Legislature(2017 - 2018)BARNES 124
04/11/2018 01:00 PM House RESOURCES
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| Audio | Topic |
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| Presentation(s): Department of Natural Resources | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
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ALASKA STATE LEGISLATURE
HOUSE RESOURCES STANDING COMMITTEE
April 11, 2018
2:19 p.m.
MEMBERS PRESENT
Representative Andy Josephson, Co-Chair
Representative Geran Tarr, Co-Chair
Representative John Lincoln, Vice Chair
Representative Harriet Drummond
Representative Justin Parish
Representative Chris Birch
Representative George Rauscher
Representative David Talerico
MEMBERS ABSENT
Representative DeLena Johnson
Representative Mike Chenault (alternate)
Representative Chris Tuck (alternate)
COMMITTEE CALENDAR
PRESENTATION(S): DEPARTMENT OF NATURAL RESOURCES
- HEARD
PREVIOUS COMMITTEE ACTION
No previous action to record
WITNESS REGISTER
ANDY MACK, Commissioner
Department of Natural Resources
Anchorage, Alaska
POSITION STATEMENT: Provided a PowerPoint presentation
entitled, "ASTAR Project Update" dated 4/11/18.
JENN ADLEMAN, Project Coordinator
Office of Project Management and Permitting
Department of Natural Resources
Anchorage, Alaska
POSITION STATEMENT: Answered a question during the update on
the Arctic Strategic Transportation and Resources project.
LOIS EPSTEIN, Arctic Project Director
The Wilderness Society
Anchorage, Alaska
POSITION STATEMENT: Testified during the update on the Arctic
Strategic Transportation and Resources project.
ACTION NARRATIVE
2:19:11 PM
CO-CHAIR ANDY JOSEPHSON called the House Resources Standing
Committee meeting to order at 2:19 p.m. Representatives
Josephson, Talerico, Lincoln, Parish, and Birch were present at
the call to order. Representatives Rauscher, Drummond, and Tarr
arrived as the meeting was in progress.
^PRESENTATION(S): Department of Natural Resources
PRESENTATION(S): Department of Natural Resources
2:19:40 PM
CO-CHAIR JOSEPHSON announced that the first order of business
would be an update by the Department of Natural Resources (DNR)
on the Arctic Strategic Transportation and Resources (ASTAR)
project.
2:20:21 PM
ANDY MACK, Commissioner, DNR, informed the committee the ASTAR
project began in 2016 when Governor Walker met with leaders from
the North Slope region and discussed how changing ice conditions
affect communities and industry that rely upon ice for
transportation purposes in winter. He stated the safe use of
ice and snowpack roads is now limited to early January until
mid-April. Due to this situation, the administration, in
partnership with regional entities, tasked DNR to enhance and
protect affected communities' road systems and maintain state
access to state land in the Colville River Delta and the
National Petroleum Reserve-Alaska (NPR-A) on a year-round basis
in the future. Commissioner Mack stressed transportation on a
year-round around basis in this region is of particular interest
to younger residents. Therefore, DNR obtained an appropriation
of $7.3 million which was used to update existing agreements
with the North Slope Borough and to execute a separate agreement
defining the ASTAR project (slide 2).
COMMISSIONER MACK said the lead agency for the ASTAR project is
the Office of Project Management and Permitting (OPMP), and
there will be additional participation by the Division of
Mining, Land and Water, the Division of Support Services, the
Division of State Parks and Outdoor Recreation, the Division of
Geological and Geophysical Surveys (DGGS), and the Division of
Oil and Gas. He pointed out the original request for the
project in 2016 was for a year-round road from the Colville
River Delta to [Utqiagvik]; however, ASTAR has been expanded to
include providing infrastructure in the Arctic National Wildlife
Refuge (ANWR) 1002 Area. Additionally, the Department of Health
and Social Services will provide a health analysis, the
Department of Commerce, Community & Economic Development will
provide a resiliency and adaptation study and training, and the
Department of Transportation & Public Facilities (DOTPF) will
provide planning guidelines from the Northwest Alaska
Transportation Plan (slide 3).
2:29:39 PM
COMMISSIONER MACK explained DOTPF has many transportation
projects underway; however, ASTAR is not part of a Statewide
Transportation Improvement Program (STIP) and thus is not part
of a federal planning process at this time, although that is
DNR's goal. He stressed Alaska has not built a major new
infrastructure project in rural Alaska for many years and ASTAR
is focused on the North Slope region, which continues to provide
substantial income from state resources; also, the North Slope
contains large federally-controlled areas such as NPR-A and
ANWR, therefore, Commissioner Mack cautioned that the state
needs to provide a consistent vision with its regional partners
to avoid challenges from federal agencies.
