Legislature(2009 - 2010)CAPITOL 17
03/09/2010 01:00 PM House TRANSPORTATION
| Audio | Topic |
|---|---|
| Start | |
| HB329 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 329 | TELECONFERENCED | |
| + | TELECONFERENCED |
HB 329-DEDICATED TRANSPORT FUND/PUB TRANSPORT
1:08:23 PM
CHAIR P. WILSON announced that the only order of business would
be HOUSE BILL NO. 329, "An Act relating to the transportation
infrastructure fund, to local public transportation, to motor
fuel taxes, and to the motor vehicle registration fee; and
providing for an effective date."
CHAIR P. WILSON stated several hearings have been held on HB 329
and a new committee substitute has been developed that
incorporates many of the changes that the committee suggested.
1:08:41 PM
REPRESENTATIVE JOHNSON moved to adopt the proposed Committee
Substitute for HB 329 labeled 26-LS-1307\D, Kane, 3/5/10, as the
working document. There being no objection, Version D was
before the committee.
REPRESENTATIVE JOHNSON objected for the purpose of discussion.
1:08:55 PM
REBECCA ROONEY, Staff, Representative Peggy Wilson, Alaska State
Legislature, on behalf of the sponsor, explained three major
changes contained in Version D. She referred members to page 3,
lines 8-9, which would allow the appropriation of 50 percent of
the revenues deposited to the proposed dedicated transportation
fund (ATIF) to be spent each year in addition to the percent of
market value (POMV). This paragraph was changed to increase the
available appropriation annually to allow for bigger projects or
a greater number of projects funded in any given year.
Additionally, this provision was added in case the proposed ATIF
was not seeded with the anticipated $1 billion to capitalize the
fund.
1:10:18 PM
MS. ROONEY referred to a spreadsheet in members' packets dated
3/9/2010 titled, "Appropriation Estimates Spreadsheet." She
indicated the spreadsheet was prepared by the Department of
Revenue (DOR). She directed members to Scenario 2, and the
column labeled "Yearly Approp" which projects appropriations
from the proposed dedicated transportation fund based on Version
K of HB 329. The last column on the right, labeled "Total
Approp" lists the projected appropriation with the additional
revenue available each year. It is not mandatory to appropriate
all available funds each year so the legislature has the option
to retain the funds. She referred members to the ending
balances listed in the two scenarios. She pointed out that the
ending balance in Scenario 1, which was based on Version D lists
$900 million more than Scenario 2, which was based on Version K.
She explained the difference in the amounts represents the
tradeoff of completing more projects within the 20-year
timeframe.
1:11:46 PM
MS. ROONEY referred to page 4, lines 13-14, which would allow
the appropriations from the proposed ATIF to be used for the
operating costs of Division of Motor Vehicles (DMV). She noted
a mistake in the percentage listed in Version D, which reads one
percent but should be three percent. Thus, an amendment will be
offered for committee consideration. She remarked that during
this hearing someone from DMV will discuss the DMV figures.
1:13:10 PM
MS. ROONEY referred to page 4, lines 28-31, and page 5, lines
16-18, to the composition of the proposed Alaska Transportation
Infrastructure Fund Advisory Council (ATIFAC). She explained
that Version D would change the composition of the proposed
ATIFAC to 12 members, including 2 legislative members, the House
and Senate Transportation Committee Chairs; 6 DOT&PF members,
the three regional DOT&PF directors, three DOT&PF deputy
commissioners, and would add 4 public members, one from each of
the four judicial districts. The public member appointees would
be required to have substantial knowledge of transportation
issues and a familiarity with all transportation modes. The
public members would be appointed by the governor and serve
staggered terms.
1:14:42 PM
REPRESENTATIVE JOHNSON asked for a definition of extensive
experience and substantial knowledge.
MS. ROONEY said it was a "squishy" term at this point.
REPRESENTATIVE JOHNSON asked whether the committee could develop
a better definition.
MS. ROONEY explained that the language was modeled after the
definition Pennsylvania used for selecting members to serve on
its transportation commission. She offered to continue to work
on the definition.
REPRESENTATIVE JOHNSON asked what experience a person would need
to qualify to serve as a public member in the Pennsylvania
model.
