Legislature(2021 - 2022)SENATE FINANCE 532

02/03/2021 09:00 AM Senate FINANCE

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Audio Topic
09:01:45 AM Start
09:02:32 AM SB50
11:08:25 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
+ Capital Budget Presentation by Neil Steininger, TELECONFERENCED
OMB Director
                 SENATE FINANCE COMMITTEE                                                                                       
                     February 3, 2021                                                                                           
                         9:01 a.m.                                                                                              
9:01:45 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Bishop called the Senate Finance Committee meeting                                                                     
to order at 9:01 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Senator Click Bishop, Co-Chair                                                                                                  
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson (via teleconference)                                                                                        
Senator Natasha von Imhof                                                                                                       
Senator Bill Wielechowski                                                                                                       
Senator David Wilson                                                                                                            
MEMBERS ABSENT                                                                                                                
ALSO PRESENT                                                                                                                  
Neil Steininger, Director, Office of Management and Budget,                                                                     
Office of the Governor.                                                                                                         
PRESENT VIA TELECONFERENCE                                                                                                    
Bryan Butcher, Chief Executive Officer and Executive                                                                            
Director, Alaska Housing Finance Corporation, Department of                                                                     
SB 50     APPROP: CAP; REAPPROP; SUPP; AMEND                                                                                    
          SB 50 was HEARD and HELD in committee for further                                                                     
SENATE BILL NO. 50                                                                                                            
     "An  Act   making  appropriations,   including  capital                                                                    
     appropriations,     reappropriations,     and     other                                                                    
     appropriations;  making   supplemental  appropriations;                                                                    
     making   appropriations   to  capitalize   funds;   and                                                                    
     providing for an effective date."                                                                                          
9:02:32 AM                                                                                                                    
NEIL STEININGER, DIRECTOR, OFFICE  OF MANAGEMENT AND BUDGET,                                                                    
OFFICE OF THE GOVERNOR,  discussed the presentation, "FY2022                                                                    
Capital  Budget Overview,  SB 50  and  SB 51  - February  2,                                                                    
2021"  (copy on  file).  He noted  that  the capital  budget                                                                    
coordinator for  the Office of  Management and  Budget (OMB)                                                                    
was available via teleconference. He  noted that there was a                                                                    
summary  spreadsheet  document   entitled  "Capital  Project                                                                    
Summary"  (copy on  file) that  would provide  more details.                                                                    
The  first  column   tied  to  the  slide   numbers  of  the                                                                    
presentation,  and  the  second  column  tied  to  the  line                                                                    
numbers on the  slides. The document was a  brief summary of                                                                    
the capital  project write-ups that were  available on OMB's                                                                    
Mr.  Steininger looked  at slide  2, "FY2022  Capital Budget                                                                    
and  Supplemental Overview,"  which showed  a data  table of                                                                    
proposed capital  appropriations. The  projects were  for FY                                                                    
22  and were  in SB  50 (the  governor's capital  budget) as                                                                    
well  as  SB  51  (the mental  health  budget  inclusive  of                                                                    
capital  items).  He  noted  that  there  were  also  FY  21                                                                    
supplemental  projects  that  were under  consideration  and                                                                    
were spread  across three different bills.  The projects had                                                                    
effective dates in  the current fiscal year  and were broken                                                                    
across  three  bills:  SB 50,  the  fast-track  supplemental                                                                    
bill, and the "regular" supplemental bill.                                                                                      
Mr. Steininger  detailed that the Unrestricted  General Fund                                                                    
(UGF) for  the capital  budget was significantly  lower than                                                                    
previous years as a result  of utilization of Alaska Housing                                                                    
Finance Corporation  (AHFC) bonding.  He commented  that the                                                                    
interest rate  and cash position  of the state  were factors                                                                    
in considering  bonding as  a way  to maintain  liquidity. a                                                                    
lot  of  what would  have  been  UGF capital  projects  were                                                                    
represented  in the  "Other funds"  column. There  was about                                                                    
$101 million worth of bonding proposed in SB 50.                                                                                
Mr. Steininger  noted that the Mental  Health Capital Budget                                                                    
included   mostly   annual   recurring   items   that   were                                                                    
recommendations   from  the   Alaska  Mental   Health  Trust                                                                    
Authority (AMHTA). He stated he  would go into detail on all                                                                    
the projects that made up the numbers.                                                                                          
9:06:52 AM                                                                                                                    
Co-Chair  Bishop inquired  about  negative  spending in  the                                                                    
supplemental  as  shown  on  slide   2.  He  pointed  out  a                                                                    
decrement $12.7  million in the  UGF column under  the "SB50                                                                    
Supplemental in Gov" row.                                                                                                       
Mr. Steininger  explained that in  SB 50 there  were repeals                                                                    
of leftover funds  from projects and the  authority would be                                                                    
removed, which  was reflected  as a  negative appropriation.                                                                    
Elsewhere  in  the  operating budget,  the  funds  had  been                                                                    
utilized to  capitalize the Alaska Capital  Income Fund. The                                                                    
funds  showed  a positive  spend  in  the operating  budget,                                                                    
resulting in a net zero.                                                                                                        
Senator von  Imhof asked if  the fund  adjustments described                                                                    
by  Mr. Steininger  were  merely  accounting or  represented                                                                    
cash flow.                                                                                                                      
Mr. Steininger  relayed that  the slide  reflected a  bit of                                                                    
both accounting  and cash flow.  He explained  that tracking                                                                    
operating  and capital  budget items  were  separate in  the                                                                    
state's  accounting  and  budget  systems.  He  stated  when                                                                    
appropriation  authority  was moved  from  one  area to  the                                                                    
other, it  created a negative in  one and a positive  in the                                                                    
other. The  item questioned by Co-Chair  Bishop signified an                                                                    
accounting method of reflecting a  cash flow need and future                                                                    
Senator von Imhof thought it  sounded as though some surplus                                                                    
cash  was moving  from completed  projects into  the Capital                                                                    
Income Fund and  could be redeployed as  the legislature saw                                                                    
Mr. Steininger agreed with Senator von Imhof's assessment.                                                                      
9:10:08 AM                                                                                                                    
Senator  Hoffman looked  at the  $12.5  million in  negative                                                                    
funds shown on the slide and  asked if all the projects with                                                                    
remaining funds  were state projects  or were  projects from                                                                    
specific districts.                                                                                                             
Mr. Steininger  stated that  the funds  represented projects                                                                    
throughout   the  state,   including   some  from   specific                                                                    
districts. There  was a  handful of  transportation projects                                                                    
that would be  for specific road projects.  All the projects                                                                    
had been completed under budget.                                                                                                
Co-Chair  Stedman  informed  that  he  had  asked  staff  to                                                                    
consolidate  the supplemental  items spread  over the  three                                                                    
pieces  of legislation  as mentioned  by  Mr. Steininger  in                                                                    
order to have  a clear demarcation in current  and past year                                                                    
spending. He  discussed ways of formatting  the supplemental                                                                    
items for clarity.                                                                                                              
Co-Chair  Bishop  thought  it  could  be  debated  that  the                                                                    
funding  could be  shown as  revenue instead  of a  negative                                                                    
Mr. Steininger  thought there  was a  difference in  the way                                                                    
the  Legislative Finance  Division (LFD)  and the  Office of                                                                    
Management and  Budget (OMB) had historically  looked at the                                                                    
type of  transfer being  discussed. The  administration felt                                                                    
that showing the $12.7 million  as a reduction in the amount                                                                    
available for  capital (rather than  a positive  in revenue)                                                                    
better reflected the action being performed.                                                                                    
Mr. Steininger spoke  to slide 3, "Capital  Budget Five Year                                                                    
Overview  FY2018     FY2022,"   which  showed  a  bar  graph                                                                    
depicting  a  five-year  lookback  in  capital  budgets.  He                                                                    
pointed out  the column  on the far  right which  showed the                                                                    
difference between the capital budget  in FY 21 and what was                                                                    
proposed for  FY 22.  The FY 21  numbers were  reflective of                                                                    
the supplemental  appropriations discussed earlier.  He made                                                                    
note of a  dramatic decrease in UGF, which  he contended had                                                                    
to do with the utilization of  bonding to cover UGF needs in                                                                    
the  capital budget.  He  noted that  there  was an  overall                                                                    
slight  increase  of  about $30  million  in  total  capital                                                                    
appropriations  proposed, primarily  coming  from the  $52.9                                                                    
increase in federal revenues.                                                                                                   
Co-Chair  Bishop  asked if  there  were  Other fund  sources                                                                    
other than AHFC funds.                                                                                                          
Mr.  Steininger  stated  there were  plenty  of  other  fund                                                                    
sources   utilized  for   capital  projects.   He  mentioned                                                                    
community partners or other arrangements  as ways of finding                                                                    
other  groups to  assist in  meeting  federal matching  fund                                                                    
9:14:10 AM                                                                                                                    
Mr. Steininger  referenced slide 4, "Capital  Budget History                                                                    
FY2011    FY2022," which  showed a bar  graph giving  a more                                                                    
long-term view of  past capital budgets. He  pointed out the                                                                    
UGF  capital  spending had  been  stable  but low  over  the                                                                    
previous  several fiscal  years,  since  the higher  capital                                                                    
budgets  appropriated in  FY 12  and  FY 13,  and lower  but                                                                    
still high capital budgets in FY 14 and FY 15.                                                                                  
Senator  von  Imhof thought  Alaska  had  been fortunate  in                                                                    
having  consistent annual  federal  match  for highways  and                                                                    
airports. She  asked about  a five-year  bill passed  by the                                                                    
federal  government several  years previously.  She wondered                                                                    
about the  timing and if  the federal match  would continue.                                                                    
She  wondered if  there was  another  upcoming federal  bill                                                                    
that would result in Alaska getting more funds.                                                                                 
Mr.  Steininger acknowledged  he was  not an  expert in  the                                                                    
federal  appropriations process.  He agreed  that the  state                                                                    
had a  fairly generous  match on the  Surface Transportation                                                                    
Infrastructure  Program,  that  brought  in  a  lot  of  the                                                                    
federal receipts  shown on the  slide in light blue.  he did                                                                    
not  want  to  speculate  about what  might  happen  at  the                                                                    
federal  level.  He thought  there  might  be staff  at  the                                                                    
Department  of Transportation  and  Public Facilities  (DOT)                                                                    
