Legislature(1993 - 1994)
04/25/1993 12:10 PM House FIN
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* first hearing in first committee of referral
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+ teleconferenced
= bill was previously heard/scheduled
HOUSE BILL NO. 124
"An Act relating to grants to municipalities, named
recipients, and unincorporated communities;
establishing capital project matching grant programs
for municipalities and unincorporated communities;
establishing a local share requirement for capital
project grants to municipalities, named recipients, and
unincorporated communities; and providing for an
effective date."
Co-Chair MacLean provided members a with work draft for HB
124 (FIN), 8-GH1018\O (copy on file). Co-Chair MacLean
provided members with AMENDMENT 1 (Attachment 1). She
explained that Amendment 1 would create a sliding scale and
change 8 percent to 7 percent. Co-Chair MacLean MOVED to
ADOPT AMENDMENT 1. There being NO OBJECTION, it was so
ordered.
Representative Brown presented members with AMENDMENT 2
(Attachment 2). Amendment 2 would define "capital project"
as a project with a cost exceeding $10.0 thousand dollars...
with an anticipated life exceeding one year..." She
suggested that the Amendment be amended to $5.0 thousand
dollars a year over two years.
SHELBY STASTNY, DIRECTOR, OFFICE OF BUDGET AND MANAGEMENT
did not have objections to Representative Brown's amendment
or amendment to the Amendment. Co-Chair Larson expressed
concern that school districts and municipalities would use
the matching grant for deferred maintenance. Representative
Martin expressed concern that the $5.0 thousand dollar
eligibility requirement would result in more administrative
costs.
Representative Parnell asked if the Internal Revenue Code
definition of capital project would apply. Mr. Stastny
replied that the Internal Revenue Code defines "capital
project" as any expenditure that is expected to last more
than a year and/or extend the life of an asset.
Representative Grussendorf noted that the definition of
capital project contained in Amendment 2 would only apply to
the Capital Matching Program.
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Co-Chair Larson stressed that municipalities can handle
smaller maintenance projects. Representative Brown asserted
that small communities need flexibility.
Representative Brown MOVED to AMEND Amendment 2 to insert
"$5.0" and delete "$10.0" and delete "one" and insert "two"
years. Representative Martin OBJECTED. A roll call vote
was taken on the motion.
IN FAVOR: Parnell, Brown
OPPOSED: Grussendorf, Foster, Hanley, Martin, Parnell,
Therriault, MacLean, Larson
Representatives Hoffman and Navarre were not present for the
vote.
The MOTION FAILED (2-8).
Representative Brown MOVED to ADOPT AMENDMENT 2.
Representative Martin OBJECTED. A roll call vote was taken
on the motion.
IN FAVOR: Therriault, Brown, Foster, Grussendorf, MacLean
OPPOSED: Martin, Parnell, Hanley, Larson
Representatives Hoffman and Navarre were not present for the
vote.
The MOTION PASSED (5-4).
Representative Brown provided members with AMENDMENT 3
(Attachment 3). She explained that the Amendment would
acknowledge that the state is not responsible for operation
of projects. She discussed Amendment 3. Members discussed
the affect of the amendment on CSHB 82 (FIN).
Representative Brown WITHDREW AMENDMENT 3.
Co-Chair MacLean expressed concern that page 4, line 20 and
23 needs further clarification to identify money spent as
capital matching money.
JACK FARGNOLI, OFFICE OF MANAGEMENT AND BUDGET, OFFICE OF
THE GOVERNOR observed that language should be adopted to
define that "10 percent of the total amount of money spent
on land acquisition" applies to the appropriation or grant.
Representative Brown provided members with AMENDMENT 4
(Attachment 4). She explained that Amendment 4 will clarify
that no more than 10 percent of state money will go to the
administrative cost for the whole project. Representative
Brown MOVED to ADOPT AMENDMENT 4. There being NO OBJECTION,
it was so ordered.
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Representative Brown provided members with AMENDMENT 5
(Attachment 5). She explained that Amendment 5 will forward
fund the program. The Office of Management and Budget would
have the summer months to establish regulations.
Representative Brown MOVED to ADOPT AMENDMENT 5. Co-Chair
MacLean OBJECTED. A roll call vote was taken on the motion.
IN FAVOR: Brown
OPPOSED: Grussendorf, Navarre, Hanley, Martin, Parnell,
Therriault, MacLean, Larson
The MOTION FAILED (8-1).
Representatives Foster and Hoffman were not present for the
vote.
Representative Brown MOVED to ADOPT AMENDMENT 6 (Attachment
6). She MOVED to AMEND the Amendment to delete "originally"
and "insert or other assets". She stated that the amendment
to Amendment 5 would allow equipment obtained through state
grants to be sold. There being NO OBJECTION, it was so
ordered. Representative Brown MOVED to ADOPT AMENDMENT 5 as
amended. Co-Chair Larson spoke in support of the amendment.
There being NO OBJECTION, it was so ordered.
Co-Chair MacLean provided members with AMENDMENT 7
(Attachment 7).
(Tape Change, HFC 93-125, Side 1)
Mr. Fargnoli explained that Amendment 7 is a "housekeeping"
amendment which clarifies the definition of "local share".
Co-Chair MacLean MOVED to ADOPT AMENDMENT 7.
Co-Chair Larson asked who would be responsible for cost
overruns. Mr. Stastny stressed that each community has the
option of investing from their pool of funds. If a
community has money in their account the state would provide
a match at the same ratios.
Co-Chair MacLean referred to fiscal notes accompanying HB
124. Mr. Fargnoli discussed fiscal notes for the Department
of Community and Regional Affairs, Department of
Administration and municipal impact. He noted that matching
requirements will add to administrative costs in the
Department of Community and Regional Affairs.
Representative Navarre express concern that the departments
will not have sufficient personnel to administrator the
grants efficiently. He asked if Davis Bacon laws regarding
pay scale cause difficulties. Mr. Fargnoli assured him that
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Davis Bacon laws will not cause problems.
Representative Grussendorf asked if the Department of
Transportation and Public Facilities would be involved in
projects. Mr Fargnoli agreed that the Department of
Transportation and Public Facilities could be affected by
projects but did not anticipate increased budget needs.
Representative Foster MOVED to ADOPT the fiscal notes
associated with CSSB 88 (FIN) for as House Finance Committee
fiscal notes for HB 124. There being NO OBJECTION, it was
so ordered.
Representative Martin MOVED to report CSHB 124 (FIN) out of
Committee with individual recommendations and with the
accompanying fiscal notes. There being NO OBJECTION, it was
so ordered.
CSHB 124 (FIN) was reported out of Committee with "no
recommendation" and with a zero fiscal note by the House
Finance Committee and with two fiscal impact notes by the
House Finance Committee.
Representative Hanley expressed his desire to see
administrative costs deducted from the grant. Mr. Stastny
observed that overhead costs for the capital matching grants
are absorbed in the affected agencies' budget. Co-Chair
Larson agreed that increased agency costs should be included
in the grant process. He stressed that it is the
Committee's intent that costs be born by the grant program.
There being NO OBJECTION, CSHB 124 (FIN) was moved from the
Committee.
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