec.36.30.650.Hearing on a suspension. (a)A person suspended under AS 36.30.635 is entitled to a hearing conducted according to AS 36.30.670 and,to the extent that they do not conflict with regulations adopted under AS 44.64.060, regulations adopted by the commissioner of administration,if the person files a written request for a hearing with the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,within seven days after receipt of the notice of suspension under AS 36.30.645. (b)If a suspended person requests a hearing,the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,after consulting with the office of administrative hearings (AS 44.64.010),shall schedule a prompt hearing unless the attorney general determines that a hearing at the proposed time is likely to jeopardize an investigation.A hearing may not be delayed longer than six months after notice of the suspension is provided under AS 36.30.645. Sec.36.30.655.List of persons debarred or suspended. The commissioner shall maintain a list of all persons debarred or suspended from consideration for the award of contracts. Sec.36.30.660.Reinstatement. (a)The commissioner of administration or the commissioner of transportation and public facilities may at any time after a final decision to debar a person from consideration for award of contracts reinstate the person after determining that the cause for which the person was debarred no longer exists or has been substantially mitigated. (b)A debarred person may request reinstatement by submitting a petition to the commissioner of administration or the commissioner of transportation and public facilities supported by evidence showing that the cause for debarment no longer exists or has been substantially mitigated. (c)The commissioner of administration or the commissioner of transportation and public facilities may require a hearing on a reinstatement petition.A decision on reinstatement shall be made in writing within seven days after a reinstatement petition is submitted.The decision must specify the factors on which it is based.A decision under this section is not subject to judicial appeal. Sec.36.30.665.Limited participation by debarred person. The commissioner of administration or the commissioner of transportation and public facilities may permit a debarred person to participate in a contract on a limited basis during the debarment period if the commissioner determines in writing that the participation is advantageous to the state.The Exhibit S-3 Page 41 of 57 determination shall specify the factors on which it is based and the limits imposed on the debarred person. Sec.36.30.670.Hearing procedures. (a)The chief administrative law judge (AS 44.64.010)shall assign an administrative law judge to act as a hearing officer for a hearing conducted under this chapter.The hearing officer shall arrange for a prompt hearing and notify the parties in writing of the time and place of the hearing.The hearing shall be conducted in an informal manner.The provisions of AS 44.62 (Administrative Procedure Act)do not apply to a hearing conducted under this chapter. (b)The hearing officer may (1)hold prehearing conferences to settle,simplify,or identify the issues in a proceeding,or to consider other matters that may aid in the expeditious disposition of the proceeding; (2)require parties to state their positions concerning the various issues in the proceeding; (3)require parties to produce for examination those relevant witnesses and documents under their control; (4)rule on motions and other procedural matters; (5)regulate the course of the hearing and conduct ofthe participants; (6)establish time limits for submission of motions or memoranda; (7)impose appropriate sanctions against a person who fails to obey an order ofthe hearing officer,including (A)prohibiting the person from asserting or opposing designated claims or defenses or introducing designated matters into evidence; (B)excluding all testimony of an unresponsive or evasive witness;and (C)excluding a person from further participation in the hearing; (8)take official notice of a material fact not appearing in evidence,if the fact is among the traditional matters subject to judicial notice; (9)administer oaths or affirmations. (c)A transcribed record of the hearing shall be made available at cost to a party that requests it. Exhibit S-3 Page 42 of 57 Sec.36.30.675.Recommended decision and commissioner action. (a)The hearing officer shall recommend a decision to the commissioner of administration or the commissioner of transportation and public facilities,as appropriate,based on the evidence presented. The recommendation must include findings of fact and conclusions of law. (b)The commissioner of administration or the commissioner of transportation and public facilities may affirm,modify,or reject the hearing officer's recommendation in whole or in part,may remand the matter to the hearing officer with instructions,or take other appropriate action. Sec.36.30.680.Final decision by the commissioner. A decision by the commissioner of administration or the commissioner of transportation and public facilities after a hearing under this chapter is final.A decision shall be sent within 20 days after the hearing to all parties by personal service or certified mail,except that a decision by the commissioner of transportation and public facilities involving procurement of construction shall be sent to all parties by personal service or certified mail within 45 days after receipt by the commissioner of transportation and public facilities of the hearing officer's decision. Sec.36.30.685.Judicial appeal. (a)A final decision of the commissioner of administration or the commissioner of transportation and public facilities under AS 36.30.610,36.30.635(a},36.30.650,or 36.30.680 may be appealed to the superior court in accordance with the Alaska Rules of Appellate Procedure. (b)A final decision of the commissioner of administration or the commissioner of transportation and public facilities under AS 36.30.630(b)may be appealed to the superior court for a trial de novo. Sec.36.30.687.Misrepresentations,fraud,and attempted fraud. (a)A person who makes or uses in support of a contract claim under this chapter,a misrepresentation,or who practices or attempts to practice a fraud,at any stage of proceedings relating to a procurement or contract claim under this chapter (1)forfeits all claims relating to that procurement or contract;and (2)is liable to the state for reimbursement of all sums paid on the claim,for all costs attributable to review of the claim,and for a civil penalty equal to the amount by which the claim is misrepresented. (b)The procurement officer,commissioner or court shall make specific findings of misrepresentation,attempted fraud,or fraud before declaring a forfeiture under (a)(1)of this section. (c)Suits to recover costs and penalties under (a)(2)of this section must be commenced within six years after the discovery of the misrepresentation,fraud,or attempted fraud. (d)A person who in a matter relating to a procurement or a contract claim under this chapter makes a misrepresentation to the state through a trick,scheme,or device is guilty of a class C felony. Exhibit S-3 Page 43 of 57 (e)In this section,"misrepresentation"means a false or misleading statement of material fact, or conduct intended to deceive or mislead concerning material fact,whether it succeeds in deceiving or misleading. Sec.36.30.690.Exclusive remedy. Notwithstanding AS 44.77 or other law to the contrary,AS 36.30.560 -36.30.699 and regulations adopted under those sections provide the exclusive procedure for asserting a claim against an agency arising in relation to a procurement under this chapter. Sec.36.30.695.Other rules of procedure. (a)The commissioner may adopt by regulation additional rules of procedure providing for the expeditious arbitration,hearing,and other administrative review of all contract claims,both before the contracting agency and through an appeal heard de novo. (b)Except as provided by (c)of this section,an arbitrator shall issue a final decision,and a hearing officer shall issue a recommended decision,within the following time limits after the date the record on the claim is closed: (1)30 calendar days for a claim of less than $100,000; (2)45 calendar days for a claim of $100,000 or more but fess than $1,000,000;or (3)60 calendar days for a claim of $1,000,000 or more. (c)The commissioner of administration or the commissioner of transportation and public facilities may,for good cause shown,grant an arbitrator or a hearing officer additional time to issue a decision. (d)If an arbitrator or hearing officer fails to issue a decision within the time allowed for a decision under (b)or (c)of this section,the arbitrator or hearing officer is disqualified from acting as an arbitrator or hearing officer in another proceeding under this chapter for one year after the decision is issued. (e)The venue for an arbitration or hearing under this chapter is the judicial district where the office of the contracting agency is located,unless the agency and the contractor agree on another location. (f)If a party fails to appear at a proceeding under this chapter,the arbitrator or hearing officer may proceed in the party's absence. (g)Subject to appropriation,any money awarded by an arbitrator's decision shall be paid within 45 days after the date that the arbitrator's decision is final.Subject to appropriation,any money awarded by a hearing officer's recommended decision that is approved by the commissioner of transportation and public facilities shall be paid within 45 days after the date that the commissioner's Exhibit S-3 Page 44 of 57 decision is delivered to the contractor and the agency,unless the commissioner's decision is appealed under AS 36.30.685. Sec.36.30.699.Definition. In AS 36.30.560 -36.30.695,"interested party"means an actual or prospective bidder or offeror whose economic interest may be affected substantially and directly by the issuance of a contract solicitation, the award of a contract,or the failure to award a contract;whether an actual or prospective bidder or offeror has an economic interest depends on the circumstances. Article 09.INTERGOVERNMENTAL RELATIONS Sec.36.30.700.Cooperative purchasing authorized. A public procurement unit may either participate in,sponsor,conduct,or administer a cooperative purchasing agreement for the procurement of supplies,services,professional services,or construction with one or more public procurement units or external procurement activities in accordance with an agreement entered into between the participants.Cooperative purchasing may include joint or multi- party contracts between public procurement units and open-ended state public procurement units contracts that are made available to local public procurement units. Sec.36.30.710.Interagency sale,acquisition,and use of supplies and services. (a)A public procurement unit may sell to,acquire from,or use any supplies belonging to another public procurement unit or external procurement activity independent of the requirements of AS 36.30.060 and 36.30.100 -36.30.260. (b)A public procurement unit may enter into an agreement,independent of the requirements of AS 36.30.060 and 36.30.100 -36.30.260,with another public procurement unit or external procurement activity for the cooperative use of supplies or services under the terms agreed upon between the parties. Sec.36.30.720.Joint use or lease of facilities and equipment. A public procurement unit may enter into agreements for the common use or lease of warehousing facilities,capital equipment,and other facilities with another public procurement unit or an external procurement activity under the terms agreed upon between the parties. Sec.36.30.730.Supply of personnel,services,and other items. (a)A public procurement unit may,upon written request from another public procurement unit or external procurement activity,provide personnel to the requesting public procurement unit or external procurement activity.The public procurement unit or external procurement activity making the request shall pay the public procurement unit providing the personnel the direct and indirect cost of furnishing the personnel,in accordance with an agreement between the parties. Exhibit S-3 Page 45 of 57 (b)The informational,technical,and other services of a public procurement unit may be made available to another public procurement unit or external procurement activity except that the requirements of the public procurement unit tendering the services has precedence over the requesting public procurement unit or external procurement activity.The requesting public procurement unit or external procurement activity shall pay for the expenses of the services so provided,in accordance with an agreement between the parties. (c)Upon request,the commissioner may make available to public procurement units or external procurement activities the following services,among others: (1)standard forms; (2)printed manuals; (3)product specifications and standards; (4)quality assurance testing services and methods; (5)qualified products lists; (6)source information; (7)common use commodities listings; (8)supplier performance ratings; (9)lists of persons debarred or suspended from consideration for award of state contracts; (10)forms for invitations for bids,requests for proposals,instructions to bidders,general contract provisions,and other contract forms;and (11)contracts or published summaries of them,including price and time of delivery information. (d)The commissioner may provide the following technical services,among others: (1)development of product specifications; (2)development of quality assurance test methods,including receiving,inspection,and acceptance procedures; (3)use of product testing and inspection facilities;and (4)use of personnel training programs. (e)The commissioner may enter into contractual arrangements and publish a schedule of fees for the services provided under (c)and (d)of this section. (f)[Repealed,Sec.28 ch 90 SLA 1991]. Exhibit S-3 Page 46 of 57 Sec.36.30.735.Restriction on contracting with or employing experts on radiation hazards. (a)Except for the Department of Health and Social Services,the Department of Labor and Workforce Development,the Department of Environmental Conservation,and the Department of Military and Veterans'Affairs,a state agency may not (1)contract,other than with the Department of Health and Social Services,to have services performed that require expertise in determining or reducing the hazards of radiation;or (2)employ a person whose duties require expertise in determining or reducing the hazards of radiation. (b)In this section,"state agency" (1)means a state department or agency,whether in the legislative,judicial,or executive branch; (2)does not include the University of Alaska,a municipality,or an agency of a municipality. (c)In this section,"radiation"does not include radiation emitted from a Federal Communications Commission licensed facility emitting radiation of a wave length longer than one centimeter and an average power output not exceeding two kilowatts. Sec.36.30.740.Information relating to procurement needs. To the extent possible,the commissioner may collect information concerning the type,cost,quality,and quantity of commonly used supplies,equipment for the state fleet,services,or construction being procured or used by state public procurement units.The commissioner may also collect this information from local public procurement units.The commissioner may make this information available to a public procurement unit upon request. Sec.36.30.750.Contract claims of other procurement units. (a)Under a cooperative purchasing agreement,claims arising between an administering public procurement unit and its bidders,offerors,or contractors shall be resolved in accordance with AS 36.30.560 -36.30.699. (b)A local public procurement unit that is not subject to AS 36.30.560 -36.30.699 may enter into an agreement with another local public procurement unit or external procurement activity to establish procedures or use that unit's or activity's existing procedures to resolve claims with contractors,whether or not the claim arose under a cooperative purchasing agreement. Sec.36.30.790.Definitions. In AS 36.30.700 -36.30.790, (1)"cooperative purchasing"means procurement conducted by,or on behalf of,more than one public procurement unit,or by a public procurement unit with an external procurement activity; Exhibit S-3 Page 47 of 57 (2)"external procurement activity"means a buying organization not located in this state that,if located in this state,would qualify as a public procurement unit;an agency of the United States is an external procurement activity; (3)"local public procurement unit"means a municipality or other subdivision of the state or other entity that expends public funds for the procurement of supplies,services,professional services, and construction,and any nonprofit corporation operating a charitable hospital; (4)"public procurement unit"means either a local public procurement unit or a state public procurement unit; (5)"state public procurement unit"means the Department of Administration and any other contracting agency of the state. Article 10.GENERAL PROVISIONS Sec.36.30.850.Application of this chapter. (a)This chapter applies only to contracts solicited or entered into after January 1,1988,unless the parties agree to its application to a contract solicited or entered into before that date. (b)This chapter applies to every expenditure of state money by the state,acting through an agency,under a contract,except that this chapter does not apply to (1)grants; (2)contracts for professional witnesses to provide for professional services or testimony relating to (A)existing or probable lawsuits in which the state is or may become a party;or (B)litigation in which the Public Defender Agency or the office of public advocacy has been appointed to represent a person; (3)contracts of the University of Alaska where the work is to be performed substantially by students enrolled in the university; (4)contracts for medical doctors and dentists; (5)acquisitions or disposals of real property or interest in real property,except as provided in AS 36.30.080 and 36.30.085; (6)disposals under AS 38.05; (7)contracts for the transportation of ballots under AS 15; (8)acquisitions or disposals of property and other contracts relating to airports under AS 02.15.070,02.15.090,02.15.091,and AS 44.88; Exhibit S-3 Page 48 of 57 (9)disposals of obsolete property under AS 19.05.060; (10)disposals of obsolete material or equipment under AS 35.20.060; (11)agreements with providers of services under AS 47.25.071 -47.25.095;AS 47.07;AS 47.08; AS 47.10;AS 47.12;AS 47.14;AS 47.17;AS 47.24;and AS 47.27,including contractors under AS 47.27.050; (12)contracts of the Department of Fish and Game for flights that involve specialized flying and piloting skills and are not point-to-point; (13)purchases of income-producing assets for the state treasury or a public corporation of the state; (14)a contract that is a delegation,in whole or in part,of investment powers held by (A)the commissioner of revenue under AS 14.42.200,14.42.210,AS 18.56.095,AS 37.10.070, 37.10.071,or AS 37.14; (B)the Board of Regents of the University of Alaska under AS 14.40.250 -14.40.491; (15)a contract that is a delegation,in whole or in part,of investment powers or fiduciary duties of (A)the Board of Trustees of the Alaska Permanent Fund Corporation under AS 37.13; (B)the Alaska Mental Health Trust Authority under AS 37.14.001 -37.14.099; (16)the purchase of books,book binding services,newspapers,periodicals,audio-visual materials,network information services access,approval plans,professional memberships,archival materials,objects of art,and items for museum or archival acquisition having cultural,historical,or archaeological significance;in this paragraph (A)"approval plans"means book selection services in which current book titles meeting an agency's customized specifications are provided to the agency subject to the right of the agency to return those books that do not meet with the agency's approval; (B)"archival materials"means the noncurrent records of an agency that are preserved after appraisal because of their value; (C)"audio-visual materials"means nonbook prerecorded materials,including records,tapes, slides,transparencies,films,filmstrips,cassettes,videos,compact discs,laser discs,and items that require the use of equipment to render them usable; (D)"network information services"means a group of resources from which cataloging information,holdings records,inter-library loans,acquisitions information,and other reference resources can be obtained; Exhibit S-3 Page 49 of 57 (17)contracts for the purchase of standardized examinations for licensure under AS 08; (18)contracts for home health care provided under regulations adopted by the Department of Health and Social Services and for adult residential care services provided under regulations adopted by the Department of Health and Social Services or by the Department of Administration; (19)contracts for supplies or services for research projects funded by money received from the federal government or private grants; (20)guest speakers or performers for an educational or cultural activity; (21)contracts of the Alaska Industrial Development and Export Authority for a clean coal technology demonstration project that (A)is attempting to develop a coal-fired electric generation project; (B)uses technology that is capable of commercialization during the 1990's;and (C)qualifies for federal financial participation under P.L.99-190 as amended; (22)operation and protection of assets or disposals of equipment and supplies acquired through foreclosure or other legal proceedings relating to loans issued under AS 03.10; (23)purchases of curatorial and conservation services to maintain,preserve,and interpret (A)objects of art;and (B)items having cultural,historical,or archaeological significance to the state; (24)acquisition of confidential seismic survey data necessary for pre-sale oil and gas lease or gas only lease analyses under AS 38.05.180; (25)contracts for village public safety officers; (26)purchases of supplies and services to support the operations of the Alaska state troopers or law enforcement officers engaged in fish and wildlife protection if the procurement officer for the Department of Public Safety makes a written determination that publicity of the purchases would jeopardize the safety of personnel or the success of a covert operation; (27)expenditures when rates are set by law or ordinance; (28)construction of new vessels by the Department of Transportation and Public Facilities for the Alaska marine highway system; (29)contracts entered into with a regional development organization;in this paragraph, "regional development organization”means a nonprofit organization or nonprofit corporation formed to encourage economic development within a particular region of the state that includes the entire area Exhibit S-3 Page 50 of 57 of each municipality within that region and that has a board of directors that represents the region's economic,political,and social interests; (30)contracts that are to be performed in an area outside of the country and that require a knowledge of the customs,procedures,rules,or laws of the area; (31)contracts that are between the (A)Department of Law and attorneys who are not employed by the state and that are for the review or prosecution of possible violations of the criminal law ofthe state in situations where the attorney general concludes that an actual or potential conflict of interest makes it inappropriate for the Department of Law to review or prosecute the possible violations;and (B)Public Defender Agency or the office of public advocacy and attorneys who are not employed by the state and that are for the review or defense of possible violations of the criminal law of the state in situations where the public defender or the director of the office of public advocacy concludes that an actual or potential conflict of interest makes it inappropriate for the Public Defender Agency or the office of public advocacy to review or defend the possible violations; (32)contracts between the Department of Natural Resources and contractors qualified to evaluate hydrocarbon development,production,transportation,and economics,to assist the commissioner of natural resources in evaluating applications for royalty increases or decreases or other royalty adjustments,and evaluating the related financial and technical data,entered into under AS 38.05.180(j); (33)contracts of the Alaska Industrial Development and Export Authority made with the developer of an integrated transportation and port facility owned by the authority; (34)procurements of contracts with the media for advertising; (35)contracts between the state medical examiner and a provider of medical services to perform or assist in performing the duties assigned to the state medical examiner in AS 12.65.020; (36)contracts between the commissioner of revenue and an independent contractor under AS 43.82.240; (37)contracts for a convener under AS 44.62.730 or for a facilitator under AS 44.62.760 related to a negotiated regulation making process under AS 44.62.710 -44.62.800; (38)grants and contracts with qualified entities for services under AS 47.18.330 for the foster care transition program; (39)contracts for travel services,including airplane travel,hotel accommodations,and travel agency services,but excluding motor vehicle rentals; Exhibit S-3 Page 51 of 57 (40)contracts of the Alaska Commission on Postsecondary Education or the Alaska Student Loan Corporation for the guarantee and disbursing of financial aid money to institutions of postsecondary education under the financial aid programs under AS 14.43.091 -14.43.750 and AS 14.44.025; (41)contracts for an arbitration panel to determine whether a project is uneconomic under AS 43.90.240,and contracts for the development of application provisions for licensure and for the evaluation of those applications under AS 43.90; (42)contracts for delivery of home heating assistance under AS 47.25.626; (43)contracts of the Alaska Pension Obligation Bond Corporation under AS 37.16.010 - 37.16.900; (44)the Alaska Gasline Development Corporation (AS 31.25)and subsidiaries of the Alaska Gasline Development Corporation. (45)contracts for professional and technical services by the Department of Natural Resources to support the development of agreements and contracts under AS 38.05.020(b)(10)and (11); (46)contracts of the Department of Law developed with client participation for legal services related to an Alaska liquefied natural gas project as that project is defined in AS 31.25.390,except that, to the extent practicable,the Department of Law shall use the procurement process under AS 36.30.320 with the participation of the client. (c)Except for AS 36.30.085 and 36.30.700 -36.30.790,this chapter does not apply to contracts between two or more agencies,the state and its political subdivisions,or the state and other governments. (d)Nothing in this chapter or in regulations adopted under this chapter prevents an agency or political subdivision from complying with the terms and conditions of a grant,gift,bequest,cooperative agreement,or federal assistance agreement. (e)[Renumbered as AS 36.30.170(i).For current law,see AS 36.30.321]. Sec.36.30.860.Supplementary general principles of law applicable. Unless displaced by the particular provisions of this chapter,the principles of law and equity,including AS 45.01 -AS 45.08,AS 45.12,45.14,and 45.29 (Uniform Commercial Code),the law merchant,and law relative to capacity to contract,agency,fraud,misrepresentation,duress,coercion,mistake,or bankruptcy shall supplement the provisions of this chapter. Sec.36.30.870.Adoption of regulations. (a)Regulations under this chapter shall be adopted in accordance with AS 44.62 (Administrative Procedure Act). Exhibit S-3 Page 52 of 57 (b)Regulations under this chapter applicable to procurements of construction or procurements for or disposal of property of the state equipment fleet shall be adopted by the commissioner of administration only after consultation with the commissioner of transportation and public facilities. (c)The commissioner of administration shall adopt regulations establishing the procedures for arbitration under AS 36.30.627(a),including establishing the qualifications for arbitrators and the method for appointing neutral arbitrators to conduct arbitrations. Sec.36.30.880.Requirement of good faith. All parties involved in the negotiation,performance,or administration of state contracts shall act in good faith. Sec.36.30.890.Federal funds or assistance. If a procurement involves the expenditure of federal funds or federal assistance and there is a conflict between a provision of this chapter or a regulation adopted under a provision of this chapter and a federal statute,regulation,policy,or requirement,the federal statute,regulation,policy,or requirement shall prevail. Sec.36.30.900.Product preferences.[Repealed,Sec.48 ch 137 SLA 1996]. Repealed or Renumbered Sec.36.30.910.Purchases through general services administration. Notwithstanding any other provision of this chapter,purchasing through the general services administration or from federal supply schedules of the general services administration may be made without competitive sealed bidding,competitive sealed proposals,or other competition,so long as the purchasing is from persons located in the state in accordance with regulations adopted by the commissioner for purchases under this section and as provided under 41 U.S.C.251 -266. Sec.36.30.920.Reporting of anticompetitive practices. When for any reason collusion or other anticompetitive practices are suspected among bidders or offerors,a notice of the relevant facts shall be transmitted to the attorney general by the person who suspects the collusion or other anticompetitive practices. Sec.36.30.930.Civil and criminal penalties. The following penalties apply to violations of this chapter: (1)a person who contracts for or purchases supplies,equipment for the state fleet,services, professional services,or construction in a manner the person knows to be contrary to the requirements of this chapter or the regulations adopted under this chapter is liable for all costs and damages to the state arising out of the violation; Exhibit S-3 Page 53 of 57 (2)a person who intentionally or knowingly contracts for or purchases supplies,equipment for the state fleet,services,professional services,or construction under a scheme or artifice to avoid the requirements ofthis chapter is guilty of a class C felony. Sec.36.30.940.Enforcement. The attorney general on behalf of the state shall enforce the provisions of this chapter. Sec.36.30.950.Severability. If any provision of this chapter or any application of this chapter to any person or circumstance is held invalid,the invalidity does not affect other provisions or applications of this chapter that can be given effect without the invalid provision or application,and to this end the provisions of this chapter are declared severable. Sec.36.30.990.Definitions. In this chapter,unless the context in which a term is used clearly requires a different meaning ora different definition is prescribed for a particular provision, (1)"agency” (A}means a department,institution,board,commission,division,authority,public corporation, the Alaska Pioneers'Home,the Alaska Veterans'Home,or other administrative unit of the executive branch of state government; (B)does not include (i)the University of Alaska; (ii)the Alaska Railroad Corporation; (iii)the Alaska Housing Finance Corporation; (iv)a regional Native housing authority created under AS 18.55.996 or a regional electrical authority created under AS 18.57.020; (v)the Department of Transportation and Public Facilities,in regard to the repair,maintenance, and reconstruction of vessels,docking facilities,and passenger and vehicle transfer facilities of the Alaska marine highway system; (vi)the Alaska Aerospace Corporation; (vii)the Alaska Retirement Management Board; (viii)the Alaska Seafood Marketing Institute; (ix)the Alaska children's trust and the Alaska Children's Trust Board; Exhibit S-3 Page 54 of 57 (x)the Alaska Industrial Development and Export Authority; (2)"Alaska bidder"means a person who (A)holds a current Alaska business license; (B)submits a bid or proposal for goods,services,or construction under the name appearing on the person's current Alaska business license; (C)has maintained a place of business in the state staffed by the bidder or offeror or an employee of the bidder or offeror for a period of six months immediately preceding the date of the bid or proposal; (D)is incorporated or qualified to do business under the laws of the state,is a sole proprietorship and the proprietor is a resident of the state,is a limited liability company organized under AS 10.50 and all members are residents of the state,or is a partnership under former AS 32.05,AS 32.06,or AS 32.11 and all partners are residents of the state;and (E)if a joint venture,is composed entirely of ventures that qualify under (A)-(D)of this paragraph; (3)"change order"means a written order signed by the procurement officer,directing the contractor to make changes that the changes clause of the contract authorizes the procurement officer to order without the consent of the contractor; (4)"commissioner"means the commissioner of administration; (5S)"competitive sealed bidding”means the procedure under AS 36.30.100 -36.30.190; (6)"competitive sealed proposals"means the procedure under AS 36.30.200 -36.30.260; (7)"construction"means the process of building,altering,repairing,maintaining,improving,or demolishing a public highway,structure,building,or other public improvement of any kind to real property other than privately owned real property leased for the use of agencies;it includes services and professional services relating to planning and design required for the construction;it does not include the routine operation ofa public improvement to real property nor does it include the construction of public housing; (8)"contract"means all types of state agreements,regardless of what they may be called,for the procurement or disposal of supplies,equipment for the state fleet,services,professional services,or construction; (9)"contract modification"means a written alteration in specifications,delivery point,rate of delivery,period of performance,price,quantity,or other provisions of a contract accomplished by mutual action of the parties to the contract; (10)"department”means the Department of Administration; Exhibit S-3 Page 55 of $7 (11)"design-build construction contract”means a contract to provide construction in accordance with a design provided by the contractor; (12)"employment program”means a nonprofit program to increase employment opportunities for individuals with physica!or mental disabilities that constitute substantial barriers to employment; (13)"grant"means property furnished by the state,whether real or personal,designated by law, including an appropriation Act,as a grant; (14)"hearing"does not include a hearing in an arbitration; (15)"in writing"has the meaning given to "written”in this section; (16)"lease-financing agreement"means a lease-purchase agreement that secures or is related to financing instruments of the lessor,including revenue bonds or certificates of participation; (17)"lease-purchase agreement"means a lease that (A)transfers ownership of the property to the lessee by the end ofthe lease term; (B)contains a purchase option at a price less than the fair market value of the property on the date the option is exercisable; (C)has a term,at inception,equal to 75 percent or more of the economic life of the property;or (D}contains minimum lease payments,including minimum lease payments during a renewal provided for in the agreement,whose present value at the inception of the agreement equals 90 percent or more of the fair market value at the inception of the agreement ofthe real property that is the subject of the agreement;the present value shall be determined by using as a discount rate the most recent Bond Buyer 20-Bond G.O.Index; (18)"person"means a business,individual,union,committee,club,other organization,or group of individuals; (19)"procurement"means buying,purchasing,renting,leasing,or otherwise acquiring supplies, equipment for the state fleet,services,or construction;it also includes functions that pertain to the obtaining of a supply,equipment for the state fleet,service,or construction,including description of requirements,selection and solicitation of sources,preparation and award of contract,and all phases of contract administration; (20)"procurement officer"means a person authorized to enter into and administer contracts for an agency and make written determinations with respect to them;it also includes an authorized representative of a procurement officer acting within the limits of authority; (21)"professional services"means professional,technical,or consultant's services that are predominantly intellectual in character,result in the production of a report or the completion of a task, and include analysis,evaluation,prediction,planning,or recommendation; Exhibit S-3 Page 56 of 57 (22)"public building"means improved real property leased to the state for governmental, public,or educational use,but does not include improved real property