Legislature(2003 - 2004)

05/13/2003 09:59 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                           May 13, 2003                                                                                       
                              9:59 AM                                                                                         
                                                                                                                                
                                                                                                                                
TAPES                                                                                                                       
                                                                                                                                
SFC-03 # 91, Side A                                                                                                             
                                                                                                                              
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Gary Wilken convened  the meeting at approximately 9:59 AM.                                                            
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Lyda Green, Co-Chair                                                                                                    
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Con Bunde, Vice Chair                                                                                                   
Senator Ben Stevens                                                                                                             
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
Senator Robin Taylor                                                                                                            
                                                                                                                                
Also Attending:  LARRY PERSILY, Deputy  Commissioner, Office  of the                                                          
Commissioner, Department  of Revenue; TOM LAWSON, Director, Division                                                            
of Administrative  Services,  Department of  Community and  Economic                                                            
Development;  NANCY  SLAGLE, Director,  Division  of Administrative                                                             
Services, Department of Transportation and Public Facilities                                                                    
                                                                                                                                
Attending   via  Teleconference:   There   were  no  teleconference                                                           
participants.                                                                                                                   
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SB 102-CHARITABLE GAMING REVENUE                                                                                                
                                                                                                                                
The  Committee  heard testimony  from  the  Department  of  Revenue,                                                            
considered  but did not adopt one  amendment, and reported  the bill                                                            
from Committee.                                                                                                                 
                                                                                                                                
SB 100-APPROP: CAPITAL PROJECTS                                                                                                 
                                                                                                                                
The Committee  adopted six  amendments and  a seventh amendment  was                                                            
withdrawn from  consideration. The Department of Transportation  and                                                            
Public Facilities  answered  Committee questions,  and the  bill was                                                            
held in Committee.                                                                                                              
                                                                                                                                
SB 213-KNIK ARM BRIDGE AND TOLL AUTHORITY                                                                                       
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
SB 202-EDUCATION FUNDING &PUPIL TRANSPORTATION                                                                                  
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
HB 165-COMMUNITY SCHOOLS                                                                                                        
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
HB 171-REPEAL CHARTER SCHOOL GRANTS                                                                                             
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
HB 174- CORRESPONDENCE STUDY                                                                                                    
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
HB 154-UNDER SCHOOL AGE STUDENTS                                                                                                
                                                                                                                                
The bill was scheduled but not heard.                                                                                           
                                                                                                                                
                                                                                                                                
     CS FOR SENATE BILL NO. 102(L&C)                                                                                            
     "An Act increasing the amount of revenue received by the state                                                             
     from charitable gaming activities; relating to taxes on pull-                                                              
     tabs; and providing for an effective date."                                                                                
                                                                                                                                
                                                                                                                                
This was  the second  hearing for  this bill in  the Senate  Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
LARRY  PERSILY,   Deputy   Commissioner,   Department  of   Revenue,                                                            
explained  to  the  Committee  that while  the  Department  has  not                                                            
finalized  its  determination   as  to  whether  charitable   gaming                                                            
operations  should be  exempt from  a proposed  three percent  State                                                            
sales and use tax, he recommended  "the specific exemption" of pull-                                                            
tab operations  as  he opined  that it  would incur  "an unfair  and                                                            
excessive burden" on those operations.                                                                                          
                                                                                                                                
Co-Chair  Wilken noted  that this  issue has  also been  a point  of                                                            
discussion in separate legislation.                                                                                             
                                                                                                                                
Senator  Bunde asked whether  the Committee  should further  discuss                                                            
this legislation's affect on the local sales tax issue.                                                                         
                                                                                                                                
Co-Chair Wilken  voiced that rather  than continuing to discuss  the                                                            
issue  in this  Committee, the  intent is  to report  the bill  from                                                            
Committee  and  allow  the  issue  to  be  addressed  by  subsequent                                                            
committees   once  the   Department   of  Revenue   has  reached   a                                                            
determination regarding  whether charitable gaming operations should                                                            
be exempt from the proposed statewide sales tax.                                                                                
                                                                                                                                
Senator Bunde moved to report the bill from Committee.                                                                          
                                                                                                                                