MS. ROONEY offered that Pennsylvania board members had varied
experience, ranging from serving on business boards, as owner or
operators of major transportation companies, or specific job
training or experience related to transportation.
CHAIR P. WILSON commented that public members on the ATIFAC
would need to have extensive experience and knowledge in the
field of transportation or transportation of people and goods.
She stated the goal of acquiring public members with experience
that relates to transportation, airplanes, or ferries.
REPRESENTATIVE JOHNSON expressed concern over the term
"extensive experience" as he was not certain what that term
meant. He stated that if the term works in the state of
Pennsylvania, it should also work in Alaska. He envisioned that
if two people applied to serve on the ATIFAC, it is likely that
the most experienced person would likely be selected.
1:17:14 PM
REPRESENTATIVE MUNOZ referred to page 2, line 19 to the state
tax on fuel, and asked whether Version D would return a
percentage of revenue to municipal airports.
MS. ROONEY answered that Version D allows for the aircraft fuel
tax to be returned to the airports.
REPRESENTATIVE MUNOZ related her understanding that unless there
is an exception this paragraph would pertain to all aircraft tax
so it may be necessary to specify the tax that will be returned.
MS. ROONEY related that municipal airports would still receive
60 percent of aviation tax. She offered to ask the bill drafter
for additional information on the aviation taxes.
CHAIR P. WILSON recalled that a certain percentage is already
passed on to municipalities.
REPRESENTATIVE MUNOZ offered her belief that the language in
Version D encompasses all taxes on aircraft, unless another
provision addresses aircraft tax.
MS. ROONEY referred to page 2, line 20, and suggested that the
aircraft tax might be covered under the specific language "less
refunds."
REPRESENTATIVE JOHNSON related that this language is limited to
the fuel tax and not passenger facility charges (PFC), landing
fees, or other revenue sources at airports.
REPRESENTATIVE MUNOZ, in response to Ms. Rooney, thanked her for
noting the location that addresses aviation tax in Section 5,
page 5, line 32 of Version D.
1:20:26 PM
AVES THOMPSON, Executive Director, Alaska Trucking Association,
read his testimony as follows [original punctuation provided]:
Thank you. Madame Chair and members of the committee,
I am Aves Thompson, Executive Director of the Alaska
Trucking Association. The Alaska Trucking Association
is a state wide organization representing the
interests of our nearly 200 member companies from
Barrow to Ketchikan. Freight movement represents a
large chunk of our economy and impacts all of us each
and every day. The simple truth is that "if you got
it, a truck brought it."
One of the priorities of the Alaska Trucking
Association has been a state funded capital projects
program as federal funding is very likely to decrease
to a point where it will no longer meet Alaska's
transportation infrastructure needs. Alaska needs to
invest our dollars in our transportation system.
We believe that HB329 goes a long way to setting the
stage for a robust state funded capital projects
program that will benefit all motorists as well as
other users of other transportation modes.
As the largest payer of the motor fuel tax, the
trucking industry is glad to see an effort to devote
these user fees to the improvement and expansion of
our state highway system infrastructure. As an
association, we have supported fuel tax increase
proposals in the past, provided they are dedicated to
the highway system.
We understand that some changes will be made to the
makeup of the ATIF Advisory Board and are hopeful that
one of the members of that board will be from the
trucking industry. We are also hopeful that this
system will tend to de-politicize the decision making
process.
One additional concern is that there may be a tendency
to look to this fund to support more and more of the
state expenditures on our highway system. We are
hopeful that the ATIF appropriations will provide
additional funding as General Fund appropriations
continue to support a robust state capital projects
program. Simply put, if the ATIF is not an add on, it
won't accomplish its' purpose.
We believe the Transportation Infrastructure Fund has
the potential to supplement existing programs. Thank
you.
1:23:35 PM
CHAIR P. WILSON remarked that Mr. Thompson has presented a good
reason to consider adding someone from the trucking association.
REPRESENTATIVE JOHNSON asked whether a designee from the
trucking industry should be added, and if so, for guidance on a
definition to identify the trucking representative.
MR. THOMPSON agreed that the ATA would feel comfortable with
someone from the trucking industry to serve on the ATIFAC. He
suggested selecting a person from the motor carrier side of the
trucking industry, such as someone working with a major trucking
organization that operates on the statewide highway system.
