Legislature(2009 - 2010)Anch LIO Conf Rm

06/29/2010 11:00 AM Senate TRANSPORTATION


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11:05:05 AM Start
11:07:04 AM Presentation on Statewide Aviation by Marc Luiken, Deputy Commissioner, Aviation Division
12:55:59 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Aviation Overview
Presentation on Statewide Aviation by
Marc Luiken, Deputy Commissioner,
Aviation Division
<Teleconference Listen Only>
                    ALASKA STATE LEGISLATURE                                                                                  
            SENATE TRANSPORTATION STANDING COMMITTEE                                                                          
                         June 29, 2010                                                                                          
                           11:05 a.m.                                                                                           
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Senator Linda Menard, Vice Chair                                                                                                
Senator Bettye Davis                                                                                                            
Senator Kevin Meyer                                                                                                             
Senator Joe Paskvan, via teleconference                                                                                         
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                              
Senator Albert Kookesh, Chair                                                                                                   
                                                                                                                                
OTHER LEGISLATORS PRESENT                                                                                                     
                                                                                                                                
Representative Peggy Wilson, via teleconference                                                                                 
Representative Jay Ramras                                                                                                       
Representative Craig Johnson                                                                                                    
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
PRESENTATION ON STATEWIDE AVIATION BY MARC LUIKEN~ DEPUTY                                                                       
COMMISSIONER~ AVIATION DIVISION                                                                                                 
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
No previous action to record                                                                                                    
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
LEO VON SCHEBEN, Commissioner                                                                                                   
Department of Transportation and Public Facilities (DOTPF)                                                                      
Anchorage, AK                                                                                                                   
POSITION STATEMENT:  Introduced the new deputy commissioner of                                                                
aviation.                                                                                                                       
                                                                                                                                
MARC LUIKEN, Deputy Commissioner                                                                                                
Aviation                                                                                                                        
Department of Transportation and Public Facilities (DOTPF)                                                                      
Anchorage, AK                                                                                                                   
POSITION STATEMENT:  Provided a statewide aviation update.                                                                    
                                                                                                                                
JOHN PARROTT, Manager                                                                                                           
Ted Stevens Anchorage International Airport                                                                                     
Anchorage, AK                                                                                                                   
POSITION  STATEMENT:   Answered questions  fuel-related questions                                                             
related to the Ted Stevens Anchorage International Airport.                                                                     
                                                                                                                                
FRANK RICHARDS, Deputy Commissioner                                                                                             
Highways and Public Facilities                                                                                                  
Department of Transportation and Public Facilities (DOTPF)                                                                      
Anchorage, AK                                                                                                                   
POSITION STATEMENT:   Answered questions related  to highways and                                                             
funding.                                                                                                                        
                                                                                                                                
VERNE RUPRIGHT, Mayor                                                                                                           
Wasilla, AK                                                                                                                     
POSITION  STATEMENT:    Testified  to the  need  to  connect  the                                                             
Wasilla airport with the FEMA center.                                                                                           
                                                                                                                                
JOE GRIFFITH, General Manager                                                                                                   
Matanuska Electric                                                                                                              
POSITION  STATEMENT:   Provided  information  on the  BuildAPlane                                                             
project in Talkeetna.                                                                                                           
                                                                                                                                
CHERYL HEINZE, Community Affairs                                                                                                
Matanuska Electric Association                                                                                                  
POSITION STATEMENT:   Described  the BuildAPlane program  and the                                                             
project in Talkeetna.                                                                                                           
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
11:05:05 AM                                                                                                                   
VICE-CHAIR   LINDA  MENARD   called  the   Senate  Transportation                                                             
Standing Committee  meeting to  order at 11:05  a.m.   Present at                                                               
the  call to  order were  Senators Kevin  Meyer, Joe  Paskvan via                                                               
teleconference,   and    Linda   Menard.   Also    present   were                                                               
Representatives Peggy Wilson via  teleconference, Jay Ramras, and                                                               
Craig Johnson. Senator Bettye Davis  and Senator Meyer joined the                                                               
committee as the meeting was in progress.                                                                                       
                                                                                                                                
   ^Presentation on Statewide Aviation by Marc Luiken, Deputy                                                               
                Commissioner, Aviation Division                                                                             
                                                                                                                              
VICE-CHAIR MENARD  said the business  before the committee  is an                                                               
overview of aviation by the  new deputy commissioner of aviation,                                                               
Marc Luiken.                                                                                                                    
                                                                                                                                
11:07:04 AM                                                                                                                   
LEO VON  SCHEBEN, Commissioner, Department of  Transportation and                                                               
Public  Facilities (DOTPF),  introduced Deputy  Commissioner Marc                                                               
Luiken and  highlighted his distinguished  29 year career  in the                                                               
Air  Force.  A full  copy  of  his resume  may  be  found in  the                                                               
committee file. He  described Mr. Luiken as a pilot  who also has                                                               
strong technical ties to aviation.                                                                                              
                                                                                                                                
11:11:08 AM                                                                                                                   
MARC  LUIKEN,  Deputy  Commissioner of  Aviation,  Department  of                                                               
Transportation and  Public Facilities (DOTPF), said  he's pleased                                                               
to work with the dedicated group  in what is the largest aviation                                                               
system  in  North America.  Aviation  is  very important  to  the                                                               
people in this state and the  economy. He related that this brief                                                               
will provide updates on the  Alaska International Airport System,                                                               
the statewide  aviation system, and  what he intends to  focus on                                                               
as the deputy commissioner of aviation.                                                                                         
                                                                                                                                
