Legislature(2009 - 2010)SENATE FINANCE 532

03/16/2010 09:00 AM FINANCE


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09:07:51 AM Start
09:08:12 AM SB230 || SB253
10:52:31 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
*+ SB 230 BUDGET: CAPITAL, SUPP. & OTHER APPROPS TELECONFERENCED
Heard & Held
+= SB 253 APPROP: DEFERRED MAINTENANCE/REPLACEMENT TELECONFERENCED
Heard & Held
University
Dept of Transportation & Public
Facilities
Dept of Natural Resources
Dept of Environmental Conservation
Dept of Fish & Game
Dept of Commerce, Community & Economic
Development
Dept of Administration
+ Bills Previously Heard/Scheduled TELECONFERENCED
SENATE BILL NO. 230                                                                                                           
                                                                                                                                
     "An Act making and amending appropriations, including                                                                      
     capital appropriations, supplemental appropriations,                                                                       
     and other appropriations; making appropriations to                                                                         
     capitalize funds; and providing for an effective                                                                           
     date."                                                                                                                     
                                                                                                                                
SENATE BILL NO. 253                                                                                                           
                                                                                                                                
     "An Act making capital appropriations for deferred                                                                         
     maintenance projects, equipment replacement, and                                                                           
     emergency repairs; and providing for an effective                                                                          
     date."                                                                                                                     
                                                                                                                                
9:08:12 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman  made opening  comments. He  referenced the                                                                    
budget books entitled,  "Governor's Proposed Capital Budget"                                                                    
and "Project  Review Listing - FY  2010 Deferred Maintenance                                                                    
Amended" (copy on file).                                                                                                        
                                                                                                                                
UNIVERSITY OF ALASKA                                                                                                            
                                                                                                                                
9:12:22 AM                                                                                                                    
                                                                                                                                
MARK HAMILTON,  PRESIDENT, UNIVERSITY OF  ALASKA, introduced                                                                    
himself.                                                                                                                        
                                                                                                                                
KIT DUKE,  CHIEF FACILITIES  OFFICER, UNIVERSITY  OF ALASKA,                                                                    
introduced herself.                                                                                                             
                                                                                                                                
MICHELLE RIZK,  ASSOCIATE VICE PRESIDENT,  STATEWIDE BUDGET,                                                                    
UNIVERSITY OF ALASKA, introduced herself.                                                                                       
                                                                                                                                
9:14:07 AM                                                                                                                    
                                                                                                                                
DM AMD 45326                                                                                                                    
     Maintaining Existing Facilities Renewal and Renovation                                                                     
     Annual Requirement                                                                                                         
     $37,500,000 GF                                                                                                             
                                                                                                                                
Ms.  Rizk  informed  the   committee  that  maintaining  the                                                                    
state's  investment  in facilities  has  been  the Board  of                                                                    
Regent's  top priority  for many  years.  The University  of                                                                    
Alaska uses  $6.7 million square feet,  nearly 400 buildings                                                                    
of  various  sizes  and  purposes,  located  throughout  the                                                                    
state.  The  average age  of  the  facilities is  thirty-one                                                                    
years. The deferred maintenance  bill includes $37.5 million                                                                    
toward  the  annual  requirement  for  maintaining  existing                                                                    
facilities  and   reducing  deferred  maintenance   for  the                                                                    
university. The  funding will be  distributed to  each major                                                                    
academic unit (MAU)  based on a formula of  facility age and                                                                    
size, times the weighted average age.                                                                                           
                                                                                                                                
Ms.  Rizk  offered  to  provide  information  regarding  the                                                                    
number, size, and age of facilities per campus.                                                                                 
                                                                                                                                
Ms.  Duke  discussed the  list  of  projects that  would  be                                                                    
funding  by  the $37.5  million.  She  pointed out  that  73                                                                    
percent of the  university's square footage is  more than 25                                                                    
years  old.  The $37.5  million  will  cover replacement  of                                                                    
heating  and   ventilating  systems,  fire   alarm  systems,                                                                    
flooring and  wall finishes, and  roofing projects.  Many of                                                                    
the projects  are bid ready now.  All of them can  go out to                                                                    
bid in  2010. Much of  the funding  should be spent  in 2010                                                                    
and  through  the  winter  of 2011.  Also  included  in  the                                                                    
requests  is   money  designated  for   energy  conservation                                                                    
projects, which  will create some  savings in  the operating                                                                    
budget.  The projects  will address  needs  at all  campuses                                                                    
statewide.                                                                                                                      
                                                                                                                                
Co-Chair Hoffman  requested a breakdown by  campus. Ms. Duke                                                                    
agreed to do so.                                                                                                                
                                                                                                                                
