Legislature(2001 - 2002)
03/14/2001 06:04 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
March 14, 2001
6:04 PM
TAPES
SFC-01 # 41, Side A
SFC 01 # 41, Side B
SFC 01 # 42, Side A
CALL TO ORDER
Co-Chair Pete Kelly convened the meeting at approximately 6:04 PM.
PRESENT
Senator Dave Donley, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Jerry Ward, Vice Chair
Senator Lyda Green
Senator Gary Wilken
Senator Alan Austerman
Senator Lyman Hoffman
Also Attending: KEN BISCHOFF, Director, Division of Administrative
Services, Department of Public Safety; DAN FAUSKE, Chief Executive
Officer/Executive Director, Alaska Housing Finance Corporation
(AHFC); LES CAMBELL, Budget Director, AHFC; ROBERT BREAN, Director,
Research and Rural Development, AHFC; WES WEIR, Director, Public
Housing Division, AHFC; BARBARA BAKER, Director, Planning and
Program, AHFC; DAN EASTON, Director, Division of Facility
Construction and Operation, Department of Environmental
Conservation; LARRY DIETRICK, Director, Division of Spill
Prevention and Response, Department of Environmental Conservation;
TOM CHAPPLE, Director, Division of Air and Water Quality,
Department of Environmental Conservation;
Testifying via Teleconference: From Anchorage: JANICE ADAIR,
Director, Division of Environmental Health, Department of
Environmental Conservation
SUMMARY INFORMATION
SB 29-REAPPROPRIATIONS & CAPITAL APPROPRIATIONS
The Committee heard from the Department of Public Safety, the
Alaska Housing Finance Corporation, and the Department of
Environmental Conservation on specific budget requests.
SENATE BILL NO. 29
"An Act making capital appropriations and capitalizing funds;
making appropriations under art. IX, sec. 17(c), Constitution
of the State of Alaska, from the constitutional budget reserve
fund; and providing for an effective date."
Department of Public Safety
Aircraft and Vessel Repair and Maintenance
$1,200,000
Reference No.: 6121
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
These funds are for the annual repair and maintenance
requirements of this division's aircraft and vessel fleet. For
example, the funds will be used to rebuild vessel and aircraft
engines and components when they reach the limits of safe
useful life. Large marine diesel engines and aircraft engines
require expert vendors to rebuild them. Many other components
of vessels and aircraft must be maintained or replaced
routinely to ensure safe operating conditions.
KEN BISCHOFF, Director, Division of Administrative Services,
Department of Public Safety presented this item.
Senator Austerman asked if this item has been funded at this level
in previous years.
Mr. Bischoff referenced the capital budget detail information
showing the amount has fluctuated between $900,000 and $1.2 million
over the past several years.
Trooper Law Enforcement Equipment
$350,000
Reference No.: 32261
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Purchase of new and replacement equipment for the use of State
Trooper personnel throughout the state. The Division of Alaska
State Troopers historically has relied upon CIP funding for
these types of replacement items due to a lack of replacement
funding in the AST operating budget.
Mr. Bischoff gave microcomputer, dispatch recorder, methamphetamine
laboratory investigative equipment and radio antenna as some of the
items this funding would address.
Fish and Wildlife Statewide Law Enforcement Equipment
Replacement
$250,000
Reference No.: 6127
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2007
Replacement of FWP Statewide Law Enforcement Equipment
required for the day-to-day enforcement activity of this
division. For example, to purchase and replace equipment such
as skiffs, outboard motors, snowmachines, All-Terrain-
Vehicles, and other equipment required in enforcement patrols
and search and rescue operations.
Mr. Bischoff noted this is a similar request as the previous except
that it is for the "brown shirts" i.e. Fish and Wildlife Protection
Officers.
Fairbanks Public Safety Building Roof Replacement
$770,100
Reference No.: 32469
AP/AL: Appropriation
Category: Public Protection
Location: Fairbanks (West Fairbanks)
Election District: West Fairbanks
Estimated Project Dates: 07/01/2001 - 06/30/2002
Replace the deteriorating roof on the Public Safety Building
in Fairbanks.
Mr. Bischoff understood this is the original roof to this building
and is over 20 years old.
Soldotna Public Safety Building Roof Repair
$115,100
Reference No.: 32459
AP/AL: Appropriation
Category: Public Protection
Location: Soldotna (Seward, Soldotna)
Election District: Seward, Soldotna
Estimated Project Dates: 07/01/2001 - 06/30/2002
This project provides funds to repair the roof of the Public
Safety Facility in Soldotna.
Mr. Bischoff said this is similar to the request before it.
Senator Wilken commented, "These are great projects."
Crime Lab Improvement Program
$1,459,600
Reference No.: 33968
AP/AL: Appropriation
Category: Public Protection
Location: Anchorage Areawide
Election District: Anchorage Areawide
Estimated Project Dates: 07/01/2001 - 06/30/2003
The US Department of Justice will be awarding a $1,250,000
federal grant for the Crime Lab Improvement Program (CLIP).