He described the  Alaska International Airport System  as the air                                                               
freight gateway for trade and  commerce between North America and                                                               
Asia. He noted  that about five percent of the  value of all U.S.                                                               
international  cargo passed  through  Anchorage  in 2008.  That's                                                               
equivalent  to about  $41 billion  in merchandise.  International                                                               
freight lines refuel in Anchorage  in order to maximize the cargo                                                               
transiting between Asia  and North America. He  displayed a chart                                                               
showing that  the combined cargo  and passenger  landing accounts                                                               
have  almost reached  pre-recession  levels. Of  further note  is                                                               
that the  certified maximum gross  take-off weight  is equivalent                                                               
to the 2006 level.                                                                                                              
                                                                                                                                
A challenging  issue is to be  able to provide assurance  of fuel                                                               
availability.  Currently  there is  a  shortage  of reliable  and                                                               
stable fuel,  which has  resulted in about  25 aircraft  per week                                                               
overflying   Anchorage.  The   recession   caused   one  of   the                                                               
significant discrete  production units to  be taken off  line and                                                               
recovering demand  hasn't justified sustained production  at pre-                                                               
recession  levels.  This may  continue  for  some time  to  come.                                                               
Interim  measures  that are  being  pursued  include bringing  up                                                               
Tower 3 at Flint Hills.  Production started again this summer and                                                               
the  Alaska Railroad  is currently  moving about  700,000 gallons                                                               
per  day to  support the  operations in  Anchorage. He  expressed                                                               
intent  to continue  to work  with fuel  suppliers and  buyers to                                                               
ensure adequate supplies through the winter.                                                                                    
                                                                                                                                
SENATOR PASKVAN  said he understands  that that a  consortium has                                                               
been formed in  Anchorage to address the jet  fuel shortfalls and                                                               
he'd like to hear what they've been able to achieve.                                                                            
                                                                                                                                
MR. LUIKEN deferred to John Parrott.                                                                                            
                                                                                                                                
11:15:17 AM                                                                                                                   
JOHN  PARROTT,  Manager,   Ted  Stevens  Anchorage  International                                                               
Airport, informed  the committee that the  fuel consortium, which                                                               
has  existed for  a  number  of years,  manages  the storage  and                                                               
piping of  fuel for the  consortium members. It does  not control                                                               
fuel; it  stores fuel  that is under  contract by  the individual                                                               
carriers.  It  stores  about  20  million  gallons  at  Anchorage                                                               
International and the  same amount at the Port  of Anchorage. The                                                               
consortium  is also  responsible for  the hydrant  system at  the                                                               
airport.  He said  the  fuel shortage  first  became apparent  in                                                               
November and since  then he's been working  to educate suppliers,                                                               
transporters, and users about what can be done                                                                                  
                                                                                                                                
SENATOR PASKVAN  mentioned the over  flights due to the  jet fuel                                                               
shortage and asked  what pricing mechanism may  be inhibiting the                                                               
full utilization  of Alaska's petroleum  resources as  opposed to                                                               
importing,  and what  control the  jet fuel  consortium plays  in                                                               
that process.                                                                                                                   
                                                                                                                                
MR.  PARROTT clarified  that  the consortium  has  no control  or                                                               
input  on the  price of  fuel.  The consortium  neither buys  nor                                                               
sells fuel,  but it  does pay  a fee  for storage.  What happened                                                               
with Tower  3 at Flint  Hills was a  demand issue, not  a pricing                                                               
issue. At  the end  of 2008  and 2009 the  annual demand  for the                                                               
Alaska International  Airport System  dropped about  $300 million                                                               
gallons  per  year,  which  is  about  equal  to  the  production                                                               
capacity of  Tower 3. It  is now back  on line and  producing and                                                               
Flint  Hills plans  to continue  to run  it as  long as  there is                                                               
adequate demand  or until the  weather turns cold. At  that point                                                               
there  are  technical  problems   associated  with  operating  at                                                               
reduced capacity  through the low-demand cold  months or shutting                                                               
it  down in  mid cold  season. Flint  Hills is  looking at  these                                                               
issues  and  at the  same  time  some  companies are  looking  at                                                               
contingency  plans to  bring  in tanker  fuel.  This doesn't  use                                                               
Alaska resources but  could conceivably meet the need  of the air                                                               
carriers.                                                                                                                       
                                                                                                                                
11:21:41 AM                                                                                                                   
MR. LUIKEN displayed  a slide to show  that construction activity                                                               
is  nearly complete  at Anchorage  and Fairbanks.  The new  south                                                               
terminal and connector  between the north and  south terminals in                                                               
Anchorage  and  the new  terminal  and  runway in  Fairbanks  are                                                               
complete and  have been in  use for  about a year.  Both airports                                                               
now have  the capacity to  handle the largest aircraft  in world.                                                               
He noted  that the  gate and the  access control  improvements at                                                               
Fairbanks are  both American  Restoration Recovery  Act projects.                                                               
Additional work includes  runway work at Anchorage  and repair to                                                               
the fire response facility at Fairbanks.                                                                                        
                                                                                                                                
MR. LUIKEN highlighted  marketing as an issue that's  on his mind                                                               
and noted  that cargo is  one of  biggest revenue drivers  in the                                                               
system.  They're  working to  expand  that  as they  continue  to                                                               
develop the  air-cargo infrastructure. To  that end they  have an                                                               
air cargo summit planned in  August to discuss the cargo transfer                                                               
advantages that Alaska law provides to carriers.                                                                                
                                                                                                                                