owned by the University of Alaska Heating Corporation and leased to the University of Alaska for a purpose within the scope,as of July 1,1986,of the heating corporation's charter; (23)"services"means the furnishing of labor,time,or effort by a contractor,not involving the delivery of a specific end product other than reports that are merely incidental to the required performance;it does not include employment agreements or collective bargaining agreements; (24)"state money”means any money appropriated to an agency or spent by an agency irrespective of its source,including federal assistance except as otherwise specified in AS 36.30.890,but does not include money held in trust by an agency for a person; (25)"state official”means a public employee,public officer,or official of an agency; (26)"supplies"means all property of an agency,including equipment,materials,and insurance; it includes privately owned real property leased for the use of agencies,such as office space,but does not include the acquisition or disposition of other interests in land; (27)"written”means the product of forming characters on paper,other materials,or viewable screens,that can be read,retrieved,and reproduced,including information that is electronically transmitted and stored. Sec.36.30.995.Short title. This chapter may be cited as the State Procurement Code. Exhibit S-3 Page 57 of 57 Exhibit $-4 Chapter 40.25.PUBLIC RECORD DISCLOSURES Article 01.INSPECTION AND COPYING OF PUBLIC RECORDS Sec.40.25.100.Disposition of tax information. (a)Information in the possession of the Department of Revenue that discloses the particulars of the business or affairs of a taxpayer or other person,including information under AS 38.05.020(b)(11) that is subject to a confidentiality agreement under AS 38.05.020(b)(12),is not a matter of public record, except as provided in AS 43.05.230(i)or (k)or for purposes of investigation and law enforcement.The information shall be kept confidential except when its production is required in an official investigation, administrative adjudication under AS 43.05.405 -43.05.499,or court proceeding.These restrictions do not prohibit the publication of statistics presented in a manner that prevents the identification of particular reports and items,prohibit the publication of tax lists showing the names of taxpayers who are delinquent and relevant information that may assist in the collection of delinquent taxes,or prohibit the publication of records,proceedings,and decisions under AS 43.05.405 -43.05.499. (b)If a copy of a record of tax information is requested under (a)of this section for the purposes of child support administration,the copy may be released only to the child support services agency created in AS 25.27.010 or a child support enforcement agency of another state.The Department of Revenue shall provide the requesting agency with a copy of the record.The requesting agency receiving information under this subsection may use it only for child support purposes authorized under law. Sec.40.25.105.Disclosure of information for compliance with the tobacco product Master Settlement Agreement. (a)Notwithstanding the provisions of AS 40.25.100(a),the Department of Revenue may disclose information submitted to the Department of Revenue relating to cigarette and tobacco products, cigarette and tobacco product manufacturers,and cigarette and tobacco product retailers to the attorney general and to other parties as the Department of Revenue determines necessary to monitor and enforce compliance by cigarette and tobacco product manufacturers with the tobacco product Master Settlement Agreement described in AS 45.53.010 -45.53.100. (b)A person receiving information under this section shall maintain the confidentiality that the Department of Revenue is required to extend under AS 43.05.230 to the returns,reports,documents, determinations,and workpapers furnished to that person under this section. Sec.40.25.110.Public records open to inspection and copying;fees. (a)Unless specifically provided otherwise,the public records of all public agencies are open to inspection by the public under reasonable rules during regular office hours.The public officer having the custody of public records shall give on request and payment of the fee established under this section or AS 40.25.115 a certified copy of the public record. Exhibit S-4 Page 1 of 9 (b)Except as otherwise provided in this section,the fee for copying public records may not exceed the standard unit cost of duplication established by the public agency. (c}If the production of records for one requester in a calendar month exceeds five person- hours,the public agency shall require the requester to pay the personnel costs required during the month to complete the search and copying tasks.The personnel costs may not exceed the actual salary and benefit costs for the personnel time required to perform the search and copying tasks.The requester shall pay the fee before the records are disclosed,and the public agency may require payment in advance of the search. (d)A public agency may reduce or waive a fee when the public agency determines that the reduction or waiver is in the public interest.Fee reductions and waivers shall be uniformly applied among persons who are similarly situated.A public agency may waive a fee of $5 or less if the fee is less than the cost to the public agency to arrange for payment. (e)Notwithstanding other provisions of this section to the contrary,the Bureau of Vital Statistics and the library archives in the Department of Education and Early Development may continue to charge the same fees that they were charging on September 25,1990,for performing record searches,and may increase the fees as necessary to recover agency expenses on the same basis that was used by the agency immediately before September 25,1990.Notwithstanding other provisions ofthis section to the contrary,the Department of Commerce,Community,and Economic Development may continue to charge the same fees that the former Department of Commerce and Economic Development was charging on July 1,1999,for performing record searches for matters related to banking,securities,and corporations,and may increase the fees as necessary to recover agency expenses on the same basis that was used by the former Department of Commerce and Economic Development immediately before July 1,1999. (f)Notwithstanding other provisions of this section to the contrary,the Board of Regents of the University of Alaska may establish reasonable fees for the inspection and copying of public records, including record searches. (g)Notwithstanding other provisions of this section to the contrary,the board of directors of the Alaska Railroad Corporation may establish reasonable fees for the inspection and copying of public records,including record searches. (h)Notwithstanding other provisions of this section to the contrary,the judicial branch may establish by court rule reasonable fees for the inspection and copying of public records,including record searches. (i)Electronic information that is provided in printed form shall be made available without codes or symbols,unless accompanied by an explanation of the codes or symbols. Exhibit S-4 Page 2 of 9 Sec.40.25.115.Electronic services and products. (a)Notwithstanding AS 40.25.110(b)-(d)to the contrary,upon request and payment of a fee established under (b)of this section,a public agency may provide electronic services and products involving public records to members of the public.A public agency is encouraged to make information available in usable electronic formats to the greatest extent feasible.The activities authorized under this section may not take priority over the primary responsibilities of a public agency. (b)The fee for electronic services and products must be based on recovery of the actual incremental costs of providing the electronic services and products,and a reasonable portion of the costs associated with building and maintaining the information system of the public agency.The fee may be reduced or waived by the public agency if the electronic services and products are to be used for a public purpose,including public agency program support,nonprofit activities,journalism,and academic research.Fee reductions and waivers shall be uniformly applied among persons who are similarly situated. (c)Notwithstanding (b)of this section,the fee for duplicating a public record in the electronic form kept by a public agency may not exceed the actual incremental costs of the public agency. (d)Public agencies shall include in a contract for electronic services and products provisions that (1)protect the security and integrity of the information system of the public agency and of information systems that are shared by public agencies;and (2)limit the liability of the public agency providing the services and products. (e)Each public agency shall notify the state library distribution and data access center established under AS 14.56.090 of the electronic services and products offered by the public agency to the public under this section.The notification must include a summary of the available format options and the fees charged. (f)When offering on-line access to an electronic file or data base,a public agency also shall provide without charge on-line access to the electronic file or data base through one or more public terminals. (g)Each public agency shall establish the fees for the electronic services and products provided under this section.The governor may cancel the fees established by a public agency in the executive branch,except the fees of the University of Alaska and the Alaska Railroad Corporation,if the governor determines that the fees are unreasonably high. (h)A public agency may not make electronic services and products available to one member of the public and withhold them from other members of the public. (i)A public agency other than a municipality or the Alaska Railroad Corporation shall separately account for the fees received by the agency under this section and deposited in the general fund.The Exhibit S-4 Page 3 of 9 annual estimated balance in the account may be used by the legislature to make appropriations to the agency to carry out the activities of the agency. Sec.40.25.120.Public records;exceptions;certified copies. (a}Every person has a right to inspect a public record in the state,including public records in recorders'offices,except (1)records of vital statistics and adoption proceedings,which shall be treated in the manner required by AS 18.50; (2)records pertaining to juveniles unless disclosure is authorized by law; (3)medical and related public health records; (4)records required to be kept confidential by a federal law or regulation or by state law; (S)to the extent the records are required to be kept confidential under 20 U.S.C.1232g and the regulations adopted under 20 U.S.C.1232g in order to secure or retain federal assistance; (6)records or information compiled for law enforcement purposes,but only to the extent that the production of the law enforcement records or information (A)could reasonably be expected to interfere with enforcement proceedings; (B)would deprive a person of a right to a fair tria!or an impartial adjudication; (C)could reasonably be expected to constitute an unwarranted invasion of the personal privacy of a suspect,defendant,victim,or witness; (D)could reasonably be expected to disclose the identity of a confidential source; (E)would disclose confidential techniques and procedures for law enforcement investigations or prosecutions; (F)would disclose guidelines for law enforcement investigations or prosecutions if the disclosure could reasonably be expected to risk circumvention of the law;or (G)could reasonably be expected to endanger the life or physical safety of an individual; (7)names,addresses,and other information identifying a person as a participant in the Alaska Higher Education Savings Trust under AS 14.40.802 or the advance college tuition savings program under AS 14.40.803 -14.40.817; (8)public records containing information that would disclose or might lead to the disclosure of a component in the process used to execute or adopt an electronic signature if the disclosure would or might cause the electronic signature to cease being under the sole control of the person using it; Exhibit S-4 Page 4 of 9 (9)reports submitted under AS 05.25.030 concerning certain collisions,accidents,or other casualties involving boats; (10)records or information pertaining to a plan,program,or procedures for establishing, maintaining,or restoring security in the state,or to a detailed description or evaluation of systems, facilities,or infrastructure in the state,but only to the extent that the production of the records or information (A)could reasonably be expected to interfere with the implementation or enforcement of the security plan,program,or procedures; (B)would disclose confidential guidelines for investigations or enforcement and the disclosure could reasonably be expected to risk circumvention ofthe law;or (C)could reasonably be expected to endanger the life or physical safety of an individual or to present a real and substantial risk to the public health and welfare; (11)the written notification regarding a proposed regulation provided under AS 24.20.105 to the Department of Law and the affected state agency and communications between the Legislative Affairs Agency,the Department of Law,and the affected state agency under AS 24.20.105; (12)records that are (A)proprietary,privileged,or a trade secret in accordance with AS 43.90.150 or 43.90.220(e); (B)applications that are received under AS 43.90 until notice is published under AS 43.90.160; (13)information of the Alaska Gasline Development Corporation created under AS 31.25.010 or a subsidiary of the Alaska Gasline Development Corporation that is confidential by Jaw or under a valid confidentiality agreement; (14)information under AS 38.05.020(b)(11)that is subject to a confidentiality agreement under AS 38.05.020(b)(12). (b)Every public officer having the custody of records not included in the exceptions shall permit the inspection,and give on demand and on payment of the fees under AS 40.25.110 -40.25.115 a certified copy of the record,and the copy shall in all cases be evidence ofthe original. (c}Recorders shall permit memoranda,transcripts,and copies of the public records in their offices to be made by photography or otherwise for the purpose of examining titles to real estate described in the public records,making abstracts of title or guaranteeing or insuring the titles of the real estate,or building and maintaining title and abstract plants,subject to reasonable rules and regulations as are necessary for the protection of the records and to prevent interference with the regular discharge of the duties of the recorders and their employees. Exhibit S-4 Page 5o0f 9 Sec.40.25.121.Copies of public records for veterans. When a copy of a public record is required by the Department of Military and Veterans'Affairs,the Department of Commerce,Community,and Economic Development,or by the United States Department of Veterans Affairs to be used in determining the eligibility of a person to participate in benefits,the official custodian of the public record shall,without charge,provide the applicant for the benefits,a person acting on behalf of the applicant,or an authorized representative of the department or the United States Department of Veterans Affairs with a certified copy of the record. Sec.40.25.122.Litigation disclosure. A public record that is subject to disclosure and copying under AS 40.25.110 -40.25.120 remains a public record subject to disclosure and copying even if the record is used for,included in,or relevant to litigation,including law enforcement proceedings,involving a public agency,except that with respect to a person involved in litigation,the records sought shall be disclosed in accordance with the rules of procedure applicable in a court or an administrative adjudication.In this section,"involved in litigation" means a party to litigation or representing a party to litigation,including obtaining public records for the party. Sec.40.25.123.Supervision and regulation. (a)The Department of Administration shall supervise and adopt regulations for the operation and implementation of AS 40.25.110 -40.25.140 by public agencies in the executive branch,except the Alaska Railroad Corporation. (b)The legislative council shall supervise and adopt procedures for the operation and implementation of AS 40.25.110 -40.25.140 by public agencies in the legislative branch. (c}The administrative director of the Alaska Court System shall supervise and adopt procedures for the operation and implementation of AS 40.25.110 -40.25.140 by public agencies in the judicial branch. (d)The Board of Regents of the University of Alaska shall supervise and adopt procedures for the operation and implementation of AS 40.25.110 -40.25.140 by the University of Alaska. (e)The regulations and procedures adopted under this section must include the establishment of procedures for making an administrative appeal of public agency action that is taken under AS 40.25.110 -40.25.140. (f)In this section, (1)"action"includes the calculation of a fee,the denial of a fee reduction or waiver,and the denial of a request to inspect or copy a public record; (2)"public agency"does not include a municipality. Exhibit S-4 Page 6 of 9 Sec.40.25.124.Appeals. A person may appeal to the superior court the final administrative order made by a public agency under AS 40.25.110 -40.25.140. Sec.40.25.125.Enforcement:Injunctive relief. A person having custody or control of a public record who denies,obstructs,or attempts to obstruct,or a person not having custody or control who aids or abets another person in denying,obstructing,or attempting to obstruct,the inspection of a public record subject to inspection under AS 40.25.110 or 40.25.120 may be enjoined by the superior court from denying,obstructing,or attempting to obstruct, the inspection of public records subject to inspection under AS 40.25.110 or 40.25.120.A person may seek injunctive relief under this section without exhausting the person's remedies under AS 40.25.123 - 40.25.124. Sec.40.25.140.Confidentiality of library records. (a)Except as provided in (b)of this section,the names,addresses,or other personal identifying information of people who have used materials made available to the public by a library shall be kept confidential,except upon court order,and are not subject to inspection under AS 40.25.110 or 40.25.120.This section applies to libraries operated by the state,a municipality,or a public school, including the University of Alaska. (b)Records of a public elementary or secondary school library identifying a minor child shall be made available on request to a parent or guardian ofthat child. Sec.40.25.151.Confidentiality of retirement records. (a)Except as provided in (b)-(d)of this section,public records,including electronic services and products involving public records,containing information about a person and maintained under AS 14.25,AS 22.25,AS 26.05.222 -26.05.229,AS 39.35,or former AS 39.37 shall be kept confidential and are not subject to inspection or copying under AS 40.25.110 -40.25.120. (b)Records described in (a)of this section concerning a person who is a member or former member of a state retirement system who is still living may only be released to (1)the person or the person's guardian; (2)the person's employer or former employer; (3)a state agency authorized to obtain confidential information; (4)another person if the person has (A)written authorization for release from the affected member or former member or the member's or former member's guardian;or Exhibit S-4 Page 7 of 9 (B)a court order or subpoena to obtain the information. (c)Records described in (a)of this section concerning a member or former member of a state retirement system who is deceased or a deceased member's named beneficiary may only be released to (1)the member's named beneficiary or the beneficiary's guardian; (2)the member's or former member's former employer; (3)a state agency authorized to obtain confidential information; (4)the personal representative of the member's or former member's estate; (5)another person if the person has (A)written authorization for release from the member or former member,the member's named beneficiary,or the personal representative of the member's or former member's estate;or (B)a court order or subpoena to secure the information. (d)The name and address of a living person who is a member or former member of a state retirement system may be released to a retirement organization representing persons receiving benefits under a state retirement system if the retirement organization is affiliated with an organization representing employees of the employer under AS 23.40.070 -23.40.260 (Public Employment Relations Act). (e)In this section,"state retirement system"means the teachers'retirement system under AS 14.25,the judicial retirement system under AS 22.25,the retirement system for members of the national guard under AS 26.05.222 -26.05.229,the public employees'retirement system under AS 39.35,or the elected public officers retirement system under former AS 39.37. Sec.40.25.220.Definitions for AS 40.25.100 -40.25.295. In AS 40.25.100 -40.25.295,unless the context otherwise requires, (1)"electronic services and products"means computer-related services and products provided by a public agency,including (A)electronic manipulation of the data contained in public records in order to tailor the data to the person's request or to develop a product that meets the person's request; (B)duplicating public records in alternative formats not used by a public agency,providing periodic updates of an electronic file or data base,or duplicating an electronic file or data base from a geographic information system; (C)providing on-line access to an electronic file or data base; Exhibit S-4 Page 8 of 9 (D)providing information that cannot be retrieved or generated by the existing computer programs of the public agency; (E)providing functional electronic access to the information system of the public agency;in this subparagraph,"functional access"includes the capability for alphanumeric query and printing,graphic query and plotting,nongraphic data input and analysis,and graphic data input and analysis; (F)providing software developed by a public agency or developed by a private contractor for a public agency; (G)generating maps or other standard or customized products from an electronic geographic information system; (2)"public agency"means a political subdivision,department,institution,board,commission, division,authority,public corporation,council,committee,or other instrumentality of the state or a municipality;"public agency"includes the University of Alaska and the Alaska Railroad Corporation; (3)"public records"means books,papers,files,accounts,writings,including drafts and memorializations of conversations,and other items,regardless of format or physical characteristics,that are developed or received by a public agency,or by a private contractor for a public agency,and that are preserved for their informational value or as evidence of the organization or operation of the public agency;"public records"does not include proprietary software programs. Sec.40.25.295.Short title. AS 40.25.100 -40.25.295 may be cited as the Alaska Public Records Act. Exhibit S-4 Page 9 of 9 Exhibit S-5 Sec.44.62.310.Government meetings public. (a)All meetings of a governmental body of a public entity of the state are open to the public except as otherwise provided by this section or another provision of law.Attendance and participation at meetings by members of the public or by members of a governmental body may be by teleconferencing.Agency materials that are to be considered at the meeting shall be made available at teleconference locations if practicable.Except when voice votes are authorized,the vote shall be conducted in such a manner that the public may know the vote of each person entitled to vote.The vote at a meeting held by teleconference shall be taken by roll call.This section does not apply to any votes required to be taken to organize a governmental body described in this subsection. (b)If permitted subjects are to be discussed at a meeting in executive session,the meeting must first be convened as a public meeting and the question of holding an executive session to discuss matters that are listed in (c)of this section shall be determined by a majority vote of the governmental body.The motion to convene in executive session must clearly and with specificity describe the subject of the proposed executive session without defeating the purpose of addressing the subject in private. Subjects may not be considered at the executive session except those mentioned in the motion calling for the executive session unless auxiliary to the main question.Action may not be taken at an executive session,except to give direction to an attorney or labor negotiator regarding the handling of a specific legal matter or pending labor negotiations. (c)The following subjects may be considered in an executive session: (1)matters,the immediate knowledge of which would clearly have an adverse effect upon the finances ofthe public entity; (2)subjects that tend to prejudice the reputation and character of any person,provided the person may request a public discussion; (3)matters which by law,municipal charter,or ordinance are required to be confidential; (4)matters involving consideration of government records that by law are not subject to public disclosure. (d)This section does not apply to (1)a governmental body performing a judicial or quasi-judicial function when holding a meeting solely to make a decision in an adjudicatory proceeding; (2)juries; (3)parole or pardon boards; (4)meetings of a hospital medical staff; Exhibit S-5 Page 1 of4 (5)meetings of the governmental body or any committee of a hospital when holding a meeting solely to act upon matters of professional qualifications,privileges,or discipline; (6)staff meetings or other gatherings of the employees of a public entity,including meetings of an employee group established by policy of the Board of Regents of the University of Alaska or held while acting in an advisory capacity to the Board of Regents; (7)meetings held for the purpose of participating in or attending a gathering of a national,state, or regional organization of which the public entity,governmental body,or member of the governmental body is a member,but only if no action is taken and no business of the governmental body is conducted at the meetings;or (8)meetings of municipal service area boards established under AS 29.35.450 -29.35.490 when meeting solely to act on matters that are administrative or managerial in nature. (e}Reasonable public notice shall be given for all meetings required to be open under this section.The notice must include the date,time,and place of the meeting and if,the meeting is by teleconference,the location of any teleconferencing facilities that will be used.Subject to posting notice of a meeting on the Alaska Online Public Notice System as required by AS 44.62.175(a),the notice may be given using print or broadcast media.The notice shall be posted at the principal office of the public entity or,if the public entity has no principal office,at a place designated by the governmental body.The governmental body shall provide notice in a consistent fashion for all its meetings. (f)Action taken contrary to this section is voidable.A lawsuit to void an action taken in violation of this section must be filed in superior court within 180 days after the date of the action.A member of a governmental body may not be named in an action to enforce this section in the member's personal capacity.A governmental body that violates or is alleged to have violated this section may cure the violation or alleged violation by holding another meeting in compliance with notice and other requirements of this section and conducting a substantial and public reconsideration of the matters considered at the original meeting.If the court finds that an action is void,the governmental body may discuss and act on the matter at another meeting held in compliance with this section.A court may hold that an action taken at a meeting held in violation of this section is void only if the court finds that, considering all of the circumstances,the public interest in compliance with this section outweighs the harm that would be caused to the public interest and to the public entity by voiding the action.In making this determination,the court shall consider at least the following: (1)the expense that may be incurred by the public entity,other governmental bodies,and individuals if the action is voided; (2)the disruption that may be caused to the affairs of the public entity,other governmental bodies,and individuals if the action is voided; (3)the degree to which the public entity,other governmental!bodies,and individuals may be exposed to additional litigation if the action is voided; Exhibit S-5 Page 2 of4 (4)the extent to which the governing body,in meetings held in compliance with this section,has previously considered the subject; (5)the amount of time that has passed since the action was taken; (6)the degree to which the public entity,other governmental bodies,or individuals have come to rely on the action; (7)whether and to what extent the governmental body has,before or after the lawsuit was filed to void the action,engaged in or attempted to engage in the public reconsideration of matters originally considered in violation of this section; (8)the degree to which violations of this section were wilful,flagrant,or obvious; (9)the degree to which the governing body failed to adhere to the policy under AS 44.62.312(a). (g)Subsection (f)of this section does not apply to a governmental body that has only authority to advise or make recommendations to a public entity and has no authority to establish policies or make decisions for the public entity. (h)In this section, (1)"governmental body"means an assembly,council,board,commission,committee,or other similar body of a public entity with the authority to establish policies or make decisions for the public entity or with the authority to advise or make recommendations to the public entity;"governmental body"includes the members of a subcommittee or other subordinate unit of a governmental bodyif the subordinate unit consists of two or more members; (2)"meeting”means a gathering of members of a governmental body when (A)more than three members or a majority of the members,whichever is less,are present,a matter upon which the governmental body is empowered to act is considered by the members collectively,and the governmental body has the authority to establish policies or make decisions for a public entity;or (B)more than three members or a majority of the members,whichever is less,are present,the gathering is prearranged for the purpose of considering a matter upon which the governmental body is empowered to act,and the governmental body has only authority to advise or make recommendations for a public entity but has no authority to establish policies or make decisions for the public entity; (3)"public entity"means an entity of the state or of a political subdivision of the state including an agency,a board or commission,the University of Alaska,a public authority or corporation,a municipality,a school district,and other governmental units of the state or a political subdivision of the state;it does not include the court system or the legislative branch of state government. Exhibit S-5 Page 3 of 4 Sec.44.62.312.State policy regarding meetings. (a)It is the policy of the state that (1)the governmental units mentioned in AS 44.62.310(a)exist to aid in the conduct of the people's business; (2)it is the intent of the law that actions of those units be taken openly and that their deliberations be conducted openly; (3)the people of this state do not yield their sovereignty to the agencies that serve them; (4)the people,in delegating authority,do not give their public servants the right to decide what is good for the people to know and what is not good for them to know; (5)the people's right to remain informed shall be protected so that they may retain control over the instruments they have created; (6)the use of teleconferencing under this chapter is for the convenience of the parties,the public,and the governmental units conducting the meetings. (b)AS 44.62.310(c)and (d)shall be construed narrowly in order to effectuate the policy stated in (a)of this section and to avoid exemptions from open meeting requirements and unnecessary executive sessions. Sec.44.62.319.Short title. AS 44.62.310 -44.62.319 may be cited as the Open Meetings Act. Exhibit S-5 Page 4 of 4 Exhibit S-6 Sec.42.05.431.Power of commission to fix rates. (b)A wholesale power agreement between public utilities is subject to advance approval of the commission.After a wholesale power agreement is in effect,the commission may not invalidate any purchase or sale obligation under the agreement.However,if the commission finds that rates set in accordance with the agreement are not just and reasonable,the commission may order the parties to negotiate an amendment to the agreement and if the parties fail to agree,to use the dispute resolution procedures contained in the contract. (c)Notwithstanding (b)of this section, (1)a wholesale agreement for the sale of power from a project licensed by the Federal Energy Regulatory Commission on or before January 1,1987,and related contracts for the wheeling,storage, regeneration,or wholesale repurchase of power purchased under the agreement,entered into between the Alaska Energy Authority and one or more other public utilities or among the utilities after October 31,1987,and before January 1,1988,and amendments to the wholesale agreement or related contract, and the wholesale agreement or related contract assigned by the Alaska Energy Authority to a joint action agency formed under AS 42.45.310 that purchases the project from the Alaska Energy Authority, are not subject to review or approval by the commission until all long-term debt incurred for the project is retired,or,for a wholesale agreement or related contract assigned to a joint action agency formed under AS 42.45.310,until all long-term debt incurred to pay the purchase price to the Alaska Energy Authority is retired;and (2)a wholesale agreement or related contract described in (1)of this subsection may contain a covenant for the public utility to establish,charge,and collect rates sufficient to meet its obligations under the contract;the rate covenant is valid and enforceable. (d)Meetings between the Alaska Energy Authority and public utilities concerning a wholesale agreement for the sale of power or other matter exempted from review of the commission under (c)of this section must comply with AS 44.62.310. (e)Validated costs incurred by a utility in connection with the related contracts described in (c)(1)of this section must be allowed in the rates charged by the utility.In this subsection,"validated costs"are the actual costs that a utility uses,under the formula set out in related contracts described in (c)of this section,to establish rates,charges for services and rights,and the payment of charges for services and rights.This subsection does not grant the commission jurisdiction to alter or amend the formula set out in those related contracts. Exhibit s-6 Page 1 of 1 Exhibit S-7 Chapter 37.07.EXECUTIVE BUDGET ACT Sec.37.07.010.Statement of policy. It is the purpose of this chapter to establish a comprehensive system for state program and financial management that furthers the capacity of the governor and legislature to plan and finance the services that they determine the state will provide for its citizens.The system must include procedures for (1)the orderly establishment,continuing review,and periodic revision of the program goals and policies of state agencies and financial goals and policies of the state; (2)the development,coordination,and review of long-range program and financial plans that will implement established state goals and policies; (3)the preparation,coordination,analysis,and enactment of a budget that is organized to focus on the services provided by state agencies and on the cost of those services and that provides for implementation of policies and plans,in the succeeding budget period; (4)the evaluation of alternatives to existing policies,plans,and procedures that offer potential for more efficient state services; (5)the regular appraisal and reporting of program performance; (6)public participation in the development of the annual budget,including opportunity for the public to review and comment upon the plans and programs of the Office of the Governor and all state agencies in the executive branch,the legislature,the judicial system,the University of Alaska,and the public corporations ofthe state. Sec.37.07.014.Responsibilities of the legislature. (a)To carry out its legislative power under art.Il,sec.1,Constitution of the State of Alaska,and to promote results-based government,the legislature shall issue a mission statement for each agency and the desired results the agency should achieve.The legislature may issue a separate mission statement for a subunit of an agency.A mission statement and desired results should promote the efficient,measured