that tracked such developments more closely.                                                                                    
Senator von Imhof thought the  committee should query DOT to                                                                    
hear what  to expect in the  future and where the  state was                                                                    
in the cycle of federal allocation.                                                                                             
9:16:19 AM                                                                                                                    
Co-Chair Stedman  thought the committee should  consider the                                                                    
significant   capital  coming   into  the   state  via   the                                                                    
Coronavirus Aid, Relief, and  Economic Security (CARES) Act,                                                                    
as well  as through  a federal highway  bill. He  recalled a                                                                    
$30  million  increase per  year.  He  thought it  might  be                                                                    
interesting for  the committee to  know how much  of project                                                                    
funding was built into specific  years. He thought DOT, OMB,                                                                    
or LFD  could put together  a document that showed  how much                                                                    
capital funding  was spent in  each year. He  discussed bond                                                                    
issuance and  expenditure of funds  over time.  He mentioned                                                                    
the need for economic stimulus  around the state and thought                                                                    
it would be interesting to see  how much DOT had expended in                                                                    
the previous two or three years.                                                                                                
Co-Chair Bishop  informed Mr. Steininger that  the committee                                                                    
would  request   a  list  of  projects   going  forward.  He                                                                    
mentioned  a potential  bond package.  He  wanted to  ensure                                                                    
that  the legislature  did not  "overheat"  the economy.  He                                                                    
emphasized that the goal was  to put Alaskans to work rather                                                                    
than hire many out-of-state  contractors. He reiterated that                                                                    
the  committee would  want to  see  a detailed  list of  the                                                                    
governor's proposed projects by district.                                                                                       
Co-Chair Bishop  noted that  when OMB  put out  the deferred                                                                    
maintenance   list  and   capital  project   list,  he   was                                                                    
interested in  seeing how much  funding would be put  on the                                                                    
street versus how  much of the work was proposed  to be done                                                                    
9:20:14 AM                                                                                                                    
Mr.  Steininger  spoke  to Co-Chair  Stedman's  comment  and                                                                    
noted  that the  previous  day OMB  had  posted its  capital                                                                    
appropriation status  report, which included  information on                                                                    
the  status of  historical projects  and informed  about the                                                                    
amount of funds  that had been appropriated  versus what was                                                                    
still  unobligated. He  encouraged  members to  look at  the                                                                    
document,  which  provided  details about  individual  prior                                                                    
Co-Chair  Stedman   thought  the  document   Mr.  Steininger                                                                    
mentioned  would be  a good  baseline for  the committee  to                                                                    
consider.  He appreciated  the information  and thought  the                                                                    
document  would  make   putting  the  requested  information                                                                    
together much easier.                                                                                                           
Mr.  Steininger turned  to slide  5, "FY2022  Capital Budget                                                                    
Snapshot," which  showed a data table  with proposed capital                                                                    
projects broken down by department.  He pointed out that the                                                                    
Department  of  Environmental  Conservation  (DEC)  had  $24                                                                    
million  in the  "FY 22  Other" column,  which was  one area                                                                    
where the  administration had utilized AHFC's  bonding. In a                                                                    
normal year, the  bulk of the funds would appear  in the UGF                                                                    
column  and  were  for the  Village  Safewater  Project.  He                                                                    
pointed  out the  $19.8 million  in  UGF and  $144.7 in  the                                                                    
Other  column for  DOT.  He added  that  the $144.7  million                                                                    
signified the  other location AHFC  bonds were  utilized, in                                                                    
this    case   to    cover   the    Surface   Transportation                                                                    
Infrastructure Program.                                                                                                         
Senator von  Imhof asked about  the $49 million  shown under                                                                    
the Office of the Governor on slide 5.                                                                                          
Mr. Steininger explained that the  $49 million in the Office                                                                    
of  the Governor  was  for deferred  maintenance  in FY  22.                                                                    
Several    years   previously    the   administration    had                                                                    
transitioned  to  a  shared  pool  of  deferred  maintenance                                                                    
allocated through  a process  with the  Statewide Facilities                                                                    
Council and the Division of Facilities Services.                                                                                
Senator von  Imhof wondered  if there was  a rubric  used to                                                                    
vet projects.                                                                                                                   
Mr.  Steininger  stated  that   there  were  many  different                                                                    
factors used in  the decision process. He  recounted that in                                                                    
the past every  agency had its own way  of ranking projects,                                                                    
and   the  administration   was  working   towards  a   more                                                                    
standardized method.  He noted  that one capital  request in                                                                    
the bill was for a  maintenance management system, which was                                                                    
an  ongoing  project that  tried  to  combine the  disparate                                                                    
tracking  methods into  one location.  He  commented on  the                                                                    
large  volume  of projects  that  needed  tracking, and  the                                                                    
time-intensive process to prioritize across all agencies.                                                                       
9:24:23 AM                                                                                                                    
Senator  Wilson  referenced  AHFC bonding  for  the  Village                                                                    
Safewater Program for DEC. He  asked if Mr. Steininger had a                                                                    
list of other bonding projects.                                                                                                 
Mr.  Steininger  explained  that there  were  two  different                                                                    
bonding  proposals  that  had   been  put  forward.  In  the                                                                    
traditional capital  budget, there was bonding  through AHFC                                                                    
in the amount  about $100 million. The  $350 million general                                                                    
obligation (GO) bond package was  not yet released and there                                                                    
was not  a project  list ready to  be publicly  released. He                                                                    
affirmed that when the list  was released it would be shared                                                                    
with the  committee along with  information on  the projects                                                                    
and how the list was determined.                                                                                                
Senator  Wilson  asked  when  Mr.  Steininger  expected  the                                                                    
information to be available.                                                                                                    
Mr. Steininger  did not have  an estimated date  but thought                                                                    
the list  would be ready  as soon as the  administration was                                                                    
Mr.  Steininger  considered  slide 6,  "FY2022  Projects  by                                                                    
     Commerce, Community & Economic Development                                                                                 
     1.  Community Block  Grants $6,060.0  ($60.0 GF  Match,                                                                    
     $6,000.0 Fed)                                                                                                              
     2.  National Petroleum  Reserve $9,100.0  Fed -  Alaska                                                                    
     Impact Grant Program National Petroleum Reserve Fund                                                                       
     3. AMCO Enforcement  Case Management and Investigations                                                                    
     Report Writing System $200.0 ($100.0  UGF, $100.0 DGF -                                                                    
     Program Receipts)                                                                                                          
     4.  Alaska Energy  Authority -  Alaska  Cargo and  Cold                                                                    
     Storage $21,000.0 Fed                                                                                                      
     5.  Alaska Energy  Authority -  Alternative Energy  and                                                                    
     Energy Efficiency Programs $5,000.0 Fed                                                                                    
     6.  Alaska  Energy  Authority   -  Bulk  Fuel  Upgrades                                                                    
     $13,000.0 ($5,000.0 DGF - PCE Endowment, $7,500.0 Fed)                                                                     
     7.  Alaska  Energy  Authority  -  Rural  Power  Systems                                                                    
     Upgrades  $17,500.0  ($5,000.0  DGF  -  PCE  Endowment,                                                                    
     $12,500.0 Fed)                                                                                                             
     8. Alaska  Travel Industry  Association $5,000.0  DGF                                                                      
     Vehicle Rental Tax                                                                                                         
     9. Inter-Island Ferry Authority $250.0 UGF                                                                                 
Mr.  Steininger  referenced  an additional  document  titled                                                                    
"Capital Project Summary," (copy  on file); which would have                                                                    
further details  that corresponded with the  item numbers of                                                                    
the projects  listed on the  slide. He pointed  out standard                                                                    
recurring projects and a new project.                                                                                           
Senator Hoffman  relayed that he  had been excited  when the                                                                    
governor  had asserted  that  he was  making  Alaska a  more                                                                    
affordable  place  to live.  He  had  expected to  see  more                                                                    
capital projects focused on the  issue. He observed that the                                                                    
vast  majority of  the Alaska  Energy Authority  funds going                                                                    
towards  the  Alaska  Cargo  and   Cold  Storage,  which  he                                                                    
supported.  He  asked if  there  was  another place  in  the                                                                    
budget  or  part of  the  bond  package that  signified  the                                                                    
governor's support for making  the state more affordable. He                                                                    
discussed high energy  costs, which he thought  were a large                                                                    
part of Alaskan's expenditure of disposable income.                                                                             
9:29:13 AM                                                                                                                    
Mr. Steininger thought  there was a couple  of projects that                                                                    
could  address the  matter, but  the  projects were  ongoing                                                                    
rather  than additional  investment. He  could not  speak to                                                                    
what would be  included in the bonding  package. He asserted                                                                    
that the  administration was  open to  looking at  ways that                                                                    
could  reduce energy  costs in  the state.  In addition,  he                                                                    
thought part of the matter  was looking at state regulations                                                                    
and  other  changes that  could  assist  in lowering  energy                                                                    
costs outside capital appropriations.                                                                                           
Senator  Hoffman  thought  one  of the  most  effective  and                                                                    
successful projects  reducing energy costs in  the state was                                                                    
the weatherization  program, which had resulted  in lowering                                                                    
heating costs  by 40  to 60 percent.  He commented  that the                                                                    
state had spent hundreds of  millions but had saved millions                                                                    
of dollars for  Alaskans. He expected something  of the same                                                                    
magnitude given the comments made by the governor.                                                                              
Co-Chair  Stedman  remarked that  he  had  worked on  energy                                                                    
projects with Senator Hoffman.  He wanted the administration                                                                    
to  consider debt  relief, which  he  thought would  provide                                                                    
immediate  economic  response.  He  did  not  think  a  bond                                                                    
package was immediate enough. He  thought if the legislature                                                                    
could come  up with  mechanisms to immediately  lower energy                                                                    
costs  in homes  it would  be beneficial  for the  state. He                                                                    
discussed   targeted  debt   reduction   on  utilities.   He                                                                    
recognized there  were numerous utilities of  various sizes,                                                                    
and thought it was important  to help citizens sooner rather                                                                    
than later.                                                                                                                     
9:33:01 AM                                                                                                                    
