Legislature(1999 - 2000)

09/23/1999 08:40 AM Senate BUD

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
                      JOINT COMMITTEE                                                                                           
                LEGISLATIVE BUDGET AND AUDIT                                                                                    
                     September 23, 1999                                                                                         
                         8:40 A.M.                                                                                              
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Gail Phillips, Chair                                                                                             
Representative Con Bunde                                                                                                        
Representative Eric Croft                                                                                                       
Representative Gary Davis                                                                                                       
Representative Gene Therriault                                                                                                  
Representative Eldon Mulder (alternate)                                                                                         
                                                                                                                                
Senator Randy Phillips, Vice Chair                                                                                              
Senator Al Adams                                                                                                                
Senator Rick Halford                                                                                                            
Senator Sean Parnell                                                                                                            
Senator Gary Wilken                                                                                                             
Senator Drue Pearce (alternate)                                                                                                 
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
APPROVAL OF PREVIOUS MINUTES                                                                                                    
     August 10, 1999                                                                                                            
REVISED PROGRAMS (RPL's)                                                                                                        
EXECUTIVE SESSION                                                                                                               
     Preliminary Audit Reports                                                                                                  
     Final Audit Reports                                                                                                        
AUDIT REPORTS                                                                                                                   
     Release of Final Audits                                                                                                    
     Consideration of Audit Reports                                                                                             
OTHER COMMITTEE BUSINESS                                                                                                        
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
TOM MAHER, Legislative Assistant                                                                                                
     to Representative Gail Phillips                                                                                            
Alaska State Legislature                                                                                                        
Capitol Building, Room 411                                                                                                      
Juneau, Alaska  99801                                                                                                           
Telephone:  (907) 465-6873                                                                                                      
                                                                                                                                
DAVID TEAL, Director                                                                                                            
Division of Legislative Finance                                                                                                 
State Office Building, Sixth Floor                                                                                              
Juneau, Alaska  99811                                                                                                           
Telephone:  (907) 465-3795                                                                                                      
POSITION STATEMENT:  Introduced the RPL's                                                                                       
                                                                                                                                
PAT DAVIDSON, Director                                                                                                          
Division of Legislative Audit                                                                                                   
State Office Building, Sixth Floor                                                                                              
Juneau, Alaska  99801                                                                                                           
Telephone:  (907) 465-3830                                                                                                      
POSITION STATEMENT:  Spoke to the Audit Reports                                                                                 
                                                                                                                                
MERLE JENSEN, Deputy Legislative Auditor                                                                                        
Division of Legislative Audit                                                                                                   
State Office Building, Sixth Floor                                                                                              
Juneau, Alaska  99801                                                                                                           
Telephone:  (907) 465-3820                                                                                                      
                                                                                                                                
NICO BUS, Administrative Services Manager                                                                                       
Division of Support Services                                                                                                    
Department of Natural Resources                                                                                                 
400 Willoughby Avenue, 5th Floor                                                                                                
Juneau, Alaska  99801-1724                                                                                                      
Telephone:  (907) 465-2406                                                                                                      
POSITION STATEMENT: Spoke to the Department RPL's                                                                               
                                                                                                                                
NANCY SLAGLE, Director                                                                                                          
Division of Administrative Services                                                                                             
Department of Transportation and Public Facilities                                                                              
3132 Channel Drive                                                                                                              
Juneau, Alaska  99801-7898                                                                                                      
Telephone:  (907) 465-3911                                                                                                      
POSITION STATEMENT: Spoke to RPL #25-0-6200                                                                                     
                                                                                                                                
CAROL TAYLOR, Planner                                                                                                           
Division of Statewide Planning                                                                                                  
Department of Transportation and Public Facilities                                                                              
3132 Channel Drive                                                                                                              
Juneau, Alaska  99801-7898                                                                                                      
Telephone:  (907) 465-4070                                                                                                      
POSITION STATEMENT:  Spoke to RPL #25-0-6200                                                                                    
                                                                                                                                
BARBARA RITCHIE, Deputy Attorney General                                                                                        
Office of the Attorney General                                                                                                  
Department of Law                                                                                                               
PO Box 110300                                                                                                                   
4th Floor, Dimond Courthouse                                                                                                    
Juneau, Alaska  99811-0300                                                                                                      
Telephone:  (907) 465-2133                                                                                                      
                                                                                                                                
THOMAS DAHL, Assistant Attorney General                                                                                         
Human Services Section                                                                                                          
Department of Law                                                                                                               
PO Box 110300                                                                                                                   
5th Floor, Dimond Courthouse                                                                                                    
Juneau, Alaska  99811-0300                                                                                                      
(907) 465-3600                                                                                                                  
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
TAPE 99-6, SIDE A                                                                                                               
                                                                                                                                
CHAIR   GAIL  PHILLIPS   called   the   Joint  Committee   on                                                                   
Legislative Budget  and Audit meeting  to order at  8:40 A.M.                                                                   
on September 23, 1999.  Members  present at the call to order                                                                   
were Representatives  Phillips, Croft, G.  Davis, Therriault,                                                                   
Mulder  and Senators  Phillips,  Adams,  Wilken, and  Pearce.                                                                   
Representative  Bunde   and  Senators  Halford   and  Parnell                                                                   
arrived later during the meeting.  (time not noted).                                                                            
                                                                                                                                
