Legislature(2003 - 2004)

03/20/2003 09:07 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                                                                                                                                
     SENATE BILL NO. 100                                                                                                        
     "An  Act making capital  appropriations  and reappropriations;                                                             
     capitalizing a fund;  making appropriations under art. IX, sec.                                                            
     17(c),   Constitution  of  the   State  of  Alaska,   from  the                                                            
     constitutional   budget reserve  fund;  and  providing  for  an                                                            
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
This was the fourth hearing for this bill in the Senate Finance                                                                 
Committee.                                                                                                                      
                                                                                                                                
Department of Public Safety                                                                                                   
                                                                                                                                
[Note: The Department of Public Safety FY 04 capital project                                                                    
presentation is a continuation from the March 19, 2003 meeting.]                                                                
                                                                                                                                
     Fairbanks  Public  Safety  Bldg  -  Indoor  Firing  Range  Lead                                                            
     Removal                                                                                                                    
     $ 66,000 General Funds                                                                                                     
     Reference No.: 37779                                                                                                       
     Project Type: Renewal and Replacement                                                                                      
     Category: Public Protection                                                                                                
     Location: Fairbanks (University, Ester)                                                                                    
     Election District: Unidentified Election District                                                                          
     Estimated Project Dates: 07/01/2003 - 06/30/2005                                                                           
     One-Time Project                                                                                                           
     The Department  of Public Safety building in  Fairbanks (state-                                                            
     owned)  requires  removal  of toxic  lead contaminants  in  the                                                            
     indoor firing range.                                                                                                       
                                                                                                                                
KAREN  MORGAN,  Director,   Division  of  Administrative   Services,                                                            
Department of  Public Safety stated that this request  would provide                                                            
funds  to clean  up toxic  lead contamination  associated  with  the                                                            
firing range in the Fairbanks' public safety facility.                                                                          
                                                                                                                                
     APSIN Redesign Implementation Phases 4 and 5                                                                               
     $ 8,000,000 Federal Receipts                                                                                               
     Reference No.: 37719                                                                                                       
     Project Type: Information Systems                                                                                          
     Category: Public Protection                                                                                                
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Phased Project                                                                                                             
     The  Alaska Public  Safety Information  Network (APSIN)  serves                                                            
     over 2,600  local, state, and  federal criminal justice  users.                                                            
     It's  based on obsolete  1980s technology.  The current  system                                                            
     has  been updated  to  meet minimal  requirements  for the  new                                                            
     National  Crime Information  Center (NCIC)  2000 requirements,                                                             
     but  unless the  State implements  a  modern, fully-integrated                                                             
     system,  Alaska will  not have  an effective  criminal  justice                                                            
     information system.  Federal grant funds have been received for                                                            
     this  project, and this  request is  for capital authorization                                                             
     for those  funds. The total request will also  allow for future                                                            
     expected federal awards.                                                                                                   
                                                                                                                                
Ms. Morgan explained  that this request would allow  the continuance                                                            
of  a  multi-phased  project  to  update  the Department's   primary                                                            
criminal  justice  information  system  in  order  to  meet  federal                                                            
standards  pertaining to  criminal history  data and reporting.  She                                                            
stated that  this update would allow  information to be accessed  by                                                            
local, state, and national  enforcement agencies. She noted that the                                                            
system requirement  analysis phase has been completed  and that this                                                            
phase would address system design.                                                                                              
                                                                                                                                
Co-Chair  Wilken asked whether  these funds  would be sufficient  to                                                            
complete the project.                                                                                                           
                                                                                                                                
Ms. Morgan  voiced  uncertainty as  to whether  the requested  funds                                                            
would complete the design  phase of the project. She shared that the                                                            
Department calculates  the expense of each phase on  the information                                                            
gathered from  previous phases. She  furthered that the next  phase,                                                            
or "actual development"  phase, is expected to require approximately                                                            
three million dollars.                                                                                                          
                                                                                                                                
Co-Chair Wilken asked whether  a State match is required in order to                                                            
receive the federal funds.                                                                                                      
                                                                                                                                
Ms. Morgan responded  that a State match is optional.  She continued                                                            
that, were the  State to allocate funds to this project,  they would                                                            
be appropriated from the  Department's general fund operating budget                                                            
appropriation.                                                                                                                  
                                                                                                                                
     Marine Fisheries Patrol Improvements                                                                                       
     $ 1,080,320 Federal Receipts                                                                                               
     Reference No.: 35825                                                                                                       
     Project Type: Health and Safety                                                                                            
     Category: Public Protection                                                                                                
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 10/01/2003 - 09/30/2004                                                                           
     On-Going Project                                                                                                           
     The  Alaska  State  Legislature  urged  the  Division  to  seek                                                            
     additional  funds for its patrol  efforts in Federal  waters of                                                            
     the North  Pacific Ocean and the Bering Sea.  This project is a                                                            
     result  of  lengthy  negotiations   with  the  National  Marine                                                            
     Fisheries  Service. Federally regulated marine  fisheries occur                                                            
     on a  year round basis  in the coastal  and offshore waters  of                                                            
     the  State of Alaska.  Both the Federal  and State Governments                                                             
     share an interest in ensuing these fisheries are protected.                                                                
                                                                                                                                
Ms. Morgan  explained  that the  federal funding  authority of  this                                                            
request is,  at this time,  "doubtful," as  it "may be diverted,  in                                                            
whole or  in part" to national  homeland  security. She stated  that                                                            
the request is being presented in case funds become available.                                                                  
                                                                                                                                