Senator   von  Imhof   thought  the   legislature  and   the                                                                    
administration faced the challenge  of balancing the present                                                                    
and the future that Co-Chair  Stedman alluded to. She agreed                                                                    
that citizens of Alaska needed  to see immediate relief. She                                                                    
thought  CARES Act  funding  should  provide some  immediate                                                                    
relief in various  areas. She did not want  to ignore future                                                                    
needs of  rural energy  and Railbelt energies  that included                                                                    
new technologies. She recalled  Senator Hoffman had provided                                                                    
information on  a hydro project  in Dillingham.  She thought                                                                    
such  projects   needed  planning  and  strategy   but  were                                                                    
meaningful to the state when completed.                                                                                         
Co-Chair  Bishop thought  the  state should  take a  serious                                                                    
look  at getting  the Susitna  project to  a Federal  Energy                                                                    
Regulatory  Commission (FERC)  application and  building out                                                                    
the  intertie.  He  mentioned hydro  projects  in  Southeast                                                                    
Alaska and in Kodiak and  thought the projects would free up                                                                    
funds for alternative energy projects in rural areas.                                                                           
Co-Chair  Bishop mentioned  item 7  on slide  6, which  used                                                                    
Power  Cost Equalization  (PCE)  Endowment  funds for  rural                                                                    
power systems  upgrades. He asked  if the  proposed spending                                                                    
overdrew the PCE fund by leveraging the dollars.                                                                                
Mr. Steininger did not believe  that the $5 million from PCE                                                                    
for the rural power system upgrade overdrew the fund.                                                                           
Co-Chair Stedman asked if the PCE Fund was in overdraw.                                                                         
Mr. Steininger did not believe the fund was overdrawn.                                                                          
Co-Chair Bishop asked for confirmation.                                                                                         
Mr. Steininger agreed to provide a definitive answer.                                                                           
Co-Chair Stedman was  under the impression the  PCE Fund was                                                                    
under  strain and  wanted more  information. He  thought the                                                                    
PCE  Fund had  been mentioned  in the  context of  sweepable                                                                    
funds. He  thought there was a  lot of pressure on  the fund                                                                    
already. He wondered if Mr.  Steininger had a comment on the                                                                    
Mr.  Steininger  recalled  that   the  PCE  Fund  had  lower                                                                    
earnings in the prior years,  which had impacted the deposit                                                                    
into the  Community Assistance Fund.  He agreed to  get back                                                                    
to  the committee  with a  more detailed  accounting of  the                                                                    
appropriations from  the PCE  Fund and  the earnings  of the                                                                    
9:37:49 AM                                                                                                                    
Senator  Hoffman was  very familiar  with the  PCE Fund.  He                                                                    
thought the  first call  of the fund  was for  assistance to                                                                    
lower  energy  costs,  the second  call  was  for  community                                                                    
assistance,  and the  third call  was for  projects such  as                                                                    
listed under item 7 on slide  6. He asked for Mr. Steininger                                                                    
to provide  a spreadsheet  detailing how the  earnings would                                                                    
be spent under the three  categories in order to ensure that                                                                    
the fund was not being overdrawn.                                                                                               
Co-Chair   Bishop  commented   that  the   $5  million   for                                                                    
Department of  Commerce, Community and  Economic Development                                                                    
(DCCED)  for  the  travel  industry would  be  an  item  the                                                                    
committee would watch due to an unknown tourist season.                                                                         
Senator von Imhof asked for more details.                                                                                       
Co-Chair  Bishop  elaborated that  the  size  of the  cruise                                                                    
season was unknown. He wondered  about the receipt authority                                                                    
and  the  vehicle   rental  tax.  He  wanted   to  know  the                                                                    
administration's  opinion as  to  whether  the amount  would                                                                    
reach the $5 million threshold.                                                                                                 
Senator von  Imhof thought  that while  the state  might not                                                                    
have a cruise industry as robust  as in the past, there were                                                                    
individuals  coming to  the state  via  travel. She  thought                                                                    
Alaska  was a  prime destination,  and Europe  was currently                                                                    
more  difficult  to  reach.   She  commented  on  the  space                                                                    
available in  the state for  social distancing.  She thought                                                                    
it would  be in the  state's interest to  continue promoting                                                                    
for travel just because of reduced cruise ship traffic.                                                                         
Co-Chair  Bishop  clarified that  he  was  not proposing  to                                                                    
eliminate the  funding. He wanted to  ensure the appropriate                                                                    
fund  source  was  used  so there  was  not  a  supplemental                                                                    
request in the out years.                                                                                                       
Co-Chair Stedman  agreed that the committee  should continue                                                                    
to examine the fund source  for the appropriation. He agreed                                                                    
with  Senator  von Imhof  that  it  was important  to  bring                                                                    
tourism back to the state as soon as possible.                                                                                  
9:41:07 AM                                                                                                                    
Mr.  Steininger  displayed  slide  7,  "FY2022  Projects  by                                                                    
     1. Seven New Facility Body Scanners $1,500.0 UGF                                                                           
     2.   Point   Mackenzie    Correctional   Farm   Produce                                                                    
     Processing Plant $1,500.0 UGF                                                                                              
     Environmental Conservation                                                                                                 
     1. Clean Water Capitalization Grant Subsidy $2,000.0                                                                       
     Other (Clean Water Loan Fund)                                                                                              
     2. Drinking Water Capitalization Grant Subsidy                                                                             
     $5,800.0 Other (Drinking Water Fund)                                                                                       
     3.  Village Safe  Water  and Wastewater  Infrastructure                                                                    
     Projects:  Expansion,   Upgrade,  and   Replacement  of                                                                    
     Existing  Service  $30,538.0  ($9,438.0  Other     AHFC                                                                    
     Bonds, $200.0 Other  SDPR, $20,900.0 Fed)                                                                                  
     4.  Village Safe  Water  and Wastewater  Infrastructure                                                                    
     Projects:   First  Time   Service  Projects   $37,942.0                                                                    
     ($6,292.0  Other    AHFC Bonds,  $300.0  Other    SDPR,                                                                    
     $31,350.0 Fed)                                                                                                             
Senator  Wilson  asked for  a  list  of  the usage  for  the                                                                    
current  body  scanners.  He understood  that  some  of  the                                                                    
scanners were not being utilized.                                                                                               
Mr. Steininger agreed to provide  more information. He noted                                                                    
there were  old full-body  scanners that were  not effective                                                                    
in  detecting all  the types  of contraband  that came  into                                                                    
facilities.  The  new body  scanners  had  shown success  in                                                                    
finding materials that previous scanners had not.                                                                               
Co-Chair Stedman referenced slide  6. He thought the Vehicle                                                                    
Rental Tax was  an operating budget item,  and the committee                                                                    
would work to make sure  the appropriation was in the budget                                                                    
and keep an eye on the  fund source. He mentioned item 9 and                                                                    
the $250,000  for the  Inter-Island Ferry  Authority (IIFA).                                                                    
He  acknowledged  that  the  Alaska  Marine  Highway  System                                                                    
(AMHS) had  some difficulties. He  noted that the  IIFA went                                                                    
from Ketchikan to  Metlakatla. He asserted that  if the IIFA                                                                    
was not  helped enough and  was unable to  provide services,                                                                    
it  would  cost much  more  for  the  AMHS  to back  up  the                                                                    
service. He thought  the $250 thousand proposed  was a small                                                                    
price and  was not  sufficient. He  was concerned  about the                                                                    
IIFA's backup of deferred maintenance.                                                                                          
Co-Chair Bishop  asked Mr. Steininger  to provide a  list of                                                                    
DEC wastewater and drinking water projects.                                                                                     
9:44:52 AM                                                                                                                    
Mr.  Steininger highlighted  slide  8,  "FY2022 Projects  by                                                                    
     Fish and Game                                                                                                              
          1.   Pacific   Salmon   Treaty   Chinook   Fishery                                                                    
          Mitigation $7,700.0 Fed                                                                                               
          2. 2018 Sockeye Salmon Disaster - Chignik Area                                                                        
          $2,000.0 Fed                                                                                                          
          3.  Endangered Species  Act -  Legal and  Research                                                                    
          Needs to  Protect State  Right to  Manage $4,000.0                                                                    
          ($250.0 GF Match, $750.0 UGF, $3,000.0 Fed)                                                                           
          4.  Pacific Cod  Disaster Funding  - 2018  Gulf of                                                                    
          Alaska $1,000.0 Fed                                                                                                   
          5.   Copper    River   Boat    Launch   Facilities                                                                    
          Improvements $165.0 Other  Fish & Game Fund                                                                           
          6. Facilities,  Vessels and  Aircraft Maintenance,                                                                    
          Repair and  Upgrades $500.0  DGF    Capital Income                                                                    
          7. Pacific  Coastal Salmon Recovery  Fund $4,400.0                                                                    
          8.  Sport  Fish  Recreational Boating  and  Angler                                                                    
          Access $3,000.0 ($750.0 Other - Fish & Game Fund,                                                                     
          $2,250.0 Fed)                                                                                                         
          9.  Wildlife  Management,   Research  and  Hunting                                                                    
          Access  $15,000.0 ($1,250.0  Other -  Fish &  Game                                                                    
          Fund, $2,500.0 Other - SDPR, $11,250.0 Fed)                                                                           
Mr. Steininger  detailed that the  appropriation for  item 1                                                                    
was related to an  Revised Program Legislative (RPL) Process                                                                    
Overview  put  forth  over  the  previous  summer.  The  RPL                                                                    
provided access to  the federal grant in  the current fiscal                                                                    
year  but the  project  spanned fiscal  years. The  projects                                                                    
were capital in  nature and would allow  for expending funds                                                                    
over  the life  of  the projects.  He highlighted  disaster-                                                                    
related funding.  He noted  that item 3  was to  ensure that                                                                    
the state had involvement with  what species were put on the                                                                    
endangered species list, and to  ensure proposer science was                                                                    
being done in consideration of  animals on the list. Items 8                                                                    
and 9 were traditional projects.                                                                                                
Senator  Wielechowski asked  about  item 3  on  slide 8.  He                                                                    
asked  if the  federal government  was giving  the state  $3                                                                    
million to potentially sue the federal government.                                                                              
Mr.  Steininger  informed that  the  $3  million would  help                                                                    
support  the science  and research  needed  to identify  any                                                                    
species for  potential inclusion  on the  Endangered Species                                                                    
Act list. There  were state funds being expended  as well as                                                                    
federal funds to support the science and research.                                                                              
Co-Chair Stedman  asked about item  7 and the  Pacific Coast                                                                    
Salmon  Recovery  Fund.  He  wanted  to  ensure  there  were                                                                    
matching  funds. He  requested  that  OMB highlight  Dingell                                                                    
