Legislature(1997 - 1998)
03/10/1997 01:30 PM House TRA
| Audio | Topic |
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE TRANSPORTATION STANDING COMMITTEE
March 10, 1997
1:30 p.m.
MEMBERS PRESENT
Representative Bill Williams, Chairman
Representative Beverly Masek, Vice Chairman
Representative John Cowdery
Representative Bill Hudson
Representative Jerry Sanders
Representative Kim Elton
Representative Al Kookesh
MEMBERS ABSENT
All members present
COMMITTEE CALENDAR
*HOUSE JOINT RESOLUTION NO. 27
Requesting the Federal Aviation Administration to grant exemptions
from the "commuter rule" in order to maintain a high level of air
safety and air transportation service in rural Alaska.
- MOVED HJR 27 OUT OF COMMITTEE
*HOUSE BILL NO. 85
"An Act giving notice of and approving a lease-purchase agreement
with the City of Soldotna for a maintenance facility of the
Department of Transportation and Public Facilities."
- MOVED CSHB 85(TRA) OUT OF COMMITTEE
(* First public hearing)
PREVIOUS ACTION
BILL: HJR 27
SHORT TITLE: FAA "COMMUTER RULE"
SPONSOR(S): REPRESENTATIVE(S) IVAN, Foster
JRN-DATE JRN-PG ACTION
03/05/97 539 (H) READ THE FIRST TIME - REFERRAL(S)
03/05/97 539 (H) TRANSPORTATION
03/10/97 (H) TRA AT 1:00 PM CAPITOL 17
03/10/97 616 (H) COSPONSOR(S): FOSTER
BILL: HB 85
SHORT TITLE: DOT MAINTENANCE FACILITY AT SOLDOTNA
SPONSOR(S): REPRESENTATIVE(S) DAVIS
JRN-DATE JRN-PG ACTION
01/24/97 136 (H) READ THE FIRST TIME - REFERRAL(S)
01/24/97 137 (H) TRANSPORTATION, FINANCE
03/10/97 (H) TRA AT 1:00 PM CAPITOL 17
WITNESS REGISTER
REPRESENTATIVE IVAN IVAN
Alaska State Legislature
Capitol Building, Room 418
Juneau, Alaska 99801
Telephone: (907) 465-4952
POSITION STATEMENT: Provided sponsor statement on HJR 27.
REPRESENTATIVE RICHARD FOSTER
Alaska State Legislature
Capitol Building, Room 410
Juneau, Alaska 99801
Telephone: (907) 465-3789
POSITION STATEMENT: Testified in support of HJR 27.
JOHN KRUSE
Cape Smythe Air Service
P.O. Box 549
Barrow, Alaska 99723
Telephone: (907) 852-8333
POSITION STATEMENT: Testified on HJR 27.
JOHN HAJDUKOVICH, owner
Frontier Flying Service
3820 University Avenue
Fairbanks, Alaska 99709
Telephone: (907) 474-0024
POSITION STATEMENT: Testified in support of HJR 27.
KIM ROSS, Executive Director
Alaska Aircraft Carriers Association
1117 East 55th Street, Suite 102
Anchorage, Alaska 99508
Telephone: (907) 277-0071
POSITION STATEMENT: Testified in support of HJR 27.
JOSEPH SPRAGUE, Director of Marketing
ERA Aviation
6160 Carl Brady Drive
Anchorage, Alaska 99502
Telephone: (907) 266-8393
POSITION STATEMENT: Testified on HJR 27.
REPRESENTATIVE GARY DAVIS
Alaska State Legislature
Capitol Building, Room 513
Juneau, Alaska 99801
Telephone: (907) 465-2693
POSITION STATEMENT: Provided sponsor testimony on HB 85.
LISA PARKER, Planning Director
Kenai Peninsular Borough
144 North Binkley
Soldotna, Alaska 99669
Telephone: (907) 262-4441
POSITION STATEMENT: Testified in support of HB 85.