The CLIP grant along with a portion of the GF match will fund
the purchase of lab equipment, training, DNA supplies and
contract with private laboratories for DNA analysis. In
addition to the purchase of equipment, supplies and services
the Crime Lab will remodel the autopsy area once the Medical
Examiner relocates to the new public health facility in
January 2001.
Mr. Bischoff stated the general fund match request is $209,000 and
would be supplemented with funds from a reappropriation request.
Fish and Wildlife Enforcement Vessels Replacement
$400,000
Reference No.: 6126
AP/AL: Appropriation
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2004
Replace 6 Law Enforcement Patrol Vessels Statewide.
Mr. Bischoff informed this funding would be used to replace the P/V
Burton stationed in Cordova, which is over 20 years old, has
"outlived its useful life" and has been surplused. The new vessel
would be 36 feet.
Senator Austerman asked if the $400,000 would be supplemented with
funds garnered from the sale of the P/V Burton.
Mr. Bischoff understood $400,000 is a sufficient amount to purchase
the new vessel. He noted it would be a rigid-hull inflatable.
Grants to Domestic Violence Shelters
$200,000
Reference No.: 34008
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
The Council is requesting a capital improvement grant for
shelters in the amount of $200,000. The requested amount will
provide about 40% of the amount required to meet the highest
priority health and safety needs as determined through a
comprehensive needs' assessment by the programs.
Mr. Bischoff stated this item would address security issues and
handicap access.
Senator Wilken asked if there is a funding history for this
request.
Mr. Bischoff replied this would be the first direct maintenance
appropriation from the Department to the Council on Domestic
Violence and Sexual Assault (CDVSA).
Alaska Law Enforcement Photo Network
$1,300,000
Reference No.: AMD34775
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Alaska statewide law enforcement requires critical
identifiers, e.g. fingerprints, photographs, and DNA, to
conduct its daily work. This project would provide direct
access to Alaska booking, driver and ID photographic
information by law enforcement agencies throughout the state.
Mr. Bischoff noted this federal grant would be used to replace
digital cameras in every adult correctional facility and community
jail in the state. He said this would allow the "booking photos" to
be placed on-line and would give access to law enforcement
officials. He added that it is hoped there would be enough funds to
also pay for a pilot project with the Division of Motor Vehicles in
the Department of Administration that would give on-line access to
that Division's photos as well.
Rural Law Enforcement Support
$1,800,000
Reference No.: AMD34776
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
The Department of Justice, Office of Community Oriented
Policing Services will be awarding the Alaska Department of
Public Safety $1,800,000 to train Village Police Officers,
Village Public Safety Officers and Tribal Police Officers to
increase their ability to deal with crisis situations and to
purchase equipment for better responses to emergencies.
Mr. Bischoff testified this is a federal grant and he referenced a
list of equipment that would be purchased with the funds, which
included in the budget summary.
Technology, Policing and Enforcement Initiatives Grants to
Municipalities
$2,200,000
Reference No.: AMD34841
AP/AL: Appropriation
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
These federal grants are pass-through grants through the
Alaska Department of Public Safety to local municipalities for
various public safety projects.
Mr. Bischoff stated this is a consolidated federal grant that, at
the request of US Senator Ted Stevens, would be distributed by the
Department to Fairbanks, Juneau, Kotzebue, Bethel and Wasilla.
King Salmon Facility Maintenance
$96,800
Reference No.: AMD34962
[Note: project summary data not provided.]
Mr. Bischoff stated the Department of Public Safety shares this
facility with the Department of Fish and Game. He stated that
$96,800 general funds is the Department of Public Safety's portion
of the amount needed to upgrade and repair this facility.
Mr. Bischoff then directed the Committee's attention to Section 10
of the bill, in the Language section. He stated this provision
would allow the Department to sell three aircraft and use the
proceeds to purchase new replacement aircraft. He recounted that
similar provisions have been approved by the Legislature in the
past several years.
AT EASE 6:14PM/6:15PM
Department of Revenue-Alaska Housing Finance Corporation
DAN FAUSKE, Chief Executive Officer/Executive Director, Alaska
Housing Finance Corporation (AHFS) testified that members of the
AHFC staff and himself would present the capital budget for AHFC's
housing grants programs and for major renovation and maintenance of
public housing facilities. He noted all the requests are "part of
the transfer plan between AHFC and the State of Alaska" and the
$103 million anticipated as available for FY 02. He pointed out
that the $103 million available to "the transfer plan" is the
amount established "as a recognition that AHFC has to be recognized
as a growing concern." He continued that "the transfer plan" is, "a
term of ours to describe the maintenance and upkeep of an asset
that provides a return you, its owner." He stressed the funding
requests before the Committee address some of the on-going needs of
the Corporation in keeping up its assets and meeting its mission
and mandate to assist in the development of housing.