11:24:15 AM                                                                                                                   
CHAIR MENARD asked if their marketing budget is adequate.                                                                       
                                                                                                                                
MR.  LUIKEN  answered  yes;  the  airports see  this  as  a  good                                                               
investment.                                                                                                                     
                                                                                                                                
REPRESENTATIVE P. WILSON noted that  before he arrived on the job                                                               
there was concern about the use  of office space at the Anchorage                                                               
airport and asked if that had been addressed.                                                                                   
                                                                                                                                
MR. LUIKEN replied there is plenty  of space for employees at the                                                               
Anchorage airport.                                                                                                              
                                                                                                                                
REPRESENTATIVE P. WILSON  said the issue was that  too much space                                                               
was  being   used  for  employees  and   therefore  space  wasn't                                                               
available to rent and produce income.                                                                                           
                                                                                                                                
SENATOR DAVIS joined the committee.                                                                                             
                                                                                                                                
11:26:47 AM                                                                                                                   
MR. LUIKEN said  the airport leadership is working  to bring back                                                               
a  marketing  team   and  is  working  with   the  Department  of                                                               
Administration to properly classify the  positions so they can be                                                               
filled.                                                                                                                         
                                                                                                                                
MR.  LUIKEN  directed  attention   to  the  handout  he  provided                                                               
detailing  the   various  construction  projects  at   the  rural                                                               
airports statewide.  He assured  the committee  that many  of the                                                               
safety  and regulatory  needs throughout  the statewide  aviation                                                               
system  have been  addressed  and  those will  continue  to be  a                                                               
priority. He highlighted  that Bethel - the  second busiest cargo                                                               
airport in  Alaska - has a  new runway and a  new airport manager                                                               
who  oversees  the  Bethel  airport   and  27  smaller  community                                                               
airports  in the  region. He  displayed a  slide to  show similar                                                               
successes in Southeast  and noted that at this time  there are no                                                               
current construction needs in Southeast.                                                                                        
                                                                                                                                
Upcoming construction  challenges include airports in  the Yukon-                                                               
Kuskoquim Delta,  the Aleutian Chain, and  Akutan. These projects                                                               
will  be more  expensive because  of material  availability, soil                                                               
conditions, and  access. Thus,  he is looking  at ways  to foster                                                               
economic  development, particularly  in smaller  communities that                                                               
are experiencing  some growth.  Right now  there is  potential in                                                               
Hooper Bay, Savoonga, and Talkeetna.  He said he'll be looking to                                                               
the state and  other sources for funding  opportunities for these                                                               
projects  and  he  noted  that there  are  indications  that  the                                                               
federal government will  expect the state to  contribute a larger                                                               
share of the match.                                                                                                             
                                                                                                                                
11:31:36 AM                                                                                                                   
MR. LUIKEN displayed  a list of the areas he  intends to focus on                                                               
in   the  next   few  months.   First,  he   will  continue   his                                                               
predecessor's  priority, which  was  to focus  on Alaska's  rural                                                               
airports. He  will work  with the  commissioner and  the regional                                                               
directors to ensure that maintenance  and operations projects are                                                               
adequately  funded.  The goal  is  to  be  good stewards  of  the                                                               
capital  improvements that  have already  been made.  He said  he                                                               
also intends  to look at  the prioritization process in  order to                                                               
continue to focus on the airports with the greatest needs.                                                                      
                                                                                                                                
One  of the  greatest  challenges to  the project  prioritization                                                               
process is  the FAA mandates.  They define requirements  for most                                                               
of the airports  in Alaska including many of  the rural airports.                                                               
For example, about $230 million  of the airport incentive program                                                               
(AIP) funding over the last five  years have been spent on runway                                                               
safety  areas  around the  state.  The  most recent  FAA  mandate                                                               
relates to  pavement condition so they'll  probably spend between                                                               
$40 million  and $50 million of  the AIP funding on  pavements in                                                               
FY11.                                                                                                                           
                                                                                                                                
Another example of how they're  interacting with federal agencies                                                               
is the  100 low-lead aviation  fuel issue. They're involved  in a                                                               
joint  departmental  effort responding  to  a  proposed EPA  rule                                                               
change that  could significantly impact Alaska's  economy and way                                                               
of life.  His goal is  to work with  these agencies to  provide a                                                               
common-sense  approach  in  dealing  with  Alaska's  airports  to                                                               
continue to improve aviation safety.                                                                                            
                                                                                                                                
He  said  he   also  intends  to  focus   on  communication  both                                                               
internally and  externally. He  said he's  already met  with many                                                               
key  stakeholders  including the  FAA,  the  Alaska Air  Carriers                                                               
Association, the Alaska Airports  Association, Lake Hood Advisory                                                               
Group, and others. One of the  handouts he provided is a brochure                                                               
that tells  the Alaska  aviation story. The  intention is  to get                                                               
this  message  to  the  funding   decision-makers  so  that  they                                                               
understand what aviation means to  communities in the rural areas                                                               
of the state.                                                                                                                   
                                                                                                                                
11:35:17 AM                                                                                                                   
CHAIR  MENARD asked  if he'd  gone  to Washington  D.C. to  speak                                                               
directly to the decision makers.                                                                                                
                                                                                                                                
