Legislature(2019 - 2020)GRUENBERG 120

03/10/2020 01:00 PM House MILITARY & VETERANS' AFFAIRS

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01:02:23 PM Start
01:03:02 PM HJR27
01:53:58 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
-- Testimony <Invitation Only> --
+ Bills Previously Heard/Scheduled TELECONFERENCED
**Streamed live on AKL.tv**
          HJR 27-FEDERAL INVESTMENT IN PORT OF ALASKA                                                                       
1:03:02 PM                                                                                                                    
CO-CHAIR SHAW announced that the  only order of business would be                                                               
HOUSE  JOINT  RESOLUTION NO.  27,  Requesting  the United  States                                                               
Department of Defense to invest in the Port of Alaska.                                                                          
1:04:03 PM                                                                                                                    
ETHAN BERKOWITZ,  Mayor, Municipality of Anchorage,  testified in                                                               
support  of HJR  27,  which  he said  would  work  to ensure  the                                                               
military was  prepared for contingencies.   He said HJR  27 would                                                               
urge Congress  to participate in  the reconfiguration of  the new                                                               
port so  the commitment  may be  honored.   He added  neither the                                                               
State of Alaska nor the  Municipality of Anchorage had the fiscal                                                               
wherewithal  to  do everything  that  could  be done  to  support                                                               
national  defense, but  with a  bit  of "couch  change" from  the                                                               
federal government, the federal mission  could be supported.  The                                                               
Port  of Alaska  would be  able  to remain  one of  the 17  ports                                                               
designated  as  "strategic" by  the  U.S.  Department of  Defense                                                               
(DoD),  and  missions  of  all   bases  in  the  state  could  be                                                               
supported.  He  added it was a  good sign that more  than half of                                                               
the committee had signed on as co-sponsors to HJR 27.                                                                           
1:05:54 PM                                                                                                                    
REPRESENTATIVE ZACK  FIELDS, Alaska  State Legislature,  as prime                                                               
sponsor,  presented HJR  27.   Representative Fields  related via                                                               
PowerPoint  presentation  that the  Port  of  Alaska is  Alaska's                                                               
largest port, handling more than  three-quarters of all railbelt-                                                               
bound, waterborne, non-fuel freight cargo,  as well as 95 percent                                                               
of all  refined petroleum products.   The port served  85 percent                                                               
of the state's  population, he added, well  over 200 communities.                                                               
Relevant to HJR 27 was that  the port was the primary entry point                                                               
for DoD installations,  including Joint Base ElmendorfRichardson                                                                
(JBER), Fort Wainwright, Eielson Air  Force Base and Fort Greely,                                                               
he said.   The port was  one of only 23  DoD-designated strategic                                                               
sea  ports, he  related, and  maybe the  only one  as at  risk of                                                               
corrosion  and failure  in  the event  of  a significant  seismic                                                               
event.   The Port  of Alaska handled  most consumer  goods coming                                                               
into  the  state  and  was  a foreign  trade  zone  as  well,  he                                                               
imparted.    Jet fuel,  including  that  used  at JBER,  came  in                                                               
through the  port, he  added, and increased  demand for  jet fuel                                                               
from the state's military bases  has helped keep port losses from                                                               
being more severe.   Tankers carrying jet fuel into  the port now                                                               
made up nearly half the port's  business; such units as the 172nd                                                               
Stryker Brigade  Combat Team at  Fort Wainwright and  an Airborne                                                               
Brigade Combat  Team at  Fort Richardson  require the  ability to                                                               
deploy by sea, he related.                                                                                                      
1:08:54 PM                                                                                                                    
REPRESENTATIVE  FIELDS said  he  had seen  the  corrosion on  the                                                               
port's pilings himself  and it was severe.   Referencing slide 5,                                                               
regarding renovation  needs for  the port,  he said  increases in                                                               
taxes wouldn't be enough to pay  for all of the improvements that                                                               
were needed  for the port, whose  main work was to  carry out DoD                                                               
operations, hence the need for HJR 27.                                                                                          
REPRESENTATIVE  FIELDS imparted  he had  been approached  by port                                                               
commissioners,  specifically   by  Captain  Bob   Pawlowski  from                                                               
Anchorage,  who shared  the resolution  from the  Port Commission                                                               
and  requested   the  legislature   draft  a   resolution,  which                                                               
Representative Fields said he felt was the correct thing to do.                                                                 
1:10:36 PM                                                                                                                    
REPRESENTATIVE  RAUSCHER asked  how 20  percent was  arrived upon                                                               