Mr. Fauske asserted that AHFC dividend funds are often "discussed
as general funds" but are generated from the net income and
financial strength of the Corporation. For these funds to continue
to be available, he asked that the Legislature and the Corporation
"work together".
Mr. Fauske cited SB 360, passed in 1998, "…The legislature intends
to ensure the prudent management of the Alaska Housing Finance
Corporation to protect the excellent debt rating by the nation's
financial community and to preserve it as a valuable asset of the
state. To accomplish this goal, the sum of withdrawals for
repayment of bonds under Sec. 2 (c) of this Act for transfer to the
general fund and for expenditures for corporate funding capital
projects should not exceed the corporation's net income for the
proceeding fiscal year." He noted that to date, both the Board of
Directors and the Legislature have adhered to this agreement.
However, he opined, the pressure for funding from AHFC has
increased each year.
Mr. Fauske totaled the amount requested for AHFC projects for FY 02
at $22.9 million AHFC funds; compared to $18.7 million appropriated
the previous year. He noted some major renovation projects in FY 01
were structured to receive funding in phases over more than one
fiscal year and the second phases are included in the FY 02
proposed budget.
Mr. Fauske shared that the Office of Management and Budget
forwarded a list of requests to AHFC as follows.
1. Identify those capital projects that are new and those that
are funded historically in the capital budget. Identify
those capital projects that have been requested in past
fiscal years but not funded.
Mr. Fauske stated there are no new capital projects requested in
the FY 02 proposed budget. He added that all of the projects had
been requested in FY 01 and did receive funding.
2. Explain how priority lists are established and projects are
ranked.
Mr. Fauske explained the Corporation's budget requests and
priorities are established through a process that starts with staff
and is presented to the Budget and Housing Policy Committee, a
subcommittee of the Board of Directors, then brought before the
Board and finally submitted to the Office of Management and Budget.
3. List state match requirements for each project and identify
any capital request that if funded, would result in additional
operating budget funding in future fiscal years.
Mr. Fauske stated these issues would be addressed as each request
is presented.
Supplemental Housing Development Program
$6,000,000
Reference No.: 6323
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Supplemental Housing Development Program utilizes Corporate
(AHFC) funds to supplement Federal (HUD) funds to construct
decent, safe and sanitary housing through regional housing
authorities established under AS 18.55.996. Funds are used to
cover housing development costs related to water distribution,
sewer hookups, electrical distribution systems, road
construction to project site, site development, and energy
efficiency improvements. State laws limit the use of these
funds to 20% of the HUD's total development cost per unit, and
are prohibited from being used for administrative or other
costs of the housing authority.
LES CAMPBELL, Budget Director, AHFC, testified the purpose of this
project is to construct 320 affordable homes in 20 urban and rural
communities for 320 families. He added that these funds would
"leverage" $4 million in federal Indian Health/Public Health funds
for water and sewer facilities.
Mr. Campbell listed the funding history for this item as $3,900,000
in FY 01, $4 million in FY 98, $6 million in FY 98, $7 million in
FY 97, and $10 million in FY 96.
Senator Wilken requested a list of the communities that would
receive these funds.
Mr. Campbell indicated that the Corporation has a list of the
eligible housing and locations. He noted the exact projects are
not yet determined and the amount funded to each project depends
upon the total amount allocated by the Legislature..
Co-Chair Kelly asked if the housing units are multi-family.
Mr. Campbell replied the units vary from single-family homes with
three to four bedrooms to duplexes and four-plexes. He added that
the projects are not all for new construction and that some of the
funds would be used for renovations on existing units.
Mr. Campbell clarified for Senator Leman that each unit is counted
as housing for one family, i.e. a four-plex is considered four
units. He also noted the 320 unit target could change depending
upon the actual construction costs.
Low-Income Weatherization
$5,400,000
Reference No.: 6332
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal US Department of Energy (DOE) and Corporation (AHFC)
funds to assist low- and moderate-income families attain
decent, safe and affordable housing through Weatherization and
rehabilitation of existing homes. Many homes in rural Alaska
cannot maintain a healthy indoor temperature of 70 degrees
during our long winter months. This request includes
$2,000,000 to assist in the recent fish disasters.
Mr. Campbell listed this item consists of $1,400,000 federal
receipts and $4,000,000 AHFC receipts. He said the intent is to
replace over 500 unsafe heating systems, install smoke detectors in
over 700 homes and carbon dioxide detectors in 350 homes. He
calculated this project would serve approximately 4,000 Alaskans in
about 1,100 homes.
Senator Ward cited figures from an Oak Ridge National Study that
estimate an energy savings of Weatherization projects at 23
percent. He asked if a 23 percent reduction in fuel consumption
has actually been realized.
Mr. Campbell pointed out the 23 percent estimate was based on a
nationwide study. He stated that the Corporation has never measured
the energy consumption after completion of weatherization projects,
but stressed fuel consumption does reduce after air leaks are
sealed.