Senator Olson objected to the motion.                                                                                           
                                                                                                                                
Senator  Bunde   withdrew  the  motion  to  report   the  bill  from                                                            
Committee.                                                                                                                      
                                                                                                                                
There being no objection, the motion was WITHDRAWN.                                                                             
                                                                                                                                
AT EASE 10:04 AM / 10:06 AM                                                                                                     
                                                                                                                                
[NOTE: Due to  technical difficulties, the following  portion of the                                                            
meeting is not recorded.]                                                                                                       
                                                                                                                                
Amendment #1:  This amendment inserts new language  into the bill as                                                            
follows.                                                                                                                        
                                                                                                                                
Page 1, line 1:                                                                                                                 
      Following "Act" insert "relating to charitable gaming;"                                                                   
                                                                                                                                
Page 1, following line 13: Insert a new bill section to read:                                                                   
                                                                                                                                
     Sec.2. AS 05.15.180(g) is amended to read:                                                                                 
     (g)  A municipality  or a  qualified organization  may award  a                                                            
     maximum  of  $1,500,000 [$1,000,000]  in  prizes  each year  in                                                            
     activities  authorized   under  this  chapter;  however,  if  a                                                            
     municipality  or  a qualified  organization  contracts with  an                                                            
     operator  to conduct on its behalf activities  authorized under                                                            
     this chapter,  the municipality  or qualified organization  may                                                            
     award  a maximum of $500,000  in prizes each year. The  holders                                                            
     of  a multiple-beneficiary  permit  under  AS 05.15.100(d)  may                                                            
     award  a maximum in  prizes each year  of $1,000,000 times  the                                                            
     number  of holders  of  the permit  for  activities  authorized                                                            
     under this chapter.  In this subsection, "activities authorized                                                            
     under  this  chapter"  means  all activities  subject  to  this                                                            
     chapter other than bingo."                                                                                                 
                                                                                                                                
Senator Olson moved to adopt Amendment #1.                                                                                      
                                                                                                                                
Co-Chair Green objected.                                                                                                        
                                                                                                                                
Senator Olson  commented that this amendment would  allow charitable                                                            
gaming operators to increase  the maximum level of prize money being                                                            
awarded  from one million  dollars  to $1.5 million.  He noted  that                                                            
this  increase is  supported  by the Iditarod  Trail  Sled Dog  Race                                                            
organization  because the prize payout  limit, which was  adopted in                                                            
1988, has  become a  limiting factor  in the  continuing growth  and                                                            
success of the  Race. He stated that a letter [copy  on file], dated                                                            
May  6, 2003,  from  the  Iditarod  Trail  Sled  Dog Race  has  been                                                            
provided to Committee members.                                                                                                  
                                                                                                                                
Mr. Persily stated  that the downside of the amendment  is that some                                                            
operators offer games on  a rotation basis. Therefore, he continued,                                                            
a game with a  higher payout might delay the play  of the subsequent                                                            
game.                                                                                                                           
                                                                                                                                
Co-Chair Wilken  asked whether the Iditarod Trail  Sled Dog Race has                                                            
reached the million-dollar prize limit.                                                                                         
                                                                                                                                
Senator Olson responded yes, as is specified in the letter.                                                                     
                                                                                                                                
Co-chair  Wilken  clarified  that  the  letter  specifies  that  the                                                            
organization has "come dangerously close."                                                                                      
                                                                                                                                
Senator Olson  noted that the concern that the play  of another game                                                            
might be delay does not apply in the case.                                                                                      
                                                                                                                                
Co-Chair  Green  asked  whether  the  amendment  could specifically                                                             
exempt the Iditarod  Sled Dog Race rather than the  whole "universe"                                                            
of operators from the current prize limitation.                                                                                 
                                                                                                                                
Co-Chair Wilken stated  that he could not support this amendment, as                                                            
further study on its ramifications is necessary.                                                                                
                                                                                                                                
Mr.   Persily   assured   that   the   Department    would   provide                                                            
recommendations  regarding  the  downstream  affect of  raising  the                                                            
prize limit.                                                                                                                    
                                                                                                                                
Senator  Taylor  interjected  that  raising the  prize  limit  would                                                            
generate additional revenue.                                                                                                    
                                                                                                                                