APPROVAL OF MINUTES                                                                                                           
                                                                                                                                
CHAIR PHILLIPS  announced  that the first  order of  business                                                                   
would  be  the  approval  of minutes  from  the  August  10th                                                                   
Legislative Budget and Audit Committee meeting.                                                                                 
                                                                                                                                
SENATOR PHILLIPS MOVED approval  of the minutes and asked for                                                                   
unanimous  consent.   There being NO  OBJECTION, the  minutes                                                                   
were approved and adopted.                                                                                                      
                                                                                                                                
REVISED PROGRAMS (RPL's)                                                                                                      
                                                                                                                                
DAVID  TEAL explained  the  RPL's  before the  Committee  for                                                                   
review and action.                                                                                                              
                                                                                                                                
RPL Number:    02-0-0026                                                                                                      
                                                                                                                                
Department of Administration                                                                                                    
Senior Services BRU                                                                                                             
Home and Community Based Care Component                                                                                         
                                                                                                                                
$28,900 MHTAAR - Operating                                                                                                    
                                                                                                                                
DAVID  TEAL explained  that  the funding  would  be used  for                                                                   
temporary  relocation of  the Bridge  Adult Day Program  from                                                                   
the Mountain  View/Juneau Senior  Center to the  Twisted Fish                                                                   
Company Restaurant.   The program,  with 4-5 full  time staff                                                                   
and  an  average   of  20  clients,  provides   a  structured                                                                   
therapeutic day program for frail  and disabled people of any                                                                   
age who have Alzheimer's Disease and related disorders.                                                                         
                                                                                                                                
Mr. Teal  continued that the  relocation is necessary  due to                                                                   
an  Alaska  Housing  Finance   Corporation  (AHFC)  initiated                                                                   
remodel  of the  Mountain  View/Juneau  Senior  Center.   The                                                                   
remodel is  necessary to  bring the building  up to  code and                                                                   
that the Twisted Fish restaurant is ADA compliant.                                                                              
                                                                                                                                
The  Mental Health  Trust Authority  awarded  these funds  on                                                                   
July 15th, 1999.  AHFC will be  paying for all the remodeling                                                                   
costs  and some  of  the relocation  costs  of that  project.                                                                   
Catholic  Community   Services  will  be   providing  $11,900                                                                   
dollars.    The requested  RPL  would  cover the  balance  of                                                                   
costs.                                                                                                                          
                                                                                                                                
SENATOR ADAMS  MOVED to adopt  the requested funding.   There                                                                   
being NO OBJECTION, RPL #02-0-0026 was adopted.                                                                                 
                                                                                                                                
RPL Number:    10-0-4013                                                                                                      
                                                                                                                                
Department of Natural Resources                                                                                                 
Information/Data Management BRU                                                                                                 
Information Resource Management Component                                                                                       
                                                                                                                                
$310,000 Federal - Operating                                                                                                  
                                                                                                                                
DAVID TEAL commented  that the requested funds  would be used                                                                   
for  the development  of a  modern digital  mining claim  and                                                                   
land information system that includes  both State and federal                                                                   
mining  claims, and  bridges  isolated  land record  systems.                                                                   
The  multiple  agency  systems having  no  electronic  cross-                                                                   
reference currently make it difficult  to obtain information.                                                                   
Statewide access  to past and  future mining claims  and land                                                                   
record databases will  be improved with the new  system.  The                                                                   
Department would be the lead agency on the project.                                                                             
                                                                                                                                
Mr. Teal  continued, on August  14th, 1998, LBA  approved RPL                                                                   
10-9-4002  for  $125,000  federal  dollars  to  initiate  the                                                                   
project.  The requested amount  would supplement the original                                                                   
funding.                                                                                                                        
                                                                                                                                
The request  was not included  in the FY00 budget  because at                                                                   
the time,  the specifics  were  not known.   There should  be                                                                   
requests  included in  the  FY01 and  FY02  budgets and  that                                                                   
there would  be no impact on  general funds.  Mr.  Teal noted                                                                   
that $150 thousand  dollars of the request would  be spent on                                                                   
personal  services (current  positions).    The funding  will                                                                   
bring the vacancy factor back down to 5.5%.                                                                                     
                                                                                                                                
REPRESENTATIVE  MULDER asked  if the  positions saved  by the                                                                   
proposed    funding    request     would    have    different                                                                   
responsibilities  than  those  positions  lost  in  the  FY00                                                                   
operating budget cut.                                                                                                           
                                                                                                                                
NICO BUS explained that those  personnel would have been laid                                                                   
off, regardless.   The proposed project tries  to consolidate                                                                   
State and federal  records.  The employees  would be handling                                                                   
different  functions   by  incorporating  the   mining  claim                                                                   
records,  using   the  newly  purchased  equipment   to  make                                                                   
information  more  readily  available  to  the  public.    He                                                                   
stressed that the mining community  is very supportive of the                                                                   
project.                                                                                                                        
                                                                                                                                
SENATOR PHILLIPS questioned how  the Department could justify                                                                   
the request given the status of the advisory vote.                                                                              
                                                                                                                                
