Legislature(2017 - 2018)BUTROVICH 205

01/26/2017 01:30 PM Senate TRANSPORTATION

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Audio Topic
01:28:53 PM Start
01:30:01 PM Presentation: Airport Improvement Program (aip)
02:04:49 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Aviation Improvement Program TELECONFERENCED
Deputy Commissioner John Binder
                    ALASKA STATE LEGISLATURE                                                                                  
            SENATE TRANSPORTATION STANDING COMMITTEE                                                                          
                        January 26, 2017                                                                                        
                           1:28 p.m.                                                                                            
MEMBERS PRESENT                                                                                                               
Senator Bert Stedman, Chair                                                                                                     
Senator Anna MacKinnon                                                                                                          
Senator Click Bishop                                                                                                            
Senator David Wilson                                                                                                            
Senator Dennis Egan                                                                                                             
MEMBERS ABSENT                                                                                                                
All members present                                                                                                             
COMMITTEE CALENDAR                                                                                                            
PRESENTATION: AIRPORT IMPROVEMENT PROGRAM (AIP)                                                                                 
     - HEARD                                                                                                                    
PREVIOUS COMMITTEE ACTION                                                                                                     
No previous action to record                                                                                                    
WITNESS REGISTER                                                                                                              
JOHN BINDER, Deputy Commissioner                                                                                                
Department of Transportation and Public Facilities (DOTPF)                                                                      
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Presented an overview of the Aviation                                                                     
Improvement Program (AIP).                                                                                                      
ACTION NARRATIVE                                                                                                              
1:28:53 PM                                                                                                                    
CHAIR  BERT STEDMAN  called  the  Senate Transportation  Standing                                                             
Committee meeting  to order at 1:28  p.m. Present at the  call to                                                               
order were  Senators Egan, MacKinnon, Bishop,  and Chair Stedman.                                                               
Senator Wilson arrived shortly thereafter.                                                                                      
^PRESENTATION: AIRPORT IMPROVEMENT PROGRAM (AIP)                                                                                
        PRESENTATION: AIRPORT IMPROVEMENT PROGRAM (AIP)                                                                     
1:30:01 PM                                                                                                                    
CHAIR STEDMAN announced that the  only order of business would be                                                               
a  presentation by  the Department  of Transportation  and Public                                                               
Facilities (DOTPF)  on the Airport Improvement  Program (AIP). He                                                               
noted this would be the first of several presentations by DOTPF.                                                                
CHAIR  STEDMAN stated  that throughout  the  session, the  Senate                                                               
Transportation  Committee will  be  looking  at aviation,  roads,                                                               
harbors,   buildings,  as   well  as   examining  the   Statewide                                                               
Transportation  Improvement Program  (STIP).  The committee  will                                                               
examine  DOTPF's role  in the  various regions  of the  state and                                                               
look at projections related to  changes in the federal government                                                               
and  the  increased  allocation  of highway  money  in  order  to                                                               
provide information for the Senate  Finance Committee to use when                                                               
formulating the  capital budget. He predicted  that the committee                                                               
will  be  more  active than  previous  transportation  committees                                                               
several  years ago  because funds  coming into  DOTPF may  be the                                                               
bulk  of funds  coming  into  the capital  budget  over the  next                                                               
several years. A  goal is to have fair allocation  of capital and                                                               
quality projects moving forward.                                                                                                
He noted the arrival of Senator Wilson.                                                                                         
1:32:30 PM                                                                                                                    
JOHN  BINDER, Deputy  Commissioner, Department  of Transportation                                                               
and  Public  Facilities (DOTPF),  presented  an  overview of  the                                                               
Federal  Aviation   Administration  (FAA)   Aviation  Improvement                                                               
Program (AIP).  He pointed out  that the state owns  and operates                                                               
242  airports,  two  of which  are  Anchorage  International  and                                                               
Fairbanks International  that do not contribute  to, nor receive,                                                               
general  funds. The  remaining  240 airports  make  up the  rural                                                               
system  - the  Division of  Statewide  Aviation -  and there  are                                                               
several  private airports.  He  stated that  the  AIP provides  a                                                               
significant portion  of the federal  funding that flows  into the                                                               
state for capital programs.                                                                                                     
1:33:27 PM                                                                                                                    
MR. BINDER  highlighted an employee of  DOTPF, Kristen Patterson,                                                               