and how, if at all, the work was intended to be separated.                                                                      
REPRESENTATIVE  FIELDS replied  that the  20 percent  was just  a                                                               
figure to  show the importance  of the port  for DoD; HJR  27 had                                                               
been  written  more  generally  and  there  were  many  "whereas"                                                               
statements  regarding  the  importance  of the  port  to  defense                                                               
installations.   He noted any  amount of money received  from DoD                                                               
and Congress would be helpful.                                                                                                  
REPRESENTATIVE  RAUSCHER  asked where  the  20  percent would  be                                                               
spent, if received.                                                                                                             
REPRESENTATIVE  FIELDS answered  that the  first project  was the                                                               
cement terminal's  pilings, but he  would defer to port  staff to                                                               
give a more detailed answer.                                                                                                    
REPRESENTATIVE RAUSCHER asked whether  the military paid any fees                                                               
for using the port.                                                                                                             
1:14:23 PM                                                                                                                    
The committee took an at-ease from 1:14 p.m. to 1:15 p.m.                                                                       
1:15:17 PM                                                                                                                    
STEVE RIBUFFO, Director, Port of  Alaska, testified in support of                                                               
HJR  27.   Mr.  Ribuffo  explained  he  has explored  the  port's                                                               
relationship with  the state  and with  DoD, having  retired from                                                               
the U.S. Air Force as a  colonel.  He listed multiple reasons the                                                               
port  was a  key  node to  supply chains,  and  he applauded  the                                                               
committee's  acknowledgment of  there being  no existing  way for                                                               
DoD to  participate in financing  port infrastructure  efforts to                                                               
ensure  that  the capabilities  expected  from  a strategic  port                                                               
would be available  when needed.  He informed  the committee that                                                               
despite the  relationship between port workers  and DoD logistics                                                               
partners, it was agreed that what  DoD needed would likely not be                                                               
consistently deliverable.   Commercial  operations would  need to                                                               
step aside for  DoD and vice versa,  he explained.  If  DoD had a                                                               
way  to  be a  financial  partner  in significant  infrastructure                                                               
planning  and construction,  then  the probability  of having  to                                                               
deal with  "this type of  interruption" would go almost  to zero,                                                               
he stated.                                                                                                                      
1:17:29 PM                                                                                                                    
REPRESENTATIVE SPOHNHOLZ asked what type  of funding HJR 27 would                                                               
make available for the port.                                                                                                    
MR. RIBUFFO,  responding to Representative Spohnholz,  as well as                                                               
to  the  previous  questions asked  by  Representative  Rauscher,                                                               
related  that  when   DoD  used  the  port   for  deployments  or                                                               
redeployments,  it   paid  its  bills,  but   there  was  nothing                                                               
requiring DoD  to provide anything  else for  port infrastructure                                                               
maintenance or replacement.                                                                                                     
1:18:31 PM                                                                                                                    
REPRESENTATIVE SPOHNHOLZ  asked for  confirmation that  there was                                                               
no additional funding available.                                                                                                
MR. RIBUFFO answered that's correct.                                                                                            
1:18:56 PM                                                                                                                    
REPRESENTATIVE  TUCK asked  Mr.  Ribuffo to  confirm whether  DoD                                                               
paid  the same  rates as  other private  entities when  using the                                                               
MR.  RIBUFFO  replied  that  DoD paid  tariff  rates  because  it                                                               
brought in military  sea lift command vessels  or contracted with                                                               
a commercial carrier  to move its equipment and  supplies, so DoD                                                               
paid  the same  rates,  with  the exception  of  Matson and  Tote                                                               
Maritime   shipping  companies,   who   had   what  were   termed                                                               
preferential user  agreements, having negotiated relief  from the                                                               
public rates in a contracted  exchange for a guaranteed amount of                                                               
REPRESENTATIVE  TUCK asked  whether  the guarantee  was still  in                                                               
place considering the current economic downturn.                                                                                
MR. RIBUFFO  replied that  the volume had  been guaranteed  on an                                                               
