Legislature(2001 - 2002)

05/02/2002 04:21 PM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                  HOUSE FINANCE COMMITTEE                                                                                       
                        May 02, 2002                                                                                            
                          4:21 PM                                                                                               
                                                                                                                                
TAPE HFC 02 - 102, Side A                                                                                                       
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Williams called the House Finance Committee meeting                                                                    
to order at 4:21 PM.                                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Eldon Mulder, Co-Chair                                                                                           
Representative Con Bunde, Vice-Chair                                                                                            
Representative John Davies                                                                                                      
Representative Richard Foster                                                                                                   
Representative John Harris                                                                                                      
Representative Bill Hudson                                                                                                      
Representative Ken Lancaster                                                                                                    
Representative Carl Moses                                                                                                       
Representative Jim Whitaker                                                                                                     
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Denny Dewitt, Staff, Representative Eldon Mulder; Wendy                                                                         
Redman, Vice President, Statewide Programs, University of                                                                       
Alaska.                                                                                                                         
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
There were no teleconference testifiers.                                                                                        
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
HB 175    "An Act making an appropriation to the Alaska                                                                         
          Industrial Development and Export Authority for                                                                       
          power projects; and providing for an effective                                                                        
          date."                                                                                                                
                                                                                                                                
          CSHB 175 (FIN) was REPORTED out of Committee with                                                                     
          a "do pass" recommendation.                                                                                           
                                                                                                                                
HB 524    "An Act relating to the issuance of general                                                                           
          obligation  bonds  for the  purpose  of paying  the                                                                   
          cost  of design, construction,  and maintenance  of                                                                   
          schools and state facilities;  and providing for an                                                                   
          effective date."                                                                                                      
                                                                                                                                
          CSHB 524 (FIN) was REPORTED out of Committee with                                                                     
          a  "do  pass"  recommendation  and  with  a  fiscal                                                                   
         impact note by the Department of Revenue.                                                                              
                                                                                                                                
HB 525    "An  Act  relating   to  the  issuance  of  general                                                                   
          obligation  bonds  for the  purpose  of paying  the                                                                   
          cost of deferred maintenance  of public facilities;                                                                   
          and providing for an effective date."                                                                                 
                                                                                                                                
          CSHB 525 (FIN) was REPORTED out of Committee with                                                                     
          a  "do  pass"  recommendation  and  with  a  fiscal                                                                   
         impact note by the Department of Revenue.                                                                              
                                                                                                                                
HB 528    "An   Act    relating   to   programs    of   state                                                                   
          reimbursement   for  debt   payments  for   certain                                                                   
          capital  projects; and  providing for an  effective                                                                   
          date."                                                                                                                
                                                                                                                                
          CSHB 528 (FIN) was REPORTED out of Committee with                                                                     
          a "do pass" recommendation.                                                                                           
                                                                                                                                
CSSB 299(FIN)                                                                                                                   
          "An Act relating to the establishment of an                                                                           
          additional south-central panel to the Alaska                                                                          
          Workers' Compensation  Board and to appointments to                                                                   
          that panel; and providing for an effective date."                                                                     
                                                                                                                                
          CSSB 299(FIN) was postponed 5/06/02.                                                                                  
                                                                                                                                
SB 345    "An Act relating to medical assistance for                                                                            
          rehabilitative services for certain children with                                                                     
          disabilities; relating to agreements to pay                                                                           
          medical assistance for covered services paid for                                                                      
          or furnished to eligible children with                                                                                
          disabilities by a school district; and providing                                                                      
          for an effective date."                                                                                               
                                                                                                                                
          SB 345 was postponed to 5/6/02.                                                                                       
HOUSE BILL NO. 175                                                                                                            
                                                                                                                                
     "An Act making an appropriation to the Alaska                                                                              
     Industrial Development and Export Authority for power                                                                      
     projects; and providing for an effective date."                                                                            
                                                                                                                                
Co-Chair  Mulder noted  that Amendment  1, 22-LS0705\X.9  was                                                                   
adopted on 4/30/02.                                                                                                             
                                                                                                                                
Representative Lancaster  MOVED to report CSHB  175 (FIN) out                                                                   
of Committee with  the accompanying fiscal note.  There being                                                                   
NO OBJECTION, it was so ordered.                                                                                                
                                                                                                                                
CSHB  175 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation.                                                                                                           
HOUSE BILL NO. 524                                                                                                            
                                                                                                                                
     "An Act relating  to the issuance of  general obligation                                                                   
     bonds  for the  purpose of  paying the  cost of  design,                                                                   
     construction,  and  maintenance  of  schools  and  state                                                                   
     facilities; and providing for an effective date."                                                                          
                                                                                                                                
Co-Chair  Mulder  provided members  with  proposed  committee                                                                   
substitute,  work draft  22-LS1725\F, dated  5/2/02 (copy  on                                                                   
file).                                                                                                                          
                                                                                                                                
