Legislature(2001 - 2002)
03/13/2001 06:15 PM Senate FIN
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
MINUTES
SENATE FINANCE COMMITTEE
March 13, 2001
6:15 PM
TAPES
SFC-01 # 37, Side A
SFC 01 # 37, Side B
SFC 01 # 38, Side A
CALL TO ORDER
Co-Chair Pete Kelly convened the meeting at approximately 6:15 PM.
PRESENT
Senator Dave Donley, Co-Chair
Senator Pete Kelly, Co-Chair
Senator Jerry Ward, Vice Chair
Senator Loren Leman
Senator Lyda Green
Senator Gary Wilken
Senator Donald Olson
Senator Alan Austerman
Senator Lyman Hoffman
Also Attending: NICO BUS, Administrative Services Manager, Division
of Support Services, Department of Military and Veterans Affairs
and Department of Natural Resources; PAT POURCHOT, Commissioner,
Department of Natural Resources; ANNALEE MCCONNELL, Director,
Office of Management and Budget, Office of the Governor; LARRY
DIETRICK, Director, Division of Spill Prevention & Response,
Department of Environmental Conservation; PATRICK GALVIN, Director,
Governmental Coordination, Office of the Governor; KEN FREEMAN,
Special Assistant Gasline & Business Development, Office of the
Governor; WILSON CONDON, Commissioner, Department of Revenue,
REMOND HENDERSON, Director, Division of Administrative Services,
Department of Labor & Workforce Development
Attending via Teleconference:
From Anchorage: HAROLD RILEY, Deputy Director, Installations,
Alaska Army National Guard, Department of Military and Veterans
Affairs; KELLY NICOLELLO, Assistant State Fire Marshall, Division
of Fire Prevention, Department of Public Safety; WILLIAM BRITT,
State Gas Pipeline Coordinator, Department of Natural Resources;
JIM STRATTON, Director, Division of Parks & Outdoor Recreation,
Department of Natural Resources
SUMMARY INFORMATION
SB 29 - APPROP: GOVERNOR'S CAPITAL BUDGET
The Committee heard overviews of the Capital Budget from the
Department of Military and Veterans Affairs and the Department of
Natural Resources.
SENATE BILL NO. 29
"An Act making capital appropriations and capitalizing funds;
making appropriations under art. IX, sec. 17(c), Constitution
of the State of Alaska, from the constitutional budget reserve
fund; and providing for an effective date."
Department of Military and Veterans Affairs
Army Guard Facilities Deferred Maintenance,
$800,000
$600,000 Federal Receipts
$200,000 General Funds
Reference No: 34009
AP/AL: Appropriation
Project Type: Deferred Maintenance
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Deferred Maintenance and Scheduled Renewal & Replacement of
the Army Guard Facilities around the State. By performing
preventative maintenance, The Facilities Management Division
is able to extend the life expectancy of various buildings,
components and machinery. The preventative maintenance also
decreases the possibility of costly emergency replacements.
There does come a time when these items must be replaced and
thus fall upon the backlog. The average age of the buildings
for the Alaska Army National Guard is 28 years old as of FY
00. The oldest buildings are Training Sites at average age of
34 years and State armories in a close second at 30 years.
On-going project
NICO BUS, Administrative Services Manager, Division of Support
Services, Department of Military and Veterans Affairs and
Department of Natural Resources informed the Committee that there
are armories in seventy-six communities in the state and the needs
are for roof repairs and other key issues.
Facilities Spill Prevention and Countermeasures
$120,000
$104,400 Federal Receipts
$ 15,600 General Fund Match
Reference No: 32563
AP/AL: Appropriation
Project Type: Health and Safety
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2007
Any facility having a fuel tank with over a 660 gallon
capacity, or a total combined capacity over 1320 gallons,
requires a Spill Prevention Control and Countermeasures (SPCC)
plan under the Clean Water Act. These plans require the
signature of a licensed engineer, and at a minimum must be
reviewed every three years. State and Military Facilities are
not exempt.
On-going project
Mr. Bus reviewed the request and explained that each of the SPCC
plans costs approximately $5,000 and the Department tries to
complete plans for twenty-four of the facilities each year. Mr. Bus
stated that the work is required and if it were not done, the
Department would be penalized.
Co-Chair Donley stated these are relatively small tanks and
inquired as to why it costs $5,000 to develop a spill response plan
for each one, in light of having already done several other plans.
Co-Chair Donley also inquired if the private sector had ever been
approached about doing the work.
HAROLD RILEY, Deputy Director, Military and Veterans Affairs,
testified via teleconference from Anchorage and informed that a
local private company, Ogden Environmental, had done the prior
work, and historically, $5,000 per SPCC plan was the cost.
Co-Chair Donley asked if the project had gone through the
competitive bid process.
Mr. Riley replied a Request for Proposals (RFP) had been issued to
solicit local contractors and the request included a visit to each
location to verify the site conditions. He reiterated that the
plans for each site have to be updated every three years as a
requirement of the Clean Water Act.
Co-Chair Donley commented that the cost seems excessive to him,
especially if renewals are expected every three years for each
site. He questioned why a cost of $5,000 was incurred if the plan
was just being renewed and if the RFP specified one contractor for
all the sites.
Mr. Riley replied yes, the same contractor did all the sites. He
said the RFP was issued every three years, with the bid awarded by
the Federal Contracting Office at Fort Richardson. Mr. Riley agreed
that the cost seemed high, and that he "would like to see the cost
come down."
Co-Chair Kelly commented that although the state match for this
project is small, there is still responsibility for how that state
money is spent.
Co-Chair Donley commented that the federal government could improve
the way contracts are awarded, but the state could not really do
anything to change that situation.
Bethel Readiness Center Planning and Design
$750,000 General Funds
Reference No: 34848
AP/AL: Appropriation
Project Type: Planning
Category: Public Protection
Location: Bethel
Election District: Bethel, Dillingham
Estimated Project Dates: 07/01/2001 - 06/30/2011
Funding is required for the initial design of a new Readiness
nd
Center and Organizational Maintenance Shop for the 2
Battalion, headquartered in Bethel. Under National Guard
Bureau Regulation 415-12, The Readiness Center (previously
referred to as an "Armory") and Organizational Maintenance
Shop (OMS) do not meet the minimum design requirements for
these types of facilities. The initial design will address
architectural and engineering services to include preliminary
site investigation and environmental assessment.
One-time project
Amendment
Mr. Bus informed that the Bethel Readiness Center is thirty-nine
years old and could not meet the needs of the community. He said
this money would cover the costs of doing an environmental
assessment and a preliminary site investigation, which would then
make it eligible for federal funds for construction of a new
facility.
Co-Chair Kelly commented that $750,000 for planning and design
seemed "steep."
Mr. Riley responded that the last Military and Veterans Affairs
project of this nature cost $1.6 million. He commented that the
Bethel site conditions are more reasonable and $750,000 would cover
this phase of the project.
Senator Austerman inquired as to the projected total cost.
Mr. Riley replied $12 million for construction.
Senator Green commented that this request involved all general
funds, but there is reference to 75 percent federal funding.
Co-Chair Kelly said that he understood the 75 percent federal
funding would apply to the actual costs of construction.
Senator Green agreed that the federal match would be for actual
construction of the facility. She inquired if it was "typical" to
"front" a project like this with all general funds or was it
possible to receive a federal match at the initial stage.
Mr. Bus clarified that the costs of the initial site prep on this
type of project was funded from general funds. He continued that
the construction was then federally funded depending on the purpose
of the facility. The Readiness Facility met one federal matching
requirement, while the operation and maintenance of the facility
met a different federal matching requirement.