who  works   as  an  accounting   technician  at   the  Fairbanks                                                               
International Airport.                                                                                                          
1:34:08 PM                                                                                                                    
MR. BINDER provided  an overview of his presentation.  He said he                                                               
will  address the  FAA AIP,  Alaska's  benefit, aviation  capital                                                               
needs  determination,  and  the  airport  project  prioritization                                                               
He  shared  information  about the  Airport  Improvement  Program                                                               
(AIP), which  is funded by the  Airport and Airway Trust  Fund, a                                                               
congressional  program.  It  depends on  continued  congressional                                                               
authorization  and  annual  appropriations. It  provides  federal                                                               
grants to  eligible airport sponsors of  eligible projects. There                                                               
are   strict  rules   governing  eligibility,   procurement,  and                                                               
implementation. Sponsors accepting grants  must abide by 39 grant                                                               
1:35:57 PM                                                                                                                    
MR. BINDER  addressed the Airport  and Airway Trust  Fund (AATF).                                                               
It was created by the  Airport and Airway Development and Revenue                                                               
Act of  1970 to finance  aviation programs. Revenues  are derived                                                               
from  aviation-related excise  taxes  on  passengers, cargo,  and                                                               
fuel. The AATF provides most  of the appropriated funding for the                                                               
FAA,  such as  operations, facilities,  equipment, research,  and                                                               
capital improvements.                                                                                                           
He  turned to  the Alaska  Region Airport  System and  listed the                                                               
various  types of  airports in  Alaska. There  is one  medium hub                                                               
primary airport -  Anchorage. Fairbanks and Juneau  are small hub                                                               
primary  airports. Primary  airports  must have  at least  10,000                                                               
passengers board planes each year.                                                                                              
1:37:19 PM                                                                                                                    
SENATOR  MACKINNON  restated  that  Anchorage  is  a  medium  hub                                                               
MR. BINDER  said there are  26 non-hub primary airports,  such as                                                               
Bethel, Dillingham,  and Barrow. There are  58 commercial service                                                               
airports which have  more than 2,500 passengers a  year, but less                                                               
than  10,000. The  remaining 58  general  aviation airports  have                                                               
less than 2,500 passengers.                                                                                                     
1:38:16 PM                                                                                                                    
MR. BINDER showed a graph of  the ten-year history of AIP funding                                                               
in the  Alaska Region. Generally,  about $200 million  comes into                                                               
the  state   each  year.  He   said  about  half   comes  through                                                               
entitlements and half is discretionary.                                                                                         
1:39:06 PM                                                                                                                    
CHAIR STEDMAN asked  for an estimate of what 2017  and 2018 might                                                               
look like.                                                                                                                      
MR.  BINDER estimated  the funding  would be  about the  same, as                                                               
long as  the AIP  is funded above  $3.2 billion  nationally. This                                                               
year the funding will be $3.35 billion.                                                                                         
1:39:41 PM                                                                                                                    
MR.  BINDER explained  AIP  Apportionment/Entitlements for  DOTPF                                                               
Airports in FY2016.  He said the FAA  airport capital improvement                                                               
project funding  program was $169.8  million. He broke  that down                                                               
into various entitlements:  cargo, primary passenger, non-primary                                                               
passenger, state  apportionment -  a formula  based on  land mass                                                               
and population, Alaska supplemental, and discretionary funds.                                                                   
1:41:56 PM                                                                                                                    
MR. BINDER turned to AIP legislative authority.                                                                                 
1:42:14 PM                                                                                                                    
SENATOR  BISHOP commented  on Alaska's  never turning  money away                                                               
because it  always has  projects that  are ready  to go.  He gave                                                               
credit for that to DOTPF's quality design team.                                                                                 
MR. BINDER agreed.                                                                                                              
He related that  the FAA is operating under  the authorization of                                                               
the  FAA  Extension,  Safety,  and  Security  Act  of  2016.  Its                                                               
timeframe  is through  September 30  of 2017  and it  consists of                                                               
$3.35  billion.  Congressional  reauthorization  is  required  in                                                               
FY2018. He  noted that  DOTPF is in  contact with  the Governor's                                                               
Office  and  the Alaska  delegation  about  Alaska's desires  and                                                               
1:43:15 PM                                                                                                                    
MR. BINDER shared FAA's national  goals and objectives: provide a                                                               
safe  and  secure airport  and  airway  system, minimize  airport                                                               