MR.  LUIKEN said  he's looking  forward to  that opportunity.  He                                                               
said  they'll  continue  to  update  their  website  and  provide                                                               
details on projects  and the aviation system plan.  He noted that                                                               
plan was last updated in 1996  and they're two years into the new                                                               
program.  Updates   on  that  will  be   forthcoming  as  they're                                                               
available.                                                                                                                      
                                                                                                                                
He  displayed a  slide  to  demonstrate that  82  percent of  the                                                               
state's communities are not on  the road system and are therefore                                                               
very  dependent on  aviation for  basic  needs. This  is a  large                                                               
area.                                                                                                                           
                                                                                                                                
11:38:50 AM                                                                                                                   
CHAIR MENARD  asked if he  feels that a  lot of the  FAA mandates                                                               
are not applicable to Alaska.                                                                                                   
                                                                                                                                
MR.  LUIKEN replied  that's probably  true, but  we have  to work                                                               
with the FAA on each mandate to see if it makes sense.                                                                          
                                                                                                                                
CHAIR MENARD  asked if the  operation and maintenance on  the 230                                                               
[255] state-operated airports is adequate.                                                                                      
                                                                                                                                
MR. LUIKEN said he believes that  one of biggest challenges is to                                                               
allocate funds  to maintain the  runways at a level  that ensures                                                               
the margin of safety that air pilots expect.                                                                                    
                                                                                                                                
CHAIR  MENARD   asked  if  he's   comfortable  that   the  Alaska                                                               
congressional delegation is doing what it can.                                                                                  
                                                                                                                                
MR. LUIKEN replied he will continue to work with them.                                                                          
                                                                                                                                
SENATOR MEYER joined the meeting.                                                                                               
                                                                                                                                
11:40:29 AM                                                                                                                   
REPRESENTATIVE  CRAIG  JOHNSON, noting  that  Alaska  has a  very                                                               
large and unique  aviation population, asked if he  has looked at                                                               
the relationship between private and commercial pilots.                                                                         
                                                                                                                                
MR. LUIKEN replied he's flown  around the Anchorage bowl and he's                                                               
met with  Lake Hood  advisory council, but  he hasn't  gotten in-                                                               
depth  feedback   from  the   general  aviation   community.  His                                                               
perspective is they've  done a good job working with  the FAA and                                                               
the airports to keep aircraft well separated.                                                                                   
                                                                                                                                
REPRESENTATIVE  JOHNSON encouraged  him  reach out  and open  the                                                               
lines of communication earlier rather  than later with the pilots                                                               
association  because  they  typically won't  say  anything  until                                                               
there's a problem.                                                                                                              
                                                                                                                                
11:43:51 AM                                                                                                                   
MR. LUIKEN said  he's talked with Tom George  from AOPA [Aircraft                                                               
Owners and  Pilots Association]  and Dee  Hanson from  the Alaska                                                               
Airmen's  Association, but  he will  make it  a priority  to meet                                                               
with others.                                                                                                                    
                                                                                                                                
CHAIR  MENARD asked  about  his marketing  plans  to encourage  a                                                               
cargo hub in Anchorage.                                                                                                         
                                                                                                                                
MR. LUIKEN replied they've been  working with the U.S. Department                                                               
of  Transportation to  help interpret  the  transfer right  rules                                                               
that apply  to Alaska  that are  different from  the rest  of the                                                               
U.S.  They  hope that  cargo  carriers  will recognize  the  huge                                                               
potential  here  in  Alaska. Recently  they  heard  that  several                                                               
foreign  international  carriers  didn't  understand  what  these                                                               
rules meant to them.                                                                                                            
                                                                                                                                
CHAIR MENARD suggested he develop  a short video that legislators                                                               
could distribute.                                                                                                               
                                                                                                                                
REPRESENTATIVE JOHNSON asked if there  are any state laws or duty                                                               
free areas relating to cargo  transfer that the Legislature could                                                               
address to make Alaska's airports more attractive.                                                                              
                                                                                                                                
11:47:11 AM                                                                                                                   
MR.  LUIKEN said  he doesn't  have an  answer, but  he'll do  the                                                               
research.                                                                                                                       
                                                                                                                                
SENATOR PASKVAN asked if the 25  over flights per week are due to                                                               
the jet  fuel shortage, if  it's possible  to get them  back, and                                                               
what volume they represent.                                                                                                     
                                                                                                                                
MR. LUIKEN surmised  that at least a portion of  the over flights                                                               
are due to perceived fuel availability  so part of his task is to                                                               
get the word out that fuel is available in Alaska.                                                                              
                                                                                                                                
SENATOR PASKVAN asked if the imported jet fuel is cheaper.                                                                      
                                                                                                                                
MR.  LUIKEN replied  he  doesn't  know but  he  assumes it's  not                                                               
cheaper because there is a cost associated to bring it in.                                                                      
                                                                                                                                
SENATOR  PASKVAN  referred  to  his earlier  statement  that  the                                                               
certified maximum  gross take-off weight was  again equivalent to                                                               
the 2006  level and asked  if we could  expect to reach  the 2008                                                               
peak.                                                                                                                           
                                                                                                                                
MR. LUIKEN replied that will be dependent on the larger economy.                                                                
                                                                                                                                
SENATOR PASKVAN asked how far below the peak they are currently.                                                                
                                                                                                                                
MR. LUIKEN deferred to Mr. Parrott.                                                                                             
                                                                                                                                
