Legislature(2019 - 2020)BELTZ 105 (TSBldg)

03/10/2020 03:30 PM COMMUNITY & REGIONAL AFFAIRS

Note: the audio and video recordings are distinct records and are obtained from different sources. As such there may be key differences between the two. The audio recordings are captured by our records offices as the official record of the meeting and will have more accurate timestamps. Use the icons to switch between them.

Download Mp3. <- Right click and save file as

* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= SB 194 ADVANCED NUCLEAR REACTORS TELECONFERENCED
Moved CSSB 194(CRA) Out of Committee
-- Public Testimony --
*+ SB 218 ROAD SERVICE AREA CONSOLIDATION TELECONFERENCED
Heard & Held
-- Public Testimony --
             SB 218-ROAD SERVICE AREA CONSOLIDATION                                                                         
                                                                                                                                
3:46:10 PM                                                                                                                    
CHAIR BISHOP  called the  committee back  to order  and announced                                                               
the consideration  of SENATE  BILL NO. 218,  "An Act  relating to                                                               
road service area consolidation."                                                                                               
                                                                                                                                
3:46:32 PM                                                                                                                    
RYNNIEVA  MOSS,   Staff,  Senator  John  Coghill,   Alaska  State                                                               
Legislature,  Juneau, Alaska,  apologized  that Senator  Coghill,                                                               
bill sponsor, was attending another committee meeting.                                                                          
                                                                                                                                
She explained  that SB 218 was  introduced at the request  of the                                                               
Fairbanks  North  Star  Borough  (FNSB)  to  assist  the  borough                                                               
assembly in  figuring a timely  way to help  financially strapped                                                               
road service areas (RSAs) consolidate.                                                                                          
                                                                                                                                
3:47:11 PM                                                                                                                    
AIMEE  BUSHNELL,  Staff,  Senator   John  Coghill,  Alaska  State                                                               
Legislature,  Juneau, Alaska,  read the  class boroughs  with the                                                               
ability to consolidate  two or more road service  areas (RSAs) if                                                               
the boards representing those RSAs  request consolidations and no                                                               
new parcels are  added to the single new service  area. A service                                                               
area is a  taxing jurisdiction established at the  request of the                                                               
voters  within a  geographical area  to provide  certain services                                                               
within their  specific area.  Voters establish  their boundaries,                                                               
the maximum  mill levy imposed  on real property for  the purpose                                                               
of road  maintenance services,  and a  board that  determines the                                                               
level of road maintenance services  and directs following sponsor                                                               
statement for SB 218 [Original punctuation provided.]:                                                                          
                                                                                                                                
     Senate Bill 218 provides  second contractors to perform                                                                    
     these services.  Members of the board  are appointed by                                                                    
     the borough assembly.                                                                                                      
                                                                                                                                
     Beginning in 1972 and in  the years that followed, RSAs                                                                    
     benefited from  state shared  revenues (SSR)  for local                                                                    
     road  construction  and  improvements.  SSR  reductions                                                                    
     through the  1990s prompted RSAs  to hold  elections to                                                                    
     establish tax  revenue caps  to supplement  the reduced                                                                    
     state  funding  for  local roads.  Existing  RSAs  also                                                                    
     resisted annexations of new parcels  and roads to their                                                                    
     service areas leading to the  formation of new RSAs. Of                                                                    
     the five second  class boroughs in the  State of Alaska                                                                    
     that have  RSAs (Fairbanks, Mat-Su, Kenai,  Kodiak, and                                                                    
     Ketchikan), the  Fairbanks North  Star Borough  has, by                                                                    
     far, the most RSAs at 103.                                                                                                 
                                                                                                                                
     While   greater  efficiencies   and   lower  costs   in                                                                    
     maintaining  local  roads  could  be  achieved  through                                                                    
     consolidating  some  RSAs,  borough assemblies  do  not                                                                    
     have  the  power  to  adjust  service  area  boundaries                                                                    
     without   voter   approval.  Separate   elections   are                                                                    
     required   for   each   of    the   RSAs   subject   to                                                                    
     consolidation,  and these  elections typically  fail to                                                                    
     turn-out  voters.  Such  consolidation  would  lead  to                                                                    
     greater efficiency and  reduced costs through economies                                                                    
     of scale  and less  contract administration  by borough                                                                    
     administrators.                                                                                                            
                                                                                                                                
3:49:17 PM                                                                                                                    
CHAIR BISHOP opened invited testimony for SB 218.                                                                               
                                                                                                                                
3:49:26 PM                                                                                                                    
MICHAEL  BREDLIE,  Rural  Services  Manager,  Division  of  Rural                                                               
Services,  Department  of  Public  Works,  Fairbanks  North  Star                                                               
Borough, Fairbanks,  Alaska, testified in  support of SB  218. He                                                               
detailed that the division administers  and helps manage the RSAs                                                               
throughout  the FNSB.  As a  second-class borough,  FNSB receives                                                               
its road  construction and maintenance powers  through RSAs. FNSB                                                               
currently  has 103  separate RSAs  that maintain  a total  of 497                                                               
miles of road.                                                                                                                  
                                                                                                                                
