Legislature(2005 - 2006)HOUSE FINANCE 519
05/09/2005 08:30 AM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| SB153 | |
| HB68 | |
| SB22 | |
| SB164 | |
| SB22 | |
| SB135 | |
| SB73 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | SB 153 | TELECONFERENCED | |
| + | SB 22 | TELECONFERENCED | |
| + | SB 164 | TELECONFERENCED | |
| + | SB 135 | TELECONFERENCED | |
| += | HB 68 | TELECONFERENCED | |
| += | SB 73 | TELECONFERENCED | |
| + | TELECONFERENCED |
CS FOR SENATE BILL NO. 73(FIN) am
An Act relating to a lease-purchase agreement for the
construction, equipping, and financing of a state
virology laboratory in Fairbanks to be operated by the
Department of Health and Social Services; relating to
the issuance of certificates of participation for the
laboratory; relating to the use of certain investment
income for certain construction and equipment costs for
the laboratory; and providing for an effective date.
DR. RICHARD MANDSAGER, DIRECTOR, DIVISION OF PUBLIC HEALTH,
DEPARTMENT OF HEALTH AND SOCIAL SERVICES, spoke in support
of the legislation. He explained that the Governor
introduced the legislation in order to build a virology
laboratory in Fairbanks. The laboratory is part of the
public health system for the state. It is currently housed
in part of an old building on the University of Alaska
Fairbanks campus. He recounted occurrences, which required
quick analysis of laboratory samples, such as during
Iditarod Norovirus outbreak and a measles outbreak in
Juneau. He emphasized the importance of early diagnosis of
infections diseases. The Senate has proposed that the
replacement come as a capital project.
11:11:57 PM
Representative Stoltze noted that the originally legislation
mentioned land from the University of Alaska. Dr. Mandsager
explained that the initial bill provided that land would be
available from the University of Fairbanks for lease at no
cost. The legislation was broadened to allow the project to
occur somewhere else in Fairbanks if it is funded. The
intent is still to obtain land for lease at no cost.
Representative Stoltze questioned the location. Dr.
Mandsager noted that the department had previously
recommended Anchorage. The Public Health laboratory was
built in Anchorage with additional space, but since 911 the
extra space in Anchorage has been taken for prevention
efforts.
In response to a question by Representative Stoltze, Mr.
Mandsager explained that Fairbanks was recommended due to
the close proximity to the University of Alaska, Fairbanks.
The laboratory would add capacity as a basic safety
laboratory level three facility that can be dual used by the
department and the university. He added that the virological
staff would be hard to replace [if it were moved from
Fairbanks] and noted that earthquake threat and other
disaster response would be spread between two cities.
Discussions occurred with the university and the department,
which resulted in the recommendation of Fairbanks.
11:16:03 PM
DEVON MITCHELL, EXECUTIVE DIRECTOR, ALASKA MUNICIPAL BOND
BANK AUTHORITY, DEPARTMENT OF REVENUE, explained that the
project would be financed through a certificate of
participation, which would create a lease by giving a
trustee bank the title interest of the facility. The
department would enter into a lease agreement with the
trustee bank. The lease revenue stream becomes the security
and the certificate of participation is in the lease. They
are looking at a 15-year-term rate, with a 4.9 percent
interest schedule (which is 80 - 90 basis points over
current market) and annual debt in the $2.3 - $2.4 million
dollar range. Other facilities have been funded by the same
funding mechanism such as: the Department of Environmental
Conservation Seafood, Food Safety laboratory, the Department
of Health and Social Services laboratory in Anchorage, and a
number of courthouses and prisons. It would have an impact
on the state of Alaska's general fund, but he did not think
it would adversely impact the state's credit rating.
11:18:58 PM
Mr. Mitchell spoke to the interest rate. He acknowledged
that the interest rate in the legislation is "perhaps" at a
more optimistic level than that put forth with GARVEE bonds.
The are mitigating factors, which resulted in a more awkward
certification of participation with the GARVVEE bonds.
11:19:51 PM
Representative Stoltze observed that the Governor's
assumption was for a long-term lease at no cost.
Mr. Mitchell suggested that the Administration is still
looking at land owned by the state of Alaska. He did not
know what development costs would be associated with another
site. He acknowledged that there could be unforeseen
obstacles.
11:21:06 PM
Representative Weyhrauch asked if there had been a cost
benefit analysis of building a laboratory, as opposed to
gold streaking samples. Dr. Mandsager noted that they had
not done a cost analysis. He noted that samples from the
southeast area of the state would not pose a problem, but
that samples from the central region and other areas would
have considerable amount of time added. He cautioned that
the length of time it takes to get samples tested could
become important in relationship to bird flu (if it is every
transmitted to humans). He spoke in support of instate
services.
Mr. Mandsager observed that the types of tests that are done
at the laboratory are not done at hospitals in the state.
Influenza testing is done at public health laboratories.
Time is at issue and delays could create problems. Tests for
rabies occur once every couple of weeks.
11:24:03 PM
In response to a question by Representative Chenault, Dr
Mandsager emphasized "they are building what is necessary
and no more". The proposed size is smaller than some of the
program people have argued for. Professionals from other
states, which looked at the state of Alaska's test volume
and capacity, felt that the proposed laboratory would be the
minimum size to meet the state's needs. He thought it was a
"Chevy" [not a "Cadillac].
Representative Chenault referred to page 2, of the handout.
He noted that 36,267 specimens were tested in FY04.
11:26:28 PM
Representative Holms MOVED to report CSSB 73 (FIN) am out of
Committee with the accompanying fiscal note.
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