Legislature(2005 - 2006)BUTROVICH 205

03/22/2005 01:30 PM TRANSPORTATION

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01:37:12 PM Start
01:37:12 PM SB16
02:24:44 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Scheduled But Not Heard
Bills Previously Heard/Scheduled
                    ALASKA STATE LEGISLATURE                                                                                  
            SENATE TRANSPORTATION STANDING COMMITTEE                                                                          
                         March 22, 2005                                                                                         
                           1:37 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Senator Charlie Huggins, Chair                                                                                                  
Senator John Cowdery, Vice Chair                                                                                                
Senator Gene Therriault                                                                                                         
Senator Albert Kookesh                                                                                                          
MEMBERS ABSENT                                                                                                                
Senator Hollis French                                                                                                           
COMMITTEE CALENDAR                                                                                                            
SPONSOR SUBSTITUTE FOR SENATE BILL NO. 16                                                                                       
"An Act  relating to the powers  and duties of the  Department of                                                               
Transportation and  Public Facilities; repealing  the requirement                                                               
for   a  long-range   program   for   highway  construction   and                                                               
maintenance; and  repealing a requirement that  public facilities                                                               
comply  with  energy  standards  adopted  by  the  Department  of                                                               
Transportation and Public Facilities."                                                                                          
     HEARD AND HELD                                                                                                             
SENATE BILL NO. 133                                                                                                             
"An Act establishing the Aviation Advisory Board; and providing                                                                 
for an effective date."                                                                                                         
     SCHEDULED BUT NOT HEARD                                                                                                    
PREVIOUS COMMITTEE ACTION                                                                                                     
BILL: SB 16                                                                                                                   
SHORT TITLE: POWERS/DUTIES DOTPF/TRANSPORTATION PLAN                                                                            
SPONSOR(s): SENATOR(s) STEVENS G                                                                                                
01/11/05       (S)       PREFILE RELEASED 12/30/04                                                                              
01/11/05       (S)       READ THE FIRST TIME - REFERRALS                                                                        
01/11/05       (S)       TRA, FIN                                                                                               
01/14/05       (S)       SPONSOR SUBSTITUTE INTRODUCED-REFERRALS                                                                
01/14/05       (S)       TRA, FIN                                                                                               
03/22/05       (S)       TRA AT 1:30 PM BUTROVICH 205                                                                           
BILL: SB 133                                                                                                                  
SHORT TITLE: AVIATION ADVISORY BOARD                                                                                            
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
03/07/05       (S)       READ THE FIRST TIME - REFERRALS                                                                        
03/07/05       (S)       TRA, FIN                                                                                               
03/22/05       (S)       TRA AT 1:30 PM BUTROVICH 205                                                                           
WITNESS REGISTER                                                                                                              
Mr. Doug Letch, Legislative Aide                                                                                                
Senator Gary Stephens                                                                                                           
Alaska State Capitol                                                                                                            
Juneau, AK  99801-1182                                                                                                          
POSITION STATEMENT:  Introduced SB 16                                                                                         
Mr. Jeff Ottesen, Director                                                                                                      
Department of Transportation & Public Facilities                                                                                
3132 Channel Dr.                                                                                                                
Juneau, AK  99801-7898                                                                                                          
POSITION STATEMENT:  Testified in support of SB 16                                                                            
Mr. Jeff Parker, Attorney                                                                                                       
Anchorage, AK                                                                                                                   
POSITION STATEMENT:  Testified in opposition to SB 16                                                                         
ACTION NARRATIVE                                                                                                              
CHAIR CHARLIE HUGGINS called the Senate Transportation Standing                                                               
Committee meeting to order at 1:37:12 PM. Present were Senators                                                               
Gene Therriault, John Cowdery, and Chair Charlie Huggins.                                                                       
CHAIR HUGGINS informed the committee SB 131 would not be heard                                                                  
this day.                                                                                                                       
         SB 16-POWERS/DUTIES DOTPF/TRANSPORTATION PLAN                                                                      
1:37:12 PM                                                                                                                    
CHAIR HUGGINS announced SB 16 to be up for consideration.                                                                       
SENATOR COWDERY moved to adopt the proposed committee substitute                                                                
referred to as Version \I as the working document. There being                                                                  
no objection, the motion carried.                                                                                               
1:38:38 PM                                                                                                                    