noise  impacts, develop  reliever airports,  cargo hub  airports,                                                               
and intermodal transportation,  protect natural resources, reduce                                                               
aircraft delays, convert  former military air bases  to civil use                                                               
or  improve  joint-use  airports,  and carry  out  various  other                                                               
projects to ensure a safe and efficient airport system.                                                                         
1:43:43 PM                                                                                                                    
He listed Alaska regional goals.  Because of the unique nature of                                                               
the  aviation system  in Alaska,  the FAA  (Alaska Region)  has a                                                               
subset  of  targeted goals  and  objectives  for the  AIP  within                                                               
Alaska. The  first is  to provide  and enhance  safe aeronautical                                                               
access  for  rural  Alaskan  communities.   This  goal  has  been                                                               
completed.  The  second  goal  is to  preserve  and  enhance  the                                                               
condition of  paved airport  surfaces, and the  third goal  is to                                                               
enhance the safety and security of airports.                                                                                    
1:44:33 PM                                                                                                                    
SENATOR  MACKINNON  asked whether  aviation  mapping  is a  goal,                                                               
especially for  the smaller  airports, and  where she  could find                                                               
that information.                                                                                                               
MR. BINDER replied  that there are mapping  efforts underway, but                                                               
they  are   primarily  managed  by  the   Department  of  Natural                                                               
Resources  (DNR) and  the Alaska  Geospatial Council  (AGC). They                                                               
include safety elements and elevation mapping.                                                                                  
1:45:45 PM                                                                                                                    
He highlighted several  key projects in the  current year. Angoon                                                               
will get  a new airport, Aniak  will begin construction on  a new                                                               
runway  this  summer, Kiana  will  extend  and reconstruct  their                                                               
runway, and Atqasuk will have a rehabilitated runway.                                                                           
1:46:31 PM                                                                                                                    
SENATOR MACKINNON spoke  of new construction in  rural areas. She                                                               
wondered if  there are  rural airports  that are  close together.                                                               
She  mentioned Toksook  Bay as  an example.  When looking  at new                                                               
airport  projects,  she wondered  if  consideration  is given  to                                                               
whether there are other nearby airports.                                                                                        
1:47:34 PM                                                                                                                    
MR. BINDER said  the state and FAA are not  looking to spend more                                                               
money  if there  are  viable  nearby airports.  He  spoke of  the                                                               
challenges of building and  maintaining roads between communities                                                               
and the benefits of clustering airports.                                                                                        
1:48:28 PM                                                                                                                    
He  listed runway  improvement projects  and safety  and security                                                               
items and repairs.                                                                                                              
1:49:18 PM                                                                                                                    
He showed  the breakdown  of AIAS capital  funding in  FY2016 and                                                               
the anticipated  funding in FY2017  for Anchorage  and Fairbanks.                                                               
He pointed out dollars that went to the rural system.                                                                           
1:50:05 PM                                                                                                                    
MR. BINDER addressed AIP rural  system funding for FY2013 through                                                               
FY2016 from  federal capital  funding and  from state  match. For                                                               
everything but  Anchorage, the match is  93.75/6.25. Remote sites                                                               
are  eligible  for a  95/5  split.  Anchorage is  an  87.75/12.25                                                               
split. He  pointed out that  AIAS match is paid  by International                                                               
Airport Revenue Funds (IARF), not state general funds.                                                                          
1:51:37 PM                                                                                                                    
MR.  BINDER  listed  the  major  rural  system  AIP  construction                                                               
projects expected to  be funded in FY2017 and  FY2018. He offered                                                               
to provide more information as requested.                                                                                       
He discussed the Airport Project  Evaluation Board (APEB) members                                                               
and duties and  the Project Evaluation Board  process, noting the                                                               
Board is constantly reviewing the  project list. He mentioned the                                                               
Airport Spending  Plan Development, which results  in a five-year                                                               
rolling plan.                                                                                                                   
1:53:40 PM                                                                                                                    
SENATOR  BISHOP asked  if there  has been  any discussion  by the                                                               
federal administration about airport fund expansion.                                                                            
MR. BINDER  replied that he  saw an  article that said  about $30                                                               
billion may  be allocated toward  aviation to be rolled  into the                                                               
Airport Improvement Plan for several years.                                                                                     
1:54:37 PM                                                                                                                    
