The 3rd meeting of the Subcommittee on Natural Resources of the Interim Joint Committee on Agriculture and Natural Resources was held on Wednesday, November 10, 2004, at 10:00 AM, in Room 149 of the Capitol Annex. Senator Ernie Harris, Chair, called the meeting to order, and the secretary called the roll.
Present were:
Members: Senator Ernie Harris, Co-Chair; Representatives Hubert Collins, Tim Couch, Brandon Smith, and Brent Yonts.
Guests: Secretary LaJuana Wilcher, Karen Wilson, and Donna Marlin, Environmental and Public Protection Cabinet; Secretary Jim Host and Andrew McNeil, Commerce Cabinet.
LRC Staff: Tanya Monsanto, Lowell Atchley, and Kelly Blevins.
Senator Harris noted that the subcommittee did not have a quorum. Secretary Host then introduced himself and Secretary Wilcher and Mr. Andrew McNeil. Secretary Host described the activity of the newly created Commonwealth Energy Policy Task Force. He explained that Kentucky has an abundance of natural resources, low electricity rates, and high demand for electricity. Secretary Host also explained that there are only eight states without an energy policy and Kentucky is among them. As a result, Kentucky experienced an opportunity loss of about $348 million dollars in federal funds.
Secretary Wilcher then described the abundance of natural resources and reiterated that developing an energy policy will enhance Kentucky's ability to obtain federal grants. It enables the state to grow jobs and economic opportunities. The goal is to utilize Kentucky's energy resources in a sustainable fashion. Governor Fletcher announced the task force's main goals: maintain the environment, develop energy resources, and keep energy rates low.
Secretary Host then provided an overview of the Commonwealth Energy Task Force's membership and public meetings agenda. He also mentioned some of the task force's main concerns such as Kentucky's need to upgrade infrastructure, trends in higher fuel prices, and pressures from the Federal Energy Regulatory Commission's (FERC) standard market design. Secretary Host concluded by reiterating that energy is a very important resources for Kentucky. He said that the task force intends to have a policy completed with suggested legislation by the middle of December.
Secretary Wilcher then discussed electric energy's importance to Kentucky. Sec. Wilcher described the environmental impacts from energy production and use. The energy plan will look at how resource use can preserve the environment through better energy management, the development of alternative energy. The state will take a holistic approach. The plan will be developed with many sectors in mind.
Sen. Harris thanked the presenters and commented on the involvement of the chairs of the Special Subcommittee on Energy in the development of the energy plan.
Rep. Yonts asked what the state has done in the last decade on renewables and hydro power. Secretary Wilcher commented that some utilities offer green energy plans. The Tennessee Valley Authority has also done work with hydro. There have been advances in solar power and alternative fuels like biodiesel and ethanol.
Rep. Yonts asked if waste wood is considered an energy source and asked if the group was aware of the electric generation plan in Vermont that uses waste wood. He also asked if Thoroughbred plant is figured into the state's energy equation. Secretary Wilcher responded that Thoroughbred is something that the cabinet would like to process quickly. The Secretary remarked that under her authority the process can be expedited through her review of the Thoroughbred application.
Sen. Harris thanked the task force's efforts again. He remarked that the federal agencies continue to impact Kentucky. For example U.S. Environmental Protection Agency's mercury rule, changes in the particulate matter standards, new rules from FERC and the fight over clean coal technology make it difficult for Kentucky to maintain low rates. Also emergent technologies like ethanol and biodiesel are important. I hope the task force's efforts can impact federal energy policy. Also is there anything on the horizon that will impact the agriculture or natural resource community?
Secretary Host commented that the state wants to purchase directly from farmers on a competitive basis. Local product quality is very good, but the state cannot purchase everything directly from farmers. Secretary Host said the procurement law can be amended so the state can buy locally in a competitive manner. The intent is to provide a new definition of agricultural products to permit the state greater ability to make purchases. Right now the Parks Department is able to buy local product and it has worked well.
Sen. Harris thanked the speakers and then called the next speaker to the table to provide testimony. Donna Marlin with the Drinking Water Branch in the Environmental and Public Protection Cabinet introduced herself. Ms. Marlin described the jurisdiction of the Drinking Water Branch. She also described the federal and state laws governing water systems.