He summarized the formation of RSAs by the FNSB as follows:                                                                     
                                                                                                                                
   • First RSA established in 1965.                                                                                             
   • Second RSA established in 1969.                                                                                            
   • 1973-1979: 20 RSAs established.                                                                                            
   • 1980s: 67 RSAs established.                                                                                                
   • 1990s: 13 RSAs established.                                                                                                
   • Final RSA established in 2002.                                                                                             
                                                                                                                                
MR.  BREDLIE  noted that  state-shared  revenues  for local  road                                                               
construction,  improvements, and  maintenance  in  the 1970s  was                                                               
$2,500 per mile and that became  the majority of revenue that the                                                               
RSAs received.  But the state-shared revenues  declined to $1,400                                                               
per  mile  in  the  1990s  and ended  altogether  in  2004.  This                                                               
prompted some RSAs  to hold elections to establish  a tax revenue                                                               
cap to supplement and ultimately replace the state-shared funds.                                                                
                                                                                                                                
3:51:57 PM                                                                                                                    
MR.  BREDLIE  said RSA  consolidation  is  a substantial  process                                                               
under current law.  Elections are required to  consolidate two or                                                               
more service  areas if  voters reside in  the affected  RSAs. The                                                               
process  requires holding  an  open house  so  residents can  ask                                                               
questions and make comments and  borough assembly approval of the                                                               
election  ordinance for  each  RSA  requesting consolidation.  He                                                               
said holding  an election for  each RSA that  needs consolidation                                                               
would be difficult at best and the costs would be substantial.                                                                  
                                                                                                                                
He  detailed that  FNSB currently  has 13  contractors that  hold                                                               
maintenance  contracts for  the  103 RSAs  in  the borough.  Some                                                               
contractors only maintain 1 RSA  while others maintain 10-20. RSA                                                               
consolidation would provide  greater efficiencies and potentially                                                               
better    prices   for    the   contractors,    reduce   contract                                                               
administration,  and   increase  RSA  on-site  presence   by  the                                                               
division to monitor road conditions.                                                                                            
                                                                                                                                
MR. BREDLIE noted  that RSA consolidation would  mean a reduction                                                               
in  available   commissioner  seats.  Currently  there   are  273                                                               
commissioners in the  426 available seats, which is  a 36 percent                                                               
vacancy rate. He concluded his  testimony reiterating that SB 218                                                               
would greatly assist FNSB in RSA consolidation.                                                                                 
                                                                                                                                
3:54:04 PM                                                                                                                    
CHAIR BISHOP  asked him to  repeat the commissioner  vacancy rate                                                               
for the RSAs.                                                                                                                   
                                                                                                                                
MR. BREDLIE restated that the  RSAs have 273 commissioners out of                                                               
a possible 426 seats, a 36 percent vacancy rate.                                                                                
                                                                                                                                
CHAIR BISHOP  said he  fully understood the  intent of  the bill,                                                               
especially from  a contracting standpoint. Having  one contractor                                                               
rather than two contractors for adjoining RSAs would save money.                                                                
                                                                                                                                
SENATOR GRAY-JACKSON asked  if FNSB must fill  the RSA commission                                                               
vacancies.                                                                                                                      
                                                                                                                                
MR.  BREDLIE  explained  that most  RSA  commissions  have  three                                                               
members  plus  one   alternate.  All  RSAs  have   at  least  one                                                               
commissioner, most  have two, and  a few have a  full commission.                                                               
He said FNSB has enough commissioners  to run its RSAs and asking                                                               
three people to volunteer for  small RSA commissions is difficult                                                               
to do.                                                                                                                          
                                                                                                                                
SENATOR  GRAY-JACKSON said  she  supports SB  218. She  explained                                                               
that her  question was  due to her  district in  Anchorage having                                                               
limited RSAs.                                                                                                                   
                                                                                                                                
SENATOR MICCICHE asked Mr. Bredlie  if he envisioned consolidated                                                               
RSAs to continue as four-person boards.                                                                                         
                                                                                                                                
MR.  BREDLIE  answered that  the  number  of commissioners  might                                                               
depend on the  size of an RSA. Large RSAs  might be a five-person                                                               
commission.  For example,  consolidating  10  smaller RSAs  might                                                               
result  in one  5-person  commission that  currently requires  30                                                               
commission members with 10 alternates.                                                                                          
                                                                                                                                
3:57:18 PM                                                                                                                    
SENATOR SHOWER joined the committee meeting.                                                                                    
                                                                                                                                