Mr. Riley informed that the construction of the Bethel Readiness
Center would be federally funded at 75 percent, matched by 25
percent state funds. He said that the Maintenance shop would be 100
percent federally funded. He clarified there is no federal match
for the design of the project as the federal government looks at
that as the "state's buy-in" to get the project to a level where it
can be congressionally funded.
Co-Chair Donley asked why the construction of this Center was only
75 percent federally funded when other projects were 90 percent
federally funded.
Mr. Bus clarified that all air/guard projects are 90 percent
federally funded, army/guard projects such as a Readiness Center
with a state mission are 75 percent federally funded, and training
sites are 100 percent federally funded.
Federal Scout Readiness Centers Energy Projects
$300,000 Federal Receipts
Reference No: 32560
AP/AL: Appropriation
Project Type: Renovation and Remodeling
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2002 - 06/30/2007
Replace doors, windows, insulate floors and re-skin roof and
walls with insulating panels in existing Federal Scout
Readiness Centers. The quick payback work is done, and we are
now insulating and sealing the buildings that require a
complete recovering of the exterior. Sites are selected based
on number of Guardsman at the site, the anticipated energy
savings generated by the upgrade, and the impact of the
upgrade on future recruiting in the area.
On-going project
Mr. Bus said this project is 100 percent federally funded and is
intended to improve the energy efficiencies of the facilities.
Federal Scout Readiness Center Construction
$1,700,000 Federal Receipts
Reference No: 6913
AP/AL: Appropriation
Project Type: Construction
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2001
Construct three Federal Scout Readiness Centers per year
throughout Alaska. Included in the Long Range plan. Schedules
are - Kipnuk, Newtok, and Mountain Village locations are
subject to change.
Phased project.
Mr. Bus summarized that the operations and maintenance of these
centers would also be 100 percent federally funded.
Alaska National Guard Counterdrug Support Program
$100,000 Federal Receipts
Reference No: 31915
AP/AL: Appropriation
Project Type: Health and Safety
Category: Public Protection
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 6/30/2002
This program participates in the U.S. Department of Justice
Forfeiture Program. This federal program's primary purpose is
to deter crime by depriving criminals of profits and proceeds
from their illegal activities.
On-going project
Mr. Bus recapped this is a program through which "property is
forfeited or repossessed and is then sold with the funds
distributed to participating agencies to buy assets to help in
future operations."
Alaska Veterans' Housing and Health Needs Survey
$200,000 General Funds
Reference No: 34767
AP/AL: Appropriation
Project Type: Planning
Category: Housing/Social Services
Location: Anchorage Areawide
Election District: Anchorage Areawide
Estimated Project Dates: 07/01/2001 - 06/30/2002
This survey by the Department of Military and Veterans
Affairs, the Department of Administration, and veterans'
service organizations establishes a comprehensive approach to
meeting the long-term care needs for all Alaskan veterans. The
survey will explore use of federal funding to improve or
expand Pioneer Homes, establish regional clinics, and test new
care programs and cost sharing. It will also help establish
programs that allow greater flexibility in the use of
veteran's medical benefits. Results will help define
alternative strategies, needs and requirements.
One-time project
Mr. Bus commented that this project is strongly supported by the
Veteran's Administration. He noted that Alaska is one of the few
states that does not have a Veterans' home.
Department of Natural Resources
Gas Pipeline Project
$10,242,800
$4,969,400 General Funds
$5,273,400 Statutory Designated Funds
Reference No: AMD34773
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2003
This project request summarizes state actions to be taken to
facilitate the development of a pipeline for North Slope
natural gas. Actions include initiating work on issuing state
rights-of-way; collecting data for permitting reviews;
development of an overall project labor agreement to provide
job opportunities for Alaskans; and review of the 1977
agreement between Canada and the United States, and
coordination with the Canadians to insure a collaborative
approach.
Phased project
Amendment
PAT POURCHOT, Commissioner, Department of Natural Resources, said
the development of the natural gas pipeline involves a number of
different state agencies with a "common goal" of anticipating and
speeding up the permitting process for a natural gasline for the
"commercialization of Alaska's North Slope gas." One of the focuses
is on reducing the cost of that project and assisting it in coming
online in approximately 2007. He detailed categories of activities
such as a joint gasline office which would coordinate pre-and-post-
application work; identification of necessary skilled workers;
possible "projects gaps;" the conducting of studies on such things
as the impact of the gas extraction on the oil fields in Prudhoe
Bay and the amount of available gas reserves beyond the proven
reserves; the use of Alaska owned "royalty" gas and how it should
be marketed in or outside of the state; filing of the right-of-way
applications that would trigger ongoing work by the agency in
direct permitting activities; and working with a memorandum of
understanding for reimbursable services.
Mr. Pourchot voiced that it is an expectation that much of the
permitting work would be reimbursed as the applicant pays most of
the costs of permitting.
Mr. Pourchot added that the Department anticipated this fiscal year
to conduct some field work on land-title work for right of ways and
to work with project applications on the design of facilities such
as pressure stations to best meet clean air quality standards.
Senator Austerman requested clarification on the department handout
that combined FY 01 and FY 02 figures. He recounted that FY 01
reflected a $1.96 million budget and twenty-three new employees,
whereas, FY 02 reflects another $4.9 million and another fifty-five
more employees. He wished to clarify that the approved FY 01 funds
were shifted to FY 02 so that together they totaled $6.9 million
and seventy-eight new employees.
Mr. Pourchot replied that all the budget requests are in the
original supplemental requests for FY 01. He said that some funding
requests became part of the fast-track and some remained in the
regular request.
ANNALEE MCCONNELL, Director, Office of Management and Budget,
Office of the Governor, commented that some of the current staff
positions in the Department are funded from other sources. She
clarified that what the department proposed in the FY 01
supplemental, in some cases was to use existing staff but to fund
them with general funds if their current fund source would not
allow them to work on a different project. She explained that
someone who worked full-time on a federal project might be shifted
to the gasline project and would, therefore, not be able to
continue being federally funded.
Ms. McConnell commented that the positions listed are new positions
that had been originally requested as part of the supplemental.
Senator Wilken mentioned that he had attended a recent hearing at
which it was stated that the gasline plan, route, and permits would
be in place by the end of the year. He conveyed it appeared that
most people thought that was a worthy goal, but wondered if it was
possible. He asked what happens to the money if there is not a plan
or a route other than the highway route is suggested.
Mr. Pourchot said that the Department thinks that the pre-
application work being proposed will be valuable and necessary for
the permits and does not view any of it "wasted work or effort." He
continued that the timing is hard to anticipate. The Department is
targeting December, but it could be January or February.
Mr. Pourchot stated the Department has included a provision for an
additional funding source if the "reimbursable status" was not
reached by the projected date. He continued that the timing was
"kind of a best guess at this stage" and acknowledged that there is
a window for a "cost tolerance level" that might be a factor on the
project ever coming to fruition.
Mr. Pourchot described two other route alternatives that had been
studied. He stated one was a stand-alone liquefied natural gas
(LNG) pipeline that would go overland to tidewater; however,
timing, available markets, and price do not support that route
although a lot of the current permitting work would apply. The
other route, he said was the "Over-the-Top route" that the
Department also did not think was viable "in terms of economics or
permitting," particularly if delays in permitting are figured in as
a factor of cost. He detailed that the "Over the Top route" would
involve such things as 300 miles of buried pipeline; an advanced
high pressure pipe system; and environment issues that would result
in a "long complex permitting process involving a lot of national
interests well beyond the borders of Alaska." He opined that these
factors could prohibit this route from being a "viable, realistic
option."