2:33:38 PM
REPRESENTATIVE PARISH asked:
Under the decreased rehabilitation costs for the NPR-A
legacy wells [a desired outcome listed on upcoming
slide 4], is it correct that at present the federal
government would, would bear those costs and benefit
from that reduction?
COMMISSIONER MACK said yes and explained a challenge with the
NPR-A legacy well program is that a large portion of the federal
funds appropriated would be spent getting access to the wells;
however, [because the ASTAR project would provide less expensive
access] the state would ensure the appropriated money is used to
plug and abandon wells.
REPRESENTATIVE PARISH questioned whether DNR could achieve a
federal match for any portion of the project.
2:35:24 PM
COMMISSIONER MACK expressed DNR's opinion the legacy [well
rehabilitation] program is an obligation of the federal
government. He remarked:
With respect to year-round roads, in particular a
year-round road where folks in the community of
[Utqiagvik] can enjoy that year around access, we
would expect that a ... element of the funding would
be ... something that's a little bit more traditional,
potentially more traditional, and like a [U.S.
Department of Transportation (USDOT)] funded project,
construction of which is largely, you know, the large
contribution comes from the federal government ....
COMMISSIONER MACK directed attention to slide 4 which listed the
following desired outcomes:
• Increased cultural connectivity
• Reduction in cost of living in area communities
• More efficient development of natural resources
• Increased economic activity providing job
opportunities for the region
• Decreased rehabilitation costs for NPR-A legacy
wells
COMMISSIONER MACK said the [ASTAR project] would proceed in
partnership with the region's communities for the shared benefit
of both the communities and the state by maximizing natural
resource development; however, DNR will ensure its vision is
shared with affected communities. Commissioner Mack advised the
ASTAR project encompasses large areas of federal and private
lands thus the project is being planned regionally, with less
regard for land ownership, and crosses many land management
jurisdictions. Also shown on slide 4 are deliverables including
a strategic plan and a cumulative benefits analysis tool. He
explained federal planning on the North Slope reflects
cumulative impacts of development, which undervalues the
benefits of development. However, the state, while
understanding impacts, also reports cumulative benefits that
must be taken into account when the state seeks to fill wetlands
with gravel; in fact, DNR will fully evaluate the benefits of
projects across the state.
2:40:54 PM
REPRESENTATIVE BIRCH observed ASTAR has garnered a high level of
support from the affected communities.
2:41:44 PM
REPRESENTATIVE PARISH pointed out the project has support from
the North Slope Borough and asked whether other communities
within the affected area have offered support or opposition.
COMMISSIONER MACK answered the North Slope Borough is a true
partner in the project and has developed a plan focused on the
infrastructure needs of [Utqiagvik] and seven North Slope
villages; he surmised most of the villages seek long-term year-
round transportation options and development, such as road
access for Anaktuvuk Pass, and marine or other facilities for
Kaktovik, Nuiqsut, Wainwright, and others. He said no one has
expressed opposition.
2:45:38 PM
COMMISSIONER MACK directed attention to a conceptual map on
slide 5 which indicated existing year-round infrastructure and
potential transportation utility corridors. He turned to slide
6 and recalled after receiving funding last year DNR began work
with the North Slope Borough on an ASTAR proof of concept
project that entailed getting a permit for a community winter
access trail. The project is a hardened packed trail that would
demonstrate how a year-round road system on the tundra would
operate. The permit was issued by the Bureau of Land Management
(BLM), U.S. Department of the Interior, to the North Slope
Borough, and a snowpack road was built from the existing road
south to Nuiqsut and on to [Utqiagvik]. The road is now being
used by residents for transportation from [Utqiagvik] to
Deadhorse and south. Further, the road will be used by
contractors of [Parcel Post mail in the bypass mail process] in
order to understand and measure the impacts and benefits of
commercial transportation systems.
2:50:09 PM
REPRESENTATIVE PARISH asked how improved snow trails are built
and what type of traffic they can support.
COMMISSIONER MACK deferred to Jenn Adleman.
2:50:50 PM
JENN ADLEMAN, Project Coordinator, Office of Project Management
and Permitting, DNR, informed the committee snow trails are
repeatedly built up from snow by equipment as the snow is packed
down and more is added; as the trails are used by vehicles, the
snow is continually packed down. Further, maintenance vehicles
travel with caravans of vehicles and trucks to maintain the
trails, and over time, constant use improves the trail.