ROBERT BREAN, Director, Research and Rural Development, AHFC,
clarified the Corporation has measured energy consumption in some
homes and has identified savings. He noted fuel savings are higher
than 23 percent in Alaska, given the harsher weather conditions. He
offered to share details of the findings with Senator Ward.
Senator Ward expressed he has been encouraged by this program and
would like to learn more about the successes.
Paxton Manor Replacement
$2,401,000
Reference No.: 34017
AP/AL: Appropriation
Category: Housing/Social Services
Location: Sitka
Election District: Sitka, Wrangell, Petersburg
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporate (AHFC) funds to complete the replacement of 24
units, which were built in 1965, and construction of a new
multi-purpose building which will provide space for an office,
maintenance shop, and a community room at Paxton Manor in
Sitka. These funds will improve the living environment for
residents, provide energy efficient units, cure site drainage
problems and add ADA compliant units. Federal funds from the
HUD Capital Fund Program will also be used to complete this
project.
Mr. Campbell qualified that although this program is listed as new,
it is actually a continuation of upgrades to the public housing
facility in Sitka. He said one of the purposes of the project is
to reduce maintenance costs.
Senator Wilken pointed out that federal receipts have been used to
fund this project in the past and asked if the funds were secured
for FY 02. He also asked if the federal funds require a match.
Mr. Campbell answered that a match is not required, but that the
AHFC funds requested are necessary to complete the project. He
stated the federal funds would be available and noted this request
is linked to another, which would be discussed later.
Senator Wilken asked the total state expenditure on the project.
Mr. Campbell listed $6,518,858, which calculates to approximately
$247,000 per unit plus the cost of community buildings and shared
space.
Senator Austerman asked if this funding would complete the 24
units.
Mr. Campbell affirmed this funding would complete the entire
renovation project for the Sitka housing facility.
Senator Wilken asked if it would be more cost effective to demolish
the existing units and construct new units.
Mr. Campbell clarified this is the project.
Chugach View Renovation-Phase 2 (Anchorage Senior Units)
$4,697,000
Reference No.: 32515
AP/AL: Appropriation
Category: Housing/Social Services
Location: Anchorage Areawide
Election District: Anchorage Areawide
Estimated Project Dates: 07/01/2001 - 06/30/2006
This utilizes Corporate (AHFC) and Federal funds for Phase II
of the major renovation of Chugach View. (Phase I was funded
for FY2000.) Chugach View is a 120 unit low-income senior
housing complex across from the senior center in Anchorage.
Phase II will fund interior renovations to all kitchens and
bathrooms, and install new appliances and fixtures. In
addition, ventilation and heat recovery systems will be
installed, lighting will be improved, and accessibility
features added.
Mr. Campbell noted the funding consists of $2,697,000 AHFC receipts
and $2,000,000 federal receipts. He stated this project is
necessary to meet building safety code requirements and would also
reduce long term operating costs.
AHFC Senior Citizens Housing Development Program
$1,472,200
Reference No.: 6334
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporate (AHFC) funds to grant to municipalities and public
or private non-profit corporations, in conjunction with other
agencies, for the development of senior citizen housing. Funds
can be used for: purchase of building sites, site preparation,
materials, construction, and rehabilitation. Awards are made
on a competitive basis contingent on Legislative approval.
Mr. Campbell referenced the capital budget summary information,
which includes a list of applicants.
Senior and Statewide Deferred Maintenance and Renovation
$2,500,000
Reference No.: 6339
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporation (AHFC) and Federal funds to reduce deferred
maintenance at several facilities utilized by senior citizens
and low-income families. General physical upgrades are needed
in addition to specific security and accessibility
modifications.
Mr. Campbell stated the funding amount consists of $500,000 federal
receipts and $2,000,000 AHFC receipts.
Mr. Campbell referenced the capital budget summary information,
which includes list of deferred maintenance projects.
Senator Wilken asked about the administrative cost of $515,834.
Mr. Campbell explained this covers overhead costs related to the
projects including inspectors and construction coordinators.
Senator Wilken remarked that 20 percent of the total budget seemed
excessive.
WES WEIR, Director, Public Housing Division, AHFC, testified that
20 percent is normal for AHFC projects and is "considerably below
the overhead calculated for capital projects for any other state
agency" that he was aware of.
AHFC Housing and Urban Development Capital Fund Program
$3,500,000
Reference No.: 6342
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal (HUD) grant that provides Public Housing Authorities
with funds each year to help renovate and modernize public
housing units. Funds also provide for administrative expenses,
tenant-education projects, drug elimination/safety projects
and management improvements.
Mr. Campbell stated the intent of this item is to combine these
funds with other funds allocated to Paxton Manor for the purpose of
completing the 24 units in the Sitka housing facility, install
screen doors and storage sheds at Birch Park in Fairbanks and
provide interior modernization and site work at Spruce Park in
Fairbanks and New Willow in Anchorage.