     Statewide Illegal Drug and Alcohol Use                                                                                     
     $ 2,000,000 Federal Receipts                                                                                               
     Reference No.: 38477                                                                                                       
     Project Type: Health and Safety                                                                                            
     Category: Public Protection                                                                                                
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 10/01/2003 - 09/30/2005                                                                           
     One-Time Project                                                                                                           
     Rural  Alaska continues  to  suffer serious,  life threatening                                                             
     effects  from use of  illicit drugs  and alcohol. This  federal                                                            
     grant  will allow  the state  to enhance the  efforts of  state                                                            
     troopers,  local law enforcement, and community  policing teams                                                            
     to reduce  illicit drugs and alcohol. The use  of these illicit                                                            
     substances  increases the prevalence of violent  crimes such as                                                            
     homicide,  sexual assaults, robberies,  burglaries and  serious                                                            
     domestic violence assaults in rural Alaska.                                                                                
                                                                                                                                
Ms. Morgan stated that  this request pertains to a continuation of a                                                            
project to  address illicit drug and  alcohol use in the  State. She                                                            
communicated that, "indications  are" that these federal funds would                                                            
continue to be available to the State.                                                                                          
                                                                                                                                
     Rural Law Enforcement Training and Equipment                                                                               
     $ 1,500,000 Federal Receipts                                                                                               
     Reference No.: 38479                                                                                                       
     Project Type: Health and Safety                                                                                            
     Category: Public Protection                                                                                                
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 09/30/2005                                                                           
     One-Time Project                                                                                                           
     The  Department  of  Justice,  Office   of Community   Oriented                                                            
     Policing  Services will  be awarding  the Alaska Department  of                                                            
     Public Safety $1,500,000  to train law enforcement personnel in                                                            
     rural locations  to increase their ability to  deal with crisis                                                            
     situations  and to purchase equipment  for better responses  to                                                            
     emergencies                                                                                                                
                                                                                                                                
Ms. Morgan  stated  that the Department  has  received this  federal                                                            
funding in  the past and anticipates  receipt of them in  FY 04. She                                                            
stated  that  these  funds  would  be  used  primarily   to  support                                                            
"community  oriented policing services  throughout Alaska"  with the                                                            
focus to provide  training to local law enforcement  personnel, such                                                            
as Village Public Safety Officers, in rural locations.                                                                          
                                                                                                                                
Co-Chair Wilken observed  that the projected FY 04 funding amount is                                                            
almost triple the FY 03 funding level.                                                                                          
                                                                                                                                
Ms.  Morgan  understood   that  these  federal  receipts   would  be                                                            
allocated over several years.                                                                                                   
                                                                                                                                
     Communications' Systems Upgrade                                                                                            
     $ 1,500,000 Federal Receipts                                                                                               
     Reference No.: 38511                                                                                                       
     Project Type: Equipment                                                                                                    
     Category: Public Protection                                                                                                
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2006                                                                           
     Phased Project - Underway                                                                                                  
     State Match Required                                                                                                       
     The  Department  of  Justice,  Office   of Community   Oriented                                                            
     Policing  Services, Law Enforcement Technology  Program will be                                                            
     awarding  $1,500,000 to the Alaska Department  of Public Safety                                                            
     (DPS)  to upgrade its  communications'  systems. DPS will  work                                                            
     the  Alaska  Department  of Administration  (DOA)  to  continue                                                            
     coordination  of this project. It may be spent  on DPS-specific                                                            
     emergency communications  equipment, or on contracts related to                                                            
     the department's emergency  communications' needs. DPS may also                                                            
     contract  with DOA utilizing  funding from this project  for an                                                            
     intra-  and inter-jurisdictional  strategy  for communications                                                             
     interoperability among  federal, state, and local public safety                                                            
     first responders in Alaska.                                                                                                
                                                                                                                                
Ms. Morgan stated  that this funding would allow for  the continuing                                                            
implementation of the Alaska  Land Mobile Radio (ALMR) communication                                                            
project. She continued  that while the funds would primarily be used                                                            
to purchase equipment  for the Department of Public  Safety, related                                                            
ALMR related services  provided by the Department  of Administration                                                            
would  also be  funded.  She  voiced confidence  that  this  federal                                                            
funding would  be forthcoming, and  she specified that the  required                                                            
State match would  be provided by the Department of  Administration.                                                            
She stated  that the Department of  Public Safety would receive  the                                                            
federal  funds   and  that  an  inter-agency   agreement   would  be                                                            
established with the Department of Administration.                                                                              
                                                                                                                                
Co-Chair  Wilken asked  for further  information  regarding how  the                                                            
purchase of this equipment relates to the ALMR project.                                                                         
                                                                                                                                
Ms. Morgan  shared that  the equipment  would improve communication                                                             
abilities between various law enforcement entities.                                                                             
                                                                                                                                
JULIE  STINSON,   Department   of  Administration,   testified   via                                                            
teleconference  from an offnet site to state that  these funds would                                                            
primarily  address  the need  to enhance  State  Trooper  equipment;                                                            
specifically to  provide radios that would comply  with the new ALMR                                                            
system and would expand coverage areas.                                                                                         
                                                                                                                                
Ms. Morgan informed the  Committee that another Department of Public                                                            
Safety  capital project  request  is included  on page  47, lines  5                                                            
through 11 in Section 7  of the bill, Version 23-GS1003\A that reads                                                            
as follows.                                                                                                                     
                                                                                                                                
     Sec. 7. DEPARTMENT  OF PUBLIC SAFETY. (a) The proceeds from the                                                            
     sale of four  Department of Public Safety aircraft  and surplus                                                            
     aircraft  parts  and  accessories  are  appropriated  from  the                                                            
     general  funds  to the  Department  of  Public Safety  for  the                                                            
     purchase  of replacement aircraft or for aircraft  maintenance.                                                            
          (b) The proceeds from the sale of one vessel and surplus                                                              
     vessel parts and accessories  are appropriated from the general                                                            
     funds  to the Department of Public  Safety for the purchase  of                                                            
     replacement vessels or for vessel maintenance.                                                                             
                                                                                                                                