2:52:34 PM
COMMISSIONER MACK directed attention to slide 7, noting ASTAR
2018 work highlights include hiring Alaska-based contractors to
provide the tasks listed on slide 7. This work informs
infrastructure project cost comparisons and analyses to
understand future funding sources for the project in light of
the state's fiscal climate. He suggested one possible funding
source for construction is bonding through the North Slope
Borough's North Slope Port Authority, or federal funding from
USDOT. At this time, DNR has issued contracts for the
aforementioned tasks with Arctic Slope Regional Corporation
(ASRC) Energy Services (AES), and Resource Data, Inc., and work
is underway. He directed attention to slide 8 which provided
information on a construction materials survey which will be
conducted by DGGS; also underway is 2018 field work which may
continue into the 2019 summer season. He closed with slide 9
which illustrated the ASTAR project budget from fiscal year 2018
(FY 18) through FY 20 and offered to answer questions on budget
items for committee members following the meeting.
2:56:31 PM
REPRESENTATIVE BIRCH expressed support for the project and
pointed out the cost of an ice road is estimated at $400,000 per
mile; however, estimates for the Ambler Access project estimated
the cost of an ice road at $300,000 per mile. He asked whether
the materials for the ASTAR project are state-owned.
COMMISSIONER MACK answered DNR will look at all material sites,
including sites owned by the state, the North Slope Borough, and
ASRC; in fact, the project may require sites on land owned by
the state, Alaska Native corporations, and BLM, and materials
may also be sourced from allotments.
2:58:47 PM
LOIS EPSTEIN, Arctic Project Director, The Wilderness Society,
paraphrased from her written statement, which read [original
punctuation provided]:
Thank you very much to the co-chairs and members of
the House Resources Committee for holding this hearing
especially during this busy time on the Arctic
Strategic Transportation and Resources project, or
ASTAR. You probably know that the legislature provided
over $7.3 million for ASTAR in the 2018 capital budget
following a May request from DNR, unfortunately
without holding a single hearing on the project. My
goal today is to explain the problems with this
project so the legislature can consider re-
appropriating some of ASTAR's unrestricted funds for
more valuable purposes.
As background, I am an Alaska-licensed engineer and
Arctic Program Director for The Wilderness Society. In
the past, I developed reports, testimony and comments
opposed to for financial and other reasons the
now-cancelled Juneau and Gravina Access projects, the
Knik Arm Bridge project, the road to Nome and the road
to Umiat. The state spent tens of millions of dollars
on each of these projects for planning, not
construction, while at the same time the state
underfunded existing road, bridge, and ferry
maintenance and upgrade needs.
I'd be happy to provide the committee with information
on some major road and ferry projects that I, as the
former head of the statewide non-profit Alaska
Transportation Priorities Project, have not opposed.
Community residents that attended hundreds if not
thousands of hours in meetings and wrote comments in
support of these proposed projects were disappointed
to learn that the state could not construct these now-
cancelled roads and bridges due to our limited
financial resources.
3:00:46 PM
MS. EPSTEIN continued:
Legislative committees also spent hundreds of member
hours analyzing these projects and appropriating money
for planning purposes only to learn later that the
state could not support the more expensive portion of
these projects?construction.
Given the state's financial situation, it is a mystery
to me why the legislature in 2017 approved an
appropriation for ASTAR which starts this new
megaproject in the very same capital budget that shut
down the unaffordable Knik Arm Bridge and Juneau
Access megaprojects. I fear that residents of the
North Slope are being misled into thinking that ASTAR
will actually construct gravel roads rather than just
spend money to plan them.
How did the proposed road to Nome, for example, work
out? A state-funded analysis issued in 2010 projected
that the road would cost a whopping $2.3-2.7 billion,
an amount too high to justify lowered costs for
purchases in currently roadless communities. Rather
than cancel the project following that report, Gov.
Parnell's spokesperson misleadingly told the Anchorage
Daily News that, "it's too soon to say how the actual
construction would be financed, and if private money
might be involved." That is very similar to what DNR
Commissioner Mack told the Alaska Journal of Commerce
this past September: "Mack acknowledged $7.3 million
doesn't build much on the Slope and said that money
will be used to plan projects and hopefully devise a
payment structure for what might actually be built,
which he also said almost certainly won't come close
to the entire network."
When a public meeting on the road to Nome was held in
Anchorage, the participants were very concerned that
the road's extremely high cost would take money away
from transportation needs in the Anchorage region.
Finally, in November 2013, the state cancelled the
road to Nome.
How will the ASTAR project likely play out? Probably
much the same way. The ASTAR team will hold meetings
with Arctic residents and possibly others throughout
the state to assess public support. Some Arctic
residents might like the idea of roads, while others
will oppose them because of potential negative effects
on subsistence including from non-residents who may
come to hunt. Non-Arctic residents will be concerned
that ASTAR will take money away from local
transportation needs.