Co-Chair  Stedman asked  for  information  on each  deferred                                                                    
maintenance request.                                                                                                            
                                                                                                                                
9:16:21 AM                                                                                                                    
                                                                                                                                
Ms. Duke  began with the Anchorage  science building renewal                                                                    
request.  The  building  needs  to  be  refurbished  due  to                                                                    
occupancy  this past  summer. There  is also  a request  for                                                                    
campus   roof   replacement   and  upgrades   for   heating,                                                                    
ventilating,  and air  conditioning  systems,  and for  fire                                                                    
alarm panels. There is a  need for a water system connection                                                                    
at  the Kenai  River Campus  and for  a wellness  center and                                                                    
student  life  renewal  project for  Prince  William  Sound.                                                                    
There is  a boiler  and exhaust  fan replacement  project at                                                                    
the  MatSu  Campus,  and  a  Kodiak  Campus  renewal,  which                                                                    
entails repair of mechanical and electrical systems.                                                                            
                                                                                                                                
Ms.  Duke  described   deferred  maintenance  requests  from                                                                    
Fairbanks:   Skarland  Hall   dormitory  critical   restroom                                                                    
renovation,   critical  electrical   distribution,  critical                                                                    
power  plant repairs,  and critical  repairs  for the  waste                                                                    
system.  Also  needed  is Phase  4  revitalization  for  the                                                                    
Tenana Valley Community Campus.                                                                                                 
                                                                                                                                
Ms. Duke  highlighted projects at  the Kuskokwim  Campus and                                                                    
energy conservation repairs for  Kotzebue, Bethel, and Nome.                                                                    
At the  Juneau Campus  there is a  need for  improvements in                                                                    
the road  entryway, as  well as  repairs to  the Hendrickson                                                                    
Building, to the parking lot,  to a roof, and replacement of                                                                    
fire alarms and the sewage lift station.                                                                                        
                                                                                                                                
In  Sitka,  code corrections  are  being  made to  the  main                                                                    
building. A roof in Ketchikan  is being replaced, as well as                                                                    
an oil tank.                                                                                                                    
                                                                                                                                
Ms.  Duke  listed  statewide  building  projects  -  roofing                                                                    
replacements  and  refurbishing  the   canopy  to  the  main                                                                    
Butrovich Building at  UAF. At UAA, the  Lake Building would                                                                    
get a fire alarm system and lighting upgrades.                                                                                  
                                                                                                                                
9:19:32 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  requested  an  update on  the  status  of                                                                    
previously   appropriated   maintenance   monies   for   the                                                                    
university.   Ms.  Duke   indicated  that   last  year   the                                                                    
university received  $3.2 million  in repair  and renovation                                                                    
(R&R) funding. The previous year  it received $47.5 million.                                                                    
She offered to provide the balances for the past two years.                                                                     
                                                                                                                                
Co-Chair  Stedman recalled  the $47  million allocation.  He                                                                    
wondered what the  rate of encumbrance was and  if the money                                                                    
had  all been  spent.  He  pointed out  that  last year  the                                                                    
legislature  did  not  add projects.  Ms.  Rizk  offered  to                                                                    
provide that information.  She spoke of the  challenges of R                                                                    
& R funding.  The university has received an  average of $16                                                                    
million of  the $50  million annual requirement  needed over                                                                    
the last ten years. The funding has been sporadic.                                                                              
                                                                                                                                
9:21:51 AM                                                                                                                    
                                                                                                                                
Ms. Duke  added that a  number of projects  include advanced                                                                    
design work that the department  expects to be funded in the                                                                    
next  round of  the governor's  program. It  is possible  to                                                                    
have a consistent program and  prepare for the next round of                                                                    
money so that  spending takes place soon after  the money is                                                                    
appropriated.                                                                                                                   
                                                                                                                                
Senator Ellis  asked about the UAA  Science Building renewal                                                                    
for $6.8  million. He pointed  out that the Blue  Book lists                                                                    
it  at $11  million.  He wondered  about  the difference  in                                                                    
amounts.  Ms. Duke  explained that  under the  $37.5 million                                                                    
allocation,  the   apportioned  share   that  would   go  to                                                                    
Anchorage  is  $6.8  million.  If  additional  funding  were                                                                    
available, more of the total project could be funded.                                                                           
                                                                                                                                