Ms. Morgan stated that  this language would provide the authority to                                                            
use the proceeds  from the sale of an aircraft and  surplus aircraft                                                            
parts and accessories  to be combined  with previously appropriated                                                             
funds to purchase a replacement aircraft.                                                                                       
                                                                                                                                
Department of Revenue                                                                                                         
                                                                                                                                
DAN  FAUSKE,   CEO/Executive   Director,   Alaska  Housing   Finance                                                            
Corporation,   Department  of  Revenue  stated   that  while  he  is                                                            
available to  answer questions, the  Corporation's Budget  Director,                                                            
Les  Campbell,  would  be  presenting  the  Alaska  Housing  Finance                                                            
Corporation's (AHFC) capital budget project requests.                                                                           
                                                                                                                                
BRYAN  BUTCHER,   Legislative   Liaison,   Alaska  Housing   Finance                                                            
Corporation,  Department of  Revenue attended  and was available  to                                                            
answer questions.                                                                                                               
                                                                                                                                
     Housing Loan Program/Teacher/Health Professionals Housing                                                                  
     $ 4,300,000 Corporate Receipts                                                                                             
     Reference No.: 37918                                                                                                       
     Project Type: Transitional                                                                                                 
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Housing Loan Program/Teacher  Housing utilizes Corporate (AHFC)                                                            
     funds   to  supplement   the  Corporation's   popular   housing                                                            
     programs.  This  new  program  will  help  replace diminishing                                                             
     arbitrage  funds.  These  funds  will allow  AHFC  to  continue                                                            
     current  programs and  expand business  opportunities with  new                                                            
     Teacher  Housing Program(s)  and Health  Professionals  Housing                                                            
     Program(s).  It will also provide funds to support  a statewide                                                            
     housing conference.                                                                                                        
                                                                                                                                
LES CAMPBELL,  Budget Director, Alaska Housing Finance  Corporation,                                                            
Department  of  Revenue   reviewed  the  Corporation's   success  in                                                            
managing  arbitrage  funds to  provide  low interest  rate  mortgage                                                            
loans  to low-income  people,  senior  citizens, and  special  needs                                                            
populations.  He stated that this  new program would enable  AHFC to                                                            
continue  to offer  a program  that has  previously  been funded  by                                                            
arbitrage  funds. In addition,  he noted that  the program  would be                                                            
expanded  to provide  low  interest housing  loans  to teachers  and                                                            
health professionals.                                                                                                           
                                                                                                                                
     Supplemental Housing Development Program                                                                                   
     $ 4,500,000 Corporate Receipts                                                                                             
     Reference No.: Ref 6323                                                                                                    
     Project Type: Construction                                                                                                 
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2002 - 06/30/2008                                                                           
     Supplemental  Housing  Development Program  - Corporate  (AHFC)                                                            
     funds  to supplement Federal  (HUD) funds to construct  decent,                                                            
     safe and sanitary  housing through regional housing authorities                                                            
     established  under  AS  18.55.996.  Funds  are  used  to  cover                                                            
     housing development  costs related to water distribution, sewer                                                            
     hookups,    electrical   distribution    systems,    and   road                                                            
     construction  to  project site,  site development,  and  energy                                                            
     efficiency  improvements.  State laws  limit the  use of  these                                                            
     funds  to 20% of  the HUD's  total development  cost per  unit.                                                            
     These funds  are prohibited from being used for  administrative                                                            
     or other costs of the housing authority.                                                                                   
                                                                                                                                
Mr. Campbell read  the project description as specified  on page 3-5                                                            
of the "Alaska Housing  Finance Corporation Executive Budget Summary                                                            
'Results-Oriented'  Proposed  FY 2004 Draft  Capital Budget,"  dated                                                            
March 11,2003 [copy on file].                                                                                                   
                                                                                                                                
Co-Chair Wilken asked whether  a list of the identified projects has                                                            
been provided to the Committee.                                                                                                 
                                                                                                                                
Mr. Campbell responded  that the funds would be provided directly to                                                            
the  Regional  Housing Authorities  who  have  developed  a list  of                                                            
projects. He  furthered that the funding  mechanism of this  program                                                            
is  the  Native  American  Housing  Self  Determination  Act  (HSDA)                                                            
program. He stated  that a total of approximately  $50 million would                                                            
be  appropriated  to  build  new housing  projects  in  rural  areas                                                            
through this program.                                                                                                           
                                                                                                                                
Co-Chair  Wilken  referred  to the  list  of projected  outcomes  as                                                            
specified on  page 3-5 of the report,  and he asked the identity  of                                                            
the  20 communities  in  which the  400  affordable  homes would  be                                                            
built, as referenced in that list.                                                                                              
                                                                                                                                
Mr. Campbell  responded that  AHFC has received  a list of  projects                                                            
that meet the  eligibility requirements  of this funding.  He stated                                                            
that the list amounts to  $11,710,000, and he noted that, due to the                                                            
limited funding, projects would be chosen from that list.                                                                       
                                                                                                                                
Co-Chair  Wilken  surmised,  therefore,  that AHFC  would  determine                                                            
which projects on the list would receive the funding.                                                                           
                                                                                                                                
Mr. Campbell concurred.                                                                                                         
                                                                                                                                
Co-Chair  Wilken asked that  a copy of the  list be provided  to the                                                            
Committee.                                                                                                                      
                                                                                                                                