Mr. Persily responded  that this might be correct  for the specified                                                            
entity; however, he continued  that the question is whether it would                                                            
negatively affect other entities' games.                                                                                        
                                                                                                                                
Senator  Taylor  clarified the  intent  of his  comment  to be  that                                                            
raising the  limit would raise more  money for the State  as well as                                                            
for the entity.                                                                                                                 
                                                                                                                                
Co-Chair Wilken  voiced that the issue must be further  developed to                                                            
determine the range of ramifications.                                                                                           
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR: Senator Hoffman, Senator Olson, and Senator Taylor                                                                    
                                                                                                                                
OPPOSED:  Senator Bunde,  Senator  Stevens, Co-chair  Green and  Co-                                                            
chair Wilken                                                                                                                    
                                                                                                                                
The motion FAILED (3-4)                                                                                                         
                                                                                                                                
Amendment #1 FAILED to be adopted.                                                                                              
                                                                                                                                
Senator  Bunde  moved  to  report  the  bill   from  Committee  with                                                            
individual recommendations and accompanying fiscal note.                                                                        
                                                                                                                                
Senator Hoffman objected.                                                                                                       
                                                                                                                                
Senator  Taylor objected.  He  voiced  concern regarding  the  local                                                            
sales tax issue.                                                                                                                
                                                                                                                                
Mr.  Persily affirmed  that  the bill  does not  include  provisions                                                            
addressing local sales taxes.                                                                                                   
                                                                                                                                
Co-Chair  Wilken   reiterated  that  the  issue  would   be  further                                                            
addressed   in  subsequent  committees   upon  the  issuance   of  a                                                            
recommendation  from  the  Department  of  Revenue  regarding  local                                                            
taxation on pull-tab games.                                                                                                     
                                                                                                                                
Senator Taylor  clarified that a pull-tab operation  would be paying                                                            
the equivalent  of a six percent tax were a three  percent local tax                                                            
and a three-percent State tax imposed.                                                                                          
                                                                                                                                
Co-Chair Wilken affirmed that the issue would be addressed.                                                                     
                                                                                                                                
A roll call was taken on the motion.                                                                                            
                                                                                                                                
IN FAVOR:  Senator Ben  Stevens, Senator  Bunde, Co-chair Green  and                                                            
Co-chair Wilken                                                                                                                 
                                                                                                                                
OPPOSED: Senator Taylor, Senator Hoffman and Senator Olson                                                                      
                                                                                                                                
The motion PASSED (4-3)                                                                                                         
                                                                                                                                
CS SB 102(L&C)  was REPORTED from  Committee with fiscal  note #2 in                                                            
the amount of $180,000 from the Department of Revenue.                                                                          
                                                                                                                                
AT EASE 10:18 AM / 10:20 AM                                                                                                     
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 100                                                                                                        
     "An  Act making capital  appropriations  and reappropriations;                                                             
     capitalizing a fund;  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."                                                                                                           
                                                                                                                                
                                                                                                                                
This was the fourteenth  hearing for this bill in the Senate Finance                                                            
Committee.                                                                                                                      
                                                                                                                                
[NOTE: Recording resumes.]                                                                                                      
                                                                                                                                
Amendment  #22: This amendment  inserts a new  bill section  on page                                                            
77, following line 30 to read as follows:                                                                                       
                                                                                                                                
          Sec. 12. Department of Natural Resources. (a) The sum of                                                              
     $2,000,000  is  appropriated  from  federal receipts  from  the                                                            
     national  coastal wetlands  conservation  grant program  to the                                                            
     Department  of  Natural  Resources   for  land  acquisition  on                                                            
     Northern Afognak Island for the Perenosa Bay project.                                                                      
          (b) The sum of $10,450,000 is appropriated from the Exxon                                                             
     Valdez  oil spill settlement  trust recognized as AS  37.14.400                                                            
     to the Department  of Natural Resources for land acquisition on                                                            
     Northern Afognak Island for the Perenosa Bay project.                                                                      
                                                                                                                                