NICO BUS  responded that  the decision would  be left  to the                                                                   
LBA  Committee.   He added  that  economic development  takes                                                                   
State financial effort to automate.                                                                                             
                                                                                                                                
REPRESENTATIVE  G. DAVIS  asked  if the  requested  positions                                                                   
would be middle management hires.                                                                                               
                                                                                                                                
SENATOR PHILLIPS interjected that  a partial part of the "no"                                                                   
vote was  to reduce the size  of government.  He  pointed out                                                                   
that  the proposed  RPL was  the  bureaucury requesting  more                                                                   
positions  with federal funds.   He  suggested that  the "no"                                                                   
vote should be  recognized.  Senator Phillips  commented that                                                                   
he was  determined to  take a more  "hard line@ view  of such                                                                   
proposals.                                                                                                                      
                                                                                                                                
REPRESENTATIVE  BUNDE  advised   that  each  time  the  State                                                                   
receives  money  from  the  federal   government,  the  State                                                                   
"suffers"  by  passing  it.     He  echoed  Senator  Phillips                                                                   
concerns.                                                                                                                       
                                                                                                                                
SENATOR ADAMS  commented that his interpretation  of the "no"                                                                   
vote was  different from his  colleagues.  He  suggested that                                                                   
if Anchorage wants  to have cuts, they should  be given those                                                                   
cuts.   The  rest  of  the State  is  not  saying that.    He                                                                   
believed  that the  rest of  the State  would like  to see  a                                                                   
different  plan than  that proposed  in  September.   Senator                                                                   
Adams  suggested  that  the  merits   of  the  debate  should                                                                   
incorporate  mining  and  development   economic  status  for                                                                   
Alaska.                                                                                                                         
                                                                                                                                
SENATOR  PHILLIPS  inquired  where  the  positions  would  be                                                                   
located.                                                                                                                        
                                                                                                                                
NICO BUS responded that they were located in Anchorage.                                                                         
                                                                                                                                
REPRESENTATIVE THERRIAULT asked  if the funding request would                                                                   
cover only the current fiscal year.                                                                                             
                                                                                                                                
NICO BUS explained  that in last year=s project,  the federal                                                                   
government  funded $450  thousand dollars.   The  RPL is  for                                                                   
$310 thousand  dollars  which would be  carried forward  into                                                                   
FY01 for $140 thousand dollars.                                                                                                 
                                                                                                                                
REPRESENTATIVE  THERRIAULT asked  if  the federal  government                                                                   
had been  approached after the  State's operating  budget was                                                                   
completed.                                                                                                                      
                                                                                                                                
NICO BUS  replied that the  Department had been  working with                                                                   
the mining  community and the  federal government for  a long                                                                   
time  to streamline  the system.    The proposed  RPL is  the                                                                   
resulting product.   The federal  government was not  sure if                                                                   
they   would   continue  funding   this   project,   however,                                                                   
correspondence  in June provided  one more allocation  in the                                                                   
amount of $450 thousand dollars  to implement the next phase.                                                                   
                                                                                                                                
REPRESENTATIVE  MULDER  questioned   the  length  of  federal                                                                   
appropriation anticipated by the Department.                                                                                    
                                                                                                                                
NICO BUS  replied that  the remaining  $140 thousand  dollars                                                                   
would be carried into FY01.                                                                                                     
                                                                                                                                
REPRESENTATIVE  MULDER asked  if  the Department  anticipated                                                                   
the  new  hired  positions  to be  "gone"  after  a  two-year                                                                   
period.                                                                                                                         
                                                                                                                                
NICO BUS responded  that those positions would  be gone after                                                                   
completion of this specific project.                                                                                            
                                                                                                                                
REPRESENTATIVE  CROFT commented  on his  frustration that  an                                                                   
alternative  had not  been presented  to the  public for  the                                                                   
advisory vote.  He noted that  there has been a lot of "talk"                                                                   
regarding resource development  as a "way out" of the State's                                                                   
bleak financial situation.  The  proposed RPL would provide a                                                                   
way, without  spending  State general  funds, to move  toward                                                                   
resource  extraction,  economic  development  and  additional                                                                   
jobs.   Representative  Croft acknowledged  that the  task of                                                                   
determining the  "no" vote indication would be  difficult for                                                                   
Alaska.                                                                                                                         
                                                                                                                                
SENATOR  PHILLIPS countered  that  part of  the $100  million                                                                   
dollar   revenues  and   the  proposal   were  part   of  the                                                                   
conditions.                                                                                                                     
                                                                                                                                
REPRESENTATIVE  G. DAVIS questioned  if the RPL  would expand                                                                   
economic development  opportunities or  would it  add current                                                                   
mining claims easier access to that information.                                                                                
                                                                                                                                
NICO BUS replied  that it would address both the  old and the                                                                   
new claims.                                                                                                                     
                                                                                                                                
REPRESENTATIVE BUNDE understood  that the mining industry and                                                                   
resource development, return approximately  20% of the actual                                                                   
cost to the State, to provide this service.                                                                                     
                                                                                                                                
NICO  BUS  did not  believe  that  amount  was correct.    He                                                                   
suggested that  the impact  was greater to  the economy.   He                                                                   
offered to provide those statistics to the Committee.                                                                           
                                                                                                                                