TOM BOEDEKER, City Manager
City of Soldotna
177 North Birch Street
Soldotna, Alaska 99669
Telephone: (907) 262-9107
POSITION STATEMENT: Testified in support of HB 85
ACTION NARRATIVE
TAPE 97-14, SIDE A
Number 001
CHAIRMAN BILL WILLIAMS called the House Transportation Standing
Committee to order at 1:30 p.m. Members present at the call to
order were Representatives Williams, Masek, Cowdery, Hudson,
Sanders, Elton and Kookesh.
HJR 27 - FAA "COMMUTER RULE"
Number 027
CHAIRMAN WILLIAMS stated that the first order of business is HOUSE
JOINT RESOLUTION NO. 27 "Requesting the Federal Aviation
Administration to grant exemptions from the 'commuter rule' in
order to maintain a high level of air safety and air transportation
service in rural Alaska." He stated that Representative Ivan will
provide sponsor testimony on HJR 27.
Number 130
REPRESENTATIVE IVAN IVAN stated that HJR 27 will have a great
impact on the economy and the travel service provided by commercial
airlines. He read the Sponsor Statement into the record:
"House Joint Resolution 27 proposes that the Federal Aviation
Administration (FAA) grant specific petitions for exemption from
individual operators affected by the 'Commuter Rule.' An exemption
would ensure that safety is not diminished because the aircraft
currently utilized, the Twin Otter, has a good safety record based
on statistics on aircraft accidents in Alaska.
"The Commuter Rule applies to any aircraft capable of carrying ten
or more passengers under Part 121 of the FAA rules which applies to
major operators as United Airlines, Alaska Airlines and any other
major operators in the nation. Twin Otters currently operate under
Part 135 of the FAA rules which apply to small aircraft. The
Commuter Rule will come into effect, this month, March 20, 1997.
"Rural Alaska relies totally on air transportation for passenger
travel and moving goods and services. The aircraft affected by the
Commuter Rule is the Twin Otter which carries 10 to 19 passengers
and has twin-engine with turbo-props. This aircraft has a larger
load capacity than a Cessna 206 or 207 and has a comparable
approach speed. The Twin Otter also has a better safety record
than those of smaller aircraft. There were a total of 67 accidents
in 1995/1996 and seven of those occurred in ten plus seat aircraft.
"The FAA has been given specific authority by Congress to provide
exemptions to small air carriers in Alaska from provisions of the
Commuter Rule. This resolution is requesting just that."
Number 324
REPRESENTATIVE IVAN stated that the Commuter Rule is prompted by
commuter aircraft accidents throughout the lower 48.
Number 370
REPRESENTATIVE RICHARD FOSTER stated that he ran a commuter for 20
years and over the years Senator Stevens has been able to get
various exemptions for Alaska because of the uniqueness and
difficulty of maintaining business here. He stated that the Twin
Otter is used on a lot of short runs in rural Alaska. He stated
that one of the provisions of the Commuter Rule is that there needs
to be a stewardess on board any aircraft with more that nine
passengers on it. Having a stewardess on bush runs into the arctic
makes it very expensive. He stated that ERA Aviation has indicated
that they would withdraw from the market and ERA Aviation is, in
some villages, the only aircraft that flies to certain villages.
He stated that it would be very difficult to comply to the new
ruling. He stated that he is in support of HJR 27.
Number 500
REPRESENTATIVE KIM ELTON stated that he supports the resolution but
he thought David Hinson was no longer the administrator for the
FAA.
Number 527
REPRESENTATIVE IVAN stated that they were working with the latest
information and if updates are necessary, it will be changed on the
House Floor.
Number 536
REPRESENTATIVE BILL HUDSON asked what the timing is of the proposed
changeover by the FAA.
Number 552
REPRESENTATIVE IVAN responded that they are eminent and he believed
the target date to be March 20, 1997. He stated that some of the
airlines are already reacting to it. The existing airlines that
are continuing to use the Twin Otters are going to take out some of
the seats and operate under the previous rule that has been in
operation.