11:50:12 AM                                                                                                                   
MR. PARROTT replied they're up  to the November 2009 level, which                                                               
is  when they  reached a  limit  they couldn't  go above  without                                                               
getting some production from Tower  3. That tower has been turned                                                               
on and  is producing  product so  they're in  good shape  for the                                                               
next couple of months, but that  doesn't help an air carrier that                                                               
wants a plan  through the winter and into next  summer. It's that                                                               
winter period  that they're concerned  about when  the production                                                               
decreases more than the demand.                                                                                                 
                                                                                                                                
Responding  to Senator  Paskvan's previous  question, he  related                                                               
that the carriers have said that  most of 25 over flights are due                                                               
to  fuel.  Because  of the  payload/range  equation,  they  fully                                                               
recognize that it's worthwhile to  stop in Alaska and they've all                                                               
expressed  a desire  to get  those flights  back into  Alaska. We                                                               
want to  help resolve  this problem while  they have  that desire                                                               
and before they change their operations, he said.                                                                               
                                                                                                                                
SENATOR PASKVAN asked what percentage  or volume the imported jet                                                               
fuel represents  relative to the  Flint Hill Tower 3  capacity to                                                               
produce. He  said that gets  back to his original  question about                                                               
whether the imported jet fuel is  cheaper for these 25 flights or                                                               
if instate is cheaper but there isn't enough demand.                                                                            
                                                                                                                                
MR. PARROTT said one of the  problems is that the airport doesn't                                                               
have  information  about the  price  of  fuel. The  carriers  and                                                               
producers set  their contracts  and determine  the price  of fuel                                                               
and  that   information  is  closely   guarded  because   it's  a                                                               
competitive advantage of one airline over another.                                                                              
                                                                                                                                
11:53:21 AM                                                                                                                   
SENATOR  PASKVAN said  that  would  be a  relevant  issue if  the                                                               
Legislature were  to fund  storage capacity.  He added  that he's                                                               
trying  to   determine  what   needs  to   be  done   to  sustain                                                               
availability of instate produced jet fuel.                                                                                      
                                                                                                                                
MR. PARROTT acknowledged  that is a legitimate  concern. He noted                                                               
that  during the  peak  days  of 2007  they  were maximizing  the                                                               
instate  production  capability.  To   go  above  that  threshold                                                               
additional storage  capability will  be necessary to  handle out-                                                               
of-state  product. Right  now if  there  were additional  storage                                                               
capacity there  would be an  economic battle.  Furthermore, Flint                                                               
Hills  has  some  physics  issues   that  are  making  life  more                                                               
difficult, he said.                                                                                                             
                                                                                                                                
REPRESENTATIVE JOHNSON asked what impact the 777 will have.                                                                     
                                                                                                                                
MR. PARROTT replied the 777  has the capability to overfly Alaska                                                               
and  depending on  the business  model  of the  carrier it  could                                                               
"volume out" before it "weights out"  and overfly. But if the 777                                                               
reaches the maximum total weight  it cannot overfly Alaska and go                                                               
to cities  in the  Lower 48  without stopping.  In large  part it                                                               
depends on  what the craft  is carrying as  to whether or  not it                                                               
can overfly.  The current  Fed Ex business  model allows  them to                                                               
overfly when they're  eastbound. This gives them  an advantage of                                                               
being able  to stay on  the ground in Asia  a few more  hours and                                                               
then  fly directly  to Memphis.  On the  westbound flight  flying                                                               
empty and  into a headwind, the  777 often stops in  Anchorage to                                                               
change crews. He summarized that  the 777 changes the situation a                                                               
little,  but  it's  not  a   drastic  and  immediate  impact.  He                                                               
anticipates seeing more 777s as they carry heavier weights.                                                                     
                                                                                                                                
11:57:16 AM                                                                                                                   
FRANK    RICHARDS,    Deputy    Commissioner,    Department    of                                                               
Transportation  and Public  Facilities  (DOTPF), said  he has  no                                                               
prepared remarks but he's available to answer questions.                                                                        
                                                                                                                                
CHAIR MENARD asked how things are going from his perspective.                                                                   
                                                                                                                                
MR. RICHARDS related  that it's been a challenging  year with the                                                               
stimulus money  that came to  the state for aviation  and highway                                                               
and  transit, but  he's  pleased to  report  that the  department                                                               
responded in kind and put that  money to work. They have projects                                                               
ranging from Ketchikan  to Kotzebue to Anchorage  and the results                                                               
are being seen. What he finds  most beneficial is that the public                                                               
is calling  with positive  comments. Projects  that have  been or                                                               
are close to completion include:  the Minnesota paving project in                                                               
Anchorage;  the Glen  Highway paving  from downtown  Anchorage to                                                               
downtown  Palmer; paving  from  Big Lake  to  Anchorage; and  the                                                               
Front Street work in Kotzebue.                                                                                                  
                                                                                                                                
This  year  the  state  received about  $130  million  additional                                                               
Federal  Highway Program  funds to  use for  projects within  the                                                               
STIP. That  combined with the  additional $276 million  from last                                                               
year represents nearly  $400 million that the state  will have to                                                               
put   to  use   to  address   transportation  issues   statewide.                                                               
Department staff has  worked hard to meet  the associated federal                                                               
obligations, but  the money has been  put to good use  and Alaska                                                               
will see  the benefits  of those projects  over the  next several                                                               
years.                                                                                                                          
                                                                                                                                
12:01:07 PM                                                                                                                   
SENATOR MEYER  asked for updates on  the Knik Arm Bridge  and the                                                               
safety improvements  on the Seward Highway,  particularly between                                                               
Potters Marsh and Portage Glacier.                                                                                              
                                                                                                                                
