Legislature(2019 - 2020)SENATE FINANCE 532
05/03/2019 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB19 | |
| SB34 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | TELECONFERENCED | ||
| += | SB 19 | TELECONFERENCED | |
| += | SB 34 | TELECONFERENCED | |
SENATE BILL NO. 19
"An Act making appropriations, including capital
appropriations, supplemental appropriations,
reappropriations, and other appropriations; making
appropriations to capitalize funds; and providing for
an effective date."
9:04:53 AM
Co-Chair von Imhof relayed that the committee had heard the
bill on March 12, 2019, at which time public testimony had
been taken.
Co-Chair Stedman MOVED to ADOPT proposed committee
substitute for SB 19, Work Draft 31-GS1904\K (Caouette,
5/2/19).
Co-Chair von Imhof OBJECTED for discussion.
9:05:55 AM
SHAREEN CROSBY, STAFF, SENATOR NATASHA VON IMHOF, discussed
the changes to the bill. She stated that when evaluating
projects, the priorities of the capital budget were to
maximize federal match, ensure health and safety, determine
reasonable deferred maintenance, and protecting access to
resources through bridges, roads, airports, and ports. She
discussed the changes to the legislation and highlighted
the following appropriations in the bill:
Page 2, Line 16
Department of Commerce, Community and Economic
Development
Alaska Energy Authority Rural Outdoor Lighting
Efficiency Retrofit
$1,000,000 GF
Page 2, Line 19
Department of Commerce, Community and Economic
Development
Alaska Railroad: Seward Dock Replacement
$3,100,000 GF
Page 2, Line 24
Department of Commerce, Community and Economic
Development
Alaska Travel Industry Association (ATIA)
$7,420,000 GF
Ms. Crosby said that Page 3 reflected funding for the
Alaska Marine Highway System (AMHS) and additional small
district grants.
Ms. Crosby continued with the line items:
Page 4, Line 13
Department of Corrections
Juneau Lemon Creek Correctional Center Laundry
Expansion
$420,000 GF
Ms. Crosby noted that intent language had been added on
Page 5, Line 30, to allocate up to $2,000,000 of Pittman-
Robertson federal funds for agreements with nonstate
entities, the Alaska Mental Trust Authority, and local
governments that provided the required federal match for
eligible Pittman-Robertson projects.
Ms. Crosby continued with the line items. Page 6, line 12
included $47,600,000 for statewide deferred maintenance.
She noted that the monetary request was the same as the
governors, but the fund sources had been changed. Line 18
was a state match of $500,000, for federal funds that went
directly to the Code Blue Project.
9:11:13 AM
Ms. Crosby continued to address the changes to the bill.
Line 29 listed $2,500,000 for the Arctic Strategic
Transportation and Resources and was the same as the
governors request. She relayed that Page 7, line 17,
reflected the addition of $120,000 for the Jonesville
Public Use Area Management Plan, specifically, for
detailing the expenditure and scope of the work from the
Department of Natural Resources. She furthered that Line 32
reflected receipts of $250,000 from snowmobile
registrations for the Snowmobile Trail Development Program.
Page 8, line 3, showed $2.5 million for the South Denali
Visitors Center, which was 10 percent of the governors
total request. Line 5 reflected the addition of $1.4
million in federal funds for the Specialty Crop Grant for
Peony Research. She said that Line 20 listed the addition
of $1 million for the Alaska Housing Finance Corporation
(AHFC) Cold Climate Housing Research, Line 24 showed $5
million in GF and $2 million in other funds for AHFC Energy
Programs Weatherization. Page 9, Line 8, listed the
addition of $1.75 million for AHFC Teacher, Health, and
Public Safety Professional Housing. She relayed that Line
13 and 16 added funds for AMHS, $3 million and $13.5
million, respectively. She shared that Line 26 showed a
reduction of $2.5 million, down to $12.5 million, with
intent language encouraging the department to improve
standard operating procedures for fleet management.
9:14:24 AM
Senator Olson considered the $2.5 million decrease for
fleet management. He asked whether the decreased funds were
federal funds.
ROB CARPENTER, ANALYST, LEGISLATIVE FINANCE DIVISION,
stated that the funds were comprised of collected fees from
all agencies for the rental and leasing of state equipment.
9:15:09 AM
Ms. Crosby continued to address the changes to the bill.