Number 591
REPRESENTATIVE FOSTER stated that it is compounded by the fact that
there are not too many Twin Otters left, and they have got the
Medivac contract for Bethel, so by pulling out of the market, they
would have to be replaced by another aircraft which would result in
a costly process to convert them into air ambulances.
Number 633
REPRESENTATIVE JOHN COWDERY asked what would be a typical run if
the aircraft was based in Bethel.
Number 661
REPRESENTATIVE IVAN replied the area is the size of the state of
Oklahoma, making milk run stops in 150 mile one-way routes.
Number 742
REPRESENTATIVE COWDERY stated by eliminating one passenger it would
give the opportunity for more fuel on board and asked if
Representative Foster could comment on that.
Number 770
REPRESENTATIVE FOSTER replied that the biggest problem is the
change of record keeping for maintenance. He would foresee that
the airlines would have to hire a complete new staff to conform
because the regulations of the large commuters all conform to major
airline maintenance and administrative record keeping. He stated
that he could not see how an operator in a village could conform
financially. It would force the bush operators to sell their
equipment and go back to the single engine planes. He stated this
would affect safety and the ability to get Medivac aircraft. He
stated that he did not see how Alaska would have the financial
ability to conform.
Number 855
REPRESENTATIVE COWDERY stated that the probable cost to fly would
increase.
Number 878
JOHN KRUSE, Cape Smythe Air Service, testified via teleconference
from Barrow, that their main base is located in Barrow. He stated
that Mr. Hinson was replaced by Guy Gardner. He stated that Cape
Smythe Air Service sold their Twin Otters in 1996 because they did
not feel, with the Commuter Rule, it would be worthwhile to equip
them with the necessary equipment. He stated that they have for
sale their three beechcraft planes, which are 15 passenger
aircraft, because this aircraft reduced to nine passengers will not
compete with other piston aircraft. He stated that the Commuter
Rule is requiring better communications and dispatchers that would
cost around 50,000 a year, in addition to the $15,000 training
program for each dispatcher. He stated that there are a lot of
requirements that are not going to be able to be met by the
operator. He said, "we also have better or more weather
requirements which has been taken care of by less and less weather
reporting. We have a lack of instrument approach which means, how
are we going to go to these places without instrument approaches.
This could be done by using GPS when approved by the FAA, the
target date is the year 2005." He stated that these are a lot of
things that almost can't be done by the operator, at least not
economically. He stated that if this rule comes into being, they
are going to go back to the Cessna 206 and 207 aircraft. He stated
that the Commuter Rule is prohibitive to most operators.
Number 1130
REPRESENTATIVE BEVERLY MASEK asked if besides Cape Smythe how many
other airlines are in Barrow.
Number 1146
MR. KRUSE replied that there are two other operators in Barrow.
Number 1155
REPRESENTATIVE MASEK asked if the Twin Otters are safer to fly in
the rural areas compared to the Cessna 206 or 207.
Number 1180
MR. KRUSE replied that he has been around the Twin Otters since
1971 and has seen very few accidents and he knows they are a lot
safer.
Number 1214
JOHN HAJDUKOVICH, owner, Frontier Flying Service, testified via
teleconference from Fairbanks, that he has owned the service since
1974. He stated that the resolution should be extended beyond the
Bethel market. He stated that Alaska was focused on, when the
Lower 48 was having the accidents, to invoke one level of safety.
He stated that less then 1 percent of accidents have occurred on
the aircraft. He stated that to comply with the Commuter Rule
would be very costly and the question is whether or not the
passengers will be able to afford the airfare. He stated that they
have requested an extension of the implementation of the Commuter
Rule until Alaska can address the commuter industry within Alaska.
He stated that Guy Gardner replaced Tony Broderick and the acting
administrator is Barry Valentine. He stated that he supports HJR
27.
