Legislature(2001 - 2002)

2001-03-09 House Journal

Full Journal pdf

2001-03-09                     House Journal                      Page 0516
HB 168                                                                                            
HOUSE BILL NO. 168 by the House Rules Committee by request of                                       
the Governor, entitled:                                                                             

2001-03-09                     House Journal                      Page 0517
     "An Act authorizing financing for certain public transportation                                
     projects; giving notice of and approving the entry into, and the                               
     issuance of revenue obligations that provide participation in,                                 
     lease-financing agreements for those transportation projects; and                              
     providing for an effective date."                                                              
was read the first time and referred to the Transportation and Finance                              
The following fiscal note(s) apply:                                                                 
1.  Fiscal, Dept. of Revenue                                                                        
The Governor's transmittal letter dated February 27, 2001, appears                                  
"Dear Speaker Porter:                                                                               
Today I am transmitting a bill that authorizes the issuance of revenue                              
obligations to finance the accelerated construction of $425 million in                              
transportation projects throughout the state.                                                       
The projects outlined in this bill represent one of the three parts of a                            
comprehensive transportation plan. In addition to the $425 million in                               
projects within this legislation, the regular statewide transportation                              
improvement program (STIP) targets $1.2 billion for projects over the                               
next three years. We are also working with our congressional                                        
delegation to secure additional federal transportation funding for large                            
projects throughout our state.                                                                      
Alaska's allocation of federal highway funds has increased in recent                                
years. Despite an aggressive six-year transportation plan that addresses                            
continued improvements to state highways, marine transportation, and                                
local roads and trails, many important transportation needs remain                                  
unmet. We must do all we can, as soon as we can, to keep up with                                    
those critical needs. Now, thanks to Grant Anticipation Revenue                                     
Vehicles (GARVEEs), an innovative federal program that many states                                  
are using, we have an opportunity to build our statewide transportation                             
infrastructure sooner than would be possible under the conventional                                 
program alone.                                                                                      

2001-03-09                     House Journal                      Page 0518
The projects to be financed with GARVEEs all qualify for federal                                    
highway aid. Because of this qualification, future federal highway aid                              
can be used to pay the principal and interest on the obligations. It is                             
also possible to use interest earnings to satisfy federal requirements for                          
state general fund match money. This method of financing allows                                     
construction of these vital projects now rather than waiting years for                              
future federal highway aid. Using this financing approach can also                                  
save money by avoiding inflationary costs that would accrue to each                                 
project if left for future construction.                                                            
The projects included in the bill serve the entire state, from Southeast                            
Alaska to the North Slope. They address pressing transportation needs                               
that may not be funded under our regular federal program for 10 years                               
or longer. Revenue obligation payments would be annually                                            
appropriated by the Legislature from federal money received as an                                   
apportionment of federal highway grants.                                                            
Timing is crucial to take full advantage of this accelerated financing                              
opportunity and the economic benefits of these construction projects.                               
Because of the need for efficiency and speed, I am proposing to                                     
finance these projects through revenue obligations, unlike the general                              
obligation approach I offered last year when I introduced a similar                                 
plan to the Legislature.                                                                            
I urge your prompt and favorable action on this innovative approach to                              
accelerate the construction of important transportation projects.                                   
                                Tony Knowles