MR.  RICHARDS  explained that  the  Seward  Highway from  Potters                                                               
Marsh  to south  of Girdwood  is one  of four  designated highway                                                               
safety  corridors  in the  state.  The  enabling legislation  for                                                               
these   safety   corridors    provided   money   for   education,                                                               
enforcement,   and  engineering.   Education  includes   improved                                                               
signage, an  advertizing campaign to improve  driving safety, and                                                               
providing information  to kids in  schools so they  can influence                                                               
their parents. Enforcement - the  Bureau of Highway Patrol within                                                               
DPS has  new enforcement  officers and  patrol vehicles  that are                                                               
patrolling  that section  of the  Seward Highway.  Engineering to                                                               
design near-term  projects that  can be put  in place  while they                                                               
plan, program, and  acquire money for the other  projects in that                                                               
windy corridor on the Seward Highway.                                                                                           
                                                                                                                                
The long-term  goal on  these safety corridors  is to  expand the                                                               
highways from two  lanes to four lanes, which  will be expensive.                                                               
The estimate for the Seward Highway  is in excess of $600 million                                                               
and that money isn't currently available.                                                                                       
                                                                                                                                
12:05:49 PM                                                                                                                   
MR.  RICHARDS related  that the  Federal Highways  Administration                                                               
asked  KABATA  [the  Knik  Arm  Bridge  and  Toll  Authority]  to                                                               
complete a  biological assessment of  the beluga whale  under the                                                               
Endangered Species  Act (ESA). That completed  assessment will be                                                               
given to the U.S. Fish and  Wildlife Service and then that agency                                                               
has to work with the ESA  and the Marine Mammal Protection Act to                                                               
come up  with a biological opinion  on the impacts of  the bridge                                                               
on  the beluga  whale  and  the critical  habitat  in Upper  Cook                                                               
Inlet.  These  formal  processes  must  be  complete  before  the                                                               
Federal Highways  Administration will issue a  record of decision                                                               
for the  project. He  noted that  he will  go to  Washington D.C.                                                               
with the  executive director of  KABATA to help  answer questions                                                               
that the fish and wildlife may have.                                                                                            
                                                                                                                                
12:08:41 PM                                                                                                                   
CHAIR MENARD  expressed optimism that  the bridge would  be built                                                               
by 2015.                                                                                                                        
                                                                                                                                
SENATOR PASKVAN questioned where Alaska  would be now without the                                                               
federal stimulus dollars for projects.                                                                                          
                                                                                                                                
MR.  RICHARDS said  Alaska receives  about $400  million annually                                                               
from the  Federal Highway Administration  to address  highway and                                                               
road projects.  Although the SAFETEA-LU authorization  expired in                                                               
September 2009,  the state has  continued to receive  these funds                                                               
through continuing resolutions.                                                                                                 
                                                                                                                                
SENATOR  PASKVAN  said  he  is  specifically  interested  in  the                                                               
stimulus dollars.                                                                                                               
                                                                                                                                
MR. RICHARDS said the stimulus  dollars were above and beyond the                                                               
regular program dollars and were  of great help in addressing the                                                               
backlog of projects  statewide. They were icing on  the cake, but                                                               
the state  still has  billions of  dollars in  needs in  both the                                                               
rural and urban systems.                                                                                                        
                                                                                                                                
SENATOR PASKVAN asked how many  stimulus dollars are at work this                                                               
construction season.                                                                                                            
                                                                                                                                
12:12:50 PM                                                                                                                   
MR.  RICHARDS  replied  they  received  about  $275  million  for                                                               
airports, highways and transit.                                                                                                 
                                                                                                                                
REPRESENTATIVE  PEGGY WILSON  asked  if projects  that have  been                                                               
waiting a long time will be addressed or just STIP projects.                                                                    
                                                                                                                                
MR. RICHARDS said  the stimulus money has  advanced projects that                                                               
have been  waiting in  the STIP.  He clarified  that part  of the                                                               
Title 23  requirements is  that a  project that  is going  to use                                                               
federal highway  dollars must  be part  of the  STIP and  it must                                                               
have been  developed using federal highway  procedures. These are                                                               
the  environmental  procedures, the  right-of-way  certification,                                                               
and the  design processes. Projects  that would have  been funded                                                               
in 2011 or  2012 have been moved  up to 2009 and  2010, which has                                                               
helped to get more work done than originally planned.                                                                           
                                                                                                                                
REPRESENTATIVE P.  WILSON asked if  the stimulus money has  to be                                                               
used for STIP projects.                                                                                                         
                                                                                                                                
MR. RICHARDS  answered yes;  the money  came through  the Federal                                                               
Highway  Administration  so DOTPF  had  to  follow the  Title  23                                                               
requirements.                                                                                                                   
                                                                                                                                
REPRESENTATIVE  P  WILSON  asked  how  many  totally-state-funded                                                               
projects were completed  as a result of  receiving stimulus funds                                                               
for other projects.                                                                                                             
                                                                                                                                
12:16:13 PM                                                                                                                   
MR. RICHARDS  answered they were  able to advance between  15 and                                                               
20 highway-related projects with the  stimulus funds that came to                                                               
Alaska.                                                                                                                         
                                                                                                                                
REPRESENTATIVE P WILSON said she'd follow up later.                                                                             
                                                                                                                                