     Low-Income Weatherization Program                                                                                          
     $ 5,800,000                                                                                                                
          $ 1,800,000 Federal Receipts                                                                                          
          $ 4,000,000 Corporate Receipts                                                                                        
     Reference No.: 6332                                                                                                        
     Project Type: Renovation and Remodeling                                                                                    
     Category: Housing / Social Services                                                                                        
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Low Income  Weatherization Program  - Federal US Department  of                                                            
     Energy  (DOE) and  Corporate (AHFC)  funds to  assist low-  and                                                            
     moderate-income  families attain  decent, safe, and  affordable                                                            
     housing  through  the  weatherization   and  rehabilitation  of                                                            
     existing   homes.  Weatherization  provides   for  fire  safety                                                            
     through furnace and  electrical repairs, education, chimney and                                                            
     woodstove   repairs,  and  egress  windows  (installed   during                                                            
     bedroom window replacements).                                                                                              
                                                                                                                                
Mr. Campbell read the project  description as denoted on page 3-7 of                                                            
the Report.                                                                                                                     
                                                                                                                                
Senator  Bunde  asked   whether  the  Regional  Funding   Allocation                                                            
information, as  referenced in the Report on page  3-8, reflects the                                                            
allocation of the total amount of the FY 04 request.                                                                            
                                                                                                                                
Mr. Campbell  responded yes, and he  stated that the proposed  FY 04                                                            
funding percentages mirrors those of previous years.                                                                            
                                                                                                                                
Co-Chair  Wilken asked  whether the  federal match  portion of  this                                                            
request is affected by  the AHFC dividend that is paid to the State.                                                            
                                                                                                                                
Mr. Campbell stated that  there is no direct AHFC match required for                                                            
this request.  He noted  that the  federal funds  received would  be                                                            
directly passed through to the Regional Housing Authorities.                                                                    
                                                                                                                                
Co-Chair Wilken pointed  out that the federal funding history of the                                                            
program is random from year to year.                                                                                            
                                                                                                                                
Mr.  Campbell  responded  that  the  weatherization   program  would                                                            
receive $1.8  million in federal funding  regardless of Legislative                                                             
action.                                                                                                                         
                                                                                                                                
Mr. Campbell  noted that  due to [unspecified]  restrictions  on the                                                            
federal  weatherization  program, Corporate  funds  are required  to                                                            
enable  the weatherization  program  to be  offered  on a  statewide                                                            
basis.                                                                                                                          
                                                                                                                                
     Senior Citizen's Housing Development Fund (SCHDF)                                                                          
     $ 2,000,000 Corporate Receipts                                                                                             
     Reference No.: 6334                                                                                                        
     Project Type: Transitional                                                                                                 
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Senior Citizens Housing  Development Program - Corporate (AHFC)                                                            
     funds   for  the  development   of   senior  citizen   housing.                                                            
     Competitively  awarded grants are provided for  the purchase of                                                            
     building sites, site  preparation, materials, construction, and                                                            
     rehabilitation of  existing housing. Organizations qualified to                                                            
     apply  include municipalities  and public or private  nonprofit                                                            
     corporations.   Additional   components   include  grants   for                                                            
     accessibility  modifications to senior homes  and grants (up to                                                            
     $25,000)   for  nonprofit  senior  organizations   to  pay  for                                                            
     preparation   of  plans   and  project   feasibility   studies,                                                            
     appraisals, site preparation, and other pre-development                                                                    
     activities.                                                                                                                
                                                                                                                                
Mr. Campbell read  the project description as specified  on page 3-9                                                            
of the Report.                                                                                                                  
                                                                                                                                
Senator Bunde  asked that further information be provided  regarding                                                            
applicant qualifications  and specifics as to how  the loan would be                                                            
applied to a successful applicant.                                                                                              
                                                                                                                                
Mr.  Campbell  responded that  this  "Gold  Program" could  award  a                                                            
successful  applicant "a  tax credit  from the home  program  or the                                                            
senior  housing program."  He  stated that,  in addition,  this  tax                                                            
credit could be combined  with a loan mortgage from the Corporation.                                                            
He  stated that  the  Senior Housing  program  is included  in  this                                                            
program in order to make the overall program "viable."                                                                          
                                                                                                                                
Senator Bunde  asked for further information regarding  the benefits                                                            
awarded to an applicant.                                                                                                        
                                                                                                                                
Mr. Campbell stated  that to qualify for the program,  the applicant                                                            
must be a non-profit  entity or a  municipality. He stated  that the                                                            
funds must be used to build senior housing.                                                                                     
                                                                                                                                
Senator  Bunde  surmised therefore  that  once  a senior  meets  the                                                            
requirements  and is placed  on the needs  list, a non-profit  would                                                            
build the housing.  He asked what  the senior's obligation  would be                                                            
at that point.                                                                                                                  
                                                                                                                                
Mr.   Campbell   responded   that   each   program   has   different                                                            
requirements.  He exampled that the tax credit program  has specific                                                            
income level requirements.                                                                                                      
                                                                                                                                
Mr. Fauske  interjected that federal  guidelines for the  tax credit                                                            
program include  the requirement that the senior be  55 years of age                                                            
as compared  to a minimum age of 60  as required by AHFC.  He stated                                                            
that  there are  a variety  of income  restrictions  offered in  the                                                            
various programs, and he  attested that AHFC works with entities and                                                            
attempts  to "blend" the  funding to allow  the various projects  to                                                            
work.                                                                                                                           
                                                                                                                                
Senator Bunde  surmised therefore,  that this program would  benefit                                                            
someone such as a senior who has a low income.                                                                                  
                                                                                                                                
Mr. Fauske concurred.                                                                                                           
                                                                                                                                
Senator  Bunde stated  that his questioning  is  an attempt to  show                                                            
that  housing  programs  are  available  to assist  seniors,  as  he                                                            
asserted,  it is being  argued that  the elimination  of the  senior                                                            
citizens'  Longevity  Bonus  Program  would "throw  seniors  in  the                                                            
streets."                                                                                                                       
                                                                                                                                
