Legislature(2003 - 2004)
04/01/2004 01:35 PM Senate TRA
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* first hearing in first committee of referral
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= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 371-POWERS/DUTIES DOTPF
CO-CHAIR WAGONER announced SB 371 to be up for consideration.
SENATOR GARY STEVENS, sponsor, said this bill cleans up an
obsolete statute at the request of the DOTPF and Attorney
General. An Executive Order (EO) created an Alaska
Transportation Council in the 1970s, which directed the DOT
commissioner to consult with the council on all transportation
projects, but the council never was appointed. The state is not
complying with this old statute and it could be the basis for
litigation. SB 371 amends the statute and makes it retroactive
as well. Other changes allow the commissioner to study
alternative fuels for use in state vehicles and changes annual
requirements to periodic, which will allows the commissioner
discretion in choosing sensible times.
SENATOR LINCOLN asked what projects are being held up because of
litigation on this issue.
SENATOR GARY STEVENS answered the Iliamna bridge project is
being held up for one.
MR. OTTESEN elaborated that the EO became law years ago when the
legislature did not take action to keep it from becoming law -
by default. It never underwent an approval process. The bridge
lawsuit has three issues: the council was not formed, DOTPF
didn't consider cost and benefits at the time the project was
selected and that the project was baselined [this project was
treated as on-going in the Southwest Alaska Transportation Plan
and it shouldn't be subject to additional planning]. The court
found in favor for the state on two of those arguments - having
no council and baselining, but the cost and benefits had to be
fully evaluated. He explained that the department didn't feel at
that time that rural projects would ever measure up to urban
projects if they were measured by the same test, simply because
rural projects serve far fewer people. Rural and urban projects
didn't have the same set of questions on the department's
scoring criteria. This is the fault the court found.
The department is backing up in its Southwest Transportation
Plan and selecting this bridge and one other that was also under
construction. It is reconsidering costs and benefits for both
projects, which will cost about $50,000.
Our fear is that this particular legal theory, which
now has been upheld by the courts, can be used on many
other projects, including projects that are under
construction right now, projects that are in the
design pipeline and will soon be under construction.
He explained that his major concern was that selecting only the
most cost effective projects would leave out all rural projects
and would make 40 percent of Alaska's population transportation
orphans.
SENATOR LINCOLN said she didn't want to see the state without
performance standards for rural Alaska facilities in reference
to language on page 3, line 24.
MR. OTTESEN answered that years ago the department was the
architect of school district facilities in rural Alaska, but
authority was transferred typically to the local governments,
rural education attendance areas or boroughs 15 years ago.
SENATOR LINCOLN said that thankfully there were not a lot of
boroughs out there, but she didn't know if anyone was identified
as the responsible party to accomplish what the bill is
deleting.
MR. OTTESEN replied that he understood her concern, but the bill
before the committee is truly housekeeping and isn't at the
heart of what the department is doing to try to save rural
transportation projects. "We're really concerned about the cost
and benefit language and how that may be applied to projects all
across the state."
SENATOR THERRIAULT asked if the same result could be
accomplished by just passing a letter of intent with the
legislation.
MS. SUSAN YURIG, Department of Law (DOL), said that the language
in the bill protected regulations from being exposed.
SENATOR LINCOLN moved Amendment 1 to reinsert the deleted
section on page 3, line 24, through page 4, line 19. The sponsor
didn't object. There were no objections and it was so ordered.
MR. MARK HICKEY, representing the Lake and Peninsula Borough,
supported SB 371 and said the focus of the lawsuit is on a
project that has been this borough's number one priority for
over 10 years. It completes a road connection between three
communities that has tremendous benefits in terms of saving
transportation costs and lives. He said the goal of the
Executive Order was to give DOT a strong presence working on
public facilities. After the change in planning authority, the
department has not had the facilities technical expertise for
the last 15 years. It has had all federally funded and no state
funded projects.
CO-CHAIR WAGONER commented that often the cost benefit analysis
overshadows issues of loss of life and safety and the socio-
economic impact of a project. "I think that should have just as
much weight as the cost benefit analysis in some cases."
MR. JEFF PARKER, representing Bob Gillam and Trout Unlimited
presented the other side of the issue, which is whether a cost
benefit analysis needs to be present in statute for all projects
or amended. He said this legislation would not block every
project under construction, because the requirement to consider
cost and benefits applies only to new projects.
The second issue is that the current statute does not require a
positive cost benefit ratio; it only requires the department to
consider it. He referenced attachment D in his letter, the
Southwest Regional Transportation Plan that gives the cost
effectiveness data on five proposed projects in the Lake and
Peninsula Borough, and it shows the Williams Port to Pyle Bay
road coming out as paying for itself. He asked the committee why
a project like Iliamna Nondalton should be funded, with a cost
benefit ratio of 0.26 instead of a project that comes out with a
favorable cost benefit ratio.
He said there has been only one reported fatality in the last 15
years of someone drowning in the Nondalton area. The state
trooper's report on that fatality says a snow machine went
through the ice and the driver was inebriated. There is no
evidence that the person was trying to cross the river from
Nondalton to Iliamna. Mr. Ottesen conceded that was the only
death. A much more effective use of dollars from a safety point
of view would be to build a bridge between old and new Naknek.
I am convinced you will end up funding projects that
will not be well justified if you abandon this
requirement from state law. It simply makes sense,
particularly in times of budgetary constraint....
He referred the committee to section (1)(b) of the bill that
affirms the validity of the State Transportation Planning
process and asked, "Affirmed with respect to what?" He didn't
think that question was answered at all. Further, he pointed out
that Mr. Hickey was commissioner when portions of that money was
spent, but the project didn't get completed before his successor
found that it was economically unjustified. "If you want to
continue that process of wasting money on poorly justified
projects, then go for the bill."
TAPE 04-15, SIDE A
MR. PARKER noted copies of cost benefit analysis that he had
sent the committee and asked if it didn't make sense for the
department to have that kind of information.
CO-CHAIR WAGONER said he just received the information today and
wanted to hold the bill for further review. There being no
further business to come before the committee, he adjourned the
meeting at 3:35 p.m.
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