VERNE  RUPRIGHT, Mayor  of Wasilla,  informed the  committee that                                                               
the  Menard Sports  Arena is  the FEMA  area. He  highlighted the                                                               
need for  just nine tenths of  a mile of roadway  that is related                                                               
to the following:                                                                                                               
   · Connectivity to the airport for supply/resupply and air                                                                    
     evacuation to the FEMA center in event of emergency.                                                                       
   · Economic development near the FEMA center.                                                                                 
  · Relocation of the railroad station from downtown Wasilla.                                                                   
   · Lengthening of the Wasilla airport runway to 4,400 feet and                                                                
     upgrading the navigation system to provide for commercial                                                                  
     traffic.                                                                                                                   
                                                                                                                                
MAYOR RUPRIGHT  emphasized the need  to take care of  citizens in                                                               
an   emergency  as   well  as   the  increasing   air  and   road                                                               
transportation  needs in  the local  area because  the population                                                               
surge  is  going to  the  Mat-Su  Valley  He invited  the  deputy                                                               
commissioner  to  come  talk  to  the  Wasilla  airport  advisory                                                               
commission.                                                                                                                     
                                                                                                                                
CHAIR MENARD asked  how the capitol budget  affected the aviation                                                               
plan this past year.                                                                                                            
                                                                                                                                
MAYOR RUPRIGHT replied  they didn't get any funding,  but they do                                                               
have "some money in the bucket."  He again emphasized the need to                                                               
complete the  nine tenths  of a  mile of  roadway to  connect the                                                               
airport to downtown and to the FEMA center.                                                                                     
                                                                                                                                
12:26:00 PM                                                                                                                   
SENATOR  MEYER agreed  that the  infrastructure hasn't  kept pace                                                               
with the growth  in the Mat-Su Valley. He asked  for an update on                                                               
the  plans for  a ferry  to provide  transportation across  Upper                                                               
Cook Inlet until the Knik Arm Bridge is built.                                                                                  
                                                                                                                                
MAYOR RUPRIGHT said his understanding  is that the ferry has been                                                               
built and  will be stored  in Southeast until the  Mat-Su Borough                                                               
resolves the issues with the docking facility.                                                                                  
                                                                                                                                
SENATOR  DAVIS asked  what his  highest priorities  are and  what                                                               
he's doing to reach his goals.                                                                                                  
                                                                                                                                
MAYOR RUPRIGHT replied  a top priority is to  get connectivity on                                                               
South Mack  road to  the sports  arena. It's  been on  both their                                                               
federal  and  state  wish  list  to  no  avail.  He  opined  that                                                               
attending this  meeting possibly brought home  to representatives                                                               
in  other areas  of  the  state that  the  Wasilla  area and  the                                                               
borough are becoming very crowded.                                                                                              
                                                                                                                                
12:31:27 PM                                                                                                                   
SENATOR DAVIS questioned  whether anyone in the  room could speak                                                               
to the issue of completing the nine tenths of a mile of roadway.                                                                
                                                                                                                                
CHAIR MENARD held the question in abeyance.                                                                                     
                                                                                                                                
REPRESENTAIVE RAMRAS joined the committee.                                                                                      
                                                                                                                                
CHAIR MENARD  asked Joe Griffith  and Cherty Heinze to  brief the                                                               
committee on the new "BuildAPlane" program.                                                                                     
                                                                                                                                
JOE  GRIFFITH,  General  Manager,  Matanuska  Electric,  credited                                                               
Cheryl Heinze  for doing  a lot  of the  work on  the BuildAPlane                                                               
program.  Basically,  he  said,  Matanuska  Electric  provided  a                                                               
facility in  Talkeetna for  three years and  he gave  the program                                                               
his airplane.                                                                                                                   
                                                                                                                                
12:34:47 PM                                                                                                                   
CHERYL    HEINZE,   Community    Affairs,   Matanuska    Electric                                                               
Association, highlighted Mr.  Griffith's aviation accomplishments                                                               
and explained  that the BuildAPlane  (BAP) project is a  forum to                                                               
teach the disciplines  of math and science  to kids, particularly                                                               
kids  with   an  interest  in  aviation.   Rebecca  Fischer  from                                                               
Talkeetna brought the  idea forward and has  enlisted the support                                                               
of  20 aviation-oriented  volunteers in  the Talkeetna  area. The                                                               
FAA  is a  partner  and  Snap-On Tools  provides  tools  at a  50                                                               
percent  discount.  FEDEX  and  UPS help  move  planes  from  the                                                               
donation point  to the  project site. Right  now, Alaska  has BAP                                                               
projects in Hooper Bay and Talkeetna.                                                                                           
                                                                                                                                
MS. HEINZE said it's most  impressive that the school board backs                                                               
the project and  has incorporated an introduction  to aviation in                                                               
this fall's  curriculum. The kids  can take this course  and then                                                               
go to  the donated building and  learn how to build  an airplane.                                                               
Without being  asked, Mr. Griffith  donated his canvas  and metal                                                               
ground-loop  Stinson.  This  is   a  win-win  for  everyone,  she                                                               
concluded.                                                                                                                      
                                                                                                                                
12:39:07 PM                                                                                                                   
MR.  GRIFFITH  thanked  the  committee  for  the  opportunity  to                                                               
spotlight the  BAP project and  reiterated that it's of  value to                                                               
the kids and he's happy to take part.                                                                                           
                                                                                                                                