use of the state's resources.A mission statement and desired results constitute policy under which an agency shall operate,and,where appropriate,the mission statement may be implemented by statute. (b)The legislature shall provide for a budget review function that promotes results-based government.The legislature shall adopt a method of measuring results for each agency,and measurements shall be reported semi-annually by each agency to the legislature.The reports shall be used by the legislature to evaluate whether the mission and desired results for that agency or subunit of the agency are being achieved. Exhibit S-7 Page 1 of 13 (c)The legislature shall analyze the comprehensive operating and capital improvements programs and financial plans recommended by the governor. (d)To foster results-based government,to carry out the mission statements,and to obtain desired results,the legislature shall authorize the comprehensive operating and capital improvements programs and financial plans.The legislature shall allocate the state's resources for effective and efficient delivery of public services by (1)clearly identifying desired results; (2)setting priorities; (3)assigning accountability;and (4)using methods for measuring,reporting,and evaluating results. (e)The legislature shall (1)provide for a post-audit function to cover financial transactions,program accomplishment, and compliance with legislative intent; (2)adopt or revise the estimate of receipts required to balance the succeeding fiscal year's budget in order that proposed expenditures do not exceed estimated receipts for that fiscal year; (3)adopt,revise,or initiate revenue measures in order to balance the succeeding fiscal year's budget and the capital improvements section of the budget for the succeeding six years. (f)To help fulfill the legislature's responsibilities under this section and achieve results-based government,each agency shall (1)allocate resources to achieve the mission and desired results established by the legislature; (2)express desired results established by the legislature and other program results in measurable terms; (3)measure progress towards mission statements and desired results established by the legislature and other results; (4)promote activities consistent with mission statements and desired results established by the legislature that reduce or avoid future costs; (5S)plan for the short-term and the long-term using consistent assumptions for major demographic and other trends;and (6)require accountability at all levels for meeting program mission statements and desired results established by the legislature. Exhibit S-7 Page 2 of 13 Sec.37.07.016.Governor's use of mission statements. To carry out the executive power under art.Ill,sec.1 and sec.16,Constitution of the State of Alaska,the governor shall use the mission statements and desired results issued by the legislature as a guide to implement and execute the law.The governor shall assure that each agency complies with the mission statement and achieves the desired results identified by the legislature. Sec.37.07.020.Responsibilities of the governor. (a)The governor shall prepare a budget for the succeeding fiscal year that must cover all estimated receipts,including all grants,loans,and money received from the federal government and all proposed expenditures of the state government.The budget shall be organized so that the proposed expenditures for each agency are presented separately.The budget must be accompanied by the information required under AS 37.07.050 and by the following separate bills:(1)an appropriation bill authorizing the operating and capital expenditures of the state's integrated comprehensive mental health program under AS 37.14.003(a);(2)an appropriation bill authorizing state operating expenditures other than those included in the state's integrated comprehensive mental health program;(3)an appropriation bill authorizing capital expenditures other than those included in the state's integrated comprehensive mental health program;and (4)a bill or bills covering recommendations,if any,in the budget for new or additional revenue.The budget for the succeeding fiscal year and each of the bills shall become public information on December 15 at which time the governor shall submit copies to the legislature and make copies available to the public.The bills,identical in content to the copies released on December 15,shall be delivered to the rules committee of each house before the fourth legislative day of the next regular session for introduction. (b)In addition to the budget and bills submitted under (a)of this section,the governor shall submit a capital improvements program covering the succeeding six fiscal years.The governor shall also submit a fiscal plan with estimates of significant sources and uses of funds for the succeeding 10 fiscal years.The fiscal plan (1)must include sufficient details to identify (A)significant sources of funds; (B)significant uses of funds,including lump sum projections of {i)operating expenditures; (ii)capital expenditures; (iii)debt service expenditures; (iv)fund capitalizations; (v)appropriations of income of the Alaska permanent fund (art.IX,sec.15,Constitution of the State of Alaska),if any; Exhibit S-7 Page 3 of 13 (2)must balance sources and uses of funds held while providing for essential state services and protecting the economic stability of the state; (3)must include projected balances of significant funds held in separate accounts,including the budget reserve fund (art.IX,sec.17,Constitution of the State of Alaska),the public education fund (AS 14.17.300),and the Alaska capital income fund (AS 37.05.565); (4)must set out significant assumptions used in the projections with sufficient detail to enable the legislature to rely on the fiscal plan in understanding,evaluating,and resolving issues of state budgeting,including information that supports major areas of operating increases,such as population demographics that affect the need for particular government services. (c)Proposed expenditures may not exceed estimated revenue for the succeeding fiscal year.The expenditures proposed in the six-year capital improvements program may not exceed the estimated revenue and bond authorizations passed and proposed. (d)[Repealed,Sec.35 ch 126 SLA 1994). (e)The budget prepared under (a)of this section must present the proposed operating expenditures for each agency for annual facility operations,annual maintenance and repair,and periodic renewal and replacement for components of public buildings and facilities separately from the other proposed operating expenditures by the agency.Proposed annual appropriations for an agency's facility operations,maintenance and repair,and renewal and replacement for components of public buildings and facilities contained in an appropriation bill prepared under (a)of this section must be presented separately from appropriations for other proposed operating expenditures by the agency. Sec.37.07.030.Responsibilities of the legislature.[Repealed,Sec.9 ch 27 SLA 1998]. Repealed or Renumbered Sec.37.07.040.Office of management and budget. The Alaska office of management and budget shall (1)assist the governor in meeting the requirements of AS 37.07.020,including the coordination and analysis of state agency goals and objectives,plans,and budget requests; (2)prepare for submission to the governor an annually updated six-year capital improvements program and the proposed capital improvements budget for the coming fiscal year,the latter to include individual project justification with documentation of estimated project cost; (3)develop procedures to produce the information needed for effective policy decision making, including procedures to provide for the dissemination of information about plans,programs,and budget requests to be included in the annual budget and opportunity for public review and comment during the period of budget preparation; Exhibit S-7 Page 4 of 13 (4)assist state agencies in their statement of goals and objectives to achieve,among other things,the legislature's mission and desired results,preparation of plans,assessments of the extent to which missions and desired results have been achieved,budget requests,and reporting of program performance;all documents forwarded by the office to a state agency containing instructions for the preparation of program plans and budget requests and the reporting of program performance are public information after the date they are forwarded; (5)administer its responsibilities under the program execution provisions of this chapter so that the policy decisions and budget determinations of the governor and the legislature are implemented; (6)provide the legislative finance division with the budget information it may request; (7)provide the legislative finance division with an advance copy of the governor's budget workbooks at least seven days before the legislature convenes in a regular session; (8)prepare the proposed capital improvements budget for the coming fiscal year evaluating both state and local requests from the standpoint of need,equity,and priorities of the jurisdiction; other factors such as project amounts,population,local financial match,federal funds being used for local match,municipality or unincorporated community acceptance of the facility,and all associated costs of the facility may be considered; (9)for each department in the executive branch,report to the legislature by the 45th day of each regular session the amount of money appropriated to the department that is expected to lapse into the general fund at the end of the current fiscal year; (10)establish and administer a state agency program performance management system involving planning,performance budgeting,performance measurement,and program evaluation;the office shall ensure that information generated under this system is useful for managing and improving the efficiency and effectiveness of agency operations; (11)by January 15,list each lease-purchase agreement entered into by an agency during the immediately preceding fiscal year for the acquisition of equipment or other personal property,together with a description of the property acquired and financial details,including the purchase price,the term for payments,the amount of each payment,and the amount of interest or financing charges paid; (12)work with state agencies to develop a standardized methodology to collect and store energy consumption and expense data. Sec.37.07.045.Debt affordability analysis. The Department of Revenue shall prepare a report that includes an inventory of state bonded debt,an estimate of state bonded debt that will be acquired within the next three years,and an evaluation of debt affordability.The report must conform to rating agency requirements for a debt affordability study. By January 31 each year,the report must be provided to the legislature for use in budget planning and made available to the public. Exhibit S-7 Page 5 of 13 Sec.37.07.050.Agency program and financial plans;mission statements. (a)The agencies shall assure the development of a statewide system of results-based government designed to increase efficiency and effectiveness of state programs and services.Toward that end,each state agency shall,on a semi-annual basis,identify results-based measures that have been used to work toward achievement of the mission statement and desired results issued by the legislature and of other goals of the agency,and set out the results as measured.Each state agency shall also prepare information that shall be compiled and submitted on December 15 each year to the office, the legislature,and the legislative finance division;this information must (1)identify the agency mission and desired results established by the legislature; (2)identify the goals and objectives the agency will use to achieve the legislature's mission and desired results; (3)set out the results of any user group surveys and,if the results do not agree with the mission and desired results,goals,and objectives,explain why; (4)include written,defined methods of measuring results that apply to the responsibilities, products,and services of the agency; (5S)identify results-based measures that have been used to work toward achievement of the mission statement and desired results issued by the legislature and other goals of the agency and set out the results as measured; (6)identify surveys or other methods of gathering user group opinions that have been used by the agency to identify ways to improve its programs; (7)identify methods of measuring performance when the mission statement and desired results issued by the legislature involve more than one agency and make recommendations to eliminate duplication of government functions and waste; (8)identify ways in which the agency has involved its employees in the development of methods of measuring results,including opportunities for employee representatives to participate in committees established to develop methods of measuring results; (9)include the budget requested to carry out the agency's proposed plans in the succeeding fiscal year,including information reflecting the expenditures during the last fiscal year,the expenditures authorized for the current fiscal year,the expenditures proposed for the succeeding fiscal year,an explanation of the services to be provided,the number of total positions for all persons employed or under contract by the agency for personal services including those rendered for capital improvement projects,the need for the services,the cost of the services,and other information requested by the office; Exhibit S-7 Page 6 of 13 (10)include a report of agency receipts during the last fiscal year,an estimate of receipts during the current fiscal year,and an estimate of receipts for the succeeding fiscal year; (11)identify legislation required to implement the proposed programs and financial plans; (12)include an evaluation of the advantages and disadvantages of specific alternatives to existing or proposed agency activities or administrative methods; (13)prioritize the activities of the agency from the most important to the least important. (b)The state agency proposals prepared under (a)of this section must describe the relationships of their program services to those of other agencies,of other governments,and of nongovernmental bodies. (c)The office shall assist agencies in the preparation of their proposals under (a)of this section. This assistance may include technica!assistance,organization of materials,centrally collected accounting,budgeting and personnel information,standards and guidelines formulation,population and other required data,and any other assistance that will help the state agencies produce the information necessary for efficient agency management and effective decision-making by the governor and the legislature. (d)If any state agency fails to transmit the program and financial information provided under (a) of this section on the specified date,the office may prepare the information. (e)The office shall compile and submit to the governor-elect in any year when a new governor has been elected,not later than November 20,a summary of the program and financial information prepared by state agencies. (f)Budget requests for boards and commissions and for those agency programs for the fiscal year following termination under AS 44.66 shall be prepared and submitted.The recommended appropriation request must include (1)an identification of the objectives intended for the program and the problem or need that the activities and operations of the board,commission,or program is intended to address; (2)an assessment of the degree to which the original objectives of the program have been achieved expressed in terms of performance,effects,or accomplishments of the program and of the program or need that it was intended to address; (3)a statement of the performance and accomplishments of the program in each of the last four completed fiscal years and of the costs incurred in the operation of the program; (4)a statement of the number and types of persons affected by operation of the program; Exhibit S-7 Page 7 of 13 (5)a summary statement,for each of the last three completed fiscal years,of the number of personnel employed in carrying out the program and a summary of the cost of personnel employed under contract in carrying out the program; (6)an assessment ofthe effect of the program on the economyof the state; (7)an assessment of the degree to which the overall policies of the program,as expressed in regulations adopted by the agency,board,or commission and its decisions,meet the objectives of the legislature in establishing the program; (8)an analysis of the services and performance estimated to be achieved ifthe life of the agency,board,or commission were to be continued; (9)a prioritized list of the activities the agency,board,or commission would be expected to perform if the life of the agency,board,or commission were to be continued,from the most important to the least important. (g)All goals and objectives,plans,programs,estimates,budgets,and other documents forwarded to the office of management and budget by a state agency under this section are public information after the date they are forwarded. (h)Each agency shall,with participation of its employees,develop methods for measuring agency results.A group or committee established by an agency to develop methods of measuring results shall include a representative of each of the bargaining units that represents employees of the agency. Sec.37.07.060.Governor's recommendation. (a)The governor shall formulate the operating and capital budget,capital improvements program,and fiscal plan required to be recommended to the legislature by AS 37.07.020 after considering the state agency proposed program and financial plans prepared in accordance with AS 37.07.050,and other programs and alternatives that the governor considers appropriate.The plans must include the governor's recommended missions and results,recommended strategies to implement the missions and results,recommended measures for determining whether the missions and desired results are achieved,including an assessment of whether prior year missions and desired results have been achieved,recommended operating program for the succeeding fiscal year,recommended capital improvements program for the succeeding six fiscal years,recommended programs for the upgrading of public buildings and facilities prepared in accordance with AS 35.10.015,and recommended revenue measures to support the programs. (b)The governor shall present the proposed comprehensive operating and capital improvements programs,and fiscal plan if it is required under AS 37.07.020(b),in a message to a joint session of the legislature before the fourth legislative day following the convening of the legislature in Exhibit S-7 Page 8 of 13 regular session.The message must be accompanied by an explanatory report that summarizes recommended goals,plans,and appropriations.The report must contain (1)the coordinated program goals and objectives that the governor recommends to guide the decisions on the proposed program plans and budget appropriations; (2)the governor's operating program and budget recommendations for the succeeding fiscal year organized by agency as required by AS 37.07.020(a); (3)the governor's capital improvements program and budget recommendations for the succeeding fiscal year and capital improvements program for the succeeding six fiscal years,which must include (A)a description of each project,its estimated cost for the year construction is to start and the estimated cost of the project adjusted for inflation over the estimated period of construction,and the source of financing for the project;the project description for a new building or a new facility or fora major addition to a building or facility should include a site plan,preliminary drawings,and architect's or engineer's total cost estimate for the project; (B)asummary of projects previously authorized and not yet completed; (C)asummary,listed by agency,of all previously proposed projects that have been deferred beyond the six years covered by the plan and the year in which construction has been rescheduled to begin; (D)a forecast of the debt structure of the state and the various debt ratios over the life of the state's bonds outstanding,bonds authorized and to be issued,and bond authorizations recommended in the plan; (E)a description of additional revenue measures needed to finance the plan in lieu of debt; (F)bond election bills to authorize the bonds required to fund the projects scheduled for the first three years of the plan; (G)projections of population of the state and its regions and communities; (H)economic data and projections necessary for the evaluation of the plan; (4)a summary of state receipts in the last fiscal year,a revised estimate for the current fiscal year,and an estimate for the succeeding fiscal year; (5)asummary of expenditures during the last fiscal year,those authorized for the current fiscal year,and an estimate for the succeeding fiscal year; (6)any additional information that will facilitate understanding of the governor's proposed programs and financial plans by the legislature and the public. Exhibit S-7 Page 9 of 13 Sec.37.07.062.Capital budget. (a)Each appropriation bill authorizing capital expenditures required to be submitted to the legislature in AS 37.07.020(a)must be accompanied by documents supporting the expenditures.The documents must list,for each project,the (1)project identification number; (2)project title; (3)source of funding; (4)amount expended on the project during the preceding fiscal year,the amount authorized for the current fiscal year,the amount proposed to be expended during the succeeding fiscal year,and the amount proposed to be expended each year until project completion; (5)estimated start for construction; (6)cost of each subsequent phase with estimated construction start and completion dates,for projects that will be completed in phases;and (7)schedule of bond elections pertaining to the appropriation,including elections previously held. (b)[Repealed,Sec.19 ch 61 SLA 2014]. (c)[Repealed,Sec.19 ch 61 SLA 2014]. (d)[Repealed,Sec.19 ch 61 SLA 2014]. Sec.37.07.070.Legislative review. The legislature shall consider the governor's proposed comprehensive operating and capital improvements programs,and fiscal plan if it is required under AS 37.07.020(b),evaluate alternatives to the plans,make program selections among the various alternatives,and determine,subject to available revenues,the level of funding required to support authorized state services.The presiding officer of each house may refer the fiscal plan to one or more committees.If the fiscal plan is referred,the first committee of referral shall hold at least one hearing on it.The operating and capital budgets of each agency shall be separately reviewed.During each regular session ofthe legislature,legislative review of the governor's supplemental appropriation bills and the governor's budget amendments are governed by the following time limits: (1)requests by the governor for supplemental appropriations for state agency operating and capital budgets for the current fiscal year may be introduced by the rules committee only through the 15th legislative day; Exhibit S-7 Page 10 of 13 (2)requests by the governor for budget amendments to state agency budgets for the budget fiscal year may be received and reviewed by the finance committees only through the 30th legislative day. Sec.37.07.080.Program execution. (a)Except as limited by executive decisions of the governor,the mission statements and desired results issued by the legislature,appropriations by the legislature,and other provisions of law,the several state agencies have full authority for administering their program service assignments and are responsible for their proper management. (b)Each state agency shall prepare an annual plan for the operation of each of its assigned programs except for programs that are exempted from this requirement by the office.The operations plan shall be prepared in the form and content and be transmitted on the date prescribed by the office. (c)The office shall (1)review each operations plan to determine that it is consistent with the executive decisions of the governor,the mission statement and desired results issued by the legislature,appropriations by the legislature,and other provisions of law,that it reflects proper planning and efficient management methods,and that appropriations have been made for the legislatively established purpose and will not be exhausted before the end of the fiscal year; (2)approve the operations plan if satisfied that it meets the requirements under (1)of this subsection;otherwise,the office shall require revision of the operations plan in whole or in part. (d)A state agency may not increase the salaries of its employees,employ additional employees, or expend money or incur obligations except in accordance with law and a properly approved operations plan. (e}Transfers or changes between objects of expenditures or between allocations may be made by the head of an agency upon approval of the office.Transfers may not be made between appropriations,including transfers made through the use of a reimbursable service agreement or other agreement,except as provided in an act making the transfers between appropriations.However,a reimbursable service agreement or other agreement may be used to finance the provision of a service if (1)the agency that requires the service has,by law,the authority to obtain or provide the service and has an appropriation that may be used for that purpose;and (2)the agency that provides the service bills the agency administering the available funds based on (A)the actual cost to provide the service;or (B)a cost allocation method approved by the office. Exhibit S-7 Page 11 of 13 (f)The office shall report quarterly to the governor and the legislature on the operations of each state agency,relating actual accomplishments to those planned and modifying,if necessary,the operations plan of any agency for the balance of the fiscal year. (g)The governor may direct the withholding or reduction of appropriations to a state agency at any time during the fiscal year only if the governor determines that the planned expenditures can no longer be made due to factors outside the control of the state which make the expenditure factually impossible. (h)The increase of an appropriation item based on additional federal or other program receipts not specifically appropriated by the full legislature may be expended in accordance with the following procedures: (1)the governor shall submit a revised program to the Legislative Budget and Audit Committee for review; (2)45 days shall elapse before commencement of expenditures under the revised program unless the Legislative Budget and Audit Committee earlier recommends that the state take part in the federally or otherwise funded activity; (3)should the Legislative Budget and Audit Committee recommend within the 45-day period that the state not initiate the additional activity,the governor shall again review the revised program and if the governor determines to authorize the expenditure,the governor shall provide the Legislative Budget and Audit Committee with a statement of the governor's reasons before commencement of expenditures under the revised program. Sec.37.07.090.Performance reporting.[Repealed,Sec.9 ch 27 SLA 1998]. Repealed or Renumbered Sec.37.07.100.Proposed supplemental!or special appropriations. The governor from time to time may transmit to the legislature proposed supplemental or special appropriations in accordance with AS 37.07.070 which in the governor's judgment are necessary. However,if the governor finds that an emergency situation necessitates the proposal of supplemental or special appropriations,the governor may transmit them to the legislature at any time.The governor shall accompany each proposal with a statement of the reasons for it,including the reasons for its omission from the budget. Sec.37.07.110.Interpretation of chapter. This chapter shall be construed as supplemental to all other state laws not in conflict with it.Ifa section or part of a section ofthis chapter is in conflict with federal requirements for a program for which federal grant-in-aid funds are available,the section or part,to the extent of the conflict,is inoperative. Exhibit S-7 Page 12 of 13 Sec.37.07.120.Definitions. In this chapter, (1)"agency"means a department,officer,institution,board,commission,bureau,division,or other administrative unit forming the state government and includes the Alaska Pioneers'Home,the Alaska Veterans'Home,and the University of Alaska,but does not include the legislature or the judiciary; (2)"allocation”means an amount set out as a legislative guideline for expenditure by a state agency for a stated purpose within the total amount of an appropriation; (3)"appropriation"means a maximum amount available for expenditure by a state agency for a stated purpose set out in an appropriation act; (4)"capital projects”and "capital improvements"mean an allocation or appropriation item for an asset with an anticipated life exceeding one year and a cost exceeding $25,000 and include land acquisition,construction,structural improvement,engineering and design for the project,and equipment and repair costs; (5)"facility operations”means activities and expenses relating to the day-to-day operations of a building or facility,including utilities,janitorial service,security service,snow removal,and direct supervision of related maintenance activities; (6)"fiscal year"means a year beginning on July 1 of one calendar year and ending on June 30 of the following calendar year; (7)"maintenance and repair"means the day-to-day scheduled and preventive maintenance effort,including minor repair work,required to keep a building or facility operational and ina continuous state of readiness; (8)"object of expenditure”means a line item of expenditure within an allocation or an appropriation; (9)"office"means the Alaska office of management and budget established in the Office of the Governor by AS 44.19.141; (10)"renewal and replacement"means the scheduled replacement of worn-out major building components and the replacement or retrofitting of obsolete or inefficient building systems in order to maintain or extend the life of a building or facility. Sec.37.07.130.Short title. This chapter may be cited as the Executive Budget Act. Exhibit S-7 Page 13 of 13 Exhibit S-8 Article 03.INVESTMENT AND DEPOSIT OF STATE FUNDS Sec.37.10.070.Investment of residual money. (a)The commissioner shall invest,as set out in AS 37.10.071,the money in the state treasury above an amount sufficient to meet immediate expenditure needs.In managing the invested assets,the commissioner shall (1)consider the status of the assets and liabilities on both a current and a probable future basis; (2)determine the appropriate investment objectives; (3)establish investment policies to achieve the objectives;and (4)act only in regard to the best financial interests of the state. (b}The commissioner may invest on the basis of probable total rate of return without regard to the distinction between principal and income and without regard to the generation of income. (c)In this section,"commissioner"means the commissioner of revenue. Sec.37.10.071.Investment powers and duties. (a)In making investments under this section,the fiduciary of a state fund shall (1)act as official custodian of cash and investments by securing adequate and safe custodial facilities for them; (2)receive all items of cash and investments; (3)collect and deposit the principal of and income from owned or acquired investments; (4)invest and reinvest the assets in accordance with this section; (5)receive and spend appropriations to cover the cost of the exercise of duties under this section; (6)exercise the powers of an owner with respect to the assets; (7)perform all acts,not prohibited by this section,whether or not expressly authorized,that the fiduciary considers necessary or proper in administering the assets; (8}maintain accounting records in accordance with generally accepted accounting principles; (9)engage an independent certified public accountant to conduct an annual audit of the financial condition and investment transactions; Exhibit S-8 Page 1 Of 4 (10)enter into and enforce contracts or agreements considered necessary,convenient,or desirable for the investment purposes of this section;and (11)when choosing to acquire or dispose of investments,secure competitive national or international market rates or prices,or the equivalence of those rates or prices in the judgment of the fiduciary. (b)Under this section,the fiduciary of a state fund or the fiduciary's designee may (1)delegate investment,custodial,or depository authority on a discretionary or nondiscretionary basis to officers or employees of the state or to independent firms,banks,financial institutions,or trust companies by designation through appointments,contracts,or letters of authority; (2)acquire or dispose of investments either directly,indirectly,or through investment pools or trusts,by competitive or negotiated agreements,contracts,or auctions,in public or private markets; (3)concentrate or diversify investments as the fiduciary considers appropriate to increase the probable total rate of return or to decrease the overall exposure to potentially adverse market value risks; (4)protect the market value or the rate of return of the investments by entering into forward agreements to buy or sell assets at a future date as a hedge against existing held assets or as a precommitment of future cash flows; (5)lend assets,under an agreement and for a fee,against deposited collateral of equivalent market value; (6)borrow assets ona short-term basis,under an agreement and for a fee,against the deposit of collateral consisting of other assets in order to accommodate temporary cash or investment needs; (7)hold investments in bearer or registered form in the name of the state,a fund,or nominees authorized by the fiduciary; (8)utilize consultants,advisors,custodians,investment services,and legal counsel for assistance in investment matters on either a continuing or a limited-term basis and with or without compensation; (9)declare records to be confidential and exempt from AS 40.25.110 and 40.25.120 if the records contain information that discloses the particulars of the business or the affairs of a private enterprise,investor,borrower,advisor,consultant,counsel,or manager. (c)In exercising investment,custodial,or depository powers or duties under this section,the fiduciary of a state fund shall apply the prudent investor rule and exercise the fiduciary duty in the sole financial best interest of the fund entrusted to the fiduciary.Among beneficiaries of a fund,the fiduciaries shall treat beneficiaries with impartiality. Exhibit S-8 Page 2 Of 4 (d)In exercising investment,custodial,or depository powers or duties under this section,the fiduciary or the fiduciary's designee is liable for a breach of a duty that is assigned or delegated under this section,or under AS 14.40.255,14.40.280(c},14.40.400(b),AS 37.10.070,AS 37.14.110(c), 37.14.160,or 37.14.170.However,the fiduciary or the designee is not liable for a breach of a duty that has been delegated to another person if the delegation is prudent under the applicable standard of prudence set out in statute or if the duty is assigned by law to another person,except to the extent that the fiduciary or designee (1)knowingly participates in,or knowingly undertakes to conceal,an act or omission of another person knowing that the act or omission is a breach of that person's duties under this chapter; (2)by failure to comply with this section in the administration of specific responsibilities, enables another person to commit a breach of duty;or (3)has knowledge of a breach of duty by another person,unless the fiduciary or designee makes reasonable efforts under the circumstances to remedy the breach. (e)The state shall defend and indemnify the fiduciary or an officer or employee of the state against liability under (d)of this section to the extent that the alleged act or omission was performed in good faith and was prudent under the applicable standard of prudence. (f)In this section,"fiduciary of a state fund"or "fiduciary"means (1)the commissioner of revenue for investments under AS 37.10.070; (2)with respect to the Alaska Retirement Management Board,for investments ofthe collective funds that it manages and administers, (A)each trustee who serves on the board of trustees;and (B)any other person who exercises control or authority with respect to management or disposition of assets for which the board is responsible or who gives investment advice to the board;or (3)the person or body provided by law to manage the investments for investments not subject to AS 37.10.070. Sec.37.10.075.Deposit of state funds. (a)When the commissioner of revenue determines that there are funds in the state treasury that are not being used for the purposes provided for in AS 37.10.070,they may be deposited in financial institutions.Collateral may be required by the commissioner to secure state deposits provided for under this section. (b)The commissioner of revenue may require the banks in which state funds are deposited under a time deposit agreement to pay at least a minimum interest rate to be fixed by the Department Exhibit