REPRESENTATIVE JOHNSON offered the language might read a
representative from the ATA or their designee, as selected by
the ATA.
MR. THOMPSON agreed.
1:26:08 PM
MIKE GAULT explained that he is representing himself, although
he has 32 years of experience working in the highway
construction industry. He related that he has 20 years of
experience as a senior project engineer for the Central Region
of DOT&PF. He expressed his support for HB 329. He pointed out
that state-funded projects are less restrictive than federally
funded projects. Thus, the trend has been to use state funds
whenever possible on DOT&PF projects. He advocated for a
dedicated fuel tax for automotive and aviation fuel tax to fund
the proposed ATIF. He suggested that the proposed ATIF should
also be used for maintenance and not just for construction of
capital projects.
1:29:07 PM
CHAIR P. WILSON responded that the bill would deposit the motor
fuel taxes and vehicle registration fees to the proposed ATIF,
after some uses currently provided for are covered.
1:30:26 PM
COLLEEN SOBERAY, CH2M Hill, offered her company's support for HB
329. She offered his belief that HB 329 will augment
transportation funding needs while allowing the state better
control of projects. Federal funds are often necessary, but
come with stringent requirements that significantly delay
completion of projects. Additionally, federal dollars are
declining in Alaska. She explained that she attends several
out-of-state transportation conferences per year. Last year,
other states were "pointing the finger" at Alaska's federal
funding match compared to higher populous states. It was clear
to her there will be vocal opposition to continue high levels of
federal funding to Alaska. Still, a large gap exists between
Alaska's transportation needs and funding for projects. She
predicted that the gap will continue to grow. She asked how the
legislature will be able to address the growing gap in the
future. Transportation investment has been proven to be an
economic driver and a competitive advantage for states. Times
have changed, she said. Alaska prides itself in being "doers"
and "an owner state." Alaska is at a crossroads that requires
it to be creative and proactive with funding initiatives. This
bill represents proactive government and addresses multi-modal
transportation needs. Studies have shown that transportation
systems can help or hinder local economies. The ATIF is about
jobs and economies. The DOT&PF has about 3,400 employees as
compared to more than 71,000 transportation industry-related
jobs in Alaska, including jobs in the trucking industry. She
said, "I trust the legislature will finalize this bill,
providing for the details of the fund, control of the fund, and
appropriations of the fund." She urged members to support the
bill.
1:33:06 PM
MICHAEL MILLER, Granite Construction Company, stated that he has
worked in the construction industry for almost 37 years. He has
served as the past-president of the Associated General
Contractors of Alaska (AGC) as well as a member of the national
AGC's Western Association of State and Highway Transportation
Official's Committee. This bill recognizes the future, he
stated. Alaska can no longer characterize itself as "small,
poor, and remote." The Federal Highway Trust Fund is in
jeopardy and the new reauthorization will not be friendly to
rural states. Passing this bill is "a smart thing to do. It's
forward looking. It will create jobs and will benefit the
state's economy many times over." He suggested the committee
review the Alaska Municipal League's study January 2010, Alaska
Transportation Finance Study to obtain additional ideas.
1:35:26 PM
REBECCA LOGAN, President, Associated Builders and Contractors of
Alaska (ABC Alaska), related that ABC Alaska supports HB 329
since it creates the opportunity to depoliticize the decisions
surrounding transportation projects. Additionally, this bill
would create a dedicated funding stream for transportation
projects, contains a strong element of planning for the future,
and establishes criteria for selecting projects. She suggested
when selecting four public members to serve on the ATIFAC that
someone should be selected who has a construction background on
large infrastructure projects. She emphasized that firms that
work on the larger projects should participate by serving on the
ATIFAC.
1:36:42 PM
CHAIR P. WILSON, after first determining no one else wished to
testify, closed public testimony on HB 329.
1:37:14 PM
CHAIR P. WILSON referred to page 4, line 13, to an amendment in
members' packets.
1:38:26 PM
REPRESENTATIVE JOHNSON made a motion to adopt Amendment 1,
labeled 26-LS1307\D.1, Kane, 3/9/10, which read:
Page 4, line 13:
Delete "one"
Insert "three"
REPRESENTATIVE JOHANSEN objected for the purpose of discussion.