Ms. McConnell indicated that the Department is trying to have its
agencies effectively respond to all groups that are actively
pursuing various projects, and the addition of the gasline project
has increased the already busy workload. She commented that all
project groups, including the gasline entities, are asking the
department to meet, consult, and work with them through the
permitting requirements.
Ms. McConnell stressed the work is valuable as it helps move the
state forward in the gasline project. She informed that when
putting together the cost estimate for the work-fund application
period beginning December one, the Department staffing request
assumes there would only be one application for the gasline. If
there is more than one application, she stated, the department
would not have enough staff to aggressively pursue "expedited
action on more than one front" and would have to come back to the
Legislature to inform them there was more work involved in the
process than anticipated.
Ms. McConnell commented that the Department is already in a
"multiple pre-applicant situation" because of all the various
groups getting a "jump-start" on assessing what would be required
in order to meet state requirements. She reiterated the department
is trying to meet the current demand as well as being "proactive
with state obligations to study issues of concern that are of state
policy matter."
Senator Wilken voiced the need for the Committee to "stop and
think" about putting into place seventy-eight new employees and
committing $7 million of the "people's money." His concern is that
by December, the project might not be at the point the Department
had anticipated, and the state would have a "team with no game to
play." He urged the Committee to consider having a contingency plan
to address the possibility of delays because of "the route", or
"negotiating a position, or a myriad of other reasons" that may
present a lengthier process. He stressed that he supports the
project, but this is a "huge project to process in seven months."
Ms. McConnell clarified that the seventy-eight employees would all
be "project staff," and there is "a mechanism within the state to
hire people for the term of the project" and those people "would go
away" "if there is nothing productive for them to do."
Ms. McConnell voiced concern about the "timing with the legislative
session" and the need to assure an applicant that once the process
has started it would be supported throughout the year. She said
that this does not mean that the Department could not come back
before the Legislature and readdress some of the issues or submit
periodic updates to the Legislature in the interim.
Ms. McConnell commented that the Department feels in many respects
that the current cost projection to the state may be on the low
side when "measuring a project of this magnitude that may bring in
a couple of a hundred million dollars a year to the state." She
continued that the benefits to the state might warrant a 'higher
investment" to make sure the state "is doing it right" in all
aspects. She detailed additional items that could be addressed.
Mr. Pourchot added that the seventy-eight staffing positions would
not all come online July 1. He supported the need to develop and
staff a core office early this next fiscal year with other staff
being phased in as needed during the FY 02 fiscal year, depending
on "judgment, activity, and expectation as to when and if an
application would be forthcoming."
Senator Austerman wondered, given the end of the year timeframe the
industry has shown an interest in, if it is conceivable that
permits could be issued by the end of the year, before the
Legislature is back in session.
Mr. Pourchot replied that the permits could be applied for by the
end of the year, but it would be unlikely for a permit to be issued
by that time. He said there are a lot of different permits and the
process of bringing them all together in a consolidated permit
would increase the speed of the process, however, the department
"still feels" that the process would take eighteen months from the
time the formal application was submitted. "Eighteen months would
be fast," he noted.
Mr. Pourchot commented that the planned processing model was
utilized during the Trans-Alaska Pipeline System (TAPS) application
and construction oversight. In response to Senator Wilkens'
question, Mr. Pourchot said the state had more than seventy-five
people employed just for TAPS permitting and oversight and the
federal government had another hundred people or so. He stressed
that the process is a "major undertaking."
Senator Austerman asked whether full-time or part-time status for
"project staff" affected the "when their job is done, their job is
done" provision.
Mrs. McConnell replied that a project may last a couple of years
and staff was told when hired, that their position was for the
length of the project only. She clarified that this did not mean
that the state would end all the seventy-eight positions at the end
of FY 02 as there would still be a requirement to have some people
on board during the construction phase to monitor the permits that
were issued.
Co-Chair Kelly asked for "a best guess for turning dirt" on this
project.
Mr. Pourchot responded that the Department is hoping to "turn dirt"
within two years, although this is dependant on when an application
comes in. He continued that the outline for up-front work would
help bridge the gap between permitting time of approximately
eighteen months and the date of application, giving the "state a
jump on the required permitting time."
Co-Chair Kelly commented that two years to start-up time seems
"almost a year too early." He inquired if there was any other
structural piece that needed to be discussed in addition to the
studies, the establishing of a pipeline office, and the actual
activity that takes place once the permit had been applied for.
Mr. Pourchot replied that there is a fourth element to consider,
but it falls outside the typical reimbursement kind of activity.
This element, he stated, is the "contact and development of
Memorandums of Understanding (MOU) with other entities" such as the
federal government. He clarified that the federal government would
have an equal roll and a structure similar to the one the state is
proposing. He said the state would be doing a lot of work with the
federal agencies to set up the gasline project, similar to the
current joint oil pipeline office, and to write up Memorandums of
Understanding.
Mr. Pourchot informed that there would be a whole set of Canadian
counterparts with whom the state would work. He listed some of the
Canadian agencies that would be involved.
Mr. Pourchot anticipated there being both legal and advocacy rolls
for Alaska in Congress, and "perhaps in court" if something comes
into play that falls outside of the direct permitting work "that is
pretty vital to the process."
SFC 01 # 37, Side B 07:02 PM
Mr. Pourchot continued that there is a public process as well. He
informed that the Department has set up an advisory policy council
that has been charged with soliciting public input in a more
formalized way and to "make recommendations that are of the kind of
things that Alaskans are interested in and would benefit from the
project."
Mr. Pourchot summarized that he would group all the work associated
with these external groups into a separate category.
Co-Chair Kelly clarified that there are actually four parts to this
project if the external group category is included.
Mr. Pourchot agreed.
Ms. McConnell referred to Co-Chair Kelly's comment that the state
was anticipating the start up of the gasline project a "year too
early." She voiced concern that Alaska was actually not geared up
enough as this stage.
Ms. McConnell informed that the North American Natural Gas Pipeline
Group has developed a list of activities they believe the state
needs to do in order for efficient interaction between the state
and their group. She said the list details each state agency and an
assessment of tasks for each agency. She pointed out that these
assessments match up with the kinds of tasks that state agencies
have outlined.
Ms. McConnell validated that "yes, it may seen early" because the
state has not arrived at a decision as to what the actual
application will look like; however, from a business perspective,
this is a "very intensive time as they try to figure out what their
options are and what their best course of action is," and
ultimately whether they want to file a permit with the state.
Ms. McConnell reiterated the Department needed to be able to handle
the workload expectations of both other departments and businesses.
Senator Hoffman stressed that this is a capital project, and that
this budget request is the "best guess" by the administration for
the FY 01 supplemental and the proposed budget for FY 02, and
"could flow into" FY 03. He supported the goal of being ready as
"critical," and concurred the money to support this process would
not be "wasted."
Senator Hoffman asked whether it was the government of Canada or
the governments of British Columbia and the Yukon Territory that
were going through the same sort of budgetary discussions as
Alaska.
Mr. Pourchot informed that he had recently attended a gas
conference in Calgary and had met with officials from various
departments of the Canadian government. He recounted that
approximately five Canadian departments are actively involved in
the formulating of the policy decisions. He stated that these
departments would be "floating a policy paper" to the full cabinet
of the Canadian federal government within the next few weeks. He
informed that this paper involves routing and other things that the
Canadian agencies want to see from a gas project. Mr. Pourchot did
not think the Canadians were at the budgetary part of the process
but there was "keen interest" in the gasline project at the cabinet
level.
