HOUSE BILL NO. 461 "An Act making supplemental and special appropriations; and providing for an effective date." CS FOR HOUSE BILL NO. 461(FIN) "An Act making supplemental and special appropriations and amending appropriations; and providing for an effective date." Co-chair Pearce introduced SCS CSHB 461(FIN), work draft, that had already been adopted by the committee. She advised the committee that it was before them for any questions and discussion the committee may have but there would be no public testimony. Attached to the work draft was a copy of a spread sheet from Legislative Finance and how the bill currently looked. There were some proposed amendments also in members' files. Senator Donley requested that the Department of Fish and Game come to the table. The committee was advised that the front door of the building was locked and they were temporarily waiting for departmental personnel to arrive. Co-chair Pearce then said they would go to amendments. Senator Phillips MOVED amendment #6. Senator Torgerson OBJECTED. Senator Phillips said the amendment would provide funds to redo the Tok Cut-off. He felt this was a project that needed to be done as soon as possible. Senator Torgerson said that if the committee was really serious about rewriting projects in the STIP and coming forth with projects that had been ignored around the State it was not proper to take $9 million off the table. This was just a project that was brought forward by the department. He referred to a letter from the Commissioner just handed out to committee members regarding the Soldotna Bridge that was going to have to go on weight restrictions and the promise that they would take care of that with first available funding. There were many other repair projects and this request did not stand any test as far as ranking amongst other projects around the State. Senator Adams said under the Alaska National Highways system, this section of road was the worst section. He concurred with the amendment because it would help in public safety. It would also help in long-term economic development of the roads for tourism. He also agrees with his colleague from Kasilof and noted that all three amendments were good projects. Senator Sharp said that in Commissioner Perkins' letter it was stated that the project was contained in the 1998 STIP. Senator Torgerson responded saying that a couple of projects had been moved up and it was a combination from 1998. Senator Sharp said his question was if it was included in the 1998 STIP as a project as stated in the Commissioner's letter, was it included for the amount of money being talked about now? He did not understand why it was being brought up now. NANCY SLAGLE, Director, Administrative Services, Department of Transportation and Public Facilities was invited to join the committee. She said the 1998 capital budget was based on a STIP that was developed several years ago. She said it included several projects due for construction between the years 2000 and 2004. She noted deterioration of the road and weather conditions and said several of those projects were consolidated into one single project now showing in the 1998 to 2000 STIP. This was approved by the Federal Highway Administration in February. Senator Sharp said he did not get a total calculation from the Department of Transportation of all the monies put into the Tok Highway since 1989. He noted that over the past years approximately $15 million to $25 million per year have been put into that road. If it has not held up then there are serious problems. Senator Donley concurred with Senator Sharp. He felt the problem was there was no technology to rebuild the road and make it stick. He said it was on the edge of permafrost. He said he had not been convinced by the department that they had a plan to deal with this problem. He further did not understand why it was put in the fast-track supplemental. He asked Ms. Slagle that if the committee authorized the requested amount of money how much could they spend before the end of this fiscal year? Ms. Slagle said not all of it could be spent before 30 June. The department would spend it all during this construction season. They need the authority to go out to bid and then award a contract prior to 30 June. That's why they need all the funds the sooner the better so the project could be completed during the construction season. Senator Donley voiced his continued concern. He said this project did not rise to the level to be the only road project in the fast-track supplemental. There were other road projects needing quicker attention. Senator Phillips recalled the only repair to the road was fourteen miles done in 1984 - 1985. The rest went back to the mid-60's. He said much of the road was its original construction. Senator Parnell asked if anything extraordinary happened to the Tok Highway in the last six month to one year that was not anticipated before? Ms. Slagle said the weather conditions of last summer aggravated