Legislature(2017 - 2018)SENATE FINANCE 532
05/09/2017 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB23 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 111 | TELECONFERENCED | |
| += | SB 23 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
May 9, 2017
1:16 p.m.
1:16:55 PM
CALL TO ORDER
Co-Chair MacKinnon called the Senate Finance Committee
meeting to order at 1:16 p.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Anna MacKinnon, Co-Chair
Senator Click Bishop, Vice-Chair
Senator Shelley Hughes (via teleconference)
Senator Peter Micciche
Senator Donny Olson
Senator Natasha von Imhof
MEMBERS ABSENT
None
ALSO PRESENT
Laura Cramer, Staff, Senator Anna MacKinnon
SUMMARY
SB 23 APPROP: CAPITAL BUDGET
CSSB 23(FIN) was REPORTED out of committee with a
"do pass" recommendation.
SENATE BILL NO. 23
"An Act making appropriations, including capital
appropriations, supplemental appropriations,
reappropriations, and other appropriations; making
appropriations to capitalize funds; and providing for
an effective date."
1:17:35 PM
Vice-Chair Bishop MOVED to ADOPT proposed committee
substitute for SB 23, Work Draft 30-GS1854\U (Martin,
5/8/17).
Co-Chair MacKinnon OBJECTED for discussion.
LAURA CRAMER, STAFF, SENATOR ANNA MACKINNON, explained that
the committee substitute (CS) contained a total of eight
changes, which were mostly technical. The first change was
in Section 15, page 48.
1:18:36 PM
AT EASE
1:18:49 PM
RECONVENED
Ms. Cramer noted that the former subsection (b) had been
removed. She detailed the provision would have allowed for
an appropriation to be made for a judgement or settlement
prior to June 30, 2017. The second change was in Section
23, page 52, line 2. She explained that the Alaska Housing
Finance Corporation (AHFC) dividend amount had been revised
from $6,200,000 to $6,287,000. The third change was in
Section 32, page 56, line 24. She noted there had been
confusion on the number the previous day. She referred to
Section 32(a) and explained that the first project for the
Izembek Road was not to exceed $10 million from the
original reappropriation of a balance just over $17
million. She detailed that the $10 million in Izembek funds
would be subtracted and would result in the balance of
$7,798,000 to be used for the second project found in
subsection (b). The language was meant to be clarifying and
no amounts were changed.
Ms. Cramer continued outlining changes in the CS,
highlighting a change on page 76, in Section 34. The change
accurately reflected the route for the Inter-Island Ferry
Authority. Previously it had specified the northern route;
however, the funds were for service between Ketchikan and
Prince of Wales Island. The next change was on page 78,
line 14, Section 35. The change added the dates June 30,
2018 and June 30, 2019. The sixth change was on page 78,
line 30. She elucidated that Section 35(d) had been removed
from the lapse language related to the Office of the
Governor. She elaborated that the reappropriations had
specific effective dates located in the section.
Ms. Cramer identified a change on page 79, line 2; which
was a technical correction replacing Section 32(f) with
Section 32(e) related to the Harbor Facility Grant Fund,
which did not lapse. The final change was in Section 39;
supplemental Sections 4 and 7 had been added to the
immediate effective date.
1:22:06 PM
Co-Chair MacKinnon WITHDREW her OBJECTION to the adoption
of the CS. There being NO further OBJECTION, Work Draft 30-
GS1854\U was ADOPTED.
1:22:38 PM
AT EASE
1:23:27 PM
RECONVENED
Co-Chair Hoffman MOVED to ADOPT Amendment 1, 30-GS1854\O.2
(Martin, 5/8/17) (copy on file):
Page 76, following line 5:
Insert a new bill section to read:
"*Sec. 34. HOUSE DISTRICTS 1 - 40. The sum of $37,500
is appropriated from the general fund to the
Department of Commerce, Community, and Economic
Development for payment as a grant under AS 37.05.3 16
to Arctic Winter Games Team Alaska for team
participation in the 2018 Arctic Winter Games."
Renumber the following bill sections accordingly.
Page79, line4:
Delete "3 5(d), and 36"
Insert "36(d), and 37"
Page 79, following line 18:
Insert a new subsection to read:
"(d) The appropriation made in sec. 34 of this Act is
contingent on the raising of $450,000 by Arctic Winter
Games Team Alaska for team participation in the 2018
Arctic Winter Games."
Page79, linel9:
Delete "38(c)"
Insert "39(c)"
Page79, line2l:
Delete "34 - 36, and 38(a)"
Insert "35 - 37, and 39(a)"
Page 79, line 22:
Delete "secs. 39 and 40"
Insert "secs. 40 and 41"
Co-Chair MacKinnon OBJECTED for discussion.