Number 1394
KIM ROSS, Executive Director, Alaska Aircraft Carriers Association,
testified via teleconference from Anchorage, that she is
representing 190 air carrier companies and associated businesses in
Alaska. She stated that with the additional economic pressures
that the Commuter Rule invokes, it has caused many of the carriers
to downsize the airplanes with less than ten seats. Other
operators are in a limbo position wondering if the obstacles
created by the new rule will prohibit their ability to move into
the new generation of aircraft. She stated that the Commuter Rule
is another instance of the federal government's inability to
acknowledge Alaska's unique operating environment. They are
attempting to force Alaska to fit their mold at the expense of the
safety of Alaska.
Number 1498
REPRESENTATIVE HUDSON asked what action the association is taking
to drive home the essence of HJR 27.
Number 1570
MS. ROSS replied that the association has spent a lot of effort and
time in putting together a 140 page document including a pictorial
of all of the aviation industry around the state.
Number 1557
JOSEPH SPRAGUE, Director of Marketing, ERA Aviation, testified via
teleconference from Anchorage, that ERA is the largest regional
airline in the state of Alaska. In 1996 Era carried just under
500,000 passengers, of which a large portion were Alaskan
residents. He stated that seven villages are served from an ERA
base in Bethel. He stated that ERA aviation is facing the
difficult decision of reducing service to Alaska's rural
communities. He stated that ERA's Twin Otters can accommodate up
to 18 passengers and are currently the only twin engine, turbo
prop, two pilot crew airplane, flown in village service from
Bethel. He stated that due to the Commuter Rule ERA will reduce
the seating capacity to a maximum of nine seats. These rules will
require ERA to operate the Twin Otters under the same guidelines of
major airlines, operating jet aircraft. He stated that these rules
are appropriate for jets flying between large cities, but are
completely inappropriate for a Twin Otter in bush operation. ERA
has requested that the FAA grant certain exemptions from the new
regulation. He stated that in 1995 the National Transportation
Safety Board published recommendations on approving aviation safety
in Alaska. Weather reporting, communications, and use of advanced
navigation, were all cited as ways to improve safety and placed the
burden to accomplish this on the FAA and the National Weather
Service. He stated that the report did not indicate that operators
should use certified aircraft dispatchers as the new rules require,
and it did not say that each operator should supply and train a
weather observer, nor did suggest that smaller aircraft carriers
should change to different rules in the name of safety. He stated
that ERA did have the intention to operate under these new rules,
however, it was found that it would be impossible to comply with
these regulations and continue to have a viable operation. The
Commuter Rule will negate the safety aspect by forcing passengers
onto smaller aircraft that have an inferior safety record. He
stated that if the Twin Otter is no longer in service in western
Alaska, the overall level of air carrier safety will decline. He
stated that according to the FAA's statistics in 1995 and 1996
there were a total of 67 accidents, seven of those in ten plus seat
aircraft. None of the seven would have been prevented had the new
rule been in effect. The concern in the decrease of safety is now
being expressed by the passengers that would be affected and are
worried about the disappearance of the Twin Otter in rural Alaskan
air service. He stated that the Commuter Rule does not apply a
higher level of safety rather it is a different level of safety,
one that was designed for larger aircraft operating between sizable
communities.
Number 1833
REPRESENTATIVE HUDSON made a motion to move HJR 27, with individual
recommendations and asked unanimous consent.
REPRESENTATIVE HUDSON stated that the name change of the
administrator would be a technical amendment.
Number 1898
CHAIRMAN WILLIAMS asked if there was an objection. Hearing none
HJR 27 was moved out of the House Transportation Standing
Committee.
HB 85 - DOT MAINTENANCE FACILITY AT SOLDOTNA
Number 1898
CHAIRMAN WILLIAMS stated that the next order of business is HOUSE
BILL NO. 85 "An Act giving notice of and approving a lease-purchase
agreement with the City of Soldotna for a maintenance facility of
the Department of Transportation and Public Facilities."