She spoke to Page 10, line 4, which were $60 million, which
came back in $690 million federal match. She said that $25
million had been added in the CS and was a fully funded
match to maximize the federal highway funds. She remined
the committee that the funds had been changed from the
governors reappropriation from the M/V Tustumena. She said
that intent language had been added to Lines 9 and 20,
requesting a quarterly report form the Department of
Transportation and Public Facilities (DOT&PF) on projects.
Ms. Crosby addressed Page 11, line 13, pertaining to
University deferred maintenance. She said that the
governors original request had been increased from $5
million to $10 million; the current UA deferred maintenance
backlog was $1.2 billion.
Ms. Crosby addressed page 12, which reflected the funding
sources, by agency, for Section 1.
Ms. Crosby looked at Section 4 on page 17, which included
FY 19 Supplemental Capital Projects requested by the
governor.
9:17:32 AM
Co-Chair Stedman informed the public that in an effort to
maintain a positive working relationship with the
administration, the legislature had extended the governor's
deadline for submitting budget amendments.
9:18:18 AM
Senator Bishop appreciated that funds had remained in the
bill for the Statewide Per- and Polyfluoroalkyl Substances
Response.
9:18:43 AM
Ms. Crosby addressed Sections 5 and 6 on pages 19 and 20,
which listed fund sources for Section 4. She spoke to
Section 7, which was the Department of Corrections (DOC)
Inmate Health Supplemental for $3 million, requested by the
governor. Section 8 contained standard language for RPLs or
receipts. Section 9 contained standard language for
agencies to collect and expend insurance claims. Line 20,
Section 10 contained national Petroleum Reserve Alaska
Impact Grant Program language for FY 19 and FY 20.
Ms. Crosby looked at page 24 of the CS, Sections 11 and 12.
Section 11a was a $200,000 grant for earnings from the
Exxon Valdez oil spill restoration fund to the Prince
William Sound Science Center. Section 11b was $125,000 in
lapsing cruise funds going to the Railroad Seward Dock
Planning.
Ms. Crosby addressed 12a, which was a $125,000 supplemental
reappropriation requested by the governor for abandoned
school site assessments. She said that 12b stated that the
proceeds from the sale of Department of Education and Early
Development (DEED) state-owned land in Sitka received
during the fiscal years ending June 30, 2020, June 30,
2021, and June 30, 2022, are to be allocated to Mt.
Edgecumbe boarding school. state-owned lands sold in Sitka
9:21:02 AM
Co-Chair Stedman clarified that the lands were held by DEED
for the boarding school and if the properties were sold,
the benefit should be for the school.
9:21:52 AM
Ms. Crosby addressed Page 25, line 10; which combined the
request for troopers, wildlife troopers, and VPSO equipment
into one appropriation of $659,958,000.
Ms. Crosby moved to Page 26, Section 14a - sale of any AMHS
assets went to the AMHS Vessel Replacement Fund. She said
that 14b stated that reappropriation of $1.6 million in
completed project harbor project funds would be returned to
the harbor facility matching grant fund. Section 15 was the
governor requested, late amendment, for receipt authority
for the Alaska Gasline Development Corporation (AGDC), not
to exceed $25 million.
9:23:07 AM
Senator Wielechowski was curious about the statutory
designated program through which the Department of
Environmental Conservation (DEC) could receive up to $25
million.
Co-Chair von Imhof did not know the exact program but did
know that this item had been seen over the years. She
believed that the receipt authority was to finish the
Federal Energy Regulatory Commission (FERC) process. She
said that large oil companies that were doing business in
the state were interested in seeing the FERC process meet
completion. The analysis had shown that an additional $25
million for the next 18 to 24 months in order to finish the
analysis and permitting.
Senator Wielechowski had no problem with the completion
with the FERC process but was curious of the fund source
for the appropriation.
Mr. Carpenter stated that the cited fund source was the
statutory designated program receipts, which included third
party, non-state. Non-federal receipts coming to the state.
9:24:40 AM
Co-Chair Stedman recalled that there were hundreds of
millions of dollars invested in the FERC permit, which held
value even if there was no project. He wondered whether a
financial summary of the cost to the state could be
provided to the committee.
Co-Chair von Imhof added that Mr. Carpenter could request a
short summary from AGDC of the cost of the FERC process and
what timeframe that was expected for completion.
9:26:38 AM
Senator Hoffman thought that the timeframe for completion
of the process was critical information.
