Legislature(2009 - 2010)HOUSE FINANCE 519
04/11/2010 12:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB296 | |
| HB416 | |
| HB421 | |
| SB199 | |
| HB424 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | HB 296 | TELECONFERENCED | |
| + | HB 416 | TELECONFERENCED | |
| *+ | HB 421 | TELECONFERENCED | |
| += | HB 424 | TELECONFERENCED | |
| + | SB 199 | TELECONFERENCED | |
| + | TELECONFERENCED |
HOUSE BILL NO. 424
"An Act providing for and relating to the issuance of
general obligation bonds in a principal amount of not
more than $1,000,000 for the purpose of paying the
cost of education projects for public schools and the
University of Alaska; and providing for an effective
date."
6:26:02 PM
Co-Chair Hawker MOVED to ADOPT CS HB 424(FIN) Work Draft
26-LS1649\P as a working document before the committee.
Co-Chair Stoltze OBJECTED for discussion.
JAMES ARMSTRONG, STAFF, REPRESENTATIVE BILL STOLTZE,
explained the CS. He stated that HB 424 is a request for a
$384.2 million general fund bond authority and if adopted
would be sent to voters for the November 2010 general
election.
Mr. Armstrong presented a brief summary of the legislation
by section:
· Section 1, specifies the amount of the bond.
· Section 2, contains the education project fund. He
added that is the standard language for bond bills.
· Section 3, relates to the Mount Edgecombe High
School aquatic facility in Sitka and the State
Library Archives and Museum facility in Juneau that
will be bonded in the amount of $20 million for each
project ($40 million total).
· Section 4, identifies three school replacements and
renovations in western Alaska for a total of $128.5
million.
Co Chair Stoltze interjected that these three schools are
referred to as the Kasayulie Schools in reference to the
lawsuit and eventual judgment that lead to changes in rural
school funding.
Mr. Armstrong continued the sectional presentation with:
· Section 5 identifies the University of Alaska's
Valley Center for Art and Learning on the Matanuska
Susitna (Mat-Su) Campus, the Community Arena and
Athletic Center in Anchorage, the Life Science
Classroom in Fairbanks, two projects for the Kenai
Campus's student housing and Career and Technical
Education Center and the Prince William Sound
Community College campus renovation and renewal.
Total $161.8 million.
· Section 6 identifies the Department of Fish and
Game's Near Island Research facility {$20 million)
in Kodiak.
· Section 7 names the Department of Commerce,
Community and Economic Development grants for a
total of $33.9 million. He noted the list of
projects begin on page 4, of the legislation. The
first seven projects are for library construction in
Anchorage, Cordova, Kenai, Mat-Su, North Slope,
Petersburg, and Seward. The eighth and ninth
projects are located on Prince of Wales Island for a
vocational education center in Klawock and the
Northwest Magnate School and Kotzebue High School in
the Northwest Arctic Borough.
· Section 8 appropriates the cost of issuing the bond
per the Department of Revenue; total $4,610.400.
6:30:14 PM
Mr. Armstrong noted that the bonds were eligible under the
Build America Bond Act as part of the federal stimulus
program (ARRA); the bonds would need to be sold before
December 31, 2010. Upon voter approval the federal
government will pay thirty five percent of the interest
over the twenty year life of the bond.
JERRY BURNETT, DEPUTY COMMISSIONER, DIVISION OF TREASURY,
DEPARTMENT OF REVENUE, clarified that the program was
extended through December 2011.
Representative Doogan asked if the identified projects were
pieces of projects rather than whole projects. Mr.
Armstrong replied that only two University of Alaska
projects (projects two and three) were funded in portions,
their balance will be included in the capital budget as
general funds. In the event the bonds are not adopted by
voters the two projects would move forward with previously
appropriated cash on hand; $25 million for an arena on the
Anchorage Campus and $38 million for a life sciences center
for the Fairbanks campus.
Co-Chair Stoltze interjected that $20 million of the
existing funds are comprised of University revenue bonds.
6:34:07 PM
Co-Chair Hawker announced that not all of the bond projects
in HB 424 are for entirely new facilities. Many of the
projects such as the Northwest Magnet School and library
projects are for renovations, improvements, etc. He
cautioned against creating public misperceptions.
Mr. Armstrong mentioned that the library projects on page 4
were currently included in the Senate's version of the
capitol budget and if approved as part of the bond package,
it was the intent of the chair to remove them in the House
version.
Representative Doogan asked for more information about the
Near Island Research Facility listed in Section 6.
Representative Austerman explained that it will be located
in Kodiak next to the National Oceanic and Atmospheric
Association (NOAA) and the University's Fishery and
Technology Center buildings. The facility will house
Department of Fish and Game offices, research, and
educational facilities.