REPRESENTATIVE GARY DAVIS stated that HB 85 addresses a problem in
Soldotna and is trying to relocate the Department of Transportation
and Public Facilities (DOT/PF) maintenance facility which has been
located on a seven and one-half acre site in downtown Soldotna
since the early 1950s. There has been a lot of contamination on
the site and money expended in cleaning up the site. He stated
that the seven and one-half acre site is Kenai riverfront property,
which is the rational for the high priority, because of the
emphasis on trying to clean up the Kenai River and use it as a
pilot project for addressing these situations in other areas of the
state. He stated that all avenues of financing the relocation of
this facility need to be considered. It does need to be relocated
off the riverfront property, the current building is an eyesore and
there is a lot of traffic of large trucks into the site and onto
the highway. He stated that they have worked with the city and the
borough to locate a site that will be conveyed to the state for the
new facility. This legislation is approving lease purchase
authority for the state to enter into a lease purchase authority
depending on the availability of funds to relocate the site.
Number 2046
REPRESENTATIVE DAVIS stated that he does have an amendment. The
bill specifically speaks to the lease purchase agreement with the
city of Soldotna, there are other opportunities and other options
available and he would like to not discount the opportunity to
address other lease purchase options. He stated that the amendment
would not be specific to having the city sell the bonds, so that
then the state would enter into a lease purchase agreement with the
city of Soldotna to pay off the bonds and then ultimately own the
facility but there may be an option for the state to bond for the
facility and the project, eliminating the need for a middle man.
Number 2106
CHAIRMAN WILLIAMS asked if the move is because it is an eyesore or
if there are other reasons such as being environmentally unsafe.
Number 2119
REPRESENTATIVE DAVIS stated that yes, those reasons are the
rationality for the bill. He stated that it is an environmental
issue and they want to make sure that nothing affects the spawning
opportunities of the fish and that the river is kept as a vibrant
and viable sport fish river. He stated that along the river is
this barren and vacant DOT/PF site. It is largely an environmental
issue, the piles of calcium chloride salt runs down to the river
and could be a reason for the lack of vegetation down to the
riverbank.
Number 2210
REPRESENTATIVE COWDERY asked if there are any other contaminants,
such as hydrocarbon contaminants.
Number 2217
REPRESENTATIVE DAVIS replied that there has been studies that have
shown there still needs be additional clean-up on the site.
Number 2239
REPRESENTATIVE ELTON asked if we were bifurcating the options of
the original bill and the sponsor substitute.
Number 2254
REPRESENTATIVE DAVIS stated that this discussion is being separated
and that any testimony should be given on the original bill before
the amendment is offered.
Number 2275
REPRESENTATIVE HUDSON stated that he was looking at the 4/12/95
draft letter concerning the relocation, it is the Soldotna
Comprehensive Plan, pages 7-13 through 7-14. He stated that unless
he is misreading this, it sounds like the suggestion from the city
is that the state legislature should secure capital appropriation
for about six million from the general fund.
REPRESENTATIVE DAVIS stated that the letter was the initial attempt
to try and establish a straight capital grant, but due to the
finances at this time it was not really practical and we were
hoping that the bonding opportunity is more acceptable and yet
there is still questions on the financial viability of that.
Number 2332
REPRESENTATIVE HUDSON asked what the differences are between the
sponsor substitute and the original bill that is before this
committee. He stated that the original bill talked about the city
of Soldotna financing the building and then the state, in a period
of ten years, would pay for that bonded indebtiness and asked if
that was correct.
Number 2346
REPRESENTATIVE DAVIS replied that was correct.
Number 2350
REPRESENTATIVE HUDSON asked in the sponsor substitute who would
submit the bond.