WILLIAM BRITT, State Pipeline Coordinator, Department of Natural
Resources, testified via teleconference from Anchorage and outlined
his Department's involvement in the gasline process as the portion
of the work that "prepares to receive an application, responds to a
request from a proponent, and puts into place actions that might be
related to state policy creation or implementation." He stated that
the "second and third areas are the ones that are becoming more and
more acute." He reported that the Department is having "more and
more interaction" with both consultants and producers groups. Mr.
Britt supported Ms. McConnell's comments about the expectations of
private industry and the fact that they would be at the doorstep of
every state agency that does authorizations for gas pipelines.
Mr. Britt referred to the private industry list of permits the
industry anticipated doing in the summer of 2001 that Ms. McConnell
had shared with the Committee. He said that permits would be issued
soon because the industry needs the permits in order to perform the
fieldwork to proceed with the gasline project.
Mr. Britt said the Department was receiving requests from the Yukon
government and the Yukon First Nation to begin coordination of the
processes and to exchange information and procedure intents. At
this point, Mr. Britt stressed, he did not have the resources to
respond to requests either from "project proponents or from other
governmental entities for coordination and consultation."
Co-Chair Kelly requested the Committee to not delve into specifics
since there was a lot of information presented and which would need
more time to be studied. He asked if there were any questions on
overall structure of the proposal.
Mrs. McConnell informed there were a few individuals available to
testify at this time who might not be available at a later time.
She asked the Committee if these people could present some
information on items that might be different in FY 02 as compared
to FY 01 and to share information on the anticipated workflow of
the departments.
Co-Chair Kelly agreed that would be valuable information and
directed that the spreadsheet that had all the departments listed
would be a good place to start the discussion.
LARRY DIETRICK, Director, Division of Spill Prevention and
Response, Department of Environmental Conservation, presented
environmental issues in brief context. He stated that the Division
was using a philosophy similar to that used when the oil pipeline
was being addressed. He stated that the state's charge at that time
was to provide certainly on the project cost estimate based on
environmental requirements. He recounted that the financial
requirement projections arrived at in 1982 for the oil pipeline
project based on a price of $26 per barrel for crude oil and 8
percent interest rates and a 90 percent design completion cost
estimate. He stressed that cost estimates and the evaluation of
environmental uncertainties were very important.
Mr. Dietrick informed that without an advanced design system and
completed project cost details resulting from rigorous planning,
design and environmental review, the ability to gain the
confidence of the financial community for necessary loans was
questionable. He stressed that lessons learned from the three
years it took to construct of the Trans Alaska Pipeline System to
when oil started to flow through the pipeline in July 1977 was
invaluable. He informed that the last review of the project
started in 1978 so experiences were "fresh" in the reviewers'
minds." He reiterated that cost overruns were a "very big
component of the planning" that went into the gasline review.
Mr. Dietrick explained that there were three key components built
into the review: a design criteria manual which includes a set of
twenty-six comprehensive environmental plans that cover everything
from construction methodologies to best management practices;
proximity of the gasline to the oil-line; and a whole permit and
authorization strategy. He stated that incorporating the
environmental planning upfront into the design and permitting
strategy would avoid permitting problems and provide a higher
certainty of cost and confidence that any environmental problems
encountered would not result in a cost overrun. He stressed that
once a three-year construction project involving 10,000 people
working the field anytime the project is shut down, it becomes a
very expensive delay.
Mr. Dietrick remarked that if plans, procedures and methods were in
place, delays caused by such things as fuel spills from leaking
joints and the avoidance of contamination from, and the disposal
of, hazardous substances would be lessened.
Mr. Dietrick detailed several other examples of preventative
planning situations, including spill containments and proper site
selection. He stressed that by anticipating these situations "up
front," project developers could have strategies for permitting,
construction procedures, disposal plans, and other necessary things
incorporated into the project costs to ensure that there would not
be cost overruns. He mentioned that Foothills Pipeline Company has
been supplied a copy of the review.
Mr. Dietrick estimated that four people would be assigned to the
spill prevention response division. He stated that these people
would be engaged in spill prevention planning and focusing on
contaminated sites. He reiterated that spill prevention, design
facilities and measures, fuel systems and secondary containment can
be built into system up front to avoid problems in clean up, spills
and slowdowns, response contingency plans and same for chemicals
and hazardous waste. He stated that these types of things are
covered in the review and that Foothills Pipeline Company has
fairly comprehensive plans in place and would be updating those
plans.
Mrs. McConnell informed that the Department of Fish and Game would
be dealing with the same kind of preliminary planning that the
Department of Environmental Conservation is doing, and unless there
were specific questions for Fish and Game, the department would not
be making a presentation at this time.
PATRICK GALVIN, Director, Governmental Coordination, shared some
concern with FY 02 issues that involved overlapping authority
between the federal and state governments. He stressed that
determining what permits are going to be needed and when they would
be needed would require detailed discussions with the project
proponents. He said that preparing for this sequencing would speed
up the process.
KELLY NICOLELLO, Assistant State Fire Marshall, Division of Fire
Prevention, Department of Public Safety, testified via
teleconference from Anchorage and informed that the FY 02 capital
budget request included the request for the Division to hire two
full time positions: one to coordinate activities and the other to
oversee building construction permits. He shared that not getting
the funding for these staffers would cause delay in processing
permits.
Mrs. McConnell informed that the nature of the work that the
Department of Transportation and Public Facilities would be doing
in FY 02 is a continuation of the FY 01 work activities.
Mr. Pourchot explained that in the Department of Natural Resources
FY 02 budget, there is need for staffers to work on projects
involving the development of mapping tools as well as the need for
other people to review permits. He informed this work would include
land titling, mapping and the identification of geological hazards
not only for the pipeline, but also for compressor stations and
hydrology work with regards to construction activities, water
resources, and archeological work that would be required for site
clearance work and construction activities.
Senator Hoffman inquired as to where the Pipeline Coordinators'
office would be located.
Mr. Pourchot responded that it is anticipated to be in Anchorage
with the existing pipeline office, although the space assessment
has yet to be done.
Senator Wilken clarified that the location of the office is
therefore still open for discussion.
Mr. Pourchot agreed that the location of the office would be open
for discussion.
General discussion ensued as to possible locations of the office.
Mrs. McConnell asked Mr. Britt to expand on any differences to the
scope of work for the pipeline office beyond the FY 01 activities.
Mr. Britt replied the differences fall into three categories:
preparing to receive an application; responding to requests from
proponents; and other actions relating to policies. He said that
most focus is on the first of these and not the second two. He
informed that the major difference in the FY 02 verses FY 01 budget
is that the Department expects to receive and process an
application. He voiced concern that the interaction with proponents
and federal and state governments is increasing, but the Department
is "not ahead of the curve but are steadily dropping behind." He
stressed that even if the Department had the money now, that he
would not be able to get the people hired in order to do the work.
He stated that recruitment is going to be challenging and would
involve a time lag. He informed that he has recently lost some
valuable staffers to private industry.
Senator Wilken asked Mr. Britt if Alaska was behind the Canadians
in this process, and if so, was it because the Canadian McKenzie
River Delta Pipeline would be built, regardless of what happens in
Alaska.
Mr. Britt said he has not talked with the Canadians recently about
that project, but anticipated resuming talks with the Canadians
within the next few months.
Mrs. McConnell informed that the Alaska Oil and Gas Conservation
Commission (AOGCC) did not have a FY 01 request, but does have a FY
02 request, however no one was available from AOGCC to testify at
this time.