Johnson  and  Pittman-Robertson  federal  fund  sources.  He                                                                    
wondered if  the state had  to return  funds due to  lack of                                                                    
matching funds  and asked  if the state  was subject  to any                                                                    
return of funds for lack of matching funds or projects.                                                                         
Mr. Steininger stated that the  projects through the program                                                                    
in item 7 were generally  provided matching funds by project                                                                    
partners in communities. He noted  that the amount available                                                                    
in  the Pittman-Robertson  funds and  Dingell Johnson  funds                                                                    
had  been increasing,  which was  a  concern the  department                                                                    
tracked.  he  offered  to provide  information  on  how  the                                                                    
administration was avoiding sending any funds back.                                                                             
9:49:01 AM                                                                                                                    
Senator  Hoffman asked  for a  list  of projects  associated                                                                    
with the $3  million for item 8. He wanted  to know what the                                                                    
projects hoped to accomplish for  boating and angler access.                                                                    
He  asked  about  the split  between  research  and  hunting                                                                    
access for  the $50 million on  item 9. He asked  for a list                                                                    
of projects listed as part of item 9.                                                                                           
Mr. Steininger did  not know the split  between research and                                                                    
access projects  within item 9.  He affirmed he would  get a                                                                    
list of projects and the criteria for the projects.                                                                             
Senator Hoffman asked  for a complete list  of projects that                                                                    
were not being funded as well.                                                                                                  
Senator Wielechowski  asked about  sport fish  license fees,                                                                    
which he thought had been cut  by $9. He asked if there were                                                                    
any impacts to the federal match because of the change.                                                                         
Mr.  Steininger knew  that the  license fee  collections and                                                                    
the  health of  the Fish  and Game  Fund had  been addressed                                                                    
with the Department of Fish and  Game (DFG) to ensure it was                                                                    
capable of  meeting its obligations. The  administration did                                                                    
not  have immediate  concerns about  the  ability to  retain                                                                    
matching funds but thought it  was an issue to be monitored.                                                                    
He  noted  that  the  COVID-19 pandemic  had  impacted  some                                                                    
revenues in  DFG, and was  something to be tracked,  but the                                                                    
administration  did not  have concerns  over the  ability to                                                                    
match the federal funds listed in the projects.                                                                                 
Co-Chair Bishop  thought all the members  were interested in                                                                    
item 1  on slide  8. He  asked for  more background.  He was                                                                    
curious how  the fishery mitigation  money was  being spent.                                                                    
He  thought  people  had  suffered  from  poor  king  salmon                                                                    
Mr.  Steininger stated  that the  department  had begun  the                                                                    
work  and could  update  the committee  on  the progress  to                                                                    
Mr.  Steininger  looked  at slide  9,  "FY2022  Projects  by                                                                    
     1.  Statewide  Deferred  Maintenance,  Renovation,  and                                                                    
     Repair $49,250.0 DGF (Capital Income Fund)                                                                                 
     Health and Social Services                                                                                                 
     1. Ketchikan  Pioneer Home HVAC Intake  Damper Assembly                                                                    
     $76.5 UGF                                                                                                                  
     2.  Palmer  Alaska  Veterans and  Pioneer  Home  Safety                                                                    
     Fencing $61.2 UGF                                                                                                          
     3.  Health Information  Exchange $4,080.9  ($480.1 UGF,                                                                    
     $3,600.8 Fed)                                                                                                              
     4. Juneau  Pioneer Home ADA-Compliant  Courtyard $424.0                                                                    
     5.  Emergency  Medical  Services Match  for  Code  Blue                                                                    
     Project $500.0 GF Match                                                                                                    
     6.  MH:  Assistive Technology  $500.0  DGF  - MH  Trust                                                                    
     7.  MH:  Home  Modification   and  Upgrades  to  Retain                                                                    
     Housing  $1,150.0  ($900.0  DGF     MH  Trust  Reserve,                                                                    
     $250.0 Other  MH Trust Authority)                                                                                          
     8.   MH:   Deferred   Maintenance   and   Accessibility                                                                    
     Improvements  $500.0 ($250.0  DGF    MH Trust  Reserve,                                                                    
     $250.0 Other  MH Trust Authority)                                                                                          
Mr.  Steininger  noted  that   slide  9  covered  all  state                                                                    
facilities  that  were  generally   not  within  the  Public                                                                    
Building Fund,  which would be  addressed in a  later slide.                                                                    
He  explicated that  the administration  had generally  gone                                                                    
from  directly  funding   within  departments  to  comparing                                                                    
facilities  across departments  to  ensure  the most  urgent                                                                    
needs were met.                                                                                                                 
9:54:28 AM                                                                                                                    
Senator von  Imhof noted  that one of  the members  was also                                                                    
the chair  of the Senate  Health and Social  Services (HESS)                                                                    
Committee. She referenced item 3  and the Health Information                                                                    
Exchange.  She  was curious  if  the  Senate HESS  Committee                                                                    
would be interested  in looking at the  effectiveness of the                                                                    
exchange.  She discussed  the $480,000  to leverage  federal                                                                    
Co-Chair  Bishop stated  he would  work on  the matter  with                                                                    
Senator von Imhof after the meeting.                                                                                            
Co-Chair Stedman asked about item  1 under the Department of                                                                    
Health and  Social Services.  He disclosed  that he  had two                                                                    
family members in  the Sitka Pioneer Home.  He was concerned                                                                    
about the  status of deferred  maintenance in  Pioneer Homes                                                                    
in Alaska  and asked for  more information to be  brought to                                                                    
the  committee.  He mentioned  a  project  at the  Ketchikan                                                                    
Pioneer Home that involved the  HVAC intake damper assembly.                                                                    
The  description  mentioned  inadequate airflow  and  rusted                                                                    
parts. He  was curious  if the state  was getting  behind on                                                                    
Alaska  Pioneer  Homes. He  asked  for  a status  report  on                                                                    
deferred maintenance on all of the facilities.                                                                                  
Co-Chair  Bishop  thought  there  was  a  theme  of  members                                                                    
wanting to see lists of agency action items.                                                                                    
Senator Wilson referenced item 1  and asked if the state had                                                                    
looked at leveraging some additional COVID-19 funding.                                                                          
Mr. Steininger explained that the  requirements of CARES Act                                                                    
funds required that expenditures had  to be tied directly to                                                                    
an impact of COVID-19. He  thought it would be difficult for                                                                    
some of the projects to  establish a direct link and satisfy                                                                    
the federal requirement.  He thought in the case  of an HVAC                                                                    
system,  there could  be  a connection  to  air quality.  He                                                                    
thought the  project description  clearly showed  that there                                                                    
was a  long-time need that  did not arise because  of COVID-                                                                    
9:58:26 AM                                                                                                                    
Senator Wilson  wanted to clarify  whether DEC  had reviewed                                                                    
the items to  ensure that COVID-19 was  not exacerbating any                                                                    
of the  issues. He wondered  if the department  had examined                                                                    
the  deferred  maintenance  and   considered  if  the  items                                                                    
qualified for the COVID-19 funding.                                                                                             
Mr. Steininger affirmed that the  department had spent a lot                                                                    
of time  to ensure that  Pioneer Homes residents  were cared                                                                    
for  during the  pandemic. He  noted the  difficulty of  the                                                                    
situation  due to  the congregate  setting. He  assured that                                                                    
the department  had considered at  those areas  where things                                                                    
like  air filtration  could  be approved  or  worked on.  He                                                                    
thought   the  department   could   elaborate  on   COVID-19                                                                    
mitigation efforts in the Pioneer Homes.                                                                                        
Co-Chair  Bishop had  heard Mr.  Steininger note  that there                                                                    
were  three  items  that  were   recommended  by  AMHTA.  He                                                                    
referenced a letter  from the trust authority.  He wanted to                                                                    
distribute the letter for consideration.                                                                                        
10:00:11 AM                                                                                                                   
AT EASE                                                                                                                         
10:03:00 AM                                                                                                                   
Co-Chair  Bishop passed  out a  letter from  Chief Executive                                                                    
Officer Mike Abbott of AMHTA  (copy on file). The letter was                                                                    
addressed to  the committee co-chairs and  expressed concern                                                                    
with  the proposed  direct appropriations  of more  than $16                                                                    
million in  AMHTA budget  reserves in  the governor's  FY 22                                                                    
budgets and FY 21 supplemental budget proposals.                                                                                
Co-Chair Bishop  was glad  to see  that Neil  Steininger had                                                                    
stated the items on slide 9 were recommended by AMHTA.                                                                          
Mr.  Steininger  addressed  slide 10,  "FY2022  Projects  by                                                                    
     Military and Veterans Affairs                                                                                              
     1. State Homeland Security Grant Programs $7,500.0 Fed                                                                     
     2. Mass Notification System - Joint Base Elmendorf                                                                         
     Richardson   (JBER)   $5,000.0  ($2,500.0   GF   Match,                                                                    
     $2,500.0 Fed)                                                                                                              
     3. Joint Base Elmendorf Richardson (JBER) Digital                                                                          
     Control, Generator, and Preventative Maintenance                                                                           
     $7,850.0 ($3,812.5 UGF, $4,037.5 Fed)                                                                                      
     4. Kotzebue Tarmac Repair and Maintenance $5,200.0                                                                         
     ($4,812.5 UGF, $387.5 Fed)                                                                                                 
Co-Chair Stedman  asked about  item 4  and wondered  why the                                                                    
funds were  not mostly federal  funds rather than  the small                                                                    
matching funds shown.                                                                                                           
Mr. Steininger  clarified that Co-Chair Stedman  had asked a                                                                    
good question. He referenced  whether the additional federal                                                                    
money coming from the  Federal Aviation Administration (FAA)                                                                    
could be  utilized. He  agreed to look  into the  matter. He                                                                    
noted that when  the project proposal was  put together, the                                                                    
FAA  funds had  already been  obligated through  an RPL.  He                                                                    
discussed  state  versus   federal  responsibility  for  the                                                                    
Co-Chair  Bishop  asked if  Senator  Olson  had any  comment                                                                    
about item 4, which concerned an item in his district.                                                                          
Senator Olson noted that Kotzebue  only had one main runway,                                                                    
which was necessary  to get in and out. He  proposed that in                                                                    
light  of the  fact that  there  were a  number of  COVID-19                                                                    
infections in  the area, it  was very important  to maintain                                                                    
the  runway. Additionally,  there were  transportation needs                                                                    
from the  Red Dog Mine.  He felt very strongly  about making                                                                    
sure the tarmac was repaired.                                                                                                   