annual  basis, and  to date  he  had not  witnessed any  downturn                                                               
worth noting.                                                                                                                   
1:21:16 PM                                                                                                                    
REPRESENTATIVE  JACKSON  asked  how   often  DoD  used  the  port                                                               
1:21:34 PM                                                                                                                    
MR.  RIBUFFO replied  that military  equipment moved  through the                                                               
port  all the  time on  the  two scheduled  carriers that  called                                                               
twice a  week.  Major  movements, such as helicopters,  varied in                                                               
terms of  national responsibility.   He added that in  2019 there                                                               
were  seven instances  of movement  of major  equipment; in  2018                                                               
there were only two.                                                                                                            
REPRESENTATIVE JACKSON asked about the  $20 million grant for the                                                               
port  and whether  there was  a portion  DoD was  being asked  to                                                               
MR. RIBUFFO replied  that the $20 million was in  addition to the                                                               
$25  million  received  in  the   fall  of  2019  to  go  towards                                                               
offsetting  the construction  costs  of the  first  piece of  new                                                               
infrastructure.   He said the  offsetting was a success  by about                                                               
$45 million, and the remainder  would go to the banking community                                                               
to  enter a  financing arrangement  to  finish the  project.   He                                                               
added  that the  final price  would be  contingent upon  how much                                                               
fuel was brought in to the port.                                                                                                
1:25:52 PM                                                                                                                    
REPRESENTATIVE   JACKSON  asked   whether   there   had  been   a                                                               
conversation with  DoD and  engineers or whether  HJR 27  was the                                                               
MR.  RIBUFFO  replied  that there  had  been  communication  with                                                               
logisticians  up  to  the  general officer  level  but  not  with                                                               
engineers.   He added that  some of  the best letters  of support                                                               
for grant money have come from DoD.                                                                                             
1:27:51 PM                                                                                                                    
REPRESENTATIVE SPOHNHOLZ asked  what HJR 27 would  achieve if the                                                               
purpose was to secure more funding from DoD when there was none.                                                                
1:28:42 PM                                                                                                                    
MR. RIBUFFO answered  that fuel was half of what  went to DoD for                                                               
the port; the other half was consumer  goods.  He said that as he                                                               
understood HJR 27,  those in the strategic  port industry desired                                                               
financing for  construction and facilities  put into place.   The                                                               
other  aspect  was  the  port  readiness  plan  that  listed  the                                                               
specifics DoD was looking  for when it came to the  port.  If DoD                                                               
did not provide  the actual length it needed, then  it would have                                                               
to be  okay with what the  port built for business  purposes, Mr.                                                               
Ribuffo related.   In other words, DoD needed to  provide what it                                                               
needed to  get exactly what it  wanted, and HJR 27  would provide                                                               
that flexibility.                                                                                                               
REPRESENTATIVE  SPOHNHOLZ asked  what the  timeframe was  for the                                                               
port to make  decisions on the additional capacity  to operate as                                                               
a military strategic port.                                                                                                      
MR. RIBUFFO answered  that the port was  in discussions regarding                                                               
the cargo  dock portion of  the modernization program,  which was                                                               
the next phase  to seek users' input as to  what the requirements                                                               
ought   to  be.     An   invitation  to   participate  in   these                                                               
conversations would be extended to  DoD, he related.  He surmised                                                               
that a  plan would be made  within the next eighteen  months.  He                                                               
added he did not think the strategic port was in jeopardy.                                                                      
1:34:40 PM                                                                                                                    
REPRESENTATIVE  TUCK asked  what  portion of  goods and  services                                                               
going in and out of the port could be attributed to DoD.                                                                        
MR.  RIBUFFO replied  around 20  percent, and  that included  dry                                                               
goods, bulk goods, and refined petroleum.                                                                                       
REPRESENTATIVE TUCK  asked whether,  outside DoD, other  fuel was                                                               
coming into the Port of Alaska to serve Alaska.                                                                                 
