Legislature(2003 - 2004)
04/24/2003 09:08 AM House CRA
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= bill was previously heard/scheduled
ALASKA STATE LEGISLATURE
HOUSE COMMUNITY AND REGIONAL AFFAIRS
STANDING COMMITTEE
April 24, 2003
9:08 a.m.
MEMBERS PRESENT
Representative Carl Morgan, Chair
Representative Kelly Wolf, Vice Chair
Representative Pete Kott
Representative Tom Anderson
Representative Ralph Samuels
Representative Sharon Cissna
Representative Albert Kookesh
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
HOUSE BILL NO. 264
"An Act relating to the review of certain state public
construction projects for compliance with building and other
safety codes, relating to the inspection of certain state public
construction projects, and exempting certain state public
construction projects from obtaining building permits from
municipalities, from municipal inspection during construction,
and from complying with a review requirement; and providing for
an effective date."
- MOVED HB 264 OUT OF COMMITTEE
PREVIOUS ACTION
BILL: HB 264
SHORT TITLE:STATE CONSTR. PROJECTS; REVIEW/INSPECTION
SPONSOR(S): REPRESENTATIVE(S)ROKEBERG
Jrn-Date Jrn-Page Action
04/14/03 0964 (H) READ THE FIRST TIME -
REFERRALS
04/14/03 0964 (H) CRA, L&C, FIN
04/24/03 (H) CRA AT 9:00 AM CAPITOL 124
WITNESS REGISTER
REPRESENTATIVE NORMAN ROKEBERG
Alaska State Legislature
Juneau, Alaska
POSITION STATEMENT: Spoke as the sponsor of HB 264.
TIM ROGERS, Legislative Program Coordinator
Municipality of Anchorage
Anchorage, Alaska
POSITION STATEMENT: Testified that he wasn't sure HB 264, in
its current state, would accomplish what everyone is after.
NANCY SLAGLE, Director
Administrative Services
Department of Transportation & Public Facilities
Juneau, Alaska
POSITION STATEMENT: Addressed the zero fiscal note of HB 264.
SAM KITO, III, Transportation Development Manager
Planning Division
Department of Community Development
City & Borough of Juneau
Juneau, Alaska
POSITION STATEMENT: Expressed concerns with regard to HB 264.
ACTION NARRATIVE
TAPE 03-16, SIDE A
Number 0001
CHAIR CARL MORGAN called the House Community and Regional
Affairs Standing Committee meeting to order at 9:08 a.m.
Representatives Morgan, Anderson, Samuels, and Cissna were
present at the call to order. Representatives Wolf, Kott, and
Kookesh arrived as the meeting was in progress.
HB 264-STATE CONSTR. PROJECTS; REVIEW/INSPECTION
CHAIR MORGAN announced that the only order of business would be
HOUSE BILL NO. 264, "An Act relating to the review of certain
state public construction projects for compliance with building
and other safety codes, relating to the inspection of certain
state public construction projects, and exempting certain state
public construction projects from obtaining building permits
from municipalities, from municipal inspection during
construction, and from complying with a review requirement; and
providing for an effective date."
Number 0073
REPRESENTATIVE NORMAN ROKEBERG, Alaska State Legislature, spoke
as the sponsor of HB 264. He began by mentioning that the Ted
Stevens Anchorage International Airport (TSAIA) is the
motivation for the introduction of HB 264. Representative
Rokeberg explained that the legislature entered into agreements
with the administration to enter into agreements with the air
carriers for a large construction project that would add to and
rebuild Concourse C and other amenities. This project has been
delayed due to seismic designs, plan checking, and review prior
to the issuance of building permits. These delays precipitated
a recent joint meeting of the House and Senate Transportation
Standing Committees during which the Department of
Transportation & Public Facilities (DOT&PF) discussed the $33
million in cost overruns resulting from "this breakdown in the
planning process." The aforementioned is part of the committee
packet. The committee packet should also contain the Joint
Committee on Legislative Budget and Audit review of the
situation, which suggested the need for remedial legislation in
order to ensure that [the delays and cost overruns] don't happen
again.