10:07:38 AM                                                                                                                   
Mr.  Steininger advanced  to slide  11, "FY2022  Projects by                                                                    
     Natural Resources                                                                                                          
     1. Agriculture Specialty Crop Block Grant $4,500.0 Fed                                                                     
     2.  Critical  Minerals  Mapping  -  Earth  MRI  (3DEEP)                                                                    
     $2,200.0  ($500.0  GF  Match,   $200.0  Other     SDPR,                                                                    
     $1,500.0 Fed)                                                                                                              
     3.  Abandoned Mine  Lands  Reclamation Federal  Program                                                                    
     $3,200.0 Fed                                                                                                               
     4.  Geological  Mapping  for Energy  Development  (USGS                                                                    
     STATEMAP) $900.0 ($300.0 GF Match, $600.0 Fed)                                                                             
     5. Cooperative  Water Resource Program  Pass-through to                                                                    
    USGS for Stream Gaging Projects $300.0 Other  SDPR                                                                          
     6. Federal and Local  Government Funded Forest Resource                                                                    
     and Fire Program $7,000.0 Fed                                                                                              
     7. Land Sales -  New Subdivision Development $500.0 DGF                                                                    
     - State Land Disposal Income                                                                                               
     8.  Land  and  Water Conservation  Fund  Federal  Grant                                                                    
    Program $5,652.7 ($2,152.7 GF Match, $3,500.0 Fed)                                                                          
     9. National  Historic Preservation Fund  $800.0 ($200.0                                                                    
     Other - SDPR, $600.0 Fed)                                                                                                  
Co-Chair  Bishop  noticed  that the  $250,000  for  SnowTRAC                                                                    
grants was  not included.  He wondered if  there had  been a                                                                    
Mr.  Steininger  affirmed  that  the item  was  not  in  the                                                                    
proposed budget.                                                                                                                
10:10:13 AM                                                                                                                   
Mr.  Steininger  looked at  slide  12,  "FY2022 Projects  by                                                                    
     Natural Resources - continued                                                                                              
     10. National Recreational Trails Federal Grant Program                                                                     
     $1,600.0 ($100.0 DGF   Program Receipts, $1,500.0 Fed)                                                                     
     11.  State Park  Electronic Fee  Stations $220.0  DGF                                                                      
     Program Receipts                                                                                                           
     Public Safety                                                                                                              
     1. Marine Fisheries Patrol Improvements $1,100.0 Fed                                                                       
     2. Fire & Life Safety Vehicles $150.0 UGF                                                                                  
     3. Crime Laboratory Equipment Replacement $300.0 UGF                                                                       
     4. Replace Training Video Simulator $240.0 UGF                                                                             
     5. AWT Law Enforcement Equipment and Off-Highway                                                                           
     Vehicle Replacement $750.0 UGF                                                                                             
     6. AST Law Enforcement Equipment Replacement $500.0                                                                        
     7. Vehicle Replacement $1,233.6 UGF                                                                                        
Co-Chair Bishop asked about item  7 and wondered if the $1.2                                                                    
million  was to  make  the Alaska  State Troopers'  vehicles                                                                    
"street  legal." He  asked if  the troopers  had a  mechanic                                                                    
shop to  outfit the vehicles  with safety accessories  or if                                                                    
there  would be  a reimbursable  services agreement  back to                                                                    
State Equipment Fleet (SEF).                                                                                                    
Mr.  Steininger   affirmed  that   the  SEF   purchased  the                                                                    
vehicles. He  thought some of  the equipment was able  to be                                                                    
installed when  the vehicles were purchased,  and some could                                                                    
not.  He  thought  the Department  of  Public  Safety  could                                                                    
address the matter in more  detail. He mentioned paying down                                                                    
depreciation credits  over time, which ensured  that much of                                                                    
the cost of replacement vehicles  came from credits built up                                                                    
within the Highway Equipment Working  Capital Fund. He noted                                                                    
that the UGF in item 7  was to ensure that the vehicles were                                                                    
street legal.                                                                                                                   
Co-Chair Bishop  asked if the  work was being  done in-house                                                                    
or through a reimbursable services agreement.                                                                                   
Mr. Steininger agreed to get  back to the committee with the                                                                    
10:14:12 AM                                                                                                                   
Co-Chair  Stedman  asked  about   item  3  and  thought  the                                                                    
committee could use an update  on the crime lab after having                                                                    
received an  update a few  years previously. He  mentioned a                                                                    
significant  capital investment  for the  lab and  wanted to                                                                    
receive some data  on utilization on the square  feet of the                                                                    
building. He thought the committee  needed an update about a                                                                    
backlog  of  rape  kits  in  the  crime  lab.  He  mentioned                                                                    
significant concerns and wanted to revisit the issue.                                                                           
Senator Wielechowski  thought there  was other  DNA analysis                                                                    
from felony cases  that was in backlog at the  crime lab. He                                                                    
agreed with Co-Chair Stedman in  that the issue needed to be                                                                    
revisited.  He  recalled  that  the  state  had  spent  $100                                                                    
million on the lab in order to get testing done.                                                                                
Mr.  Steininger   showed  slide  13,  "FY2022   Projects  by                                                                    
     1. AHFC Rental Assistance  for Persons Displaced Due to                                                                    
     Domestic Violence  - Empowering Choice  Housing Program                                                                    
     (ECHP) $1,500.0 UGF  AHFC Dividend                                                                                         
     2.   AHFC    Teacher,   Health   and    Public   Safety                                                                    
     Professionals  Housing $2,250.0  ($1,750.0  UGF    AHFC                                                                    
     Div, $500.0 Other  SDPR)                                                                                                   
     3. AHFC  Energy Efficiency  Research $500.0 UGF    AHFC                                                                    
     4.  AHFC Senior  Citizens  Housing Development  Program                                                                    
     $1,750.0 UGF  AHFC Div                                                                                                     
     5.  AHFC Housing  and  Urban  Development Federal  HOME                                                                    
     Grant $4,750.0 ($750.0 UGF  AHFC Div, $4,000.0 Fed)                                                                        
     6.  AHFC Housing  and  Urban  Development Capital  Fund                                                                    
     Program $3,200.0 Fed                                                                                                       
     7. AHFC  Federal and Other Competitive  Grants $7,500.0                                                                    
     ($1,500.0 UGF  AHFC Div, $6,000.0 Fed)                                                                                     
     8. AHFC Competitive Grants  for Public Housing $1,100.0                                                                    
     ($350.0 UGF  AHFC Div, $750.0 Fed)                                                                                         
     9.  AHFC   Supplemental  Housing   Development  Program                                                                    
     $1,500.0 UGF - AHFC Div                                                                                                    
Mr.  Steininger noted  that all  the projects  on the  slide                                                                    
were associated  with AHFC.  He furthered  that most  of the                                                                    
items were  recurring annually and utilized  AHFC dividends.                                                                    
He  noted that  the dividends  were  paid to  the state  and                                                                    
generally used for capital projects.                                                                                            
Co-Chair Bishop  noted that the  executive director  of AHFC                                                                    
was available for questions.                                                                                                    
Senator von  Imhof wanted  to ensure  that the  budget would                                                                    
not overspend  the annual  AHFC dividend  with all  the line                                                                    
items  listed  on  the  slide. She  referenced  item  2  and                                                                    
recalled  that the  CARES Act  had  provided something  like                                                                    
$150 million  for housing. She  wondered how  the additional                                                                    
funds might affect the projects and help with housing.                                                                          
10:18:20 AM                                                                                                                   
BRYAN  BUTCHER,   CHIEF  EXECUTIVE  OFFICER   AND  EXECUTIVE                                                                    
DIRECTOR, ALASKA HOUSING  FINANCE CORPORATION, DEPARTMENT OF                                                                    
REVENUE (via  teleconference), noted  that the  dividend for                                                                    
the current  year was  a little over  $42.5 million  and was                                                                    
not overspent in the proposed  budget. He recounted that the                                                                    
state had  received $200 million  in federal funds  for rent                                                                    
relief,  specifically   to  help   renters  with   rent  and                                                                    
utilities. He  continued that $36  million was going  to the                                                                    
Municipality of Anchorage, with  the remainder gong to AHFC.                                                                    
The  authority had  worked with  the municipality,  regional                                                                    
housing   authorities,  and   tribal  entities,   which  had                                                                    
received approximately $95  million. The collaboration would                                                                    
provide  a  central  funding portal  and  would  help  avoid                                                                    
duplication.  He asserted  that the  primary benefit  of the                                                                    
funds was  to prevent  people becoming homeless.  He relayed                                                                    
that most Alaskans that had lots  of jobs or income have had                                                                    
multiple months of difficulty in  paying rent, and the funds                                                                    
would probably be able to assist any qualifying applicant.                                                                      
Senator von  Imhof knew that  housing was very tight  in the                                                                    
state. She thought it was  difficult for people to remain in                                                                    
place. She asked  if the CARES Act  had provided flexibility                                                                    
for creating capacity in housing.                                                                                               
Mr.  Butcher explained  that the  CARES Act  funds for  2021                                                                    
were  strictly defined  as to  recipients and  how it  could                                                                    
help. The CARES Act funds  from 2020 had been more flexible.                                                                    
He  noted  that  President  Biden had  discussed  having  an                                                                    
additional $25 billion in housing  assistance in an upcoming                                                                    
stimulus  bill.   He  would  continue   to  work   with  the                                                                    
congressional  delegation to  ensure  the  funding could  be                                                                    
broadly  applied  to provide  help  to  Alaskan renters  and                                                                    
10:21:24 AM                                                                                                                   
Senator Hoffman  asked about  item 3  and the  proposed $500                                                                    
thousand for  energy efficiency  research. He  mentioned the                                                                    
Alaska Center for Energy and  Power (ACEP) at the University                                                                    
of  Alaska Fairbanks  and  a focus  on  energy research.  He                                                                    
wondered  if the  funds were  being coordinated  with energy                                                                    
research at UA and if not, why.                                                                                                 
Mr.  Butcher  stated that  the  funds  were focused  on  any                                                                    
research that could be done  in energy efficiencies with any                                                                    
partners including ACEP. Traditionally,  the majority of the                                                                    
funds had gone to projects  through the Cold Climate Housing                                                                    
Research Center  in Fairbanks.  Funds received  the previous                                                                    
year matched between $4 million  and $6 million for a little                                                                    
over $500,000 in state funds.                                                                                                   
Co-Chair Bishop  asked about  Item 9 on  slide 13,  and $1.5                                                                    
million  in UGF  for  the  Supplemental Housing  Development                                                                    
Program. He  asked if the  AHFC Board had approved  a higher                                                                    
number than shown.                                                                                                              
Mr.  Butcher  detailed  that  the  board  had  requested  $3                                                                    
million for the program.                                                                                                        
10:23:48 AM                                                                                                                   