MR.  RIBUFFO answered  that the  watershed of  all bulk  products                                                               
including  commercial grade  jet fuel,  high sulfur  diesel fuel,                                                               
and unleaded gasoline, as well  as leaded aviation gasoline, were                                                               
covered to meet customer demand.                                                                                                
1:36:19 PM                                                                                                                    
REPRESENTATIVE  TUCK  asked  whether   the  Port  of  Alaska  had                                                               
lawsuits against  the federal government  over the  oversight and                                                               
construction of the port.                                                                                                       
1:36:32 PM                                                                                                                    
MR. RIBUFFO  replied, "Not  lawsuits."   [Emphasis was  placed on                                                               
the plural  aspect.]   He said  there was  one with  the Maritime                                                               
Administration, which  he explained  was the lead  federal agency                                                               
and  project manager  for the  old intermodal  expansion project.                                                               
He explained  there had been  bad work done  and a big  area left                                                               
unusable as  a consequence,  and "there's  an attempt  to recover                                                               
damages for  that which we've been  elected to have to  deal with                                                               
but  is  otherwise  unusable."     In  response  to  a  follow-up                                                               
question, he said the Maritime  Administration is within the U.S.                                                               
Department of Transportation (DoT).                                                                                             
1:37:31 PM                                                                                                                    
REPRESENTATIVE TUCK recommended that a copy  of HJR 27 be sent to                                                               
DoT considering  the mess  the port  was in  trying to  serve the                                                               
federal government's  needs, especially regarding DoD.   He added                                                               
that  a  copy should  also  be  sent  to  the Department  of  the                                                               
Interior as  it controlled 75  percent of federal lands,  and all                                                               
areas in  which federal  help could be  administered ought  to be                                                               
explored,  as the  port served  not only  Alaska's but  America's                                                               
1:39:06 PM                                                                                                                    
BRITTANY SMART,  Special Assistant to the  Mayor, Fairbanks North                                                               
Star Borough, testified in support of  HJR 27.  Ms. Smart related                                                               
that  the  Fairbanks North  Star  Borough  was  a member  of  the                                                               
Association of  Defense Communities, an organization  that helped                                                               
leverage the  role communities played in  meeting military needs.                                                               
One way this  had been put into effect, she  related, was through                                                               
working  with   Congress  to   establish  the   Defense  Critical                                                               
Infrastructure Program  (DCIP), for which DoD  had been allocated                                                               
$50 million  for 2020.   The need  far exceeded the  $50 million,                                                               
she added;  DoD had  funding for  peripheral concerns,  but there                                                               
was yet a need to establish criteria for "award and review."                                                                    
1:41:27 PM                                                                                                                    
CAPTAIN ROBERT  PAWLOWSKI, Retired  Vice Chair,  Port Commission,                                                               
testified in support of HJR 27.   Captain Pawlowski said the role                                                               
of  the Port  Commission is  to develop  and propose  tariffs for                                                               
goods  and services  across the  port.   He anticipated  the Port                                                               
Commission's  having  to  do the  same  regarding  cargo  tariffs                                                               
associated with  consumer goods coming  into the Port  of Alaska,                                                               
primarily on  Matson and TOTE  Maritime.  He  said it was  key to                                                               
consider that  the quality  of living  that first  attracted, and                                                               
then kept,  military families living  in Alaska, is  dependent on                                                               
the port.   He  informed the  committee there  were approximately                                                               
$2.9 billion in  defense spending in 2017 to  support Alaska, and                                                               
that fund  remained "at  a significant level."   He  related that                                                               
the important, strategic port was  unfunded as a federal mandate,                                                               
and as such it  was not possible to design the  port to the level                                                               
of  resiliency needed  to ensure  proper response  in a  national                                                               
security  incident   or  in  a   disaster.    Without   the  port                                                               
functioning,  major and  arduous  airlift  or sealift  operations                                                               
would be needed to continue military operations, he added.                                                                      
CAPTAIN  PAWLOWSKI  said HJR  27  would  work to  keep  strategic                                                               
resiliency  in  place  as  well  as  to  assist  with  commercial                                                               
viability.   He also  noted that  of the  17 strategic  ports, 15                                                               