Senator Austerman asked about the funds allocated to Paxton Manor.
Mr. Campbell responded that $2,565,568 of this appropriation would
originate from the Paxton Manor account. The remaining funds are
from a "similar program that was funded last year" he said.
AHFC Housing and Urban Development Federal HOME Grant
$3,800,000
Reference No.: 6347
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal (HUD) and Corporate matching (AHFC) funds for the HOME
Investment Partnership Program. The purpose of the HOME
program is to expand the supply of affordable, low- and
moderate-income housing and to strengthen the ability of the
state to design and implement strategies to achieve an
adequate supply of safe, energy-efficient, and affordable
housing. The Municipality of Anchorage has their own separate
HOME program.
Mr. Campbell detailed this appropriation consists of $3,050,000
federal receipts, with $750,000 AHFC receipts fulfilling the match
requirement.
Senator Wilken asked if the Corporation had determined where the
funds would be spent.
Mr. Campbell did not know that any determinations had been made to
date.
BARBARA BAKER, Director, Planning and Program, AHFC, testified the
funds would be spent throughout the state among three separate
programs. She listed them as the Gold Program, Residential Housing
Development Program consisting of two projects in Soldotna and
Homer, Owner Rehabilitation Program for homes in all areas of
Alaska (she estimated approximately 70 homes would be rehabilitated
under this program) and a closing costs program for new homeowners
that would serve an estimated 50 families in Juneau, Fairbanks and
Southcentral.
AHFC Federal and Other Competitive Grants
$4,250,000
Reference No.: 6348
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal (HUD) and Corporate match (AHFC) grant funds. AHFC
will apply for grants that target the housing needs of low-
income and special needs groups; such as senior citizens, the
mentally ill, disabled or the homeless. AHFC will also apply
for energy related grants as they related to housing. When
required, AHFC will provide the needed matching funds. Some of
the funds received will be passed through to local non-profit
sub-grantee organizations who deliver housing and/or services.
Mr. Campbell noted this appropriation consists of $3 million
federal receipts and $1,250,000 AHFC receipts. He gave examples of
past projects, including housing for people with AIDS.
AHFC Competitive Grants and Public Housing
$1,000,000
Reference No.: 6350
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal (HUD) and Corporate matching (AHFC) grant funds. AHFC
will apply for HUD grants that target the housing needs of
low-income and special needs groups; such as senior citizens,
the mentally ill, disabled, or the homeless. AHFC will also
apply for grants to prevent crime and substance abuse in
public housing and assist public housing families attain
economic self-sufficiency. When required, AHFC will provide
the needed match.
Mr. Campbell listed the funding consists of $750,000 federal
receipts $250,000 AHFC receipts. He informed this item is similar
to the previous item with the exception that it specifically
targets residents of assisted or public housing.
AHFC Energy Efficiency Monitoring Research
$300,000
Reference No.: 6351
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporate (AHFC) funds to conduct research, analysis, and
information dissemination and interchange among members of the
industry, and between the industry and the public. Through
competitive procedures, an entity would be selected to provide
data gathering and analysis of energy efficient designs for
homes, as well as, monitoring activity of homes.
Mr. Campbell stated this funding is AHFC receipts.
Senator Austerman relayed he recently read an article about global
warming that claimed the temperature in the Fairbanks area has
warmed almost ten degrees Fahrenheit and as a result, permafrost is
melting. He asked if this project would assist in the preparation
or remediation of damage caused by such melting.
Mr. Campbell was unsure whether global warming was included in the
perimeters of the research project.
Mr. Fauske interjected to say global warming is one of the issues
that would probably arise as the research project is planned.
Senator Austerman surmised that if a change to housing is taking
place because of permafrost melting, the implications should be
considered.
AHFC State Energy Program Special Projects
$180,000
Reference No.: 32526
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Federal (DOE)and Corporate match funds for State Energy
Program (SEP) special projects such as: building technologies,
Codes and Standards, Wind, Power technologies, renewable
energy for remote areas, or transportation technologies.
Mr. Campbell listed the funding consists of $150,000 federal
receipts and $30,000 AHFC receipts.
Senator Wilken requested a report of how the $180,000 appropriation
in FY 01 was used.
Senator Austerman asked about the correlation between the Alaska
Energy Authority (AEA) and the AHFC on energy issues.
AHFC Homeless Assistance Program
$450,000
Reference No.: 6359
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporate (AHFC) and Trust (MHTF) funds to grant to local
communities/agencies to help develop programs to prevent
homelessness by providing assistance to families in imminent
danger of becoming homeless, or those who are currently
homeless. Corporate funds will be matched by $200,000 Mental
Health Trust Authority. Both funds will be combined and
administered as one program by AHFC.
Mr. Campbell detailed the funding consists of $250,000 AHFC
receipts and $200,000 Mental Health Trust Fund (MHTA) Receipts
Mr. Campbell referenced a list of applicants contained in the
capital project summary.