Mr.  Steininger referenced  slide  14,  "FY2022 Projects  by                                                                    
     Revenue - continued                                                                                                        
     10. AHFC Energy Programs Weatherization $3,000.0 Fed                                                                       
     11.  MH:  AHFC  Homeless  Assistance  Program  $4,550.0                                                                    
     ($3,600.0  UGF    AHFC  Div, $950.0  Other    MH  Trust                                                                    
     12.  MH: AHFC  Beneficiary  and  Special Needs  Housing                                                                    
     $1,700.0  ($1,500.0  DGF  - MH  Trust  Reserve,  $200.0                                                                    
     Other - MH Trust Authority)                                                                                                
     Transportation and Public Facilities                                                                                       
     1. Computerized Maintenance  Management System (CMMS) -                                                                    
     Year 3 $1,509.5 UGF                                                                                                        
     2. Weigh Station Scale Repairs $1,000.0 UGF                                                                                
     3.  Alaska  Marine   Highway  System  Vessel  Overhaul,                                                                    
     Annual    Certification   and    Shoreside   Facilities                                                                    
     Rehabilitation $15,000.0 UGF                                                                                               
     4. State Equipment Fleet  Replacement $22,000.0 Other                                                                      
     Highways/Equipment Working Capital Fund                                                                                    
Co-Chair Stedman referenced item 3  and item 4 under DOT. He                                                                    
thought the  DOT subcommittee would  consider the  items and                                                                    
get back  to the committee with  recommendations. He thought                                                                    
Co-Chair  Bishop had  been working  on the  SEF for  several                                                                    
Senator  Hoffman  looked  at $3  million  in  federal  funds                                                                    
listed  in   item  10  under   DOR.  He  thought   the  AHFC                                                                    
weatherization  program was  well-proven., and  in the  past                                                                    
the  state had  spent close  to  $1 billion.  He thought  it                                                                    
seemed like  the state  should have  some investment  in the                                                                    
program.  He   requested  the  administration   should  look                                                                    
further at  the program,  which had a  direct impact  on the                                                                    
citizens of  the state.  he thought if  the state  was truly                                                                    
going to  reduce energy costs  for Alaskans as  the governor                                                                    
had mentioned in  his State of the State  address, the state                                                                    
investment should  approach a minimum of  $250,000. He asked                                                                    
the administration to take another look at the item.                                                                            
10:27:00 AM                                                                                                                   
Senator  Wielechowski  wondered  about  the  possibility  of                                                                    
federal  matching funds  for weatherization  that the  state                                                                    
had not  applied for. He  asked Mr. Steininger to  look into                                                                    
the matter.                                                                                                                     
Mr. Steininger agreed to look into the matter.                                                                                  
Mr.  Steininger  turned to  slide  15,  "FY2022 Projects  by                                                                    
     Transportation and Public Facilities - continued                                                                           
     5.  Alaska   International  Airport   System  $68,722.1                                                                    
     ($722.1  Other     International  Airport  Construction                                                                    
     Fund,  $20,800.0 Other     Int.  Airport Revenue  Fund,                                                                    
     $47,200.0 Fed)                                                                                                             
    6. Rural Airport Improvement Program $190,000.0 Fed                                                                         
     7.  Alaska  International Airport  System  Reimbursable                                                                    
     Projects  $10,000.0  ($5,000.0  Other     Int.  Airport                                                                    
     Revenue Fund, $5,000.0 Fed)                                                                                                
     8. Surface Transportation Program $680,000.0 Fed                                                                           
     9. Federal-Aid  Aviation State Match $14,700.0  Other -                                                                    
     AHFC Bonds                                                                                                                 
     10. Federal-Aid Highway State Match $71,200.0 Other                                                                        
     AHFC Bonds                                                                                                                 
     11. Other Federal Program Match $1,300.0 GF Match                                                                          
     12.   Cooperative   Reimbursable   Projects   $15,000.0                                                                    
     ($10,000.0 Other - SDPR, $5,000.0 Fed)                                                                                     
     13. Federal Emergency Projects $10,000.0 Fed                                                                               
     14. Federal Transit Administration Grants $10,000.0                                                                        
Mr.  Steininger clarified  that lines  9 and  10 represented                                                                    
proposed  AHFC  bonding  for the  state  match  for  federal                                                                    
aviation aid. In normal years, the funds would be UGF.                                                                          
Senator Wilson asked for a list of AHFC bonding projects.                                                                       
Mr. Steininger  agreed to provide the  information. The list                                                                    
was also included with legislation  that would authorize the                                                                    
bonds.  In  short,  he  listed  the  surface  transportation                                                                    
matching funds,  the aviation transportation  funding match,                                                                    
and the two village safe water projects.                                                                                        
Co-Chair Bishop asked  for Mr. Steininger to  address item 9                                                                    
and  item  10. He  asked  for  further  detail on  why  AHFC                                                                    
bonding was proposed to be utilized.                                                                                            
Mr.  Steininger   explained  that  the  reason   the  budget                                                                    
proposed  to  use AHFC  bonding  was  due to  knowing  state                                                                    
funding  would not  be sufficient  to meet  obligations. The                                                                    
administration  had looked  for  areas in  which to  utilize                                                                    
different  fund  sources  to ensure  that  there  was  money                                                                    
retained in  the CBR  and liquid assets.  Since there  was a                                                                    
low interest  rate environment, there was  some advantage to                                                                    
bonding. He noted that AHFC  had communicated that there was                                                                    
an  opportunity  in  the  bonding  capacity  to  assist  the                                                                    
state's financial  situation through  the capital  budget to                                                                    
free up UGF for other  state needs. He acknowledged that the                                                                    
scenario  was a  one-time  situation for  the current  year,                                                                    
which  would leave  some  cash in  the  state's accounts  to                                                                    
satisfy other obligations.                                                                                                      
10:31:14 AM                                                                                                                   
Co-Chair Stedman  was concerned  about using  one-time items                                                                    
and thought it  was important to consider how  AHFC would be                                                                    
constrained  in  the  future. He  contemplated  the  state's                                                                    
significant   expenditures  such   as  the   Permanent  Fund                                                                    
Dividend  (PFD),  K-12  education,   and  health  and  human                                                                    
services. He  did not think  the state could  continue along                                                                    
with  the   current  structure  in  statute.   He  discussed                                                                    
changing  the PFD  amount and  thought there  could be  more                                                                    
flexibility.  He thought  there  would  be robust  committee                                                                    
discussion, some  fund source changes and  increased clarity                                                                    
so  that  members  could make  the  best-informed  decisions                                                                    
possible. He worried  about putting too much  strain on AHFC                                                                    
so that  it could not help  in the future. He  was skeptical                                                                    
about the fund sources being presented.                                                                                         
Co-Chair  Bishop shared  that  he had  concerns about  using                                                                    
AHFC  funds. He  understood there  were housing  problems in                                                                    
rural Alaska. He mentioned teachers,  nursing, and the court                                                                    
system. He did not want  to hinder AHFC's ability to address                                                                    
other important  issues in the state.  He mentioned deferred                                                                    
maintenance   and    wanted   the   legislature    and   the                                                                    
administration  to work  together  towards implementing  the                                                                    
one percent rule for an increment to the building fund.                                                                         
10:34:33 AM                                                                                                                   
Mr.  Steininger considered  slide  16,  "FY2022 Projects  by                                                                    
     Transportation and Public Facilities - continued                                                                           
     15. Highway Safety Grants Program $8,033.9 ($33.9 UGF,                                                                     
     $8,000.0 Fed)                                                                                                              
     16. Federal-Aid Highway Project Match Credits $1,000.0                                                                     
     DGF - Program Receipts                                                                                                     
     17. MH: Coordinated Transportation and Vehicles                                                                            
     $1,300.0 ($1,000.0 MH GF, $300.0 MH Trust Authority)                                                                       
     1. Courts Statewide Deferred Maintenance $2,300.0 UGF                                                                      
Senator  Hoffman asked  for the  total deferred  maintenance                                                                    
for the court system.                                                                                                           
Mr. Steininger did  not have a number  readily available but                                                                    
offered to  provide a comprehensive  list of  all identified                                                                    
deferred maintenance projects.                                                                                                  
Senator Hoffman  assumed that the  list was well  above $100                                                                    
million.  He wanted  to  have the  number  available to  the                                                                    
committee so  members could  consider the  appropriation. He                                                                    
thought the proposed  funding was a token  amount to address                                                                    
the maintenance  for the court  system. He thought  the same                                                                    
was true for  the University system as well  as the Regional                                                                    
Educational  Attendance  Area  (REAA) maintenance  list.  He                                                                    
knew that Co-Chair Bishop was aware of the situation.                                                                           
Mr.  Steininger clarified  that the  court system  statewide                                                                    
deferred maintenance amount had  been requested by the court                                                                    
system. He  acknowledged that as Senator  Hoffman had noted,                                                                    
the amount was small in comparison to the overall backlog.                                                                      
Senator Hoffman encouraged  the court system to  take a look                                                                    
at the list  and come up with a supplemental  list to submit                                                                    
to  the  administration  as  well as  the  chairman  of  the                                                                    
capital budget.                                                                                                                 
Mr.   Steininger  displayed   slide   17,  "FY2021   Capital                                                                    
     *SB 48 Fast Track Supplemental                                                                                             
     **SB 50 Supplemental in FY2022 Governor                                                                                    
     ***SB TBD Regular Supplemental                                                                                             
Mr.  Steininger clarified  that the  following slides  would                                                                    
address capital  appropriations that  had a FY  21 effective                                                                    
date,  which  were  distributed across  three  appropriation                                                                    
bills  denoted with  asterisks  as shown  on  the slide.  He                                                                    
noted  that there  was a  supplemental spreadsheet  (copy on                                                                    
file) that  gave more detail  about each item.  He explained                                                                    
that SB 48 included  items the administration thought needed                                                                    
to be passed sooner, and SB  50 included items for FY 22. He                                                                    
explained  that "SB  TBD  Regular  Supplemental" items  were                                                                    
emergent things that  came up during the course  of the year                                                                    
and had  varying levels of  urgency with project  timing but                                                                    
fit within FY 21 as an effective date.                                                                                          
Mr.  Steininger highlighted  slide 18,  "FY2021 Supplemental                                                                    
Projects,"  which  showed  a  data  table  with  an  overall                                                                    
summary. He  noted that negative numbers  represented repeal                                                                    
of  capital projects  that  finished  with additional  money                                                                    