Mr. Pourchot informed that one of AOGCC's area of involvement was
the study on the impacts of gas extractions from the Prudhoe Bay
oil reservoir.
KEN FREEMAN, Special Assistant for Business and Gasline
Development, Office of the Governor informed the Committee, that
$300,000 of the $535,000 FY 02 appropriation is for the
continuation of the Cambridge Contract with the remainder
designated for the Alaska Highway Natural Gas Policy Council and
its work. He informed that at an organizational meeting in March of
this year, six subcommittees were established to look at: Alaska
hire; best use of state royalty shares; federal and international
interaction that is in place or needs to be in place; access to gas
and instate consumption; other opportunities and markets for Liquid
Natural Gas (LNG); and value item processing and environmental
concerns. He informed that the goal of all six council
subcommittees is to have a final product, in written form,
th
presented to the Governor by November 30 detailing specific
recommendations on how to best maximize the benefits of the gas
pipeline for the people of the state as well as to conduct public
hearings around the state to get the public's views and
perspectives on how to best move forward with the pipeline project.
He said that two educational workshops were scheduled within the
next month with presentations detailing the various types of work
involved with the pipeline project.
Senator Hoffman asked where those meetings would be held.
Mr. Freeman responded that both meetings would be in Anchorage at
the Sheraton Hotel and that both educational workshops would be
teleconferenced statewide.
Ms. McConnell explained that the Department of Law's role in FY 02
was a position of support to the agencies and a continuation of FY
01 activities.
WILSON CONDON, Commissioner, Department of Revenue, explained that
his Department would be continuing the same activities in FY 02 as
in FY 01. He gave an overview of the FY 02 monetary breakout and
specified that the Department's current mode-of-operation is based
on established policies pertaining to the oil business. He
commented that the Legislature might want to make some adjustments
to these policies, particularly concerning the tax structure to
better maximize the public benefit.
Mr. Condon indicated that some travel might be necessary for
Department staff when working with contractors and consultants.
Mr. Condon detailed his communications with the Canadian government
concerning considerations involved in the-over-the-top route or the
highway route.
Senator Ward asked if Canada was planning on utilizing a portion of
the gas from this project to supply the people in that region?
Mr. Condon speculated that would be the case.
Senator Ward concurred that was his understanding.
Mr. Condon reviewed the agreement between the United States and
Canada in the late 1970's and early 1980's that specified that a
certain amount of gas would be supplied to Whitehorse and other
small communities along the pipeline in the Yukon Territory. He
said he would be "very surprised" if the Canadians did not ask for
that condition again in this project.
Senator Austerman asked Mr. Pourchot for a breakdown of the
projected $5.273 million in receipts from the statutory designation
program.
Mr. Pourchot replied all the receipts come from one source, the
project applicants, who pay into a fund that is segregated from the
general fund for reimbursable service agreement or a MOU with an
applicant or a sponsor program that reimburses different programs.
He said these receipts are a monthly detailing of expenses and are
"an accounting and bookkeeping system unto itself."
Senator Hoffman, referring to page 20 of the handout, asked about
the $1 million appropriation that may be requested to cover
shortfalls; specifically why it was so high given the information
that the Department was going to receive $5.2 million is Statutory
Designated Program Receipts.
Ms. McConnell responded this number was based on the assumption
that starting December first, the Department would be in a fully
reimbursable position; however, the Legislature would not be
available at that time to approve a supplemental. She stated that
if the Department needed to continue functioning until the time
that they had an application, the Department had to be sure that
they did not end up with "a couple of months hiatus" due to a lack
of funding. She continued that wherever possible, the Department
was going to seek Memorandums of Understanding with potential
applicants in advance to do some of the work, and if they are able
to negotiate for some reimbursement of expenditures prior to the
time of application, the Department is going to pursue that. She
summarized that currently, the Department is unsure that would
happen so this request, to be used only if needed, "was just to
bridge that time" until the legislature got back in session.
Senator Green referred to the first page of the handout that
specified that the information in the report included initiating
work on rights of way, permitting reviews and development, and
overall project labor agreements to provide jobs opportunities to
Alaskans. She asked where the labor agreement information was as it
is not addressed in the report.
Mr. Pourchot responded that there was an error in the drafting of
the document and clarified that the labor budget would only include
identification of laborers, training needs and performance of the
market assessment for what skills would be necessary. He stated
that a direct work product was beyond the scope of his Department's
work, and would fall under the auspice of the Department of Labor
and Workforce Development
Ms. McConnell informed that the Department of Labor and Workforce
Development is responsible for doing whatever they can to have
Alaskans hired and given the necessary training to meet the needs
of Alaska business. She reiterated that is the Department of Labor
and Workforce Development's overall mission.
Senator Green wondered if that mission was not different from a
project labor agreement.
Co-Chair Kelly supported Senator Green's observation that the
report did not include anything further on the project labor
agreement.
Senator Green asked that the reference to the Labor agreements on
the front page of the report be corrected to reflect the contents
of the report.
REMOND HENDERSON, Director of Administrative Services, Department
of Labor and Workforce Development, asked Senator Green to repeat
her question.
Senator Green referred to the first page information of the summary
regarding development of an overall project labor agreement to
provide job opportunities for Alaskans. She stated that in looking
through the Department of Labor and Workforce Development's budget
summary about the amount designated for the Department, she did not
see anything about a project labor agreement. She asked what a
project labor agreement was and if that work was being done.
Mr. Henderson replied that the funds his department had budgeted
for do not deal with a labor agreement, but concentrate on the
training aspects, research and analysis of occupational needs, and
a liaison to communities to coordinate outreach to communities and
labor organizations.
Senator Green asked for correction to the text on page one of the
Gas Pipeline Project to correctly reflect that the Labor agreement
is not included.
Co-Chair Kelly replied that this could be done.
Senator Austerman voiced support for a correction to be made.
Ms. McConnell affirmed that the Department would review the report
and make sure that the backup was correctly reflected.
Mr. Pourchot informed that he would like to bring to the
Committee's attention that over the last several years, his
Department has been able to absorb some serious budget reductions
only because of the use information technology funding coming
through federal and state capital improvement dollars, and not from
funding through the operating budget. He asserted that the
Department has concentrated on building up their system piece by
piece, and streamlining their processes.
Mr. Pourchot stressed that the Department has gotten information
into the system and available to the public and users using a web
system by using a tried and true but old system called the Land
Administration System (LAS). He expressed that the system and
software is really dated now, and he would like to address having
the system upgraded. He detailed the requested software can pull up
a section of a map of Alaska and with "pop-up's" will show such
things as right of ways and other useful reference information.
SFC 01 # 38, Side A 07:49 PM
Co-Chair Kelly interrupted to comment, for the good of the order,
that the information Mr. Pourchot was sharing was not in the backup
material, but had been covered in a previous Information Technology
report. He thanked Mr. Pourchot for his good explanation and asked
him to please continue if he wished.
Mr. Pourchot acknowledged Co-Chair Kelly comments and moved on to
review other projects.
Oil and Gas Royalties Accounting-Industry Electronics
Reporting
$150,000 General Funds
Reference No: 33974
AP/AL: Appropriation
Project Type: Planning
Category: Public Support Technology/Service
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2002
Currently the system automatically processes oil and gas
royalty reports using electronic data interface format. Each
month approximately 400 reports are filed, accompanied with
approximately 1,000 pages of supplemental documents that
explain a royalty payer's reasons for changes in royalty
filing. This project automates the delivery and processing of
the supplemental documents and would capture the information
in a standardized format.