Mr.  Campbell noted  that  the housing  for  seniors  that would  be                                                            
provided  in  this  legislation  would  be by  the  private  sector.                                                            
Furthermore,  he pointed out that,  as such, the State would  not be                                                            
responsible for the building's operation.                                                                                       
                                                                                                                                
Mr. Fauske stated that  in anticipation of a change in the Longevity                                                            
Bonus Program,  AHFC investigated  the affect  that the loss  of the                                                            
longevity bonus might have  on senior participants who occupy public                                                            
housing   through   AHFC.  He   furthered   that,   based  on   AHFC                                                            
calculations, the loss  of the Bonus would lower the senior's income                                                            
level,  and thereby  would  lower the  senior's rent  obligation  by                                                            
approximately $80 per month.                                                                                                    
                                                                                                                                
Co-Chair  Wilken  voiced  concern  that  the  cost  of  the  housing                                                            
projects  as  identified  on page  3-10  in the  Report  equates  to                                                            
approximately $225,000 per unit.                                                                                                
                                                                                                                                
Mr. Campbell  recognized the expense  as fairly accurate.  He stated                                                            
that the grant cost per  unit for AHFC is approximately $19,531, and                                                            
he continued  that  other  funding sources  also  contribute to  the                                                            
effort.                                                                                                                         
                                                                                                                                
Co-Chair  Wilken asked whether  the Cook  Inlet Housing Authority's                                                             
Anchorage project  that is identified  in this request on  page 3-10                                                            
is a renovation or new construction project.                                                                                    
                                                                                                                                
Mr.  Campbell  specified  that  the  Cook  Inlet  Housing  Authority                                                            
project is new construction.                                                                                                    
                                                                                                                                
Co-Chair  Wilken stated  that at $225,000  per unit,  these must  be                                                            
"wonderful" units.                                                                                                              
                                                                                                                                
Mr.  Fauske  clarified  that  the  expenses   include  the  cost  of                                                            
constructing  community  centers and  buildings in  addition to  the                                                            
unit cost. He  agreed that these are expensive projects  to develop;                                                            
however, he stated that attempts are made to hold costs down.                                                                   
                                                                                                                                
Co-Chair  Wilken responded  that he recently  purchased a unit  in a                                                            
complex  with a  community  center and  comfortable  amenities at  a                                                            
lower  price than  this. Therefore,  he  continued  to question  the                                                            
cost.                                                                                                                           
                                                                                                                                
Mr.  Fauske  stated  that AHFC  would  provide  the  Committee  with                                                            
additional information regarding these costs.                                                                                   
                                                                                                                                
     HUD Federal HOME Grant Program                                                                                             
     $ 3,909,000                                                                                                                
          $ 3,159,000 Federal Receipts                                                                                          
          $   750,000 Corporate Receipts                                                                                        
     Reference No.: 6347                                                                                                        
     Project Type: Renewal and Replacement                                                                                      
     Category: Housing / Social Services                                                                                        
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     HUD  Federal HOME  Grant Program  utilizes  Federal (HUD)  with                                                            
     Corporate  matching   (AHFC)  funds  for  the  HOME  Investment                                                            
     Partnership  Program.  The purpose  of the HOME  program  is to                                                            
     expand  the supply  of affordable,  low-  and moderate-  income                                                            
     housing  and to strengthen  the State's  ability to design  and                                                            
     implement  strategies to  achieve an  adequate supply  of safe,                                                            
     energy -efficient,  and affordable housing. The Municipality of                                                            
     Anchorage has their own separate HOME program.                                                                             
                                                                                                                                
Mr.  Campbell  noted that  the  $750,000  in  Corporate funds  is  a                                                            
required  match to receive  the federal funds.  He read the  project                                                            
description as specified on page 3-11.                                                                                          
                                                                                                                                
     HUD Capital Fund Program (formerly CGP)                                                                                    
     $ 500,000 Federal Receipts                                                                                                 
     Reference No.: 6342                                                                                                        
     Project Type: Renewal and Replacement                                                                                      
     Category: Housing / Social Services                                                                                        
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     HUD Capital  Fund Program (CFP)(formerly CGP)  utilizes Federal                                                            
     (HUD)  grant  that provides  Public  Housing  Authorities  with                                                            
     funds each  year to help renovate and modernize  public housing                                                            
     units. Funds also  provide for administrative expenses, tenant-                                                            
     education   projects,  drug  elimination/safety   projects  and                                                            
     management improvements.                                                                                                   
                                                                                                                                
Mr. Campbell read  the project description as provided  on page 3-13                                                            
of  the  Report.  He  noted  that  the  federal   funding  level  is                                                            
determined by  a formula based on the number and types  of units. He                                                            
stated  that the  historical Congressional  appropriation  for  this                                                            
fund is approximately  $3,500,000  of which $3 million is  bondable.                                                            
He stated that this request provides for the non-bondable funds.                                                                
                                                                                                                                
Senator Bunde  noted that  information on  page 3-14 specifies  that                                                            
management  improvements  and operations  would  be  funded in  this                                                            
appropriation.   Therefore,  he  asked   what  resident   management                                                            
training would include.                                                                                                         
                                                                                                                                
Mr. Campbell responded  that resident councils would  be established                                                            
at each development,  and that the  funds would assist in  educating                                                            
the Council members to  function as a team for the betterment of the                                                            
development.  Furthermore, he  stated that  such things as  computer                                                            
training could also be provided to the Council.                                                                                 
                                                                                                                                
