Legislature(1995 - 1996)

02/21/1996 01:42 PM TRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
            HOUSE TRANSPORTATION STANDING COMMITTEE                            
                       February 21, 1996                                       
                           1:42 p.m.                                           
 MEMBERS PRESENT                                                               
 Representative Gary Davis, Chairman                                           
 Representative Beverly Masek, Vice Chair                                      
 Representative Jeanette James                                                 
 Representative Tom Brice                                                      
 Representative Bill Williams                                                  
 Representative Don Long                                                       
 MEMBERS ABSENT                                                                
 Representative Jerry Sanders                                                  
 COMMITTEE CALENDAR                                                            
 HOUSE JOINT RESOLUTION NO. 49                                                 
 Proposing amendments to the Constitution of the State of Alaska               
 creating a highway fund.                                                      
      - MOVED OUT OF COMMITTEE                                                 
 * HOUSE BILL NO. 498                                                          
 "An Act naming the Bette Cato Bridge in Valdez."                              
      - MOVED OUT OF COMMITTEE                                                 
 *HOUSE BILL NO. 517                                                           
 "An Act relating to records and hearings of the Department of                 
 Public Safety; relating to a temporary permit to drive a motor                
 vehicle; relating to regulation of motor vehicles and commercial              
 motor vehicles; relating to renewal of a driver's license by mail;            
 increasing the property damage amounts for proof of financial                 
 responsibility and proof of motor vehicle eligibility in order to             
 lawfully operate a motor vehicle in the state; relating to certain            
 notifications in accidents involving property damage; relating to             
 motor vehicle registration procedures; and providing for an                   
 effective date."                                                              
      - HEARD AND HELD                                                         
 (* First public hearing)                                                      
 PREVIOUS ACTION                                                               
 BILL:  HJR 49                                                                
 SHORT TITLE: DEDICATED HIGHWAY FUND                                        
 BILL VERSION:                                                                 
 SPONSOR(S): REPRESENTATIVE(S) JAMES                                           
 JRN-DATE     JRN-PG            ACTION                                         
 05/16/95      2238    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 05/16/95      2239    (H)   STATE AFFAIRS, TRANSPORTATION, FINANCE            
 02/01/96              (H)   STA AT  8:00 AM CAPITOL 102                       
 02/01/96              (H)   MINUTE(STA)                                       
 02/02/96      2597    (H)   STA RPT  CS(STA) NT 3DP 2NR                       
 02/02/96      2597    (H)   DP: PORTER, GREEN, JAMES                          
 02/02/96      2597    (H)   NR: OGAN, IVAN                                    
 02/02/96      2598    (H)   FISCAL NOTE (DOT)                                 
 02/02/96      2598    (H)   REFERRED TO TRANSPORTATION                        
 02/14/96              (H)   TRA AT  1:00 PM CAPITOL 17                        
 02/21/96              (H)   TRA AT  1:00 PM CAPITOL 17                        
 BILL:  HB 498                                                              
 SHORT TITLE: BETTY CATO BRIDGE IN VALDEZ                                     
 SPONSOR(S): TRANSPORTATION                                                    
 JRN-DATE     JRN-PG            ACTION                                         
 02/12/96      2723    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/12/96      2723    (H)   TRANSPORTATION, STATE AFFAIRS                     
 02/21/96              (H)   TRA AT  1:00 PM CAPITOL 17                        
 BILL:  HB 517                                                              
 SPONSOR(S): TRANSPORTATION                                                    
 JRN-DATE     JRN-PG            ACTION                                         
 02/14/96      2750    (H)   READ THE FIRST TIME - REFERRAL(S)                 
 02/14/96      2751    (H)   TRANSPORTATION, JUDICIARY                         
 02/21/96              (H)   TRA AT  1:00 PM CAPITOL 17                        
 WITNESS REGISTER                                                              
 BOB BARTHOLOMEW, Deputy Director                                              
 Income and Excise Audit Division                                              
 Department of Revenue                                                         
 P.O. Box 110420                                                               
 Juneau, Alaska  99501-3566                                                    
 Telephone:  (907) 465-2320                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA)                               
 SAM S. KITO III, Special Assistant                                            
 Office of the Commissioner                                                    
 Department of Transportation and Public Facilities                            
 3132 Channel Drive                                                            
 Juneau, Alaska  99801-7898                                                    
 Telephone:  (907) 465-3904                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA)                               
 FRANK DILLON, Executive Director                                              
 Alaska Trucking Association, Incorporated                                     
 Board Member, Center for Employment Education                                 
 3443 Minnesota Drive                                                          
 Anchorage, Alaska  99501                                                      
 Telephone:  (907) 276-1149                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA) and HB 517                    
 MARLA ATKINS                                                                  
 P.O. Box 461                                                                  
 Cordova, Alaska  99574                                                        
 Telephone:  (907) 424-7311                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA)                               
 BARBARA HUFF TUCKNESS                                                         
 Teamsters 959                                                                 
 4300 Boniface Parkway                                                         
 Anchorage, Alaska  99504                                                      
 Telephone:  (907) 269-4236                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA)                               
 RAY GILLESPIE, Lobbyist representing the City of UnAlaska                     
 Gillespie and Associates                                                      
 9478 Riverbend Court                                                          
 Juneau, Alaska  99801                                                         
 Telephone:  (907) 463-3375                                                    
 POSITION STATEMENT:  Testified on CSHJR 49(TRA)                               
 SHERI CAPLES                                                                  
 Valdez City Council                                                           
 P.O. Box 307                                                                  
 Valdez, Alaska  99686                                                         
 Telephone:  (907) 835-4313                                                    
 POSITION STATEMENT:  Supported HB 498                                         