SENATOR MICCICHE  asked Ms.  Moss if  the RSAs  would have  to be                                                               
abutting.                                                                                                                       
                                                                                                                                
MS. MOSS answered  no, just in close proximity. She  related  she                                                               
has been involved with a local  RSA for 30 years and an adjoining                                                               
service area  uses a different  contractor. Both  contractors are                                                               
located  across town,  so a  consolidation  in that  circumstance                                                               
could result in cost savings.                                                                                                   
                                                                                                                                
She explained that  the bill is written to protect  RSAs that are                                                               
functioning very well. She detailed  that the RSA she is involved                                                               
with expanded  twice within the  last 10 years which  doubled the                                                               
road miles.  This RSA has been  able to save over  $100,000 which                                                               
was used as a federal match to  get the roads in the service area                                                               
resurfaced. She  reiterated that the  bill does not  disturb RSAs                                                               
that are doing their job.                                                                                                       
                                                                                                                                
3:59:10 PM                                                                                                                    
MARNA  SANFORD, Assembly  Member,  Fairbanks  North Star  Borough                                                               
Assembly, Fairbanks, Alaska, testified in  support of SB 218. She                                                               
advised that she  is the chair of the Assembly  Road Service Area                                                               
Committee (ARSAC)  that includes members  from seven of  the RSAs                                                               
within the FNSB.                                                                                                                
                                                                                                                                
MS. SANFORD  explained that FNSB is  seeking legislative guidance                                                               
due  to extremely  low  voter  turnout. If  two  boards agree  to                                                               
consolidate and few  people vote in the RSA  election, one family                                                               
could potentially upset  a consolidation for the  betterment of a                                                               
larger area.                                                                                                                    
                                                                                                                                
MS. SANFORD  summarized that SB  218 gives boards and  the people                                                               
working  on   the  ground  the  ability   to  make  consolidation                                                               
decisions and bring  something forward to the  FNSB assembly. RSA                                                               
consolidation is a  Fairbanks issue and the bill is  a great step                                                               
in the right direction. Should  the legislation pass, ARSAC would                                                               
identify the best cases for  consolidation to help streamline the                                                               
administration and costs for all RSAs.                                                                                          
                                                                                                                                
CHAIR BISHOP asked what it costs to run an election.                                                                            
                                                                                                                                
MS. SANFORD  replied she could  not recall  the cost of  the last                                                               
election.                                                                                                                       
                                                                                                                                
CHAIR BISHOP asked her to follow up with the information.                                                                       
                                                                                                                                
SENATOR  SHOWER noted  Ms. Sanford's  statement  that one  family                                                               
could  swing  an  election  and pointed  out  that  the  republic                                                               
designed  the electoral  system to  work where  one person  could                                                               
swing an  election. He said  that process encourages  more people                                                               
to vote  and that  was a  good thought.  He said  the legislature                                                               
should not create policy simply  because a few people might swing                                                               
an election, a concept that he  was sure Ms. Sanford did not mean                                                               
to support.                                                                                                                     
                                                                                                                                
4:02:20 PM                                                                                                                    
SENATOR MICCICHE suggested that  neighborhood-sized RSAs may be a                                                               
Fairbanks issue. He  said getting people to apply  for RSA boards                                                               
is always a problem  but he has more to learn  about the issue in                                                               
the Fairbanks area before coming to any conclusion.                                                                             
                                                                                                                                
4:02:57 PM                                                                                                                    
CHAIR BISHOP held SB 218 in committee for further consideration.                                                                

Document Name Date/Time Subjects
SB 194 Draft CS ver. M.pdf SCRA 3/10/2020 3:30:00 PM
SB 194
SB 194 Explanation of Changes ver A to M.pdf SCRA 3/10/2020 3:30:00 PM
SB 194
SB 194 Sponsor Statement.pdf SCRA 3/3/2020 3:30:00 PM
SCRA 3/10/2020 3:30:00 PM
SB 194
SB 194 DRAFT Fiscal Note DEC-CO 03-02-2020.pdf SCRA 3/3/2020 3:30:00 PM
SCRA 3/10/2020 3:30:00 PM
SB 194
SB 218 Sponsor Statement 3.2.2020.pdf SCRA 3/10/2020 3:30:00 PM
SCRA 3/17/2020 3:30:00 PM
SB 218
SB 218 Map Fairbanks North Star Borough Service Areas 3.3.2020.pdf SCRA 3/10/2020 3:30:00 PM
SCRA 3/17/2020 3:30:00 PM
SB 218
SB 218 Letter of Support Mayor Ward 3.3.2020.pdf SCRA 3/10/2020 3:30:00 PM
SCRA 3/17/2020 3:30:00 PM
SB 218
SB 218 Draft Fiscal Note DCCED-DCRA- 03-06-20.pdf SCRA 3/10/2020 3:30:00 PM
SCRA 3/17/2020 3:30:00 PM
SB 218