REPRESENTATIVE BUNDE  interjected that it was  fair to assume                                                                   
that there  was not a net gain.   He projected that  the only                                                                   
resource, which does not cost the State more, is oil.                                                                           
                                                                                                                                
NICO  BUS  replied  that  could only  be  determined  by  the                                                                   
definition  of  "net  gain".     If  the  understanding  were                                                                   
employment for  the Alaskan  citizens, this request  provides                                                                   
that.                                                                                                                           
                                                                                                                                
REPRESENTATIVE THERRIAULT commented  that the Fairbanks North                                                                   
Star Borough did  an economic impact analysis  and determined                                                                   
that the mining industry was one  of the largest property tax                                                                   
payers  in  that  borough.    He  emphasized  the  tremendous                                                                   
benefit of that service to our State.                                                                                           
                                                                                                                                
REPRESENTATIVE MULDER asked if  the RPL would allow the State                                                                   
to look at federal lands for potential claims.                                                                                  
                                                                                                                                
NICO  BUS  replied that  the  State  can currently  do  that,                                                                   
however, that  information is found in two  different places.                                                                   
The proposal would provide consolidation.                                                                                       
                                                                                                                                
SENATOR ADAMS  MOVED to adopt  the requested RPL  #10-0-4013.                                                                   
SENATOR PHILLIPS OBJECTED.                                                                                                      
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR:      Representatives Phillips, Croft, G. Davis,                                                                       
               Therriault and  Mulder (alternative)                                                                             
               Senators Adams, Wilken, Pearce (alternative)                                                                     
OPPOSED:       Representative Bunde                                                                                             
               Senator Phillips                                                                                                 
                                                                                                                                
Senators Halford and Parnell were not present for the vote.                                                                     
                                                                                                                                
The MOTION PASSED (7-2).                                                                                                        
                                                                                                                                
RPL Number:    10-0-4014                                                                                                      
                                                                                                                                
Department of Natural Resources                                                                                                 
Mining, Geological, Water Development BRU                                                                                       
Geological Development Component                                                                                                
                                                                                                                                
$400,000 Federal - Capital                                                                                                    
                                                                                                                                
DAVID TEAL explained that the  request was an amendment to an                                                                   
existing capital  project.  The  federal funds  are available                                                                   
from the U.S.  Bureau of Land Management (BLM)  to conduct an                                                                   
airborne  geophysical survey  of parts  of the Sleetmute  and                                                                   
Iditarod Quadrangles  in southwestern Alaska.   He added that                                                                   
the Department  would  procure and manage  a survey  contract                                                                   
according to specifics  in a cooperative agreement  with BLM.                                                                   
The products of  the survey are expected to  catalyze mineral                                                                   
exploration and development of the survey area.                                                                                 
                                                                                                                                
Mr. Teal  pointed out that  the existing capital  project for                                                                   
an  Airborne Geophysical  and  Geophysical Mineral  Inventory                                                                   
was initiated with $400 thousand  general fund dollars during                                                                   
last  legislative  session.     BLM  signed  the  cooperative                                                                   
agreement on September 13th, 1999.   The funds will expire on                                                                   
October  1, 1999  if  not encumbered  by  the  State for  the                                                                   
project.  The  Department did not include the  new funding in                                                                   
the  FY00 budget  because availability  was  not known  until                                                                   
July 1, 1999.                                                                                                                   
                                                                                                                                
Mr.  Teal continued,  the projected  completion  date of  the                                                                   
project is September 30, 2000  and there will be no impact on                                                                   
the general  fund.  He noted  that no new positions  would be                                                                   
requested for this project.                                                                                                     
                                                                                                                                
SENATOR PEARCE questioned if a contract already existed.                                                                        
                                                                                                                                
NICO BUS responded that the entire  project would be contract                                                                   
work for  the helicopter time to  fly into those areas.   The                                                                   
areas contracted  for last session  will be worked on  in the                                                                   
spring.   He added that the  work would basically be  done on                                                                   
federal land with federal money.   The federal government has                                                                   
requested that the Department  administer their contract over                                                                   
their land.                                                                                                                     
                                                                                                                                
SENATOR PEARCE  questioned if  the size will expanded,  would                                                                   
it  run as  a separate  contract.   She asked  if that  would                                                                   
create additional efficiency.                                                                                                   
                                                                                                                                
NICO BUS  advised that  efficiency exists  as the  Department                                                                   
has run the program for the last  seven years and understands                                                                   
the routine.   All that will  be required is changing  of the                                                                   
actual geographic location and analysis of the data.                                                                            
                                                                                                                                
SENATOR PEARCE inquired who would own the data.                                                                                 
                                                                                                                                
NICO BUS  stated that the  federal government owns  the data,                                                                   
and that it is available to the public.                                                                                         
                                                                                                                                
SENATOR ADAMS  pointed out  that the  area affected  was that                                                                   
represented by Senator  Hoffman and that area  has the lowest                                                                   
employment  in  the  State.   Senator  Adams  asked  why  the                                                                   
Sleetmute and Iditarod survey was chosen for this RPL.                                                                          
                                                                                                                                