 REPRESENTATIVE GENE KUBINA                                                    
 Alaska State Legislature                                                      
 State Capitol, Room 406                                                       
 Juneau, AK  99801                                                             
 Telephone: (907) 465-4859                                                     
 POSITION STATEMENT:  Supported HB 498                                         
 SANDY PERRY-PROVOST, Special Assistant                                        
 Office of the Commissioner                                                    
 Department of Public Safety                                                   
 P.O. Box 111200                                                               
 Juneau, Alaska  99811-1200                                                    
 Telephone:  (907) 465-4322                                                    
 POSITION STATEMENT:  Testified on HB 517                                      
 JAY N. DULANY, Director                                                       
 Central Office                                                                
 Division of Motor Vehicles                                                    
 Department of Public Safety                                                   
 5700 East Tudor Road                                                          
 Anchorage, Alaska  99507-1225                                                 
 Telephone:  (907) 269-5559                                                    
 POSITION STATEMENT:  Testified in support of HB 517                           
 BRAD BROWN, State Trooper                                                     
 Central Office                                                                
 Division of Alaska State Troopers                                             
 Department of Public Safety                                                   
 5700 East Tudor Road                                                          
 Anchorage, Alaska  99507-1225                                                 
 Telephone:  (907) 278-0312                                                    
 POSITION STATEMENT:  Testified in support of HB 517                           
 JOE CRUM, Director of Training                                                
 Center for Employment Education                                               
 1049 Whitney Street                                                           
 Anchorage, Alaska  99501                                                      
 Telephone:  (907) 279-8451                                                    
 POSITION STATEMENT:  Testified in support of HB 517 and provided              
 STEVE ALLWINE                                                                 
 Alaska Auto Dealers Association                                               
 8725 Mallard Street                                                           
 Juneau, Alaska  99801                                                         
 Telephone:  (907) 789-1386                                                    
 POSITION STATEMENT:  Testified in support of HB 517                           
 ACTION NARRATIVE                                                              
 TAPE 96-6, SIDE A                                                             
 Number 000                                                                    
 The House Transportation Standing Committee was called to order by            
 Chairman Gary Davis at 1:42 p.m.  Members present at the call to              
 order were Representatives G. Davis, James, Brice, Long, and                  
 Williams.  A quorum was present.  This meeting was teleconferenced            
 to Anchorage, Cordova and Valdez.                                             
 CHAIRMAN GARY DAVIS announced that the agenda was HJR 49, HB 498,             
 and HB 517.                                                                   
 HJR-49 DEDICATED HIGHWAY FUND                                                
 CHAIRMAN GARY DAVIS said a subcommittee met last week to discuss              
 the language of HJR 49.  He apologized for the oversight of not               
 including a member of the minority in those discussions.  He said             
 this discussion led to a work draft form of CSHJR 49(TRA), version            
 REPRESENTATIVE BILL WILLIAMS made a motion to adopt CSHJR 49(TRA)             
 as the working document.  Hearing no objection, CSHJR(TRA) was                
 adopted as the working document for the House Standing Committee on           
 CHAIRMAN GARY DAVIS said the essence of the change made and                   
 incorporated in CSHJR 49(TRA) is a change from a highway to a                 
 transportation fund.  The transportation fund creates a fund for              
 the revenues derived from the propulsion of motor vehicles for the            
 operation and maintenance of roads and highways and also sets up a            
 fund for revenues derived from marine fuel taxes to be used for the           
 construction and improvement of harbor facilities.                            
 Number 151                                                                    
 REPRESENTATIVE JAMES expressed concern relating to the inclusion of           
 marine taxes within CSHJR 49(TRA).  She said she had kept the                 
 original HJR 49 narrow in order to get the two-thirds vote needed             
 to put the resolution on the ballot, and to get the votes necessary           
 to make it a constitutional amendment.                                        
 Number 213                                                                    
 REPRESENTATIVE JAMES said the fiscal note, she believed, would                
 prevent the passage of CSHJR 49(TRA).  She said the fiscal note               
 identifies that marine fuel taxes go for construction and                     
 improvement, of which only 37 percent have been utilized in the               
 past.  She said the remaining 63 percent of the taxes had gone into           
 the general fund used for ordinary expenses.  She said, as a                  
 result, a huge fiscal note would be required for CSHJR 49(TRA).               
 Number 295                                                                    
 CHAIRMAN GARY DAVIS, "you yourself have addressed the fiscal note             
 with the three-fifths vote to spend outside of the dedication area,           
 so that is the only answer or area we could go to, to address that,           
 whether that is enough to satisfy that concern or not, I'm not                
 sure."  He believed that the inclusion of the marine component                
 would improve its chances of passing because of gaining support               
 from the coastal communities in the state of Alaska.                          
 Number 420                                                                    
 REPRESENTATIVE BRICE asked how the two funds would be segregated in           
 the fiscal note.  He mentioned that only a minimal amount of money            
 should be spent on administrative costs, leaving as much as                   
 possible for use on construction and development of transportation            
 needs in the state.                                                           
 Number 506                                                                    
 BOB BARTHOLOMEW, Deputy Director, Income and Excise Audit Division,           
 Department of Revenue, responded to the question regarding the                
 fiscal note.  He said currently the marine fuel taxes are deposited           
 into the general fund with appropriations coming out of the fund.             
 He said research would need to be done to determine whether the               
 amount spent on harbor facilities, in the capital or operating                
 budget, is equal to the amount of the taxes.  He said information             
 from Office of Management and Budget (OMB) would need to be                   
 received to make that determination and whether a fiscal note is              
 Number 596                                                                    
 CHAIRMAN GARY DAVIS commented that it might be possible that we are           
 spending all the marine fuel tax revenues collected.                          