the problems that were found on the road. It had caused a larger concern on the part of those who had to travel it, including the independent traveler and the trucking industry. Senator Parnell said he shared the concerns of Senators Donley and Torgerson. However, he felt that there were other roads that could be considered in the fast-track supplemental. Senator Sharp said there had been promises made that the original section of the Alaska Highway road was going to be repaired for the past five years. He noted how narrow the road was and that said there was not ten inches of shoulder either side of the road. He said however, that he would vote in favor of this amendment because the road was a vital link to get the tourists into Anchorage and Fairbanks. Senator Donley said he would like to vote in favor of this amendment but he did not see the distinction of this road and other really imperative transportation projects around the State. He felt the department had not made a good case and said the department had such a bizarre record in how they had manipulated the STIP over the years. Senator Torgerson said he thought the debate had been good and had no objection to seeing the project going forward, however, not in this form. In referring again to the Soldotna River bridge he said it had been constructed in 1962 and felt it would rank higher than the Tok Highway project. Senator Phillips reiterated this was the worst section of the road. Both international truckers and American Customs had complained to him regarding the condition of the road. By a roll call vote of four yeas (Pearce, Sharp, Phillips, Adams) and three nays (Torgerson, Parnell, Donley) amendment Senator Adams MOVED amendment #7. Co-chair Pearce objected. By a roll call vote of one yea (Adams) and six nays (Pearce, Sharp, Donley, Torgerson, Parnell, Phillips) amendment #7 FAILED. Senator Torgerson MOVED amendment #8. Senator Sharp OBJECTED. Senator Torgerson explained that these were projects promised by the Department of Transportation. The Kenai Bridge needed to have been done a long time ago. Co- chair Pearce asked if the bridge project had been authorized. Senator Torgerson said it was in the STIP on page eight. Senator Donley felt the amendment included two projects and it therefore should be divided. Amendment #8(A) would become the Soldotna Urban and Kenai River Bridge and amendment 8(B) would become the Funny River Road. (pause on record) Senator Donley MOVED the division of amendment #8 as explained and WITHOUT OBJECTION it was so ORDERED. Senator Parnell asked if this was different that the previous amendment. Co-chair Pearce indicated that this was a request by the Administration but did not mean that the Senate Finance Committee had to include it as she was uncomfortable adding new projects. The whole mission was to cut down the supplemental to fit into $16.5 million. To begin adding back, in her opinion, in budget parlance, was going in the wrong direction. She did, however, understand Senator Torgerson's frustration with the Department of Transportation. She asked for the correct figures before the committee took any action. Senator Torgerson advised the correct numbers for amendment Federal funds and $805,000 general fund match. Co-chair Pearce asked Senator Sharp, since he was doing the capital budget if he had any comments. Senator Sharp said with the flexibility the department showed in regards to the STIP, therefore the committee was entitled to some flexibility when writing the budget and what is put in the STIP. Senator Torgerson moved amendment #8(A) and by a roll call vote of four yeas (Donley, Torgerson, Parnell, Adams) and three nays (Pearce, Sharp, Phillips) it was ADOPTED. Senator Torgerson then advised the correct numbers for amendment #8(B). The breakdown for the amount of $4,200,000 was: $3,820,800 Federal funds and $379,200 in general funds. Senator Sharp moved that #8(B) be amended to take the GF out of SLA 1996 GF, same as in the description of the Tok Highway. Senator Adams OBJECTED and then WITHDREW his objection. WITHOUT OBJECTION amended amendment #8(B) was AMENDED. Senator Torgerson MOVED amended amendment #8(B) and by a roll call vote of three yeas ((Sharp, Torgerson, Phillips) and four nays (Pearce, Donley, Adams, Parnell) FAILED. Senator Sharp MOVED to RESCIND adoption of amendment #8(A). Senator Torgerson OBJECTED and then WITHDREW his objection. WITHOUT OBJECTION action on amendment #8(A) was RESCINDED. Senator Sharp MOVED to amend amendment #8(A) by reappropriating $805,000 GF be taken out of SLA 1996 GF. Co-chair Pearce requested the committee take an at ease. Upon reconvening the committee a roll call vote was taken on amended amendment #8(A). By a vote of six yeas (Sharp, Adams, Parnell, Torgerson, Donley, Phillips) and one nay (Pearce) amended amendment #8(A) was ADOPTED. Co-chair Pearce requested the committee take another at ease. She reconvened the committee at approximately 11:00 p.m. Senator Donley MOVED