Number 0293
REPRESENTATIVE ROKEBERG explained that HB 264 would allow
DOT&PF, for projects over $1 million in valuation, to
immediately have the plan reviewed by a third-party
organization, such as the International Code Council (ICC). The
issue is the relationship between the state, DOT&PF, and the
municipal governments that have plan reviews or building
officials in the jurisdiction [of the project]. He indicated
that mainly the larger communities, such as Anchorage,
Fairbanks, and Juneau, have plan reviews by building officials.
Typically, the process is such that one would obtain working
drawings from an architect/consulting engineer and those plans
would be taken to the building officials for review on matters
of zoning and fire as well as the various building disciplines.
Therefore, there will be variations between the codes of various
jurisdictions.
REPRESENTATIVE ROKEBERG related his understanding that in order
to expedite large projects there would usually be an agreement
between the developer, the building officials, and the
municipality to send the plans for review. However, the
aforementioned didn't occur with TSAIA. He opined that such
review could've avoided the almost two years of delay and saved
the state considerable money. However, the current situation
means that the department will have to return to the legislature
for further bonding authorization.
REPRESENTATIVE ROKEBERG concluded by noting that there may be
some technical issues that need to be worked out. He noted that
HB 264 has three committees of referral and if this committee
decides to move it to the next committee of referral, the House
Labor and Commerce Standing Committee, he pledged to work with
all involved parties over the interim. He announced that he
didn't intend for this legislation to move through the process
this session. His intention, he said, is to focus on the plan
checking, however the current legislation doesn't quite meet
that goal.
Number 0812
REPRESENTATIVE CISSNA commented that this problem couldn't be
unique to Alaska. Therefore, she inquired as to what other
states do in similar situations.
REPRESENTATIVE ROKEBERG, speaking from his personal background
in real estate, related that this [third-party plan check] is
frequently performed. In Alaska, construction is typically done
in the spring and summer. Therefore, the departments performing
building checks can't manage the volume created during the
concentrated flurry of building. The [third-party plan check]
has been used in the past in order to avoid the bottleneck and
ensure that projects proceed in a timely manner. In further
response to Representative Cissna, Representative Rokeberg
pointed out that the audit done by the Joint Committee on
Legislative Budget and Audit specifies: "Local regulation of
state construction is not a universal practice in other states.
Our survey of the practices of 24 other states determined that
state construction is not subject to local building permits in
18 of those 24 states." Whether the state is even subject to
local building review is one of the issues, he said.
Number 1047
REPRESENTATIVE CISSNA highlighted the importance of local
knowledge in these situations. She recalled that after the
tidal wave in Kodiak, experts from "Urban Renewal" came in from
Washington, D.C., and planned the community below the high tide
line. Therefore, she asked if the local [officials] could be
part of the team.
REPRESENTATIVE ROKEBERG agreed with Representative Cissna and
related that the intention of HB 264 isn't to circumvent local
control, particularly with regard to land use planning elements.
This legislation focuses on the architectural and engineering
drawings for plan review. Whether the standards adopted are
national or regional building codes, professionals from other
jurisdictions can know the code as well as the local plan
checkers. He noted that the legislation needs to be tweaked so
that local input is included. In fact, Alaska has a law that
requires local plan checking in order to obtain a local permit.
Number 1179
REPRESENTATIVE SAMUELS informed the committee that before the
TSAIA project started, the rental fees of one of the air
carriers increased by about two-fold. Therefore, for a very
small company the excess fees amounted to about $200,000 and
those excess fees aren't going to generate any extra passengers,
and therefore the fares will be raised. Furthermore, all the
employees of this small air carrier are impacted.
REPRESENTATIVE KOOKESH asked if the rental fees to which
Representative Samuels spoke would've been raised anyway, had
the project been completed on time.
REPRESENTATIVE SAMUELS said that all of the delays have resulted
in what will amount to an extra $50 million in fees. Although
the rental fees would have increased, they wouldn't have
doubled.
Number 1351
REPRESENTATIVE KOOKESH turned to the zero fiscal note and
inquired as to who will pay for the review performed by national
organizations.
REPRESENTATIVE ROKEBERG explained that currently the plan
checking is carried out by the municipal government. "The
developer of the state is paying for it now," he specified.
