Legislature(1997 - 1998)
03/27/1997 03:35 PM Senate STA
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
Number 178
SB 21 ALASKA MARINE HIGHWAY AUTHORITY
CHAIRMAN GREEN brought SB 21 before the committee as the next order
of business.
JOE AMBROSE , staff to Senator Robin Taylor who is the prime sponsor
of SB 21, directed attention to a proposed Amendment No. 3.
(Amendments one and two were adopted at the previous hearing on the
bill.)
SENATOR WARD moved adoption of the following Amendment No. 3.
SENATOR DUNCAN objected and asked for an explanation of what the
amendment does.
SENATOR WARD moved adoption of the following Amendment No. 3:
Amendment No. 3
Page 16, lines 12 - 16: Delete "In this subsection, "commissioner
of the department that operates the marine vessel" includes the
president of the University of Alaska with regard to a vessel
operated by the university and the chief executive officer of the
Alaska Marine Highway Authority with regard to a vessel operated by
the Alaska Marine Highway Authority."
Insert "A detailed list of the costs and factors considered in
calculating the interport differential must be provided to each
person who expresses an interest in submitting a bid to perform
maintenance or repair work on a marine vessel owned by the state.
[IN THIS SUBSECTION, "COMMISSIONER OF THE DEPARTMENT THAT OPERATES
THE MARINE VESSEL" INCLUDES THE PRESIDENT OF THE UNIVERSITY OF
ALASKA WITH REGARD TO A VESSEL OPERATED BY THE UNIVERSITY.]"
Page 16, line 18, through page 17, line 1: Delete all material and
insert:
"(c) The commissioner of a department that operates a marine
vessel shall adopt regulations establishing the criteria that the
department shall use to determine whether the cost of maintenance
or repair work at a shipyard facility located int he state is
reasonable under (a) of this section. The commissioner shall
designate by regulation the designated base port for each vessel
operated by the department. A vessel's designated base port is the
vessel's delivery and redelivery port. The Alaska Marine Highway
Authority shall adopt regulations establishing the criteria that
the authority shall use in calculating the interport differential
under this section. The criteria for calculating the interport
differential must include costs incurred from the time that the
vessel leaves the vessel's designated base port to enter the
shipyard facility until the time the vessel returns to the
designated base port from the shipyard facility.
(d) In this section,
(1) "commissioner of the department that operates the
marine vessel" includes the president of the University of Alaska
with regard to a vessel operated by the university and the chief
executive officer of the Alaska Marine Highway Authority with
regard to a vessel operated by the Alaska Marine Highway Authority;
(2) "interport differential" includes all costs related
to the performance of the maintenance or repair work of a marine
vessel at a shipyard located outside of the state, including travel
costs incurred moving the vessel from its designated base port to
the shipyard outside of the state; additional fuel consumption;
cost of consumable including lubricants and other engine and deck
stores; maintenance costs incurred during running time; cost of
crew transfers including airfare between Alaska and the shipyard;
wages in travel status; crew room and board; and other interport
costs identified by the Alaska Marine Highway Authority."
Number 200
MR. AMBROSE , speaking to Amendment No. 3, explained there has been
discussion with DOTPF on a provision in the legislation that deals
with the use of Alaska shipyards, and he believes the new language
in the amendment is less onerous. He said the intent throughout
this process is to make use of the two shipyards, which the state
of Alaska has spent a tremendous amount of money on, a little more
practical.
Mr. Ambrose said a major change being made in the amendment
requires that the commissioner, by regulation, designate a base
port for each vessel, and that base port then becomes the delivery
and redelivery port for the vessel. He said the delivery and
redelivery port is important because that is the point of
calculation for the interport differential when a vessel is shipped
out of state. Federal highway authorities have indicated that in
order to use that calculation all the time, there has to be a
delivery and redelivery port. The second change is the defining of
"interport differential" which is all costs related to moving a
vessel to an out-of-state shipyard.
Number 325
GARY HAYDEN , Director, Alaska Marine Highway System, Department of
Transportation & Public Facilities, stated the Marine Highway
System has demonstrated a commitment to doing work in Alaska
shipyards. Over the last seven years, most of the work that did
not involve federal funds has been done in Alaska. When federal
funds are involved, it necessitates going out to bid on these
projects.
Mr. Hayden questioned the need for the amendment because he wasn't
sure there was a problem at this point in time. He referenced a
Legislative Budget & Audit Committee report where it stated they
found the method used by DOTPF in determining the interport
differential for bidding purposes to be sound and based upon a
logical approach for determining vessel transport related costs.
He also suggested that if a Alaska Marine Highway Authority is
going to be established, maybe a good approach to this issue is to
let its board of directors and executive director make the decision
has to how they go out and put together their bidding package on
getting their ships maintained.
Mr. Hayden said there is definitely an issue of declining
maintenance funds, while at the same time, the ships are getting
older and the cost of maintenance is going up. His approach to
getting the most possible out of the maintenance dollars has been
to have competition and get good prices on the work that is being
done.
Mr. Hayden explained that in calculating the interport differential
it starts at the point that the vessel is taken off line. Juneau,
Ketchikan and Seward are currently designated the home ports for
the vessels, but the home port designations are just for the
purpose of crew changes. He questioned designating a base port in
regulation because it ties the system's hands as to where they take
the vessel off a revenue run. The past practice has been to take
it off at the end of the revenue run, and then that would be the
start of their calculations.
Number 410
MR. AMBROSE pointed out that nothing in the amendment would affect
the competitive bidding process, and nothing in the bill is
intended to give the Alaska shipyards so much of an advantage that
bids would be awarded that were not fair to the state as far as
expense is concerned.
Number 430
There being no further objection to Amendment No. 3, it was
adopted.
CHAIRMAN GREEN asked for the will of the committee on CSSB 21(STA).
SENATOR WARD moved CSSB 21(STA), as amended, be passed out of
committee with individual recommendations. SENATOR DUNCAN objected
and stated he was concerned about this piece of legislation. The
roll was taken with the following result: Senators Ward and Green
voted "Yea" and Senator Duncan voted "Nay." CHAIRMAN GREEN stated
the motion to move CSSB 21(STA) out of committee failed.
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