NICO  BUS  advised  that  the  federal  government  made  the                                                                   
choice, as it  was a combination of federal  and Native lands                                                                   
nominated.   Senator Stevens identified  these areas  and the                                                                   
federal government  put the  money up front  to the  State of                                                                   
Alaska.   The State  will benefit,  as there  are some  areas                                                                   
that are closely federal/State/Native lands.                                                                                    
                                                                                                                                
REPRESENTATIVE  THERRIAULT asked  if  the federal  government                                                                   
had a  specific project  in mind.   He  noted that the  money                                                                   
would lapse in a couple of weeks.                                                                                               
                                                                                                                                
NICO BUS replied  that he did not know the  source of federal                                                                   
money, but  thought that there  had been some  year-end lapse                                                                   
money made available for the project.                                                                                           
                                                                                                                                
SENATOR PHILLIPS asked  what would happen if the  RPL was not                                                                   
approved.                                                                                                                       
                                                                                                                                
NICO BUS stated that the project  would not be funded and the                                                                   
federal government would receive  $400 thousand dollars back.                                                                   
He added that there was a $10  thousand dollar administrative                                                                   
fee associated with the RPL.                                                                                                    
                                                                                                                                
SENATOR WILKEN MOVED to adopt RPL #10-0-4014.                                                                                   
                                                                                                                                
REPRESENTATIVE  BUNDE  OBJECTED.   He  asked  if these  funds                                                                   
would  be technically  counted as  State spending.   Mr.  Bus                                                                   
acknowledged they would.                                                                                                        
                                                                                                                                
REPRESENTATIVE  G.  DAVIS  clarified   that  it  would  be  a                                                                   
standard land survey.                                                                                                           
                                                                                                                                
NICO BUS explained the process  of picturing the land platted                                                                   
areas to determine good prospects for mining development.                                                                       
                                                                                                                                
REPRESENTATIVE  CROFT noted that  the employees would  not be                                                                   
federal or State workers; they  would all be private contract                                                                   
hires.  Mr. Bus agreed.                                                                                                         
                                                                                                                                
A roll call vote was taken on the motion.                                                                                       
                                                                                                                                
IN FAVOR:      Representatives Phillips, Croft, G. Davis,                                                                       
               Therriault, Mulder (alternate)                                                                                   
              Senators Halford, Wilken, Adams                                                                                   
               Pearce (alternate)                                                                                               
OPPOSED:       Representative Bunde                                                                                             
               Senator Phillips                                                                                                 
                                                                                                                                
Senator Parnell was not present for the vote.                                                                                   
                                                                                                                                
The MOTION PASSED (8-2).                                                                                                        
                                                                                                                                
RPL Number:    25-0-6200                                                                                                      
                                                                                                                                
Department of Transportation and Public Facilities                                                                              
AMATS Community Transportation                                                                                                  
     Cooperative Program (CTCP)                                                                                                 
                                                                                                                                
$250,000 Federal Receipts - Capital                                                                                           
                                                                                                                                
CHAIR GAIL  PHILLIPS noted that  the Department  had received                                                                   
authorization  last  session to  receive  these  funds.   She                                                                   
pointed out that  the request came to the LBA  Committee from                                                                   
the urging  of Senator  Donley.   She stressed  that the  RPL                                                                   
does not need approval.                                                                                                         
                                                                                                                                
Chair Phillips recommended that  the Committee take NO ACTION                                                                   
on the request.   She stated that  she did not want  to begin                                                                   
the practice  of bringing  RPL's forward  that does  not need                                                                   
the Committee's  approval.   It will  create excess  work for                                                                   
the  agencies  and  unnecessary  delays.   If  this  RPL  was                                                                   
approved, it would raise the question  of what the Department                                                                   
would use  the authority  for.  She  requested that  Mr. Teal                                                                   
explain the issue.                                                                                                              
                                                                                                                                
DAVID  TEAL  explained  that the  Municipality  of  Anchorage                                                                   
applied for and has been awarded,  a discretionary grant from                                                                   
the   Federal  Highway   Administration   (FHWA)  under   the                                                                   
Transportation  and   Community  System  Preservation   Pilot                                                                   
Program.    This  is  a  planning  grant  with  a  two-tiered                                                                   
approach.  Tier  I would re-design the  Municipality's public                                                                   
involvement process for the AMATS  Transportation Improvement                                                                   
Program.   Tier II would  apply the new process  specifically                                                                   
to a  significant transportation-planning  project,  the Ship                                                                   
Creek  Multimodal  Transportation   Plan.    The  anticipated                                                                   
product  is  a   stand-alone  program  that   the  AMATS  and                                                                   
Municipality's  Planning  Department  could apply  to  future                                                                   
planning  efforts  for  both   land  use  and  transportation                                                                   
issues.                                                                                                                         
                                                                                                                                
