Legislature(2001 - 2002)
2001-02-28 Senate Journal
Full Journal pdf2001-02-28 Senate Journal Page 0537 SB 122 SENATE BILL NO. 122 BY THE SENATE RULES COMMITTEE BY REQUEST OF THE GOVERNOR, entitled: "An Act authorizing financing for certain public transportation projects; giving notice of and approving the entry into, and the issuance of revenue obligations that provide participation in, lease- financing agreements for those transportation projects; and providing for an effective date." was read the first time and referred to the Transportation, Judiciary and Finance Committees. The following fiscal information was published today: Fiscal Note No. 1, Department of Revenue Governor's transmittal letter dated February 27: Dear President Halford: Today I am transmitting a bill that authorizes the issuance of revenue obligations to finance the accelerated construction of $425 million in transportation projects throughout the state. The projects outlined in this bill represent one of the three parts of a comprehensive transportation plan. In addition to the $425 million in projects within this legislation, the regular statewide transportation improvement program (STIP) targets $1.2 billion for projects over the next three years. We are also working with our congressional delegation to secure additional federal transportation funding for large projects throughout our state. Alaska's allocation of federal highway funds has increased in recent years. Despite an aggressive six-year transportation plan that addresses continued improvements to state highways, marine transportation, and local roads and trails, many important transportation needs remain unmet. We must do all we can, as soon as we can, to keep up with 2001-02-28 Senate Journal Page 0538 those critical needs. Now, thanks to Grant Anticipation Revenue Vehicles (GARVEEs), an innovative federal program that many states are using, we have an opportunity to build our statewide transportation infrastructure sooner than would be possible under the conventional program alone. The projects to be financed with GARVEEs all qualify for federal highway aid. Because of this qualification, future federal highway aid can be used to pay the principal and interest on the obligations. It is also possible to use interest earnings to satisfy federal requirements for state general fund match money. This method of financing allows construction of these vital projects now rather than waiting years for future federal highway aid. Using this financing approach can also save money by avoiding inflationary costs that would accrue to each project if left for future construction. The projects included in the bill serve the entire state, from Southeast Alaska to the North Slope. They address pressing transportation needs that may not be funded under our regular federal program for 10 years or longer. Revenue obligation payments would be annually appropriated by the Legislature from federal money received as an apportionment of federal highway grants. Timing is crucial to take full advantage of this accelerated financing opportunity and the economic benefits of these construction projects. Because of the need for efficiency and speed, I am proposing to finance these projects through revenue obligations, unlike the general obligation approach I offered last year when I introduced a similar plan to the Legislature. I urge your prompt and favorable action on this innovative approach to accelerate the construction of important transportation projects. Sincerely, /s/ Tony Knowles Governor