With regard to who will receive the cost of the plan check,
Representative Rokeberg related that there would be an offset.
The presumption is that if the fee isn't paid to the
municipality, it would be paid to the third party, and therefore
it would be a wash.
REPRESENTATIVE KOOKESH said that he didn't agree.
REPRESENTATIVE ROKEBERG acknowledged that he didn't have the
empirical evidence to support the presumption.
CHAIR MORGAN inquired as to how much more bonding is going to be
requested and who will pay for it.
REPRESENTATIVE ROKEBERG informed the committee that DOT&PF is
coming to the legislature to request that the dollar cap on the
level of bonding be raised. He recalled that it is in the $120-
$180 million range. He explained that the payment of the
aforementioned would come from the revenues of the airport, to
which Representative Samuels was referring. He acknowledged
that there is a connection between the operating costs and the
fare structure and ultimate cost to the public.
CHAIR MORGAN highlighted that Anchorage is the hub of the state,
although it's becoming more difficult to get to Alaska because
the air carriers face [increased fees]. However, in the end the
consumer will be the one that pays for the additional bonding.
REPRESENTATIVE ROKEBERG remarked that the intent of HB 264 is to
avoid the mistakes of the past and lower the costs to the
public.
Number 1566
TIM ROGERS, Legislative Program Coordinator, Municipality of
Anchorage (MOA), said that MOA shares the frustrations
associated with the cost overruns and the time delays involved
with the TSAIA expansion. He offered that if the municipality
can do anything to streamline the process, it wants to be able
to do so. However, he said he wasn't sure that HB 264, in its
current state, would've solved the problems that occurred in the
project.
MR. ROGERS turned attention to a letter from Craig Campbell,
then Executive Director, Office of Planning, Development, and
Public Works, MOA, dated June 6, 2002. This letter presents
MOA's side of some of the issues cited in the audit. Mr. Rogers
related that the municipality contends that the delays are due
to engineering defects caused by the consultant engineer. The
municipality did hire an engineering firm to review the project
and act as MOA's agent. As the letter specifies, there were
considerable delays in making changes suggested by the
consulting engineering firm. However, Mr. Rogers acknowledged
that the municipality isn't entirely blameless -- there's room
for improvement. Mr. Rogers said that [MOA] has realized that
the permitting process for large projects is extremely
cumbersome and, in a lot of cases, for good reason. Work to
streamline the permitting process began in 1994. Mr. Rogers
said that [MOA] is more than willing to work with the sponsor in
order to develop ways in which to streamline the process. Mr.
Rogers reiterated that he wasn't sure that HB 264, in its
current state, would accomplish what everyone is after.
REPRESENTATIVE KOOKESH returned to the issue of the zero fiscal
note and inquired as to who would pay for the third party or
local engineers to oversee these projects.
Number 1794
NANCY SLAGLE, Director, Administrative Services, Department of
Transportation & Public Facilities, noted that she isn't an
expert on the matter of building permits. In response to
Representative Kookesh, Ms. Slagle said that the cost for the
third party or local engineer to oversee a project would be part
of the cost of the project. For instance, in the past when
permitting fees were paid to the local municipality/city, it was
part of the construction cost as would be the case with this
requirement. There would be a slight offset. She said she
didn't believe this legislation would create a major cost
savings or cost to the project. From that perspective, it
should zero out.
Number 1838
REPRESENTATIVE CISSNA related her assumption that it's difficult
to guesstimate the impact of this legislation, especially when
the sponsor has expressed the need to fine-tune the legislation.
MS. SLAGLE acknowledged that many things can happen in the
building of a facility and those things could cause additional
cost overruns. In the case of TSAIA, the delays kept the
contractor idle for a couple of years, which was costly.
Furthermore, the amount of administrative overhead necessary to
respond to the concerns by the municipality was a cost. Ms.
Slagle agreed with Representative Cissna that it's difficult to
estimate the cost of this legislation. However, this
legislation may provide the state with a bit more control over
its resources than otherwise.