Mr. Teal  continued, the funding  was not anticipated  during                                                                   
the  regular  budget  process.     The  Municipality's  grant                                                                   
proposal competed  nationally  with other states'  proposals,                                                                   
and was awarded from FY99 special  discretionary funds.  This                                                                   
is  a one-time  request  and  the  funds are  available  now.                                                                   
Notification  of the award  was received  June 18,  1999, via                                                                   
signed  federal aid agreement  and no  expenditures have  yet                                                                   
been  made.    The  funds,  however,  must  be  obligated  by                                                                   
September 30,  1999, before the  close of the  federal fiscal                                                                   
year.  If  the RPL is not  approved now, the  Municipality of                                                                   
Anchorage will  lose the grant.   He added that the  grant is                                                                   
100% federally funded and that  there are no implications for                                                                   
positions, indirect cost recoveries or efficiency measures.                                                                     
                                                                                                                                
Mr.  Teal noted  the  two  letters distributed  to  Committee                                                                   
members  addressing the  RPL.   [Copies on  File].  He  noted                                                                   
that what exists is an RPL, which  the Department intended to                                                                   
proceed on  without a request  because of broad  authority in                                                                   
the budget.   He commented  that he  could not speak  for the                                                                   
Department, however,  when money is used, not  in the budget,                                                                   
it removes funds from projects  supposedly allocated for.  He                                                                   
acknowledged that  one could argue  that this RPL  could take                                                                   
from a  later RPL  or could  provide a  project that  did not                                                                   
come before the Committee.                                                                                                      
                                                                                                                                
SENATOR PEARCE  stated that as  Senator Donley  had explained                                                                   
it to  her, there  were funds  that could be  used to  do the                                                                   
project,  however,   there  is  a  grant  from   the  federal                                                                   
government for  $250 thousand dollars.   He had  intended for                                                                   
the Department  to get  the grant for  this project  and keep                                                                   
the original  allocation in  AMATS for contingency  projects.                                                                   
He understood that there were two different pots of money.                                                                      
                                                                                                                                
SENATOR HALFORD  asked if  there was a  net increase  of $250                                                                   
thousand dollars would be available  with the approval of the                                                                   
RPL.  He suggested that could create new federal money.                                                                         
                                                                                                                                
SENATOR   PEARCE    commented   that   the    Department   of                                                                   
Transportation  and Public Facilities  was going to  use $250                                                                   
thousand  dollars that  they already  had rather than  taking                                                                   
the federal money.                                                                                                              
                                                                                                                                
SENATOR HALFORD  pointed out that given the  contingency, the                                                                   
Department would  then have a  net increase of  $250 thousand                                                                   
dollars.                                                                                                                        
                                                                                                                                
DAVID TEAL referenced the letter,  noting that no LBA meeting                                                                   
had been  scheduled at that time  before the money  needed to                                                                   
be  obligated.   The Department  wanted to  proceed with  the                                                                   
project and felt the only way  to proceed was to use existing                                                                   
authority.   He recommended  that the  Department respond  to                                                                   
the questions of the Committee.                                                                                                 
                                                                                                                                
CHAIR  PHILLIPS reiterated  that  the request  came  directly                                                                   
from Senator Donley.                                                                                                            
                                                                                                                                
SENATOR  PEARCE  advised  that  was  because  the  Department                                                                   
wanted to use  the money they already had; they  did not want                                                                   
to put $250 thousand dollars more to the project.                                                                               
                                                                                                                                
DAVID TEAL  informed members  that he  could not address  the                                                                   
"internal" thinking of the Department.                                                                                          
                                                                                                                                
REPRESENTATIVE  MULDER clarified  that the  request would  be                                                                   
$250 thousand additional  dollars to AMATS.  He  asked if the                                                                   
RPL was  authorized,  would that funding  would be  replacing                                                                   
existing authorized funding.                                                                                                    
                                                                                                                                
SENATOR  ADAMS expounded  that  the Anchorage  community  has                                                                   
applied  for a  federal grant.   The  State is  only a  "pass                                                                   
through" vehicle  to give  the money to  that community.   He                                                                   
emphasized  that Anchorage  should  have  local control  over                                                                   
their needs.                                                                                                                    
                                                                                                                                
NANCY  SLAGLE stated  that  the request  was  a pass  through                                                                   
grant which AMATS applied for.   It must go through the State                                                                   
because  of  U.S. Department  of  Transportation  and  Public                                                                   
Facilities requirements.  There  is a deadline on the RPL and                                                                   
the Department has  been working with Anchorage  to make sure                                                                   
that the money is available to them.                                                                                            
                                                                                                                                
Originally, the Department did  plan to use the appropriation                                                                   
in   the  Capital   Budget,  an   AMATS  appropriation,   for                                                                   
contingency  and cost  overruns.   It would  fit within  that                                                                   
appropriation.     It  was  Senator  Donley's   concern  that                                                                   
prompted the Department  to bring the request  forward to the                                                                   
LBA Committee  to receive additional authority.   He believed                                                                   
that the Department would then  continue to have authority on                                                                   
the books for the contingency.                                                                                                  
                                                                                                                                
SENATOR  HALFORD  asked  if  the   Department  supported  the                                                                   
concept.                                                                                                                        
                                                                                                                                
NANCY  SLAGLE replied  that the  Department  could go  either                                                                   
way.    She suggested  that  it  would  be "cleaner"  if  the                                                                   
Committee provided the additional authority.                                                                                    
                                                                                                                                
CAROL TAYLOR indicated that everything  needed to be in place                                                                   
for the grant to be received by the 1st of October, 1999.                                                                       
                                                                                                                                