Co-Chair Hoffman explained that the amendment was an
appropriation to the Arctic Winter Games for $37,500. He
remarked that although the state was in financially austere
times, he believed it was important for the people of
Alaska to come together and participate in the Arctic
Winter Games International Committee. He detailed it was a
premiere cultural and athletic event in the circumpolar
world. The appropriation was for an international fee and
would demonstrate that officially the State of Alaska
recognized and supported the 2018 event on behalf of
hundreds of Alaska athletes from over 50 communities. He
clarified that it was not a direct appropriation - there
was a contingency that the international committee needed
to raise another $450,000 to enact the appropriation. He
furthered that it was more than a 10 to 1 funding match
requirement. He believed the money could be raised. He
reiterated the importance of the state's continued
participation in the unifying event.
Senator von Imhof understood that the location of the
Arctic Winter Games changed annually [biennially]. She
noted that the event had been in Fairbanks in 2014 and
Greenland in 2016. She asked for the 2018 event location.
Co-Chair Hoffman replied that the event would be held at
the Great Slave Lake region in the Northwest Territories of
Canada.
Senator von Imhof agreed that the event was a worthy cause,
but she wondered under which rubric the legislature was
deciding how to allocate funds when the 2018 event would
not be hosted in Alaska. She wondered how to compare the
event to other events being held in Alaska.
Co-Chair Hoffman considered whether Alaska would expect
another circumpolar country to make the decision based on
the criteria (mentioned by Senator von Imhof) if it was
hosting the game. He believed the answer was no. He thought
the unity the event brought to the state and the
circumpolar region outweighed the minimal appropriation
amount included in the amendment. He reiterated that it was
a match of more than 10 to 1; the appropriation would not
take place unless the match was achieved.
1:27:19 PM
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
further OBJECTION, Amendment 1 was ADOPTED.
Senator Micciche MOVED to ADOPT Amendment 2 [sponsored by
Co-Chair MacKinnon] (copy on file):
Add the following capital projects utilizing funding
from the Commercial Passenger Vessel Excise Tax
Account (Fund Code 1206).
Agency:
Department of Commerce, Community and Economic
Development
Projects:
Alaska Railroad Corporation - Seward Dock Safety
Enhancements (HD 29-31)
$1,200,000
Alaska Railroad Corporation - Seward Cruise Ship
Terminal Planning & Design
$300,000
Grants to Municipalities (AS 37.05.315)
Ketchikan - Cruise Ship Berth 4 Dock Expansion
$2,000,000
Grants to Named Recipients (AS 37.05.316)
Hoonah Dock Company - Inner Point Sophia Phase I New
Dock Mooring Buoys
$2,000,000
Hoonah Dock Company - Outer Point Sophia Dock Safety
Improvements
$500,000
Explanation:
Available funding from the CYP Tax Account totals $7.5
million. The above projects total $6 million
Co-Chair MacKinnon OBJECTED for discussion.
Senator Micciche explained that the amendment included
funding for the Commercial Passenger Vessel Excise Tax
Account meant to go toward infrastructure related to the
cruise ship industry. He stated that although in the past
not all the expenditures had been pure in that intent, all
the projects in the current request were. He requested that
he be added as a co-sponsor of the amendment.
1:28:33 PM
AT EASE
1:28:40 PM
RECONVENED
Co-Chair MacKinnon affirmed that Senator Micciche would be
added as a cosponsor. She explained that balance of the
fund was $7.5 million derived from the cruise ship head
tax. There were projects totaling $6 million in Amendment
2. The money would go towards Seward dock safety
enhancements for $1.2 million Seward cruise ship terminal
planning and design for $300,000, a Ketchikan cruise ship
berth 4 dock expansion for $2 million, the Hoonah Dock
Company Inner Point Sophia Phase I for new dock mooring
buoys for $2 million, and the Hoonah Dock Company Outer
Point Sophia Dock safety improvements for $500,000.
Senator Olson discussed the Ketchikan cruise ship berth
expansion. He wondered if it was related to an accident
that occurred when a cruise ship ran into the dock the
preceding year.
1:29:59 PM
AT EASE
1:30:15 PM
RECONVENED
Co-Chair MacKinnon did not believe that the amendment was
related to any damage incurred; the funds would go towards
a dock expansion.
Senator Olson mentioned the $1.5 million for the Alaska
Railroad Corporation for the existing Seward terminal. He
asked if the appropriation was for the railroad or to
benefit passengers paying the excise tax.
Co-Chair MacKinnon read from a prepared statement:
The Alaska cruise market is comprised of two basic
voyages - Southeast Alaska round-trip and one-way
voyages either originating or concluding in
Southcentral Alaska. Cross-gulf voyages provide
significant economic benefit to all areas of the state
and these passengers typically add land tour
components, extending their stays in Alaska. The two
ports that offer these voyages are the Port of Seward
and the Port of Whittier. These points require greater
infrastructure to accommodate the loading and
offloading of passengers, baggage, and good. The
Seward dock is aging and will need replacement. Short-
term safety improvements are necessary, but long-term
the port will need new infrastructure that can safely
and efficiently accommodate larger vessels and the
higher capacity passengers. The $300,000 is requested
to work on the design of a new dock in Seward, further
advancing the work done with the Rail Port Seward
Planning Grant.
Co-Chair MacKinnon observed that the appropriations would
benefit the tourists using the area.