MR. DOUG  LETCH, staff to  Senator Gary Stevens, presented  SB 16                                                               
at  the request  of  the Department  of  Transportation &  Public                                                               
Facilities (DOT/PF).  SB 16 updates obsolete  language in statute                                                               
related  to  the  powers  of  the DOT/PF.  It  also  removes  the                                                               
requirement for  the DOT to  conduct a cost/benefit  analysis for                                                               
all of its  projects. The passage of SB 16  is desirable to avoid                                                               
future costly litigation.                                                                                                       
1:40:39 PM                                                                                                                    
SENATOR COWDERY asked  Mr. Letch if a dollar  value is considered                                                               
for a project before a study was required.                                                                                      
MR. LETCH answered  cost/benefit studies are required  to be done                                                               
on  projects  such  as  repairing  road  damages  and  performing                                                               
emergency repairs.                                                                                                              
1:41:55 PM                                                                                                                    
MR. JEFF  OTTESEN, Director,  Program Development,  Department of                                                               
Transportation & Public Facilities  (DOTPF), supported SB 16. The                                                               
core  of SB  16  is  the provision  that  speaks to  cost/benefit                                                               
language. The other changes are  merely housekeeping measures. He                                                               
referred to Section 1 and stated  the DOT has been issuing grants                                                               
for several  years with no  legal authority  to do so.  Section 3                                                               
addresses language  that was established  in statute  by Governor                                                               
Hammond  at  the  time  the  DOT  was  created.  To  fulfill  the                                                               
requirement of  the DOT updating a  statewide transportation plan                                                               
annually,  the  DOT would  have  to  increase staff  and  budgets                                                               
tenfold. The DOT  would like to change the  annual requirement to                                                               
a periodic duty.                                                                                                                
1:44:41 PM                                                                                                                    
MR.  OTTESEN  said it  is  difficult  to perform  a  cost/benefit                                                               
analysis when considering a project  that will be done 5-15 years                                                               
in the future. The data is  relatively sparse yet DOT is required                                                               
to  do the  expensive study.  Currently  the DOT  is required  to                                                               
perform  a cost/benefit  analysis  for installing  a simple  stop                                                               
1:45:38 PM                                                                                                                    
SENATOR COWDERY asked Mr. OTTESEN  whether the current system has                                                               
been abused in order to stop projects.                                                                                          
MR. OTTESEN answered yes. The  road between Iliamna and Nondalton                                                               
is an  example. Litigation was used  to stop the project  and two                                                               
men died recently  crossing the river because the  bridge was not                                                               
MR. OTTESEN  added the  DOT received a  letter from  a non-profit                                                               
agency  asking  whether  a  cost/benefit   study  had  been  done                                                               
regarding  the road  out  of Juneau.  He said  a  strict look  at                                                               
cost/benefit analysis  is difficult. Many  of the things  the DOT                                                               
builds  in Alaska  are not  cost effective,  such as  airports in                                                               
rural areas.                                                                                                                    
1:47:33 PM                                                                                                                    
CHAIR HUGGINS  asked Mr. Ottesen  how the regulation was  used to                                                               
block the construction of the bridge at Nondalton.                                                                              
MR. OTTESEN explained  the lawsuit was based on the  fact the DOT                                                               
had not  conducted a cost/benefit  analysis when it  selected the                                                               
project.  Work  began  in  1995  and  was  well  under  way  when                                                               
litigation was filed  in 2002. The judge ordered the  DOT to do a                                                               
cost/benefit  analysis  on the  project,  which  cost $60,000  in                                                               
consultant costs  and another  $30,000 in  staff costs  to update                                                               
the plan. January  of 2005 they went back to  court and the judge                                                               
dismissed the injunction.                                                                                                       
SENATOR COWDERY asked who brought the suit.                                                                                     
MR. OTTESEN  replied it  was an individual  who owns  property 14                                                               
miles from the  bridge. The communities surrounding  the area are                                                               
supportive of the project.                                                                                                      
SENATOR  COWDERY  asked  whether   it  was  considered  a  public                                                               
interest lawsuit.                                                                                                               
MR.  OTTESEN replied  the two  names  on the  lawsuit were  Trout                                                               
Unlimited and Robert Gillam.                                                                                                    
1:50:41 PM                                                                                                                    
CHAIR HUGGINS  asked Mr. Ottesen  the elements of  a cost/benefit                                                               
MR.  OTTESEN  explained  they  add up  all  costs,  subtract  any                                                               