Co-Chair  Williams MOVED  to  ADOPT work  draft  22-LS1725\F,                                                                   
dated 5/2/02. There being NO OBJECTION, it was so ordered.                                                                      
                                                                                                                                
Co-Chair Mulder  reviewed the committee substitute  and noted                                                                   
that duplicative  projects in  the Fairbanks School  District                                                                   
were  deleted  from the  deferred  maintenance  component.  A                                                                   
central  kitchen/operations   and  maintenance   facility  in                                                                   
Fairbanks and  a nutrition services  facility in  Mat-Su were                                                                   
added.                                                                                                                          
                                                                                                                                
DENNY DEWITT,  STAFF, REPRESENTATIVE  ELDON MULDER  explained                                                                   
that  there  were  two technical  changes  corrected  in  the                                                                   
committee substitute.  Bartlett High School was  listed in at                                                                   
$19 million  dollars, which was  an error and was  changed to                                                                   
$1.9 million  dollars. Chugiak  High School was  corrected to                                                                   
show the state  share of $3,655,728 dollars  (the local share                                                                   
had been listed).                                                                                                               
                                                                                                                                
Representative  Hudson  questioned  if overall  education  GO                                                                   
bonds  were expanded.  Representative  Mulder explained  that                                                                   
the Fairbanks central kitchen  project was a substitution for                                                                   
another  project  that  was already  authorized.  The  Mat-Su                                                                   
project  would  require additional  bonding.  He  anticipated                                                                   
that the  Mat-Su project would  have been added in  the other                                                                   
body.                                                                                                                           
                                                                                                                                
Representative Foster  MOVED to report CSHB 525  (FIN) out of                                                                   
Committee with  the accompanying fiscal note.  There being NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
CSHB  524 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation  and with  a fiscal  impact note  by the                                                                   
Department of Revenue.                                                                                                          
HOUSE BILL NO. 525                                                                                                            
                                                                                                                                
     "An Act relating  to the issuance of  general obligation                                                                   
     bonds  for the purpose  of paying  the cost of  deferred                                                                   
     maintenance of  public facilities; and providing  for an                                                                   
     effective date."                                                                                                           
                                                                                                                                
Co-Chair  Mulder  provided members  with  proposed  committee                                                                   
substitute,  work draft  22-LS1735\F, dated  5/2/02 (copy  on                                                                   
file).  He noted  that there  are  many deferred  maintenance                                                                   
needs throughout  the state  that need  to be addressed.  The                                                                   
legislation  attempts  to  address  these  needs.  The  total                                                                   
amount  is  $199,317,717  dollars.  There  is:  $113  million                                                                   
dollars   for  schools,   $5.56  million   dollars  for   the                                                                   
university,  $31,887,500  for docks  and  harbors, and  $48.5                                                                   
million  dollars  for  state  facilities.  He  observed  that                                                                   
duplicative funds,  which will receive federal  funding, were                                                                   
removed.  This made  room for  deferred maintenance  projects                                                                   
for  schools in  Yukon-Koyukuk, Dillingham  City, and  Hoonah                                                                   
City.                                                                                                                           
                                                                                                                                
Co-Chair  Williams MOVED  to  ADOPT work  draft  22-LS1735\F,                                                                   
dated 5/2/02. There being NO OBJECTION, it was so ordered.                                                                      
                                                                                                                                
Representative Hudson  MOVED to report CSHB 525  (FIN) out of                                                                   
Committee with  the accompanying fiscal note.  There being NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
CSHB  525 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation  and with  a fiscal  impact note  by the                                                                   
Department of Revenue.                                                                                                          
HOUSE BILL NO. 528                                                                                                            
                                                                                                                                
     "An Act relating to programs of state reimbursement for                                                                    
     debt payments for certain capital projects; and                                                                            
     providing for an effective date."                                                                                          
                                                                                                                                
Co-Chair  Mulder  provided members  with  proposed  committee                                                                   
substitute,  work draft  22-LS1742\P, dated  5/2/02 (copy  on                                                                   
file).                                                                                                                          
                                                                                                                                
Co-Chair  Williams MOVED  to  ADOPT work  draft  22-LS1742\P,                                                                   
dated 5/2/02. There being NO OBJECTION, it was so ordered.                                                                      
                                                                                                                                
Co-Chair Mulder explained that  funding for the Juneau museum                                                                   
project was  not included because preliminary  planning (land                                                                   
purchase and design) cannot be bonded.                                                                                          
                                                                                                                                