One-time project
Mr. Pourchot explained that the Department recently installed the
same computerized billing system that oil producers and lease
holders use for the tracking of royalty information required for
state needs. He acknowledged that having the same system as private
industry has worked very well, but unfortunately, the department
still got about a thousand pages of supplemental documents along
with the royalty reports.
He explained this project is to develop a unified electronic format
that the industry and the state would use that would electronically
submit all the supplemental information along with the monthly
royalty reports. He stressed that this would "save everybody time,
effort and money."
Seismic Data Acquisition and Interpretation To Promote Oil
Exploration and Leasing
$138,000 General Funds
Reference No: 33977
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
State of Alaska statutes and regulations require oil and
exploration companies to submit geophysical data acquired from
state lands under Multiple Land Use Permits to the division.
The state is required to pay the permittees for only the cost
of reproducing the data for the state's use. Consequently, for
the division to accomplish its mission of responsibility
managing and encouraging development of the state's petroleum
resources the division must have funding to acquire
geophysical data from lands other than those owned by the
state and to provide the interpretive computer systems
utilized to support the program.
On-going project
Amendment
Mr. Pourchot informed the Committee that the Department could
benefit from the acquisition of seismic data to protect the state's
interests. He detailed that with the information this equipment
provides, the state would be in a better situation to protect their
work on federal and private land in addition to state land as well
as have the ability to protect public interest in public resources.
Emergency Title Defense-Prince William Sound
$120,000 General Funds
Reference No: 33970
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2002
Bureau of Land Management (BLM) indicates that in the next
year they will finish federal conveyances in Prince William
Sound without recognizing many thousands of acres of state-
owned tidelands that were pushed up during the 1964
earthquake. This CIP provides funds to contract for surveyors
to comprehensively determine from air photos the state lands
that were uplifted in Prince William Sound. This will provide
the state the information needed to require that BLM recognize
the state's entitlement in its conveyances. Without it,
thousands of acres in the Copper River Delta and elsewhere in
the Sound will be forever lost to the state.
One-time project
Mr. Pourchot explained that the process of land rising from the
sea, as has happened in Prince William Sound after the earthquake,
is called "evulsion." He shared that, currently under state law and
state entitlement, the state "is entitled to evuled land." He said
that currently the United States Bureau of Land Management is in
the process of conveying this land to Native corporations and
unless the state demonstrates through before and after surveys to
BLM, the state risks losing this land. He noted that the landowners
to whom the land is going to do not particularly want the land and
support the state's position. Mr. Pourchot urged that this is a
"very pressing situation as it involves substantial state ownership
and rights."
State Parks Emergency Repairs
$400,000 General Funds
Reference No: 6843
AP/AL: Appropriation
Project Type: Deferred Maintenance
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2005
On-going project
Mr. Pourchot stressed that this, unfortunately, is the most common
recurring item in Department of Natural Resources' capital budget
each year. He stressed the Department of Natural Resources'
deferred maintenance list is growing each year and could easily be
$34 million for the state park system. This request, he stated,
would address the most serious deferred maintenance projects and
emergency repairs in the park system comprised of approximately 120
units. He informed that Alaska's park system is the largest in the
nation.
Fire Truck Engine Replacements
$200,000 General Funds
Reference No: 33955
AP/AL: Appropriation
Project Type: Equipment
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2005
This project funds the continued implementation of the
Division's five-year fire engine redesign and replacement
plan. Fire engine specifications were last upgraded in 1984.
Statewide, the division responds to an average of 400 fires
per year with engines, mostly in high-risk urban interface
areas. Replacement decreases reliance on old, worn engines in
areas where life and property are at risk and is essential to
successful initial attack in population centers.
Phased project
Mr. Pourchot shared that every year the department replaces some of
its oldest equipment. He said this phase is specifically to replace
fire truck engines.
Fairbanks Office Facility Roof Maintenance and Repairs
$200,000 General Funds
Reference No: 30252
AP/AL: Appropriation
Project Type: Deferred Maintenance
Category: Health/Safety
Location: Fairbanks Areawide
Election District: Fairbanks Areawide
Estimated Project Dates: 07/01/2001 - 06/30/2003
The Department of Natural Resources office complex has a
leaking roof and other urgent repair/maintenance needs. Damage
to equipment, documents, and the work environment from the
roof leaking could occur at anytime requiring emergency
repairs, and affecting employees and the public. The emergency
power generator needs repair/maintenance to avoid winter
breakdowns and freeze-up of the facility, and the hot water
heater needs replacement.
Phased project
Mr. Pourchot reported that this is a relatively nice building but
there are tin cans all over the place because of leaks in the roof.
He informed that this is a basic roof repair job that needs to
happen.
Airborne Geological and Geophysical Mineral Inventory
$250,000 General Funds
Reference No: 6852
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2000 - 06/30/2005
This project seeks to catalyze private-sector mineral
development investment. The project delineates mineral zones
on Alaska state lands that: 1) have major economic value; 2)
can be developed in the short term to provide high quality
jobs for Alaska; 3) will provide economic diversification to
help offset the loss of Prudhoe Bay oil revenue.
On-going project
Mr. Pourchot detailed the recurring capital project of geological
surveys of approximately a thousand square miles a year. He
informed that it takes about $500,000 to do both the aerial and
ground surveys of fieldwork. He shared that once the data is
completed, it is "incredible how fast claim staking has occurred in
the wake" of the new information. He continued it has proven to be
very valuable to the mining industry and "they are most
appreciative of it." Last year, he informed, the Department
received $250,000 to fund this project, which was half of what was
needed. He urged approval of this allocation in order for the work
to be completed.
Snowmachine Trail Development and Program Grants
$200,000 General Funds
Reference No: 33690
AP/AL: Appropriation
Project Type: Health and Safety
Category: Transportation
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
Snowmobiling is one of Alaska's fastest growing outdoor
recreation activities. Funds are needed to develop and
maintain trails and trailheads to provide for safe riding
opportunities and to educate riders about safety concerns.
Funds for this program are provided by snowmobile registration
fees paid by Alaskans. They are funding this program
themselves and support a registration fee for these purposes.
Funds are distributed in the form of matching grants for trail
and trailhead development and maintenance, safety education,
and trail identification. Grants are to organizations,
businesses, agencies, governments, and individuals.
On-going project
Mr. Pourchot informed that this is general fund money. Last year,
the Legislature approved the bill pertaining to registration of
snowmachines. He specified that it was the intent of the
legislation that the fees would go toward the development of
trailhead access and other facilities for snowmachiners around the
state. He stated this would be a continuation of that program
whereby again some of that registration fee would be used for
improvements for the benefit of those who are paying those fees.
Chena Pump Road Boat Launch River Access Purchase
$101,500 General Funds
Reference No: 33979
AP/AL: Appropriation
Project Type: Construction
Category: Transportation
Location: Fairbanks Areawide
Election District: Fairbanks Areawide
Estimated Project Dates: 07/01/2001 - 06/30/2002
Direct public access to the Tanana River near Fairbanks is
limited to one site on Chena Pump Road. This site is a five-
acre Department of Transportation and Public Facilities
easement on a larger 17-acre Mental Health Land Trust (MHLT)
parcel. MHLT is seeking to develop its acreage and move the
Department of Transportation and Public Facilities easement.
Under the terms of Department of Transportation and Public
Facilities' easement, there is NO GUARANTEE for a continued
boat launch. The easement is for a highway rest area only.
Parks proposes to purchase the 17-acres from MHLT and improve
the existing boat launch, parking, and picnic facilities.
Parks' presence through its volunteer host program will
improve security at the area for vehicles left overnight.
