Legislature(2005 - 2006)CAPITOL 106
01/12/2006 08:00 AM House STATE AFFAIRS
| Audio | Topic |
|---|---|
| Start | |
| HB23 | |
| HB278 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 23 | TELECONFERENCED | |
| *+ | HB 278 | TELECONFERENCED | |
| += | HB 273 | TELECONFERENCED | |
HB 23-CONSTRUCTION OF LEGISLATIVE HALL 8:07:59 AM CHAIR SEATON announced that the first order of business was HOUSE BILL NO. 23, "An Act relating to construction of a legislative hall." 8:08:04 AM REPRESENTATIVE MARK NEUMAN, Alaska State Legislature, stated that through discussions with John Duffy, Manager, Matanuska- Susitna (Mat-Su) Borough, approximately 1,000 acres have been identified within that borough as available to give any developer rights to construct a legislative hall. He said he envisions hotels and shopping areas that would emerge there in what he described as the fastest growing areas in the state. He indicated that about 60 percent of the state lives nearby and approximately 75 percent of the state would have access by road to the area. REPRESENTATIVE NEUMAN clarified that he is not proposing a move of the capital; the legislative hall would just serve as a place for the legislature to meet during its session. He said he thinks this is a good option that would not cost the state a lot of money. He noted that there is a fast ferry slated to operate next year. He said part of the bill requires that there be access to an airport. He indicated that legislators from the major population areas could go home at night, thus saving the state money in the cost of transportation. Those legislators in Southeast, Alaska, he noted would have to do the traveling that the rest of the legislators are already doing. 8:11:07 AM REPRESENTATIVE LYNN moved to adopt the committee substitute (CS) for HB 23, Version 24-LS0164\F, Cook, 1/9/06, as a work draft. There being no objection, Version F was before the committee. 8:11:48 AM CHAIR SEATON asked if Representative Neuman is suggesting that the developer would work within the specifications created by Legislative Council. 8:11:57 AM REPRESENTATIVE NEUMAN answered that's correct. He said, "I think that it would assist [Legislative] Council tremendously to have a developer there to help them work through this process." He said he thinks it may save the state money and time. 8:12:22 AM REPRESENTATIVE LYNN noted that there is a small light plane landing field there, but he said he doesn't know how close that is to "the anticipated terminus of the proposed Knik Arm Bridge on the north side which could be used." 8:12:50 AM REPRESENTATIVE NEUMAN said he believes it's a private airstrip, but he noted that there are plans for the development of a commercial airstrip. He noted that there is natural gas and electricity in the area. 8:13:24 AM REPRESENTATIVE LYNN said the original bill limits participation to boroughs with 30,000 residents and he suggested that would need to be changed so that the area Representative Neuman is describing could participate. 8:13:49 AM REPRESENTATIVE NEUMAN clarified that it would be the municipality of Mat-Su Borough that would be involved. 8:14:08 AM REPRESENTATIVE LYNN said he wondered if legislative/staff housing would be provided close to the hall. He clarified that he is describing some sort of annex that would be owned by the state. 8:14:27 AM REPRESENTATIVE NEUMAN indicated that some type of housing units may be built; however, he noted that Anchorage is not far away. 8:15:51 AM CHAIR SEATON clarified that the committee is not hearing a specific plan right now; Representative Neuman is just coming forward to show that there is an area interested in bidding on a legislative hall. 8:17:05 AM REPRESENTATIVE LYNN said his idea for housing would work anywhere in the state. 8:17:18 AM REPRESENTATIVE NEUMAN said the Mat-Su Borough would donate the land to a developer that would like to build a legislative hall, which he said would cost the state virtually nothing for the construction of the building. 8:17:51 AM REPRESENTATIVE ELKINS said he is pleased to hear that the economic engine is working in Mat-Su, but he thinks it's inappropriate for the legislature to consider taking economic sanctions against another community. 8:19:01 AM CHAIR SEATON asked Representative Elkins to hold that thought for the sponsor of the bill. 8:19:23 AM REPRESENTATIVE GRUENBERG noted that the [Fiscally Responsible Alaskans Needing Knowledge (FRANK)] Initiative is repealed on page 5, Section 6 of Version F. He asked Representative Neuman if he supports the repeal of the FRANK Initiative. 8:20:20 AM REPRESENTATIVE NEUMAN said he would like to withhold his response until he is further versed regarding Version F, but he said he would get back to Representative Gruenberg on that. In response to Representative Elkins' previous remarks, he asked that legislator to keep in mind that he believes that "it is a major calling by the majority of the state of Alaska to have access to their legislators while they're in the legislative session." He said [if a legislative hall was closer to the majority of the population], school children could visit the legislature and learn its process. He said he recognizes Representative Elkins' concern. 