Ms. Marlin discussed the various rules that Kentucky must adopt in order to retain primacy over the drinking water program. Unlike other programs for which the state obtains primacy, the drinking water program requires that for each federal rule, the state must promulgate rules that implement the federal standards. In that manner, the state retains primacy on a rule by rule basis.
Ms. Marlin then described the functions and responsibilities of the drinking water branch. She noted that the branch has updated its database and is improving performance on handling violations. Some 4,000 violations outstanding has been reduced now to 350. Kentucky is better able to monitor Kentucky's safe drinking water act. Ms. Marlin then described other programs under jurisdiction such as the revolving loan program. Finally, Ms. Marlin described the laboratory certification process which is a significant part of the testing process for drinking water. She noted there are only 6 certified labs in Kentucky for testing chemical and bacteriological content. All systems must report their data to the drinking water branch and we then give the system a list of laboratories that have been certified. All reports from labs are due at the end of the month.
Rep. Collins noted that a new water plant is being built in his district which will extract water from Paintsville Lake. He thanked Ms. Marlin for her assistance with that project.
Rep. Yonts asked if the semi-public systems are also under the regulation of the Public Service Commission (PSC) or the drinking water branch. Ms. Marlin remarked that semi-public systems are under the jurisdiction of the drinking water branch. Semi-public systems which are commercial businesses are not subject to the PSC. The drinking water branch oversees the source and the system is subject to inspection but we do not review their water charges to the public.
Rep. Yonts remarked that Eastern Kentucky had problems with their water systems with less than 5,000 customers. Many of those systems were consolidated. Ms. Marlin remarked that there has been great effort to consolidate systems. There are as many as two systems a month that are inactivated. The problem is that federal dollars for improvements is based on the number of systems rather than the number of subscribers. When we consolidate, Kentucky loses federal funds.
Rep. Yonts asked if there is data on the number of wells versus the number of lines serving households. Ms. Marlin indicated there was no specific data like that.
Sen. Harris remarked that there were maps on line extensions and service even if there is no comparative data at present. Ms. Marlin agreed. Sen. Harris also asked if the new data base is for permitting and filing or just for data reporting. He also asked when the new system would be operational. Ms. Marlin stated that it is for data reporting and that it will be operational in approximately 6 months. The problem is that some labs don't have computers for data submittals and the branch is working with those labs so that the systems are compatible.
Sen. Harris asked if extensions of water and sewer lines occur simultaneously. Does the Division of Water work with this issue? Also there was Phase I dollars for water line extensions. Do you work with Kentucky Infrastructure Authority (KIA) to make water line extensions? Ms. Marlin replied that yes the Division of Water does work with the water line extension issue. If there are problems with extensions, the Division will provide technical assistance.
Sen. Harris asked if there is a type of 6-year road plan for extension of water lines. Ms. Marlin replied that she was unaware of this concept. Rep. Collins remarked that this concept was already being used at KIA because the prioritization, number of families, number of extensions, etc., are similar to development of a road plan.
Sen. Harris said that a few years ago there were questions about the Environmental and Public Protection Cabinet allowing independent groups to conduct water quality tests from creeks. Has there been a change in that policy at the cabinet? Does the cabinet continue to permit independent groups to perform those tests? Ms. Marlin replied described the testing procedures for drinking water. She stated that those tests may be contracted for but the samples must be run by a certified lab.
Sen. Harris clarified that his concern was testing from streams or surface waters. What type of controls are there for the testing of water quality from surface water such as streams and creeks? Ms. Marlin stated that she is not qualified to discuss surface water testing but that there is testing and monitoring of watersheds. Then Ms. Karen Wilson with EPPC remarked that there was discussion regarding independent testing of surface waters in the past and that EPPC staff will report back with an update.
Sen. Harris stated that he has reservations about allowing private groups to test surface waters because some might not be independent. There need to be safeguards to preserve the reliability of those test results.
Sen. Harris thanked the presenters. There being no further business the meeting adjourned at approximately 11:45 a.m.