Number 2356
REPRESENTATIVE DAVIS replied that he wanted to make this perfectly
clear, that it is the intent that the city of Soldotna will have
the option to sell the bonds and for the state to lease from the
city. The proposed amendment would offer an additional option and
leave it open as to who the state could bond with. The state could
bond it themselves as a G.O. bond. He stated that the only
alternative that the amendment is offering, is that the state can
bond it or the city can bond it also.
Number 2388
REPRESENTATIVE HUDSON asked that you are looking for the option of
flexibility of either going with the city or perhaps the state G.O.
bonding.
Number 2393
REPRESENTATIVE DAVIS replied that was correct.
Number 2397
REPRESENTATIVE HUDSON asked if the remediation or the mitigation of
the existing site is state property and stated that it would
require some mitigation before anything is done with it.
Number 2425
REPRESENTATIVE DAVIS replied that was correct and that there has
been two appropriations to address that in 1995 and 1996 for a
total of $737,000 of which not all has been spent. He stated that
there was an additional allocation of $100,000 in 1995 for design
and preliminary work on the new facility but could be converted to
cleanup dollars if needed. He stated that there will be additional
remediation needed and the city of Soldotna will testify that it
would need to be in acceptable condition before they would accept
it.
Number 2440
REPRESENTATIVE HUDSON asked if the state would have the option to
take the remediated site and sell it the public and could they
apply that to the bond.
Number 2461
REPRESENTATIVE DAVIS replied that all those options are available
and that it is a consensus that the land would be conveyed to the
city, should it be acceptable to the city and then there are
specific plans for that site.
97-14, SIDE B
Number 008
REPRESENTATIVE HUDSON stated that it should be recognized that
fully remediated prime property in return for a bond, that we are
still going to pay for, ought to have some value to offset the cost
of the bond to the general public and through the state. Perhaps
we would ask the city to let us know what it is worth to them.
Number 023
CHAIRMAN WILLIAMS asked how much the DOT/PF is paying for the
facility now.
Number 030
REPRESENTATIVE DAVIS replied that they are paying for their annual
maintenance and fees and for the normal operation of a state
facility.
Number 039
CHAIRMAN WILLIAMS stated that he liked where Representative Hudson
was coming from with the land and the new facility.
REPRESENTATIVE DAVIS stated that it is an additional expense over
the period of the bond.
Number 049
REPRESENTATIVE HUDSON stated that he has lived there and he fully
supports the need to get it off the riverbank and to get it where
it should be.
Number 058
REPRESENTATIVE ELTON stated that it was his understanding that a
portion of the $6 million is designed for remediation and about $1
million is for site remediation and if that is the case, since
$700,000 has already used, site remediation would be for the amount
of $1.7 million dollars.
Number 089
REPRESENTATIVE DAVIS replied that is an option for bond dollars to
be spent on remediation and it is his understanding that it is a
legal option to utilize bond dollars. He stated, "It is my intent
to keep the actual bond as minimal as possible. If we could get it
down to $4 million and reduce annual payments that would be great."
He stated that would be utilizing an opportunity for dollars for
remediation.
Number 116
REPRESENTATIVE ELTON stated that where he is getting confused is in
the 1/19/96 letter from Commissioner Perkins where it says,
"current construction cost estimate for the facility is $4.5
million and then site cleanup and rehabilitation would cost an
additional $1 million. I guess I was thinking okay, that is $5.5
million and then another $500,000 of unanticipated costs. But then
when you said there was already $700,000 available for site
remediation." He asked if $6 million is the needed figure or is it
$4.5 million.
Number 144
REPRESENTATIVE DAVIS replied that $6 million would be the needed
figure, if bond dollars were used for some of the remediation
project.
Number 150
REPRESENTATIVE ELTON stated that maybe the sponsor would want to
think about some additional language. He stated that he does not
have a problem with a process which moves the building from one
site to another and keeps the existing site a public access site.
He stated that maybe the sponsor would consider amending this to
provide, that if the city of Soldotna once it is transferred, ever
decides to sell that land, the proceeds of the sale may go back to
the state.