REPRESENTATIVE P. WILSON said she'll  eagerly follow this project                                                               
and  she hopes  it will  engender interest  in math  and science,                                                               
which will be reflected in improved scores.                                                                                     
                                                                                                                                
MR. GRIFFITH said  that's the intent. He added  that the airplane                                                               
he donated  will provide ample learning  opportunities because he                                                               
delivered it disassembled and in boxes.                                                                                         
                                                                                                                                
MS. HEINZE suggested that Representative  Wilson look at starting                                                               
a BAP project in her area.                                                                                                      
                                                                                                                                
CHAIR MENARD said she asked  for this particular briefing because                                                               
Alaska has  more private pilots  per capita than anyplace  in the                                                               
nation.                                                                                                                         
                                                                                                                                
12:43:34 PM                                                                                                                   
CHAIR MENARD asked  Mr. Richards to address  the question Senator                                                               
Davis  asked  earlier  about  completing  the  small  section  of                                                               
roadway to connect the Wasilla airport and the FEMA center.                                                                     
                                                                                                                                
MR. RICHARDS explained that DOTPF  has had communication with the                                                               
city  of  Wasilla  about  the   needs  at  the  airport  and  the                                                               
connecting  road. As  he mentioned  earlier,  the department  has                                                               
literally  billions  of  dollars   of  needs  on  existing  roads                                                               
throughout  the state  and new  roads  have to  be nominated  and                                                               
compete against those existing needs.  Unless there is a specific                                                               
general  fund appropriation  to address  that new  road it  won't                                                               
score well  under the existing  federal highway  funding program.                                                               
Although he  doesn't have specific  information on  this project,                                                               
it probably hasn't  risen to the level of a  STIP project because                                                               
it  doesn't  meet  the  criteria. Nevertheless,  he  said  he  is                                                               
willing to  work with  the community to  address their  needs and                                                               
help them through the process.                                                                                                  
                                                                                                                                
CHAIR MENARD commented  that the fact that it will  link the FEMA                                                               
center score some points.                                                                                                       
                                                                                                                                
SENATOR DAVIS suggested the mayor look at funding alternatives.                                                                 
                                                                                                                                
12:47:08 PM                                                                                                                   
MAYOR  RUPRIGHT   responded  he's  contacted   the  congressional                                                               
delegation and Senator Murkowski is  trying to get $1 million for                                                               
the  project. He  articulated the  frustration in  having a  FEMA                                                               
center that isn't  connected to the airport and  pointed out that                                                               
in the event  of a catastrophic disaster the  center couldn't get                                                               
resupplied if the road is shut down.                                                                                            
                                                                                                                                
MR. RICHARDS suggested  it may take a  multifaceted, multi agency                                                               
approach  to  accomplish  this  project.  He  mentioned  the  FAA                                                               
options,  the federal  transit options,  and potentially  federal                                                               
highway and general fund dollars.                                                                                               
                                                                                                                                
MR. RICHARDS informed  the committee that he just  learned that a                                                               
crane  operating  on  the  Barnett  Street  Bridge  in  Fairbanks                                                               
toppled this morning. Fortunately no one was seriously injured.                                                                 
                                                                                                                                
REPRESENTATIVE  RAMRAS said  he's  interested  in what  authority                                                               
Alaska's  U.S.  Senators  have  to  re-appropriate  some  of  the                                                               
highway funds  out of the  $17 million community  airport project                                                               
in Senator Hoffman's district to  address the concerns that Mayor                                                               
Rupright has brought forward.                                                                                                   
                                                                                                                                
MR. RICHARDS  said he  recalls that  the most  publicized airport                                                               
project   was  in   the  small   community   of  Ouzinkie   where                                                               
approximately $12  million was appropriated. Those  were American                                                               
Recovery Act funds and could only  be spent on airports that were                                                               
"shovel ready." That  project will be completed this  fall and it                                                               
will have consumed all the funds available to it.                                                                               
                                                                                                                                
He noted  that the  FAA does  have a  pot of  discretionary funds                                                               
available  on a  national  basis  and the  local  FAA office  can                                                               
compete  for  those  funds.  This  is  in  addition  to  the  set                                                               
allocation that goes to each  state annually based on population,                                                               
number of airports, and other criterion.                                                                                        
                                                                                                                                
12:55:59 PM                                                                                                                   
REPRESENTATIVE  RAMRAS  expressed  interest in  signing  a  block                                                               
letter supporting  moving forward on getting  discretionary funds                                                               
through the FAA.                                                                                                                
                                                                                                                                
MAYOR RUPRIGHT said he appreciates the help.                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON asked  Mr. Luiken if he  could address the                                                               
major impact that the FAA  reauthorization could have on tourism,                                                               
hunting, and fishing to Alaska.                                                                                                 
                                                                                                                                
MR.  LUIKEN replied  he isn't  prepared to  address this,  but he                                                               
would like  the opportunity to  do so at  a later time.  He added                                                               
that he  knows that the  FAA is getting  close to a  version that                                                               
will be agreed to by both houses in Congress.                                                                                   
                                                                                                                                
REPRESENTATIVE JOHNSON  said he wants  this on the  radar because                                                               
it will be a huge issue for this state.                                                                                         
                                                                                                                                
CHAIR MENARD  advised the committee  that this is just  the first                                                               
of several transportation overviews.                                                                                            
                                                                                                                                
There being  no further  business to  come before  the committee,                                                               
Chair  Menard   adjourned  the  Senate   Transportation  Standing                                                               
Committee hearing at 1:00 p.m.                                                                                                  

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