1:38:42 PM
REPRESENTATIVE JOHANSEN expressed concern with the allocation
listed in HB 329. He said he thought that placing the language
in statue may "tie the hands of the legislature" as the
appropriating body. He remarked that he did not wish to hold up
the bill. He then removed his objection.
CHAIR P. WILSON explained that Amendment 1 would affect
subsection (d) which read, "Not more than one percent..." Thus,
Amendment 1 would allow up to three percent to be appropriated
for the operating costs of the DMV. Additionally, Amendment 1
would actually limit the amount that can be spent and the DMV
would still need to justify its operating costs through the
budget process.
1:40:40 PM
REPRESENTATIVE JOHNSON referred to page 3, line 19, to language
that read "80 percent of the appropriations from the fund may be
used..." He pointed out that it does not read "must be used,"
which gives the department the flexibility to use up to 80
percent. However, the language does not require the legislature
to appropriate the entire 80 percent. He said he understood
Representative Johansen's concern, but thought this language may
"soften it a little bit."
REPRESENTATIVE JOHANSEN maintained his concern that the bill
caps the percentage, which may dictate how much can be
appropriated for each transportation mode.
1:42:05 PM
REPRESENTATIVE GRUENBERG also expressed concern. He said,
"Either authorizing or appropriating, there is only such a big
pie." He mentioned that one percent or three percent may not
seem like a lot, but he shared the concern that the allocation
is over 100 percent.
1:43:02 PM
WHITNEY BREWSTER, Director, Division of Motor Vehicles (DMV),
Department of Administration (DOA), explained the DMV's
operating and capital expenditures. The DMV's operating funds
are funded through receipt supported services (RSS), which means
the DMV "lives off" its receipts and surpluses are deposited to
the general fund (GF). The DMV goes through the normal
budgetary process and the legislature authorizes its
expenditures, but the funding source is from RSS. She referred
the committee to a spreadsheet in members' packets titled,
"Division of Motor Vehicles, Revenues, and Expenditures." She
explained the DMV funding process by referring members to FY 11,
to the projected revenues of $64,356,300. She stated that
roughly $12 million is currently collected on behalf of other
entities, such as the Motor Vehicle Registration Tax which is
collected for local cities. She remarked that $37,415,900
represents the vehicle registration fees collected, which is
designated for the ATIF. The remaining revenue is derived from
fees collected, including from drivers' licenses, license
plates, identification cards, specialty vehicle plates, and
motor vehicle titles. The DMV currently retains a certain
portion of the Motor Vehicle Registration Tax for its
operations. She turned to the DMV Expenditures, which
identifies the RSS operating expenses for FY 11 at $16,286,000.
1:46:25 PM
MS. BREWSTER related that since the DMV collects less than the
anticipated fees collected, it will have shortfalls. The DMV
advocates for enough funds to operate the DMV. She anticipated
that the three percent appropriation under consideration in
Amendment 1 would likely be sufficient for FY 2012. However,
she projected a shortfall would exist for the DMV, which could
result in the DMV require supplemental funding since two-thirds
of the DMV's budget covers personal services. She estimated
that in FY 10, a potential shortfall exists in the amount of
$9.2 million. She offered the DMV's support for the bill but
expressed concern over that the bill caps the percentage of the
appropriation to cover the DMV's operating expenses.
1:48:27 PM
CHAIR P. WILSON recalled earlier discussions on this matter.
She related that the next committee of referral is the House
Finance Standing committee, which would be an appropriate
committee to review the budgetary impact for the DMV.
1:49:02 PM
REPRESENTATIVE JOHNSON inquired as to whether the DMV projected
a $9 million deficit in 10 years.
MS. BREWSTER agreed with the projected deficit amount.
REPRESENTATIVE JOHNSON asked what percentage was used to project
the $9 million deficit.
MS. BREWSTER answered that the figure used was a three percent
increase per year. She explained that the DMV attempts to
contain its costs, but with two-thirds of its budget consisting
of personal services, the DMV does not have much control.
REPRESENTATIVE JOHNSON asked whether the DMV submitted a ten-
year plan to the finance committee.
