00 CS FOR HOUSE BILL NO. 136(STA) 01 "An Act relating to the establishment and operation of the Alaska Railroad 02 Commission to determine whether sale of the Alaska Railroad is in the best 03 interest of the state; and providing for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. ALASKA RAILROAD COMMISSION. (a) The Alaska Railroad 06 Commission is established as an agency of the legislative branch. The commission consists 07 of five members. One member shall be appointed by the governor, one member shall be 08 appointed by the president of the senate, one member shall be appointed by the speaker of the 09 house of representatives, one member shall be appointed jointly by the governor, president of 10 the senate, and speaker of the house of representatives from among the employees of the 11 Alaska Railroad Corporation who are members of a bargaining unit representing employees 12 of the railroad, and one member shall be appointed jointly by the governor, president of the 13 senate, and speaker of the house of representatives who is a representative of the major 14 customers of the Alaska Railroad Corporation. The persons making appointments to the 01 commission shall give consideration to the appointment of persons who have experience 02 involving corporate mergers and acquisitions. A vacant seat on the commission shall be filled 03 in the manner that the seat was originally filled. 04 (b) A member of the Alaska Railroad Commission who is a public member is entitled 05 to compensation at a rate of $250 for each day the member is engaged in the actual 06 performance of duties as a commission member. The commission may provide for 07 compensation for partial days during which a member who is a public member is engaged in 08 actual performance of duties as a commission member. In addition, a member who is a public 09 member is entitled to per diem and travel expenses authorized for boards and commissions 10 under AS 39.20.180. A member of the commission who is not a public member is entitled 11 to the member's usual compensation and travel and per diem expenses as a legislator, state 12 employee, or employee of the Alaska Railroad. In this subsection, a public member of the 13 commission is a member who is not a legislator, state employee, or employee of the Alaska 14 Railroad. 15 (c) Subject to appropriations for the purpose, the Alaska Railroad Commission may 16 contract for professional services as the commission considers necessary. Contracts for 17 professional services under this subsection are exempt from AS 36.30. 18 (d) The Alaska Railroad Commission shall contract for preparation of an evaluation 19 of the Alaska Railroad as a going concern by a qualified railroad appraiser. The commission 20 shall give a preference to a private entity based in the state for the contract to perform the 21 evaluation. The evaluation shall be submitted to the governor and the Legislative Budget and 22 Audit Committee before November 1, 1996. The Alaska Railroad Corporation shall pay for 23 the evaluation from corporate receipts of the Alaska Railroad Corporation. The contract for 24 the evaluation under this subsection is exempt from AS 36.30. 25 (e) On September 1, 1996, and November 1, 1996, the Alaska Railroad Commission 26 shall submit a report to the Legislative Budget and Audit Committee detailing the progress 27 of the commission in implementing this section and the problems encountered by the 28 commission. The Legislative Budget and Audit Committee may request that the commission 29 appear before the committee to brief the committee on the progress of the commission in 30 performing the commission's functions under this section. 31 (f) By January 13, 1997, the Alaska Railroad Commission shall determine whether or 01 not it is in the best interest of the state to sell the Alaska Railroad and all other assets of the 02 Alaska Railroad Corporation classified as necessary for the operation of the railroad. In 03 reaching its determination under this subsection, the commission shall 04 (1) identify all assets, real and personal and tangible and intangible, of the 05 Alaska Railroad Corporation and classify those assets as necessary for the operation of the 06 railroad or as other assets of the corporation; 07 (2) consider the effect of a sale of the Alaska Railroad on the state, on 08 customers, lessees, and employees of the railroad, and on municipalities served or affected by 09 the railroad; 10 (3) consider the effect of privatization of the Alaska Railroad and the 11 conditions of a sale upon the long-term profitability of the railroad; 12 (4) consider the ability of the state to obtain enforceable assurances of 13 continued operation of the railroad at necessary levels of service; 14 (5) consider foreseeable economic effects of a sale of the railroad; and 15 (6) consider the value to the state of direct oversight of operations of the 16 Alaska Railroad Corporation as currently provided under law. 17 (g) Notwithstanding the determination of the commission under (f) of this section, 18 before January 13, 1997, the Alaska Railroad Commission shall also 19 (1) recommend specific conditions to be attached to a sale of the Alaska 20 Railroad, including requirements that the purchaser of the railroad