Representative Hudson  noted that the Juneau  Joint Readiness                                                                   
Center project  had not been  included in any  legislation to                                                                   
date. The  project would involve  the Department  of Military                                                                   
and   Veterans  Affairs   and  the   University  of   Alaska,                                                                   
Southeast. He  emphasized the  importance of the  project and                                                                   
noted that  the Armory  needs to  be relocated. Some  federal                                                                   
funds  have been  appropriated,  but the  project needs  $5.4                                                                   
million   dollars.  This   is  the   number  one   long-range                                                                   
construction  priority of  the  Army National  Guard and  the                                                                   
University  of Alaska, Southeast.  Co-Chair Mulder  expressed                                                                   
sympathy for  the project, but  emphasized the need  to "hold                                                                   
the lid on the bond package".                                                                                                   
                                                                                                                                
Co-Chair  Mulder  explained  that the  Metlakatla  light  and                                                                   
power  project  was  included   in  order  to  protect  their                                                                   
solvency. If  the project were  to go into receivership  they                                                                   
would  not be  eligible  for  other federal  assistance.  The                                                                   
appropriation would  not cover the full cost  of the project,                                                                   
but  it  would  provide  enough   assistance  to  meet  their                                                                   
obligation.  The  university indicated  that  the  university                                                                   
center could  be done through the reimbursement  methodology,                                                                   
which reduced the need on the capital budget.                                                                                   
                                                                                                                                
Representative  Davies  noted  that  the  $2  million  dollar                                                                   
project for the  Fairbanks campus needs to  occur this summer                                                                   
and asked  if it were  possible to place  the project  in the                                                                   
regular  capital budget  in order  to  meet the  construction                                                                   
schedule.  Co-Chair  Mulder  indicated   that  he  would  not                                                                   
object,  but emphasized  his concern with  moving items  from                                                                   
the deferred maintenance bond legislation.                                                                                      
                                                                                                                                
Representative  Carl  Moses MOVED  to  ADOPT AMEND:  page  4,                                                                   
line 21:  delete "Lake and  Peninsula" and insert  "Aleutians                                                                   
East". There being NO OBJECTION, it was so ordered.                                                                             
                                                                                                                                
Representative  Hudson reiterated his  desire to  see funding                                                                   
for the Juneau Readiness Center.                                                                                                
                                                                                                                                
WENDY REDMAN, VICE PRESIDENT,  STATEWIDE PROGRAMS, UNIVERSITY                                                                   
OF ALASKA  explained that  the university's bonding  capacity                                                                   
would  be used  to secure  funding for  the Juneau  Readiness                                                                   
Center. The  debt service  would be paid  by the  state under                                                                   
the debt  service account.  She felt  that the project  would                                                                   
fit  under  the  educational   requirements  for  bonding  or                                                                   
borrowing  capacity.  She  expressed some  concern  that  the                                                                   
University's bonding capacity  is limited to projects that do                                                                   
not exceed a  million dollars in debt service.  She felt that                                                                   
an adjustment  would needed in  statutory language  to adjust                                                                   
the limit.                                                                                                                      
                                                                                                                                
Representative Hudson  MOVED to ADOPT $5,470  million dollars                                                                   
for the  Juneau Readiness Center.  There being  NO OBJECTION,                                                                   
it was so ordered.                                                                                                              
                                                                                                                                
Representative  John Davies  MOVED to  report CSHB 528  (FIN)                                                                   
out of  Committee with  the accompanying  fiscal note.  There                                                                   
being NO OBJECTION, it was so ordered.                                                                                          
                                                                                                                                
CSHB  528 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation.                                                                                                           
HOUSE BILL NO. 524                                                                                                            
                                                                                                                                
     "An Act relating to the issuance of general obligation                                                                     
     bonds for the purpose of paying the cost of design,                                                                        
     construction, and maintenance of schools and state                                                                         
     facilities; and providing for an effective date."                                                                          
                                                                                                                                
Co-Chair Mulder  explained that a technical amendment  to the                                                                   
Department    of   Community    and   Economic    Development                                                                   
appropriation  was  needed  to add  "under  37.05.315"  after                                                                   
"grant" on line 27, page 3.                                                                                                     
                                                                                                                                
Co-Chair Mulder  MOVED to RESCIND  the Committee's  action in                                                                   
passing CSHB 524  (FIN) from Committee for the  purpose of an                                                                   
amendment. There being NO OBJECTION, it was so ordered.                                                                         
                                                                                                                                
Co-Chair  Mulder  MOVED  to  ADOPT  "under  37.05.315"  after                                                                   
"grant" on line 27, page 3. There  being NO OBJECTION, it was                                                                   
so ordered.                                                                                                                     
                                                                                                                                
Vice-Chair  Bunde  MOVED to  report  CSHB  524 (FIN)  out  of                                                                   
Committee with  the accompanying fiscal note.  There being NO                                                                   
OBJECTION, it was so ordered.                                                                                                   
                                                                                                                                
CSHB  524 (FIN)  was REPORTED  out  of Committee  with a  "do                                                                   
pass" recommendation.                                                                                                           
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 4:52 PM                                                                                            
                                                                                                                                

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