 MR. BARTHOLOMEW said that it might be possible.                               
 Number 621                                                                    
 REPRESENTATIVE JAMES said according to testimony from the                     
 Department of Transportation and Public Facilities (DOT/PF),                  
 currently, only 37 percent of the marine fuel tax is being spent on           
 maintenance of harbor facilities.  She said the rest of the money             
 is remaining in the general fund.  She requested that Mr. Kito                
 comment on this information.                                                  
 Number 676                                                                    
 SAM S. KITO III, Special Assistant, Office of the Commissioner,               
 Department of Transportation and Public Facilities, commented that            
 the reference to 37 percent was an average taken over five years.             
 The 37 percent, of the marine fuel tax, included revenue that went            
 to the DOT/PF for harbor construction projects.  The maintenance              
 dollars that the state or department expends on the harbors is an             
 unknown amount at this time.                                                  
 CHAIRMAN GARY DAVIS remarked that this might be a negligible fee              
 and commented that operation costs and basic maintenance costs come           
 from local slippage and moorage fees.                                         
 Number 715                                                                    
 MR. KITO said many of these harbors are managed by the                        
 Number 726                                                                    
 REPRESENTATIVE JAMES pointed out that 63 percent of the marine fuel           
 tax goes into the general fund to pay for other things.  She said             
 a vacancy of 63 percent, from the general fund, would need an                 
 attached fiscal note.  She said either the general budget would               
 have to be cut by that amount or the capital budget would need to             
 be increased by this amount.  She added that the inclusion of a               
 legislative four-fifths vote to use any additional funds for other            
 purposes would be difficult.                                                  
 REPRESENTATIVE JAMES said it is in this area where the difference             
 between a fund for highway and marine fuel taxes differ.  Currently           
 the revenue derived from the highway fuel tax is less than the                
 amount expended, whereas there is money derived from the marine               
 fuel tax being used for other things.                                         
 Number 835                                                                    
 REPRESENTATIVE DON LONG mentioned the 37 percent of the marine fuel           
 tax and said he hadn't seen anything in the constitution that                 
 dedicated that marine fuel tax to a marine fund.                              
 Number 855                                                                    
 MR. KITO said the 37 percent of the marine fuel tax is an estimate            
 based on what DOT/PF has spent on capital expenditures on marine or           
 harbor systems, averaged out, compared to the amount collected in             
 Number 871                                                                    
 REPRESENTATIVE LONG clarified that everything goes into the general           
 fund, but this 37 percent has been identified as the amount of                
 money expended.                                                               
 Number 880                                                                    
 REPRESENTATIVE BRICE said approximately three times as much is                
 being spent on highway maintenance out of the general fund than               
 what is being brought in from the highway fuel tax.                           
 Number 925                                                                    
 FRANK DILLON, Executive Director, Alaska Trucking Association,                
 Incorporated, was next to testify via teleconference from                     
 Anchorage.  He was in support of a dedicated fund as specified in             
 CSHJR 49(TRA).  He said in 1990, his company suggested a dedicated            
 fund derived from highway money collected from highway users to be            
 put back for the maintenance of the highway.                                  
 Number 969                                                                    
 MR. DILLON said the language contained, on page two, line two, "or            
 operating costs", is of concern.  He said his company would not               
 support CSHJR 49(TRA) if that language is included.  He said this             
 fund should be established for maintenance only in a manner that is           
 clear and narrowly defined.  He said the language of this                     
 definition should indicate that it is for maintenance of the                  
 existing transportation infrastructure with current vehicle rights-           
 Number 1015                                                                   
 MR. DILLON said his industry does not envision that the DOT/PF's              
 budget should be covered by what is collected in a maintenance                
 fund.  He said the community of Alaska highway users is small and             
 cannot fund DOT/PF's budget.  He said the fund should collect                 
 taxes, that are reasonable, to maintain the highways and desist               
 from the practice of deferred maintenance.  He said this policy of            
 deferred maintenance means that the job is done later at a greater            
 expense.  He said the situation now, is that the maintenance has              
 been deferred to the point where the DOT/PF is, in some areas,                
 uncertain about the longevity baseline of their highways.  He said            
 money will need to be expended to bring the highways and roads up             
 to par.                                                                       
 Number 1093                                                                   
 MR. DILLON said the industry looks at the DOT/PF's budget with                
 trepidation.  He said the average tractor-trailer currently pays a            
 little bit in excess of $7,000 in state, local and federal taxes              
 and fees, to operate in the state of Alaska.  The combined                    
 contribution, by truck users within the state and truck users                 
 outside the state, is approximately $90 million per year to the               
 treasury of the state of Alaska.  He said this figure was derived             
 from the fact that the industry gets back approximately seven to              
 one on highway truck fund dollars, and approximately 40 percent of            
 the federal highway trust fund is money that comes directly out of            
 the trucking industry's pocket.  This money is paid by truck users            
 within and outside of the state.  He said his industry makes a                
 significant contribution for highway maintenance and new                      
 construction.  He hoped that the reauthorization of the highway               
 bill in 1997 will free up money for general highway maintenance               
 purposes so that more maintenance can occur then has in the past.             
 MR. DILLON said by establishing a dedicated fund, with a clear                
 understanding that this fund is going to be used to improve the               
 situation for Alaska highway users, is a marketable device in                 
 getting people to accept a higher highway fuel tax.  The polling              
 done by his industry indicates that without some sort of dedication           
 to funding, people don't trust that paying a higher fuel tax will             
 result in better roads.  He cautioned that if a higher fuel tax               
 merely results in higher spending at DOT/PF, the state gains                  
 nothing and the public feels they are paying an even greater                  
 subsidy to the general fund and other uses than they do now.                  