S-8 Page 3 Of 4 of Revenue,and this interest when paid shall be deposited in the general fund or in the other funds that are established by law. (c)This section does not prohibit the Department of Revenue from depositing the funds that it considers necessary for the proper conduct of the office in solvent banks outside the state under the terms and conditions provided in this section. (d)The Department of Revenue may deposit funds in banks inside or outside the state without requiring those banks in which the funds are deposited to pay interest on the deposits.It is the intention of the legislature that the department may compensate the banks for handling state disbursements ina manner determined by the commissioner of revenue to be in the best interests of the state. (e)Banks holding state deposits shall,as a condition of retaining those deposits,submit all information concerning the deposits and other relevant matters that may be requested by the commissioner. Exhibit S-8 Page 4 Of 4 Exhibit S-9 Chapter 44.62.ADMINISTRATIVE PROCEDURE ACT Article 01.APPLICATION AND EFFECT Sec.44.62.010.Application to State Organization Act of 1959. Rule-making power conferred by ch 64 SLA 1959 is subject to this chapter. Sec.44.62.020.Authority to adopt,administer,or enforce regulations. Except for the authority conferred upon the lieutenant governor in AS 44.62.130 -44.62.170, AS 44.62.010 -44.62.320 do not confer authority upon or augment the authority of a state agency to adopt,administer,or enforce a regulation.To be effective,each regulation adopted must be within the scope of authority conferred and in accordance with standards prescribed by other provisions of law. Sec.44.62.030.Consistency between regulation and statute. If,by express or implied terms of a statute,a state agency has authority to adopt regulations to implement,interpret,make specific or otherwise carry out the provisions of the statute,a regulation adopted is not valid or effective unless consistent with the statute and reasonably necessary to carry out the purpose of the statute. Article 02.SUBMISSION,FILING,AND PUBLICATION OF REGULATIONS Sec.44.62.040.Submitting regulations. (a)Subject to (c)of this section,every state agency that by statute possesses regulation-making authority shall submit to the lieutenant governor for filing a certified original and one duplicate copy of every regulation or order of repeal adopted by it,except one that (1)establishes or fixes rates,prices,or tariffs; (2)relates to the use of public works,including streets and highways,under the jurisdiction of a state agency if the effect of the order is indicated to the public by means of signs or signals;or (3)is directed to a specifically named person or to a group of persons and does not apply generally throughout the state. (b)Citation of the general statutory authority under which a regulation is adopted,as well as citation of specific statutory sections being implemented,interpreted,or made clear,must follow the text of each regulation submitted under (a)of this section. (c)Before submitting the regulations and orders of repeal to the lieutenant governor under (a) of this section,every state agency that by statute possesses regulation making authority,except the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game,the Alaska Oil and Gas Exhibit S-9 Page 1 of 16 Conservation Commission,the office of victims'rights,and the office of theombudsman,shall submit to the governor for review a copy of every regulation or order of repeal adopted by the agency,except regulations and orders of repeal identified in (a)(1)and (2)of this section.The governor may review the regulations and orders of repeal received under this subsection.The governor may return the regulations and orders of repeal to the adopting agency before they are submitted to the lieutenant governor for filing under (a)of this section within 30 days (1)if they are inconsistent with the faithful execution of the laws,or (2)to enable the adopting agency to respond to specific issues raised by the Administrative Regulation Review Committee.The governor may not delegate the governor's review authority under this subsection to a person other than the lieutenant governor. Sec.44.62.050.Style and forms. The Department of Law shall prepare and shall revise when necessary a drafting manual for administrative regulations that prescribes the style and forms for submitting regulations under AS 44.62.040. Sec.44.62.060.Preparation and filing. (a)Every state agency that by statute possesses regulation-making authority shall work with the Department of Law,under AS 44.62.125,in the preparation and revision of its regulations and shall adhere to the drafting manual for administrative regulations prepared by the Department of Law under AS 44.62.050. (b)In the performance of duties under AS 44.62.125,the Department of Law shall advise the agencies on legal matters relevant to the adoption of regulations and may advise the agencies on the need for and the policy involved in particular regulations.In addition,the department shall prepare a written statement of approval or disapproval after each regulation has been reviewed in order to determine (1)its legality,constitutionality,and consistency with other regulations; (2)the existence of statutory authority and the correctness of the required citation of statutory authority following each section; (3)its clarity,simplicity of expression,and absence of possibility of misapplication; (4)compliance with the drafting manual for administrative regulations. (c)The lieutenant governor may not accept for filing a regulation,amendment,or order of repeal required by AS 44.62.040 unless it is accompanied by the written statement specified in (b)of this section and the statement approves the regulation,amendment,or order of repeal. Sec.44.62.070.Fees. A state officer or public official may not charge a fee to perform an official act in connection with the certification,submission,or filing of regulations under AS 44.62.040 -44.62.120. Exhibit S-9 Page 2 of 16 Sec.44.62.080.Endorsement and filing. (a)The lieutenant governor shall (1)endorse on the certified copy of each regulation or order of repeal filed,the time and date of filing;and (2)maintain,for five years after filing,a permanent file of the certified copies of regulations and orders of repeal for public inspection;after the certified copies have been on file for five years,the lieutenant governor shall transfer the permanent file of the copies to the state archivist (AS 40.21.020) annually,on or before January 1 of each year. (b)The state archivist shall have and maintain,for public inspection,the permanent file of the certified copies of regulations and orders of repeal transferred to the archivist by the lieutenant governor under (a)(2)of this section. Sec.44.62.090.Filing with local government unit clerks.[Repealed,Sec.2 ch 57 SLA 1969]. Repealed or Renumbered Sec.44.62.100.Presumptions from filing. (a)The filing of a certified copy of a regulation or an order of repeal by the lieutenant governor raises the rebuttable presumptions that (1)it was duly adopted; (2)it was duly filed and made available for public inspection at the day and hour endorsed on it; (3)all requirements of this chapter and the regulations relative to the regulation have been complied with; (4)the text of the certified copy of a regulation or order of repeal is the text of the regulation or order of repeal as adopted. (b)The courts shall take judicial notice of the contents of the certified copy of each regulation and of each order of repeal duly filed. Sec.44.62.110.Presumptions from publication. (a)The publication of a regulation in the Alaska Administrative Code or register raises a rebuttable presumption that the text of the regulation as so published is the text of the regulation adopted. (b)The courts shall take judicial notice of the contents of each regulation or notice of the repeal of a regulation printed in the Alaska Administrative Code or Alaska Administrative Register. Exhibit S-9 Page 3 of 16 Sec.44.62.120.Voluntary submitting and publication. With the approval of the lieutenant governor,a state agency may submit to the lieutenant governor for filing a regulation or order of repeal of a regulation not required by AS 44.62.040 to be submitted.If the lieutenant governor accepts the regulation or order of repeal,the lieutenant governor shall endorse and file it as required in AS 44.62.080,and may publish the regulation or order of repeal in the manner the lieutenant governor considers proper. Sec.44.62.125.Regulations attorney. (a)In the Department of Law a particular attorney,called the regulations attorney,shall be assigned,as the attorney's primary responsibility,the functions relating to the handling of administrative regulations. (b)The department shall (1)advise all state administrative agencies of the nature and use of administrative regulations; (2)alert the agencies to statutes that need to be implemented,interpreted,or made clear by regulation; (3)continually review the regulations,make recommendations to the respective agencies concerning deficiencies,conflicts,and obsolete provisions in and the need for reorganization or revision of the regulations,and prepare regulations to be adopted by the agencies,correcting or removing the deficiencies,conflicts,and obsolete provisions; (4)work with all administrative agencies possessing regulation-making power in drafting all new regulations,advising the agencies of legal problems encountered,and ensuring compliance with the drafting manual for administrative regulations prepared by the Department of Law under AS 44.62.050; (5)assist the agencies in holding public hearings under AS 44.62.210; (6)to the extent necessary after regulations have been filed by the lieutenant governor,edit and revise them for consolidation into the Alaska Administrative Code in the manner provided for the revisor of statutes under AS 01.05.031; (7)draft bills for consideration by the governor to transfer matter that should be statutory law from the Alaska Administrative Code to the Alaska Statutes and to clarify agency regulatory power when clarification is needed. Article 03.THE ALASKA ADMINISTRATIVE REGISTER AND CODE Sec.44.62.130.Codification and publication. (a)The lieutenant governor shall provide for the continuing compilation,codification,and publication,with periodic supplements,of all regulations filed by the lieutenant governor's office,or of appropriate references to any regulations the printing of which the lieutenant governor finds to be Exhibit S-9 Page 4 of 16 impractical,such as detailed schedules or forms otherwise available to the public,or which are of limited or particular application.The publication of compiled regulations is the Alaska Administrative Code.The periodic supplements to it are the Alaska Administrative Register.The code and register must contain appropriate annotations to judicial decisions and opinions of the attorney general. (b)The Department of Law shall prescribe a uniform system of indexing,numbering, arrangement of text,and citation of authority and history notes for the Alaska Administrative Code. Sec.44.62.140.Distribution of code and register. (a)Except as provided in this section,the lieutenant governor shall supply a complete set of the Alaska Administrative Code,and of the Alaska Administrative Register,and of each supplement to the code or register to the clerk of each local government unit,or if the authority to accept filings is delegated,to the person to whom this authority is delegated.A local government unit may decide to be excluded from the distribution requirements of this subsection.After receiving notice from the local government unit of the unit's decision to be excluded,the lieutenant governor shall exclude that local government unit from the distribution requirements of this subsection. (b)A local government unit that requests to be excluded from the distribution requirements of (a)of this section may request to start receiving distributions as described under (a)of this section by providing written notice to the lieutenant governor.No later than July 1 of the fiscal year following receipt of notice by the lieutenant governor,the lieutenant governor shall include the local government unit in the distribution. Sec.44.62.150.Price.[Repealed,Sec.49 ch 127 SLA 1974]. Repealed or Renumbered Sec.44.62.160.Date and content of register. (a)The Alaska Administrative Register shall be published quarterly on the first day of the month. All regulations required to be submitted under AS 44.62.040 that are filed by the first day of the month preceding publication shall be published in the register for that quarter. (b)lf during a quarter no regulation,amendment,or order of repeal has been filed the regular quarterly register shall be published reflecting that fact. Sec.44.62.170.Form of publication.[Repealed,Sec.2 ch 57 SLA 1969]. Repealed or Renumbered Sec.44.62.175.Alaska Online Public Notice System. (a)The lieutenant governor shall develop and supervise the Alaska Online Public Notice System, to be maintained on the state's site on the Internet.The lieutenant governor shall prescribe the form of notices posted on the system by state agencies.The Alaska Online Public Notice System must include Exhibit S-9 Page 5S of 16 (1)notices of proposed actions given under AS 44.62.190(a); (2)notices of state agency meetings required under AS 44.62.310(e),even if the meeting has been held; (3)notices of solicitations to bid issued under AS 36.30.130; (4)notices of state agency requests for proposals issued under AS 18.55.255,18.55.320;AS 36.30.210;AS 37.05.316;AS 38.05.120;and AS 43.40.010; (5)executive orders and administrative orders issued by the governor; (6)written delegations of authority made by the governor or the head of a principal department under AS 44.17.010; (7)the text or a summaryof the text of a regulation or order of repeal of a regulation for which notice is given under AS 44.62.190(a)},including an emergency regulation or repeal regardless of whether it has taken effect; (8)notices required by AS 44.62.245(b)regarding an amended version of a document or other material incorporated by reference in a regulation; (9)asummary of the text of recently issued published opinions of the attorney general; (10)a list of vacancies on boards,commissions,and other bodies whose members are appointed by the governor; (11)in accordance with AS 39.52.240(h),advisory opinions of the attorney general;and (12)notices required by AS 26.30.010(d)and (e)regarding applications for military facility zones. (b)The issuer of the notice,order,delegation,text,summary,or list in (a)of this section shall post on the Alaska Online Public Notice System the notice,order,delegation,text,summary,or list, prepared in the format required by the lieutenant governor. (c)A request for a printed copy of a required posting on the Alaska Online Public Notice System may be made under AS 40.25.110 -40.25.220 to any state employee designated by the lieutenant governor to receive requests. (d)The lieutenant governor shall provide for a permanent,electronic archive system of notices posted on the Alaska Online Public Notice System under this section.Access to the electronic archive system shall be made available to the public. (e)The lieutenant governor may delegate duties under this section to qualified state employees. (f)A person may not maintain an action based on a posting or lack of posting on the Alaska Online Public Notice System. Exhibit S-9 Page 6 of 16 Article 04.PROCEDURE FOR ADOPTING REGULATIONS Sec.44.62.180.Effective date. A regulation or an order of repeal filed by the lieutenant governor becomes effective on the 30th day after the date of filing unless (1)otherwise specifically provided by the statute under which the regulation or order of repeal is adopted,in which event it becomes effective on the day prescribed by the statute; (2)it is a regulation prescribing the organization or procedure of an agency,in which event it becomes effective upon filing by the lieutenant governor or upon a later date specified by the state agency in a written instrument submitted with,or as part of,the regulation or order of repeal; (3)it is an emergency regulation or order of repeal adopted under AS 44.62.250,in which case the finding and the statement of the facts constituting the emergency shall be submitted to the lieutenant governor,together with the emergency regulation or order of repeal,which,in that event only,becomes effective upon filing by the lieutenant governor or upona later date specified by the state agency in a written instrument submitted with,or as part of,the regulation or order of repeal; (4)a later date is prescribed by the state agency in a written instrument submitted with,or as part of,the regulation or order of repeal. Sec.44.62.190.Notice of proposed action. (a)At least 30 days before the adoption,amendment,or repeal of a regulation,notice of the proposed action shall be (1)published in the newspaper of general circulation or trade or industry publication that the state agency prescribes and posted on the Alaska Online Public Notice System;in the discretion of the state agency giving the notice,the requirement of publication in a newspaper or trade or industry publication may be satisfied by using a combination of publication and broadcasting;when broadcasting the notice,an agency may use an abbreviated form ofthe notice if the broadcast provides the name and date of the newspaper or trade or industry journal and the Internet address of the Alaska Online Public Notice System where the full text of the notice can be found; (2)furnished to every person who has filed a request for notice of proposed action with the state agency; (3)if the agency is within a department,furnished to the commissioner of the department; (4)when appropriate in the judgment ofthe agency, (A)furnished to a person or group of persons whom the agency believes is interested in the proposed action;and (B)published in the additional form and manner the state agency prescribes; Exhibit S-9 Page 7 of 16 (5)furnished to the Department of Law together with a copy of the proposed regulation, amendment,or order of repeal for the department's use in preparing the opinion required after adoption and before filing by AS 44.62.060; (6)furnished by electronic format to all incumbent State of Alaska legislators,and furnished to the Legislative Affairs Agency; (7)furnished by electronic format,along with a copy of the proposed regulation,amendment,or order of repeal,as required by AS 24.20.105(c). (b)If the form or manner of notice is prescribed by statute,in addition to the requirements of filing and furnishing notice under AS 44.62.010 -44.62.300,or in addition to the requirements of filing and mailing notice under other sections of this chapter,the notice shalt be published,posted,mailed, filed,or otherwise publicized as prescribed by the statute. (c)The failure to furnish notice to a person as provided in this section does not invalidate an action taken by an agency under AS 44.62.180 -44.62.290. (d)Along with a notice furnished under (a)(2),(4)(A),or (6)of this section,the state agency, except the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game,and the Alaska Oil and Gas Conservation Commission,shall include (1)the reason for the proposed action,including,if applicable,an identification of the law, order,decision,or other action of the federal government or a federal or state court that is the basis for the proposed action;in this paragraph,"federal government"means a department,agency,corporation, or instrumentality of the United States government; (2)the initial cost to the state agency of implementation; (3)the estimated annual costs,based on a good faith effort to estimate the costs in the aggregate for each of the following categories using the information available to the state agency,to (A)private persons to comply with the proposed action; (B)the state agency for implementation and to other state agencies to comply with the proposed action;and (C)municipalities to comply with the proposed action; (4)the name of the contact person for the state agency;and (5)the origin of the proposed action. (e)Notwithstanding (a)of this section,if a person who is to receive a notice under (a)ofthis section requests that the state agency mail the notice,the state agency shall furnish the notice to the person by mail. Exhibit S-9 Page 8 of 16 (f)To the extent feasible,the subject line of electronic mail and the title of a written publication providing the information required by (d)of this section must give the reader a fair idea of the substance of the proposed new regulation,the proposed amended regulation,or the regulation proposed for repeal. (g)Along with a notice furnished under (a)(2),(4)(A),or (6)of this section,the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game,and the Alaska Oil and Gas Conservation Commission shall include the reason for the proposed action,the initial cost of implementation to the state agency,the estimated annual costs of implementation to the state agency, the name of a contact person,and the origin of the proposed action. Sec.44.62.195.Fiscal notes on regulations. If the adoption,amendment,or repeal of a regulation would require increased appropriations by the state,the department or agency affected shall prepare an estimate of the appropriation increase for the fiscal year following adoption,amendment,or repeal of the regulation and for at least two succeeding fiscal years. Sec.44.62.200.Contents of notice. (a)The notice of proposed adoption,amendment,or repeal of a regulation must include (1)a statement ofthe time,place,and nature of proceedings for adoption,amendment,or repeal of the regulation; (2)reference to the authority under which the regulation is proposed and a reference to the particular code section or other provisions of law that are being implemented,interpreted,or made specific; (3)an informative summary of the proposed subject of agency action; (4)other matters prescribed by a statute applicable to the specific agency or to the specific regulation or class of regulations; (5)asummary of the fiscal information required to be prepared under AS 44.62.195. (b)A regulation that is adopted,amended,or repealed may vary in content from the summary specified in (a)(3)of this section if the subject matter of the regulation remains the same and the original notice was written so as to assure that members of the public are reasonably notified of the proposed subject of agency action in order for them to determine whether their interests could be affected by agency action on that subject. (c)An agency that issues a notice under this section shall ensure that the notice is prepared ina form adequate for posting on the Alaska Online Public Notice System.Unless the adoption,amendment, or repeal of a regulation is proposed by the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game,or the Alaska Oil and Gas Conservation Commission,a complete copy of each proposed Exhibit S-9 Page 9 of 16 adoption,amendment,or repeal of a regulation and,if feasible and not prohibited by copyright,any document or other material incorporated by reference,including any document or other material incorporated by reference under this section,in the proposed adoption or amendment shall be made available on the Alaska Online Public Notice System by providing an electronic attachment or link to the complete text. (d)When a state agency,other than the Regulatory Commission of Alaska,the Board of Fisheries,or the Board of Game,posts,furnishes,or otherwise provides a notice of the proposed adoption,amendment,or repeal of a regulation under AS 44.62.190,a brief description of the changes made by the proposed adoption,amendment,or repeal must accompany the notice.However,if,under AS 44.62.190(a),the notice is published in a newspaper or trade or industry publication or is broadcast, this subsection does not require that the brief description otherwise required by this subsection accompany the publication or the broadcast.To the extent practicable,the brief description shall be written in clear,easily readable language that a person without a legal background is able to understand. Sec.44.62.210.Public proceedings. (a)On the date and at the time and place designated in the notice the agency shall give each interested person or the person's authorized representative,or both,the opportunity to present statements,arguments,or contentions in writing,with or without opportunity to present them orally. The state agency may accept material presented by any form of communication authorized by this chapter and shall consider all factual,substantive,and other relevant matter presented to it before adopting,amending,or repealing a regulation.When considering the factual,substantive,and other relevant matter,the agency shall pay special attention to the cost to private persons of the proposed regulatory action. (b)At a hearing under this section the agency or its authorized representative may administer oaths or affirmations,and may continue or postpone the hearing to the time and place which it determines. Sec.44.62.213.Agency contact with the public. (a)Notwithstanding any other provision of this chapter,while an agency is developing a regulatory action and before the agency provides a notice of proposed action under AS 44.62.190,the agency may contact a person about the development of the regulatory action,and the agency may answer a question from a person that is relevant to the development of the regulatory action.In this subsection,"regulatory action"means the adoption,amendment,or repeal of a regulation. (b)Notwithstanding any other provision of this chapter,after an agency provides a notice of proposed action under AS 44.62.190,the agency shall make a good faith effort to answer,before the end of the public comment period,a question that is relevant to the proposed action,if the question is received in writing or asked at a public meeting at least 10 days before the end ofthe public comment period.If a question is received after the 10-day cutoff date,the agency may answer the question.When Exhibit S-9 Page 10 of 16 an agency answers a question under this section,the agency shall answer the question in writing and make the question and answer available to the public.An agency may satisfy the requirements of this section by posting answers to frequently asked questions about the proposed action on the Alaska Online Public Notice System and may aggregate substantially similar questions and agency responses and provide a single consolidated response to substantially similar questions. (c)In this section,"agency"does not include the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game,or the Alaska Oil and Gas Conservation Commission. Sec.44.62.215.Record of public comment. In the drafting,review,or other preparation of a proposed regulation,amendment,or order of repeal, an agency,other than the Regulatory Commission of Alaska,the Board of Fisheries,the Board of Game, the Alaska Oil and Gas Conservation Commission,the office of victims'rights,and the office of the ombudsman,shall keep a record of its use or rejection of factual or other substantive information that is received in writing or orally as public comment and that is relevant to the accuracy,coverage,or other aspect of the proposed regulatory action. Sec.44.62.218.Regulations affecting small businesses.[Repealed,Sec.2 ch 91 SLA 2005]. Repealed or Renumbered Sec.44.62.220.Right to petition. Unless the right to petition for adoption of a regulation is restricted by statute to a designated group or the procedure for the petition is prescribed by statute,an interested person may petition an agency for the adoption or repeal of a regulation as provided in AS 44.62.180 -44.62.290.The petition must state clearly and concisely (1)the substance or nature of the regulation,amendment,or repeal requested; (2)the reasons for the request; (3)reference to the authority of the agency to take the action requested. Sec.44.62.230.Procedure on petition. Upon receipt of a petition requesting the adoption,amendment,or repeal of a regulation under AS 44.62.180 -44.62.290,a state agency shall,within 30 days,deny the petition in writing or schedule the matter for public hearing under AS 44.62.190 -44.62.215.However,if the petition is for an emergency regulation,and the agency finds that an emergency exists,the requirements of AS 44.62.040(c)and 44.62.190 -44.62.215 do not apply,and the agency may submit the regulation to the lieutenant governor immediately after making the finding of emergency and putting the regulation into proper form. Exhibit S-9 Page 11 of 16 Sec.44.62.2400.Limitation on retroactive action. If a regulation adopted by an agency under this chapter is primarily legislative,the regulation has prospective effect only.A regulation adopted under this chapter that is primarily an "interpretative regulation"has retroactive effect only if the agency adopting it has adopted no earlier inconsistent regulation and has followed no earlier course of conduct inconsistent with the regulation.Silence or failure to follow any course of conduct is considered earlier inconsistent conduct. Sec.44.62.245.Material incorporated by reference. (a)In adopting a regulation that incorporates a document or other material by reference,a state agency may incorporate future amended versions of the document or other material if the adopted regulation identifies or refers to the document or other material followed by the phrase "as may be amended,"the phrase "as amended from time to time,"or a similar provision and the (1)document consists of a regulation of another agency of the state;or (2)incorporation of a future amended version of the document or other material is explicitly authorized by a statute. (b)When the amended version of a document or other material incorporated by reference ina regulation as described in (a)of this section becomes available,the state agency shall (1)make the amended version of the document or other material available to the public for review;and (2)post on the Alaska Online Public Notice System and publish in a newspaper of general circulation or trade or industry publication or in a regularly published agency newsletter or similar printed publication,not later than 15 days after the amended version of the document or other material becomes available,a notice that describes the affected regulation,the effective date of the amended version of the document or other material,and how a copy of the amended version may be obtained or reviewed. (c)The state agency shall also send the notice described in (b)(2)of this section to (1)a person who has placed the person's name on a distribution list kept by the agency that lists persons who want to receive the notice;the agency may allow a person to request that distribution of the notice be by electronic means and shall honor that request if appropriate means are available; (2)the regulations attorney in the Department of Law;and (3)the members of the Administrative Regulation Review Committee. (d)A change in the form,format,or title in a future amended or revised version of a document or material incorporated by reference in a regulation under this section does not affect the validity of the regulation or the state agency's ability to enforce or implement the regulation.The state agency Exhibit S-9 Page 12 of 16 shall notify the regulations attorney in the Department of Lawif the title of the document or other material changes.The regulations attorney shall correct the title in the Alaska Administrative Code under AS 44.62.125. Sec.44.62.250.Emergency regulations. A regulation or order of repeal may be adopted as an emergency regulation or order of repeal if a state agency makes a written finding,including a statement of the facts that constitute the emergency,that the adoption of the regulation or order of repeal is necessary for the immediate preservation of the public peace,health,safety,or general welfare.The requirements of AS 44.62.040(c),44.62.060,and 44.62.190 -44.62.215 do not apply to the initial adoption of emergency regulations;however,upon adoption of an emergency regulation the adopting agency shall immediately submit a copy of it to the lieutenant governor for filing and for publication in the Alaska Administrative Register,and within five days after filing by the lieutenant governor the agency shall give notice of the adoption in accordance with AS 44.62.190(a).Failure to give the required notice by the end of the 10th day automatically repeals the regulation. Sec.44.62.260.Limitation on effective period of emergency regulations. (a)Aregulation adopted as an emergency regulation does not remain in effect more than 120 days unless the adopting agency complies with AS 44.62.040(c),44.62.060,and 44.62.190 -44.62.215 either before submitting the regulation to the lieutenant governor or during the 120-day period. (b)Before the expiration of the 120-day period,the agency shall transmit to the lieutenant governor for filing a certification that AS 44.62.040(c),44.62.060,and 44.62.190 -44.62.215 were complied with before submitting the regulation to the lieutenant governor,or that the agency complied with those sections within the 120-day period.Failure to so certify repeals the emergency regulation;it may not be renewed or refiled as an emergency regulation. Sec.44.62.270.State policy. It is the state policy that emergencies are held to a minimum and are rarely found to exist. Sec.44.62.280.Purpose of AS 44.62.180 -44.62.290. It is the purpose of AS 44.62.180 -44.62.290 to establish basic minimum procedural requirements for the adoption,amendment,or repeal of administrative regulations.Except as provided in AS 44.62.250, AS 44.62.180 -44.62.290 apply to the exercise of quasi-legislative power conferred by a statute,but nothing in AS 44.62.180 -44.62.290 repeals or diminishes additional requirements imposed by the statute.AS 44.62.180 -44.62.290 are not superseded or modified by subsequent legislation except to the extent that the legislation does so expressly. Exhibit S-9 Page 13 of 16 Sec.44.62.290.Limits of the application of AS 44.62.180 -44.62.290. (a)AS 44.62.180 -44.62.290 do not apply to a regulation not required to be submitted to the lieutenant governor under AS 44.62.010 -44.62.320. (b)Only this section and AS 44.62.180 apply to a regulation that prescribes the organization or procedure of an agency. Article 05.JUDICIAL REVIEW Sec.44.62.300.Judicial review of validity. (a)An interested person may get a judicial declaration on the validity of a regulation by bringing an action for declaratory relief in the superior court.In addition to any other ground the court may declare the regulation invalid (1)for a substantial failure to comply with AS 44.62.010 -44.62.320;or (2)in the case of an emergency regulation or order of repeal,upon the ground that the facts recited in the statement do not constitute an emergency under AS 44.62.250. (b}Notwithstanding (a)of this section,a person may not bring an action in court to challenge the adoption,repeal,or amendment of a regulation by a state agency for (1)insufficiency or inaccuracy of the information provided under AS 44.62.190(d)or (g); (2)failure of the subject line of electronic mail or the title of a written publication to meet the requirements of AS 44.62.190(f); (3)failure of the brief description required by AS 44.62.200(d)to comply with the requirements of AS 44.62.200(d)relating to (A)the clarity and readability of the brief description;or (B)the description of the changes made by the proposed adoption,amendment,or repeal of a regulation;or (4)inaccuracy or insufficiency of the answer to a question provided by the state agency under AS 44.62.213. Sec.44.62.305.Judicial relief in administrative matters. (a)Notwithstanding any other provision of law to the contrary and except as provided in (f)and (g)of this section,a person may obtain judicial relief in an administrative matter from the superior court before the state agency handling the administrative proceeding on the matter issues a final administrative decision if (1)the person is a party to the administrative proceeding; Exhibit S-9 Page 14 of 16 (2)the person has satisfied the procedural requirements of the administrative proceeding up to the time that the person petitions for judicial relief under (b)of this section; (3)the state agency has unreasonably delayed the progress of the administrative proceeding; and (4)further delay in reaching a final administrative decision will cause the person immediate and irreparable damage. (b)A person may seek judicial retief under (a)of this section by filing a petition in the superior court.A person may not file the petition until 30 days after the person has filed with the state agency handling the administrative proceeding a written notice that the person intends to file the petition. (c)Ina proceeding begun under (b)of this section,if the superior court determines that the person is eligible for judicial relief under (a)of this section,the superior court may (1)enjoin the administrative proceeding and determine the administrative matter in the superior court; (2)order that the administrative matter be handled by another form of dispute resolution;or (3)establish a deadline for the state agency to issue a final administrative decision. (d)After a person files a petition under (b)of this section,the state agency shall continue with the administrative proceeding unless