to RESCIND committee action on amendment #6. Senator Torgerson OJBECTED. By a roll call vote of five yeas (Pearce, Sharp, Donley, Phillips, Parnell) and two nays (Torgerson, Adams) committee action on amendment #6 was RESCINDED. Senator Donley MOVED rescinded amendment #6 and by a roll call vote of six yeas (Pearce, Sharp, Donley, Phillips, Adams, Parnell) and one nay (Torgerson) it was ADOPTED. Senator Sharp MOVED to RESCIND committee action on amended amendment #8(A). Senator Torgerson OBJECTED. By a roll call vote five yeas and two nays it was RESCINDED. Senator Sharp MOVED amended amendment #8(A) and by a roll call vote of two yeas (Torgerson, Adams) and five nays (Pearce, Sharp, Parnell, Donley, Phillips) it FAILED. (Tape #96, Side B switched to Tape #97, Side A.) Senator Adams MOVED amendment #10. He said the amount of $199,500 would be appropriated from the general fund, of which the sum of $102.700 would go to the Department of Law for the tort reform constitutional challenge and the sum of $56,800 be appropriated form the general fund for the Department of Fish and Game for land lease costs at the Sikusuiliaq Hatchery for the fiscal year ending June 30, 1998. Senator Donley OBJECTED. Senator Adams spoke to his amendment. Senator Donley asked Senator Adams to explain why the amount of $56,800 was needed. Senator Adams said 2.5 acres of land was leased from a private individual by the State of Alaska for a hatchery. It was not funded and therefore is passed lease payments that are owned to an individual. In further response to Senator Donley, Senator Adams said the hatchery was closed now. This was monies owed to the individual. By a roll call vote of one yea (Adams) and six nays (Pearce, Sharp, Donley, Torgerson, Parnell, Phillips) amendment #10 FAILED. Senator Donley advised Co-chair Pearce at this time he would not be offering amendment #9. Senator Donley requested the Department of Fish and Game be called to join the committee. KEVIN BROOKS, Director, Administrative Services, Department of Fish and Game was invited to join the committee. Senator Donley asked him to explain "commercial fish" and "sport fish" for the committee because the department had a very confusing relationship between the two regarding funding. He said there were certain Federal requirements regarding the segregation of those funds. Senator Donley said he had asked the Commissioner for a clarification but received only a philosophical reply. He said he knew sport funds were used indirectly but wanted to be assured they were not being used improperly. Mr. Brooks said the particular receipts in question for the Sitka Test Fishery were test fisheries receipts and were created last year. They were generated by the department contracting a vessel to go out and commercially fish prior to the opening of a fishery. Those fish taken were then sold under the department's fish ticket and the funds were used for management of that fishery. He said this had nothing to do with the Fish and Game fund or Federal aid dollars. It is a specific, distinct funding source, used exclusively in the "com fish" side of the department. Senator Donley said he understood that, but was afraid the department was using sport fish funds to cover administrative costs. Mr. Brooks said approximately six percent of all contracts was assessed for an administrative overhead which was covered by Federal aid dollars. Fish and Game funds were used within the Division of Administrative Services primarily to run the licensing program to license anglers and hunters throughout the State. The third piece of the budget was made up of general funds which is just under $1 million. That money benefits all divisions within the department. He further noted that every project they do and every use of the dollars has to be approved by the Federal granting agencies. This was a fairly vigorous approval process for expenditure of those funds. They not only go through a process with the State Legislature but also the Federal granting agencies. Senator Parnell asked about the Bristol Bay incident wherein fishermen were concerned about the State using a seiner in the area and further that the waters were closed to commercial fishermen. He wanted to know how these receipts were related to the Sitka herring roe; if these were receipts from test fisheries in Southeast or were they Statewide receipts. Mr. Brooks said the receipts for the Sitka herring fishery would occur in Sitka. Receipts were kept by region or area. Any receipts generated in Bristol Bay would be used in Bristol management. Senator Sharp MOVED SCS CSHB 461(FIN) and WITHOUT OBJECTION it was REPORTED OUT with individual recommendations. Co-chair Pearce reviewed the schedule for tomorrow, indicating the committee would meet again at 10:00 a.m. and 4:30 p.m. ADJOURNMENT Co-chair Pearce thanked fellow Senators and all staff for remaining in session late into the evening. She recessed the committee at approximately 11:30 p.m. SFC-98 -1- 3/24/98