Senator Olson asked why the Alaska Railroad Corporation was
named in the project.
Co-Chair MacKinnon replied that the Alaska Railroad
Corporation was the named recipient of the plan.
Vice-Chair Bishop assumed the railroad was named as the
project recipient because tourists disembarked cruise ships
and immediately boarded Alaska railroad trains for travel
to Anchorage or other locations.
Senator Olson believed that the railroad owned most of the
property in the area as well.
1:32:44 PM
Senator Micciche thought it was important for the public to
understand the designated general funds (DGF) concept. He
clarified that the appropriations in the amendment were not
coming out of general funds, the funds were DGF [note: Co-
Chair MacKinnon made a correction below that the fund
source was "other" funds, not DGF]. He elaborated that the
excise tax was collected from every passenger on a
commercial vessel (i.e. cruise ship). The tax was
established for infrastructure projects. He explained that
the last year had been a record year for visitors in the
cruise ship industry. The current year was expected to
exceed the record from the prior year. He believed the
appropriation was a wise investment for diversifying the
state's economy.
Co-Chair MacKinnon clarified that the funds were not
"designated" in terms of accounting. The funds were
considered "other" funds coming from the passenger head
tax.
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
further OBJECTION, Amendment 2 was ADOPTED.
1:34:12 PM
Vice-Chair Bishop MOVED to ADOPT Amendment 3 [sponsored by
Co-Chair MacKinnon] (copy on file):
Agency:
Department of Commerce, Community and Economic
Development Grant to Municipalities (AS 37.05.315)
Anchorage - Police Department Patrol of the Seward
Highway between Anchorage and Indian
$200,000 (General Funds 1004)
Intent Language:
It is the intent of the legislature that the
Municipality of Anchorage coordinate with the
Department of Public Safety to patrol the Seward
Highway.
Explanation:
Patrol the Seward Highway between Anchorage and Indian
Co-Chair MacKinnon OBJECTED for discussion.
Vice-Chair Bishop explained the amendment. The Department
of Commerce, Community and Economic Development Grant to
Municipalities would go to the Anchorage Police Department
patrol of the Seward Highway between Anchorage and Indian.
He read the legislative intent language [see amendment
detail above]. The appropriation was $200,000 in general
funds.
Co-Chair MacKinnon edified that Senator Cathy Giessel had
contacted her office and asked the committee to consider
adding $200,000 to the Anchorage Police Department to
provide additional public safety requirements on the Seward
Highway between Anchorage and Indian.
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
further OBJECTION, Amendment 3 was ADOPTED.
1:36:07 PM
Vice-Chair Bishop MOVED to report CSSB 23(FIN) as amended
out of Committee with individual recommendations and the
accompanying fiscal note. He asked Legislative Legal
Services and the Legislative Finance Division make any
necessary technical and conforming changes.
Co-Chair MacKinnon OBJECTED for discussion.
Co-Chair MacKinnon thanked Legislative Legal Services, the
Legislative Finance Division, the Office of Management and
Budget, and staff for their work on the legislation. She
noted that Co-Chair Hoffman had referred to the legislation
as austere. She summarized the three small amendment
appropriations including one from the cruise ship head tax,
one for public safety, and one to encourage Alaskans to
participate in athletic programs and compete globally. She
stated that the capital budget was small. The total capital
budget for FY 18 was $1.4 billion (rounded). The bill
included approximately $85 million in spend, approximately
$38 million in DGF, and approximately $77 million in other
funds. The funds leveraged almost $1.2 billion from the
federal government for highways, airports, ports, and other
significant investment across the state. Adding the
operating, supplemental, and capital supplemental budgets
raised the total spend to just over $2 billion. The budget
proposed to pay down credits owed to smaller companies and
contractors across the state. She cited a provision for
$288 million, which only addressed close to one-third of
the cashable credits owed by the state to Alaska companies.
The budget included leveraging almost $1.5 billion from the
federal government. The budget did not do everything that
every Alaskan had wished, however the committee had tried
to prioritize public safety and deferred maintenance.
Co-Chair MacKinnon WITHDREW her OBJECTION. There being NO
further OBJECTION, CSSB 23(FIN) was REPORTED out of
committee with a "do pass" recommendation.
1:39:29 PM
AT EASE
1:41:47 PM
RECONVENED
Co-Chair MacKinnon discussed the agenda for the following
day. She thanked Legislative Legal Services, the
Legislative Finance Division, and state agencies for their
collaborative work on the legislation.
ADJOURNMENT
1:43:11 PM
The meeting was adjourned at 1:43 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 23 Work Draft version U.pdf |
SFIN 5/9/2017 9:00:00 AM |
SB 23 |
| SB 23 Amendment 1 Hoffman Bishop Olson.pdf |
SFIN 5/9/2017 9:00:00 AM |
SB 23 |
| SB 23 Amendment 3 MacKinnon.pdf |
SFIN 5/9/2017 9:00:00 AM |
SB 23 |
| SB 23 Amendment 2 MacKinnon.pdf |
SFIN 5/9/2017 9:00:00 AM |
SB 23 |