3:03:01 PM
MS. EPSTEIN continued:
ASTAR staff and consultants, paid for by the $7.3
million appropriation, will estimate the road network
cost. According to a February 21, 2018 letter from
DNR's Heidi Hansen to Senator Giessel, gravel roads
would cost $1-2 million per mile, with recent Arctic
roads costing approximately $2 million per mile. The
state likely will tell reporters that it does not yet
know how it will finance these roads and will add that
private money from tolls may be involved; toll money
can help finance maintenance but generally is not
enough to fund road construction. As Commissioner Mack
told the Alaska Journal of Commerce, "Part of the
project is to understand and examine the financial
opportunities and one of the opportunities may be a
tolling structure and how that might work."
A few years from now, after spending millions or
possibly tens of millions of dollars if the
legislature appropriates more money, the state will
discover that the cost of ASTAR is unaffordable and
the proposed project will be canceled. Arctic
residents who have gotten their hopes up for year-
round roads to connect them to other communities will
be greatly disappointed.
So what key questions should the legislature and the
Walker administration consider at this time? With due
respect to Commissioner Mack, DNR has not provided
strong answers to two key concerns:
1. What is the need for year-round roads on the North
Slope, which will be tremendously expensive, when much
of the cost savings to communities can be achieved
with low cost snow roads? And,
2. The ASTAR project will be in competition for
dollars with fixing roads and bridges and ferries in
more populated areas like Anchorage, Wasilla,
Fairbanks, and Juneau. This project should be part of
the state's Long Range Transportation Plan. When we're
talking about using state dollars, the decisions
should be made with statewide input.
Thank you for your attention to this testimony. Please
let me know if I can provide any additional
information or answer any questions.
3:05:25 PM
CO-CHAIR JOSEPHSON remarked:
... I share some of your concerns for sure. There was
nothing I heard in today's testimony, however, that
made any promises or assurances. Do you agree with
that?
MS. EPSTEIN explained there has been a history of planning and
permitting for major road and transportation projects; because
millions of dollars are spent, the public has "an expectation
that things are going to happen, and we've seen it with the Knik
Arm Bridge. Even though the, both the governor and the
legislature have canceled that project, there are still members
of the public and others who are very interested in continuing
to pursue that despite the fiscal realities of the state."
REPRESENTATIVE BIRCH asked Ms. Epstein whether she would support
the project if it were privately constructed at no cost to the
state.
MS. EPSTEIN said her support would depend on the road
construction details of the plan.
REPRESENTATIVE BIRCH observed the Dalton Highway was constructed
privately as a support road during construction of the Trans-
Alaska Pipeline System (TAPS) and is now a public road providing
access to Utqiagvik. He urged witnesses to consider the
benefits, offsets, and positive aspects of surface
transportation, and opportunities that may be provided by
private initiative.
3:08:23 PM
REPRESENTATIVE TALERICO described the [Roads to Resources - Road
to Tanana] project. He referred to Ms. Epstein's
characterization of the road as a "primitive road." He asked:
Is that, was that an official classification, that
that was a primitive road, [because] there's a portion
of that road that goes through corporation land which
was off limits, you know, until they had approval for
it ... I'm not too sure about the primitive road
designation from, say, Tofty out to the Tanana River.
... Or was that more just, just based off a couple of
the different routes that people had had?
3:08:49 PM
MS. EPSTEIN expressed her understanding the work was an upgrade
of an existing route that "some" have characterized as a
primitive road. She added:
... the point I was making was the lower cost to build
that road - which did come in less than was predicted
- was in part a result of there being a, a route in
some fashion along that ... in that area that was
existing. So, that's very different than an Ambler
road where it's basically more or less a greenfield
road, and some of these roads would be that way as
well, although the conditions on the North Slope are,
of course, flatter, so that would make it cheaper than
Ambler.
3:10:20 PM
ADJOURNMENT
There being no further business before the committee, the House
Resources Standing Committee meeting was adjourned at 3:10 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| ASTAR__DNR_PPT.pdf |
HRES 4/11/2018 1:00:00 PM |
ASTAR |
| ASTAR 2017 funding request 2 HFIN_SB23.pdf |
HRES 4/11/2018 1:00:00 PM |
SB 23 |
| ASTAR SRES Questions 2.9.18.pdf |
HRES 4/11/2018 1:00:00 PM |
|
| ADN Snow Road Article 3.16.18.pdf |
HRES 4/11/2018 1:00:00 PM |
|
| ASTAR TWS Testimony.docx |
HRES 4/11/2018 1:00:00 PM |
ASTAR |