AHFC Beneficiary and Special Needs Housing
$1,500,000
Reference No.: 6360
AP/AL: Appropriation
Category: Housing/Social Services
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Corporate (AHFC) funds for Alaskan non-profit service
providers and housing developers to increase housing
opportunities to Alaska Mental Trust beneficiaries and other
special needs populations throughout Alaska. These funds will
continue a demonstration project to divert individuals from
institutions into community-based assisted living.
Mr. Campbell noted these funds are entirely AHFC receipts. He
detailed the people served by this program include those with
developmental disabilities, who suffer from a mental illness and
recovering alcoholics and addicts.
Mr. Campbell noted this concluded the presentations on the
individual AHFC requests. He referenced the six-year capital
projects plan that began in FY 97.
Senator Austerman asked the total AHFC receipts requested for
capital projects in the FY 02 budget.
Mr. Campbell answered $22.9 million.
Mr. Fauske informed the Committee that he had been appointed to a
Congressional commission on Lending Housing, a bi-partisan 22-
member panel charged with making recommendations on housing
availability. He commented that the "gap between the haves and the
have-nots is an ever widening concern." He noted that the price of
homes is rising, citing the median cost of a home in San Francisco
is $469,000 and that some people with annual incomes of $50,000 are
forced to live in cars. Fortunately, he said, Alaska is not faced
with this situation.
Mr. Fauske shared that in recent meetings of this commission, the
issue of recent tax reforms and the "1988 Tamarack Rule" was
discussed. He pointed out these changes could affect the state "to
the tune of millions of dollars." He explained the Tamarack Rule
imposes an "arbitrary" restriction on the number of times a bond
could be refinanced in the first ten years of its original
issuance. He informed that the practice of most housing finance
corporations is to "recycle" funds generated from bond payments to
purchase more bonds, which "gives an absolute advantage depending
on what market conditions are to generate low-cost capital for
residents." Under the Tamarack Rule, he said, the funds could no
longer be used to purchase new bonds after the ten-year
anniversary, but instead must be used to pay off existing debt. He
stated that repealing this Rule is a top priority of the National
Association of Safe Housing Agencies.
SFC 01 # 41, Side B 06:53 PM
Mr. Fauske continued another issue before the commission is
acquisition limits; AHFC has these limits under the tax-exempt
first homebuyer program, which make it more difficult to operate
the program in Alaska at a level that accurately reflects housing
costs and income levels.
Another issue, he shared, relates to veterans bonds and provides a
one-percent interest rate reduction for men and women who have
served in the military. Alaska is one of five states, California,
Oregon, Texas and Michigan being the others, that issue tax-exempt
veterans bonds, and he noted this program sunsets in a few years.
He declared Alaska has between 68,000 and 70,000 veterans, which is
a "significant" percentage of the entire state population.
He relayed the sentiments of the commission that there is support
to continue tax credit programs and other federal programs,
although there is debate over who should receive these benefits. He
reported he has been appointed to the tax policy subcommittee and
could become vice-chair of the finance subcommittee, which he said
offers an opportunity to share AHFC ideas.
Senator Austerman asked about possible duplication of efforts by
the AHFC, the AEA and the Denali Commission in energy-related
matters.
Mr. Fauske informed the Committee of a reimbursable services
agreement (RSA) with the Alaska Industrial and Developmental Export
Authority (AIDEA) to share federal funds.
Mr. Brean clarified that AHFC is designated by the US Department of
Energy to receive Alaska's energy program funds. He noted the
Corporation's focus is on residential housing, whereas the AIDEA
focus is on power production. He said the two state organizations
have combined efforts to "revamp" the Sheldon Jackson School in
Sitka. He added that AIDEA is also working with the Denali
Commission on addressing bulk fuel facilities.
Senator Ward asked what efforts the congressional commission plans
to take to ensure the continuation of the veterans bond program.
Mr. Fauske noted that preservation of this program had been opposed
in the past because the program is not revenue neutral. Mr. Fauske
admitted it is difficult to defend a program that only affects five
states. However, he noted there is support from other members of
congress who are veterans He detailed the program and expressed
his support as he is a veteran. He stated that if the federal
program were discontinued, AHFC would attempt to create a new
program to offer similar benefits.
Department of Environmental Conservation
DAN EASTON, Director, Division of Facility Construction and
Operation, Department of Environmental Conservation, indicated that
the Division's mission is to assist communities in improving
sanitation conditions through grants and low-interest loans to
build water, sewer and waste facilities. He noted the FY 02
proposed capital budget is different from previous years, such as
FY 99, which "invested" $44 million of state funds for sanitation
programs, compared to $29 million or one-third of that amount this
year. However, he noted an $11 million increase in federal funds,
which is a result of a change to the match ratio and also
legislation adopted in recent years that provides options to
capitalize on the loan fund.