SENATOR EGAN stated that Juneau  is the largest municipal airport                                                               
in the state.  He wondered how it fits into  the funding picture.                                                               
He pointed out that Juneau did well last year.                                                                                  
1:55:18 PM                                                                                                                    
MR. BINDER  replied that the  Division of Statewide  Aviation and                                                               
DOTPF take  on the  funding coordination  role. All  airports are                                                               
talking to  each other regardless  of the  owner/operator. Juneau                                                               
generates  its own  revenue and  makes its  own match  to federal                                                               
dollars. When Juneau  has a capital project  pending, DOTPF helps                                                               
with grant applications which funnel through DOTPF to FAA.                                                                      
SENATOR EGAN asked if all  funding for Juneau's airport equipment                                                               
must have DOTPF's approval.                                                                                                     
MR. BINDER  explained that  DOTPF does not  approve or  object to                                                               
funding requests; it facilitates paperwork.                                                                                     
SENATOR  EGAN   noted  that   Alaska  has   242  state-maintained                                                               
airports. He asked which state has the second largest number.                                                                   
MR. BINDER thought  it was Oregon with 40 airports.  He said most                                                               
states do not own or operate airports.                                                                                          
1:57:17 PM                                                                                                                    
SENATOR MACKINNON asked what Juneau's federal/state match is.                                                                   
MR. BINDER thought it was a 93.75/6.25 split.                                                                                   
SENATOR MACKINNON  asked if the  federal allocation to  Juneau is                                                               
subtracted from the state's distribution.                                                                                       
MR.  BINDER said  yes. Juneau  earns  some of  their own  funding                                                               
through  the entitlement  piece, but  they also  use some  of the                                                               
discretionary funding  that comes out  of DOTPF's cut.  Alaska is                                                               
treated as a whole.                                                                                                             
1:58:22 PM                                                                                                                    
SENATOR  MACKINNON spoke  of a  reciprocal  agreement with  other                                                               
corporations  that land  at state-owned  facilities for  aviation                                                               
fuel. She thought it was about  half of the current fuel tax. She                                                               
wondered if  there was  also a  reciprocal agreement  for foreign                                                               
vessels.  She questioned  whether  the state  benefits from  that                                                               
MR. BINDER did  not know. He said that  international air traffic                                                               
is exempt.                                                                                                                      
CHAIR STEDMAN requested  Mr. Binder find out and get  back to the                                                               
SENATOR  MACKINNON said  she has  not  been able  to locate  that                                                               
information and  would like to see  if it is an  additional piece                                                               
of revenue  for Alaska.  She shared  that Minnesota  has recently                                                               
removed that tax credit.                                                                                                        
2:00:48 PM                                                                                                                    
CHAIR STEDMAN noted there would be  a fuel tax bill coming up and                                                               
they could discuss the issue then.                                                                                              
2:01:13 PM                                                                                                                    
SENATOR  MACKINNON   asked  whether  there  is   another  airport                                                               
facility  close to  Toksook Bay  or  Angoon. She  noted that  the                                                               
state  is investing  funds for  airport renovation  and buildings                                                               
2:02:23 PM                                                                                                                    
MR.  BINDER  said there  is  not  another airport  available  for                                                               
Angoon; he did not know for Toksook Bay.                                                                                        
CHAIR STEDMAN  said that  information could  be found  for future                                                               
SENATOR  BISHOP said  he wanted  to talk  about Northway  Airport                                                               
with Mr. Binder some time.                                                                                                      
2:03:30 PM                                                                                                                    
SENATOR MACKINNON  said she is  concerned about the  erosion that                                                               
is taking  place in  Kivalina, which is  listed as  rural access.                                                               
She requested to  know more information about  whether that issue                                                               
has been resolved.                                                                                                              
CHAIR  STEDMAN suggested  Mr. Binder  provide the  committee with                                                               
that information.                                                                                                               
He announced  that the next meeting  will be January 31  and will                                                               
focus on adjusting the permitting processes of DOTPF and DNR.                                                                   
2:04:49 PM                                                                                                                    
There being  no further  business to  come before  the committee,                                                               
Chair  Stedman  adjourned   the  Senate  Transportation  Standing                                                               
Committee at 2:04 p.m.                                                                                                          

Document Name Date/Time Subjects
AIP Presentation - Jan 17.pptx STRA 1/26/2017 1:30:00 PM