MS. BREWSTER said she was not certain. She offered to follow-up
after the meeting. She stated that the three percent used
represented an estimate.
REPRESENTATIVE JOHNSON expressed interest in the DMV's projected
budget.
MS. BREWSTER offered to provide the budget documents. She
remarked that the DMV requested a budget decrement this year and
the DMV is conscious of its budget and "pays close attention" to
costs.
1:51:11 PM
REPRESENTATIVE JOHANSEN referred to FY 11 and projected revenues
of $64 million on the DMV's spreadsheet. He commented that $12
million is collected on behalf of other entities and $37 million
would be deposited into the proposed ATIF.
MS. BREWSTER answered yes, that $37 million would be deposited
to the ATIF.
1:52:03 PM
REPRESENTATIVE JOHANSEN asked if the DMV would have $14.9
million remaining in revenue, but anticipated $26 million in
expenditures.
MS. BREWSTER responded that the DMV's operating costs are
projected at $16.2 million in RSS, but adding in the anticipated
capital expenditures, the total expenditures for FY 11 are
anticipated at $26 million and revenues of $14.9 million.
CHAIR P. WILSON pointed out that the fiscal note reflects $2.5
million per year for FY 2011-FY 2016.
MS. BREWSTER, in response to Representative Johansen, stated
that the $37 million in fees collected by the DMV are deposited
to the state's general fund.
REPRESENTATIVE JOHANSEN commented that currently the DMV is a
"money maker."
MS. BREWSTER answered yes.
There being no further objection, Amendment 1 passed.
1:54:58 PM
The committee took an at-ease from 1:54 p.m. to 1:55 p.m.
1:55:45 PM
REPRESENTATIVE GRUENBERG asked whether the committee would like
to set out maximum percentages for allocation to transportation
modes or leave the categories listed but to not assign any
percentages. For example, he expressed interest in increases to
public transportation in his district. He restated that the
committee could list transportation categories, but not assign
percentages.
REPRESENTATIVE JOHANSEN related that he would be comfortable
moving the bill on to the House Finance Standing Committee to
work on the allocation issue.
CHAIR P. WILSON recalled during public testimony the Alaska
Trucking Association (ATA) and major construction industry
representatives asked for participation on the ATIFAC. She
referred to page 5 to the composition of ATIFAC, which she
offered as a substantive rather than financial consideration.
REPRESENTATIVE JOHANSEN agreed.
REPRESENTATIVE GRUENBERG asked to discuss percentages of
allocation.
CHAIR P. WILSON asked to first consider the composition of the
ATIFAC.
1:59:43 PM
REPRESENTATIVE T. WILSON related that the proposed four public
members could accommodate the ATA and construction industry
participation. She said she thought the current proposed ATIFAC
is good.
REPRESENTATIVE JOHANSEN agreed. He said he thought that many
user groups would be interested in participating and the four
public members should suffice.
REPRESENTATIVE JOHNSON offered his belief that it would be a
good idea to have the two additional user groups serve on the
proposed ATIFAC.
CHAIR P. WILSON asked for the committee's interest in the
ATIFAC.
2:01:49 PM
REPRESENTATIVE JOHNSON offered Conceptual Amendment 2 to add one
member of Alaska Trucking Association and a member of the
construction industry that works on infrastructure to serve on
the proposed ATIFAC.
REPRESENTATIVE JOHANSEN objected.
REPRESENTATIVE T. WILSON pointed out that the public member
appointments would be made by the governor. She speculated that
the state's overall needs may change. She suggested the
committee not specifically assign the public members to sectors,
and simply allow the appointment process to work.
2:03:32 PM
REPRESENTATIVE JOHNSON related that one member of the ATIFAC
should be an ATA member who uses the road on a daily basis, but
the construction of the infrastructure position could be a
person who works for the AMHS or the Ketchikan shipyard. He did
not envision the transportation infrastructure designee would
exclude anyone involved in major transportation issues.
Designating someone who works on major infrastructure places
someone actively involved in transportation construction on the
ATIFAC, he stated. He said he thought that person would bring
extensive knowledge to the process.
REPRESENTATIVE PETERSEN pointed out that 12 members on the
proposed ATIFAC would likely bring a wide variety of backgrounds
to the council. He also agreed it was not necessary to specify
individuals from transportation sectors to serve as public
members.