left.  The  number  represented  a  reduction  in  available                                                                    
capital authority for the projects.                                                                                             
10:39:35 AM                                                                                                                   
Mr.  Steininger looked  at  slide  19, "FY2021  Supplemental                                                                    
     1. *Retirement  System Server Replacement  $230.4 Other                                                                    
     ($162.0  P/E  Retirement  System Fund,  $67.0  Teachers                                                                    
     Retirement  System   Fund,  $1.4   Judicial  Retirement                                                                    
     Commerce, Community & Economic Development                                                                                 
     1. *Blood Bank of Alaska $2.3 UGF  AHFC Dividend                                                                           
     2. ***Alaska Energy  Authority - Electrical Emergencies                                                                    
     Program $200.0 UGF                                                                                                         
     3. ***National Petroleum Reserve  - Alaska Impact Grant                                                                    
     Program $17,908.8 Fed  NPR Fund                                                                                            
     1.  *Court Security  Improvements $1,551.1  UGF    AHFC                                                                    
     2.  *Statewide Deferred  Maintenance    Courts $1,551.2                                                                    
     DGF  Capital Income Fund Dollars in thousands                                                                              
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr.  Steininger  noted   that  the  fast-track  supplemental                                                                    
included a  handful of capital  projects that  were proposed                                                                    
the  previous  year  but not  appropriated  because  of  the                                                                    
shortened legislative  session. He  detailed that  the funds                                                                    
for the  Blood Bank of  Alaska were owed from  license plate                                                                    
Co-Chair Stedman commented  on item 1 on  the upcoming slide                                                                    
20, which regarded Mt. Edgecumbe  High School. He noted that                                                                    
while  the school  was in  his district,  the students  were                                                                    
from  Senator  Hoffman  and Senator  Olson's  districts.  He                                                                    
highlighted that  there was  a large-scale  hospital project                                                                    
being built  in the area,  similar to the hospital  built in                                                                    
Bethel. There  was work  being done  to transfer  lands from                                                                    
the  school   to  the   Southeast  Alaska   Regional  Health                                                                    
Consortium  (SEARHC).   The  lands   had  to  be   used  for                                                                    
educational purposes  and an endowment was  being considered                                                                    
to  provide a  revenue  stream for  the  school. He  thought                                                                    
there was obviously  a need for updated  plans and classroom                                                                    
expansion.  He  thought  the  school was  the  only  one  in                                                                    
Southeast  Alaska   that  needed  classroom   expansion.  He                                                                    
thought the proposed funds would be well spent.                                                                                 
10:43:41 AM                                                                                                                   
Senator  Hoffman thought  that not  only would  the hospital                                                                    
project provide  Southeast Alaska  with a  stimulus package,                                                                    
but there would also be additional jobs in healthcare.                                                                          
Senator  Olson   wanted  voice  his  support   for  the  Mt.                                                                    
Edgecumbe High  School master plan update.  He informed that                                                                    
many of  his constituents went  to Sitka for high  school at                                                                    
Mt. Edgecumbe.                                                                                                                  
Co-Chair  Bishop  referenced  the retirement  system  server                                                                    
replacement.  He recalled  that the  state had  appropriated                                                                    
$500,000 several  years ago for  the same project.  He asked                                                                    
if the funds were new money that was needed.                                                                                    
Mr.  Steininger stated  the funds  were new  and that  other                                                                    
funds  were collected  in the  retirement  system and  could                                                                    
only  be  used  for  limited purposes.  The  funds  were  in                                                                    
addition to  prior appropriations.  He agreed to  provide an                                                                    
update on  the prior  appropriations and  the status  of the                                                                    
10:46:02 AM                                                                                                                   
Senator Hoffman spoke to item 2  under DCCED on slide 19. He                                                                    
had mentioned earlier  that there was no  funding to address                                                                    
the REAA  school construction commitment from  the state. He                                                                    
referenced  the Kasayulie  settlement and  court decree  [In                                                                    
1997, Kasayulie  and other parties  brough suit  against the                                                                    
State  of Alaska  regarding the  method  of funding  capital                                                                    
projects  for education.  The Kasayulie  Consent Decree  and                                                                    
Settlement  Agreement addressed  the violations  of law  and                                                                    
provided remedies  for these violations].  He felt  that the                                                                    
legislature was not in compliance  with the decree and asked                                                                    
Co-Chair  Bishop  to  consult  with  the  Legislative  Legal                                                                    
Department on  the matter. He  noted that the  previous year                                                                    
the administration had not  proposed appropriating funds for                                                                    
addressing the  payment of  debt to  urban Alaska,  while in                                                                    
the  current year  the budget  addressed  urban schools  but                                                                    
completely  ignored  the  needs  of the  children  in  rural                                                                    
Alaska. He  thought the  state was  addressing the  needs of                                                                    
urban students and ignoring rural Alaska.                                                                                       
Co-Chair Stedman  observed that there was  a mechanical tie-                                                                    
in  between school  bond  debt  reimbursement for  organized                                                                    
areas of the  state, with a calculation for  rural areas. He                                                                    
recalled that  the committee's policy in  previous years had                                                                    
been for  100 percent debt reimbursement  for the community.                                                                    
He  thought  the  committee was  in  disagreement  with  the                                                                    
administration on  the issue. He  recognized that  there was                                                                    
50 percent  funding in the  proposed budget.  He anticipated                                                                    
that  the  committee  would be  discussing  the  matter  and                                                                    
whether or  not the  members wanted to  fund 100  percent of                                                                    
debt  reimbursement along  with  the REAA  funds  as in  the                                                                    
past.  He did  not  know of  any  legislative policy  change                                                                    
relating  to wanting  100 percent  bond debt  reimbursement.                                                                    
The  issue  affected the  Mat-Su  area  and Western  Alaska,                                                                    
where school construction  was needed. He failed  to see how                                                                    
the legislature would convince organized  areas of the state                                                                    
to  build schools  at 100  percent of  the cost.  He thought                                                                    
there were  policy differences  between the  legislature and                                                                    
the executive branch that needed to be rectified.                                                                               
Senator Hoffman  wanted to clarify  that he did  not believe                                                                    
the   administration  intentionally   discriminated  between                                                                    
urban and  rural Alaska. He  thought the consequence  of the                                                                    
oversight of funding for rural schools was not intentional.                                                                     
Co-Chair Bishop thought the committee  would want to discuss                                                                    
major school  maintenance, because  it was  also not  in the                                                                    
10:50:29 AM                                                                                                                   
Mr. Steininger wanted  to clarify that there  was 50 percent                                                                    
funding for  school bond debt reimbursement  included in the                                                                    
governor's operating  budget, as well as  50 percent funding                                                                    
of the REAA Fund deposit  in the fund capitalization section                                                                    
of the operating budget.                                                                                                        
Senator Hoffman  wanted to verify  the items in  the budget.                                                                    
When he had asked about the  funds in a previous meeting, he                                                                    
had been told there was no funds in the budget.                                                                                 
Mr.  Steininger  addressed  slide 20,  "FY2021  Supplemental                                                                    
     1. ***Mt. Edgecumbe High School Master Plan Update                                                                         
     $330.0 DGF  School Fund                                                                                                    
     2. ***Statewide School Capital Funding Forecast                                                                            
     Database $240.0 DGF  School Fund                                                                                           
     Environmental Conservation                                                                                                 
     1.    ***   Village    Safe   Water    and   Wastewater                                                                    
     Infrastructure   Projects:   Expansion,  Upgrade,   and                                                                    
     Replacement of Existing Service $1,460.0 GF Match                                                                          
     2. ***Village Safe  Water and Wastewater Infrastructure                                                                    
     Projects:  First  Time  Service  Projects  Supplemental                                                                    
     $2,190.0 GF Match                                                                                                          
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr. Steininger noted that the  federal grant associated with                                                                    
item 1 under DEC  had increased significantly and additional                                                                    
matching  funds  were  required.   The  department  had  the                                                                    
existing  federal authority  to  collect  the federal  funds                                                                    
associated  with the  match, therefore  the  funds were  not                                                                    
Co-Chair Bishop  thought it  would be nice  to see  what the                                                                    
state's matching General Fund dollars were leveraging.                                                                          
Mr.  Steininger affirmed  he  would  provide the  additional                                                                    
information related to federal funds for item 1.                                                                                
Mr. Steininger  advanced to  slide 21,  "FY2021 Supplemental                                                                    
     Fish and Game                                                                                                              
     1.  *Pacific Salmon  Treaty Chinook  Fishery Mitigation                                                                    
     $7,700.0 Fed                                                                                                               
     2.  *Facilities,  Vessels   and  Aircraft  Maintenance,                                                                    
     Repair and Upgrades $500.0 DGF  Capital                                                                                    
     Income Fund                                                                                                                
     3. *Sport  Fish Recreational Boating and  Angler Access                                                                    
     $3,000.0 ($750.0 Other - Fish and Game                                                                                     
     Fund, $2,250.0 Fed)                                                                                                        
     4.  *Wildlife Management,  Research and  Hunting Access                                                                    
     $10,000.0 ($50.0  Other - Fish and  Game Fund, $2,450.0                                                                    
     Other - SDPR, $7,500.0 Fed)                                                                                                
     1.  *Primary  and  General Elections  Security  Due  to                                                                    
     COVID-19 $3,000.0 Other - Election Fund                                                                                    
     2.  *Statewide  Deferred Maintenance,  Renovation,  and                                                                    
     Repair $5,903.8 DGF - Capital Income Fund                                                                                  
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr. Steininger  noted that  item 1  under DFG  was redundant                                                                    
with a  project in the FY  22 request, and would  be removed                                                                    
with  an  amendment.  There   was  funding  for  much-needed                                                                    
maintenance on  vessels, facilities,  and aircraft  that was                                                                    
utilized by  DFG. In the  Office of the Governor,  there was                                                                    
proposed $3  million appropriation for a  grant received for                                                                    
election security.  He discussed the Division  of Elections'                                                                    
need  to  utilize  the  funds.  He  pointed  out  additional                                                                    
statewide deferred  maintenance and  noted that there  was a                                                                    
much larger request for FY 22.                                                                                                  
10:54:13 AM                                                                                                                   
Mr.  Steininger looked  at  slide  22, "FY2021  Supplemental                                                                    
     1.  *Prosecutor  Recruitment  and  Housing  to  Address                                                                    
     Sexual  Assault  and  Sexual  Abuse  of  a  Minor  Case                                                                    
     Backlog $4,000.0 DGF  Higher Ed Fund                                                                                       