the superior court (1)enjoins the administrative proceeding under (c)({1)of this section;or (2)issues an order under (c}(2)of this section. (e)tf the superior court decides that a person is not eligible for judicial relief under (a)of this section,a party to the administrative proceeding may exercise any right of appeal allowed under law for the final administrative decision as if the person had not filed a petition under (b)of this section. (f)A person may not obtain judicial relief under this section in a personnel proceeding by a state agency.In this subsection,"personnel proceeding”includes a proceeding under AS 39.25 (State Personnel Act)and a proceeding in a grievance arbitration procedure under a collective bargaining agreement. (g)This section does not apply to an administrative proceeding of a state agency if another statute of this state establishes a deadline for the state agency to makea final decision in the administrative proceeding. (h)In this section, (1)"administrative matter"means the subject matter of an administrative proceeding; Exhibit S-9 Page 15 of 16 (2)"administrative proceeding"means (A)a proceeding subject to AS 44.62.330 -44.62.630;and (B)a proceeding that is not subject to AS 44.62.330 -44.62.630,that is authorized by statute for the adjudication of a state agency matter by the state agency handling the matter or by a person appointed by the state agency,and that involves a matter that directly affects the personal, professional,or business interests of a specific person who is named in the adjudication; (3)"damage"means damage to the personal,professional,or business interests of a person; (4)"party"means a specific person whose personal,professional,or business interests are the subject of an administrative proceeding and who is named in the administrative proceeding; (5)"person"does not include a state agency or other governmental agency; (6)"state agency"means a department,an institution,a board,a commission,a division,an authority,and any other administrative unit of the executive branch of state government,except a public corporation;the term includes the University of Alaska. Article 07.LEGISLATIVE REVIEW OF RULES Sec.44.62.320.Submittal for legislative review. (a)[Repealed,Sec.7 ch 164 SLA 2004]. (b)At the same time a regulation is filed by the lieutenant governor,the lieutenant governor shall submit the regulation to the chairman and all members of the Administrative Regulation Review Committee for review under AS 24.20.400 -24.20.460 together with the fiscal information required to be prepared under AS 44.62.195. (c)At the same time as a regulation is submitted to the governor under AS 44.62.040(c),the state agency shall submit the regulation to the chair and all members of the Administrative Regulation Review Committee for review under AS 24.20.400 -24.20.460 together with the fiscal information required to be prepared under AS 44.62.195. (d)Within 10 days after receiving a regulation under (c)of this section,the chair of the Administrative Regulation Review Committee may submit to the governor,by legislative memorandum or letter,comments on the regulation. Exhibit S-9 Page 16 of 16 Exhibit S-10 Chapter 36.05.WAGES AND HOURS OF LABOR Article 01.PUBLIC CONSTRUCTION CONTRACTS Sec.36.05.005.Applicability. This chapter applies only to a public construction contract that exceeds $25,000. Sec.36.05.010.Wage rates on public construction. A contractor or subcontractor who performs work on a public construction contract in the state shall pay not less than the current prevailing rate of wages for work of a similar nature in the region in which the work is done.The current prevailing rate of wages is that contained in the latest determination of prevailing rate of wages issued by the Department of Labor and Workforce Development at least 10 days before the final date for submission of bids for the contract.The rate shall remain in effect for the life of the contract or for 24 calendar months,whichever is shorter.At the end of the initial 24-month period,if new wage determinations have been issued by the department,the latest wage determination shall become effective for the next 24-month period or until the contract is completed,whichever occurs first.This process shall be repeated until the contract is completed. Sec.36.05.020.Basis for determining wage. A subcontract that is performed on public construction may be reduced to a basis of day labor for the purpose of determining whether or not the subcontractor or contractors have paid at not less than the prevailing scale of wage. Sec.36.05.030.Authority;investigations;hearings;regulations;enforcement. (a)The Department of Labor and Workforce Development has the authority to determine the prevailing wage,and whether or not this chapter is being violated.The department may when necessary for the enforcement of this chapter (1)conduct investigations and hold hearings concerning wages; (2)compel the attendance of witnesses and the production of books,papers,and documents; (3)adopt regulations. (b)If a person violates this chapter the attorney general shall,when requested by the Department of Labor and Workforce Development,enforce these provisions. Sec.36.05.035.Notification of contract awards. Upon awarding a public construction contract,the state or a political subdivision of the state shall Exhibit S-10 Page 1of5 (1)immediately notify the commissioner of labor and workforce development of the amount of the contract,the effective date of the contract,the identity of the contractor and all subcontractors,the site or sites of construction,and provide a project description;and (2)verify that the bonding requirements of AS 36.25 have been met and that the requirements of AS 08.18 have been met. Sec.36.05.040.Filing schedule of employees,wages paid,and other information. All contractors or subcontractors who perform work on a public construction contract for the state or for a political subdivision of the state shall,before the Friday of every second week,file with the Department of Labor and Workforce Development a sworn affidavit for the previous reporting period, setting out in detail the number of persons employed,wages paid,job classification of each employee, hours worked each day and week,and other information on a form provided by the Department of Labor and Workforce Development. Sec.36.05.045.Notice of work and completion;withholding of payment. (a)Before commencing work on a public construction contract,the person entering into the contract with a contracting agency shall designate a primary contractor for purposes of this section. Before work commences,the primary contractor shall file a notice of work with the Department of Labor and Workforce Development.The notice of work must list work to be performed under the public construction contract by each contractor who will perform any portion of work on the contract and the contract price being paid to each contractor.The primary contractor shall pay all filing fees for each contractor performing work on the contract,including a filing fee based on the contract price being paid for work performed by the primary contractor's employees.The filing fee payable shall be the sum of all fees calculated for each contractor.The filing fee shall be one percent of each contractor's contract price.The total filing fee payable by the primary contractor under this subsection may not exceed $5,000.In this subsection,"contractor"means an employer who is using employees to perform work on the public construction contract under the contract or a subcontract. (b)Upon completion of all work on the public construction contract,the primary contractor shall file with the Department of Labor and Workforce Development a notice of completion together with payment of any additional filing fees owed due to increased contract amounts.Within 30 days after the department's receipt of the primary contractor's notice of completion,the department shall inform the contracting agency of the amount,if any,to be withheld from the final payment. (c)A contracting agency (1)may release final payment on a public construction contract to the extent that the agency has received verification from the Department of Labor and Workforce Development that (A)the primary contractor has complied with (a)and (b)of this section; Exhibit S-10 Page 2 of 5 (B)the Department of Labor and Workforce Development is not conducting an investigation under this title;and (C)the Department of Labor and Workforce Development has not issued a notice of a violation of this chapter to the primary contractor or any other contractors working on the public construction contract;and (2)shall withhold from the final payment an amount sufficient to pay the department's estimate of what may be needed to compensate the employees of any contractors under investigation on this construction contract,and any unpaid filing fees. (d)The notice and filing fee required under (a)of this section may be filed after work has begun (1)the public construction contract is for work undertaken in immediate response to an emergency;and (2)the notice and fees are filed not later than 14 days after the work has begun. (e)A false statement made on a notice required by this section is punishable under AS 11.56.210. Sec.36.05.050.Hours to constitute day's work.[Repealed,Sec.1 ch 3 SLA 1973]. Repealed or Renumbered Sec.36.05.060.Penalty for violation of this chapter. A contractor who violates this chapter is guilty of a misdemeanor and upon conviction is punishable by a fine of not less than $100 nor more than $1,000,or by imprisonment for not less than 10 days nor more than 90 days,or by both.Each day a violation exists constitutes a separate offense. Sec.36.05.070.Wage rates in specifications and contracts for public works. (a)The advertised specifications for a public construction contract that requires or involves the employment of mechanics,laborers,or field surveyors must contain a provision stating the minimum wages to be paid various classes of laborers,mechanics,or field surveyors and that the rate of wages shall be adjusted to the wage rate under AS 36.05.010. (b)[Repealed,Sec.17 ch 142 SLA 1972]. (c)A public construction contract under (a)of this section must contain provisions that (1)the contractor or subcontractors of the contractor shall pay all employees unconditionally and not less than once a week; Exhibit S-10 Page 3 of 5 (2)wages may not be less than those stated in the advertised specifications,regardless of the contractual relationship between the contractor or subcontractors and laborers,mechanics,or field surveyors; (3)the scale of wages to be paid shall be posted by the contractor in.a prominent and easily accessible place at the site of the work; (4)the state or a political subdivision shall withhold so much of the accrued payments as is necessary to pay to laborers,mechanics,or field surveyors employed by the contractor or subcontractors the difference between (A)the rates of wages required by the contract to be paid laborers,mechanics,or field surveyors on the work;and (B)the rates of wages in fact received by laborers,mechanics,or field surveyors. Sec.36.05.080.Failure to pay agreed wages. Every contract within the scope of AS 36.05.070 must contain a provision that if it is found that a laborer,mechanic,or field surveyor employed by the contractor or subcontractor has been or is being paid a rate of wages less than the rate of wages required by the contract to be paid,the state or its political subdivision may,by written notice to the contractor,terminate the contractor's right to proceed with the work or the part of the work for which there is a failure to pay the required wages and to prosecute the work to completion by contract or otherwise,and the contractor and the contractor's sureties are liable to the state or its political subdivision for excess costs for completing the work. Sec.36.05.090.Payment of wages from withheld payments and listing contractors who violate contracts. (a)The state disbursing officer in the case of a state public construction contract and the local fiscal officer in the case of a political subdivision public construction contract shall pay directly to laborers,mechanics,or field surveyors from accrued payments withheld under the terms of the contract the wages due laborers,mechanics,or field surveyors under AS 36.05.070. (b)The state disbursing officer or the local fiscal officer shall distribute to all departments of the state government and to all political subdivisions of the state a list giving the names of persons who have disregarded their obligations to employees.A person appearing on this list and a firm,corporation, partnership,or association in which the person has an interest may not work as a contractor or subcontractor on a public construction contract for the state or a political subdivision of the state until three years after the date of publication of the list.If the accrued payments withheld under the contract are insufficient to reimburse all the laborers,mechanics,or field surveyors with respect to whom there has been a failure to pay the wages required under AS 36.05.070,the laborers,mechanics,or field surveyors have the right of action or intervention or both against the contractor and the contractor's sureties conferred by law upon persons furnishing labor or materials,and in the proceedings it is not a defense that the laborers,mechanics,or field surveyors accepted or agreed to accept less than the Exhibit S-10 Page 4 of S Sec.36.05.100.Effect of AS 36.05.070 -36.05.110 on other laws. AS 36.05.070 36.05.110 do not supersede or impair authority granted by state law to provide for the establishment of specific wage rates. Sec.36.05.110.Contracts entered into without advertising. The fact that a public construction contract authorized by law is entered into upon a cost-plus-a-fixed- fee basis or otherwise,without advertising for proposals,does not make AS 36.05.070 -36.05.110 inapplicable if those sections are otherwise applicable to the contract. Sec.36.05.120.Regulations governing contractors.[Repealed,Sec.17 ch 142 SLA 1972]. Repealed or Renumbered Article 02.GENERAL PROVISIONS Sec.36.05.900.Definition. In this chapter,"contracting agency"means the state or a political subdivision of the state that has entered into a public construction contract with a contractor. Exhibit S-10 Page Sof5 Exhibit S-11 Chapter 36.25.CONTRACTORS'BONDS Sec.36.25.010.Bonds of contractors for public buildings or works. (a)Except as provided in AS 44.33.300,before a contract exceeding $100,000 for the construction,alteration,or repair of a public building or public work of the state or a political subdivision of the state is awarded to a general or specialty contractor,the contractor shall furnish to the state ora political subdivision of the state the following bonds,which become binding upon the award of the contract to that contractor: (1)a performance bond with a corporate surety qualified to do business in the state,or at least two individual sureties who shall each justify in a sum equal to the amount of the bond;the amount of the performance bond shall be equivalent to the amount of the payment bond; (2)a payment bond with a corporate surety qualified to do business in the state,or at least two individual sureties who shall each justify in a sum equal to the amount of the bond for the protection of all persons who supply labor and material in the prosecution of the work provided for in the contract; when the total amount payable by the terms of the contract is not more than $1,000,000,the payment bond shall be in a sum of one-half the total amount payable by the terms of the contract;when the total amount payable by the terms of the contract is more than $1,000,000 and not more than $5,000,000, the payment bond shall be in a sum of 40 percent of the total amount payable by the terms of the contract;when the total amount payable by the terms of the contract is more than $5,000,000,the payment bond shall be in the sum of $2,500,000. (b)This section does not limit the authority of a contracting officer to require a performance bond or other security in addition to those,or in cases other than the cases specified in (a)ofthis section. (c)When no payment bond has been furnished,the contracting department may not approve final payments to the contractor until the contractor files a written certification that all persons who supplied labor or material in the prosecution of the work provided for in the contract have been paid. Sec.36.25.020.Rights of persons furnishing labor or material. (a)A person who furnishes labor or material in the prosecution of the work provided for in the contract for which a payment bond is furnished under AS 36.25.010 and who is not paid in full before the expiration of 90 days after the last day on which the labor is performed or material is furnished for which the claim is made,may sue on the payment bond for the amount unpaid at the time ofthe suit. (b)However,a person having direct contractual relationships with a subcontractor but no contractual relationship express or implied with the contractor furnishing the payment bond has a right of action on the payment bond upon giving written notice to the contractor within 90 days from the last date on which the person performed labor or furnished material for which the claim is made.The notice Exhibit S-11 Page 1 of 2 must state with substantial accuracy the amount claimed and the name of the person to whom the material was furnished or for whom the labor was performed.The notice shall be served by mailing it by registered mail,postage prepaid,in an envelope addressed to the contractor at any place where the contractor maintains an office or conducts business,or the contractor's residence,or in any manner in which a peace officer is authorized to serve summons. (c)A suit brought under this section shall be brought in the name of the state or the political subdivision of the state for the use of the person suing in the court with jurisdiction.A suit under this section is subject to AS 08.18.151.A suit may not be started after the expiration of one year after the date of final settlement of the contract.The state or political subdivision of the state is not liable for costs or expenses of the suit. Exhibit S-11 Page 2 of 2 Exhibit S-12 Chapter 36.10.EMPLOYMENT PREFERENCE Sec.36.10.005.Legislative findings. (a)The legislature finds that (1)because of its unique climate and its distance from the contiguous states,the state has historically suffered from unique social,seasonal,geographic,and economic conditions that result in an unstable economy; (2)the unstable economy is a hardship on the residents of the state and is aggravated by the large numbers of seasonal and transient nonresident workers; (3)the rate of unemployment among residents of the state is one of the highest in the nation; (4)the state has one of the highest ratios of nonresident to resident workers in the nation; (5)the state has a compelling interest in reducing the level of unemployment among its residents; (6)the construction industry in the state accounts for a substantial percentage of the available employment; (7)construction workers receive a greater percentage of all unemployment benefits paid by the state than is typical of other states; (8)historically,the rate of unemployment in the construction industry in the state is higher than the rate of unemployment in other industries in the state; (9)it is appropriate for the state to consider the welfare of its residents when it funds construction activity; (10)it is in the public interest for the state to allocate public funds for capital projects in order to reduce unemployment among its resident construction workers; (11)the influx of nonresident construction workers contributes to or causes the high unemployment rate among resident construction workers because nonresident workers compete with residents for the limited number of available construction jobs; (12)nonresident workers displace a substantial number of qualified,available,and unemployed Alaska workers on jobs on state funded public works projects; (13)the state has a special interest in seeing that the benefits of state construction spending accrue to its residents; Exhibit S-12 Page 1 of 10 (14)the natural resources of land owned by the state belong to the citizens of the state; (15)Alaskans have chosen to use the majority of the royalties derived from the state's natural resources to fund state government; (16)the vast majority of the state's revenue is derived from natural resource income rather than from other forms of taxation; (17)because the state has no personal income tax or sales tax,nonresident workers use services provided by the state but do not contribute fairly to the costs of those services;and (18)Alaskans,more than the residents of other states,suffer economically when nonresidents displace qualified residents since resident workers contribute local taxes as well as their share of the royalties from natural resources. (b)The legislature further finds that (1)the state and its political subdivisions,when acting as a market participant in funding public works projects,should give Alaska residents an employment preference to promote a more stable economy; (2)the state and its political subdivisions have a duty of loyalty to their citizens and should fulfill this duty by giving residents preference for employment on public works projects they fund; (3)there is a legitimate and compelling governmental interest and that the public health and welfare will suffer if state residents are not afforded employment preference in state-funded construction-related work. (c)The legislature finds that the following factors are reasonable but not exclusive indicators of the ratio of nonresident to resident employees in the state: (1)the ratio of applicants for unemployment insurance who list out-of-state residences to applicants who list residences in the state; (2)the ratio of employees who are subject to unemployment insurance coverage and who did not apply for or were denied a permanent fund dividend to employees who were found eligible for a dividend. (d)The legislature finds that (1)the number of state residents who are unable to find work is considerably higher than is reflected by unemployment rates based on nationally accepted measures; (2)many rural state residents who wish to work do not seek employment as frequently as necessary to meet federal definitions of unemployment because of continuing lack of employment opportunities in rural areas of the state. Exhibit S-12 Page 2 of 10 Sec.36.10.006.Statement of purpose.[Repealed,Sec.16 ch 20 SLA 2002]. Repealed or Renumbered Sec.36.10.007.State policy. It is the policy of this state that,to fulfill the duty of loyalty owed to its citizens and to remedy social or economic problems,the state will grant an employment preference to residents when the state is acting as a market participant. Sec.36.10.010.Employment preference.[Repealed,Sec.11 ch 33 SLA 1986]. Repealed or Renumbered Sec.36.10.020.Apprentices. Apprentices must be properly registered apprentices in their particular craft. Sec.36.10.030.Reduction of work force. When a work force is reduced,resident workers,except supervisory personnel,shall be terminated last. Sec.36.10.040.Application to contracts involving federal funds. In a contract involving expenditure of federal aid funds,this chapter may not be enforced in a manner that conflicts with federal statutes giving preference to veterans or prohibiting other preferences or discriminations among United States citizens. Sec.36.10.050.Employment of aliens.[Repealed,Sec.17 ch 142 SLA 1972]. Repealed or Renumbered Sec.36.10.060.Employment of prisoners.(Repealed,Sec.6 ch 53 SLA 1982]. Repealed or Renumbered Sec.36.10.070.Unavailability of preferred workers. (a)An employer subject to hiring requirements under this chapter may request the Department of Labor and Workforce Development to assist in locating qualified,eligible employees.After receiving a request for assistance,the department shall refer qualified,eligible,available residents to the employer to fill the employer's hiring needs.The employer shall cooperate with the department. (b)If the department is unable to refer a sufficient number of qualified,eligible,available residents able to perform the work,the commissioner of labor and workforce development may approve the hiring of residents who are not eligible for preference and nonresidents for the balance of the request. Exhibit S-12 Page 3 of 10 Sec.36.10.075.Regulations. (a)The commissioner of labor and workforce development shall adopt regulations necessary to carry out the provisions of this chapter including but not limited to the method,time,and content of reporting by employers covered by this chapter and reporting provisions permitting on-going supervision by the Department of Labor and Workforce Development on all public works projects covered by this chapter. (b)The commissioner of labor and workforce development shall adopt regulations to encourage and require the hiring of residents to the maximum extent permitted by law. Sec.36.10.076.Notification by state or political subdivision. An agency or political subdivision of the state covered by the provisions of this chapter shall notify the Department of Labor and Workforce Development periodically regarding planned public works. Notification shall be in the form and manner prescribed by the Department of Labor and Workforce Development. Sec.36.10.080.Chapter incorporated in contracts. The provisions of this chapter are considered to be a part of every public works contract. Sec.36.10.090.Publication of list of violators. (a}The commissioner of labor and workforce development shall distribute to all departments and agencies of the state government and to all political subdivisions of the state a list of the names of persons or firms convicted of a violation of this chapter.A person appearing on the list or a firm, corporation,partnership,or association in which the person has an interest may not work as a contractor or subcontractor on a public construction contract for the state or a political subdivision until after three years from the date of publication of the list. (b)A local government or school district covered by the provisions of this chapter that is found to be in violation of these provisions may be required to forfeit all or part of the state aid made available for the project in which the violation occurs and in addition may be denied up to 12 months of state revenue sharing or public school funding.A state department or agency head found to be in violation of this chapter may be required to forfeit the position of department or agency head. (c)A person or governmental entity covered by the provisions of (b)of this section who is not satisfied by a decision of the Department of Labor and Workforce Development may,as the final administrative process,appeal the decision to a committee consisting of the commissioners of transportation and public facilities,labor,and workforce development,and administration.The commissioner of transportation and public facilities is the chairman of the committee.A quorum for conducting business is three members and any decision made must be supported by a majority of the committee members.The committee may,upon a showing of hardship,waive all or any part of the penalty provisions of this chapter. Exhibit S-12 Page 4 of 10 Sec.36.10.100.Retainage and penalty. (a)A contractor who violates a provision of this chapter shall have deducted from amounts due to the contractor under the contract the prevailing wages that should have been paid to a displaced resident,and these amounts shall be retained by the contracting agency. (b)A contractor or the agent of a contractor who violates a provision of this chapter is guilty of a misdemeanor,and upon conviction is punishable by a fine of not more than $500,or by imprisonment for not more than 90 days,or by both. Sec.36.10.110.Definitions.[Repealed,Sec.17 ch 142 SLA 1972]. Repealed or Renumbered Sec.36.10.120.Investigations and hearings. The Department of Labor and Workforce Development may,when necessary to enforce this chapter, (1)conduct investigations and hold hearings relating to employment preference; (2)compel the attendance of witnesses and the production of books,papers,and documents. Sec.36.10.125.Enforcement. (a)The attorney general shall,when requested by the Department of Labor and Workforce Development,enforce the provisions of this chapter.The attorney general may obtain a court order prohibiting a contractor or subcontractor violating this chapter from continuing to work on existing public construction contracts of the state or a political subdivision of the state.The state or political subdivision of the state may prosecute the work to completion by contract or otherwise,and the contractor or subcontractor and the sureties of the contractor or subcontractor are liable for excess costs for completing the work. (b)A private person is entitled to bring an action in the superior court to enforce the provisions of this chapter if that private person first gives at least 20 days notice to the commissioner of labor and workforce development.The notice must set out (1)the intent of the private person to bring an action under this subsection; (2)the specific violation complained of;and (3)the name ofthe person accused of the violation. (c)In an action brought under (b)of this section,the court may,in its discretion,order denial of state revenue sharing or public school funding,forfeiture of office or position,or injunctive or other relief.\f the court finds for the plaintiff in an action brought under (b)of this section,it may award the plaintiff an amount equal to the actual costs and attorney fees incurred by the plaintiff. Exhibit S-12 Page 5 of 10 Sec.36.10.130.Resident hire report. The attorney general and the commissioner of labor and workforce development shall report annually to the governor on the status of employment in the state,the effect of nonresident employment on the employment of residents in the state,and methods to increase resident hire.The report shall be submitted by January 31 of each year,and the governor shall notify the legislature that the report is available. Sec.36.10.140.Eligibility for preference;approval of job-training programs;certification. (a)A person is eligible for an employment preference under this chapter if the person certifies eligibility as required by the Department of Labor and Workforce Development,is a resident,and (1)is receiving unemployment benefits under AS 23.20 or would be eligible to receive benefits but has exhausted them; (2)is not working and has registered to find work with a public or private employment agency or a local hiring hall; (3)is underemployed or marginally employed as defined by the department;or (4)has completed a job-training program approved by the department and is either not employed or is engaged in employment that does not use the skills acquired in the job-training program. (b)In approving job-training programs under (a)of this section,the department shall use information and findings from other state and federal agencies as much as possible. (c)An employer subject to a resident hiring requirement under this chapter shall certify that persons employed as residents under the preference were eligible for the preference at the time of hiring. (d)A labor organization that dispatches members for work on a public works project under a collective bargaining agreement shall certify that persons dispatched as residents to meet a preference were eligible for the preference at the time of dispatch. (e)An employer or labor organization may request assistance from the Department of Labor and Workforce Development in verifying the eligibility of an applicant for a hiring preference under this chapter. Sec.36.10.150.Determination of zone of underemployment. (a)Immediately following a determination by the commissioner of labor and workforce development that a zone of underemployment exists,and for the next two fiscal years after the determination,qualified residents of the zone who are eligible under AS 36.10.140 shall be given preference in hiring for work on each project under AS 36.10.180 that is wholly or partially sited within the zone.The preference applies on a craft-by-craft or occupational basis. Exhibit S-12 Page 6 of 10 (b)The commissioner of labor and workforce development shall determine the amount of work that must be performed under this section by qualified residents who are eligible for an employment preference under AS 36.10.140.In making this determination,the commissioner shall consider the nature of the work,the classification of workers,availability of eligible residents,and the willingness of eligible residents to perform the work. (c)The commissioner shall determine that a zone of underemployment exists if the commissioner finds that (1)the rate of unemployment within the zone is substantially higher than the national rate of unemployment; (2)a substantial number of residents in the zone have experience or training in occupations that would be employed on a public works project; (3)the lack of employment opportunities in the zone has substantially contributed to serious social or economic problems in the zone;and (4)employment of workers who are not residents is a peculiar source of the unemployment of residents of the zone. Sec.36.10.160.Preference for residents of economically distressed zones. (a)Immediately following a determination by the commissioner that an economically distressed zone exists,and for the next two fiscal years after the determination,qualified residents of the zone who are eligible under AS 36.10.140 shall be given preference in hiring for at least 50 percent of employment on each project under AS 36.10.180 that is wholly or partially sited within the zone.The preference applies on a craft-by-craft or occupational basis. (b)The commissioner shall determine that an economically distressed zone exists if the commissioner finds that (1)the per capita income of residents of the zone is less than 90 percent of the per capita income of the United States as a whole,or the unemployment rate in the zone exceeds the national rate of unemployment by at least five percentage points; (2)the lack of employment opportunities in the zone has substantially contributed to serious social or economic problems in the zone;and (3)employment of workers who are not residents is a peculiar source of unemployment of residents of the zone. Sec.36.10.170.Preference for economically disadvantaged minority residents. (a)Immediately following a determination by the commissioner that the minority residents of a zone are economically disadvantaged,and for the next two fiscal years after the determination, Exhibit $-12 Page 7 of 10 qualified minority residents of the zone who are eligible under AS 36.10.140 shall be given preference in hiring for at least 25 percent,or a percent representative of the civilian minority residents in the zone, whichever is greater,of employment on each project under AS 36.10.180 that is wholly or partially sited within the zone.The preference applies on a craft-by-craft or occupational basis. (b)The commissioner shall determine that the minority residents of a zone are economically disadvantaged if the commissioner finds that (1)the percentage of civilian minority residents in the zone exceeds the percentage of civilian minority residents in the state; (2)either the percent of unemployment of civilian minority residents of the zone is at least two times the percent of unemployment of nonminority residents of the zone or the civilian minority population of the zone has suffered past economic discrimination; (3)the economic disadvantage of civilian minority residents of the zone has substantially contributed to serious social or economic problems in the zone;and (4)employment of workers who are not residents is a peculiar source of unemployment of civilian minority residents of the zone. (c)In this section,a person is considered to be a member of a minority if the person is Hispanic, Asian or Pacific Islander,American Indian or Alaskan Native,or Black as those terms are defined by the Equal Employment Opportunity Commission. Sec.36.10.175.Preference for economically disadvantaged female residents. (a)Immediately following a determination by the commissioner that the female residents of a zone are economically disadvantaged,and for the next two fiscal years after the determination, qualified female residents of the zone who are eligible under AS 36.10.140 shall be given preference in hiring for at least 25 percent of employment on each project under AS 36.10.180 that is wholly or partially sited within the zone.The preference applies on a craft-by-craft or occupational basis. (b)The commissioner shall determine that the female residents of a zone are economically disadvantaged if the commissioner finds that (1)either the percent of unemployment of female residents of the zone is at least two times the percent of unemployment of male residents of the zone or the female population of the zone has suffered past economic discrimination; (2)the economic disadvantage of female residents of the zone has substantially contributed to serious social or economic problems in the zone;and (3)employment of workers who are not residents is a peculiar source of unemployment of female residents of the zone. Exhibit S-12 Page 8 of 10 Sec.36.10.180.Projects subject