Senator Bunde  moved for the adoption of Amendment  #22. He informed                                                            
that this amendment  would increase  funding for the acquisition  of                                                            
land on Northern  Afognak Island. He informed that  funding would be                                                            
provided by the Exxon Valdez oil spill settlement trust.                                                                        
                                                                                                                                
Co-Chair Wilken objected for clarification.                                                                                     
                                                                                                                                
Senator Bunde explained  that this amendment would allow for federal                                                            
receipt funds  and funds from the Exxon Valdez oil  spill settlement                                                            
fund  to  be   available  to  provide   national  coastal   wildlife                                                            
conservation grants  for the acquisition of land on  Afognak Island.                                                            
                                                                                                                                
Co-Chair Wilken withdrew the objection.                                                                                         
                                                                                                                                
There being no further objection, Amendment # 22 was ADOPTED.                                                                   
                                                                                                                                
Amendment  #16: This amendment  adds a  "Federally Funded  Landowner                                                            
Incentive Program  - Bristol Bay/North Aleutians project"  component                                                            
in the  Department  of Fish  and Game  and  appropriates  $1,642,500                                                            
federal funds on page 24, following line 16.                                                                                    
                                                                                                                                
Senator Hoffman moved for adoption of Amendment #16.                                                                            
                                                                                                                                
Co-Chair Wilken objected for discussion.                                                                                        
                                                                                                                                
Senator Hoffman  explained that the purpose of this  amendment is to                                                            
clarify that  the land in question  would be purchased from  village                                                            
corporations  to provide the  public access  to hunting and  fishing                                                            
areas.                                                                                                                          
                                                                                                                                
Senator Taylor  commented that "it  is the epitome of arrogance  for                                                            
us as a legislative  body to make a decision that  the perpetual use                                                            
of land must be dedicated  to a given purpose," as, by doing so, the                                                            
designation  would prohibit  other unforeseen  uses of the  land. He                                                            
stated  that over  time,  the needs  of the  area  might change  and                                                            
development  of  the  area  might  be  negatively  impacted  by  the                                                            
restrictions  on land use that a park  designation would  entail. He                                                            
opined that,  "locking up"  thousands of acres  of land through  the                                                            
implementation  of such things  as "conservation  easements,"  as in                                                            
this situation, "is shallow, bad public policy."                                                                                
                                                                                                                                
Without further objection, Amendment #16 was ADOPTED.                                                                           
                                                                                                                                
Amendment #17:  This amendment adds  a "Ketchikan Gateway  Borough -                                                            
Ketchikan   Shipyard  (ED  1)"  component   and  $1,500,000   Alaska                                                            
Industrial  Development  and  Export  Authority   (AIDEA)  Corporate                                                            
Receipts   appropriation    to   the   Grants   to   Municipalities                                                             
(AS37.05.315)  BRU  in  the Department  of  Community  and  Economic                                                            
Development on page p, lines 21 and 22.                                                                                         
                                                                                                                                
Senator Taylor moved for adoption of Amendment #17.                                                                             
                                                                                                                                
Senator Taylor stated that  this amendment allows for the leveraging                                                            
of State  money to support  a State asset  as he communicated  AIDEA                                                            
owns the  shipyard facility.  He stated that  new jobs and  expanded                                                            
facilities would be the result of this investment.                                                                              
                                                                                                                                
Co-Chair  Wilken   objected  to  the  motion.  He   noted  that  the                                                            
Department  recommends  the use of  general fund  money rather  than                                                            
AIDEA funding as the preferred  funding source as he understood that                                                            
AIDEA corporate receipt  funding was unavailable. He deferred to Co-                                                            
Chair  Green  to  verify  whether  the  $18  million   general  fund                                                            
allocation is included in the operating budget.                                                                                 
                                                                                                                                
AT EASE 10:30 AM / 10:31 AM                                                                                                     
                                                                                                                                
Co-Chair Green confirmed  that the AIDEA funding source would not be                                                            
available.  She affirmed that the  Department has requested  general                                                            
fund  as the  funding source,  and  she stated  that  the action  of                                                            
funding the  request with  corporate receipts  would be the  same as                                                            
using general  funds as the AIDEA corporate receipts  are considered                                                            
general funds.                                                                                                                  
                                                                                                                                
