Legislature(1993 - 1994)
02/23/1993 01:30 PM House FIN
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 60 FY 94 CAPITAL BUDGET OVERVIEWS: Transportation & Public Facilities INTERMODAL SURFACE TRANSPORTATION EFFICIENCY ACT (ISTEA) W. KEITH GERKEN, DEPUTY COMMISSIONER, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, provided the Committee with handouts regarding ISTEA and its relationship to the Department of Transportation and Public Facilities (DOTPF) CIP request for FY 94. [Attachments #1 - #4]. Mr. Gerken provided the Committee with information regarding ISTEA, an act which allows Alaska to put its transportation policy into practice. Under ISTEA, state government does not have to ask federal permission regarding roads and ferries before decision making. 1 In 1956, the federal government established a highway trust fund. From this trust flows most funding for highway construction in Alaska. In return, the federal government requires maintenance of the completed projects. Highway trust fund dollars are authorized by multi-year highway acts, the recent of which is ISTEA. By enacting ISTEA, the federal government mandated change in transportation policy. It provides the opportunity to improve how transportation decisions are made. The ISTEA funds are divided between three programs. Mr. Gerken explained each of the elements of the program. * BOROUGH TRANSPORTATION PROGRAM - (thirty-five percent) The Borough Transportation Program builds upon the foundation. It establishes a funding target made up of ISTEA dollars for each borough and for the unorganized borough. Each borough will work with local communities in preparing a six year plan made up of ISTEA projects. These plans provide the basis for preparing the local portion of the CIP and capital budget request. Thirty-five percent of ISTEA funding goes to the Borough Transportation Program and is then distributed. The distribution is based upon population and vehicle registrations. Each borough automatically receives a base allocation of $350 thousand dollars. Eighty percent of the program is designated for individual boroughs, whereas, twenty percent of the program is distributed on a competitive basis. * CORE SYSTEM IMPROVEMENTS - (fifty percent) Core highways and ferries move passengers and freight throughout the State. The purpose of the core highway system is to serve statewide purposes such as the long-range movement of people and goods. Core highways and ferry routes stretch across rural Alaska. At each community, the core system includes the link from the airport to the community center. "Core" highways provide connections from: Community center to community center; airport to community center; and ferry terminal to community center. "Core" highway also provide access to rural resources and connect strategic import and export points that ship to or from national and international markets. * SYSTEM EXPANSION - (fifteen percent) The purpose of the system expansion is to invest in the 2 future. ISTEA provides the capability to do this while meeting the investment needs of the existing transportation system. ISTEA provides federal funds to address the investment needs in the State. Following legislative approval, ISTEA dollars can be used to finance system expansion. However, first each of these priorities must undergo an exhaustive assessment, as required by federal law. A public comment and review process helps to guide a full technical and environmental evaluation. The purpose of this process is to carefully assess the proposed improvements and its social and environmental impacts. Mr. Gerken referenced the key points of the ISTEA funding. [Attachment #2]. The proposal calls for a federal funding allocation for surface transportation to borough governments. It explains the process for selecting capital improvements to the local portion of surface transportation systems in Alaska. The proposal affects only the funding of capital improvements. Maintenance arrangements are not altered by this proposal. 1. A working group was convened at the request of the Conference of Mayors to evaluate the proposal from DOTPF to establish a borough transportation program. 2. The working group recommends that at least thirty- five percent of the ISTEA funding be allocated to local transportation improvements. 3. DOTPF should help each borough government to prepare a multi-year transformation plan. 4. Applying thirty-five percent of the statewide target for ISTEA funding results in a minimum program level of $83 million annually. The figure includes $75 million in ISTEA funding and $8 million in State match, and will change if the statewide target for ISTEA funding changes. 5. ISTEA funding alone is inadequate to meet the transportation needs of our State. Municipal officials must work with state officials to identify other sources of funding to meet those needs. Co-Chair Larson asked if the match listed in the Borough Transportation Program was local or State general fund. Mr. Gerken stated it was a state match, and would be included with the federal monies. DOTPF would be responsible to 3 provide the match funds. Co-Chair MacLean questioned if the computation determinations were arbitrarily agreed upon by the borough program. She felt that snow machines and other unregistered vehicles should be included by unorganized boroughs if that would entitle them to a larger allocation. Mr. Gerken explained that the current system in use is fair and easy to understand. He reiterated that all areas begin with a base rate of $350 thousand dollars. Representative Hoffman asked how funding for the unorganized boroughs would be allocated. Mr. Gerken replied those boroughs have been a challenge to the Department. DOTPF has provided funds to the Department of Community and Regional Affairs (DCRA) to help identify and prioritize needs in the unorganized boroughs. (Tape Change, HFC 93-30, Side 2). Representative Hoffman stressed that DOTPF has not addressed the transportation needs in rural Alaska. Unorganized boroughs consume over fifty percent of the State. In order to be equitable in the negotiation process, the costs of construction should be taken into consideration. Mr. Gerken acknowledged that the cost of construction concern is complicated. ISTEA provides new flexibility