 Number 1205                                                                   
 CHAIRMAN GARY DAVIS said, from committee discussions, there is                
 agreement concerning the language, "or operating costs".  He said             
 the definition suggested by Mr. Dillon would put everyone                     
 agreement.  He said, in discussions by the subcommittee relating to           
 operating costs, the proposals included maintenance of the roads              
 and facilities.  He said the discussion of facility maintenance               
 included the fencing around the DOT maintenance facility, the                 
 buildings, the occasional need of new fuel pumps, painting of the             
 buildings, as well as other things.  He said you could get as                 
 detailed as the operating expenses, operators, superintendents and            
 supervisors.  He said these are the things the committee is                   
 addressing when maintenance and operating cost is included and are            
 found in statutory definitions.  He asked if Mr. Dillon had the               
 same understanding in his definition of maintenance.                          
 Number 1289                                                                   
 MR. DILLON said his perception of maintenance included more than              
 simply maintaining the highway features such as ditches and                   
 drainage, but he wanted to see the language confined as narrowly as           
 possible to the actual maintenance of the roadway itself.  He                 
 mentioned the confusion surrounding the marine highway system and             
 exactly what things would be eligible, in terms of maintenance                
 expenses.  He mentioned that the Alaska Marine Highway System is              
 defined as a highway.  He said, even with a tax of 50 cents a                 
 gallon, the fund would probably not have enough money to take care            
 of the DOT/PF's maintenance desires.  He said the DOT/PF has been             
 inadequately funded for some period of time as seen in their budget           
 over the past ten years.  The DOT/PF has been asked to do more, in            
 terms of added lane miles and meeting federal requirements, without           
 receiving adequate funding.  He said the state is behind, in terms            
 of bridge maintenance and pavement maintenance, to the point that             
 it will cripple the state's economy.  He said without an investment           
 in the infrastructure, a steady and ongoing quality maintenance               
 program, economic development won't occur because people will not             
 locate in such an area.                                                       
 Number 1385                                                                   
 CHAIRMAN GARY DAVIS said the committee would consider all of his              
 concerns and would address them in the legislation.                           
 Number 1413                                                                   
 MARLA ATKINS testified via teleconference from Cordova.  She asked            
 for clarification of whether the state cross- uses funds for                  
 maintenance of roads, harbors and new construction or whether they            
 are separated individually by mode.                                           
 Number 1441                                                                   
 CHAIRMAN GARY DAVIS said the tax revenues are all put into the                
 general fund and, as needed and approved by the legislature, they             
 are distributed to different accounts.                                        
 Number 1446                                                                   
 MS. ATKINS referred to page one, Section 7, discussing dedicated              
 funds, she read "the proceeds of any state tax or license shall not           
 be dedicated to any special purpose.  This provision shall not                
 prohibit the continuation of any dedication existing prior to                 
 1956", and asked if this meant that there were dedicated taxes from           
 gas taxes.                                                                    
 Number 1474                                                                   
 CHAIRMAN GARY DAVIS said there are dedicated funds, not                       
 specifically fuel taxes, but that Section 7 relates to any                    
 dedicated funds in the state and mentioned the Fisherman Fund as an           
 Number 1499                                                                   
 MS. ATKINS referred to Section 18, on page one, regarding the                 
 transportation fund and asked if the taxes from the various modes             
 would be placed into one account or whether it would be segregated            
 into specific accounts relating to the specific taxes.                        
 Number 1524                                                                   
 CHAIRMAN GARY DAVIS said the fund is broken down by subparagraph              
 one and two, which separated the highway funds from the marine                
 Number 1539                                                                   
 MS. ATKINS asked how this was going to work if there was not                  
 currently enough money for the highways.                                      
 CHAIRMAN GARY DAVIS said hopefully funds would be established for             
 highway maintenance.  He said, currently, only $24 million is being           
 generated and $75 million is being spent.  He said CSHJR 49(TRA) is           
 only a first step.                                                            
 MS. ATKINS clarified that currently the funds can be crossed over,            
 but under CSHJR 49(TRA) this couldn't happen.                                 
 Number 1569                                                                   
 CHAIRMAN GARY DAVIS said money could be utilized for other purposes           
 with a three-fifths vote of the legislature.                                  
 Number 1580                                                                   
 MS. ATKINS said she supports the concept of the dedicated gas fuel            
 tax.  She felt the gas tax would need to be raised in order to                
 maintain the highways.  She said the highway infrastructure is                
 badly in need of work throughout the state.  She said, if we are              
 going to develop tourism and economic development in Alaska, we               
 need to provide an infrastructure.  She said the state gets a                 
 higher return on the gas tax than states back in the East Coast               
 MS. ATKINS said she supports a gas tax and would want a dedication            
 of the fuel taxes to improve the road system, bring maintenance up            
 to standard and for new roads.  She mentioned that Alaska has fewer           
 line miles than any state in the union which is difficult in terms            
 of tourism.                                                                   
 MS. ATKINS expressed concern over administrative costs versus                 
 maintenance costs.  She referred to the former Lieutenant Governor            
 Coghill (indiscernible) "understood that they were going to revamp            
 everything down there if they could and try to leave more people in           
 the field and less people in the Administration, instead, it turned           
 out we're back to cutting in the field."  She referred to Cordova             
 and mentioned the states cutback of eleven to six men for                     
 maintenance.  She said they cannot keep up with the maintenance in            
 MS. ATKINS concluded that she wanted to see a raised gas tax that             
 is dedicated to a specific fund in order to get the public to vote            
 for it.                                                                       
 Number 1704                                                                   
 BARBARA HUFF TUCKNESS, Teamsters Local 959, testified via                     
 teleconference from Anchorage.  She said her organization represent           
 truckers and various people who use the highway infrastructure.               