9:26:55 AM
Ms. Crosby relayed that she had notes from AGDC:
• Senate proposes very limited receipt authority to
permit AGDC to accept $25 million of third-party
money to help complete defined tasks at hand; very
narrow proposal versus last years denied request
for unlimited receipt authority.
• Should AGDC successfully attract third-party
funding, it sends a very powerful market signal that
Alaska LNG is on the right course.
• AGDC taking very measured approach to Alaska LNG
project, focusing on FERC permitting and partner
engagement so the state does not have to pay, build,
run Alaska LNG.
• AGDC will continue to consult with legislature at
every decision point along the way.
• There is no loss of project control to the state at
this funding level.
• The third-party funding would allow AGDC to extend
remaining funds further and off-set the need for any
additional state funds at this point when the state
is in a budget crunch.
9:28:08 AM
Co-Chair Stedman pointed out that Alaska Oil and Gas
Conservation Commission (AOGCC) was the regulatory body;
and just because an entity received a permit did not mean
that there was a project. FERC could issue multiple LNG
export permits across the country but that did not
guarantee that a project would be built. He
9:28:53 AM
Ms. Crosby continued to page 27 and addressed Section 16
pertaining to the District 10 library reappropriation to
another library in the same district. Section 17 was the
scope change of the project in District 35-36. Section 18
was the reappropriation of the Office of the Governors
lapsing funds back to their office, as requested. She added
that the word redistricting had been added to the langue
to accommodate census language in the section.
9:29:41 AM
Senator Wielechowski spoke to Section 18, lines 27-30:
estimated balance of $1,100,000, are reappropriated
to the Office of the Governor for capital costs
relating to advancing the governors initiatives,
including elections voting system replacement and
security, and state government efficiency and
consolidation initiatives.
Senator Wielechowski asked whether there was more detail
available about the aspects of the section.
Ms. Crosby stated that there were election systems that
needed upgrades. She offered to get more information from
the administration.
Senator Wielechowski was interested to understand what kind
of voting system replacement and security was being
purchased.
Co-Chair von Imhof echoed Senator Wielechowskis request
for more information on Section 18.
9:30:47 AM
Senator Micciche recalled that there had been an increment
denied in the Operating Budget that was being covered by
reappropriations in the Capital Budget. He stressed that
these were not additional funds but unexpended funds from
the past.
Ms. Crosby agreed.
9:31:22 AM
Senator Shower spoke to his understanding of the states
election system. He shared that the director of the
Division of Elections had testified that the division was
currently under a bid for proposals.
9:31:54 AM
Senator Wielechowski was curious about the items listed in
the beginning of Section 18. He wondered why the money was
not being spent on what had been previously authorized.
Ms. Crosby agreed to provide the information later.
9:32:38 AM
Ms. Crosby moved to page 28, Section 19; pertaining to
reappropriation of Legislative funds back to the
Legislature for Legislative Capital Projects. Section 20
pertained to the Alaska Housing Capital Corporation. She
detailed that her office had met with every agency and had
scrubbed any lapsing funds. She stated that due to the
fiscal situation, it was decided that all lapsing funds
would go into one fund entitled, the Alaska Housing Capital
Corporation Fund, where the funds would remain until FY
2020.
Co-Chair von Imhof detailed that the reason for the fund
movement was due to the long list of reappropriations. She
said that time constraints prevented the legislature to
reappropriate them individually; the additional time would
allow the legislature to plan for FY 2020 and reappropriate
equivalently across projects while also knowing the final
balance.
9:34:42 AM
Senator Micciche was curious about the Sterling Highway
road widening (Page 31, line 29). He noted that the road
was very busy in the summer and assumed that before the
funds were swept that a status of the project had been
investigated and that DOT had agreed that the funds were
not needed in the immediate.
Ms. Crosby stated that all funds that were lapsing had been
approved by the respective agencies.
9:35:42 AM
Senator Bishop thought some of the projects dated back to
2007 and could be closed out.
Co-Chair von Imhof stated all projects would be closed by
Juneau 2019, and had been approved by their respective
agency.
9:36:20 AM
Senator Wielechowski requested more information concerning
Page 30, line 12 and Page 31, line 25, which were
reappropriations that effected his district.
9:36:47 AM
Senator Shower expressed concern for the combining of
appropriations on Page 25, line 10. He said that he would
be monitoring the issue.
