04/11/1996 03:06 PM Senate TRA

                                                                               
               SB 315 ALASKA RAILROAD PROCUREMENT                             
                                                                              
 Number 172                                                                    
                                                                               
 CHAIRMAN RIEGER introduced  SB 315  as the next order of business             
 before the committee.  He noted that there was a proposed CS.                 
                                                                               
 SENATOR GREEN moved that the CS, version C, be adopted in lieu of             
 the original bill.  Hearing no objection, the CS was adopted.                 
                                                                               
 HENRY SPRINGER, Executive Director for the Alaska Chapter of the              
 Associated General Contractors, said that the association did not             
 have any problem with the $25,000 limitation which is in the                  
 procurement code.  He indicated that artificial separation of                 
 projects to keep the total below the $25,000 limitation should not            
 occur.                                                                        
                                                                               
 MARK HICKEY, Alaska Railroad Corporation, noted that the committee            
 had been provided with more information regarding the type of                 
 projects the railroad gets involved with.  A typical project, runs            
 from $50,000 to $120,000.  The railroad occasionally has large                
 projects such as the "Bird to Gird" project which was a $1.5                  
 million project.  He understood that the bill would ensure a                  
 competitive process.  Mr. Hickey suggested that the $25,000 be                
 raised.  Currently, under state law for DOT that limitation is                
 $100,000.  DOT can force account on construction under $100,000.              
 He believed that a finding was required in order to show that the             
 department could do the work for less than what it would otherwise            
 be done.                                                                      
                                                                               
 Number 225                                                                    
                                                                               
 CHAIRMAN RIEGER inquired of Mr. Springer's opinion of raising the             
 limitation to somewhere between $25,000 and $100,000.  HENRY                  
 SPRINGER believed that $25,000 was a fair limitation, however Mr.             
 Springer acknowledged that the limitation should depend upon the              
 normal scope of the work.  In Mr. Springer's experience with                  
 railroad work with DOT, the work either falls in the lower end or             
 the higher end.  The $100,000 in the procurement code includes                
 provisions for mobilization and demobilization in remote areas.               
 The Alaska Railroad is not in remote areas.                                   
                                                                               
 SENATOR GREEN asked if there were many contractors available that             
 could do these types of projects.  HENRY SPRINGER said that                   
 expertise is available in the market.  In Mr. Springer's                      
 experience, the specifications governed what the contractor could             
 do and that would be the basis for the bid.  Nothing in SB 315                
 prevents the railroad from bidding on a project like any other                
 contractor.                                                                   
                                                                               
 CHAIRMAN RIEGER asked if anyone else was present to testify.                  
 Hearing no one, he asked if there were any amendments.  Hearing               
 none, Chairman Rieger inquired as to the pleasure of the committee.           
                                                                               
 SENATOR LINCOLN asked if there was anyone from DOT to testify.                
 CHAIRMAN RIEGER said that no one from DOT had signed in.  Chairman            
 Rieger noted that Sam Kito III was present at the last meeting.               
                                                                               
 SENATOR GREEN moved that CSSB 315(TRA) be moved from committee with           
 individual recommendations.  Hearing no objection, it was so                  
 ordered.