Legislature(2009 - 2010)

04/07/2010 04:13 PM FIN


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04:13:31 PM Start
04:13:47 PM SB230
04:28:32 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                 SENATE FINANCE COMMITTEE                                                                                       
                       April 7, 2010                                                                                            
                         4:13 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
4:13:31 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair Stedman called the Senate Finance Committee                                                                            
meeting to order at 4:13 p.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Charlie Huggins, Vice-Chair                                                                                             
Senator Johnny Ellis                                                                                                            
Senator Dennis Egan                                                                                                             
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
None                                                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Miles Baker, Staff, Co-Chair Stedman                                                                                            
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
None                                                                                                                            
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
SB 230 BUDGET: CAPITAL, SUPP. & OTHER APPROPS                                                                                   
                                                                                                                                
     SB 230 was HEARD and HELD in Committee for further                                                                         
     consideration.                                                                                                             
                                                                                                                                
SB 220 was SCHEDULED but not HEARD.                                                                                             
                                                                                                                                
SENATE BILL NO. 230                                                                                                           
                                                                                                                                
     "An Act making and amending appropriations, including                                                                      
     capital appropriations, supplemental appropriations,                                                                       
     and other appropriations; making appropriations to                                                                         
     capitalize funds; and providing for an effective                                                                           
     date."                                                                                                                     
                                                                                                                                
4:13:47 PM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  MOVED to adopt  the CS to SB  230, labeled                                                                    
26-GS2824\E, Kane, 4/7/10 as  the working document. Co-Chair                                                                    
Stedman OBJECTED.                                                                                                               
                                                                                                                                
MILES  BAKER, STAFF,  CO-CHAIR  STEDMAN,  discussed the  two                                                                    
report packets  included in  the CS.  He stated  that packet                                                                    
number  one  separates  the  bill  by  columns.  Column  one                                                                    
includes the  supplemental capital,  which was  submitted by                                                                    
the governor as the  2010 capital supplemental items. Column                                                                    
two describes the governor's  deferred maintenance bill with                                                                    
some  modifications. Column  three  is  considered the  2011                                                                    
capital budget. Column four  includes grants to municipality                                                                    
named  recipients with  a 2010  effective date.  Column five                                                                    
includes  the  cruise  head  tax  projects  and  column  six                                                                    
comprises the total.                                                                                                            
                                                                                                                                
Mr.  Baker continued  with packet  two,  which is  organized                                                                    
differently.  He began  with column  one including  items in                                                                    
the budget  and one  of the  three governor's  bills. Column                                                                    
two   includes   the   Senate  Committee   Substitute   (CS)                                                                    
additions. The  bottom of the  column shows that  the Senate                                                                    
CS added  $514.7 million. Column  three is the total  of the                                                                    
first  two  with  $2.2 billion.  Column  four  includes  the                                                                    
governor's   original  submission   and  the   final  column                                                                    
comprises the  changes between the governor's  total and the                                                                    
Senate Finance Committee CS.                                                                                                    
                                                                                                                                
4:17:17 PM                                                                                                                    
                                                                                                                                
Mr.  Baker  highlighted  Section  1,  Pages  2-6,  the  FY10                                                                    
supplemental capital  budget. Sections 2 and  3 are included                                                                    
in Section  1 as the total.  Section 4 begins on  Page 8 and                                                                    
includes  the   deferred  maintenance  budget   section.  He                                                                    
pointed  out  Page  8,  Line 10  and  the  governor's  house                                                                    
deferred  maintenance   addition  of  $6  million.   Page  9                                                                    
addresses $5  million in  deferred maintenance  for hatchery                                                                    
facility upgrades.  Section 7, Page 17-52  includes the 2011                                                                    
capital budget. He  continued that Page 18,  Line 9 includes                                                                    
the  $4  million for  the  Kodiak  launch complex.  Line  16                                                                    
includes $10  million to the  Alaska Energy  Authority (AEA)                                                                    
for  the  Railbelt large  scale  hydro  planning design  and                                                                    
permitting   as   recommended   by  the   Senate   Resources                                                                    
Committee. He noted  that Page 22, Lines  13-20 exhibits the                                                                    
Village Safe  Water and Wastewater  infrastructure projects.                                                                    
The program is  structured differently in the  bill, but the                                                                    
amounts   have  not   changed.  The   governor's  submission                                                                    
allocated  funds  on  a straight  percentage  basis  against                                                                    
their deferred maintenance list,  which is not reflective of                                                                    
the funding  destination. He  explained that  the allocation                                                                    
was separated  into two separate allocations,  one for $29.1                                                                    
million  for  the  first  time   service  projects  and  the                                                                    
remaining  $19.4 million  for expansion  upgrade replacement                                                                    
of existing service provided in  the communities. He pointed                                                                    
out that Page 22 also  addresses the municipal water, sewer,                                                                    
and  solid waste  facilities grant  program. The  governor's                                                                    
budget funded  the first  ten projects  in the  program. The                                                                    
Senate  CS  funds  an  additional  ten  projects  for  $19.7                                                                    
million. He continued with Page  51, Line 26 with the Senate                                                                    
CS adding $24 million for  the Alaska Court System including                                                                    
their  number one  priority  of $18  million  for the  Boney                                                                    
Courthouse Campus in Anchorage.                                                                                                 
                                                                                                                                