CHAIR PHILLIPS stated that the  RPL would be HELD for further                                                                   
discussion.                                                                                                                     
                                                                                                                                
EXECUTIVE SESSION                                                                                                             
                                                                                                                                
SENATOR PHILLIPS  made a motion, in accordance  with Title 24                                                                   
and  44, to  move to  Executive  Session for  the purpose  of                                                                   
discussing  audit reports,  which  are  held confidential  by                                                                   
law.   There  being  NO OBJECTION,  the  Committee went  into                                                                   
Executive Session at 9:20 A.M.                                                                                                  
                                                                                                                                
CHAIR  PHILLIPS  requested  that  Pat  Davidson  (Legislative                                                                   
Auditor), Merle  Jensen, (Deputy Legislative  Auditor), David                                                                   
Teal  (Director  of Legislative  Finance  Division)  and  Tom                                                                   
Maher (Legislative  Budget and  Audit Committee  Aide) attend                                                                   
the Executive Session.                                                                                                          
                                                                                                                                
The Committee resumed open session at 9:35 A.M.                                                                                 
                                                                                                                                
(TAPE MALFUNCTION)                                                                                                            
                                                                                                                                
AUDIT REPORTS                                                                                                                 
                                                                                                                                
SENATOR ADAMS  MOVED that the  final audits on the  agenda be                                                                   
released to the public:                                                                                                         
                                                                                                                                
     *    State of Alaska/Single Audit for FY 1998                                                                            
     *    DOA/DCED/ASMI/AIDEA                                                                                                 
     *    DOA/Office of Public Advocacy/Public Guardian                                                                       
          Program                                                                                                               
     *    DOC/Review of Select Internal Controls                                                                              
                                                                                                                                
There being NO OBJECTION, the  final audits were released for                                                                   
public view.                                                                                                                    
                                                                                                                                
SENATOR ADAMS MOVED to release  the preliminary audit report:                                                                   
                                                                                                                                
     *    DOA/Alaska Commission on Aging                                                                                      
                                                                                                                                
There being NO OBJECTION, the  preliminary audit was released                                                                   
for agency response.                                                                                                            
                                                                                                                                
OTHER COMMITTEE BUSINESS                                                                                                      
                                                                                                                                
CHAIR  PHILLIPS  acknowledged that  this  might  be the  last                                                                   
Budget  and  Audit Committee  meeting  before  Merle  Jensen,                                                                   
Deputy  Legislative Auditor,  retires.   Therefore, she  took                                                                   
the opportunity  to present  a plaque to  Mr. Jensen.   Chair                                                                   
Phillips  noted that  Mr.  Jensen had  used  his position  to                                                                   
actively promote  better government  and that  he had  been a                                                                   
strong  advocate  of the  principle  that State  agencies  be                                                                   
accountable to  the public.  She  stated that Mr.  Jensen had                                                                   
well served  the citizens of  the State, the  Legislature and                                                                   
the LBA Committee.   He had been  deputy to five of  the past                                                                   
six auditors and that his services will be missed.                                                                              
                                                                                                                                
CHAIR  PHILLIPS recommended  that the  Committee address  the                                                                   
Department   of  Law  briefing   on  Superior  Court   order,                                                                   
Kasayulie  versus   the  State  of  Alaska,   9/1/99  at  the                                                                   
scheduled Legislative Council meeting for October 1, 1999.                                                                      
                                                                                                                                
SENATOR PHILLIPS pointed out that  there was a representative                                                                   
from the Department of Law attending the LBA meeting.                                                                           
                                                                                                                                
BARBARA  RITCHIE advised  that the Department  is working  on                                                                   
the case.  At this point in time,  no final decision has been                                                                   
made, however,  the clock continues  to tick.   She explained                                                                   
that there  were two  portions of the  case, both  a facility                                                                   
and  trust section  and  to date,  there  has  been no  final                                                                   
judgement.                                                                                                                      
                                                                                                                                
SENATOR PARNELL  asked why reconsideration  had not  yet been                                                                   
filed.                                                                                                                          
                                                                                                                                
TOM DAHL  replied that there had  not been a motion  made for                                                                   
reconsideration.   He  acknowledged  that there  is a  better                                                                   
approach.                                                                                                                       
                                                                                                                                
SENATOR ADAMS  spoke to  the emotional  impact of the  issue.                                                                   
He recommended that  the State begin by trying  to solve some                                                                   
of the inequities that already exist.                                                                                           
                                                                                                                                
REPRESENTATIVE  BUNDE advised  that anytime  the Courts  find                                                                   
that  something  is unconstitutional,   there is  usually  an                                                                   
appeal.                                                                                                                         
                                                                                                                                
BARBARA  RITCHIE  stated that  the  findings  were not  taken                                                                   
seriously.   She reiterated  that  there has  not yet been  a                                                                   
final decision.                                                                                                                 
                                                                                                                                
REPRESENTATIVE MULDER  supported the idea of  addressing this                                                                   
issue  through a  joint  meeting scheduled  with  Legislative                                                                   
Counsel.  He acknowledged that  the argument of the plaintiff                                                                   
could establish the time frame.                                                                                                 
                                                                                                                                