to preference. (a)The preferences established in AS 36.10.150 -36.10.175 apply to work performed (1)under a contract for construction,repair,preliminary surveys,engineering studies, consulting,maintenance work,or any other retention of services necessary to complete a given project that is let by the state or an agency of the state,a department,office,state board,commission,public corporation,or other organizational unit of or created under the executive,legislative,or judicial branch of state government,including the University of Alaska and the Alaska Railroad Corporation,or by a political subdivision of the state including a regional school board with respect to an educational facility under AS 14.11.020; (2)on a public works project under a grant to a municipality under AS 37.05.315 or AS 37.06.010; (3)on a public works project under a grant to a named recipient under AS 37.05.316; (4)on a public works project under a grant to an unincorporated community under AS 37.05.317 or AS 37.06.020;and (5)on any other public works project or construction project that is funded in whole or in part by state money. (b)If the governor has declared an area to be an area impacted by an economic disaster under AS 44.33.285,then the preference for residents of the area established under AS 44,33.285 -44.33.310 supersedes the preference under AS 36.10.150 -36.10.175 for contracts awarded by the state. (c)The commissioner shall define the boundaries of a zone within which a preference applies. Sec.36.10.190.Reporting provisions. An employer obligated to meet resident hire requirements under this chapter shall comply with the reporting provisions that the commissioner of labor and workforce development determines are reasonably necessary to carry out this chapter.Except for statistical data,all information regarding specific employees is confidential and may not be released by the Department of Labor and Workforce Development.However,confidential employee information may be shared between departments for purposes of this chapter. Sec.36.10.200.Criminal penalties. (a)A person who makes a false sworn statement in connection with a certification of eligibility for an employment preference under this chapter is subject to criminal prosecution for perjury as provided in AS 11.56.200. Exhibit S-12 Page 9 of 10 (b)A person who makes an unsworn falsification,with the intent to mislead a public servant in the performance of a duty,in connection with a certification of eligibility for an employment preference under this chapter,is subject to criminal prosecution as provided in AS 11.56.210. Sec.36.10.210.Civil penalties. (a)In addition to any criminal penalties imposed,after a hearing the department may impose a civil penalty on a person who,in connection with certification of eligibility for an employment preference under this chapter, (1)made a false sworn statement;or (2)made an unsworn falsification with intent to mislead a public servant in the performance of a duty. (b)The amount of the civil penalty under (a)of this section for a person who falsely certifies that the person is eligible for an employment preference under this chapter is not more than $400 for each false certification. (c}The amount of the civil penalty under (a)of this section for an employer who falsely certifies that employees are residents eligible for a preference under this chapter is not more than $2,000 for each of the first five false certifications.The penalty for the sixth false certification made by an employer and for each false certification thereafter is at least $2,000 and not more than $4,000. Sec.36.10.900.Severability. If a provision of this chapter,or the application of a provision to a person or circumstance,is held invalid,the remainder of this chapter and the application to other persons or circumstances shall not be affected by the holding.The remainder shall be enforced to the greatest extent constitutionally permissible under the constitutions of the United States and the State of Alaska. Sec.36.10.990.Definitions. in this chapter, (1)"qualified"means possesses the requisite education,training,skills,or experience to perform the work; (2)"zone"includes a census area in the state,an economic region of the state,and the state as a whole. Exhibit $-12 Page 10 of 10 Exhibit S-13 Article 04.REQUIRED CONTRACT PROVISION Sec.36.90.300.Indemnification,defense,and hold harmless provision in certain construction-related contracts. (a)A public agency shall include in a construction-related professional services contract entered into by the public agency a provision under which the consultant agrees to indemnify,defend,and hold harmless the public agency from claims or liability for the negligent acts,errors,or omissions of the consultant.The provision must include an apportionment of the indemnification,defense,and hold harmless obligation on a comparative fault basis. (b)A provision that reads substantially as follows satisfies the requirement of (a)of this section: The consultant shall indemnify,defend,and hold harmless the contracting agency from and against any claim of,or liability for,negligent acts,errors,and omissions of the consultant under this agreement. The consultant is not required to indemnify,defend,or hold harmless the contracting agency for a claim of,or liability for,the independent negligent acts,errors,and omissions of the contracting agency.If there is a claim of,or liability for,a joint negligent act,error,or omission of the consultant and the contracting agency,the indemnification,defense,and hold harmless obligation of this provision shall be apportioned on a comparative fault basis.In this provision,"consultant"and "contracting agency" include the employees,agents,and contractors who are directly responsible,respectively,to each.In this provision,"independent negligent acts,errors,and omissions"means negligence other than in the contracting agency's selection,administration,monitoring,or controlling of the consultant,or in approving or accepting the consultant's work. (c)In this section, (1)"construction"means the process of building,altering,repairing,maintaining,improving, demolishing,planning,and designing a public highway,a structure,a building,a utility,infrastructure,or another public improvement to real property,but does not mean the routine operation of a public improvement; (2)"consultant”means a person who contracts with a public agency to provide professional services; (3)"professional services"has the meaning given in AS 36.30.990; (4)"public agency"means a department,institution,board,commission,division,authority, public corporation,committee,school district,political subdivision,or other administrative unit of a municipality,of a political subdivision,or of the executive or legislative branch of state government, including the University of Alaska,the Alaska Aerospace Corporation,the Alaska Housing Finance Corporation,the Alaska Industrial Development and Export Authority,the Alaska Energy Authority,the Alaska Railroad Corporation,and a regional educational attendance area. Exhibit S-13 Page 1of 1 Exhibit S-14 Chapter 39.52.ALASKA EXECUTIVE BRANCH ETHICS ACT Article 01.DECLARATIONS Sec.39.52.010.Declaration of policy. (a)It is declared that (1)high moral and ethical standards among public officers in the executive branch are essential to assure the trust,respect,and confidence of the people of this state; (2)a code of ethics for the guidance of public officers will (A)discourage those officers from acting upon personal or financial interests in the performance of their public responsibilities; (B)improve standards of public service;and (C)promote and strengthen the faith and confidence of the people of this state in their public officers; (3)holding public office or employment is a public trust and that as one safeguard of that trust, the people require public officers to adhere to a code of ethics; (4)a fair and open government requires that executive branch public officers conduct the public's business in a manner that preserves the integrity of the governmental process and avoids conflicts of interest; (5)in order for the rules governing conduct to be respected both during and after leaving public service,the code of ethics must be administered fairly without bias or favoritism; (6)no code of conduct,however comprehensive,can anticipate all situations in which violations may occur nor can it prescribe behaviors that are appropriate to every situation;in addition,laws and regulations regarding ethical responsibilities cannot legislate morality,eradicate corruption,or eliminate bad judgment;and (7)compliance with a code of ethics is an individual responsibility;thus all who serve the state have a solemn responsibility to avoid improper conduct and prevent improper behavior by colleagues and subordinates. (b)The legislature declares that it is the policy of the state,when a public employee is appointed to serve on a state board or commission,that the holding of such offices does not constitute the holding of incompatible offices unless expressly prohibited by the Alaska Constitution,this chapter and any opinions or decisions rendered under it,or another statute. Exhibit S-14 Page 1 of 22 Article 02.CODE OF ETHICS Sec.39.52.110.Scope of code;prohibition of unethical conduct. (a)The legislature reaffirms that each public officer holds office as a public trust,and any effort to benefit a personal or financial interest through official action is a violation of that trust.In addition, the legistature finds that,so long as it does not interfere with the full and faithful discharge of an officer's public duties and responsibilities,this chapter does not prevent an officer from following other independent pursuits.The legislature further recognizes that (1)in a representative democracy,the representatives are drawn from society and,therefore, cannot and should not be without personal and financial interests in the decisions and policies of government; (2)people who serve as public officers retain their rights to interests of a personal or financial nature;and (3)standards of ethical conduct for members of the executive branch need to distinguish between those minor and inconsequential conflicts that are unavoidable in a free society,and those conflicts of interests that are substantial and material. (b)Unethical conduct is prohibited,but there is no substantial impropriety if,as to a specific matter,a public officer's (1)personal or financial interest in the matter is insignificant,or of a type that is possessed generally by the public or a large class of persons to which the public officer belongs;or (2)action or influence would have insignificant or conjectural effect on the matter. (c})The attorney general,designated supervisors,hearing officers,and the personnel board must be guided by this section when issuing opinions and reaching decisions. (d)Stock or other ownership interest in a business is presumed insignificant if the value of the stock or other ownership interest,including an option to purchase an ownership interest,is less than 55,000. Sec.39.52.120.Misuse of official position. (a)A public officer may not use,or attempt to use,an official position for personal gain,and may not intentionally secure or grant unwarranted benefits or treatment for any person. (b)A public officer may not (1)seek other employment or contracts through the use or attempted use of official position; (2)accept,receive,or solicit compensation for the performance of official duties or responsibilities from a person other than the state; Exhibit S-14 Page 2 of 22 (3)use state time,property,equipment,or other facilities to benefit personal or financial interests; (4)take or withhold official action in order to affect a matter in which the public officer has a personal or financial interest; (5)attempt to benefit a personal or financial interest through coercion of a subordinate or require another public officer to perform services for the private benefit of the public officer at any time;or (6)use or authorize the use of state funds,facilities,equipment,services,or another government asset or resource for partisan political purposes;this paragraph does not prohibit use of the governor's residence for meetings to discuss political strategy and does not prohibit use of state aircraft or the communications equipment in the governor's residence so long as there is no charge to the state for the use;in this paragraph,"for partisan political purposes" (A)means having the intent to differentially benefit or harm a (i)candidate or potential candidate for elective office;or (ii)political party or group; (B)but does not include having the intent to benefit the public interest at large through the normal performance of official duties. (c)In addition to other provisions of this section,a public officer who is a member of the Board of Fisheries or the Board of Game may not act on a matter before the board if the public officer has not disclosed in the manner set out in AS 39.52.220 all personal or financial interests in a business or organization relating to fish or game resources. (d)In this section,when determining whether a public officer is considered to be performing a task on government time,the attorney general and personnel board shall consider the public officer's work schedule as set by the public officer's immediate supervisor,if any.A public officer other than the governor and lieutenant governor who,during the work days,engages in political campaign activities other than minor,inconsequential,and unavoidable campaign activities shall take approved leave for the period of campaigning. (e)Except for supplying information requested by the hearing officer or the entity with authority to make the final decision in the case,or when responding to contacts initiated by the hearing officer or the individual,board,or commission with authority to make the final decision in the case,a public officer may not attempt to influence the outcome of an administrative hearing by directly or indirectly contacting or attempting to contact the hearing officer or individual,board,or commission with authority to make the final decision in the case assigned to the hearing officer unless the (1)contact is made in the presence of all parties to the hearing or the parties'representatives and the contact is made a part of the record;or Exhibit S-14 Page 3 of 22 (2)fact and substance of the contact is promptly disclosed by the public officer to all parties to the hearing and the contact is made a part of the record. (f)Use of state aircraft for partisan political purposes is permitted under (b)of this section only when the use is collateral or incidental to the normal performance of official duties and does not exceed 10 percent ofthe total of the use of the aircraft for official purposes and partisan political purposes, combined,on a single trip.A public officer who authorizes or makes any partisan political use of a state aircraft under (b)of this section shall disclose the authorization and use under AS 39.52.210 or 39.52.220 for each trip,and the person who uses the aircraft shall reimburse the state for the proportionate share of the actual cost of the use. Sec.39.52.130.Improper gifts. (a)A public officer may not solicit,accept,or receive,directly or indirectly,a gift,whether in the form of money,service,loan,travel,entertainment,hospitality,employment,promise,or in any other form,that is a benefit to the officer's personal or financial interests,under circumstances in which it could reasonably be inferred that the gift is intended to influence the performance of official duties, actions,or judgment.A gift from a person required to register as a lobbyist under AS 24.45.041 toa public officer or a public officer's immediate family member is presumed to be intended to influence the performance of official duties,actions,or judgment unless the giver is an immediate family member of the person receiving the gift. (b)Notice of the receipt by a public officer of a gift with a value in excess of $150,including the name of the giver and a description of the gift and its approximate value,must be provided to the designated supervisor within 30 days after the date of its receipt (1)if the public officer may take or withhold official action that affects the giver;or (2)if the gift is connected to the public officer's governmental status. (c)In accordance with AS 39.52.240,a designated supervisor may request guidance from the attorney general concerning whether acceptance of a particular gift is prohibited. (d)The restrictions relating to gifts imposed by this section do not apply to a campaign contribution to a candidate for elective office if the contribution complies with laws and regulations governing elections and campaign disclosure. (e)A public officer who,on behalf of the state,accepts a gift from another government or from an official of another government shall,within 60 days after its receipt,notify the Office of the Governor in writing.The Office of the Governor shall determine the appropriate disposition of the gift.In this subsection,"another government"means a foreign government or the government of the United States, another state,a municipality,or another jurisdiction. (f)A public officer who knows or reasonably ought to know that a family member has received a gift because of the family member's connection with the public office held by the public officer shall report the receipt ofthe gift by the family member to the public officer's designated supervisor if the Exhibit S-14 Page 4 of 22 gift would have to be reported under this section if it had been received by the public officer or if receipt of the gift by a public officer would be prohibited under this section. Sec.39.52.140.Improper use or disclosure of information. (a)A current or former public officer may not disclose or use information gained in the course of,or by reason of,the officer's official duties that could in any way result in the receipt of any benefit for the officer or an immediate family member,if the information has not also been disseminated to the public. (b)A current or former public officer may not disclose or use,without appropriate authorization, information acquired in the course of official duties that is confidential by law. Sec.39.52.150.Improper influence in state grants,contracts,leases,or loans. (a)A public officer,or an immediate family member,may not attempt to acquire,receive,apply for,be a party to,or have a personal or financial interest in a state grant,contract,lease,or loan if the public officer may take or withhold official action that affects the award,execution,or administration of the state grant,contract,lease,or loan. (b)The prohibition in (a)of this section does not apply to a state grant,contract,or lease competitively solicited unless the officer (1)is employed by the administrative unit awarding the grant,contract,or lease or is employed by the administrative unit for which the grant,contract,or lease is let;or (2)takes official action with respect to the award,execution,or administration of the grant, contract,or lease. (c)The prohibition in (a)of this section does not apply to a state loan if (1)the public officer does not take or withhold official action that affects the award,execution, or administration of the loan held by the officer,or an immediate family member; (2)the loan is generally available to members of the public;and (3}the loan is subject to fixed eligibility standards. (d)A public officer shall report in writing to the designated supervisor a personal or financial interest held by the officer,or an immediate family member,in a state grant,contract,lease,or loan that is awarded,executed,or administered by the agency the officer serves. Sec.39.52.160.Improper representation. (a)A public officer may not represent,advise,or assist a person in any matter pending before the administrative unit that the officer serves,if the representation,advice,or assistance is Exhibit S-14 Page 5 of 22 (1)for compensation,unless the representation,advice,assistance,and compensation are required by statute,regulation,or court rule,or is otherwise customary;or (2)without compensation,but rendered to benefit a personal or financial interest of the public officer. (b)This section does not prohibit activities related to collective bargaining. (c)This section does not preclude a nonsalaried member of a board or commission from representing,advising,or assisting in any matter in which the member has a personal or financial interest regulated by the board or commission on which the member serves,except that the member must act in accordance with AS 39.52.220. Sec.39.52.170.Outside employment restricted. (a)A public employee may not render services to benefit a personal or financial interest or engage in or accept employment outside the agency which the employee serves,if the outside employment or service is incompatible or in conflict with the proper discharge of official duties. (b)A public employee rendering services for compensation,or engaging in employment outside the employee's agency,shall report by July 1 of each year the outside services or employment to the employee's designated supervisor.During the year,any change in an employee's outside service or employment activity must be reported to the designated supervisor as it occurs. (c)The head of a principal executive department of the state may not accept employment for compensation outside the agency that the executive head serves. Sec.39.52.180.Restrictions on employment after leaving state service. (a)A public officer who leaves state service may not,for two years after leaving state service, represent,advise,or assist a person for compensation regarding a matter that was under consideration by the administrative unit served by that public officer,and in which the officer participated personally and substantially through the exercise of official action.For the purposes of this subsection,"matter" includes a case,proceeding,application,contract,determination,proposal or consideration of a legislative bill,a resolution,a constitutional amendment,or other legislative measure,or proposal, consideration,or adoption of an administrative regulation. (b)This section does not prohibit an agency from contracting with a former public officer to act on a matter on behalf ofthe state. (c)The head of an agency may waive application of (a)of this section after determining that representation by a former public officer is not adverse to the public interest.The waiver must be in writing and a copy of the waiver must be provided to the attorney general for approval or disapproval. (d)An individual who formerly held a position listed in this subsection may not engage in activity as a lobbyist under AS 24.45 for a period of one year after leaving that position.This subsection does not prohibit service as a volunteer lobbyist described in AS 24.45.161(a)(1)or a representational lobbyist as Exhibit S-14 Page 6 of 22 defined under regulations of the Alaska Public Offices Commission.This subsection applies to the position of (1)governor; (2)lieutenant governor; (3)head or deputy head of a principal department in the executive branch; (4)director of a division or legislative liaison within a principal department in the executive branch; (5)legislative liaison,administrative assistant,or other employee ofthe Office of the Governor or Office of the Lieutenant Governor in a policy-making position; (6)member of a state board or commission that has the authority to adopt regulations,other than a board or commission named in AS 08.01.010; (7)member of the governing board and executive officer of a state public corporation. (e)A former head of a principal department in the executive branch may not,for a period of one year after leaving service as the head of that department,serve on the governing board of a company, organization,or other entity that was regulated by that department or with which the former department head worked as part of an official duty as the department head.A former employee of the Office of the Governor in a policy-making position may not,for a period of one year after leaving employment in that office,serve on the governing board of a company,organization,or other entity with which the former employee worked as part of an official duty for the Office of the Governor. (f)In this section,"employee of the Office of the Governor in a policy-making position"means a person who is an employee required,because ofthe person's position in the Office of the Governor,to file a statement under AS 39.50.020. Sec.39.52.190.Aiding a violation prohibited. It is a violation of this chapter for a public officer to knowingly aid another public officer in a violation of this chapter. Article 03.DISCLOSURE AND ACTION TO PREVENT VIOLATIONS Sec.39.52.210.Declaration of potential violations by public employees. (a)A public employee who is involved in a matter that may result in a violation of AS 39.52.110 - 39.52.190 shall (1)refrain from taking any official action relating to the matter until a determination is made under this section;and Exhibit S-14 Page 7 of 22 (2)immediately disclose the matter in writing to the designated supervisor and the attorney general. (b)A public employee's designated supervisor shall make a written determination whether an employee's involvement violates AS 39.52.110 -39.52.190 and shall provide a copy of the written determination to the public employee and to the attorney general.If the supervisor determines that a violation could exist or will occur,the supervisor shall, (1)reassign duties to cure the employee's potential violation,if feasible;or (2)direct the divestiture or removal by the employee of the personal or financial interests that give rise to the potential violation. (c)A designated supervisor may request guidance from the attorney general,in accordance with AS 39.52.240,when determining whether a public employee is involved in a matter that may result ina violation of AS 39.52.110 -39.52.190. Sec.39.52.220.Declaration of potential violations by members of boards or commissions. (a)A member of a board or commission who is involved in a matter that may result in a violation of AS 39.52.110 -39.52.190 shall disclose the matter on the public record and in writing to the designated supervisor and to the attorney general.The supervisor shall determine whether the member's involvement violates AS 39.52.110 -39.52.190 and shall provide a copy of the written determination to the board or commission member and to the attorney general.If a member of the board or commission objects to the ruling of the supervisor,or if the supervisor discloses an involvement requiring a determination,the members present at a meeting,excluding the involved member,shall vote on the matter.If the supervisor or a majority of the members voting determine that a violation will exist if the member continues to participate,the member shall refrain from voting, deliberating,or participating in the matter. (b)The designated supervisor or the board or commission may request guidance from the attorney general,in accordance with AS 39.52.240,when determining whether a member of a board or commission is involved in a matter that may result in a violation of AS 39.52.110 -39.52.190. Sec.39.52.225.Disclosures in connection with executive clemency. Before granting executive clemency to an applicant for executive clemency,the governor shall disclose in writing to the attorney general whether granting the clemency would benefit a personal or financial interest of the governor.The attorney general shall publish a written determination whether granting executive clemency to the applicant would violate AS 39.52.110 -39.52.190.The written determination of the attorney general is not confidential,but information set out in that determination identifying a person,other than the applicant for clemency,who is a victim or witness in a criminal matter may not be made public. Exhibit S-14 Page 8 of 22 Sec.39.52.230.Reporting of potential violations. A person may report to a public officer's designated supervisor,under oath and in writing,a potential violation of AS 39.52.110 -39.52.190 by the public officer.The supervisor shall provide a copy of the report to the officer who is the subject of the report and to the attorney general,and shall review the report to determine whether a violation may exist.The supervisor shall act in accordance with AS 39.52.210 or 39.52.220 if the supervisor determines that the matter may result in a violation of AS 39.52.110 -39.52.190. Sec.39.52.240.Advisory opinions. (a)Upon the written request of a designated supervisor or a board or commission,the attorney general shall issue opinions interpreting this chapter.The requester must supply any additional information requested by the attorney general in order to issue the opinion.Within 60 days after receiving a complete request,the attorney general shall issue an advisory opinion on the question. (b)The attorney general may offer oral advice if delay would cause substantial inconvenience or detriment to the requesting party. (c)The designated supervisor or a board or commission shall make a written determination based on the advice ofthe attorney general.!f the advice of the attorney general provides more than one way for a public officer to avoid or correct a problem found under AS 39.52.110 -39.52.190,the designated supervisor or the board or commission shall,after consultation with the officer,determine the alternative that is most appropriate and advise the officer of any action required of the officer to avoid or correct the problem. (d)A public officer is not liable under this chapter for any action carried out in accordance with a determination made under AS 39.52.210 -39.52.240 if the officer fully disclosed all relevant facts reasonably necessary to the determination. (e)The attorney general may reconsider,revoke,or modify an advisory opinion at any time, including upon a showing that material facts were omitted or misstated in the request for the opinion. (f)A person may rely on an advisory opinion that is currently in effect. (g)A request for advice made under (a)of this section is confidential. (h)The attorney general shall post on the Alaska Online Public Notice System (AS 44.62.175), with sufficient deletions to prevent disclosure of the persons whose identities are confidential under (g) of this section,the advisory opinions issued under this section that the attorney general determines to be of major import because oftheir general applicability to executive branch officers. Sec.39.52.250.Advice to former public officers. (a)A former public officer may request,in writing,an opinion from the attorney general interpreting this chapter.The attorney general shall give advice in accordance with AS 39.52.240(a)or (b)and publish opinions in accordance with AS 39.52.240(h). Exhibit S-14 Page 9 of 22 (b)A former public officer is not liable under this chapter for any action carried out in accordance with the advice of the attorney general issued under this section,if the public officer fully disclosed all relevant facts reasonably necessary to the issuance ofthe advice. Sec.39.52.260.Designated supervisor's report and attorney general review. (a)A designated supervisor shall quarterly submit a report to the attorney general which states the facts,circumstances,and disposition of any disclosure made under AS 39.52.210 -39.52.240. (b)The attorney general shall review determinations reported under this section.The attorney general may request additional information from a supervisor concerning a specific disclosure and its disposition. (c)The report prepared under this section is confidential and not available for public inspection unless formal proceedings under AS 39.52.350 are initiated based on the report.If formal proceedings are initiated,the relevant portions of the report are public documents open to inspection.The attorney general shall,however,make available to the public a summary of the reports received under this section,with sufficient deletions to prevent disclosure of a person's identity. (d)The attorney general shall submit to the personnel board a copy of the quarterly reports received from designated supervisors under (a)of this section together with a report on the attorney general's review conducted under (b)of this section. Sec.39.52.270.Disclosure statements. (a)A public officer required to file a disclosure statement under this chapter shall meet the requirements of this subsection in making the disclosure.When the public officer files a disclosure statement under this chapter,the public officer signing the disclosure shall certify that,to the best of the public officer's knowledge,the statement is true,correct,and complete.The disclosure must state that,in addition to any other penalty or punishment that may apply,a person who submits a false statement that the person does not believe to be true is punishable under AS 11.56.200 -11.56.240. (b)A designated supervisor who receives a disclosure statement under AS 39.52.110 -39.52.220 shall review it.If the designated supervisor believes that there is a possibility that the activity or situation reported in a disclosure statement filed under AS 39.52.110 -39.52.190 may result in a violation of this chapter,the designated supervisor shall take appropriate steps under AS 39.52.210 - 39.52.240.Failure of the designated supervisor to proceed under AS 39.52.210 -39.52.240 does not relieve the public officer of the public officer's obligations under those statutes. (c)In this section,"disclosure statement"means a report or written notice filed under AS 39.52.110 -39.52.220. Article 04.COMPLAINTS;HEARING PROCEDURES Exhibit $-14 Page 10 of 22 Sec.39.52.310.Complaints. (a)The attorney general may initiate a complaint,or elect to treat as a complaint,any matter disclosed under AS 39.52.210,39.52.220,39.52.250,or 39.52.260.The attorney general may not,during a campaign period,initiate a complaint concerning the conduct of the governor or lieutenant governor who is a candidate for election to state office. (b)A person may file a complaint with the attorney general regarding the conduct of a current or former public officer.A complaint must be in writing,be signed under oath,and contain a clear statement of the details of the alleged violation. (c)If a complaint alleges a violation of AS 39.52.110 -39.52.190 by the governor,lieutenant governor,or the attorney general,the matter shall be referred to the personnel board.The personnel board shall return a complaint concerning the conduct of the governor or lieutenant governor who is a candidate for election to state office as provided in (j)of this section if the complaint is initiated during a campaign period.The personnel board shall retain independent counsel who shall act in the place of the attorney general under (d)-(i)of this section,AS 39.52.320 -39.52.350,and 39.52.360(c)and (d). Notwithstanding AS 36.30.015(d),the personnel board may contract for or hire independent counsel under this subsection without notifying or securing the approval of the Department of Law. (d)The attorney general shall review each complaint filed,to determine whether it is properly completed and contains allegations which,if true,would constitute conduct in violation of this chapter. The attorney general may require the complainant to provide additional information before accepting the complaint.If the attorney general determines that the allegations in the complaint do not warrant an investigation,the attorney general shall dismiss the complaint with notice to the complainant and the subject of the complaint. (e)The attorney general may refer a complaint to the subject's designated supervisor for resolution under AS 39.52.210 or 39.52.220. (f)If the attorney general accepts a complaint for investigation,the attorney general shall serve a copy of the complaint upon the subject of the complaint,for a response.The attorney general may require the subject to provide,within 20 days after service,full and fair disclosure in writing of all facts and circumstances pertaining to the alleged violation.Misrepresentation of a material fact in a response to the attorney general is a violation of this chapter.Failure to answer within the prescribed time,or within any additional time period that may be granted in writing by the attorney general,may be considered an admission of the allegations in the complaint. (g)If a complaint is accepted under (f)of this section,the attorney general shall investigate to determine whether a violation of this chapter has occurred.At any stage of an investigation or review, the attorney general may issue a subpoena under AS 39.52.380. (h)A violation of this chapter may be investigated within two years after discovery ofthe alleged violation. Exhibit S-14 Page 11 of 22 (i)The unwillingness of a complainant to assist in an investigation,the withdrawal of a complaint,or restitution by the subject of the complaint may,but need not in and of itself,justify termination of an investigation or proceeding. (j)The personnel board shall return a complaint concerning the conduct of the governor or lieutenant governor who is a candidate for state office received during a campaign period to the complainant unless the governor or lieutenant governor,as appropriate,permits the personnel board to assume jurisdiction under this subsection.If the personnel board receives a complaint concerning the conduct of the governor or lieutenant governor who is a candidate during the