Senator Taylor asked for  clarification that the $18 million funding                                                            
request is included  in the operating budget, as he  understood that                                                            
the  operating  budget  was  established  before  this  request  was                                                            
submitted.                                                                                                                      
                                                                                                                                
Co-Chair  Green commented  that there is  "a magnetic attraction  to                                                            
any fiscal note that has income."                                                                                               
                                                                                                                                
Senator  Taylor   asked  whether   the  House  and  Senate   Finance                                                            
Conference  Committee amended  the operating  budget in relation  to                                                            
this item.                                                                                                                      
                                                                                                                                
Senator Hoffman  clarified  that using $18  million of general  fund                                                            
would reduce  the draw on the CBR  and that using AIDEA funds  would                                                            
counter that effort.                                                                                                            
                                                                                                                                
Co-Chair Green reiterated  that using AIDEA funding could be likened                                                            
to using general funds.                                                                                                         
                                                                                                                                
Senator Taylor  stated therefore  that that  is the reason  that the                                                            
original intent  of the request was  to use general funds;  however,                                                            
he  continued   that  Governor  Frank   Murkowski's  administration                                                             
indicated  that  an $18  million  AIDEA dividend  funding  would  be                                                            
forthcoming.  He  stated  that  this  amendment   resulted  from  an                                                            
Administrative  request to  utilize AIDEA  dividends as the  funding                                                            
source  for  this  request.  He  was  unaware   whether  a  decision                                                            
regarding the $18 million funding had been identified.                                                                          
                                                                                                                                
TOM LAWSON,  Director,  Division  of Administration,  Department  of                                                            
Community  and  Economic  Development,  informed   that legislation                                                             
regarding the  status of the AIDEA  dividend is being discussed.  He                                                            
interpreted this  amendment to specify that $1.5 million  in funding                                                            
would  be  from AIDEA  corporate  receipts  that  he  disclosed  are                                                            
unavailable.  He  stated  that identifying  $1.5  million  in  AIDEA                                                            
funding would  "threaten"  the rating of  AIDEA bonds. He  commented                                                            
that neither  the Department of Community  and Economic Development                                                             
nor AIDEA requested AIDEA funding to support this project.                                                                      
                                                                                                                                
Senator Taylor asked to  clarify that the funding in question should                                                            
be correctly identified as AIDEA "dividends."                                                                                   
                                                                                                                                
Mr. Lawson responded that is correct.                                                                                           
                                                                                                                                
Senator Taylor asked whether  amending Amendment #17 to specify that                                                            
funding source as AIDEA dividends might address the issue.                                                                      
                                                                                                                                
Mr. Lawson  responded that he would  require more information  about                                                            
the  issue of  the AIDEA  dividend  appropriation  into the  general                                                            
fund,  but he  stated that  there  is currently  "serious  concerns"                                                            
regarding the  identification of "AIDEA  corporate receipts"  as the                                                            
funding source of this request.                                                                                                 
                                                                                                                                
Senator Taylor voiced further  concern regarding the appropriateness                                                            
of the AIDEA corporate  dividend being earmarked as general fund. He                                                            
voiced confusion  as to whether to  identify the funding  source for                                                            
this request as corporate  receipts, corporate dividends, or general                                                            
funds. He stressed  that AIDEA needs  the facility in Ketchikan  and                                                            
that  the  amendment  was offered  on  their  behalf;  therefore  he                                                            
declared that the funding source should be identified.                                                                          
                                                                                                                                
Co-Chair Wilken  stated that the capital  budget was developed  with                                                            
certain  funding  restraints  and  in order  to  include  this  $1.5                                                            
million  request in  the budget, another  project  would need  to be                                                            
eliminated. He stated that  inclusion of this project would increase                                                            
the CBR draw by $1.5 million.                                                                                                   
                                                                                                                                
Co-Chair  Green  requested  that the  amendment  be  withdrawn  from                                                            
consideration to be re-addressed upon further review.                                                                           
                                                                                                                                
Senator Taylor offered  to withdraw the motion to adopt Amendment 17                                                            
with the understanding that it would be re-addressed.                                                                           
                                                                                                                                
Without objection, Amendment #17 was WITHDRAWN.                                                                                 
                                                                                                                                