     Federal and Other Competitive Grants                                                                                       
     $ 4,250,000                                                                                                                
          $1,250,000 Corporate Receipts                                                                                         
          $3,000,000 Federal Receipts                                                                                           
     Reference No.: 6348                                                                                                        
     Project Type: Health and Safety                                                                                            
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Federal and  Other Competitive Grants - utilizes  Federal (HUD)                                                            
     and  Corporate match  (AHFC) grant funds.  AHFC will apply  for                                                            
     grants that target  the housing needs of low income and special                                                            
     needs  groups;  such  as senior  citizens,  the  mentally  ill,                                                            
     physically,  or developmentally disabled or the  homeless. AHFC                                                            
     will  also apply for  energy related grants  as they relate  to                                                            
     housing.  When acquired, AHFC will provide the  needed matching                                                            
     funds. Some of the  grant funds received will be passed through                                                            
     to  local non-profit  sub-grantee  organizations  that  deliver                                                            
     housing and/or services.                                                                                                   
                                                                                                                                
Mr. Campbell stated that  the Corporate receipt-funding portion is a                                                            
required  federal  fund  match.  He  read  the  project  summary  as                                                            
specified on page 3-15 of the Report.                                                                                           
                                                                                                                                
Co-Chair  Green requested  that, when matching  funds are  required,                                                            
language reflecting the  match requirement should be included in the                                                            
Report.                                                                                                                         
                                                                                                                                
Mr. Campbell  acknowledged the request.  He stated that while  match                                                            
requirements  differ, the  average requirement  is approximately  25                                                            
percent.                                                                                                                        
                                                                                                                                
Co-Chair  Green referred  to the  Report's presentation  format  and                                                            
concluded  that  the  inclusion  of  language  that  specifies  both                                                            
Corporation  and  Federal  Receipts   when  referring  to  "FY  2004                                                            
Funding" would indicate that a match is required.                                                                               
                                                                                                                                
Co-Chair  Wilken  surmised  that in  this  request, the  State  must                                                            
supply $1,250,000  in order to receive $3 million  in federal funds.                                                            
Furthermore,  he noted  that an  amount less  than $1,250,000  would                                                            
result in a lower federal funding level.                                                                                        
                                                                                                                                
Mr. Campbell concurred.                                                                                                         
                                                                                                                                
Senator Taylor  noted that the program  match amounts, as  indicated                                                            
in the  Funding History  on page 3-15,  reflect "fluctuating"  match                                                            
amounts. He asked for further information regarding this.                                                                       
                                                                                                                                
Mr. Campbell  responded that while  funds are expected, there  is no                                                            
guarantee  that the  funds would  be forthcoming,  nor, he  advised,                                                            
could  it be  assured  that  the match  level  would be  a  constant                                                            
factor.                                                                                                                         
                                                                                                                                
     Competitive Grants for Public Housing                                                                                      
     $ 1,000,000                                                                                                                
          $250,000 Corporate Receipts                                                                                           
          $750,000 Federal Receipts                                                                                             
     Reference No.: 6350                                                                                                        
     Project Type: Health and Safety                                                                                            
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Competitive Grants  for Public Housing - utilizes Federal (HUD)                                                            
     and  Corporate match  (AHFC) grant funds.  AHFC will apply  for                                                            
     HUD  grants that  target the  housing needs  of low-income  and                                                            
     special  needs groups;  such as senior  citizens, the  mentally                                                            
     ill,  disabled,  or the  homeless.  AHFC  will also  apply  for                                                            
     grants to  prevent crime and substance abuse  in public housing                                                            
     and assist public  housing families in attaining economic self-                                                            
     sufficiency.  When  required,  AHFC  will  provide  the  needed                                                            
     match.  Some of the  funds received will  be passed through  to                                                            
     local   non-profit  sub-grantee   organizations  that   deliver                                                            
     housing and/or services.                                                                                                   
                                                                                                                                
Mr. Campbell read  the project summary. He stated  that this request                                                            
specifically targets low-income housing needs.                                                                                  
                                                                                                                                
Co-Chair  Green asked whether  the reference  to Competitive  grants                                                            
infers that AHFC  competes for these grants on the  federal level or                                                            
whether  the local  organizations  compete to  receive these  grants                                                            
from AHFC.                                                                                                                      
                                                                                                                                
Mr. Campbell  clarified that AHFC  would be required to compete  for                                                            
these grants.                                                                                                                   
                                                                                                                                
Senator Taylor  asked for  examples "of grants  which prevent  crime                                                            
and substance abuse in public housing."                                                                                         
                                                                                                                                
Mr. Campbell  shared that the HUD  drug elimination grant  addresses                                                            
security issues  in addition to offering programs  that would assist                                                            
residents in resisting or "getting off" substance abuse.                                                                        
                                                                                                                                
Senator Taylor  questioned AHFC's involvement in offering  substance                                                            
abuse programs,  as he attested,  this is  usually the role  of such                                                            
entities as the Division of Drug and Alcohol Abuse.                                                                             
                                                                                                                                
Mr.  Campbell  explained  that these  HUD  grants  are specifically                                                             
designated  to provide  substance  abuse program  in public  housing                                                            
facilities.                                                                                                                     
                                                                                                                                
WES  WEIR, Director,  Division  of Public  Housing,  Alaska  Housing                                                            
Finance  Corporation, Department  of  Revenue, noted  that the  Drug                                                            
Elimination  grant would  provide "direct  grants" to agencies  that                                                            
would  provide  such  things  as  adult  programs  and after-school                                                             
activities for youth to  assist in offsetting opportunities for drug                                                            
use in public housing facilities.                                                                                               
                                                                                                                                
Senator Taylor  asked the success rate of the program;  specifically                                                            
how the program success rate is monitored.                                                                                      
                                                                                                                                