REPRESENTATIVE KOOKESH indicated that he hasn't seen many
projects being done in Anchorage for less than $1 million; the
cap seems a little low, which is of concern. Very little can be
built for less than $1 million and have local involvement.
MS. SLAGLE related her understanding that in the last five years
there have only been one or two projects that would fall under
this $1 million cap.
Number 2014
SAM KITO, III, Transportation Development Manager, Planning
Division, Department of Community Development, City & Borough of
Juneau, mentioned that the committee should receive a letter
from the City & Borough of Juneau, which does have concerns with
regard to HB 264. For Juneau and many communities in the Lower
48 and Alaska with building officials, there are a lot of local
requirements for projects. This legislation would force the
creation of a new industry of people who would understand, from
a building official perspective, how to review a set of plans
for code review compliance with national and local codes. Mr.
Kito related his understanding that [the city] greatly
subsidizes the building permits that come into the office - the
fees collected don't reimburse the cost of the staff required to
do the review. Therefore, one paying for those hours on a
project would result in extra cost to the project. With respect
to the planning commission review of a project, there is
concern. Although the legislation includes an exemption for
highway and road projects, no zoning and planning review for
buildings would occur. However, the city has many requirements
for density and parking that are addressed in the planning and
zoning review, which is an area in which the city would like to
be involved.
Number 2127
REPRESENTATIVE ROKEBERG addressed Mr. Kito's last point by
saying that it wasn't his intent to take a municipality out of
the loop with regard to the planning and zoning aspects of the
building permitting process. He assured everyone that he would
work on that to ensure that municipalities will be included in
that process. With regard to the creation of a new industry,
Representative Rokeberg disagreed because there are already many
organizations that perform this [third-party review].
CHAIR MORGAN, upon determining that there was no one else who
wished to testify, closed the public testimony.
Number 2218
REPRESENTATIVE ANDERSON indicated his belief that this
legislation falls under the purview of the House Labor and
Commerce Standing Committee, which is the next committee of
referral.
REPRESENTATIVE KOOKESH commented that this committee should do
its job and do as much as possible before moving the legislation
to its next committee of referral. He announced that he would
object on the basis that he wanted to be involved in the
process.
REPRESENTATIVE ANDERSON remarked that this legislation is
important. He [as the chair of the House Labor and Commerce
Standing Committee] offered his commitment to include
Representative Kookesh during the committee's discussion of HB
264.
REPRESENTATIVE KOOKESH reiterated his belief that this committee
should do its job.
Number 2302
REPRESENTATIVE CISSNA stated her agreement with Representative
Kookesh. She assumed that HB 264 was referred to the House
Community and Regional Affairs Standing Committee because state
projects are built throughout the state in communities that vary
in regard to the local community's involvement. She asked if a
subcommittee of the House Community and Regional Affairs
Standing Committee could be created in order to address the
issues under this committee's purview.
REPRESENTATIVE WOLF said that he has no problem passing HB 264
from committee. However, he noted concern with regard to the $1
million cap, which he indicated was low. As a retired
contractor, Representative Wolf said that he has all too often
seen that city officials lack the time to perform the proper
third-party review and plan check. He mentioned that [the
third-party review and plan check] will save the state money.
CHAIR MORGAN remarked that HB 264 is a good bill, although he
said he has the same concerns as Representatives Kookesh and
Wolf. Chair Morgan said that he did believe the sponsor's
commitment to work with those interested in the matter.
Therefore, he noted that he doesn't have a problem moving HB 264
to the House Labor and Commerce Standing Committee.
Number 2480
REPRESENTATIVE ANDERSON moved to report HB 246 out of committee
with individual recommendations and the accompanying fiscal
notes.
REPRESENTATIVE KOOKESH objected.
A roll call vote was taken. Representatives Wolf, Kott,
Anderson, and Morgan voted in favor of reporting HB 246 from
committee. Representatives Cissna and Kookesh voted against
reporting it from committee. Therefore, HB 246 was reported out
of the House Community and Regional Affairs Standing Committee
by a vote of 4-2.
ADJOURNMENT
There being no further business before the committee, the House
Community and Regional Affairs Standing Committee meeting was
adjourned at 9:45 a.m.
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