     Military and Veterans Affairs                                                                                              
     1.  *Bethel Readiness  Center Security  Upgrades $140.0                                                                    
     ($70.0 DGF  Capital Income Fund, $70.0 Fed)                                                                                
     2.  *Bethel Readiness  Center Water  System Sustainment                                                                    
     $250.0 ($125.0 DGF  Capital Income Fund, $125.0 Fed)                                                                       
     3.   *Kotzebue   Readiness   Center   HVAC   Life-Cycle                                                                    
     Replacement $500.0  ($250.0 DGF   Capital  Income Fund,                                                                    
     $250.0 Fed)                                                                                                                
     4.  *Statewide  Roof,  Envelope,  and  Fall  Protection                                                                    
     $1,700.0  ($850.0 DGF     Capital  Income Fund,  $850.0                                                                    
     5.     ***Reappropriation     from    Department     of                                                                    
     Administration for Alaska Land  Mobile Radio Dollars in                                                                    
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr. Steininger  pointed out key maintenance  items that were                                                                    
included  in the  fast track  supplemental. The  items would                                                                    
benefit from the  ability to start earlier  rather than wait                                                                    
for the next fiscal year.  He explained that the Alaska Land                                                                    
Mobile  Radio   System  (ALMR)  listed  under   item  5  was                                                                    
transferred  from the  Department of  Administration to  the                                                                    
Department  of  Military  and  Veterans  Affairs.  The  item                                                                    
proposed  to  clean  up  the  department  listing  on  prior                                                                    
appropriation of capital projects.                                                                                              
Co-Chair  Bishop  asked   for  a  total  of   how  much  the                                                                    
reappropriation for ALMR was.                                                                                                   
Mr. Steininger agreed to provide the information.                                                                               
Mr.  Steininger  spoke  to slide  23,  "FY2021  Supplemental                                                                    
     Natural Resources                                                                                                          
     1.  *PARKS Land  and  Water  Conservation Fund  Federal                                                                    
     Grant  Program   $4,400.0  ($900.0  UGF      AHFC  Div,                                                                    
     $3,500.0 Fed)                                                                                                              
     2.  *Geologic Materials  Center Multispectral  Scanning                                                                    
     Equipment $1,290.0  ($865.0 UGF - AHFC  Div, $275.0 DGF                                                                    
     - Program Receipts, $150.0 Other - SDPR)                                                                                   
     3.  ***Enhance Capacity  at Geological  Material Center                                                                    
     $375.0 Other  SDPR                                                                                                         
     4.  ***Exxon Valdez  Oil Spill  Outreach $49.1  Other                                                                      
     EVOS Settlement                                                                                                            
     5. ***Land  Sales - New Subdivision  Development $750.0                                                                    
     Other  State Land Disposal Income Fund                                                                                     
     1.  *Reapprop   for  Tax  Expertise,   Economic  Impact                                                                    
     Analysis, and Legal Analysis - Est $484.4                                                                                  
     2. **Revenue Collections  System Enhancements $24,529.4                                                                    
     ($10,000.0 DGF - Program Receipts, $15,529.4 Fed)                                                                          
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr. Steininger  noted that  the federal  funding for  item 1                                                                    
under DNR had gone up since the previous year.                                                                                  
Co-Chair Stedman asked about item  1 under the Department of                                                                    
Revenue. He  asked how quickly  the economic  analysis would                                                                    
be  implemented. He  pointed out  that  the legislature  was                                                                    
already underway with addressing  the structural deficit. He                                                                    
thought the  legislature might  have conclusions  before the                                                                    
consultants had conclusions.                                                                                                    
Mr. Steininger stated  the item was proposed as  part of the                                                                    
fast-track   supplemental  because   the  discussions   were                                                                    
already happening. He suggested that  access to the level of                                                                    
expertise   requested  was   critical  to   analyze  various                                                                    
proposals that might come forward.                                                                                              
Co-Chair  Stedman   asked  if  the  analysis   would  be  of                                                                    
proposals  that might  come forward,  or rather  analysis of                                                                    
proposals to be  assembled and put forward  by the executive                                                                    
branch. He wondered if the  analysis would be advocating tax                                                                    
increases to the citizens.                                                                                                      
Mr.  Steininger  stated  that  the  administration  had  not                                                                    
introduced  a  specific  tax proposal,  but  it  needed  the                                                                    
expertise  to  analyze  any ideas  or  proposals  that  came                                                                    
forward or could be brought forward.                                                                                            
10:59:56 AM                                                                                                                   
Senator von  Imhof asked why  the legislature  should expend                                                                    
$484,000 if  the governor was  not going to put  forward any                                                                    
tax proposals.  She wondered what consultants  would analyze                                                                    
if the  legislature did not  put forward any  tax proposals.                                                                    
She  wondered if  it made  sense to  allocate the  money and                                                                    
have the  governor put  forward a bill  or two  with revenue                                                                    
Mr. Steininger  did not want  to speculate about  what bills                                                                    
might  go  forward  but  asserted  that  the  administration                                                                    
needed to  investigate the impacts of  various measures that                                                                    
could be put forward. He  asserted that having the expertise                                                                    
to  do the  research  work and  understand  the impacts  was                                                                    
critical to  inform opinions  on potential  revenue measures                                                                    
that might be proposed.                                                                                                         
Co-Chair Stedman thought there was  a $5 billion proposal to                                                                    
bring gas  from Point  Thomsen. He asked  if there  had been                                                                    
analysis  of  the  potential impact  that  might  take  into                                                                    
account the  impact on the  treasury, credits,  offsets, and                                                                    
impacts on royalties. He  mentioned Point Thomson Settlement                                                                    
Agreement issues.                                                                                                               
Mr.  Steininger thought  the Point  Thomson  question was  a                                                                    
much larger topic that he deferred to DNR's analysis team.                                                                      
Co-Chair Bishop  thought Co-Chair  Stedman's question  was a                                                                    
good question for the following day's meeting.                                                                                  
11:02:19 AM                                                                                                                   
Mr.  Steininger referenced  slide  24, "FY2021  Supplemental                                                                    
     Transportation and Public Facilities                                                                                       
     1.   *Decommissioning  and   Remediation  of   Class  V                                                                    
     Injection Wells $1,700.0 UGF  AHFC Div                                                                                     
     2.   *Public   Building  Fund   Deferred   Maintenance,                                                                    
     Renovation,  Repair  and  Equipment  $5,946.0  Other                                                                       
     Public Building Fund                                                                                                       
     3.  **Reappropriation  of  Unexpended Balances  to  the                                                                    
     Commercial Passenger  Vessel Tax Account  $-8.595 Other                                                                    
       Commercial Passenger Vessel Tax                                                                                          
     4.  **Reappropriation  of  Unexpended Balances  to  the                                                                    
     Alaska Capital  Income Fund $-16,542.8  ($-9,500.0 CBR,                                                                    
     $-3,252.3  UGF, $-3,790.5  DGF -  Capital Income  Fund)                                                                    
     Dollars in thousands                                                                                                       
     *SB 48 Fast Track  Supplemental **SB 50 Supplemental in                                                                    
     FY2022 Governor ***SB TBD Regular Supplemental                                                                             
Mr. Steininger noted that item  3 and item 4 were reflective                                                                    
of negative  numbers he had mentioned  earlier and signified                                                                    
repeals of existing capital projects.  The funds from item 3                                                                    
would  go  back into  the  Commercial  Passenger Vessel  Tax                                                                    
Account and  had federal spending restrictions.  The dollars                                                                    
from item 4  were proposed to be deposited  into the Capital                                                                    
Income Fund in  the operating budget to  bolster the ability                                                                    
to support deferred maintenance activities.                                                                                     
Senator Wilson  asked if  Mr. Steininger  saw any  issues or                                                                    
challenges with the reappropriation proposed in item 4.                                                                         
Mr.  Steininger asked  if Senator  Wilson  was referring  to                                                                    
challenges in terms of whether the funds were available.                                                                        
Senator Wilson  noted that  some of the  funds were  from GO                                                                    
bonds,  and  other  funds  were  related  to  Constitutional                                                                    
Budget  Reserve  (CBR)  access.   He  mentioned  the  three-                                                                    
quarters vote required to access funds.                                                                                         
Mr.  Steininger stated  that the  GO bond  mentioned by  Mr.                                                                    
Steininger was  more of  a clerical  error. He  relayed that                                                                    
the  administration  had  been   in  conversation  with  LFD                                                                    
regarding interpretations  of reappropriation  mechanisms of                                                                    
CBR  projects. There  was discussion  as to  how the  monies                                                                    
would  be implemented  and  there  were technical  questions                                                                    
being worked through.                                                                                                           
Senator Hoffman  noted that during  the last address  by the                                                                    
congressional   delegation   Senator  Lisa   Murkowski   had                                                                    
mentioned  that the  federal government  and her  office had                                                                    
looked  into  small-scale nuclear  power  as  an option  for                                                                    
Alaska.  The committee  had spent  several hundred  thousand                                                                    
dollars  to get  a report  on  the matter.  He relayed  that                                                                    
there had  been an update  the previous month by  the Alaska                                                                    
Center for Energy and Power.  He stated he would provide the                                                                    
report to the committee.  He quoted the letter's conclusion:                                                                    
"It  is  imperative  for  Alaskans  to  make  careful  well-                                                                    
informed decisions  about nuclear development in  our unique                                                                    
Senator Hoffman  had received a  letter the  previous summer                                                                    
regarding the  Kasayulie case, which  he would  also provide                                                                    
to members. The  letter was from Holland and  Knight and was                                                                    
dated  July  24,   2019  and  asked  for   response  to  the                                                                    
administration's decision  of how it was  treating the case.                                                                    
The letter  asked the governor  to reassess his  position on                                                                    
the case. He  did not know if the letter  had been responded                                                                    
to but  wanted a copy  of any  response. The authors  of the                                                                    
letter were holding to the  consent decree, and if the state                                                                    
did not comply  had planned on reopening the  case. He asked                                                                    
Mr.  Steininger to  make any  written response  available to                                                                    
the committee.                                                                                                                  
Co-Chair Bishop discussed the agenda for the following day.                                                                     
11:08:25 AM                                                                                                                   
The meeting was adjourned at 11:08 a.m.                                                                                         

Document Name Date/Time Subjects
020321 SB 50 SFIN Capital Budget Overview .pdf SFIN 2/3/2021 9:00:00 AM
SB 50
020321 FY21 Supp Capital Project Summary.pdf SFIN 2/3/2021 9:00:00 AM
SB 50
020321 FY22 Gov Capital Project Summary.pdf SFIN 2/3/2021 9:00:00 AM
SB 50
020321 SB 50 Mike Abbott, Mental Health Trust Authority, letter, 26 January 2021.pdf SFIN 2/3/2021 9:00:00 AM
SB 50
020321 OMB Senate Finance Committee Capital Overview Response.pdf SFIN 2/3/2021 9:00:00 AM
SB 50
020321 OMB Attachments.zip SFIN 2/3/2021 9:00:00 AM
SB 50