identified transportation  savings and divide that  number by the                                                               
future  population of  the area,  which  gives a  cost-per-person                                                               
served figure.                                                                                                                  
1:52:39 PM                                                                                                                    
MR.  OTTESEN referred  to a  map given  to committee  members and                                                               
explained  the   color  green  represents   a  true   road,  blue                                                               
represents  a  gravel  road and  red  represents  an  all-terrain                                                               
vehicle (ATV) trail.                                                                                                            
CHAIR HUGGINS asked  Mr. Ottesen to explain the  process they are                                                               
using today.                                                                                                                    
MR. OTTESEN assured the committee  he would provide them with the                                                               
information. He added the DOT  complies with a Federal Rules book                                                               
when researching projects.                                                                                                      
1:55:10 PM                                                                                                                    
CHAIR HUGGINS asked Mr. Ottesen to explain grants and awards.                                                                   
MR. OTTESEN explained  the Highway Safety Office  has the ability                                                               
to issue grants. They receive  approximately $7 million each year                                                               
from the  National Highway Transportation  Safety Administration.                                                               
They focus  on the  behavior side  of highway  safety. Non-profit                                                               
groups and elderly programs are  eligible to receive money to buy                                                               
vans and  to organize  transportation. The  DOT has  been issuing                                                               
grants by the  authority of the capitol budget  process, but they                                                               
are not authorized in statute. SB 16 will fix the disconnect.                                                                   
1:57:34 PM                                                                                                                    
CHAIR  HUGGINS  asked  him  to  explain  how  the  DOT/PF  issued                                                               
$200,000 to  the University  of Alaska in  Fairbanks (UAF)  for a                                                               
paving project.                                                                                                                 
MR. OTTESEN  explained the  DOT is allowed  to transfer  funds to                                                               
other  governmental organizations  as a  government-to-government                                                               
transfer.  The  state  procurement  code  authorizes  that  as  a                                                               
transfer that  does not require  procurement. Examples  of grants                                                               
they issue would  be those to Catholic  Community Services, MADD,                                                               
and other non-governmental entities.                                                                                            
1:59:19 PM                                                                                                                    
SENATOR COWDERY  recalled a grant  from discretionary  funds that                                                               
was issued by himself to UAF through the DOT.                                                                                   
CHAIR HUGGINS  announced SB  16 would not  pass out  of committee                                                               
MR. OTTESEN  said the  DOT/PF feels they  are lacking  full legal                                                               
authority to issue grants to non-governmental entities.                                                                         
SENATOR  COWDERY asked  whether UAF  was considered  a government                                                               
MR. OTTESEN  replied yes.  There is a  specific exemption  in the                                                               
state procurement code for government-to-government transfer.                                                                   
Senator Albert Kookesh joined the committee at 2:01:06 PM.                                                                    
CHAIR  HUGGINS   asked  Mr.  Ottesen   to  define   the  DOT/PF's                                                               
perception of periodic evaluation.                                                                                              
MR. OTTESEN  said there is  a constant oversight of  programs and                                                               
they use a check and balance system.                                                                                            
CHAIR HUGGINS suggested there be a recurring date.                                                                              
MR.  OTTESEN agreed  every three-five  years would  be easier  to                                                               
absorb  into the  budget than  annually. He  added transportation                                                               
finance is undergoing a rapid change.  The fuel tax on gallons is                                                               
no longer serving  the DOT/PF well. Hybrid and  hydrogen cars are                                                               
part of the reason. The State  of Texas has decided to toll their                                                               
entire  highway and  freeway system  because they  recognize that                                                               
gas taxes are not achieving state financial goals.                                                                              
2:04:40 PM                                                                                                                    
CHAIR HUGGINS asked  Mr. Ottesen to explain  Section 2, paragraph                                                               
MR. OTTESEN  answered it was for  municipalities with populations                                                               
of  less  than 12,000  and  for  unincorporated communities.  The                                                               
entire funding has lapsed and the  DOT/PF no longer has the staff                                                               
to perform building maintenance  and inventories. Other districts                                                               
have taken over those duties.                                                                                                   
2:06:59 PM                                                                                                                    
CHAIR  HUGGINS asked  what buildings  were  maintained in  places                                                               
such as Nome and Kotzebue.                                                                                                      
MR. OTTESEN  answered there were  many public buildings  but they                                                               
are owned  by the cities of  Nome and Kotzebue. He  added the DOT                                                               