 She said truckers deal with the infrastructure when they are going            
 up mountain passes with double loaders and de-booting them in order           
 to take one trailer at a time through some of those areas.  She               
 said this is less of a problem then it has been in the past.  She             
 said Teamsters Local 959 supports CSHJR 49(TRA).  She said a focus            
 needs to be placed on the maintenance of the highways.                        
 Number 1782                                                                   
 REPRESENTATIVE LONG asked how the motor fuel and water taxes are              
 separated, especially in areas where there is only one pump                   
 Number 1803                                                                   
 MR. BARTHOLOMEW said, currently, the identification is made by the            
 qualified fuel dealer or wholesaler who is paying the taxes                   
 upstream from a central spot.  When the fuel is sold a                        
 determination is made regarding how the fuel will be used.  He said           
 there is some inevitable crossover, but the Department of Revenue             
 (DOR) records the type of fuel tax according to how it is placed in           
 the tax returns.                                                              
 Number 1850                                                                   
 CHAIRMAN GARY DAVIS clarified that it is up to the wholesale dealer           
 to record it and hopefully they are doing this to the best of their           
 Number 1862                                                                   
 MR. BARTHOLOMEW said there would need to be some sort of education            
 process put on by the DOT/PF and the DOR.                                     
 Number 1872                                                                   
 REPRESENTATIVE BRICE questioned how the different types of tax,               
 associated with different fuel use, was going to be differentiated,           
 especially in rural Alaska.  He also questioned the staff turnover            
 and whether or not that would impact this process.                            
 Number 1958                                                                   
 MR. BARTHOLOMEW said the DOR would set up some guidelines when the            
 wholesalers are dispatching it to the rural retailers, so they can            
 try to come up with an average, periodically reviewed and altered.            
 Number 1976                                                                   
 REPRESENTATIVE BRICE said this system should not be too precise.              
 MR. BARTHOLOMEW said the concern would be one of creating more                
 paperwork.  He said the DOR and the industry could develop some               
 guidelines to allow the industry to do some fuel tax                          
 REPRESENTATIVE BRICE said fuel used for marine purposes "probably             
 runs 35, 40, up to 50 percent of gas sales."                                  
 REPRESENTATIVE LONG said it would also depend on the time of the              
 REPRESENTATIVE JAMES clarified that unleaded gas could be put in              
 boat motors.                                                                  
 Number 2035                                                                   
 REPRESENTATIVE LONG asked if these taxes included snow machines and           
 all terrain vehicles.                                                         
 MR. BARTHOLOMEW said there is a separate tax called the off-highway           
 use tax.  He said if a vehicle was used off-highway there is a 2              
 cent tax.  He explained that the 8 cent per gallon tax is paid, but           
 an exemption can be filed to receive a 6 cent per gallon rebate.              
 He said the rebate allows the DOR to track how much off highway use           
 there is in the state.                                                        
 Number 2082                                                                   
 MR. DILLON interjected that there is some strict accounting by the            
 federal government for fuel tax purposes in order to prevent people           
 from paying the tax.  He mentioned that because marine fuel tax was           
 a lesser amount than the highway fuel tax, he wouldn't be surprised           
 if trucks in Southeast were running around using boat fuel.                   
 Number 2125                                                                   
 RAY GILLESPIE, Lobbyist representing the City of UnAlaska,                    
 Gillespie and Associates, was next to testify.  He said the city of           
 UnAlaska supports CSHJR 49(TRA) with the inclusion of the marine              
 fuel as they believe it is a good first step to addressing some of            
 the funding inadequacies for ports and harbors.  He mentioned the             
 inclusion of marine fuel tax in the CSHJR 49(TRA) will have a                 
 broader appeal statewide.                                                     
 Number 2154                                                                   
 REPRESENTATIVE JAMES asked what the total amount of revenues                  
 collected from marine fuels was.                                              
 MR. KITO said this information was passed out and available in the            
 committee packet.                                                             
 REPRESENTATIVE JAMES said a fiscal note, prepared for the highway             
 use fund, changing $21 million from general fund to the highway               
 fund, should incorporate the total amount being received from                 
 marine fuels from the general fund to the transportation fund.                
 Number 2200                                                                   
 CHAIRMAN GARY DAVIS said he would like to pass CSHJR 49(TRA) with             
 the understanding that an updated fiscal note is requested.  He               
 then asked Mr. Kito if the definition of maintenance and operating            
 cost was clearly understood in CSHJR 49(TRA).                                 
 Number 2222                                                                   
 MR. KITO felt it was clearly understood, but added the definition             
 of items, funded by this dedicated fund, could be clarified under             
 Number 2234                                                                   
 REPRESENTATIVE BRICE said, as he understood Mr. Dillon's concern,             
 that a statute could be developed allowing CSHJR 49(TRA) more                 
 expenditures to be used for the administrative costs of DOT/PF                
 versus direct maintenance.                                                    
 Number 2258                                                                   
 MR. KITO said the language, as worded in CSHJR 49(TRA), would have            
 to include some direct relationship to maintenance of the highway             
 Number 2271                                                                   
 REPRESENTATIVE BRICE said by definition, Mr. Kito's and the                   
 commissioners salary can be attributable to maintenance costs.  He            
 suggested tightening the language of CSHJR 49(TRA).                           