8:22:14 AM REPRESENTATIVE NORMAN ROKEBERG, Alaska State Legislature, as sponsor of HB 23, referred to the sectional analysis included in the committee packet and reviewed the requirements of select sections of Version F. He said Section 2 would require Legislative Council to develop specifications by December 15, 2006, changing the term "uniform building code" to "international building code," as well as some other administrative changes. Section 3, he said, sets the [date by which the hall must be completed] to June 30, 2009. Section 4 states that Legislative Council must [select or reject] proposals by June 30, 2007. Section 5, he confirmed, would repeal the provision of the FRANK Initiative, included in AS 44.06.050, 055, and 060. REPRESENTATIVE ROKEBERG said the FRANK Initiative requires that the public be informed in advance of all costs involved in relocating the capital or the legislature. He explained that the repeal provision was added "in order to, in a more timely manner, proceed with the activities of the legislature and Legislative Council on this." He said it is going to be extremely difficult to meet the requirements [of the FRANK Initiative]. He said the way [HB 23] is designed, the legislature would only pay $1 a year rent [for a legislative hall]; however, there would be other costs for relocation, for example. He said there would be other "modest costs," which he estimated would be "somewhat less than $10 million maximum." In other words, he explained, the FRANK Initiative is not necessary under the terms of the bill. REPRESENTATIVE ROKEBERG said the FRANK Initiative was designed by "the citizens of this fair city to protect their position as holding onto the capital." He said the attorney general (AG) found that the requirements of the initiative were that all bondable costs be part of the costs of either relocating the capital or the legislature. He said in 1982, voters rejected a ballot proposition to relocate the capital to Willow, Alaska, after the FRANK Initiative had been adopted. The estimate for that move was $2.8 billion, which he said was an absurd figure that the people of the state naturally rejected. 8:27:55 AM REPRESENTATIVE ROKEBERG revealed his strong background in commercial real estate development. He said it's always been his contention that a construction of a new capital could be accomplished for little or no cost to the state, because "private sector real estate developers would lust after the chance to build a new capital building." He mentioned a building in Anchorage that, for example, could be converted to a capital for under $35 million, but he said he's not recommending that. In regard to the previous comments of Representative Elkins to Representative Neuman, he stated: I believe in my heart of hearts that the only way we're going to get a new capitol building - and I strongly advocate that - is to have this type of competition ... throughout the state on the level playing field that everybody has a chance to make a proposal. That includes Juneau. I thoroughly believe ... that building could be in this community. I believe the people in this community would have ... a very good chance of winning that proposal. They've been reluctant to agree to the financing arrangements under this legislation; they want the legislature to pay for their new capitol building. That's the distinction here. I think that they need to make the commitment to the legislature if they want to have a legislature here ... to pay for that building themselves - not expect us to pay the bonding rent to amortize the debt on a new structure. That's the distinction. So, the folks here in Juneau need to get off their money and prove to the people in the rest of the state that they deserve to have this legislature here. That's the issue, and that's why I'm asking that the FRANK Initiative be repealed, because it's, frankly, intellectually dishonest the way it's been used in the past to scare the people of this state. 8:31:47 AM REPRESENTATIVE GARDNER noted that in 2002 there was an attempt to repeal the FRANK Initiative through a ballot proposition, and that attempt failed. She asked, "Does that not give us pause for repealing it legislatively?" 8:32:15 AM REPRESENTATIVE ROKEBERG asked Representative Gardner to consider that the man in charge of that initiative dropped the ball mid- way through. 8:33:08 AM REPRESENTATIVE GARDNER said nevertheless the initiative failed in a public vote. 8:33:17 AM REPRESENTATIVE ELKINS said that in essence, moving the legislature would "trickle down" to moving the whole capital, because there are many support agencies in Juneau. He reminded Representative Rokeberg that former Governor Bill Sheffield moved 200 jobs to Anchorage, which crippled [Juneau] in respect to real estate until recently. He added that Ketchikan also felt the impact from the loss of the economy in Juneau. 8:34:03 AM REPRESENTATIVE ROKEBERG replied that he tends to disagree with that analysis. First, he said Anchorage has historically had more state employees than Juneau. Regarding the historical impact, he said he questions the "economic ripple effect of Juneau and Ketchikan." He said it's clear that the environmental lobbies and the impacts of the closure of the Tongass National Forest to timber, and the closure of the Ketchikan Pulp Mill has had negative impacts to Southeast economy. He added, "I would be the first to admit, however, that if, in fact, the ... legislature were to move out of Juneau, it would have a negative impact. I would agree with that. That's one reason I wanted to pursue just the legislative activities and not the entire capitol building." 8:36:52 AM REPRESENTATIVE ROKEBERG referred to a letter from director of the Bureau of Education written to a United States Senator on May 3, 1890, which states that moving the capital from Sitka to Juneau would be a bad idea for many of the same arguments that still exist today. He stated his belief that what is not going to happen is to have a new capitol built in Juneau that is paid for by all the citizens of the state. He emphasized the need for a new capitol building and said he voted against the recent remodel on the House and Senate chambers because the cost was $.75 million for an ineffective and poor design. 