6:38:14 PM
Representative Gara cited the university projects on page
3, line 8, and asked what the regent priorities were. Co-
Chair Stoltze stated that projects number 2 (Community
arena and athletic center) and 3 (Life Science Classroom
and laboratory building) were regents priorities. The other
projects have been on the regents lists in the past.
Mr. Armstrong pointed out that all of the ten previous bond
propositions put forward to voters since statehood had been
approved.
Representative Foster underscored the importance of
resolving the Kasayulie case and contended that the three
school projects were a positive step. He reported that the
Alakanuk School was two hundred and twenty percent over
capacity.
Co-Chair Hawker relayed that the three school projects in
HB 424 were the three top schools by ranking on the school
construction list prepared by the Department of Education
and Early Development. Mr. Armstrong affirmed.
Representative Gara asked if any projects in HB 424 are
included in the Senate version of the capital budget bill.
6:41:36 PM
Mr. Armstrong listed the seven library projects on page 4,
lines 1-12, that are in the Senate version of the capital
budget: Loussac Library, Anchorage; Cordova Center and
Library Cordova; Community Library expansion Kenai;
Sutton Community Library and Resource Center, Matanuska-
Susitna ; Tuzzy Library expansion, North Slope; Public
Library, Petersburg; Community library ,Seward.
Co-Chair Stoltze closed public testimony.
Mr. Armstrong cited that the Department of Revenue's fiscal
note accompanying the legislation depicts the sum of
$29,095,000 in expenditures for the out years FY 2012
through FY 2016. The amount will be decreased in a revised
fiscal note to $28,773,000.
6:46:08 PM
Representative Doogan asked if the intent was to find
complete funding for the two projects that would only be
partially funded by the general obligations bonds, before
the end of session. Co-Chair Stoltze affirmed.
Representative Gara requested to hear from the university
regarding the university projects. He wondered if the
university was in support of the list.
6:49:34 PM
WENDY REDMAN, VICE PRESIDENT, STATEWIDE PROGRAMS,
UNIVERSITY OF ALASKA, responded that the university
supported the projects. She noted that the Life Sciences
facility in Fairbanks was the major priority for the
university this year. The other projects were on campus
priority lists.
Representative Gara inquired about the university's
priority for funding for engineering buildings. Ms. Redman
replied that the university requested $10 million for
planning engineering facilities for the Anchorage and
Fairbanks campuses. She reported that the request was not
included in the governor's budget. They were considered the
most important projects that the university wanted to move
forward after the Life Sciences building. The Senate
included $5 million in the capital budget for the Anchorage
engineering facility and nothing for Fairbanks.
Co-Chair Stoltze suspected that all the bond projects were
on the regents' list at some point.
6:53:14 PM
Representative Gara voiced frustrations with the shortage
of university housing in Anchorage. He felt that more
housing at the main campuses of Anchorage, Fairbanks, and
Juneau would create a vibrant, statewide university system.
Ms. Redman reported that the university created a committee
to work on housing in collaboration with AHFC to facilitate
the project and to expect a plan to come before the
legislature in the near future.
Representative Fairclough reported that she had two boys at
the University of Alaska in Fairbanks, in order to avoid
any conflicts of interest.
Representative Gara inquired if the $20 million Department
of Fish and Game Near Island facility was a state priority.
Representative Austerman explained that the project was the
top priority on the capital improvement list for the City
and Borough of Kodiak.
Representative Gara wondered if it was a priority for the
Department of Fish and Game. Representative Austerman was
not certain.
6:58:51 PM
Representative Fairclough spoke in support of the "Build
America Bond" projects. She commented that projects had to
be chosen that met the requirements of the program. She
voiced that she supported the legislation and liked the
concept of the thirty five percent interest payback. She
believed the package helped the state save money on these
projects.
Representative Salmon wondered if the bond package amount
was going to grow. Co-Chair Stoltze stated that he did not
think the amount could grow. He felt that there was a limit
to the debt threshold the voters would approve. He stated
that the legislature would act responsibly and leverage the
available federal money over a fair geographical balance in
the state according to the constraints of the bond program.
Representative Gara thought that there has been a lot of
criticism of the federal government within the state but a
readiness to accept federal funds. He pointed out that the
bill was an example of something the President has done
that was getting people back to work.
7:02:28 PM
Co-Chair Hawker MOVED to report CSHB 424(FIN) out of
Committee with individual recommendations and the
accompanying fiscal note.
CSHB 424(FIN) was REPORTED out of Committee with a "do
pass" recommendation and with attached new fiscal note by
the Department of Revenue.