BARBARA RITCHIE  stated that the  Court did have  information                                                                   
regarding the case  for the past ten years.   She recommended                                                                   
that it  would be better to  focus on the issues  rather than                                                                   
the length of time involved.                                                                                                    
                                                                                                                                
Senator Pearce asked to revisit RPL #25-0-6200.                                                                                 
                                                                                                                                
RPL Number:    25-0-6200                                                                                                      
                                                                                                                                
Department of Transportation                                                                                                    
     and Public Facilities                                                                                                      
AMATS Community Transportation                                                                                                  
     Cooperative Program (CTCP)                                                                                                 
                                                                                                                                
$250,000 Federal Receipts - Capital                                                                                           
                                                                                                                                
SENATOR DAVE  DONLEY stated  that the  funding source  is the                                                                   
Anchorage   Area   contingency    for   Planning/Construction                                                                   
shortfalls and Road/Intersection  Improvement.  He noted that                                                                   
he supported  additional  federal authorization  to fund  the                                                                   
grant, however, acknowledged the  possibility of finding STIP                                                                   
or TIP monies.                                                                                                                  
                                                                                                                                
(TAPE RECOVERY)                                                                                                               
                                                                                                                                
REPRESENTATIVE MULDER  asked if the money would  "go away" if                                                                   
the RPL were not awarded.                                                                                                       
                                                                                                                                
SENATOR DONLEY understood from  reading the Department's back                                                                   
up that there is  a time limit in which the  money would need                                                                   
to be locked in.  He believed that date was September 30th.                                                                     
                                                                                                                                
NANCY  SLAGLE  stated that  the  grant  monies would  not  be                                                                   
available  if not obligated  by the  end of  the month.   She                                                                   
pointed out that if the Department  does not receive approval                                                                   
for additional receipt and expenditure  authority or approval                                                                   
to use the contingency appropriation  for this purpose, there                                                                   
is a possibility of loosing that money.                                                                                         
                                                                                                                                
CHAIR PHILLIPS  questioned what the recourse  would have been                                                                   
if a  LBA Committee  meeting had not  been scheduled  at this                                                                   
time.                                                                                                                           
                                                                                                                                
NANCY SLAGLE replied that the  Department would have used the                                                                   
contingency funding.                                                                                                            
                                                                                                                                
REPRESENTATIVE  MULDER  asked if  the $250  thousand  dollars                                                                   
would then "go away".                                                                                                           
                                                                                                                                
NANCY  SLAGLE  understood that  the  grant  money had  to  be                                                                   
obligated.                                                                                                                      
                                                                                                                                
CHAIR PHILLIPS  believed that  the approval had  already been                                                                   
granted  to  the  Department  in last  year's  budget.    She                                                                   
reiterated  her concern  with  bringing this  RPL before  the                                                                   
Committee for action.                                                                                                           
                                                                                                                                
SENATOR   PEARCE  asked   how   the  Department   could   use                                                                   
contingency money  that was approved  as part of AMATS  for a                                                                   
project that was not listed on the STIP or the TIP.                                                                             
                                                                                                                                
NANCY  SLAGLE  replied  that  if  the  Department  could  not                                                                   
receive specific  authority, they would have to  rely on this                                                                   
money.  It  is a fairly broad appropriation,  the contingency                                                                   
appropriation, in  that it was not an appropriation  that was                                                                   
requested  by  the  Department  but rather  included  by  the                                                                   
Legislature.  The Department had  not received specific back-                                                                   
up   to  indicate   the   breadth  of   the   size  and   the                                                                   
appropriation.    She reiterated  that  it  is a  very  broad                                                                   
appropriation.     The   Department   felt   that  with   the                                                                   
information that they had, it could be accommodated.                                                                            
                                                                                                                                
SENATOR  PEARCE  asked  if  the  Department  had  been  given                                                                   
specific  direction  before the  Governor  vetoed the  Intent                                                                   
Language.                                                                                                                       
                                                                                                                                
NANCY SLAGLE stated  that she did not believe  that there was                                                                   
Intent  Language  that  was  written   specifically  to  that                                                                   
appropriation.                                                                                                                  
                                                                                                                                
REPRESENTATIVE  THERRIAULT noted  that this  project had  not                                                                   
been approved.  He warned that  the Department was attempting                                                                   
to "slide" the  project in under a broad interpretation.   He                                                                   
reiterated that it  was not approved and that  this money was                                                                   
new.                                                                                                                            
                                                                                                                                
Representative  Therriault believed  that it was  appropriate                                                                   
that  the  LBA  Committee  make the  decision  at  this  time                                                                   
whether to approve these funds.                                                                                                 
                                                                                                                                
A roll call vote was taken on  the motion to approve RPL #25-                                                                   
0-6200.                                                                                                                         
                                                                                                                                
IN FAVOR:      Representatives Croft, G. Davis                                                                                  
               Mulder (alternate)                                                                                               
               Senators Parnell, Wilken, Adams, Halford                                                                         
OPPOSED:       Representatives Phillips, Therriault, Bunde                                                                      
               Senators Phillips                                                                                                
                                                                                                                                
The MOTION PASSED (6-4).                                                                                                        
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting adjourned at 10:05 A.M.                                                                                             

Document Name Date/Time Subjects