Mr. Easton addressed noted the Division solicits grant applications
for the following four projects, which are then ranked based on
public health and environmental need. He detailed the criteria,
including the cost to maintain facilities. He pointed out there is
no match requirement of the communities; the funds are 75 percent
federal and 25 percent state.
Senator Austerman noted the total AHFC dividend funds proposed for
these projects is $28,250,000, compared to $22.9 million for AHFC
projects. He questioned the priorities of the AHFC funds.
Village Safe Water Project Administration
$1,961,100
Reference No.: 33820
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Village Safe Water project administration is the operating
cost of delivering Village Safe Water services to communities.
These funds pay for Village Safe Water engineers and other
program staff, as well as associated travel, contracts,
supplies and equipment.
Mr. Easton presented this item.
Co-Chair Kelly reiterated the Division ranks the grants received
and funds the projects accordingly and referenced the priority list
included in the capital project summary.
Village Safe Water Feasibility Studies
$3,825,000
Reference No.: 33821
AP/AL: Appropriation with Allocations
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Grants to communities for preparing engineering feasibility
studies. The studies identify designs and operating costs for
sanitation facilities that are appropriate for the community.
Mr. Easton referenced the allocations listed in the capital project
summary, noting that each represents an engineering study to
examine options and costs for sanitation systems.
Senator Wilken totaled the amounts appropriated to the Village Safe
Water projects at $38,477,000 federal funds and $12,826,000 AHFC
dividend funds. He requested information regarding the population
served, other funding sources, and local participation for each
project.
Co-Chair Kelly and Senator Wilken established there is no local
matching fund requirement for any of the projects.
Mr. Easton responded the requested information relating to funds
garnered from various federal agencies for safe water projects is
"expansive" but assured the Division would provide as much as
detail possible.
Senator Wilken commented that there should be a compilation for
each project showing the total cost, local investment, history of
funding, and the population served.
Municipal Water, Sewer and Solid Waste Matching Grant Projects
$23,510,600
Reference No.: 33824
AP/AL: Appropriation with Allocations
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Grants to larger communities for municipal water, sewer, and
solid waste planning, design and construction projects. Grants
require a local match of 15% - 50% of project costs.
Mr. Easton noted this is primarily a state-funded program
consisting of allocations for various projects.
Environmental Health Food Safety Laboratory Construction
$13,964,700
Reference No.: 33825
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Current food safety laboratory facilities lack basic
infrastructure requirements. The lease expires in December,
2000 with no potential for long term renewal. This project
contracts for services to complete facility programming,
detailed design, specifications, and the construction of a new
Food Safety Laboratory.
JANICE ADAIR, Director, Division of Environmental Health,
Department of Environmental Conservation testified via
teleconference from Anchorage to update the Committee on how a
previous appropriation to this project was used to begin the
process of constructing a new laboratory. She stated that a site
has been selected in Anchorage, which she said is preferable over
Palmer because samples could be transported from the Ted Stevens
International Airport sooner. She detailed the functions of the
laboratory including testing shellfish.
Senator Leman relayed that his main concern with new state
laboratories is that they do not directly compete with private
industry.
Ms. Adair assured there are no other laboratories in the state
certified to perform the testing conducted by the state-operated
facility.
Statewide Contaminated Sites Cleanup
$5,000,000
Reference No.: 33826
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Assessment and cleanup of highest priority state owned sites
or sites where the responsible party is unknown or has refused
to take appropriate action. Work includes site assessment,
correction action plan, cleanup monitoring and final site
closure.
$5,00,000 Oil/Hazard Funds
LARRY DIETRICK, Director, Division of Spill Prevention and
Response, Department of Environmental Conservation, listed the
funding source as the Oil Hazardous Substance Release Prevention
and Response fund. He described the 16 state-owned sites and 13
"orphan sites" that are a high priority, which this appropriation
would address.
Mr. Dietrich shared that the Department is making progress in
reducing the number of contaminated state-owned sites. He noted the
federally owned sites make up the majority of contaminated sites in
Alaska.
Senator Hoffman asked if any of the sites are located in his
district.
Mr. Dietrick referenced a list of the proposed projects. [Copy not
provided.]
Small Drinking Water System Operator Certification Project
$1,276,800
Reference No.: 33988
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Recent changes in federal law require operators of small
drinking water systems to be "certified". This project takes
advantage of federal grant dollars to offset costs associated
with training and certification of those operators.
Mr. Easton stated this is a one-time federal grant from the US
Environmental Protection Agency (EPA) to address the new federal
law, which lowers the size of drinking water systems that must have
a certified operator. He said formerly, operators of systems that
served more than 500 people must be certified; the new requirement
expands the certification to include systems serving 25 people or
more. He said most of the funds would be used for onsite training
to certify operators for approximately 600 drinking water systems.
He noted no state match is required.
Senator Leman relayed concerns raised in the budget subcommittee
regarding the turnover of operators and limited attention given to
smaller systems. He surmised this program is therefore not a wise
use of funds. He suggested obtaining a waiver for the smaller
systems.