standards for construction considerations. Representative Hoffman stated the assessment process would be fair if the urban versus rural standards were equal in the beginning. Co-Chair Larson questioned how a local government could exempt vehicles from being registered. He stated that should be a source of additional revenues. Mr. Gerken stated these rules have been determined in State statute. There is an exemption which is based on community size and the estimated number of vehicles. Representative Grussendorf asked if communities in the unorganized boroughs would receive allocations for FY 94. Mr. Gerken noted, proposals from some of those communities have been provided to the Department. The budget will be amended to include those requests if they are received in a timely manner. Mr. Gerken agreed that the process does give the advantage to the larger communities. Co-Chair MacLean asked the status of those boroughs which do not have "road powers". Mr. Gerken stated in FY 94 projections, there are projects previously planned, which will begin in unorganized boroughs. These projects are equal to allocations given the urban areas. He stressed that all boroughs have planning powers. In order for the 4 borough to decide how they are going to spend the capital construction dollars, they must have "road powers". Until they have those powers they will not be able to spend the allocated funds. Co-Chair Larson indicated that second class boroughs have three powers: 1. Taxation 2. Education 3. Planning and zoning. DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES (DOTPF) CIP REQUESTS Mr. Gerken referenced Attachment #3 which itemizes DOTPF's funding source for budget requests including the general fund match. The match is half of the general fund request. The source of funds originate as follows: * General Funds $ 60,996.0 * Federal Funds $354,917.8 * International Airport Revenue Fund $ 20,666.0 * Highway Working Capital Fund $ 11,700.0 * Oil and Hazardous Spill Fund $ 992.0 * Vessel Replacement Fund $ 6,400.0 * CIP Receipts $ 200.0 RON LIND, DIRECTOR, PLANS, PROGRAMS AND BUDGET, DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES, explained the process used in calculating the State's general fund match percentage and factors which were examined. Mr. Gerken commented on the statewide uses of DOTPF's CIP requests: * General Fund match for Federal-Aid Highways general fund allocations $23.2 million dollars. * General Fund match for Federal-Aid aviation, general fund dollars $5.5 million dollars. * State equipment fleet and refurbishment replacement program allocation provided by the Highway Working Capital Fund which allows the 5 purchase of trucks, graters and snowblowers. (Tape Change, HFC 93-31, Side 1). * Corps of Engineers Program allocations request for $2.5 million dollars which provides community match funds. Co-Chair MacLean asked the impact of the budget cut from the original $6 million dollar request to the Governor's requested amount of $2.5 million dollars. Mr. Gerken stated the impact would depend upon the decisions of the Corp and the speed in which they make those decisions. * Annual Planning Work Program allocation request for $550.0 thousand dollars. This is state money accompanied with federal highway planning research funds of $3.7 million dollars to fund planning activities through DOTPF and the boroughs. Co- Chair MacLean questioned if the funds would be used for ISTEA. Mr. Gerken stated they would not. * Statewide facilities major repair, renovation and equipment request for $1.5 million dollars which would fund the renovation of buildings, heat ventilating systems, roofs and windows on DOTPF buildings. * Highway and aviation non-routine maintenance capital request for $1.0 million dollars is the emergency fund for bridges, roads, flooding and other small emergencies which can not be elevated to the place of receiving State emergency funds. * Statewide advanced project definition allocation request for $650.0 thousand dollars which would fund CIP positions in the Department to do work which does not currently have an authorized position. * Ports and harbors non-routine maintenance request for $1.0 million dollars, an allocation for harbor facilities which are affected by storms and floods. * The American Disabilities Act statewide code compliance request for $8.0 million dollars which addresses the highest prioritized needs identified by the inventory of buildings complying with this Act. Co-Chair MacLean asked if there were federal dollars associated with compliance with this code. 6 Mr. Gerken said there may be federal dollars for undertaking the assessments. * The U.S.G.S. Digital Mapping Program match for $30 thousand dollars will allow the State an equal amount of money to the Geological Physical Survey to provide additional mapping within the State. * The Federal Transit Administration grants request for $16 thousand dollars flow through the Administration for capital expenditures for buying buses. * DOTPF maintained facilities energy code upgrade request for $3.5 million dollars which will be used to upgrade heating/ventilating systems, to install more energy efficient overhead doors in maintenance shops and place high efficiency burners on heating equipment. * Federal Transit Administration Metropolitan Planning Grant request for federal dollars of $200.0 thousand dollars all of which would go to Anchorage for their transit planning. * The standards manual publishing request for $80.0 thousand dollars in program receipts in order to publish a number of standards, contract specifications and manuals. There is a charge for distribution of publications and that revenue is used to produce new manuals. * Hazardous Materials Response Contingency Fund allocation for $250.0 thousand dollars originates from the Spill Response Fund. The appropriation funds an analysis of clean up requirements throughout DOTPF facilities. Representative Therriault disagreed with using 470 funds for this request. Mr. Gerken did not know the appropriate use of those funds and recommended referring that question to the Department of Environmental Conservation (DEC). Co-Chair MacLean concluded the meeting and asked for continuation of DOTPF's discussion of the CIP requests to be scheduled for a later date.