Amendment   #18:   This   amendment   reduces   the   general   fund                                                            
appropriation  to the "Alaska Land  Mobile Radio (ED 99)"  component                                                            
in  the Department  of  Administration  on  page  2, line  10,  from                                                            
$680,000 to $527,000  without negatively impacting  the ALMR {Alaska                                                            
Land Mobile Radio}  program. The $153,000 reduction  is derived form                                                            
the following sources.                                                                                                          
                                                                                                                                
                             rd                                                                                                 
     Eliminate  the planned 3   party project review      $100,000                                                              
     Eliminate updating the communications plan             25,000                                                              
     Prepare joint procurement plan in-house                18,000                                                              
     Reduction in Overhead, supplies, and travel            10,000                                                              
          Total                                           $153,000                                                              
                                                                                                                                
Co-Chair  Wilken  moved  for  the  adoption  of  the  amendment  and                                                            
objected  for clarification.  He  explained  that this  CIP  request                                                            
could be lowered without impacting the program.                                                                                 
                                                                                                                                
Without objection, Amendment #18 was ADOPTED.                                                                                   
                                                                                                                                
Amendment  #19: This  amendment adds  a "Pt.  McKenzie Agricultural                                                             
Equipment    (ED  13-16)"   component  and  $100,000   general  fund                                                            
appropriation   to  the  Department  of  Corrections   on  page  14,                                                            
following  line  14.  Accompanying  explanatory  language  reads  as                                                            
follows.                                                                                                                        
                                                                                                                                
     The Governor's  FY 04 operating  budget included a request  for                                                            
     $100,000  to upgrade outdated  equipment and obtain  additional                                                            
     farm  equipment  for the  purpose  of increased  production  of                                                            
     livestock  feed  and consumable  vegetables  for  the  prisoner                                                            
     population                                                                                                                 
                                                                                                                                
     The  House [of Representatives]  denied  this increment  in the                                                            
     operating   budget   with  the   intent  it   be  placed   more                                                            
     appropriately  in the capital  budget. The Senate accepted  the                                                            
     increment.  Therefore,  the  item came  before  the  Conference                                                            
     Committee on HB 75/HB 76.                                                                                                  
                                                                                                                                
     The  Conference Committee  agreed with  the House's action  and                                                            
     deleted  it from the operating  budget with the intent  that it                                                            
     be funded in the FY 04 capital budget.                                                                                     
                                                                                                                                
Co-Chair Green moved for adoption of Amendment #19.                                                                             
                                                                                                                                
Co-Chair Wilken objected for explanation                                                                                        
                                                                                                                                
Co-Chair  Green   explained  that  the  Governor's  capital   budget                                                            
included  $100,000 for  Point McKenzie  agriculture  equipment,  and                                                            
that  during  a  House  of Representatives   and  Senate  Conference                                                            
Committee meeting,  it was suggested  that this item be transferred                                                             
from the operating budget to the capital budget.                                                                                
                                                                                                                                
Co-Chair Wilken removed the objection.                                                                                          
                                                                                                                                
Without further objection, Amendment #19 ADOPTED.                                                                               
                                                                                                                                
In response  to a  question from  Senator Hoffman,  Co-chair  Wilken                                                            
explained that  the transfer of this item from the  operating budget                                                            
to the capital budget was conducted in Conference Committee.                                                                    
                                                                                                                                
Amendment   #20:   This  amendment   increases   the   other   funds                                                            
appropriation  to the  "State Homeland  Security  Grant Program  (ED                                                            
99)" component  in the Department  of Military and Veterans  Affairs                                                            
from $4,995,000 to $18,225,000 on page 27, lines 7 and 8.                                                                       
                                                                                                                                
Co-Chair  Wilken moved for  adoption of Amendment  #20 and  objected                                                            
for  explanation.  He informed  the  Committee that  this  amendment                                                            
would provide for an additional  authorization of $13.23 million via                                                            
a federal homeland security grant.                                                                                              
                                                                                                                                
Co-Chair Wilken removed the objection.                                                                                          
                                                                                                                                
Without further objection, Amendment #20 was ADOPTED.                                                                           
                                                                                                                                
