04/23/1997 05:35 PM Senate FIN

                                                                               
       CS FOR SENATE BILL NO. 21(STA)                                          
                                                                               
       "An  Act  relating  to  ferries  and  ferry  terminals,                 
  establishing   the  Alaska  Marine  Highway  Authority,  and                 
  relating to    maintenance  of  state  marine  vessels;  and                 
                                                                               
                                                                               
  providing for an    effective date."                                         
                                                                               
  Senator Taylor,  sponsor  of SB21  was invited  to join  the                 
  committee.  In a brief explanation of the bill he noted this                 
  bill would  be an  ongoing working  document.   He said  the                 
  creation   of  the  Marine  Highway  Authority  would  bring                 
  stability  to  the system.    At  the present  there  was an                 
  increasing level of  bureaucracy and  a decreasing level  of                 
  services.  In  answer to  a question from  Senator Adams  he                 
  said the Authority  would be an entity within the Department                 
  of Transportation.  Senator Torgerson asked if the Authority                 
  would  be  able  to  spend Federal  funds.    Senator Taylor                 
  indicated  they would.   Senator Adams  said he  would still                 
  like to look at the matter  of setting up an Authority.   He                 
  felt there had been a lack of communication.  Senator Taylor                 
  responded  that within the  entire infrastructure  there had                 
  been a lack of  communication.  He would applaud  any change                 
  to bring  expertise  to the  Marine  Highway.   The  bandaid                 
  approach up until now only fixed part of the problem.                        
                                                                               
  Senator Torgerson commented on fiscal  notes.  He noted  the                 
  chief operating officer's fancy fee.   He suggested amending                 
  the Department of  Transportation's fiscal note to  zero and                 
  send the money otherwise earmarked to the Authority.                         
                                                                               
  Senator Phillips  in a comment  to the committee  noted that                 
  Juneau  was  against the  bill  and Ketchikan  supported the                 
  bill.                                                                        
                                                                               
  In conclusion of his testimony, Senator Taylor said the best                 
  time to make the transition to the Authority would be in the                 
  winter when the ferry system was slowed down.                                
                                                                               
  Commissioner  Joseph  Perkins, Department  of Transportation                 
  and Public Facilities was invited to join the committee.  He                 
  said the Administration  did not support SB 21.   Reductions                 
  to  the  operating   budget  year  after  year   had  caused                 
  operational  problems and  reductions in  services.   Stable                 
  funding  must be addressed  and there should  be an adequate                 
  stable funding source.  He said due to maintenance for ships                 
  having been  cut there would  be some difficulty  in getting                 
  Coast  Guard  certification.   The  majority  of  the marine                 
  routes  were  a  part of  the  federally  designated highway                 
  system.    This  tied  the  system  into  the road  network.                 
  Further, he noted the Authority was not in the Department of                 
  Transportation  and it  would  operate independently.    The                 
  creation of the Authority would only cause more competition.                 
  Two points he brought  up for the committee to  consider for                 
  the creation of the  Authority were:  1.   the project  must                 
  get on  STIP for federal  funds; and  2.  they  must receive                 
  legislative authority.   He felt the Authority  at this time                 
  was moving in the wrong direction.  There would be  the same                 
  isolation for the Marine Highway as for the  Alaska Railroad                 
  system.  The needs of the travelling public have drastically                 
                                                                               
                                                                               
  changed.  There should be changes made within the Department                 
  of Transportation to address these needs.                                    
                                                                               
  Senator Adams  voiced a concern for Federal  funding for the                 
  Authority.   Commissioner  Perkins  explained  that  Federal                 
  funds were given  to the Department of  Transportation.  The                 
  Marine Highway Authority  would have to compete  for federal                 
  funds based on how projects were graded and scored.                          
                                                                               
  Bob Ward, City  Manager, Skagway, Alaska was invited to join                 
  the committee.   He said the City of Skagway  opposed SB 21.                 
  If there was  enough money there  would be enough ships  and                 
  therefore no problems.  He felt there were many  significant                 
  points that needed  to be addressed.   A continued trend  of                 
  decreased funding had led to a decrease in service levels to                 
  community residents in the winter.                                           
                                                                               
  Andrea Barkley,  Alaska Marine Highway  System/IBU Executive                 
  Committee was invited to join the committee.  She was  a 19-                 
  year Marine  Highway employee and  supported the bill.   She                 
  said there were many problems that  needed to be changed and                 
  the creation of the Authority offered potential improvement.                 
                                                                               
  Stephanie Rainwater, Alaska  Marine Highway System, Chairman                 
  of Management Labor Advisory  Board was invited to  join the                 
  committee.   She was a  10-year Marine Highway  employee and                 
  also supported the bill.  She explained the last three years                 
  there had been  a decrease in services and poor reservations                 
  system.   There had  been too much cutting  back and now not                 
  enough money left to keep the  system running.  There needed                 
  to be a  change and she  said that Marine Highway  employees                 
  supported SB 21.   They were good employees, wanted  to give                 
  good service; and therefore the Marine Highway System should                 
  keep people employed and let them provide good service.  She                 
  also noted that  many times the  ships are not always  full.                 
  Senator Adams concurred  and said that everything  was going                 
  down because of budget cuts.                                                 
                                                                               
  Senator Torgerson responded by saying that there  had been a                 
  cut in Administration but that $1  million had been put back                 
  into the  Marine  Highway  budget  specifically  for  vessel                 
  operation.   Ms. Rainwater said  perhaps one should  look at                 
  the Administration employees.                                                
                                                                               
  Gerald Hope, Tribal Council  Officer as Secretary, Ketchikan                 
  Indian Corporation was  invited to join  the committee.   He                 
  spoke on  behalf of the  Southeast Alaska families  and said                 
  the Alaska Marine Highway System provided transportation for                 
  these  families to keep in close touch  with each other.  He                 
  said the Corporation supported SB 21.                                        
                                                                               
  Fred Shield,  representative, Haines Borough and  Chamber of                 
  Commerce was invited to join the  committee.  He said Haines                 
  supported SB 21.                                                             
                                                                               
                                                                               
  James L.  Van Horn,  member, Ketchikan  Gateway Borough  was                 
  invited to join  the committee.   He said  the death  spiral                 
  system of the Alaska Marine  Highway had to be changed.   He                 
  supported SB 21.                                                             
                                                                               
  Senator Taylor in response to the given testimony noted that                 
  three  years ago the captains for  the Alaska Marine Highway                 
  sent  in  a  letter  to  their  superiors  asking  only  for                 
  competent management.                                                        
                                                                               
  Co-chair Sharp set the bill aside.