4:21:48 PM                                                                                                                    
                                                                                                                                
Mr. Baker reiterated  that Section 10, Page  59 is presented                                                                    
slightly differently. Typically, the  section is included in                                                                    
the 2011 Capital budget. This  year the grants were removed.                                                                    
The section  has a  2010 effective  date enabling  the grant                                                                    
money  to  go  out  immediately. The  total  for  the  grant                                                                    
section  as  listed  on the  report  is  approximately  $400                                                                    
million.  Section   13  includes  the  cruise   ship  funded                                                                    
projects, which  are typically separate. The  funding source                                                                    
is documented as "other funds."  The "other fund" source was                                                                    
extensive in the past, but  currently is exhibited in one of                                                                    
two general fund categories, but  the cruise ship funding is                                                                    
considered "other  funds" due to its  restricted nature. The                                                                    
total spending for cruise ship  funding is $45 million, with                                                                    
$33  million in  the commercial  passenger vessel  funds and                                                                    
$11.7  in regional  impact  funds.  The governor's  original                                                                    
proposal had $21 million in  spending for the line item. The                                                                    
remainder  of the  language section  begins on  Page 90.  He                                                                    
pointed out  that Section 17  includes $140 million  for the                                                                    
Alaska  Gasline   Inducement  Reimbursement  Fund.   The  CS                                                                    
removes the  money from the  general fund as opposed  to the                                                                    
Alaska   Capital  Income   Corporation  as   was  originally                                                                    
proposed.  Line 28,  Page 90  shows $50  million in  general                                                                    
funds for  the Renewable Energy  Fund, which is  $25 million                                                                    
above the  governor's request as  recommended by  the Senate                                                                    
Resources Committee.                                                                                                            
                                                                                                                                
Mr. Baker continued with Line  30 and Power Project fund for                                                                    
$10  million,   $3  million  greater  than   the  governor's                                                                    
request,  also  a  recommendation of  the  Senate  Resources                                                                    
Committee work on the omnibus  energy plan. Section 20, Page                                                                    
91  includes the  National  Petroleum Reserve-Alaska  (NPRA)                                                                    
grants. He  pointed out that  Section 21, Page 92  shows the                                                                    
projected  earnings  for the  Renewable  Energy  Fund of  $2                                                                    
million.  The earnings  are  reappropriated  back to  Alaska                                                                    
Energy  Authority  (AEA)  for   the  cost  of  managing  the                                                                    
Renewable  Energy  Grant  Program.  Section  24  includes  a                                                                    
reappropriation  of $5.5  million to  the Alaska  Center for                                                                    
Treatment Planning and Design in Anchorage.                                                                                     
                                                                                                                                
4:26:15 PM                                                                                                                    
                                                                                                                                
Mr. Baker discussed  Section 26, Page 93 as  the $60 million                                                                    
transfer from the Marine Highway  Vessel Replacement Fund to                                                                    
the  new  Alaska  class  ferry.   Section  27,  Page  94-104                                                                    
exhibits the legislative lapsing  grants or scope changes of                                                                    
previous   legislative   projects  requested   through   the                                                                    
Senators.                                                                                                                       
                                                                                                                                
Co-Chair Stedman WITHDREW his OBJECTION.                                                                                        
                                                                                                                                
Version E was ADOPTED.                                                                                                          
                                                                                                                                
Co-Chair   Stedman  commented   that   the  Senate   Finance                                                                    
Committee added $500 million  to the capital appropriations,                                                                    
which  is a  job oriented  bill. The  committee worked  last                                                                    
session  to  reduce  approximately  $488  million  from  the                                                                    
capital  budget.   He  informed  that  the   committee  will                                                                    
continue work on  the bill with potential for  another CS on                                                                    
Friday.                                                                                                                         
                                                                                                                                
4:28:32 PM                                                                                                                    
                                                                                                                                
Mr. Baker  acknowledged the  contributions of  Rob Carpenter                                                                    
and  Amy  Fosket in  the  Legislative  Finance Division  and                                                                    
Weston Eiler, staff to Senator Stedman.                                                                                         
                                                                                                                                
Co-Chair Stedman  credited the  crew for working  long hours                                                                    
for many days to prepare the document.                                                                                          
                                                                                                                                
Co-Chair Hoffman  stated that  the Senate  Finance Committee                                                                    
agreed to save  $1.5 billion of the  additional $2.2 billion                                                                    
in surplus  for 2010. He  explained that $1.1  million would                                                                    
forward  fund education  and $400  million would  settle the                                                                    
Constitutional  Budget Reserve  (CBR).  He  opined that  the                                                                    
action addresses  most of the  capital needs  throughout the                                                                    
state. He viewed  this as a "catch up and  a jobs" bill that                                                                    
will meet the needs of the communities throughout Alaska.                                                                       
                                                                                                                                
Co-Chair  Stedman commented  that  the  current position  of                                                                    
savings for the state is  approximately $10 billion with $12                                                                    
billion forecasted within the next 18 months.                                                                                   
                                                                                                                                
SB  230  was  HEARD  and   HELD  in  Committee  for  further                                                                    
consideration.                                                                                                                  
                                                                                                                                
SB 220 was SCHEDULED but not HEARD.                                                                                             
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
The meeting was adjourned at 4:31 PM.                                                                                           

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