agree to 21 (A) continue operation of the railroad, as an active and functioning 22 transportation system, for a minimum of 20 years following the date of sale of the 23 railroad; 24 (B) accept assignment of all contracts, including agreements with 25 connecting carriers, shippers, or other persons concerning services, operation, property, 26 and facilities of the Alaska Railroad Corporation, entered into by the Alaska Railroad 27 Corporation and in effect on the date of the sale of the Alaska Railroad, provided that 28 the contracts are assignable under terms of the contract or that the other parties to the 29 contract consent to the assignment; this subparagraph does not apply to executive 30 employment contracts; 31 (C) accept assignment of collective bargaining agreements with labor 01 organizations that represent employees of the Alaska Railroad that are in effect on the 02 date of transfer of ownership of the Alaska Railroad until expiration of the agreements; 03 (D) as a condition of the sale and before the transfer of ownership of 04 the Alaska Railroad, negotiate collective bargaining agreements, including provisions 05 for future retirement benefits if appropriate, to take effect upon the expiration of the 06 collective bargaining agreements that are in effect on the date of transfer of ownership 07 of the Alaska Railroad; 08 (E) accept assignment of the retirement obligations owed to employees 09 of the Alaska Railroad at the time of transfer of ownership of the Alaska Railroad; 10 (F) purchase the Alaska Railroad for an amount that is equal to or 11 exceeds the fair market value of the Alaska Railroad and the assets of the Alaska 12 Railroad Corporation that are necessary for the operation of the railroad; and 13 (G) provide proof of financial ability to abide by the terms of sale and 14 to operate the railroad as an active and functioning transportation system; 15 (2) recommend specific procedures and a schedule of events to be followed 16 in selling the Alaska Railroad; 17 (3) evaluate the prospects for and effects of operation of the Alaska Railroad 18 under private ownership; 19 (4) recommend procedures for the disposal of real property of the Alaska 20 Railroad Corporation that is not necessary for operation of the Alaska Railroad to the state or 21 to private persons; 22 (5) identify measures necessary to assure continued use of the railroad right-of- 23 way corridor for transportation, communication, and transmission purposes and support 24 functions associated with these purposes; and 25 (6) identify conditions or terms of a sale of the Alaska Railroad that may be 26 necessary for consistency with the Alaska Railroad Transfer Act of 1982 (P.L. 97-468, Title 27 IV) and AS 42.40 (Alaska Railroad Corporation Act). 28 (h) The Alaska Railroad Commission shall submit a comprehensive report of its 29 determination, recommendations, identifications, and evaluations made under (f) and (g) of this 30 section and of the evaluation of the Alaska Railroad under (d) of this section to the governor 31 and the Legislative Budget and Audit Committee before January 13, 1997. 01 (i) Except as provided under this subsection, the meetings of the Alaska Railroad 02 Commission shall be open to the public and shall provide an opportunity for public comment. 03 A subject may not be considered at an executive session unless the subject is mentioned in 04 the motion calling for the executive session or is auxiliary to a subject mentioned in the 05 motion. An action may not be taken at an executive session. Only the following subjects 06 may be discussed in an executive session: 07 (1) matters, the immediate knowledge of which would clearly have an adverse 08 effect upon the finances of the Alaska Railroad Corporation; 09 (2) unless the person has requested to have the subjects discussed in public, 10 subjects that tend to prejudice the reputation and character of a person; 11 (3) matters that, by law or municipal charter or ordinance, are permitted to be 12 kept confidential from public disclosure; 13 (4) matters pertaining to personnel; 14 (5) matters pertaining to the legal position of the Alaska Railroad Corporation; 15 (6) land acquisition or disposal; and 16 (7) proprietary or other information of a type treated as confidential under the 17 standards and practices of the United States Interstate Commerce Commission, including 18 practices that protect information associated with specific shippers, divisions, and contract rate 19 agreements. 20 (j) Notwithstanding AS 42.40.220 and other provisions of AS 42.40, the Alaska 21 Railroad Commission shall have access to financial records, contracts, legal documents, and 22 other records and documents of the Alaska Railroad Corporation that the commission 23 determines are necessary to perform the commission's functions under this section. The 24 members and staff of the commission shall maintain the confidentiality of confidential records 25 and documents provided by the corporation to the commission. 26 (k) The Alaska Railroad Commission may not expend more than a total of $250,000 27 to perform the commission's functions under this section. 28 * Sec. 2. This Act is repealed June 30, 1997. 29 * Sec. 3. This Act takes effect immediately under AS 01.10.070(c).