Mr. Weir  noted that while  the success rate  would be difficult  to                                                            
gauge,  the number  of youth  who  participate in  the after-school                                                             
program "is  tremendous."  He avowed that  a broad cross-section  of                                                            
public housing residents  are served by these grant programs and, he                                                            
attested, the Authority considers the program to be "of value"                                                                  
                                                                                                                                
Co-Chair  Green asserted  that the  Drug Elimination  grant  program                                                            
should be reflected in  the Department of Health and Social Services                                                            
budget as she  continued, cross-referencing this program  with other                                                            
departments that conduct similar programs would be beneficial.                                                                  
                                                                                                                                
Co-chair  Wilken agreed  that "the  tie" between  agencies would  be                                                            
noteworthy.                                                                                                                     
                                                                                                                                
Co-Chair  Green  commented  that  this  reference  would  assist  in                                                            
avoiding duplication of efforts by the various departments.                                                                     
                                                                                                                                
     Energy Efficiency Monitoring Research                                                                                      
     $ 1,000,000 Corporate Receipts                                                                                             
     Reference No.: 6351                                                                                                        
     Project Type: Health and Safety                                                                                            
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Energy  Efficiency  Monitoring  Research -  utilizes  Corporate                                                            
     (AHFC)  funds for a  designated grant  to Cold Climate  Housing                                                            
     Research  Center  to  conduct  housing construction   research,                                                            
     analysis,  and  information  dissemination  among  the  housing                                                            
     industry  and the public. Data gathering and  analysis is being                                                            
     continually  related to energy efficiency technology  for homes                                                            
      constructed in northern building and market conditions.                                                                   
                                                                                                                                
Mr. Campbell read the project description.                                                                                      
                                                                                                                                
Mr. Fauske reminded the  Committee that, years prior, the Fannie Mae                                                            
federal  loan  program and  AHFC  had combined  funding  efforts  to                                                            
support an  endeavor to provide  a centralized  location at  which a                                                            
variety of building  industries could work together  to conduct cold                                                            
weather design  research and product  testing involving such  things                                                            
as  energy  and  weather  resistant  products.  He  noted  that  the                                                            
University of Alaska Fairbanks  campus recently contributed land and                                                            
that federal funding has  been earmarked toward the design of such a                                                            
center. He informed  the Committee that the nation's  current arctic                                                            
testing  center is  located in  Florida,  and he  asserted that  the                                                            
University  of Alaska Fairbanks campus  provides a more appropriate                                                             
setting for this  type of testing. He stated that  the ultimate goal                                                            
of this program  is that it would become self-sufficient.  He stated                                                            
that this is a good program with "a lot of potential."                                                                          
                                                                                                                                
Co-Chair Wilken observed  that although this is a new program, it is                                                            
not referred  to as  such in the  backup material.  While he  voiced                                                            
support  for the  concept  of the  project,  he commented  that  the                                                            
Committee would  conduct more research on it in order  to get a more                                                            
thorough understanding  of it and to assure that general fund monies                                                            
would not be required to support the project in the future.                                                                     
                                                                                                                                
Senator  Taylor stated  that  he is encouraged  to  hear about  this                                                            
project as, he  asserted, the State has over-regulated  construction                                                            
by mandating  "that  certain levels  of efficiency"  be required  in                                                            
order  to qualify  for various  loan programs.  He  stated that  the                                                            
result of homeowners'  attempts to  build to these standards  in the                                                            
"high humidity  rainforest"  of Southeast  Alaska was unhealthy  and                                                            
dangerous  homes  because  of  poor  air  circulation.  However,  he                                                            
acknowledged  that  a home  built to  those same  specifications  in                                                            
another  region of  the State  that had  dry conditions  might  work                                                            
perfectly.  Therefore, he voiced that  this project is good  news in                                                            
that  it  would  conduct   research  appropriate  to   the  building                                                            
conditions of Alaska rather  than adopting programs that do not work                                                            
on a statewide  basis. He agreed, however, that the  ongoing funding                                                            
mechanism should be further researched.                                                                                         
                                                                                                                                
Mr. Fauske  informed that  AHFC is furthering  a program that  would                                                            
address  energy  efficiency  statutes  to  accommodate  the  State's                                                            
varying climates.                                                                                                               
                                                                                                                                
Co-Chair Wilken  noted that this program might eventually  allow for                                                            
the development  of prototypes for  schools in the various  regions.                                                            
                                                                                                                                
                                                                                                                                
SFC 03 # 26, Side B 09:54 AM                                                                                                    
                                                                                                                                
                                                                                                                                
     State Energy Program (SEP) Special Projects                                                                                
     $ 473,500                                                                                                                  
          $ 50,000 Corporate Receipts                                                                                           
          $423,500 Federal Receipts                                                                                             
     Reference No.: 32526                                                                                                       
     Project Type: Health and Safety                                                                                            
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Energy Program  (SEP) Special Projects - utilizes Federal                                                            
     (DOE) and Corporate  match funds for State Energy Program (SEP)                                                            
     special  projects  such as:  building technologies,  Codes  and                                                            
     Standards,  Wind and Power technologies,  renewable  energy for                                                            
     remote areas or transportation technologies.                                                                               
                                                                                                                                
Mr.  Campbell  read the  state  energy program  (SEP)  projects.  He                                                            
stated  that the federal  funding  amount that is  available  to the                                                            
State is an increase over the previous yea's funding.                                                                           
                                                                                                                                
Co-Chair  Wilken asked whether  the federal  funding level  would be                                                            
negatively affected were the level of State funding reduced.                                                                    
                                                                                                                                
Mr.  Campbell  informed  that in  order  to receive  this  level  of                                                            
federal funding, the total  match requirement would be approximately                                                            
$75,000.  He stated that while  it is not  specified in the  back up                                                            
material,   AHFC  would  be  requiring   these  pass-through   grant                                                            
recipients to  assist with the funding of the total  required match.                                                            
                                                                                                                                