Number 191
REPRESENTATIVE DAVIS stated that he would not have a problem with
that but he has found that most of the parties involved would like
to see it remain a public property.
Number 203
REPRESENTATIVE HUDSON stated that he believed that the land belongs
to the state so it should not get to the city without the state
taking some action.
REPRESENTATIVE ELTON stated that it was his understanding that the
site would be transferred to the city.
REPRESENTATIVE HUDSON stated that is what they would desire but it
is not contained within the provisions of the bill.
Number 226
REPRESENTATIVE AL KOOKESH stated that the way he understands it, is
that last year and the year before you tried to get money into the
capital budget and weren't able to do it, the state can't afford to
build it, Soldotna wants to issue some revenue bonds so they can
afford to build it themselves, the state will lease it back to
DOT/PF and at the end of the lease period the state will own the
facility and the only question is who will own the old site.
Number 254
REPRESENTATIVE DAVIS stated that it is correct and like any prudent
business, no one would accept a contaminated site. He stated that
it would probably take a couple of years for the state to get it
cleaned up, depending on the cost. The city of Soldotna would like
to have the land cleaned up and conveyed to the city so that they
could extend an adjoining park and other additional facilities on
the site.
Number 293
REPRESENTATIVE KOOKESH stated that he does not have a problem with
the bill, except he has a question of who will own the site after
it is cleaned up because someone will have to clean it up. He
stated, "I guess if we wanted to divorce something right now we
divorce that question and go on with the bill."
REPRESENTATIVE DAVIS stated that is correct. The bill is strictly
a finance bill to provide a financing mechanism for a new facility,
the rest of the questions are somewhat off the table.
Number 328
LISA PARKER, Planning Director, Kenai Peninsular Borough, testified
via teleconference from Kenai, in support to relocate the
maintenance facility on the Kenai river. She stated that the
borough has been working in cooperation with the DOT/PF to relocate
the facility. She stated that in the near future the borough will
issue the DOT/PF a limited entry permit and begin to develop the 48
acre parcel. Once we have finished the planning process, the
borough will quit claim this parcel to the state of Alaska. She
stated that the borough strongly supports the bill.
Number 381
REPRESENTATIVE HUDSON asked if his understanding was correct that
the city would own the property that the new facility would be
built upon and it would be quit claimed to the state, so that it is
an asset from the city to the state.
Number 397
MS. PARKER stated that the 7.5 acre parcel is owned by the DOT/PF
and once the site is declared to be surplus by the DOT/PF it
reverts to the Department of Natural Resources to determine the
further disposition of that land.
Number 453
TOM BOEDEKER, City Manager, City of Soldotna, stated that he is in
support of the legislation to authorize the lease purchase
financing mechanism as an option to cause the relocation of the
existing maintenance facility for DOT/PF in Soldotna. He stated
that there have been a number of activities involving hydrocarbons
on this site and there have been efforts to remediate those in the
last few years but it is difficult to clean-up an ongoing activity
site. He stated that moving the facility will allow clean-up to
occur in a more orderly and efficient manner. He stated that a
spill will cause contamination of the river. He stated that there
is a large amount of chloride contamination on the site. The new
site will move all of the activities out of the present site where
it created a risk of impact. He stated that it is an eyesore. The
city has been willing to bond this to get the move made. He stated
that the existing site be conveyed to the city of Soldotna and
there are clean-up issues in which the city can't afford to take
the land without it being cleaned up. He stated that the city's
desire to have land is to ensure that it is used to for a park or
similar activities that are consistent with the Kenai River. He
stated that the city council feels they can do a better job of
managing the property than trusting the state to do it. He stated
that the city wants the use of the land restricted and feels that
they could not control that if it was not theirs. He stated that
as far as the amendment is concerned the city does not have a
problem with allowing another financing option but wants to be sure
that the option for the city to issue revenue bonds is open and
does not want any kind of amendment that would delay financing and
moving this facility. He stated the Kenai River is extremely
important to the economy of Soldotna and anything that damages that
river is a serious threat to the lifestyle and well-being of
Soldotna.