Mr. Easton responded that when the federal regulations were being
considered, the Alaska department did make such a request for an
exemption. However, the effort was unsuccessful, and he said
chances for obtaining a waiver at this point are "fairly small".
Senator Leman suggested there could be a policy change under the
new Bush Administration.
Fine Particulate Monitoring
$477,200
Reference No.: 33827
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2004
Fine particulate matter is a by product of combustion and has
been linked to respiratory ailments and various cancers. This
federally mandated project provides installation and operation
of fine particulate monitoring equipment throughout the state
to evaluate the risk to public health in Alaska.
TOM CHAPPLE, Director, Division of Air and Water Quality,
Department of Environmental Conservation, testified the intent of
this on-going program is to address new federal health standards.
He explained the program to collect data over a three-year period
and using this data to develop a mitigation plan to control the
pollutants.
Co-Chair Kelly asked if the mitigation plans would require general
funds.
Mr. Chapple replied that other pollutant mitigation plans are
funded with federal grants with some general funds. He surmised
this would most likely be the case with these projects.
Environmental Monitoring and Assessment Program
$1,000,000
Reference No.: 33990
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2004
This project establishes baseline information to determine
whether Alaska's coastal waters are improving, deteriorating,
or staying the same.
Mr. Chapple informed this project is part of a nationwide effort,
which began on the East Coast and utilizes federal funds.
Hazardous Material Response Capabilities for Local Government
$500,000
Reference No.: 33912
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
This project provides funding to establish and maintain a
statewide hazardous materials response capability by
increasing local government response capabilities. Specific
geographic response strategies and tactics for the protection
of environmentally sensitive areas and areas of public concern
that have the highest priority for protection will also be
developed.
Mr. Dietrick stated this appropriation utilizes Oil and Hazardous
Substance Release Prevention and Response funds. He asserted this
project is the result of a "landmark agreement" with the Anchorage
and Fairbanks Hazardous Materials teams, whereby 30 other Alaskan
communities can obtain the teams' assistance. He noted these funds
would be allocated to the Anchorage and Fairbanks teams to allow
them to maintain a state of readiness, and in exchange, they would
be available to respond to situations elsewhere in the state, such
as in remote locations and involving the Alaska Railroad. He
informed that some complications such as workers' compensation
liability issues have been resolved. He said drills have been
conducted in Petersburg, Dutch Harbor and Kodiak and drills in
other areas are planned.
Grants and Loans for Cleanup of Underground Storage Tanks
$$1,000,000
Reference No.: 33939
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Cleanup grants, based on net worth, and low-interest loans to
existing applicants to minimize the financial burden imposed
on tank owners and operators by federal and state
requirements.
Storage Tank
Mr. Dietrick pointed out the funding source is the same as the
previous item. He reminded of "significant problems" with
eligibility requirements for tank owners in the past and stated
this appropriation addresses those applicants and provides loans
for 30 applicants along with continuation grants for 30 other
clean-up projects from FY 02.
Oil and Gas Transportation: Aging Infrastructure Issues
$$500,000
Reference No.: 33914
AP/AL: Appropriation
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2003
Oil Spill Prevention: Safe Transportation of Oil: Safe
transportation of oil can be enhanced by addressing the key
technical issues associated with Alaska's aging
infrastructure. Oil spills will be prevented by evaluating
pipeline and tank integrity issues and by evaluating best
available technology (BAT).
Mr. Dietrick stated this appropriation is also composed of Oil and
Hazardous Substance Release Prevention and Response funds. He spoke
of new oil exploration activity in Cook Inlet and the Kenai Area
and the aging infrastructure utilized. He remarked this project
would address statutory oil spill prevention standards adopted in
1990. He listed the three focuses of the project as follows.
· Work with industry, particularly in Cook Inlet, to
do a pipeline risk assessment
· Review corrosion and erosion problems, which he
noted is the source of some of the recent North
Slope spill incidents
· Investigate the applicability of best available
technology and select the method most appropriate
for Alaska
· Evaluate the applicability of API standards
Mr. Dietrick stressed the purpose of these efforts are to sustain
the existing infrastructure.
Amchitka Workers Health Assessment Project
$2,340,000
Reference No.: 33987
AP/AL: Appropriation
Category: Health/Safety
Location: Amchitka
Election District: Aleutians
Estimated Project Dates: 07/01/2001 - 06/30/2004
This project carries out the Amchitka Worker's Health
Assessment and Medical Screening Program for people that
worked at the Amchitka Island nuclear test site.
Mr. Chapple presented this item.
SFC 01 # 42, Side A 07:40 PM
Mr. Chapple told of the Department's efforts to evaluate the
medical conditions of people present during the nuclear testing
period. He stated the intent is to ascertain which illnesses were
caused by the nuclear activities and to help determine the adequate
federal compensation.
ADJOURNMENT
Co-Chair Pete Kelly adjourned the meeting at 07:43 PM
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