05/02/1994 08:30 AM House FIN

  HB 466    An Act authorizing  the issuance  of bonds by  the                 
            Alaska  Housing Finance Corporation to pay for the                 
            costs  of  repair  and  rehabilitation of  student                 
            housing facilities  of the  University of  Alaska;                 
            authorizing   the  issuance   of   bonds  by   the                 
            University  of  Alaska  to pay  for  the  costs of                 
                                                                               
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            repair  and  rehabilitation of  facilities  of the                 
            University  of  Alaska;  amending  powers  of  the                 
            Alaska Housing Finance  Corporation; amending  the                 
            definition of "public  building"; relating to  the                 
            Alaska debt retirement fund;  and providing for an                 
            effective date.                                                    
                                                                               
            HB  466   was  HELD   in  Committee  for   further                 
            consideration.                                                     
  HOUSE BILL 466                                                               
                                                                               
       "An Act authorizing the issuance of bonds by the Alaska                 
       Housing Finance  Corporation to  pay for  the costs  of                 
       repair and rehabilitation of student housing facilities                 
       of the  University of Alaska;  authorizing the issuance                 
       of bonds by  the University  of Alaska to  pay for  the                 
       costs of repair and rehabilitation of facilities of the                 
       University  of  Alaska; amending  powers of  the Alaska                 
       Housing Finance Corporation; amending the definition of                 
       "public  building";   relating  to   the  Alaska   debt                 
       retirement fund; and providing for an effective date."                  
                                                                               
  WENDY  REDMAN,  VICE  PRESIDENT  FOR  UNIVERSITY  RELATIONS,                 
  UNIVERSITY OF ALASKA, ANCHORAGE, explained that HB 466 would                 
  include authorization for  $30 million  dollars in bonds  to                 
  construct  student  housing at  the  Anchorage campus.   She                 
  added that student housing has been an UAA's capital request                 
  for a number of years.  UAA's  384 beds can accommodate only                 
  2.6% of the student needs.   The current demand was measured                 
  by a student survey which indicated a need for an additional                 
  2000  beds.    The  proposed  funding  would enable  UAA  to                 
  construct  600 dormitory  beds as well  as common  areas for                 
  food service, study, lounge and laundry facilities.                          
                                                                               
  Ms. Redman  continued, that the legislation  would authorize                 
                                                                               
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  the Alaska Housing Finance Corporation  to issue $30 million                 
  dollars   in   bonds   for   student   housing  repair   and                 
  rehabilitation of other university  facilities.  The program                 
  would allow buildings to be constructed with the cost spread                 
  over the remaining life of the facilities.                                   
                                                                               
  Ms.  Redman  provided  Committee  members  with  a  list  of                 
  priority projects.  [Copy  on file].  Repayment of  the debt                 
  service will be made from annual  legislative appropriations                 
  from the Alaska debt retirement fund (AS 37.05.011).                         
                                                                               
  Co-Chair MacLean inquired  who would be responsible  for the                 
  cost of the payment.  Ms. Redman replied that the bill would                 
  direct that  the Alaska  debt retirement  fund  pay for  the                 
  bond.   Those payments would appear in the FY96 budget.  She                 
  added that the total deferred  maintenance need in Anchorage                 
  amounted to $22 million dollars.                                             
                                                                               
  Representative Brown questioned  the zero fiscal note.   Ms.                 
  Redman noted there would be no  payment in FY95.  Discussion                 
  followed  regarding  the fiscal  impact of  the legislation.                 
  Ms.  Redman explained  that no revenue  is generated  on the                 
  facilities except for  student housing  and that revenue  is                 
  placed into the costs of operations and maintenance of those                 
  facilities.                                                                  
                                                                               
  Representative Brown asked the cost to the State without the                 
  legislation.   Ms. Redman  replied that  it would total  the                 
  cost  of protecting  the infrastructure.    Co-Chair MacLean                 
  argued  that  additional  costs would  exist  for  any state                 
  facilities.    Ms. Redman  reminded  the Committee  that she                 
  spoke for the student body and that deferred maintenance was                 
  their number one priority.   Co-Chair MacLean criticized the                 
  University's level of financial support  in the FY95 budget.                 
  She did not feel they should be requesting additional funds.                 
                                                                               
                                                                               
  WILL  GAY, (TESTIFIED  VIA  TELECONFERENCE), ALASKA  HOUSING                 
  FINANCE  CORPORATION, ANCHORAGE,  noted that  Alaska Housing                 
  Finance  Corporation  (AHFC)   would  support  the   bonding                 
  requested by the  legislation.  HB  466 would allow AHFC  to                 
  exchange assets for  a chance to  have income to offset  the                 
  transfer.                                                                    
                                                                               
  Representative  Brown asked  how  the  bonding debt  service                 
  would  be  paid.   Mr.  Gay  responded the  bill  provided a                 
  section defining  the special  obligations originating  from                 
  revenue  and  receipts  derived  under  agreement  with  the                 
  University  of  Alaska  as  described  and provided  by  the                 
  University's budget and student housing payments.                            
                                                                               
  Representative   Therriault    reiterated   that    deferred                 
                                                                               
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  maintenance was the  number one priority of  the University,                 
  stressing that it is  a problem which will continue  to grow                 
  if not addressed.  The Board  of Regents has guaranteed that                 
  once the  problem is  remedied, they  will not  allow it  to                 
  occur again.                                                                 
                                                                               
  (Tape Change, HFC 94-150, Side 2).                                           
                                                                               
  Co-Chair  MacLean  provided  the  Committee  with a  handout                 
  itemizing the Department of Education's deferred maintenance                 
  project list requested statewide from  K - University level.                 
  She suggested that  these projects  should be considered  in                 
  addition  to  the University's  projects.   [Copy  on file].                 
  Representative  Therriault  strongly  opposed  the  list  as                 
  provided by Co-Chair MacLean.   Co-Chair MacLean stated that                 
  this legislation would be a policy call.                                     
                                                                               
  REPRESENTATIVE JOHN DAVIES deliberated on concerns impacting                 
  the University's deferred maintenance which have resulted in                 
  action by the University to request bonding.  He recommended                 
  that adding Co-Chair MacLean's list  would negatively impact                 
  the legislation's  passage.   Discussion followed  regarding                 
  incorporation of the maintenance projects for K-12 to HB 466                 
  and how that would impact the bills passage.                                 
                                                                               
  HB 466 was HELD in Committee for further consideration.