Mr. Fauske  commented that  the majority of  these funds would  flow                                                            
from AHFC to the Alaska  Industrial Development and Export Authority                                                            
(AIDEA) as specified on page 3-22 of the Report.                                                                                
                                                                                                                                
     Homeless Assistance Program Mental Health Bill                                                                             
     $ 750,000                                                                                                                  
          $250,000 Corporate Receipts                                                                                           
          $500,000 Mental Health Trust Fund Receipts                                                                            
     Reference No.: 6359                                                                                                        
     Project Type: Transitional                                                                                                 
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Homeless  Assistance Program - utilizes Corporate  (AHFC) funds                                                            
     for  grants  to  local  communities/agencies  to  help  develop                                                            
     programs  that prevent homelessness by providing  assistance to                                                            
     families in imminent  danger of becoming homeless, or those who                                                            
     are  currently homeless.  Corporate  funds will  be matched  by                                                            
     Mental  Health  Trust  Authority  funds.  Both  funds  will  be                                                            
     combined and administered as one program by AHFC.                                                                          
                                                                                                                                
Mr. Campbell  read the project description  and noted that  the list                                                            
of applicants  and their requested  level of funding as well  as the                                                            
level of funding  that AHFC could  provide is detailed on  page 3-24                                                            
of the Report.                                                                                                                  
                                                                                                                                
     Beneficiary and Special Needs Housing Mental Health Bill                                                                   
     $ 1,200,000 Corporate Receipts                                                                                             
     Reference No.: 6360                                                                                                        
     Project Type: Health and Safety                                                                                            
     Category: Housing/Social Services                                                                                          
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Beneficiary and Special  Needs Housing - Corporate (AHFC) funds                                                            
     for  a continuing  program to  serve populations  with  special                                                            
     housing needs. The  program provides funds to Alaskan nonprofit                                                            
     service providers  to increase housing opportunities for Mental                                                            
     Health Trust beneficiaries  and other special needs populations                                                            
     throughout  the  state.  The  funds  may be  used  for  housing                                                            
     development and/or residential accessibility modifications.                                                                
                                                                                                                                
Mr. Campbell read the project description.                                                                                      
                                                                                                                                
Co-Chair  Green asked whether  this request  would require  a Mental                                                            
Health Trust Fund match.                                                                                                        
                                                                                                                                
Mr.  Campbell  replied  no,  as a  separate  special  housing  needs                                                            
program  that is operated  by the  Department of  Health and  Social                                                            
Services has that requirement.                                                                                                  
                                                                                                                                
Senator Taylor  asked how the ranking of the applicants  who receive                                                            
funding  from the Homeless  Assistance Program,  Reference  6359, is                                                            
determined.                                                                                                                     
                                                                                                                                
Mr. Campbell responded  that applications are awarded funds based on                                                            
a  point ranking  system.  He  continued  that  the more  points  an                                                            
application receives, the higher it is ranked.                                                                                  
                                                                                                                                
Mr. Fauske  informed that,  were it determined  that an applicant's                                                             
project to require  some revision; AHFC would assist  them with that                                                            
process. The project,  he noted, could be resubmitted  the following                                                            
year.                                                                                                                           
                                                                                                                                
Senator  Taylor voiced disappointment  that  a project proposed  for                                                            
Sitka did not  receive funding, and  he asked that AHFC provide  him                                                            
specific information  regarding that project so he  could understand                                                            
the process further.                                                                                                            
                                                                                                                                
Mr.  Campbell  responded that,  were  a higher  level  of  available                                                            
funding available,  more projects could receive funding.  He assured                                                            
that the ranking criteria information would be provided.                                                                        
                                                                                                                                
Senator Bunde  referred the Committee  to the Six-Year Plan  located                                                            
on page 3-29 of  the Report, and he asked for confirmation  that the                                                            
total  of federal  and  corporate  funding  being requested  is  $75                                                            
million.                                                                                                                        
                                                                                                                                
Mr. Campbell confirmed.                                                                                                         
                                                                                                                                
Senator Bunde  pointed out that while the State is  often criticized                                                            
for the  amount of  money that  is spent  per capita,  it should  be                                                            
noted  that  a large  percent  of  these  expenditures  include  the                                                            
federal  government contribution  to  the State via  AHFC. He  noted                                                            
that  the  federal  contribution  to  Alaska  is  higher  than  that                                                            
received by any other state.                                                                                                    
                                                                                                                                
Mr. Campbell  noted that the total  federal funding contribution  to                                                            
AHFC being proposed for FY 04 would amount to $9.6 million.                                                                     
                                                                                                                                
Senator Bunde  asked whether  a reduction in  the amount of  federal                                                            
funding  that  requires a  State  match would  "free  up  additional                                                            
monies" that AHFC could  then contribute to the State as a dividend.                                                            
                                                                                                                                
Mr. Campbell responded  that were the funds not being  required as a                                                            
match for programs, yes.                                                                                                        
                                                                                                                                
Mr. Fauske  stressed that  while this budget  is for $75.6  million,                                                            
separate  legislation is  being furthered  that might increase  this                                                            
budget  to  $103 million.  He  stated  that additional  information                                                             
regarding this $28 million increase would be forthcoming.                                                                       
                                                                                                                                
Co-Chair  Wilken  furthered  that separate  legislation  that  would                                                            
alter the nature of the  AHFC dividend program would be forthcoming.                                                            
He continued  that the  legislation would  change the AHFC  dividend                                                            
program by proposing  a predictable long-term dividend  payout plan.                                                            
                                                                                                                                
AT EASE: 10:05 AM / 10:05 AM                                                                                                    
                                                                                                                                
The bill was ordered HELD in Committee.                                                                                         

Document Name Date/Time Subjects