 Number 2298                                                                   
 CHAIRMAN GARY DAVIS asked if the administration could allocate a              
 portion of their time under the language of CSHJR 49(TRA).                    
 Number 2309                                                                   
 MR. KITO said the only place the DOT/PF has any type of cost                  
 allocation is in the federal highway funding.  He said DOT/PF tries           
 to build a federal highway department for whatever costs the                  
 department can, so within the DOT/PF a figure is made and                     
 incorporated into that budget.  In regards to maintenance, the                
 realistic approach would not include DOT/PF administrate costs                
 within that budget.  He said the accounting procedures involved               
 would be tremendous.                                                          
 Number 2338                                                                   
 REPRESENTATIVE JAMES said, in accounting principles, that                     
 maintenance would include any appropriate administrative or other             
 costs that directly related to the maintenance.  She expressed                
 concern over the openness of such language.                                   
 TAPE 96-6, SIDE B                                                             
 Number 000                                                                    
 REPRESENTATIVE JAMES said taking operating costs out of CSHJR
 49(TRA), makes it perfectly clear and that the legislature is not             
 intending to allow administrative costs relating to roads and                 
 highways out of this fund.  She added that statutes could be added            
 to define what the maintenance definition covers.                             
 Number 029                                                                    
 REPRESENTATIVE JAMES made a motion to delete, page two, line two,             
 "or operating costs".  Hearing no objections this deletion was made           
 to CSHJR 49(TRA).                                                             
 Number 046                                                                    
 REPRESENTATIVE JAMES expressed concern about combining the marine             
 fuel tax with the highway fuel tax.  She said this inclusion might            
 gain support in some areas, but lose support in others.                       
 Number 061                                                                    
 REPRESENTATIVE WILLIAMS made a motion to move CSHJR 49(TRA) amended           
 from committee with individual recommendations and the attached to-           
 be-amended fiscal note.  Hearing no objections, CSHJR 49(TRA) was             
 moved from the House Standing Committee on Transportation.                    
 HB 498-BETTY CATO BRIDGE IN VALDEZ                                         
 Number 084                                                                    
 CHAIRMAN GARY DAVIS announced that the committee would next address           
 HB 498.  He said in discussion with Representative Kubina, he                 
 agreed that he would submit HB 498 as a transportation bill.                  
 Number 137                                                                    
 SHERI CAPLES, Valdez City Council, testified via teleconference               
 from Valdez.  She said Ms. Cato was instrumental in the                       
 construction of the bridge over Mineral Creek.  It was through Ms.            
 Cato's support of a grant proposal awarded by the state of Alaska             
 that the bridge was built.  In August of 1995, the Valdez City                
 Council took action to dedicate the bridge to Ms. Bette Cato, a               
 plaque was made and a dedication ceremony will be held in June of             
 Number 158                                                                    
 REPRESENTATIVE GENE KUBINA said Ms. Cato's part in the development            
 of this bridge opened up a whole new section of the community of              
 Valdez.  He added that Ms. Cato knew and was excited about                    
 dedication and the plaque.  He thanked the transportation committee           
 for officially submitting HB 498.                                             
 CHAIRMAN GARY DAVIS said any minutes or any resolution from the               
 city of Valdez would be the only information needed to settle the             
 REPRESENTATIVE KUBINA said he would get this information.                     
 Number 240                                                                    
 REPRESENTATIVE BRICE made a motion to move HB 498 with accompanying           
 fiscal note and individual recommendations.  Hearing no objections            
 HB 498 was moved from the House Standing Committee on                         
 REPRESENTATIVE JAMES said, as it was Chairman Gary Davis' bill, she           
 would entertain a request to waive HB 498 from the House Standing             
 State Affairs Committee.                                                      
 HB 517-MOTOR VEHICLES: REGULATION & INSURANCE                              
 Number 268                                                                   
 CHAIRMAN GARY DAVIS announced that HB 517 was next on the agenda.             
 He said he did not intend to move HB 517 today and drew the                   
 committee's attention to amendments that have been submitted for              
 committee review.                                                             
 Number 312                                                                    
 SANDY PARR-PROVOST, Special Assistant, Office of the Commissioner,            
 Department of Public Safety, said that Jay Dulany would provide               
 information on HB 517.                                                        
 Number 329                                                                    
 JAY N. DULANY, Director, Central Office, Division of Motor                    
 Vehicles, Department of Public Safety, testified via teleconference           
 from Anchorage.  He said he would provide a brief overview on what            
 HB 517 would do.  He said the most important aspect of HB 517 is              
 the commercial motor vehicle provisions.  (Indiscernible due to               
 coughing).."approximately $22 million in highway construction funds           
 and to a lesser amount for commercial vehicle enforcement."  He               
 said the state needs to disqualify commercial drivers for                     
 violations of service orders and to bring other provisions of the             
 states commercial vehicle laws into compliance with federal                   
 requirements.  He said Sergeant Bob Brown would address the                   
 enforcement issues and mentioned that there were a number of                  
 sections that deal with these provisions.                                     
 Number 380                                                                    
 MR. DELANY said the other sections further the efficiency measures            
 within the Division of Motor Vehicles (DMV).  HB 517 allows the DMV           
 to officially use electronic records in essentially the same manner           
 as paper records.  HB 517 authorizes telephone hearings in lieu of            
 in-person hearings for administrative hearings to save                        
 transportation costs.  HB 517 increases the motor vehicle dealer              
 temporary permit from 30 to 60 days giving adequate time to the               
 dealers and their customers for title processing especially in                
 circumstances when it is an out-of-state title or lien.                       