9:37:46 AM
Co-Chair von Imhof reminded that the committee was
discussing $5.4 million that could be reappropriated as
general funds, matching funds, or to give districts funds
for playgrounds, parks, etc. She stressed that by putting
the funds into a big slush fund, it was possible ensure
that all districts received the same amount; or, an
argument could be made line by line. She asserted that
those discussions would occur in the next legislative
session.
9:38:49 AM
Co-Chair Stedman explained that conversations had occurred
with the other body concerning how to deal with the funds.
He thought the proposed action was the fairest way handle
the funds at this time. He emphasized that accounting would
ensure that information on the genesis of the project funds
was known. He stated that the action was to close out all
the old projects around the state and move forward.
Co-Chair von Imhof added that school bond debt
reimbursement was still on a hiatus. She suggested that the
$5.4 million could come in handy for school debt
renovation. She believed that waiting a year to revisit how
the money should be spent was prudent.
9:41:24 AM
Senator Micciche appreciated Co-Chair von Imhof's approach
on the matter.
9:41:56 AM
Senator Olson asked whether any of the $5.4 million balance
included lapsing grants by Department of Commerce,
Community and Economic Development.
Mr. Carpenter informed that some of the funds included
lapsing grants. He could not speak to the amount.
9:42:31 AM
Ms. Crosby agreed to provide Senator Olson with an amount.
She addressed Section 21 of the bill, which covered lapsed
provisions. Line 19 of Section 22 was the retroactivity
clause. Section 23 through 25 contained effective dates.
Ms. Crosby referenced a document entitled "Multi-year
Agency Summary - FY 2020 Senate Structure" (copy on file).
9:43:42 AM
Senator Hoffman asked about the specificity of the
effective date.
th
Mr. Carpenter said that May 15 had been chosen in
anticipation that it would be the last day of the
legislative session.
9:44:15 AM
Senator Wielechowski asked for more detail on the ASTAR
project, Page 6, lines 29 and 30. He wanted to know how
much had been appropriated and how the money had been
spent.
Ms. Crosby was happy to provide additional details to
Senator Wielechowski.
Co-Chair von Imhof recalled that the project was a way to
connect the North Slope communities with broadband.
9:45:12 AM
Senator Olson recalled that there was a commercial impetus
to move the project forward.
Co-Chair von Imhof thought some of the guiding principles
of the capital budget had been not only health and safety,
but connecting Alaskans to each other, and providing access
to healthcare, education, and resources. She felt that the
ASTAR project embodied those principals.
9:45:56 AM
Senator Wielechowski asked about the South Denali Visitors
Center, Page 8, lines 3 and 4. He wanted more information
about how the funds would be used. He wondered whether the
state would assume ownership or receive financial benefit
from the investment.
Co-Chair von Imhof stated that request was intended to get
the project started and begin planning. She thought it was
dependent upon the level of the state's involvement in the
future. There was an expectation that a fee would be
charged at the center. There was a lot of pressure on the
Denali park and another entrance closer to Anchorage could
relieve some of that pressure. She reiterated that the
project was in the planning stages.
9:47:32 AM
Senator Bishop thought there was a goal to fund the
Division of Parks and Outdoor Recreation entirely through
designated general funds.
9:48:02 AM
Ms. Crosby noted that the Legislative Finance Division
would have capital budget reports posted to their website.
She relayed that the statewide total for the budget was
$1,385,715,700. The UGF total was $172,086,300; DGF total
was $55,112,000; other funds totaled $114,491,300; and
federal funds totaled $1,044,026,100.
Co-Chair von Imhof WITHDREW her OBJECTION. She stated that
amendments were due by noon Monday, May 6, 2019.
Co-Chair Stedman thanked Co-Chair von Imhof for her hard
work on the capital budget. He discussed his past work on
the capital budget and recalled the tremendous amount of
work it took to craft the budget.
Co-Chair von Imhof thanked her staff Shareen Crosby and Rob
Carpenter.
9:50:33 AM
Senator Bishop echoed the comments of Co-Chair von Imhof.
SB 19 was HEARD and HELD in committee for further
consideration.
| Document Name | Date/Time | Subjects |
|---|---|---|
| SB 19 Work Draft Version K.pdf |
SFIN 5/3/2019 9:00:00 AM |
SB 19 |
| SB 19 SCS Bill Total Multi-Year Agency Summary - Copy.pdf |
SFIN 5/3/2019 9:00:00 AM |
SB 19 |
| SB 19 Senate CS Sectional Analysis - K Version.docx |
SFIN 5/3/2019 9:00:00 AM |
SB 19 |