One-time project
Amendment
Mr. Pourchot explained that this area involves the only real boat
launch and picnic area on the Tanana River. He continued that this
general fund request would allow enough money to purchase the site
from the Mental Health Lands Trust and to work with the Department
of Natural Resources to develop an upgraded recreational site.
Senator Austerman wondered if there was money available from any
other source such as from Sports Fish licenses in the Department of
Fish and Game.
Mr. Pourchot indicated that there is money available from other
sources and that is why the request is for a moderate amount. He
stated that it is a complicated title, but once the Department got
the title, then additional funds could be tapped to develop and
operate the site from other funding sources. He mentioned that
there are additional funds in the Statewide Transportation
Improvement Project (STIP) FY 03 funds.
Senator Leman clarified that the correct appraised amount for the
site is $101,500 as shown on page 52 of the report.
Senator Leman asked if the fifty percent match from the Federal
Land and Water Conservation Fund mentioned in the report was still
available once the land was purchased.
Mr. Pourchot replied yes.
Senator Austerman asked to review the dollar figures on the
snowmachine trail improvements project; specifically how much money
is raised each year from the snowmachine registration fees.
Mr. Pourchot replied that Department of Natural Resources does not
track that but the information could be obtained.
JIM STRATTON, Director, Division of Parks and Outdoor Recreation,
Department of Natural Resources, testified via teleconference from
Anchorage and stated the money that the Division of Motor Vehicles
expected to raise this year is approximately $200,000. He recapped
that the history of requests for trailhead improvements has matched
what has been raised each year from the snowmachine registration
fees.
Senator Olson asked if the snowmachine registration fee was
mandatory statewide.
Mr. Pourchot answered that the "fairly modest fee" was required at
the point of sale, statewide.
Mr. Bus informed the Committee that the remainder of the requests
are non-general fund projects.
Recorder's Office Equipment Upgrades and Records Preservation
$225,000 Receipt Services
Reference No: AMD33980
AP/AL: Appropriation
Project Type: Renewal and Replacement
Category: Public Support Technology/Service
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2002
Approximately $150.0 of this project covers the fourth phase
of a project to reinforce the infrastructure of the state's
land records system by continuing the replacement and upgrade
of various types of equipment to meet and ensure basic
operational needs at fourteen recording locations throughout
the state. Approximately $75.0 of this request will cover the
second phase of an ongoing project to film historic records.
This project consists of the filming of approximately 6,000
original books filled with historical recorded and filed
documents, dating back to the mid-1800's.
Phased project
Amendment
Mr. Bus noted that the office "generally generates greater revenues
than it expends." He spoke of the need to film the books of deeds
going back to the late 1800's and other dated material in order to
send them over to permanent storage at Archives, and outlined other
components of the request.
Alaska Minerals Information at Risk Program: Mining Claims
Automation
$700,000 Federal Receipts
Reference No: 34095
AP/AL: Appropriation
Project Type: Information Systems
Category: Public Support Technology/Service
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2003
To improve public access to public record systems, to bridge
related state and federal land record systems that have
historically been isolated, to reduce the time required to
adjudicate mining applications and update land status plats,
and to deliver internet based mapping capability.
Phased project
Mr. Bus explained that the federal government has agreed to provide
funding to automate and put online the old card system used to
track historical mining claim records.
Agriculture Revolving Loan Fund Land Assets Disposal,
$100,000 Agricultural Loan
Reference No: 34109
AP/AL: Appropriation
Project Type: Renewal and Replacement
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2003
This funding will provide for disposal of ARLF assets in
Interior and Southcentral Alaska
Phased project
Mr. Bus stated that this was the final phase of the Agriculture
Revolving Loan Fund and this activity will dispose of the last few
pieces of property held by that fund. He shared that eight parcels
in Delta and Fairbanks were successfully sold in November 2000
generating more than $1.8 million that was put back into the Loan
Fund account.
The National Fire Plan: Managing Impacts of Wildfires on
Communities and the Environment [page not provided]
$5,638,000
$3.46 million Federal Funds
$2.178 million from Kenai Borough
Reference No: 34112
Mr. Bus shared that after the recent fire season in the Lower 48,
the federal government decided to expend funds in an effort to
further prevention and conduct impact studies.
Alaska Post Entry Plant Quarantine Facility Establishment
$1.35 million Federal Receipts
Reference No: 33983
AP/AL: Appropriation
Project Type: Construction
Category: Public Support Technology/Service
Location: Palmer (Palmer)
Election District: Palmer
Estimated Project Dates: 07/01/2001 - 06/30/2006
The Alaska agriculture and horticulture industries have been
requesting the establishment of a Post Entry Quarantine
Facility for over twenty years. The desire for such a facility
is based on the simple fact that the present system has not
served the needs in Alaska. Importation of prohibited plant
species and those species with special restrictions can only
lawfully enter the United States through the present USDA
Animal and Plant Health Inspection Service (APHIS).
One-time project
Mr. Bus read from the Summary and Statement of Need the details of
the request.
Senator Hoffman, referring to backup material that stated a federal
contract would pay for the projected annual operating costs of
$800,000, asked how long that contract would be in effect.
Mr. Bus was unsure how long the federal funding would continue, but
stated that the program would operate until it stopped. He
continued that if federal funds crease, then the state would
determine what to do with the facility.
Agriculture Plant Material Center Seed Lab Construction
$3,070,000 Federal Receipts
Reference No: 33952
AP/AL: Appropriation
Project Type: Construction
Category: Development
Location: Palmer (Palmer)
Election District: Palmer
Estimated Project Dates: 08/01/2001 - 09/30/2002
The Alaska State Seed Laboratory is a section of the Alaska
Plant Materials Center (AKPMC). This is a state-owned and
operated facility within the Alaska Division of Agriculture,
Department of Natural Resources. The present State Seed
Laboratory is not capable of meeting the demands for seed
testing and technology development. The facility is
undersized, out of professional code, and under equipped to
meet present day technological requirements.
One-time project
Mr. Bus recapped the Brief Summary and Statement of Need for this
project.
Agricultural Land Sales for Agriculture Industry
$145,000 State Land
Reference No: 6887
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Mat-Su Areawide
Election District: Mat-Su Areawide
Estimated Project Dates: 07/02/2000 - 06/30/2007
The funding will provide staff and support services to sell
agricultural land in Interior and Southcentral Alaska. In
addition to supporting staff, funds will be used for survey,
appraisal, subdivision, tract rehabilitation and cleanup,
sales activities and sale follow up.
On-going project
Mr. Bus informed that this project would dispose of land with
agriculture interests.
Co-Chair Kelly asked for further explanation about the State Land
Income account.
Mr. Bus answered that this fund was set up last year and funds
generated from the sale of state lands went into this account and
would be used as an appropriation account "for future sales."
Senator Austerman referred to a reference on the handout regarding
five of six parcels that had been sold for $992,000, and asked if
that money was now in the fund to be used to fund this land sale.
He inquired if there was any "point in time" that the money in the
fund might "roll into the general fund."
Mr. Bus replied that the $992,000 was put into the Lands Fund
account and of that, $145,000 would be used toward this request. He
referred to SB 283 that specified when the fund balance reached $5
million, anything over that amount would automatically go into the
general fund.
Historic Preservation and Restoration Projects-United States
Army Public Works Program
$600,000 Federal Receipts
Reference No: 32550
AP/AL: Appropriation
Project Type: Renovation and Remodeling
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2000 - 12/30/2004
The State Office of History and Archaeology is working in
partnership with the Department of the Army on historic
preservation planning and restoration projects. Restoration
projects include the World War II National Historic Landmark
site at Fort Wainwright in Fairbanks and the National Register
of Historic Places listed Cold War Nike Site Summit In
Anchorage.