owns  transportation assets,  such as  buildings that  house fire                                                               
rescue and some airport terminals.                                                                                              
CHAIR HUGGINS asked whether SB 16  would relieve the DOT from the                                                               
responsibility of maintaining public buildings.                                                                                 
MR. OTTESEN responded  the DOT/PF has not been  funded or staffed                                                               
to perform those duties for over a decade.                                                                                      
2:08:08 PM                                                                                                                    
CHAIR HUGGINS stated somebody should be responsible.                                                                            
MR.  OTTESEN asserted  the  state  has turned  it's  back on  the                                                               
responsibility.   Local   governments   will  advocate   to   the                                                               
Legislature directly when seeking funding.                                                                                      
CHAIR  HUGGINS asked  Senator Kookesh  to  comment on  government                                                               
entities other than the DOT/PF maintaining public buildings.                                                                    
SENATOR KOOKESH replied he is  aware of a requirement for schools                                                               
to maintain a maintenance program.                                                                                              
MR. OTTESEN commented that requirement  comes from the Department                                                               
of Education.  SB 16 would  not apply  to a state  owned building                                                               
located in a small community.                                                                                                   
CHAIR HUGGINS  asked who  owns the buildings  that the  DOT/PF is                                                               
trying to lose responsibility of.                                                                                               
MR.  OTTESEN  replied  the  local  governments  or  local  school                                                               
2:09:42 PM                                                                                                                    
CHAIR HUGGINS asked  whether the Department of  Fish and Wildlife                                                               
were affected.                                                                                                                  
MR. OTTESEN  replied they are  in state buildings and  the DOT/PF                                                               
still works with  them. Most agencies have  their own maintenance                                                               
programs.  Section 2  is  about DOT/PF  being  involved in  local                                                               
governments with populations under 12,000.                                                                                      
2:12:00 PM                                                                                                                    
MR. OTTESEN  noted Section 4  is about  the process by  which the                                                               
DOT develops the  list of projects to be constructed  in the near                                                               
term. SB 16 is  an attempt to clean up the  statute to conform to                                                               
DOT current practices.                                                                                                          
2:15:16 PM                                                                                                                    
MR.  JEFF  PARKER,  attorney,   testified  he  represented  Trout                                                               
Unlimited and Robert  Gillam in the previously  referred to court                                                               
case. He  testified in opposition  to SB  16. He offered  to work                                                               
with the  committee to make  SB 16 acceptable. He  disagreed with                                                               
Mr. Ottesen's  testimony and said  the DOT  cost/benefit analysis                                                               
requirements applied  only to new transportation  and facilities.                                                               
He  agreed  the  current  statute   is  ambiguous  and  could  be                                                               
improved. Most  people would support  a provision to  establish a                                                               
monetary level below  which a cost/benefit analysis  would not be                                                               
required.  He  suggested providing  a  definition  for the  words                                                               
"facility" and "periodically".                                                                                                  
2:19:40 PM                                                                                                                    
MR. PARKER  said it was  not fair  to call the  statute obsolete.                                                               
The consideration  of cost/benefit analysis is  common sense. The                                                               
DOT/PF needs  only to  address those problems  that occur  on the                                                               
2:20:50 PM                                                                                                                    
CHAIR HUGGINS asked Mr. Parker the concerns his clients have.                                                                   
MR. PARKER answered  Trout Unlimited is the  nations largest cold                                                               
water  fisheries  conservation   organization  with  700  Alaskan                                                               
members. They  are generally  involved in a  variety of  land use                                                               
habitat fishery management issues,  as well as any transportation                                                               
issues  that  may  impact  fisheries.   Their  concern  with  the                                                               
Iliamna-Nondalton bridge  project is the environmental  impact to                                                               
the  fishery and  its  intended connection  to  the Pebble  Beach                                                               
2:22:52 PM                                                                                                                    
CHAIR HUGGINS  asked whether Trout Unlimited  was concerned about                                                               
the mining interest.                                                                                                            
MR. PARKER said yes.                                                                                                            
2:24:14 PM                                                                                                                    
CHAIR HUGGINS held SB 16 in committee.                                                                                          
There being  no further  business to  come before  the committee,                                                               
Chair Huggins adjourned the meeting at 2:24:44 PM.                                                                            

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