 Number 408                                                                    
 MR. DELANY said HB 517 also removes some restrictions for renewing            
 a driver's license by mail and increases the property damage                  
 threshold to $1500 for financial responsibility and for mandatory             
 insurance reporting purposes.  He said, finally, that HB 517                  
 repeals the legislative section of statute that set up the original           
 staggered registration system back in 1978.                                   
 Number 438                                                                    
 CHAIRMAN GARY DAVIS remarked that federal funds are in jeopardy               
 unless the state of Alaska comes into compliance with regulations.            
 Number 450                                                                    
 MR. DELANY said if those commercial motor vehicle provisions are              
 not in place by October of 1996, then the state does tend to lose             
 substantial highway construction funds and potentially the Motor              
 Carrier Safety Action fund as well, which is up to $20 million.               
 Number 469                                                                    
 REPRESENTATIVE JAMES referred to a letter in the committee packet             
 from a Donald B. Harris, and asked if a provision mentioned was               
 going to be addressed.                                                        
 CHAIRMAN GARY DAVIS said yes, it was, and added that one of the               
 committee members had expressed a concern for the change from 300             
 miles to 150 miles.                                                           
 REPRESENTATIVE JAMES expressed concern over this provision as well            
 and suggested that a waiver be requested.  She said that 300 miles            
 is appropriate distance within Alaska.                                        
 Number 505                                                                    
 CHAIRMAN GARY DAVIS began to clarify the provision being discussed            
 to Mr. Delany when he received a note saying that Trooper Brown               
 would address this provision.                                                 
 Number 566                                                                    
 MR. DELANY said in the original commercial drivers license                    
 legislation located in the Alaskan statutes, set the mileage factor           
 at 150 miles.  He said he didn't feel that this is an issue in                
 regards to safety inspections as this is the only issue covered by            
 the 300 mile exemption.                                                       
 Representative Masek joined the committee meeting at 2:43 p.m.                
 REPRESENTATIVE JAMES said her concern was in the drivers license,             
 but added that it is another issue which she would address                    
 Number 593                                                                    
 CHAIRMAN GARY DAVIS referred to the sectional analysis and was told           
 that Sections 1,2,3,5,9-15,6,8,22,23 are all housekeeping measures.           
 Number 639                                                                    
 BRAD BROWN, Central Office, Division of Alaska State Troopers,                
 Department of Public Safety, testified via teleconference from                
 Anchorage.  He referred to a question regarding the variance of 150           
 miles versus 300 miles.  He said the state attempted to obtain a              
 variance, but was turned down.  He added the state applies for                
 federal money under the guidance of the federal code of                       
 regulations, Title 49, Part 350.  Part 350 stipulates that the                
 state of Alaska needs to be in compliance with the federal motor              
 carrier standards.  He said the state is out of compliance                    
 primarily with the verbiage of 300 miles versus 150 miles.  He                
 said, to this date, the enforcement unit has not encountered a                
 problem per se of 150 miles versus 300 miles.  He said the language           
 must be changed in order for the state to continue receiving                  
 federal funding.                                                              
 Number 695                                                                    
 MR. BROWN referred to a letter from the Alaska Division Program               
 Specialist of the Office of Motor Carriers, this letter indicated             
 that the state is subject to losing at least 50 percent of the                
 states grant for the commercial vehicle enforcement unit as a                 
 result of non-compliance with Part 350.  He said this loss is                 
 subject to immediate implementation because the state has been out            
 of compliance ever since the law was initially past, years ago.               
 Number 719                                                                    
 REPRESENTATIVE JAMES said she had no contention with the safety               
 inspections and in fact encouraged them.  She expressed her concern           
 over the commercial licenses and because she was told that this was           
 already in affect, she had no concern with this issue.                        
 Number 753                                                                    
 JOE CRUM, Director of Training, Center for Employment Education               
 (CEE), testified via teleconference from Anchorage.  He said his              
 company is the only authorized and licensed commercial driving                
 school in the state of Alaska.  He said a week ago, Mark Johnson,             
 the president of CEE, testified before the House State Affairs                
 Committee.  At that time Mr. Crum was told CEE should seek a                  
 different bill in which to address their concerns and offer                   
 recommendations and Mr. Crum stated that this was his purpose today.          
 MR. CRUM asked for HB 517 to be amended, or a section be added,               
 placing stricter penalties on would-be personal truck driver                  
 trainers who fail to meet the standards set forth by the state to             
 operate this type of training.                                                
 Number 800                                                                    
 MR. CRUM said CEE has invested nearly $500,000 to develop a program           
 that meets the minimal proposed national standards.  He said CEE is           
 licensed and bonded with instructors who have received formal                 
 training, extensive background checks, have been finger printed and           
 tested and eventually licensed by DMV.  The facility and equipment            
 has been inspected by both DMV and post secondary education.  CEE             
 has expended effort to follow the standards set forth by state and            
 federal laws to comply with established guidelines to open CEE.               
 The CEE has discovered a number of organizations which have not               
 complied with those standards and are being allowed to operate                
 within the state of Alaska.                                                   
 Number 845                                                                    
 MR. CRUM said complaints regarding those organizations were                   
 submitted to DMV and post secondary education.  The DMV issued                
 cease and desist orders to all known violators, but these violators           
 are still in business today.  He said an on going investigation is            
 being conducted by the Alaska State Troopers, but he was unaware of           
 the investigations status.  He said the organizations do not have             
 instructional licenses for the company or the instructors and added           
 that some instructors do not have commercial drivers licenses.  He            
 said the students are not made to follow any guidelines for safety            
 and these organizations do not even have minimum instructional                
 course permits which allows the students to receive driver training           
 on the streets.                                                               
 MR. CRUM read a letter reply from a current violator, this letter             
 was directed to the Driver Improvement Officer, and says, "just               
 what I need a nosey neighbor and another bureaucrat sticking his              
 nose into my business.  The straight facts are that I rented trucks           
 for people to take drivers test in, that is a necessity.  I show              
 each one enough about the truck to be safe and familiar in."  Mr.             