On-going project
National Historic Preservation Fund Federal Grant Program
$1,250,000
$1.2 Million Federal Receipts
$ 50,000 General Funds Match
Reference No: 6865
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 10/01/2001 - 09/30/2003
The National Historic Preservation Fund is a federal matching
grant project with a 60 percent federal and 40 percent state
match. It provides a basic historic preservation program
including planning, survey, inventory, project review, and
public education. The federal/state partnership program
created in the National Historic Preservation Act requires a
state historic preservation program to meet basic levels of
professional staffing and program services. Cooperative
agreements with federal agencies and grants from federal
programs, which do not require match, fund cultural resources
management projects.
On-going project
State Match required
Mr. Bus recapped the provisions of these requests.
Senator Austerman inquired as to when the Historic Preservation
Project was established.
Mr. Bus replied that the program has been in place for
approximately twelve years and was funded by a new federal grant
each year. He informed that the money is appropriated to a board,
and numerous communities apply to the board for funding. He said
that the Board reviews the applications and the grants are awarded
on a priority basis.
Senator Austerman asked if historically this federal grant had been
in the $1.2 million range.
Mr. Bus replied most of the grants had been in the $640,000 range;
however this coming year, the federal grant would be going up
considerably as there is more money available on the federal level
for this type of activity.
Senator Austerman inquired how the general funds match had been
operated.
Mr. Bus responded that the general fund match is in the Department
of Natural Resources operating budget.
Mental Health Trust Land Development and Value Enhancement
$950,000 Mental Health Authorized Agency Receipts (HTAAR)
Reference No: 6853
AP/AL: Appropriation
Project Type: Planning
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2000 - 06/30/2004
The Trust Land Office will contract for services related to
the enhancement of parcel-specific Trust land and resource
assets. Funds will be used to facilitate the disposal or
development of Trust resources in accordance with the Trust
Land Office's long-term asset management strategy.
On-going project
Mental Health Bill
Mr. Bus explained that this is an annual request that is directed
by the Mental Health Board of Trustees.
Abandoned Mine Lands Reclamation Federal Program
$1,500,000 Federal Receipts
Reference No: 6855
AP/AL: Appropriation
Project Type: Health and Safety
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2005
The Legislature enacted the Alaska Surface Coal Mining Control
and Reclamation Act in 1983 (AS 27.21 and 11 AAC 90). One of
the main purposes of the act was to promote the reclamation of
areas mined and left without adequate reclamation before
enactment of the federal Surface Mining Control and
Reclamation Act of 1977, that endanger the health and safety
of the public and that substantially degrade the quality of
the environment and prevent the beneficial use of or cause
damage to land and water resources.
On-going project
Mr. Bus informed that this project provides federal funds to
address hazardous abandoned mine sites. He continued that most of
the money "goes to private contractors" to remedy the situation.
Boating Safety-Federal Program
$660,000 Federal Receipts
Reference No: 32553
AP/AL: Appropriation
Project Type: Health and Safety
Category: Health/Safety
Location: Statewide
Election District: Statewide
Estimated Project Dates:07/01/2000 - 06/30/2005
The goal of the State Boating Safety Program is to reduce
preventable non-commercial boating accidents and fatalities
and promote safe, enjoyable boating in Alaska. Since 1990 an
average of 25-30 Alaskans lost their lives annually in non-
commercial boating accidents. This is more than 10 times the
national average and the highest boating fatality rate in the
nation. State boating programs are very effective at reducing
these numbers. Since 1971, recreational boating fatalities
decreased nationally by 30 percent even though the number of
recreational boats increased by 50 percent. This funding will
provide for boater education and program infrastructure.
On-going project
Mr. Bus shared that these funds allow the Department to "operate
the Boating Safety Program and to reduce the preventable, non-
commercial boating accidents" in the state.
Mr. Pourchot added that this is the money that was promised when
the Legislature passed the Boating Safety legislation that the
Department would access this funding source. He continued that this
was the first full installment of that funding.
Land and Water Conservation Fund Federal Grants
$1,600,000 Federal Receipts
Reference No: 32552
AP/AL: Appropriation
Project Type: Construction
Category: Development
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2005
Outdoor recreation opportunities are very important for
Alaskans. More than any other state in the Union, Alaskans
recreate outdoors. This provides a wide variety of benefits
including improved physical and mental health, activities for
children to prevent delinquency, leadership and teamwork
development, and economic opportunities for individuals and
local communities. LWCF is a 50/50 matching grant program that
provides funding to state and local governmental entities for
the acquisition and /or development of outdoor recreation
areas and facilities such as soccer fields, campgrounds,
tennis courts, boat launches, hiking trails, picnic areas, and
outdoor hockey rinks.
On-going project
Mr. Bus informed that this program has been available for many
years and averaged $500,000 annually until approximately 1995 when
the "funding dried up." He continued that last year, the funding
was about $900,000 and it is anticipated that this amount might
increase to approximately $5 million. Mr. Bus shared that these
grants will go to communities for local park development and other
various things. He detailed the community application process.
National Recreational Trails Federal Program
$710,000 Federal Receipts
Reference No: 6854
AP/AL: Appropriation
Project Type: Construction
Category: Transportation
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2005
All across Alaska, Alaskans rely on trails for recreation,
subsistence, and travel between communities. These trails need
constant maintenance attention to ensure they are safe for
passage and to ensure that they remain open and available for
use. Funds will be distributed in the form of 80-20 matching
grants for recreational trail and trailhead development and
maintenance, and for education programs relating to trail
safety and environmental protection. Grants are awarded to
organizations, businesses, agencies, and governments. Grant
applications are advertised statewide in the spring and awards
made to successful applicants the following February.
On-going project
Mr. Bus briefly described the program.
Forest Legacy Federal Grant Program
$500,000 Federal Receipts
Reference No: AMD34881
AP/AL: Appropriation
Project Type: Planning
Category: Natural Resources
Location: Statewide
Election District: Statewide
Estimated Project Dates: 07/01/2001 - 06/30/2006
The Forest Legacy Program provides federal funding from the
USDA Forest Service for acquisition of high-value private
forestland that is threatened with conversion to non-forest
use. In Alaska, we are concerned that private inholdings in
publicly owned forested areas that are primarily used for fish
and wildlife habitat, outdoor recreation and traditional
recreation access would be converted to non-forest use and
disrupt, destroy, or degrade these important public uses. The
primary areas where these types of conversions are probable is
in the state park system. However, the ability to use this
program to protect forested areas will not be limited to state
park lands. This program is only for willing sellers.
On-going project
Amendment
Mr. Bus briefly described the grant program.
Mr. Bus stated that this completed the Department of Natural
Resources Capital Request Budget for 2002.
Senator Green asked, regarding the Forest Legacy Federal Grant
Program, if there was a decision making process in place that
identifies the forestland properties.
Mr. Pourchot commented this is a relatively new program that is
just now being assessed by the Department.
Jim Stratton stated the Department is developing an assessment-of-
need process that is required by the federal government in order
for the state to participate in the program. He informed that
through the assessment-of-need process, the Department would be
looking at the locations of the forested areas in the state that
the Department wants to include in the program. He said the
Department would then identify the specific criteria through which
these properties would be nominated for this funding.
Co-Chair Kelly thanked the presenters for their information.
ADJOURNMENT
Co-Chair Pete Kelly adjourned the meeting at 08:20 PM
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