campaign period,the personnel board shall immediately notify the subject of the complaint of the receipt of the complaint,of the suspension of the personnel board's jurisdiction during the campaign period,and of the candidate's right to waive the suspension of jurisdiction under this subsection.The candidate may,within 11 days after the personnel board mails or otherwise sends notice of the complaint to the candidate,notify the personnel board that the candidate chooses to have the personnel board proceed with the complaint under this section.If the candidate does not act within that time or if the candidate notifies the personnel board that the candidate is not waiving the suspension of jurisdiction,the personnel board shall return the complaint to the complainant with notice of the suspension ofjurisdiction under this subsection and of the right of the complainant to file the complaint after the end of the campaign period. (k)A campaign period under this section begins on the later of 45 days before a primary election in which the governor or lieutenant governor is a candidate for state office or the day on which the individual files as a candidate for state office and ends at the close of election day for the general or special election in which the individual is a candidate or on the day that the candidate withdraws from the election,if earlier.For a candidate who loses in the primary election,the campaign period ends on the day that results of the primary election showing that another individual won the election are certified. Sec.39.52.320.Dismissal before formal proceedings. If,after investigation,it appears that there is no probable cause to believe that a violation of this chapter has occurred,the attorney general shall dismiss the complaint.The attorney general shall communicate disposition of the matter promptly to the complainant under AS 39.52.335(c)and to the subject of the complaint. Sec.39.52.330.Corrective or preventive action. After determining that the conduct of the subject of a complaint does not warrant a hearing under AS 39,52.360,the attorney general shall recommend action to correct or prevent a violation of this chapter. The attorney general shall communicate the recommended action to the complainant and the subject of the complaint.The subject of the complaint shall comply with the attorney general's recommendation. Exhibit S-14 Page 12 of 22 Sec.39.52.335.Summary of disposition of complaints and review by personnel board. (a)When the attorney general initiates or receives a complaint under AS 39.52.310,the attorney general shall immediately forward a copy of the complaint to the personnel board. (b)Each month,the attorney general shall file a report with the personnel board concerning the status of each pending complaint and the resolution of complaints that have been closed since the previous report. (c)If a complaint is dismissed under AS 39.52.320 or resolved under AS 39.52.330,the attorney general shall promptly prepare a summary of the matter and provide a copy of the summary to the personnel board and the complainant.The summary is confidential unless the (1)dismissal or resolution agreed to under AS 39.52.320 or 39.52.330 is public;or (2)superior court makes the matter public under (h)of this section. (d)Within 15 days after receipt of a summary under this section,a complainant may file comments with the personnel board regarding the disposition of the complaint. (e)At its next regular meeting that begins more than 15 days after receipt of a summary under this section,the personnel board shall review the summary and comments,if any,filed by the complainant.The personnel board may compel the attendance of the subject of the complaint or the complainant at the meeting and may compel the production of documents.Attendance may be by teleconference.The attorney general or the attorney general's designee shall be available to respond to questions from the personnel board concerning the disposition of the complaint. (f)After review of the summary,the personnel board may issue a report on the disposition of the complaint.If the matter is confidential and the board determines that publication of the name ofthe subject is in the public interest,the report may include a recommendation that the matter be made public. (g)If the summary is confidential under (c)of this section, (1)comments filed by the complainant,if any,are confidential; {2}the personnel board shall conduct the review of the summary in executive session;and (3)the personnel board report,if any,is confidential;the personnel board shall make available to the public an expurgated copy ofa confidential report with sufficient deletions and editing to prevent disclosure of the identity of the persons involved in the matter. (h)If the disposition of a complaint is not made public and the personnel board report under (f) of this section includes a recommendation that the matter be made public,an interested party may file an action against the state in superior court requesting that the court make public the complaint,the attorney general's disposition of the complaint,and the personnel board report.The court may order the matter or portions of the matter made public if the court determines that Exhibit S-14 Page 13 of 22 (1)the dismissal or resolution of the complaint was clearly contrary to the requirements of this chapter; (2)one or more of the allegations in the information to be released is supported by substantial evidence; (3)the matter concerns the public interest;and (4)release of the information will not infringe on any protected rights or liberties of the subject. Sec.39.52.340.Confidentiality. (a)Except as provided in AS 39.52.335,before the initiation of formal proceedings under AS 39.52.350,the complaint and all other documents and information regarding an investigation conducted under this chapter or obtained by the attorney general during the investigation are confidential and not subject to inspection by the public.In the case of a complaint concerning the governor,lieutenant governor,or attorney general,all meetings of the personnel board concerning the complaint and investigation before the determination of probable cause are closed to the public.tf,in the course of an investigation or probable cause determination,the attorney general finds evidence of probable criminal activity,the attorney general shall transmit a statement and factual findings limited to that activity to the appropriate law enforcement agency.If the attorney general finds evidence of a probable violation of AS 15.13,the attorney general shall transmit a statement to that effect and factual findings limited to the probable violation to the Alaska Public Offices Commission.The attorney general and all persons contacted during the course of an investigation shall maintain confidentiality regarding the existence of the investigation. (b)It is not a violation of this section for a person to contact an attorney or to participate ina criminal investigation. (c)The subject of the complaint may,in writing,waive the confidentiality protection ofthis section. Sec.39.52.350.Probable cause for hearing. (a)If the attorney general determines that there is probable cause to believe that a knowing violation of this chapter or a violation that cannot be corrected under AS 39.52.330 has occurred,or that the subject of a complaint failed to comply with a recommendation for corrective or preventive action, the attorney general shall initiate formal proceedings by serving a copy of an accusation upon the subject of the accusation.The accusation shall specifically set out the alleged violation.After service,the accusation is a public document open to inspection.Except as provided in AS 39.52.370(c),all subsequent proceedings are open to the public. (b)The subject of the accusation shall file an answer with the attorney general within 20 days after service of the accusation,or at a later time specified by the attorney general.If the subject of the accusation fails to timely answer,the allegations are considered admitted. Exhibit S-14 Page 14 of 22 (c)If the subject of the accusation denies that a violation of this chapter has occurred,the attorney general shall refer the matter to the personnel board,which shall notify the chief administrative law judge (AS 44.64.010),who shall appoint an administrative law judge to serve as a hearing officer to conduct a hearing. (d)If the subject of the accusation admits a violation of this chapter,the attorney general shall refer the matter to the personnel board to impose penalties under AS 39.52.410,39.52.440,and 39.52.450,as appropriate. Sec.39.52.360.Hearings. (a)The hearing officer may convene a prehearing conference to set a time and place for the hearing,and for stipulation as to matters of fact and to simplify issues,identify and schedule prehearing matters,and resolve other similar matters before the hearing. (b)The hearing officer may administer oaths,hold hearings,and take testimony.Upon application by a party to the hearing,the hearing officer may issue subpoenas under AS 39.52.380. (c)The attorney general shall present the charges before the hearing officer.At a hearing,the attorney general has the burden of demonstrating by a preponderance of the evidence that the subject of the accusation has,by act or omission,violated this chapter. (d)The parties to a hearing are the attorney genera!and the subject of the accusation.The subject of an accusation may be represented by counsel.Each party has an opportunity to be heard and cross-examine witnesses,who shall testify under oath. (e)The Administrative Procedure Act does not apply to hearings under this section,except as provided in AS 39.52.380. (f)Technical rules of evidence do not apply,but the hearing officer's findings must be based upon reliable and relevant evidence.All testimony and other evidence taken at the hearing must be recorded and the evidence maintained.Copies of transcripts of the hearing record are available to the subject of the accusation at the subject's expense;however,upon request,a copy ofthe recording of the hearing must be furnished without charge to the subject of the accusation. (g)At the conclusion of the formal hearing,the hearing officer may direct either or both parties to submit proposed findings of fact,conclusions of law,and recommendation to be filed within 10 days after the conclusion of the hearing. (h)Within 30 days after the conclusion of a formal hearing,the hearing officer shall serve a written report on the personnel board and the parties,unless the personnel board grants an extension of time.The report must contain the officer's findings of fact,conclusions of law,and recommendation. The hearing officer shall submit the record to the personnel board. Exhibit S-14 Page 15 of 22 Sec.39.52.370.Personnel board action. (a)Within 10 days after receipt of the hearing officer's report,either party may protest the officer's findings of fact,conclusions of law,and recommendation,and,if a protest is filed,shall serve a copy on the other party.Oral argument before the personnel board must be provided only if requested by either party.The board chair shall set the deadline for submission of requests for oral argument,and set the dates for submission of briefs and oral argument before the board,if requested. (b)The board may issue subpoenas under AS 39.52.380,and may,for good cause shown, augment the hearing record,in whole or in part,or hold a hearing de novo. (c)The personnel board shall review each report submitted by a hearing officer and shall either adopt or amend the findings of fact,conclusions of law,and recommendation of the officer. Deliberations of the personnel board must be conducted in sessions not open to the public. (d)If the personnel board determines that a violation occurred,it may impose the penalties in AS 39.52.410,39.52.440,and 39.52.450,as appropriate.If the board determines that no violation occurred,the board shall issue a written order of dismissal. (e)The personnel board secretary shall promptly notify the parties and the public officer's designated supervisor of the board's action. (f)The subject of the accusation may appeal the personnel board's decision by filing an appeal in the superior court as provided in the Alaska Rules of Appellate Procedure. Sec.39.52.380.Subpoenas. (a)As provided in AS 39.52.310(g),39.52.360(b),and 39.52.370(b),the attorney general, independent counsel retained under AS 39.52.310(c),a hearing officer,the subject of an accusation,and the personnel board may summon witnesses and require the production of records,books,and papers by the issuance of subpoenas. (b)Subpoenas must be served in the manner prescribed by AS 44.62.430 and Rule 45 of the Alaska Rules of Civil Procedure.Failure or refusal to obey a subpoena issued under this chapter is punishable as contempt in the manner provided by law and court rule.The superior court may compel obedience to the subpoena in the same manner as prescribed for obedience to a subpoena issued by the court. Sec.39.52.390.Service. Service of an accusation must be accomplished in accordance with Rule 4 of the Alaska Rules of Civil Procedure.Service of any other pleading,motion,or other document must be accomplished in accordance with Rule 5 ofthe Alaska Rules of Civil Procedure. Article 05.ENFORCEMENT;REMEDIES Exhibit S-14 Page 16 of 22 Sec.39.52.410.Violations;penalties for misconduct. (a)If the personnel board determines that a public employee has violated this chapter,it (1)shall order the employee to stop engaging in any official action related to the violation; (2)may order divestiture,establishment of a blind trust,restitution,or forfeiture;and (3)may recommend that the employee's agency take disciplinary action,including dismissal. (b)If the personnel board determines that a nonsalaried member of a board or commission has violated this chapter,it (1)shall order the member to refrain from voting,deliberating,or participating in the matter;(2)may order restitution;and (3)may recommend to the appropriate appointing authority that the member be removed from the board or commission.A violation of this chapter is grounds for removal of a board or commission member for cause.If the personnel board recommends that a board or commission member be removed from office,the appointing authority shall immediately act to remove the member from office. (c)If the personnel board determines that a former public officer has violated this chapter,it shall (1)issue a public statement of its findings,conclusions,and recommendation;and (2)request the attorney general to exercise all legal and equitable remedies available to the state to seek whatever relief is appropriate. (d)If the personnel board finds a violation of this chapter by a public officer removable from office only by impeachment,it shall file a report with the president of the Senate,with its finding.The report must contain a statement of the facts alleged to constitute the violation. Sec.39.52.420.Disciplinary action for violation. (a)In addition to any other cause an agency may have to discipline a public employee,an agency may reprimand,demote,suspend,discharge,or otherwise subject an employee to agency disciplinary action commensurate with the violations of this chapter.This section does not prohibit the review of a disciplinary action in the manner prescribed by an applicable collective bargaining agreement or personnel statute or rule. (b)An agency may initiate appropriate disciplinary action in the absence of an accusation under this chapter or during the pendency of a hearing or personnel board action. Sec.39.52.430.Actions voidable. (a)In addition to any other penalty provided by law,a state grant,contract,or lease entered into in violation of this chapter is voidable by the state.In a determination under this section of whether to void a grant,contract,or lease,the interests of third parties who could be damaged may be taken into account.The attorney general shall give notice of intent to void a state grant,contract,or lease Exhibit S-14 Page 17 of 22 under this section no later than 30 days after the personnel board's determination of a violation under this chapter. (b)In addition to any other penalty provided for by law,the state may require a state loan received in violation of this chapter to become immediately payable. (c)Any state action taken in violation of this chapter is voidable,except that the interests of third parties and the nature ofthe violation may be taken into account.The attorney general may pursue any other available legal and equitable remedies. (d)The attorney general may recover any fee,compensation,gift,or benefit received by a person as a result of a violation of this chapter by a current or former public officer.Action to recover under this subsection must be brought within two years after discovery ofthe violation. Sec.39.52.440.Civil penalties. The personnel board may impose on a current or former public officer civil penalties not to exceed 55,000 for a violation of this chapter.A penalty imposed under this section is in addition to and not instead of any other penalty that may be imposed according to law. Sec.39.52.450.Payment of twice the financial benefit. The personnel board may,in addition to the civil penalties described in this chapter,require a current or former public officer who has financially benefited a person in violation of this chapter to pay to the state up to twice the amount that the person realized from the violation. Sec.39.52.460.Criminal sanctions additional. To the extent that violations under this chapter are punishable in a criminal action,that sanction is in addition to the civil remedies set out in this chapter. Article 06.GENERAL PROVISIONS Sec.39.52.910.Applicability. (a)Except as specifically provided,this chapter applies to all public officers within executive- branch agencies,including members of boards or commissions.This chapter does not apply to (1)a former public officer of an executive-branch agency unless a provision specifically states that it so applies; (2)legislators covered by AS 24.60;or (3)the University of Alaska and an employee of the University of Alaska as to activities or employment under a contract between the employee and the university described in AS 14.40.210(a)(4). (b)The provisions of this chapter supersede the common taw on conflicts of interests that may apply to a public officer of an executive branch agency and any personnel rules relating to conflicts of Exhibit S-14 Page 18 of 22 interests,excluding nepotism,adopted under AS 39.25.However,nothing in this chapter precludes a prosecution under an applicable criminal statute nor prevents enforcement of any other state law that imposes a stricter standard of ethical conduct on public officers. (c)The provisions of this chapter are not subject to negotiation by collective bargaining under AS 23.40. (d)Nothing in this chapter (1)supersedes AS 39.90.020;or (2)precludes an immediate family member of a public employee from employment in the same agency or administrative unit as that public employee,so long as the public employee does not have authority to take or withhold official action affecting the terms or conditions of the immediate family member's employment in a manner that violates state law. Sec.39.52.920.Agency policies. Subject to the review and approval of the attorney general,an agency may adopt a written policy that, in addition to the requirements of this chapter,limits the extent to which a public officer in the agency or an administrative unit of the agency may (1)acquire a personal interest in an organization or a financial interest in a business or undertaking that may benefit from official action taken or withheld by the agency or unit; (2)have a personal or financial interest in a state grant,contract,lease,or loan administered by the agency or unit;or (3)accept a gift. Sec.39.52.930.Cooperation. All agencies and instrumentalities of the state shall cooperate fully with the attorney general and the personnel board in the performance of their duties under this chapter. Sec.39.52.940.Construction. This chapter shall be construed to promote high standards of ethical conduct in state government. Sec.39.52.950.Regulations. The attorney general may adopt regulations under the Administrative Procedure Act necessary to interpret and implement this chapter. Sec.39.52.960.Definitions. In this chapter,unless the context requires otherwise, Exhibit S-14 Page 19 of 22 (1)"administrative unit"means a branch,bureau,center,committee,division,fund,office, rogram,section,or any other subdivision of an agency;y y (2)"agency”means a department,office of the governor,or entity in the executive branch, including but not limited to the University of Alaska,public or quasi-public corporations,boards or commissions,and the Alaska Railroad Corporation; (3)"benefit"means anything that is to a person's advantage or self-interest,or from which a person profits,regardless of the financial gain,including any dividend,pension,salary,acquisition, agreement to purchase,transfer of money,deposit,loan or loan guarantee,promise to pay,grant, contract,lease,money,goods,service,privilege,exemption,patronage,advantage,advancement,or anything of value; (4)"board or commission”means a board,commission,authority,or board of directors of a public or quasi-public corporation,established by statute in the executive branch,including the Alaska Railroad,but excluding members of a negotiated regulation making committee under AS 44.62.710 - 44.62.800; (5)"business"includes a corporation,company,firm,partnership,sole proprietorship,trust or foundation,or any other individual or entity carrying on a business,whether operated for profit or nonprofit; (6)"child"includes a biological child,an adopted child,and a stepchild; (7)"compensation"means any money,thing of value,or economic benefit conferred on or received by a person in return for services rendered or to be rendered by the person for another; (8)"designated supervisor"or "supervisor"means (A)the commissioner of each department in the executive branch,for public employees within the department; (B)the president of the University of Alaska,for university employees; (C)the attorney general,for the governor and lieutenant governor; (D)the executive director of a board or commission for the staff of the board or commission; (E)the chair or acting chair of the board or commission,for the members and the executive director of a board or commission;and (F)the governor,for commissioners and for other public officers not included in (A)-(E)of this paragraph;or (G)a public officer designated by a commissioner,the university president,or the governor to act as the supervisor if the name and position of the officer designated has been reported to the attorney general; Exhibit S-14 Page 20 of 22 (9)"financial interest"means (A)an interest held by a public officer or an immediate family member,which includes an involvement or ownership of an interest in a business,including a property ownership,or a professional or private relationship,that is a source of income,or from which,or as a result of which,a person has received or expects to receive a financial benefit; (B)holding a position in a business,such as an officer,director,trustee,partner,employee,or the like,or holding a position of management; (10)"gain"includes actual or anticipated gain,benefit,profit,or compensation; (11)"immediate family member"means (A)the spouse of the person; (B)another person cohabiting with the person in a conjugal relationship that is not a legal marriage; (C)a child,including a stepchild and an adopted child,of the person; (D)a parent,sibling,grandparent,aunt,or uncle of the person;and (E)a parent or sibling of the person's spouse; (12)"instrumentality of the state"means a state agency or administrative unit,whether in the legislative,judicial,or executive branch,including such entities as the University of Alaska,the Alaska Railroad,and any public or quasi-public corporations,boards,or commissions;the term includes municipalities; (13)"nonsalaried member of a board or commission"means a member of a board or commission who is not a public employee by virtue of membership on a board or commission;receipt of per diem,nominal compensation for attendance at meetings,and travel expense reimbursement does not make a member of a board or commission a public employee for purposes of this chapter; (14)"official action"means advice,participation,or assistance,including,for example,a recommendation,decision,approval,disapproval,vote,or other similar action,including inaction,by a public officer; (15)"organization"includes a group,association,society,political party,or other entity made up of two or more persons,whether operated for profit or nonprofit; (16)"parent"includes a biological parent,an adoptive parent,and a stepparent of the public officer; (17)"person"includes a natural person,a business,and an organization; Exhibit S-14 Page 21 of 22 (18)"personal interest"means an interest held or involvement by a public officer,or the officer's immediate family member or parent,including membership,in any organization,whether fraternal,nonprofit,for profit,charitable,or political,from which,or as a result of which,a person or organization receives a benefit; (19)"personnel board”or "board"means the personnel board established in AS 39.25.060; (20)"public employee"or "employee"means a permanent,probationary,seasonal,temporary, provisional,or nonpermanent employee of an agency,whether in the classified,partially exempt,or exempt service; (21)"public officer"or "officer"means (A)a public employee; (B)a member of a board or commission;and (C)a state officer designated by the governor to act as trustee of the trust or a person to whom the trustee has delegated trust duties;in this paragraph,"trust"has the meaning given in AS 37.14.450; (22)"source of income”means an entity for which service is performed for compensation or which is otherwise the origin of payment;if the person whose income is being reported is employed by another,the employer is the source of income;if the person is self-employed by means of a sole proprietorship,partnership,professional corporation,or a corporation in which the person,the person's spouse or child,or a combination of them,holds a controlling interest,the "source"is the client or customer ofthe proprietorship,partnership,or corporation;if the entity which is the origin of payment is not the same as the client or customer for whom the service is performed,both are considered the source. Sec.39.52.965.Short title. This chapter may be cited as the Alaska Executive Branch Ethics Act. Exhibit S-14 Page 22 of 22 Exhibit S-15 Chapter 44.64.HEARING OFFICERS AND OFFICE OF ADMINISTRATIVE HEARINGS Sec.44.64.010.Office created. (a)There is created in the Department of Administration an independent office of administrative hearings under the direction of the chief administrative law judge. (b)The chief administrative law judge must (1)be a resident of the state; (2)have experience in administrative law; (3)be licensed to practice law in this state and have been admitted to practice law in this state for at least five years;and (4)have experience representing clients in administrative orjudicial proceedings. (c)The chief administrative law judge is appointed to a five-year term of office by the governor and is subject to confirmation by the legislature.An individual may serve not more than three full or partial terms as chief administrative law judge.The governor may remove the chief administrative law judge from office only for good cause.The basis for removal shall be stated in writing.A vacancy in the office of chief administrative law judge shall be filled by the governor,and the individual appointed serves for the remainder of the term to which appointed. (d)The chief administrative law judge shall receive a monthly salary that is not less than Step A nor more than Step F,Range 27,of the salary schedule in AS 39.27.011(a)for Juneau,Alaska.The chief administrative law judge is in the partially exempt service. Sec.44.64.020.Powers and duties of chief administrative law judge. (a)The chief administrative law judge shall (1)supervise the office; (2)employ administrative staff,who shall be in the classified service; (3)employ administrative law judges,who shall be in the partially exempt service; (4)preside over administrative hearings handled by the office or,based upon the qualifications and expertise of the administrative law judges,assign administrative law judges to preside over hearings,and protect,support,and enhance the decisional independence of the administrative law judges; (5)establish and implement performance standards,including provision for timeliness,and peer review programs for administrative law judges employed or retained by the office; Exhibit $-15 Page 1 of 10 (6)make available and facilitate training and continuing education programs and services in administrative procedure,administrative adjudication,substantive law,alternate dispute resolution,and technical matters for administrative law judges and other administrative adjudicators; (7)survey administrative hearing participants and use other methods to monitor the quality of administrative hearings held by the office and other state agencies,and submit to the governor and the legislature on January 31 of each year the results of the survey along with a report that includes a description ofthe activities of the office and recommendations for statutory changes that may be needed in relation to the administrative hearings held by the office or other state agencies; (8)review and comment on regulations proposed by state agencies to govern procedures in administrative hearings; (9)enter into contracts as necessary to carry out the functions of the office; (10)annually prepare and submit to the commissioner of administration a budget for the office for the next fiscal year that shall include and separately identify funding for training and continuing education;a copy of the budget submitted to the commissioner under this paragraph shall also be submitted to the Finance Committee of each house of the legislature; (11)after consulting with affected agencies,adopt regulations under AS 44.62 (Administrative Procedure Act)to carry out the duties of the office and implement this chapter; (12)receive and review applications from individuals seeking appointments to the Workers' Compensation Appeals Commission and submit the names of individuals to the governor for appointment as provided in AS 23.30.007(d);and (13)appoint a chair pro tempore for the Workers'Compensation Appeals Commission as provided in AS 23.30.007(m). (b)In carrying out the responsibilities of the office,the chief administrative law judge shall seek to accomplish the following goals: (1)provide for the delivery of high quality adjudication services in a timely,efficient,and cost- effective manner; (2)ensure respect for the privacy and dignity of the individuals whose cases are being adjudicated and protect them from threats,intimidation,and harassment; (3)foster open and clearly explained agency decisions and improve public access to the process of administrative adjudication; (4)guarantee protection of all parties'due process rights,increase the public parties'perception of fairness in administrative adjudication,and foster acceptance of final administrative decisions by the public and affected parties; Exhibit S-15 Page 2 of 10 (S)protect the integrity of the process of administrative adjudication and decisional independence of administrative adjudicators;and (6)increase consistency in administrative procedures and decisions. Sec.44.64.030.Jurisdiction of the office. (a)The office shall conduct all adjudicative administrative hearings required under the following statutes or under regulations adopted to implement the statutes: (1)AS 04.11.510(b)(1)and (c)(alcoholic beverages license); (2)AS 05.15 (charitable gaming); (3)AS 05.20 (recreational!devices); (4)AS 05.90.001 (special racing events); (5)AS 06 (banks,financial institutions,and fund claims),except as provided otherwise by AS 06.60.590; (6)AS 08 (occupational licensing),other than AS 08.08,AS 08.18.125,and AS 08.62.046; (7)AS 10.06 (Alaska Corporations Code); (8)AS 10.13 (Alaska BIDCO Act); (9)AS 10.25.375 (Electric and Telephone Cooperative Act); (10)AS 10.50.408 (limited liability companies); (11)AS 14.11.016 (education-related facility grants); (12)AS 14.18 (discrimination in public education); (13)AS 14.25.006 (teachers'retirement system); (14)AS 14.25.175 (waiver of adjustments under teachers'defined benefit plan); (15)AS 14.40.155 (suspension and removal of regents); (16)AS 14.48 (postsecondary educational institutions); (17)AS 17.20 (Alaska Food,Drug,and Cosmetic Act),other than AS 17.20.060 and 17.20.360; (18)AS 18.07 (certificate of need program); (19)AS 18.20 (hospitals and nursing facilities); Exhibit S-15 Page 3 of 10 (20)AS 21.09,AS 21.22.190,AS 21.27,except under AS 21.27.420(d),AS 21.34,AS 21.36,AS 21.69,AS 21.86.200,AS 21.87,and AS 21.96 {insurance}; (21)AS 25.27 (child support services); (22)AS 32.06 (Uniform Partnership Act); (23)AS 34.45 (unclaimed property); (24)AS 34.55.024 and 34.55.026 (Uniform Land Sales Practices Act); (25)AS 36.30 (State Procurement Code),other than AS 36.30.627(a)(2); (26)AS 38.05.065 (contracts for sale of state land); (27)AS 39.30.165 (supplemental benefits system); (28)AS 39.30.335 (teachers'and public employees'health reimbursement arrangement plan); (29)AS 39.35.006 (public employees'retirement system); (30)AS 39.35.522 (waiver of adjustments under public employees'defined benefit plan); (31)AS 39.45.055 (public employees'deferred compensation program); (32)AS 39.52 (Alaska Executive Branch Ethics Act); (33)AS 43.23 (permanent fund dividends); (34)AS 43.70 (Alaska Business License Act); (35)AS 44.50 (notaries public); (36)AS 44.77 (claims against the state); (37)AS 45.30.040 (mobile homes); (38)AS 45.48.080(c)(breach of security involving personal information); (39)AS 45.55 (Alaska Securities Act); (40)AS 45.57 (Takeover Bid Disclosure Act); (41)AS 46 (water,air,energy,and environmental conservation),other than AS 46.03.820, 46.03.850,AS 46.39,and AS 46.40; (42)AS 47.05 (assistance programs); (43)AS 47.07 (medical assistance for needy persons); Exhibit S-15 Page 4 of 10 (44)AS 47.25 (public assistance); (45)AS 47.27 (Alaska temporary assistance program); (46)AS 47.32 (licensing by the Department of Health and Social Services); (47)AS 47.37.130 (alcohol safety action program); (48)AS 47.37.140 (treatment facilities); (49)AS 47.45.050 (longevity bonuses); (50)AS 47.45.306 (Alaska senior benefits payment program). (b)An agency may request the office to conduct an administrative hearing or other proceeding of that agency or to conduct several administrative hearings or other proceedings under statutes not listed in (a)of this section.The office may provide the service after entering into a written agreement with the agency describing the services to be provided and providing for reimbursement by the agency to the office of the costs incurred by the office in providing the services. (c)To the extent otherwise permitted by law,the agency may delegate to the administrative law judge assigned to conduct the hearing on behalf of the agency the authority to make a final agency decision in the matter.The final decision may be appealed to the superior court by any party. (d)Nothing in this chapter may be construed to create a right to a hearing or to require a hearing that is not required under other law. Sec.44.64.040.Administrative law judges. (a)An administrative law judge must be admitted to practice law in this state and must have been admitted to practice in this state for at least two years before being employed or retained with the office.The chief administrative law judge shall establish additional qualifications for administrative law judges employed or retained by the office and for those administrative law judges that may be assigned to particular types of cases.An administrative law judge is in the partially exempt service. Notwithstanding AS 39.25.120(b),full-time administrative law judges employed by the office are subject to the personnel rules adopted under AS 39.25.150(7),(15),and (16). (b)An administrative law judge employed or retained by the office may,in conducting an administrative hearing for an agency,exercise the powers authorized by law for exercise by that agency in the performance of its duties in connection with the hearing.An administrative law judge may (1)engage in alternative dispute resolution under regulations adopted by the chief administrative law judge that is in addition to any alternate dispute resolution procedure used by an agency before the case is referred to the office; Exhibit S-15 Page 5 of 10 (2)order a party,a party's attorney,or another authorized representative of a party to pay reasonable expenses,including attorney fees,incurred by another party as a result of actions done in bad faith or as a result of tactics used frivolously or solely intended to cause unnecessary delay; (3)perform other necessary and appropriate acts in the performance of official duties. (c)An administrative law judge employed by the office must devote full time to the duties of the office unless appointed to a position that is less than full-time.An administrative law judge employed by the office may not perform duties inconsistent with the duties and responsibilities of an administrative law judge. (d)The office may enter into