 Crum said the organizations spend days and weeks showing students             
 how to be familiar with the vehicles.  He continued reading from              
 the letter, "while warning them that most fail on the walk around."           
 He said CEE has a 100 percent passing on this part, with no one               
 failing on the walk around.  The letter goes on to say, "we also              
 drive the truck to the test point as they are not legally able to.            
 If you interpret this as training, you are mistaken.  Please don't            
 clutter up my time or my mail with any more unsolicited packets to            
 explain state law to me.  Truly you can find better use of your               
 time, as for me I will continue on trying to eke out a living and             
 help my fellow man as the occasion arises."  He said of all the               
 replies received from the state cease and desist letters, this is             
 one of the more tame examples.                                                
 Number 956                                                                    
 MR. CRUM said one Anchorage company trained and provided equipment            
 for commercial driver license tests to an astonishing 700 people              
 within the last two years.  A Fairbanks operator is guilty of over            
 400 similar violations and yet still refuses to comply with the set           
 standards.  Others, when they are told of the requirements needed             
 to operate legally, decline to do so.  He referred to                         
 (indiscernible due to coughing) federal highway administration's              
 study of truck driver training advocacy.  This study has been going           
 on for about two years by federal, state and private companies to             
 assist with decreasing truck driver accident rates.                           
 Number 999                                                                    
 MR. CRUM, referring to the study, said only 8.1 percent of motor              
 carriers hiring entry level drivers provide adequate training for             
 those drivers.  Of the students trained by proprietary and public             
 schools, like CEE, only 25.5 percent are adequately trained on a              
 national survey.  Mr. Crum added that 97.8 percent of students                
 taught at CEE passed the DMV commercial drivers license test the              
 first time.  Students trained by the illegal competitors usually              
 needed to take the test three or four times on average.  He                   
 concluded that stricter penalties need to be imposed for those who            
 fail to obey the law.  He said there is not a substantial penalty             
 or otherwise these organizations would stop operating outside the             
 law.  He suggested a minimum $5,000 fine per violation, in lieu of            
 the $100 fine currently in place, to raise the standards for heavy            
 haulers and penalize those who operate outside the law.                       
 Number 1066                                                                   
 MR. CRUM said he supported HB 517 with the addition of this                   
 proposed amendment.                                                           
 CHAIRMAN GARY DAVIS said HB 517 would be held in committee and                
 asked him to send information centered around this request.                   
 Number 1104                                                                   
 MR. DELANY said the situation described by Mr. Crum is absolutely             
 true.  He said an attempt was made, when it was discovered that               
 there were schools operating outside of the statutes, to make them            
 stop.  He said this situation was turned over to the State Troopers           
 to obtain evidence.  He said, that even if those schools are found            
 to be in violation and were convicted of the offense, it is a                 
 misdemeanor and doesn't affect them economically and they would               
 probably continue to operate.                                                 
 REPRESENTATIVE JAMES asked what standards are listed for                      
 instruction to obtain a commercial drivers license in the Alaska              
 Number 1181                                                                   
 MR. DELANY said there were some commercial driver school statutes             
 and also some regulations that were promulgated as a result of                
 those statutes.  He said he does not have any objection to the                
 proposed provision incorporated into HB 517.                                  
 Number 1219                                                                   
 MR. DILLON said he is also a member of the board for CEE since its            
 conception.  He said it has been difficult to set up their business           
 when there is competition from people who do not comply with the              
 rules and regulations.  He said if you are not going to comply with           
 the rules, there should be some sanctions that make sense.  He                
 concluded that he would encourage support of this legislation.                
 Number 1265                                                                   
 MR. DILLON said HB 517 includes things that his organization has              
 been advocating for over a number of years to bring the state into            
 compliance with the federal regulations and gives the state one set           
 of regulations to operate from.  He said the greatest difficulties            
 occur, in the operational sense and in terms of safety regulations,           
 when there are conflicting regulations and statutes.  The federal             
 government has reminded the state of Alaska continually that we are           
 out of compliance and facing sanctions.  He said Alaska could be              
 the state that the federal government makes an example to the rest            
 of the country.  He encouraged the passage of HB 517.                         
 Number 1323                                                                   
 STEVE ALLWINE, Alaska Auto Dealers Association, was next to                   
 testify.  He said he was in support of HB 517, especially page two,           
 Section 3, line 20 through 22, dealing with temporary permit of               
 vehicles.  He said this section has created problems with                     
 automobile dealers, customers and DMV.  He said it has the                    
 perception of the association that the DMV has been severely                  
 understaffed and underfunded for the last number of years, and                
 although this segment of HB 517 does not provide for additional               
 staffing, it is believed that this segment will assist the DMV                
 staff, automobile dealers, and general public to do the work in a             
 timely manner.  He encouraged the committee to retain Section 3.              
 CHAIRMAN GARY DAVIS clarified that Section 3 relates to any vehicle           
 that is sold.                                                                 
 As there was no further business to come before the House                     
 Transportation Standing Committee, Chairman Gary Davis adjourned              
 the meeting at 3:00 p.m.                                                      

Document Name Date/Time Subjects