were on a  conventional road system; only the Port  of Alaska and                                                               
Guam  were  not,  which  also  came back  to  the  difficulty  of                                                               
overland  road  lift.   He  mentioned  he  was grateful  for  the                                                               
discussion regarding  how to get  authorization for  funding into                                                               
strategic seaport language.                                                                                                     
1:45:18 PM                                                                                                                    
CAPTAIN  PAWLOWSKI  noted  military bases,  particularly  through                                                               
Matson,  were supported  not  only on  mainland  Alaska but  also                                                               
Integrated Support  Command Kodiak  [a naval facility  located on                                                               
Kodiak,  Alaska,  and the  largest  Coast  Guard station  in  the                                                               
U.S.].   He  echoed  other testimony  regarding  quality of  life                                                               
afforded  by  the  port  having  led to  highest  per  capita  of                                                               
veterans,  who  depended  on services  administered  by  Veterans                                                               
Affairs (VA).                                                                                                                   
1:46:04 PM                                                                                                                    
REPRESENTATIVE  SPOHNHOLZ asked  for more  details regarding  the                                                               
relationship  between  the  Port   of  Alaska  and  the  military                                                               
installations on Kodiak.                                                                                                        
CAPTAIN PAWLOWSKI  answered that Kodiak depended  on Matson after                                                               
Matson called  on the port,  the port  not being large  enough to                                                               
support full container ships.                                                                                                   
1:47:33 PM                                                                                                                    
REPRESENTATIVE TUCK asked how many strategic ports there are.                                                                   
1:47:54 PM                                                                                                                    
REPRESENTATIVE FIELDS  replied there  are 17  commercial seaports                                                               
and an  additional 5  DoD ports.   In response  to Representative                                                               
Tuck,  he  confirmed  that most  strategic  seaports  serve  both                                                               
commercial  and   DoD  functions,  while  some   only  serve  DoD                                                               
functions.  He added he did  not know whether DoD weighted either                                                               
more heavily, in terms of importance to defense installations.                                                                  
REPRESENTATIVE  TUCK asked  for confirmation  that 17  commercial                                                               
seaports should be in HJR 27.                                                                                                   
1:48:51 PM                                                                                                                    
REPRESENTATIVE  FIELDS confirmed  that  is  correct, because  the                                                               
Port of Alaska was a commercial seaport.                                                                                        
1:49:00 PM                                                                                                                    
CO-CHAIR THOMPSON related he was in  the U.S. Army working in the                                                               
transportation office  at Fort  Wainwright in  1965 when  the 6th                                                               
and   9th  infantry,   basically  the   entire  Fort   Wainwright                                                               
population of military,  had been shipped to Vietnam.   From 2001                                                               
to 2007, when he was city  mayor, the striker brigade was shipped                                                               
overseas from  Fort Wainwright.   He spoke  to the  importance of                                                               
the port and expressed gratitude for HJR 27.                                                                                    
1:50:55 PM                                                                                                                    
REPRESENTATIVE  JACKSON  asked  where the  additional  five  non-                                                               
strategic seaports were located.                                                                                                
1:51:08 PM                                                                                                                    
REPRESENTATIVE FIELDS replied he did not know.                                                                                  
1:51:19 PM                                                                                                                    
REPRESENTATIVE  SPOHNHOLZ  thanked  the  sponsor of  HJR  27  and                                                               
admitted the ability to meet military needs required funding.                                                                   
1:53:45 PM                                                                                                                    
CO-CHAIR SHAW announced that [HJR 27 was held over].                                                                            

Document Name Date/Time Subjects
HJR27 Sponsor Statement 2.25.2020.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document DOD's Newest Strategic Seaport.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Ensuring Transportation Readiness.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Feds Give 20 Million.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Infastructure Report Card.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Modernization Program.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Office of Inspector General Audit Report.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Port Gets New Name.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 ver M Supporting Document Strategic Seaports.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR 27 Supporting Document Powerpoint Presentation 3.6.2020.pdf HMLV 3/10/2020 1:00:00 PM
HJR 27
HJR027A.PDF HMLV 3/10/2020 1:00:00 PM
HJR 27