a contract with an individual who meets the qualifications established in (a)of this section to serve as an administrative law judge in a particular administrative hearing or in several hearings of the same type.The individual is subject to AS 39.52 (Alaska Executive Branch Ethics Act).Notwithstanding AS 36.30.015(d),the office may contract for or hire an administrative law judge without notifying or securing the approval of the Department of Law. Sec.44.64.050.Hearing officer conduct. (a)An administrative law judge employed full time by the office or a hearing officer employed full time by an agency may not serve in any other judicial or quasi-judicial capacity or engage in the private practice of law. (b)The chief administrative law judge shall,subject to AS 39.52.920 and by regulation,adopt a code of hearing officer conduct.The code shall apply to the chief administrative law judge, administrative law judges of the office,and hearing officers of each other agency.The following fundamental canons of conduct shall be included in the code:in carrying out official duties,an administrative law judge or hearing officer shall (1)uphold the integrity and independence of the office; {2}avoid impropriety and the appearance of impropriety; (3)perform the duties of the office impartially and diligently; (4)conduct unofficial activities in ways that minimize the risk of conflict with the obligations of the office;and (S)refrain from inappropriate activity in seeking employment with another agency or employer or in seeking reappointment. (c)Except as provided in (e)of this section,the chief administrative law judge shall receive and consider all complaints against administrative law judges or hearing officers employed or retained by the office or another agency alleging violations of (a)of this section or of the code of hearing officer conduct.The chief administrative law judge shall deliver the complaint to the attorney general when the Exhibit S-15 Page 6 of 10 chief administrative law judge determines that the conduct alleged,if true,would constitute a violation of (1)subsection (a)of this section;or (2)the code and would warrant disciplinary action under the regulations adopted under (b)of this section. (d)If the attorney general determines that a violation has occurred,the attorney general shall submit written findings to the agency that employed or retained the administrative law judge or hearing officer who is the subject of the complaint together with recommendations for corrective or disciplinary action.If the administrative law judge is employed or retained by the office,the chief administrative law judge shall take appropriate corrective or disciplinary action. (e)The attorney general shall,by regulation,establish procedures to implement (d)of this section,including procedures for investigating and holding hearings on complaints.The attorney general shall receive and consider any complaint filed against the chief administrative law judge under this section,and may investigate or hold a hearing on the complaint in compliance with the regulations adopted under this subsection. Sec.44.64.055.Reimbursement agreements. The office may enter into agreements for reimbursement for services related to an administrative hearing from a school district,municipality,or other governmental entity if the reimbursement is authorized by other law. Sec.44.64.060.Procedure for hearings. (a)The chief administrative law judge shall,by regulation,establish procedures for administrative hearings conducted by the office.Each administrative hearing under the jurisdiction of the office or that has been transferred to the office by an agency shall be conducted in accordance with statutes that apply to that hearing,including,if applicable,AS 44.62 (Administrative Procedure Act).In case of conflict between this section and another applicable statute establishing procedures for administrative hearings,the other statute prevails.However,to the extent regulations adopted by an agency for the conduct of an administrative hearing conflict with regulations adopted by the chief administrative law judge under this subsection,the regulations adopted by the chief administrative law judge control to the maximum extent possible without conflicting with applicable statutes. (b)When an agency receives a request for a hearing that is subject to AS 44.64.030,the agency shall,within 10 days and in writing,deny the request for reasons provided by law or grant the request and refer the case to the office.The agency shall immediately give notice of the denial or referral to the requesters and the office.If the request is denied,the denial may be appealed to the superior court as provided by other law.If the request is granted,the agency shall,within 15 days after receiving the request,compile and transmit to the office a copy of the request for a hearing,the names,addresses, and telephone numbers of all parties and their representatives,and the agency's decision,if any, Exhibit S-15 Page 7 of 10 together with the record relied on to support the decision.Any information provided to the office that is confidential by law shall be identified by the agency as confidential and shall be kept confidential by the office. (c}The agency may,with materials transmitted under (b)of this section,request the chief administrative law judge to permit the individual,board,or commission that will make the final decision to participate with the assigned administrative law judge in the conduct of the administrative hearing. The chief administrative law judge shall determine the degree and manner of participation and may terminate that participation at any time.However,the individual,board,or commission that participates under this subsection may not serve as the administrative law judge or preside during the hearing and may not take action on behalf of the agency in the agency's capacity as a party to the proceedings. (d)An administrative law judge employed or retained by the office shall,within 120 days after the date the agency received the request for a hearing,prepare a proposed decision,unless another time period is provided by law or agreed to by the parties and the chief administrative law judge.The administrative law judge shall immediately submit the proposed decision to the agency. (e)A proposed decision in an administrative hearing shall be in a form that may be adopted as the final decision by the agency with authority to make the final decision.The proposed decision is a public record,except as otherwise provided by statute.A copy of the proposed decision shall be served by the office on each party in the case or on the attorneys representing those parties in the hearing. Unless the office has established a shorter time period or another statute has established a different time period,within 30 days after the proposed decision is served,a party may file with the agency a proposal for action under (1)-(5)of this subsection.The agency with authority to make a final decision in the case retains agency discretion in the final disposition of the case and shall,within 45 days after the date the proposed decision is served or at the next regularly scheduled meeting that occurs at least 45 days after the proposed decision is served,do one or more of the following: (1)adopt the proposed decision as the final agency decision; (2)return the case to the administrative law judge to take additional evidence or make additional findings or for other specific proceedings,in which case the administrative law judge shall complete the additional work and return the revised proposed decision to the agency within 45 days after the original decision was returned under this paragraph; (3)exercise its discretion by revising the proposed enforcement action,determination of best interests,order,award,remedy,sanction,penalty,or other disposition of the case,and adopt the proposed decision as revised; (4)in writing,reject,modify,or amend a factual finding in the proposed decision by specifying the affected finding and identifying the testimony and other evidence relied on by the agency for the rejection,modification,or amendment of the finding,and issue a final agency decision; Exhibit S-15 Page 8 of 10 (5)in writing,reject,modify,or amend an interpretation or application in the proposed decision of a statute or regulation directly governing the agency's actions by specifying the reasons for the rejection,modification,or amendment,and issue a final agency decision. (f)If a final decision is not issued timely in accordance with (e)of this section,the administrative law judge's proposed decision is the final agency decision. Sec.44.64.070.Disqualification of administrative law judge. (a)The chief administrative law judge or an administrative law judge employed or retained by the office is disqualified from a case in which the administrative law judge cannot accord a fair and impartial hearing or for other reasons established in the code of hearing officer conduct. (b)A party may request the disqualification of the chief administrative law judge or another administrative law judge by filing an affidavit,before the taking of evidence at a hearing,stating with particularity the grounds upon which it is claimed that a fair and impartial hearing cannot be accorded by that administrative law judge.Notwithstanding AS 44.62.450(c),upon receipt ofthe affidavit,the administrative law judge assigned to the administrative hearing shall make a determination.If the affiant objects to the decision,the matter shall be decided by the chief administrative law judge,whose decision is final,or if the hearing is assigned to the chief administrative law judge,by the attorney general,whose decision is final. (c}In addition to disqualification of an administrative law judge under (a)and (b)of this section, each side is entitled to change the assigned administrative law judge once.Two or more parties aligned on the same side of an action shall be treated as one side for purposes of this subsection,but the chief administrative law judge may allow an additional change to a party whose interests are adverse to the interests of another party on the same side.A party wishing to exercise the right to change the administrative law judge shall give notice to the chief administrative law judge within five days after notice is given that the case has been assigned.A party waives the right to a change in the assigned administrative law judge by participating before that administrative law judge in any proceeding or conference involving the case. Sec.44.64.080.Agency cooperation. (a)All agencies shall cooperate with the chief administrative law judge and with other administrative law judges of the office in the matters involving the duties of the office. (b)Except as provided under AS 44.64.070 or by regulation adopted under this chapter,an agency may not select or reject a particular administrative law judge for assignment to an administrative hearing. (c)After an administrative hearing is referred by an agency to the office for hearing,the agency may not take further adjudicatory action in the case,except as a party litigant or to render a final decision as provided by law.This subsection does not otherwise limit the agency's authority to take action affecting a party to the case. Exhibit S-15 Page 9 of 10 Sec.44.64.090.Administrative hearing records. (a)The office shall acquire and organize statistical and other information relating to administrative hearings of the office and of other agencies.The office shall acquire and organize copies of proposed and final agency decisions in administrative hearings and copies of court decisions resulting from those administrative hearings.The information and decisions shall be made available to the public, agencies,and the legislature.The office shall make final agency decisions reached after administrative hearings available online through an electronic data base. (b)This section does not apply to records that are confidential or privileged. Sec.44.64.095.Federal requirements. Federal requirements applicable to an administrative hearing prevail to the extent they conflict with any provision of AS 44.64.010 -44.64.200. Sec.44.64.200.Definitions. in this chapter, (1)"administrative hearing"means a quasi-judicial hearing before an agency;it does not include an informal conference or review held by an agency before a final decision is issued or a rate-making proceeding or other nonadjudicative public hearing; (2)"administrative law judge"means a hearing officer who is retained or employed by the office; (3}"agency"means an agency of the executive branch of state government,including an officer, a division,or another subunit of an agency,a board or commission,a public corporation,and the University of Alaska; (4)"hearing officer"means an individual who presides over the conduct of an administrative hearing and who is retained or employed by an agency for that purpose; (5)"office"means the office of administrative hearings established in AS 44.64.010. Exhibit S-15 Page 10 of 10 Exhibit S-16 Chapter 40.21.MANAGEMENT AND PRESERVATION OF PUBLIC RECORDS Article 01.PUBLIC RECORDS Sec.40.21.010.Purpose. The purpose of this chapter is to provide for the orderly management of current state and local public records and to preserve noncurrent public records of permanent value for study and research. Sec.40.21.020.Archival and records management program creation and administration. There is established in the Department of Education and Early Development the Alaska State Archives. The department shall establish and administer a state archives and records management program.To implement the program and head the Alaska State Archives,the department shall create the position of state archivist,and shall appoint as state archivist a person qualified by special training or experience in archival or historical work.The state archivist shall be the official custodian of the archival resources of the state. Sec.40.21.030.Duties of the state archivist. (a)In order to carry out the archival program,the state archivist shall (1)negotiate for,acquire,and receive public records of permanent value including public records of the state and political subdivisions of the state and of defunct public agencies; (2)establish and operate a state archival depository that shall provide for the preservation, arrangement,repair,rehabilitation,duplication,reproduction,description,and exhibition of permanent public records or other documentary material transferred to,or acquired by the state archivist; (3)review and approve all agency records retention schedules to identify and to ensure the preservation of those records having permanent value; (4)make permanent records under the supervision ofthe archivist,other than those required by AS 40.25.120 to be kept confidential,available for public use at reasonable times; (5)for a fee established under AS 40.25.110 -40.25.115,make available to any person copies of archival material under AS 40.25.120; (6)adopt a seal for official use and for certification of record copies which copies shall have the same force and effect as if made by the original custodian of the records; (7)negotiate payment for the acquisition of public records with the possessor of them; Exhibit S-16 Page 1 of 6 (8)if negotiations under (7)of this subsection are unsuccessful or if the person in possession of the public records is unwilling to enter into those negotiations,arrange with the person in possession for the microfilming of the records; (9)accept gifts,bequests,and endowments for purposes consistent with the objectives of this chapter; (10)prepare inventories,indexes,catalogs,and other finding aids or guides to facilitate the use of the archives; (11)accept documents,including motion picture film,still pictures,and sound recordings,that are appropriate for preservation by the state as evidence of its organization,functions,policies, decisions,procedures,and transactions. (b)In order to carry out the records management program,the state archivist shall (1)analyze,develop,and coordinate the standards and procedures for record making and current record keeping; (2)ensure the maintenance and security of records; (3)initiate action to recover state records removed without authorization; (4)establish and operate state records centers for the purposes of accepting,servicing,storing, and protecting state records that must be preserved for varying periods of time but which are not needed for the transaction of current business; (5)transfer records considered to have permanent value to the state archives; (6)institute and maintain a training and information program in all phases of the management of current records for all state agencies; (7)make continuing surveys of paperwork operations and recommend improvements in current records management practices,including the use of space,equipment,and supplies; (8)initiate programs for improving the management of correspondence,forms,reports,and directives as integral parts of the overall records management program; (9)provide centralized microfilm service for state agencies as determined to be necessary by the department; (10)establish standards for the preparation of records retention schedules providing for the retention of state records of permanent value and for the prompt and orderly disposition of state records no longer possessing administrative,legal,or historical value to warrant their retention; (11)receive records retention schedules from the agencies and submit them to the attorney general for review and approval; Exhibit S-16 Page 2 of 6 (12)obtain from agencies reports that are required for the administration of the program. Sec.40.21.040.Gifts,bequests,or endowments of money. Gifts,bequests,or endowments of money shall be deposited in a separate account in the general fund and may be invested in a manner not inconsistent with the investment of other state funds.Proceeds of invested funds shall be used to carry out the purposes for which the money was given. Sec.40.21.050.Regulations. The department shall adopt regulations necessary to carry out the purposes of this chapter. Sec.40.21.060.Duties of chief executive officers of state agencies. The chief executive officer of each state agency shall (1)make and preserve public records containing adequate and proper documentation of the organization,functions,policies,decisions,procedures,and essential transactions of the agency,and designed to furnish the information necessary to protect the legal and financial rights of the state and of persons directly affected by the agency's activities; (2)establish and maintain an active,continuing program for the efficient management of the records of the agency under the procedures prescribed by the department,including effective controls over the creation,maintenance,and use of records in the conduct of current business; (3)submit to the department,in accordance with the standards established by it,records retention schedules proposing the length of time which records having administrative,legal,or historical value shall be retained; (4)apply the provisions of approved records retention schedules to ensure the orderly disposition of state records including transfer to a state records center; (5)identify,segregate,and protect records vital to the continuing operation of an agency in the event of natural,man-made,or war-caused disaster; (6)cooperate with the department in conducting surveys made by it under the provisions of this chapter; (7)establish safeguards against unauthorized or unlawful removal or loss of state records; (8)comply with the regulations,standards,and procedures relating to records management and archives established by the department; (9)appoint a records officer who shall act as a liaison between the department and the agency on all matters relating to the records management program. Exhibit S-16 Page 3 of 6 Sec.40.21.070.Records management for local records. The governing body of each political subdivision of the state shall promote the principles of efficient records management for local public records kept in accordance with state law.The governing body shall,as far as practical,follow the program established for the management of state records.The department shall,upon request of the governing body of a political subdivision,provide advice and assistance in the establishment of a local records management program. Sec.40.21.080.Disposal of public records by political subdivision. An official of a political subdivision of the state having legal custody of public records that are considered by the official to be without legal or administrative value or historical interest may compile lists of these records sufficiently detailed to identify them and submit the lists to the governing body of the political subdivision.The governing body may authorize the disposal and the method of disposal of the records in the list that it finds to be without legal or administrative value or historical interest.The governing body may also,upon request of the legal custodian of the records,authorize in advance the periodic disposal of routine records that the governing body considers to have no legal,administrative, or historical value.After receipt of written authorization from the governing body,the legal custodian of the records may dispose of the records.The legal custodian shall file in the office from which the records were drawn a descriptive list of the records disposed of and a record of the disposal itself.Copies of these documents shall be transmitted to the governing body,which shall file and preserve them. Sec.40.21.090.Transfer of public records of political subdivision to department. The governing body of a political subdivision of the state may authorize the transfer to the department of records that have legal,administrative,or historical value but that are not required for the transaction of current business.The official of the political subdivision having custody of the records shall prepare a list describing the records transferred in sufficient detail to identify them.Copies of the list shall be filed with the department and with the public corporation or political subdivision transferring the records.The department shall acknowledge receipt ofthe list.Listed records approved by the department for transfer may be transferred to a records center designated by the department. The records center shall transfer any permanent records to the archives.Records transferred remain the property of the political subdivision.The department is the legal custodian of records in its possession. Sec.40.21.100.Assistance to legislative and judicial branches. Upon request,the department shall assist in the establishment of records management programs in the legislative and judicial branches of the state government and shall provide program services similar to those available to the executive branch of state government. Sec.40.21.110.Care of records. Except for public records lawfully in the possession of a person other than the state,public records of existing or defunct agencies of the state,territorial,and Russian governments in Alaska are the property of the state and shall be created,maintained,preserved,stored,transferred,destroyed or disposed of, Exhibit S-16 Page 4 of 6 and otherwise managed in accordance with the provisions of this chapter and AS 45.48.500 -45.48.530. Records shall be delivered by outgoing officials and employees to their successors,and may not be removed,destroyed,or disposed of,except as provided in this chapter and AS 45.48.500 -45.48.530. Sec.40.21.120.Standards of clarity,accuracy,and permanency of copies. When a public officer performing duties under this chapter is required or authorized by law to record, copy,recopy,or replace any public record,the officer may do so by photostatic,photographic, microphotographic,microfilm,or other mechanical or optical disk imaging system process that produces a clear and accurate copy or reproduction of the original record.If a record is considered to be of permanent or archival value,a reproduction of the record must meet archival standards approved by the department. Sec.40.21.130.Alteration and replacement of public records. An original public record that is worn or damaged may be replaced by a reproduction made in accordance with this chapter.Certification by the agency having custody of the record that the replacement is a true and correct copy of the original shall appear at the end of the reproduction.When original public records are photographed or otherwise mechanically reproduced under the provisions of this chapter and the photographic or other mechanical reproductions are placed in conveniently accessible files and provisions made for preserving and using them,the original records from which they were made may be destroyed only with the approval of the state archivist. Sec.40.21.140.Use of copies and replacements as evidence. Reproductions or replacements of records made under this chapter are considered original records for all purposes and are admissible in evidence as original records. Article 02.GENERAL PROVISIONS Sec.40.21.150.Definitions. In this chapter,unless the context otherwise requires, (1)"agency"or "state agency"means a department,office,agency,state board,commission, public corporation,or other organizational unit of or created under the executive branch of the state government;the term does not include the University of Alaska; (2)"archives"means (A)the noncurrent records of a state agency or political subdivision of the state preserved,after appraisal,because of their value;also referred to as archival material or archival holdings; (B)the agency responsible for selecting,preserving,and making available archival material;also referred to as an archival agency;or Exhibit S-16 Page 5 of 6 (C)the building or part of a building where archival material is located;also referred to as an archival depository; (3)"department"means the Department of Education and Early Development; (4)"electronic record"means any information that is recorded in machine readable form; (5)"local record"means a public record of a city or borough of any class,villages,district, authority,or other political subdivision unless the record is designated or treated as a state record under state law; (6)"record"means any document,paper,book,letter,drawing,map,plat,photo,photographic file,motion picture film,microfilm,microphotograph,exhibit,magnetic or paper tape,punched card, electronic record,or other document of any other material,regardless of physical form or characteristic, developed or received under law or in connection with the transaction of official business and preserved or appropriate for preservation by an agency or a political subdivision,as evidence of the organization, function,policies,decisions,procedures,operations,or other activities of the state or political subdivision or because of the informational value in them;the term does not include library and museum material developed or acquired and preserved solely for reference,historical,or exhibition purposes,extra copies of documents preserved solely for convenience of reference,or stocks of publications and processed documents; (7)"records center"means a records depository in the department for the storage and disposition of noncurrent records; (8)"state record"means a record of a department,office,commission,board,public corporation,or other agency of the state government,including a record of the legislature or a court and any other record designated ortreated as a public record under state law. Exhibit S-16 Page 6 of 6 Exhibit S-17 Sec.37.25.050.Methods of disbursement. (a)Except as provided in (b)of this section,unless federal law requires otherwise,a state agency may not disburse money unless the disbursement is made (1)by an electronic funds transfer to an account in a financial institution;or (2)from an account established by the state agency by contract with a financial institution under which a person uses an electronic payment card issued by the financial institution to access the money. (b)A state agency is not required to use the disbursement methods described in (a)of the section if (1)another state law or federal law requires that disbursement be made by another disbursement method; (2)use of the disbursement methods would cause substantial hardship to the recipient of the disbursement; (3)not more than five disbursements will be made to a recipient,or,on average,to each recipient entitled to disbursement under the program for which the disbursements are made; (4)a vendor or grantee elects not to be paid by the disbursement methods; (5)the disbursement is to a state employee and (A)is the only disbursement that the state agency will make to the employee for the employment;or (B)it is in the best interests of the state agency or the employee to use another disbursement method to pay the employee;or (6)use of another disbursement method is in the best interests of the state agency. (c)The commissioner of administration shall adopt regulations to implement (b)of this section. (d)A state agency is not liable to pay a fee imposed by a recipient's financial institution for a disbursement made under (a)of this section. (e)In this section, (1)"disbursement”includes wages and other employment benefits; (2)"state agency"means a department,institution,board,commission,division,authority, public corporation,committee,or other administrative unit of the executive branch of state government,including the University of Alaska. $-17 Page 1 of 1 Exhibit S-18 Sec.44.99.030.Lobbying contracts prohibited. (a)Notwithstanding other provisions of law,the following entities may not contract with a person to pay the person money or other thing of value to lobby the state,a municipality of the state, or an agency of the state or municipality: (1)Alaska Aerospace Corporation; (2)Alaska Commercial Fishing and Agriculture Bank; (3)Alaska Energy Authority; (4)Alaska Housing Finance Corporation; (5)Alaska Industrial Development and Export Authority; (6)Alaska Medical Facility Authority; (7)Alaska Mental Health Trust Authority; (8)Alaska Municipal Bond Bank Authority; (9)Alaska Permanent Fund Corporation; (10)Alaska Railroad Corporation; (11)[Repealed,Sec.8 ch 2 SLA 2004]. (12)Alaska Seafood Marketing Institute; (13)Alaska Student Loan Corporation. (b)In this section, (1)"lobby a municipality or an agency of a municipality"means to engage in an activity for the purpose of influencing municipal legislative or administrative action if the activity is substantially the same as activity that would have required registration under AS 24.45.1211 if the activity was for the purpose of influencing state legislative or administrative action; (2)"lobby the state or an agency of the state"means to engage in an activity for which registration is required under AS 24.45.121. Exhibit S-18 Page 1 of 2 Sec.44.99.040.Limitation on use of assets. (a)A state or municipal agency may not use or authorize the use of an asset to implement or aid in the implementation of a requirement of (1)an order ofthe President of the United States,a federal regulation,or a law enacted by the United States Congress that is applied to (A)infringe on a person's right,under the Second Amendment to the Constitution of the United States,to keep and bear arms; (B)deny a person a right to due process,or a protection of due process,that would otherwise be available to the person under the Constitution of the State of Alaska or the Constitution of the United States;or (2)P.L.109-13,Division B (REAL ID Act of 2005). (b)In this section, (1)"asset"means funds,facilities,equipment,services,or other resources of a state or municipal agency; (2)"state or municipal agency"means the University of Alaska,the Alaska Aerospace Corporation,the Alaska Housing Finance Corporation,the Alaska Industrial Development and Export Authority,the Alaska Energy Authority,the Alaska Railroad Corporation,or a department,institution, board,commission,division,council,committee,authority,public corporation,school district,regional educational attendance area,or other administrative unit of a municipality or of the executive,judicial, or legislative branch of state government,and includes employees ofthose entities. Exhibit $-18 Page 2 of 2 Exhibit S-19 Sec.24.08.035.Fiscal notes on bills. (a)Before a bill or resolution,except an appropriation bill,is reported from the committee of first referral,there shall be attached to the bill a fiscal note containing an estimate of the amount of the appropriation increase or decrease that would result from enactment of the bill for the current fiscal year and five succeeding fiscal years or,if the bill has no fiscal impact,a statement to that effect shall be attached.The fiscal note or statement shall be prepared in conformity with the requirements of this section by the department or departments affected and may be reviewed by the office of management and budget.The fiscal note or statement shall be delivered to the committee requesting it within three days of the request.If the bill is presented by the governor for introduction in accordance with AS 24.08.060(b)and the uniform rules of the legislature,the fiscal note or statement shall be attached to the bill before the bill is introduced.An amendment or a substitute bill proposed by a committee of referral that changes the fiscal impact of a bill shall be explained in a revised fiscal note or statement attached to the bill. (b)In addition to the fiscal note required by this section,the sponsor of a bill or resolution may prepare a fiscal note in conformity with the requirements of this section and submit it to the committee of first referral or the finance committee.A committee may prepare an additional fiscal note in conformity with the requirements of this section. (c)A fiscal note for a bill or resolution must contain the following information: (1)the fiscal impact on existing programs; (2)the fiscal impact of new programs or activities; (3)a line item detail of the fiscal impact; (4)the source of funds expected to be utilized by genera!fund source,federal fund source,or other identified source; (5)the number of new positions that may be required,identified as full-time,part-time,or temporary; (6)an analysis of how the figures in the fiscal note were derived; (7)additional information necessary to explain the fiscal note; (8)a fiscal impact projection for the current fiscal year and for the succeeding five fiscal years; and (9}formal information consisting of (A)the bill or resolution number, Exhibit $-19 Page 1 of 2 (B)the name of the prime sponsors, (C)the date the fiscal note was prepared, (D)the name of the committee requesting the fiscal note, (E)the name and phone number of the person who prepared the fiscal note,and (F)the budget request unit,program,or subprogram affected. (d)The original of a fiscal note shall be submitted to the Division of Legislative Finance and copies shall be sent to the prime sponsor,the committee requesting the fiscal note,and the office of management and budget. (e)[Repealed,Sec.2 ch 64 SLA 1992]. (f)In addition to the other requirements of this section,if a bill directs an agency in the executive branch of state government to adopt,amend,or repeal a regulation or will result in an agency's adopting,amending,or repealing a regulation,the department affected shall include in the fiscal note for the bill a specific time by which the agency shall adopt,amend,or repeal the regulation. If the agency is not able to meet the deadline set in the fiscal note,the agency shall (1)set a new deadline;and (2)report to the Administrative Regulation Review Committee the new deadline and the reasons for being unable to meet the deadline set in the fiscal note. (g)In (f)of this section,"agency"includes the Alaska Housing Finance Corporation,the Alaska Industrial Development and Export Authority,the Alaska Energy Authority,the Alaska Public Offices Commission,and the Alaska Oil and Gas Conservation Commission,but does not include other boards or commissions. Exhibit S-19 Page 2 of 2 Exhibit S-20 Article 03.STATE AGENCY OFFICE HOURS Sec.44.12.200.State agency office hours. (a)It is the policy of the state that,to the extent practicable,state agency offices that are intended to provide services directly to the public shall schedule the hours of work of their employees so that the offices are open at the times most convenient to the individuals being served and staffed by employees working 40 hours per week.Each office shall review the preferences and needs of its clientele and shall recommend to the commissioner or other executive head of the state agency the most suitable hours of operation for that specific location.Each office shall periodically review its hours of operation. (b)In this section,"state agency"means a department,institution,board,commission,division, authority,public corporation,committee,or other administrative unit of the executive branch of state government,including the University of Alaska,the Alaska Railroad Corporation,and the Alaska Aerospace Corporation. Exhibit S-20 Page 1of 1 Exhibit S-21 AS 44.88.080.Powers of the Alaska Industrial Development and Export Authority. In furtherance of its corporate purposes,[AIDEA]has the following powers in addition to its other powers: (30)with legislative approval and notwithstanding AS 44.88.060,to purchase from the Alaska Energy Authority as an investment of the revolving fund,loans of the power project fund established under AS 4.45.010; Exhibit S-21 Page 1 of 1