Number 740
REPRESENTATIVE HUDSON asked if the city of Soldotna currently
maintains its highway and road maintenance facility.
Number 752
MR. BOEDEKER replied that it is out on Funny River Road.
Number 759
REPRESENTATIVE HUDSON asked if that facility could be expanded to
have a multiple facility, if the state could join with the city to
have a combined facility in exchange for a remediated piece of
property.
Number 780
MR. BOEDEKER replied that it could be managed. He stated that
there are two issues dealing with the cities maintenance
facilities. It is located on airport property and a large part of
the maintenance equipment is used for the airport maintenance that
the city has. He stated that because of the restrictions on that
property there has to be a rent paid that goes into the airport
fund and that site is as large as it can get. It is back one
hundred yards from the bank of the river, it is something that can
be looked at.
Number 843
REPRESENTATIVE ELTON asked when the city of Soldotna constructs
public facilities of other buildings or roads are they done under
the terms of a project labor agreement.
Number 856
MR. BOEDEKER replied that the city is subject in any project that
they do to the prevailing wage requirement.
REPRESENTATIVE ELTON stated that a project labor agreement would
assure that the project is built with union labor.
Number 869
MR. BOEDEKER stated that we have not done projects guaranteeing
union labor, it is an option but we have always had them open to
bid and paid the prevailing wage schedule.
Number 893
CHAIRMAN WILLIAMS called a brief at ease at 2:33 p.m.
Number 893
CHAIRMAN WILLIAMS called the House Transportation Standing
Committee back to order at 2:45 p.m.
Number 933
REPRESENTATIVE DAVIS stated that he did not get the sponsor
substitute finished in time, as it needs to go through a five day
process and he would appreciate if the sponsor substitute be
considered as Amendment 1.
Number 960
REPRESENTATIVE HUDSON moved to adopt Amendment 1, currently
identified as sponsor substitute, 3/7/97, E Version.
CHAIRMAN WILLIAMS asked if there was any objections.
REPRESENTATIVE KOOKESH objected to ask a question. He asked, "What
is the difference between this bill and the other bill, I
understand in the first bill we have Soldotna doing the revenue
bonds, and the next bill we have the state doing the revenue
bonds."
Number 1053
REPRESENTATIVE DAVIS stated that the original bill did have the
city of Soldotna issuing the bonds and then the state leasing from
the city of Soldotna, with Amendment 1, it will allow the option
for the state to bond. He said, "The reason for that is there are
other bills working their way through the hopper that could
possibly get up to finance, as hopefully this one will too, and if
there is $30 million, $40 million, $50 million approved for the
state to bond, the state could make one heck of a savings on a $30
million bond compared to Soldotna's $5 million or $6 million bond.
So that's the rational, in hope of saving money and reducing
substantially, the monthly payment on this project."
Number 1035
REPRESENTATIVE KOOKESH withdrew his objection.
Number 1049
REPRESENTATIVE ELTON stated that this would give the state the
ability to refinance if the rates go down even if you don't add
incrementally and the state could then refinance and get the
savings rather than the city of Soldotna.
Number 1053
REPRESENTATIVE DAVIS stated that Representative Elton was correct
and that it was a big advantage of this amendment.
Number 1060
CHAIRMAN WILLIAMS asked if there was any objections to Amendment 1.
Hearing none, Amendment 1 was adopted.
Number 1070
REPRESENTATIVE ELTON made a motion to move CSHB 85(TRA), as
amended, with the attached fiscal note and individual
recommendations.
Number 1077
CHAIRMAN WILLIAMS asked if there were any objections. Hearing none
CSHB 85(TRA) was moved out of the House Transportation Standing
Committee.
ADJOURNMENT
Number 1083
CHAIRMAN WILLIAMS adjourned the House Transportation Standing
Committee at 2:50 p.m.
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