8:38:46 AM CHAIR SEATON stated that impacts do occur when changes are made. He gave an example of the move of the ferry system to Ketchikan. 8:39:53 AM REPRESENTATIVE GRUENBERG said he agrees that this capitol building is substandard. He said the repeal of the FRANK Initiative troubles him because that initiative strengthens the initiative process in the state. The public's right to know and participate in this issue is something that the people prize, he said, and repealing the initiative would "cloud the issue." Regarding Representative Rokeberg's comments about costs being lower than stated, he suggested that, in that case, more disclosure is better than less. 8:42:04 AM REPRESENTATIVE ROKEBERG responded that philosophically that is true. Conversely, he pointed out that there have been 10 or 11 initiatives in 40 years of statehood. He said the community of Juneau rightfully does everything it can to hang on to the legislature. He stated that the people of Alaska have expressed their will in "some of these votes" approving a new location. Furthermore, he said the Alaska State Constitution provides that the legislature can provide its own home. He said HB 23 would allow the legislature to do that through the repeal of the FRANK Initiative. 8:43:32 AM REPRESENTATIVE GRUENBERG noted that the Alaska State Constitution also specifically provides that the people of the state can adopt initiatives, which they have done through the FRANK Initiative. 8:44:30 AM CHAIR SEATON stated: My understanding is that the repeal of this provision ... addresses the dollar lease to the state, whereas the FRANK Initiative would require the analysis of the total value of the land - the total cost of the buildings, even though we're not going to pay for those buildings - we're not going to pay for that land, but that would be the bondable cost of the capitol .... I think that this is what Representative Rokeberg was talking about was the bondable cost of a building that we're not building actually gives us a false picture of what we're doing. And the FRANK Initiative was based on us building a new capitol. 8:45:24 AM REPRESENTATIVE GRUENBERG directed attention to AS 44.06.055, which read as follows: Sec. 44.06.055. Relocation expenditures. State money may be expended to relocate physically the capital or the legislature from the present location only after a majority of those voting in a statewide election have approved a bond issue that includes all bondable costs to the state of the relocation of a functional state legislature or capital to the new site over the twelve-year period following such approval. The commission established in AS 44.06.060 shall determine all bondable costs and total costs including, but not limited to, the costs of moving personnel and offices to the relocation site; the social, economic, and environmental costs to the present and relocation sites; and the costs to the state of planning, building, furnishing, using, and financing facilities at least equal to those provided by the present capital city. REPRESENTATIVE GRUENBERG said the only thing that has to be given to the voters in a referendum under the FRANK Initiative is "the bondable issue." If, in fact, there are not state bonds, he observed, then the FRANK Initiative "would not require that the voters approve it." He added, "So, we should not repeal it." He said the question in his mind is whether the FRANK Initiative would apply to the deal. If it does not, he reasoned, then it does not have to be repealed. He concluded, "That just clouds the issue." 8:46:18 AM REPRESENTATIVE ROKEBERG noted that there is an attorney general's opinion that drove the issue pertaining to the definition of all bondable costs. He stated his understanding of that opinion is that "anything that could be bonded was to be part of the dollar amount." REPRESENTATIVE GRUENBERG said his interpretation is that that means "bondable costs to the state, not the citizens of Juneau." REPRESENTATIVE ROKEBERG responded, "It doesn't say that, and that's how the AG's opinion is." 8:47:07 AM CHAIR SEATON said this is a question that needs to be resolved, and he asked Representative Rokeberg to get the AG's opinion to the committee. 8:47:30 AM REPRESENTATIVE ELKINS asked if the state would be required to underwrite any of the bonds. 8:47:45 AM REPRESENTATIVE ROKEBERG answered no, not the way HB 23 is drafted. He noted that he recently had served on the committee for capitol planning at the request of Juneau's Mayor Bruce Bothello. The cost of that proposal, under the FRANK Initiative, should have gone on the ballot for the approval of the public. 8:48:56 AM CHAIR SEATON, after ascertaining that there was no one to testify, closed public testimony. In response to a request from Representative Gardner, he said he would reopen public testimony at a later date for anyone who just received the committee substitute and wishes to testify. 8:50:19 AM REPRESENTATIVE GRUENBERG said whether the capital is ultimately moved "under the rest of the bill" is a potential issue, whereas the repeal of the FRANK Initiative would occur immediately; therefore, he said he agrees with Representative Gardner that there may be people who want to testify. 8:51:14 AM CHAIR SEATON stated his interest in obtaining an opinion from Legislative Legal and Research Services regarding the applicability of bonding. 8:51:44 AM REPRESENTATIVE GRUENBERG asked that someone from the Office of the Attorney General be prepared to testify. 8:52:05 AM CHAIR SEATON announced that HB 23 was heard and held.
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