Legislature(1995 - 1996)
01/31/1995 08:05 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HSTA - 01/31/95
Number 622
HB 81 - PRESERVATION OF PUBLIC FACILITIES
CHAIR JAMES announced that she would roll HB 81 over to the next
meeting. She also said that on February 17, 1995, is an annual
meeting regarding public facilities management, which she will be
attending.
CHAIR JAMES read the Sponsor Statement, updated 1-9-95, for the
record:
The State of Alaska has 2.3 billion dollars invested in 1,717
public buildings. There is currently a gigantic deferred
maintenance backlog (Deferred Maintenance list, prepared by
the Alaska State Facilities Administrators. February 1993,
attached as exhibit #10) for these public buildings, this is
a public disgrace, our buildings are falling down around us
Statewide.
No new construction should be undertaken until we have
repaired and maintained our current facilities to an
acceptable condition. It is senseless to keep building new
facilities while our current buildings deteriorate from a
maintenance need to a replacement need.
This bill requires:
1. All deferred maintenance is to be performed over a 15
year period on all public buildings for a total
appropriation as extrapolated from the fiscal note of
$251,400,000.00 ($113,985,800.00 in the first 6 years) in
capital replacement costs, the sum of the dollars needed
is astonishing. The fiscal note for FY 95 building
operation is $61,102,700.00 and continues annually
forever, adjusted for inflation at an annual rate of 3.5
percent. The operating budget has been underfunded for
a long time and is the reason the deferred maintenance
exists.
2. All new buildings built after #1 is complete will need to
be funded by a formula program to guarantee that the new
buildings will be properly maintained.
The continuing problem of assuring the money appropriated for
maintenance goes to the maintenance is one that we must
examine and incorporate into this bill through the amendment
process.
Public facilities have been underfunded for many years, it is
sheer folly to expect our buildings to fix themselves, and to
continue to ignore this crushing need is totally
irresponsible.
The Department of Transportation and Public Facilities is the
agency I will charge with this task of repairing and replacing
our public facilities including University of Alaska
facilities.
CHAIR JAMES said that in the analysis of the bill, all deferred
maintenance on state buildings would take place over a 15 year
period. All new buildings would be constructed after all deferred
maintenance is completed. New construction will be funded by a
formula program to guarantee that they will be properly maintained.
TAPE 95-6, SIDE A
CHAIR JAMES said there are horror stories about maintenance
problems. The state needs operating expenses to avoid these
capital expenses.
Number 016
REPRESENTATIVE WILLIS concurred. He served on Military and
Veterans Affairs budget subcommittee last year and found that they
let maintenance slip. A preventative maintenance program could
take care of problems in the first instance and cost considerably
less than the repairs.
Number 050
REPRESENTATIVE ROBINSON spoke in favor of the bill, saying she
thought it was a good direction for the legislature to move toward.
She asked how the priorities would be set out and if it would be
similar to the school districts are doing now.
Number 108
CHAIR JAMES said there would be an analysis by those people who are
supposed to evaluate what is the most needed. The maintenance
would be brought current over a fifteen year period. Meanwhile, we
would be taking a life-cost basis and in the operating budget we
would be funding what that is, so we could do the keeping up while
catching up.
REPRESENTATIVE ROBINSON asked if they would repeal the way they are
handling maintenance and programs for the school districts now.
CHAIR JAMES answered that there is a dispute as to whether or not
the school districts are doing fine the way they are. They are
doing fine with new buildings, but there is an extensive amount of
deferred maintenance at this point too.
REPRESENTATIVE ROBINSON brought up a Juneau school as a follow-up
to that. The high school is in need of a new roof. Last year,
they are number 7 on the priority list, and this year they are back
down to 47. She was curious about how this would work, because at
the school district level it seems they are in this spinning wheel.
One day they are at four and next year at seven. When thinking
about public facilities, which are grantees through the Division of
Family Youth Services and through the Department of Public Safety,
she wondered if they had considered including these into the
program.
CHAIR JAMES answered, "yes," and then recalled the Fairbanks
Resource Center, which is a grantee of the state. They are
pleading with the state for money to build their own building to
avoid paying the outrageous rent they are paying; then the State
could use their operating funds for the purpose that they are
intended. However, Chair James pointed out that it does not work
that way. It costs nearly as much to own a building as it does to
rent one. This is a myth that many people hold to, but normally,
the cost of maintenance is included in the rent they pay. There
are advantages to owning a building, but it does not necessary save
money.
Number 132
REPRESENTATIVE OGAN said that CHAIR JAMES' statement was somewhat
accurate, but he would have to debate with her some on it. When
moving into a new building, maintenance would be less. When you
rent a building the amortization costs are factored in as well as
maintenance. In short term, they would have more money, but in
long term, it might cost more.
CHAIR JAMES said that there is a life cost basis for determining
how much should be used for maintenance each year. If money is put
aside on a life cost basis we would have the money when needed for
maintenance.
Number 158
REPRESENTATIVE PORTER wondered what can be done to maintain an
account for maintenance. The legislature changes every two years
and the philosophy of funding also changes.
Number 175
CHAIR JAMES asserted that the legislature cannot be forced to
appropriate funds for anything. It is up to the legislature to do
that, and every two years they are free to budget what they want.
However, the public is greatly distressed with the deferred
maintenance on our public facilities. If there was a provision in
the statutes to allow for a formula driven amount to apply to
maintenance, the general public would not allow the legislature to
turn away from the issue.
REPRESENTATIVE ROBINSON inserted that the legislature would need a
proposal to consider.
Number 200
JOHN STEINMANN, Architect, Division of Finance, Department of
Education (DOE), testified in favor of this bill. The Department
of Education is an advocate of maintenance, and there are presently
163 Rural Education Administrative Areas (REAA) and 360 city
borough sites.
CHAIR JAMES asked about a life-cost amount calculated in the amount
to do maintenance and repairs.
MR. STEINMANN said the DOE advocates a plan to work on a long term
life cycle basis.
Number 247
REPRESENTATIVE GREEN mentioned there was money in the budget for
maintenance, but it was appropriated to do other things. He was
concerned that this situation might happen again.
MR. STEINMANN wasn't prepared to answer that.
CHAIR JAMES rolled the bill over to the next meeting on Thursday,
February 2, 1995.
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