2:05:22 PM
REPRESENTATIVE JOHNSON withdrew Conceptual Amendment 2. He
maintained that his concern is primarily over the "extensive
experience" language in the bill.
REPRESENTATIVE JOHNSON expressed concern about the two members
of the legislature being appointed to an administrative body.
He reported his own experience with the AMATS. He recalled a
suggestion at a prior meeting.
REPRESENTATIVE JOHANSEN made a motion to adopt Conceptual
Amendment 3, on page 4, lines 29-30, that the two proposed
legislative members selected to serve on the ATIFAC be severable
from the bill. He stated that he did not want the entire bill
to "go down" if the membership participation is found to be
unconstitutional.
REPRESENTATIVE T. WILSON objected.
REPRESENTATIVE GRUENBERG explained severability clauses. He
stated current statutes contains a general severability clause,
for example, if any provision in a bill is unconstitutional, the
presumption is the rest of the bill would not be considered
unconstitutional. He further stated that separate severability
language would rarely be put in the bill itself, although it
could be included. He said he did not have an issue in doing
so, but normally severability would apply to the entire bill.
He asked whether Representative Johnson's intent was that the
severability would apply only to the specific ATIFAC provision.
REPRESENTATIVE JOHNSON responded that his specific concern
surrounds the history of legislators being removed from boards
due to the separation of powers issue. He did not object to the
severability clause applying to the whole bill. However, he
wanted to be clear that he did not wish HB 329 to "go down" if
the legislature appointments to the ATIFAC were found to be
unconstitutional.
2:09:01 PM
REPRESENTATIVE GRUENBERG suggested other constitutional issues
could arise. He offered his belief that Representative Johnson
would like a severability clause added at the end of the bill.
REPRESENTATIVE JOHNSON pointed out that Conceptual Amendment 3
conceptual so it would be up to the bill drafter to decide the
specific placement.
REPRESENTATIVE GRUENBERG restated that normally a separate
section would add a severability clause.
2:10:13 PM
REPRESENTATIVE PETERSEN recalled the possibility of making the
chairs of the House and Senate Transportation committees as non-
voting members on the proposed ATIFAC and asked whether that
could solve the problem.
REPRESENTATIVE JOHNSON reported that he previously was appointed
as a non-voting member serving on AMATS, but the court ruled he
was not eligible to serve and prohibited him from serving being
on the board. He further recalled that he was strictly an ex-
officio member and recalled his situation was similar to this.
CHAIR P. WILSON restated Conceptual Amendment 3.
REPRESENTATIVE JOHANSEN offered that he supports Conceptual
Amendment 3, but since the bill is subject to general
severability provisions, he did not believe the provision was
specifically needed.
REPRESENTATIVE JOHANSEN removed his objection. There being no
further objection, Conceptual Amendment 3 was adopted.
2:12:39 PM
REPRESENTATIVE JOHNSON moved to report HB 329, Version 26-
LS1307\D, Kane, 3/5/10, as amended, out of committee with
individual recommendations and the accompanying fiscal notes.
There being no objection, CSHB 329(TRA) was reported from the
House Transportation Standing Committee.
2:13:09 PM
CHAIR P. WILSON applauded the committee as being proactive. She
related that needs and funding gaps exist throughout the state.
The proposed dedicated transportation fund, ATIF, is important
in order for economic and resource development to happen. She
pointed out that the founders of the Alaska Constitution
grandfathered in two dedicated funds and one was for
transportation. Thus, this bill is not contrary to action taken
by the drafters of the constitution. Passing this bill could be
a big step for Alaska to move forward economically since
transportation has been proven to be an economic driver. She
thanked members for their work.
REPRESENTATIVE JOHANSEN commented on the great process and
commended the committee's staff. He said he was glad that the
sponsor was open to suggestions. He offered his belief that the
best thing the crafters of the state's constitution did was to
allow for a process to make changes to the constitution. In
1955, a computer with the ability of our current computers would
have taken up an entire warehouse.
2:16:46 PM
| Document Name | Date/Time | Subjects |
|---|---|---|
| HB329 Ver D.pdf |
HTRA 3/9/2010 1:00:00 PM |
HB 329 |