Amendment  #21:  This  amendment   adds  a "Ted  Stevens   Anchorage                                                            
International  Airport: Terminal  Redevelopment  Project"  component                                                            
and $50,000,000  allocation in the  Airport Improvement Program  BRU                                                            
of the Department  of Transportation  and Public Facilities  on page                                                            
34, line 4.                                                                                                                     
                                                                                                                                
This amendment  also adds  a "Alaska International  Airport  System:                                                            
Finance Costs"  component and $15,100,000 allocation  in the Airport                                                            
Improvement  Program BRU  of the  Department  of Transportation  and                                                            
Public Facilities on page 34, line 4.                                                                                           
                                                                                                                                
Accompanying explanatory language reads as follows.                                                                             
                                                                                                                                
The Department  has requested  these two  additional allocations  to                                                            
the  Airport   Improvement   Program.   The  fund   source  is   the                                                            
International  Airport Construction Fund. The funds  will be used to                                                            
complete  the  construction  of  Concourse  C  at  the  Ted  Stevens                                                            
Anchorage International  Airport and to cover costs  associated with                                                            
issuing airport revenue bonds.                                                                                                  
                                                                                                                                
Co-Chair  Wilken moved  and objected  to the  adoption of  Amendment                                                            
#21.  He explained  that  this amendment  would  provide  additional                                                            
International  Airport Construction  funding  to complete  Concourse                                                            
"C"  construction   at  the  Anchorage  Ted  Stevens  International                                                             
Airport.  He  stated  that  the  funding  would  provide  for  costs                                                            
associated with the issuance of airport revenue bonds.                                                                          
                                                                                                                                
Senator  Olson voiced  that the extent  and expense  of the  airport                                                            
"has caused  a fair amount  of concern" in  the State. He asked  how                                                            
this request  might affect additional  bonding needs of the  airport                                                            
for other projects.                                                                                                             
                                                                                                                                
NANCY  SLAGLE,  Director,   Division  of  Administrative   Services,                                                            
Department  of Transportation and  Public Facilities explained  that                                                            
the$76.6  million bond authorization  provides  for $50 million  for                                                            
Terminal   "C"  completion;   $15.1  million   for  finance   costs;                                                            
approximately  $10 million for Anchorage  Airport CIP projects;  and                                                            
$3.5 million  for the  Fairbanks International  Airport. She  stated                                                            
that this $50 million funding  request would provide for $48 million                                                            
of bond funds,  and $2 million being  made available to finish  "old                                                            
projects."  She clarified that  of the $50  million; $48 million  is                                                            
included in the authorization bill.                                                                                             
                                                                                                                                
Senator  Olson clarified  therefore that this  request provides  for                                                            
that allocation.                                                                                                                
                                                                                                                                
Ms.  Slagle  stated  that this  request  identifies  the  amount  of                                                            
funding required  to complete Concourse  "C." She continued  that of                                                            
that  $50  million,  $48  million  would be  provided  by  new  bond                                                            
issuances and  $2 million is from  "older existing" airport  project                                                            
funds.                                                                                                                          
                                                                                                                                
Senator  Olson   asked  whether  the   projects  at  the   Fairbanks                                                            
International Airport have been identified.                                                                                     
                                                                                                                                
Co-chair  Wilken  and  Ms.  Slagle  established  that  the  projects                                                            
include   a   terminal   project,   security   upgrades   and   ramp                                                            
improvements.                                                                                                                   
                                                                                                                                
Ms. Slagle  noted  that the  projects are  included  in the  capital                                                            
budget request.                                                                                                                 
                                                                                                                                
Senator Hoffman  asked whether this  funding request would  complete                                                            
the Anchorage airport renovation project.                                                                                       
                                                                                                                                
Co-Chair  Wilken  could not  verify  that this  would  be the  final                                                            
funding request.                                                                                                                
                                                                                                                                
There being no further objection, Amendment #21 was ADOPTED.                                                                    
                                                                                                                                
Co-chair Wilken  noted that Amendment #17 would be  revisited at the                                                            
next meeting regarding this bill.                                                                                               
                                                                                                                                
The bill was HELD in Committee.                                                                                                 
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Gary Wilken adjourned the meeting at 10:44 AM.                                                                         

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