Senator Ellis  concluded that the  project really  costs $11                                                                    
million.  Ms. Duke  agreed. Senator  Ellis continued  to say                                                                    
that because  of some sort of  regional proportionality, the                                                                    
project is only allocated  $6.8 million. Other funding would                                                                    
have to be  found from other sources in order  to fully fund                                                                    
the  project.  Senator  Ellis requested  clarification.  Ms.                                                                    
Duke explained that  there is work that can be  done for the                                                                    
$6.8 million;  however, it  would be  more efficient  if the                                                                    
department were able to fund  the whole project at one time.                                                                    
She  pointed out  that this  item  does not  come under  the                                                                    
regional funding formula, but rather  it is based on age and                                                                    
square footage.                                                                                                                 
                                                                                                                                
9:23:48 AM                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  noted that out  of the $37.5  million, the                                                                    
Kuskokwim  Campus received  $100,000. He  wondered how  much                                                                    
funding was  allocated for  phases three  and four  and what                                                                    
that money would accomplish. Ms. Duke offered to find out.                                                                      
                                                                                                                                
Co-Chair Stedman asked about the  funding request for $108.6                                                                    
million,  $88 million  in general  funds  and roughly  $20.6                                                                    
million  in   non-general  funds,  for  the   Life  Sciences                                                                    
Building. He wondered how much  the university would need to                                                                    
move  forward under  a phased  approach. Ms.  Rizk spoke  of                                                                    
alternative options if the funding  requested in FY 2011 was                                                                    
not all available at once.                                                                                                      
                                                                                                                                
9:25:36 AM                                                                                                                    
                                                                                                                                
BRIAN ROGERS,  CHANCELLOR, UNIVERSITY OF  ALASKA, FAIRBANKS,                                                                    
explained the options  as to how the  Life Sciences facility                                                                    
might be phased. The project  includes $15 million to extend                                                                    
a utilidor to  the west ridge to provide heat  and power. It                                                                    
includes  $7  million for  relocation  of  a greenhouse  and                                                                    
construction   of   a   replacement   greenhouse   for   the                                                                    
agricultural  program.  Those   two  pieces  are  severable.                                                                    
Within the  Life Sciences building,  just the  research wing                                                                    
or the  instructional wing could be  constructed. He offered                                                                    
to provide the financial picture for each scenario.                                                                             
                                                                                                                                
Co-Chair  Stedman   asked  for  clarification  of   the  $15                                                                    
million. Chancellor Rogers explained  that $15 million would                                                                    
only  build the  utilidor; $7  million would  fund only  the                                                                    
greenhouse.  It  would  cost  $41.9  million  to  build  the                                                                    
instructional wing, and $52.2  million plus the university's                                                                    
non-general  fund  authority  for  the  research  wing.  The                                                                    
latter two numbers include the  utilidor and greenhouse. Co-                                                                    
Chair Stedman  said he  was struggling  with the  process of                                                                    
funding everything in the Life Sciences Building.                                                                               
                                                                                                                                
9:27:44 AM                                                                                                                    
                                                                                                                                
Ms.  Rizk asked if there were further questions.                                                                                
                                                                                                                                
Senator Olson asked about funding  for the Kotzebue and Nome                                                                    
Campuses.  Ms. Duke  said the  category is  Community Campus                                                                    
(CC) Energy  Conservation for $768,700. Ms.  Rizk added that                                                                    
it is listed  as UAF CC. Senator Olson asked  if the goal is                                                                    
to  make it  more energy  efficient.  Ms. Duke  said it  was                                                                    
intended to curb rising utility costs in rural areas.                                                                           
                                                                                                                                
Senator  Thomas  asked  for  the  total  dollar  amount  for                                                                    
backlogged maintenance projects. Ms.  Duke reported that the                                                                    
dollar amount  was about  $1 billion. She  did not  know the                                                                    
number of  projects. Senator  Thomas asked  if the  list was                                                                    
prioritized and if  the intention was to  spread the funding                                                                    
down the  list as much as  possible. Ms. Duke said  that was                                                                    
true. Senator  Thomas observed that with  only $37.5 million                                                                    
allocated for deferred maintenance, it  will take a while to                                                                    
fund $1 billion-worth of projects. Ms. Duke agreed.                                                                             
                                                                                                                                
Co-Chair  Hoffman   asked  how  the  project   rankings  are                                                                    
determined, and  how the cutoffs  and distributions  at each                                                                    
campus are decided. He pointed  out that his initial request                                                                    
was for  $3.1 million for UAA,  $1.8 million for UA  CC, $23                                                                    
million for UAF, and $.8 million for UAF CC.                                                                                    
                                                                                                                                
9:31:31 AM                                                                                                                    
                                                                                                                                
Ms. Duke  explained the formula  used to decide  on funding.                                                                    
The  square  footage  and  the age  of  the  square  footage                                                                    
determine  a  formula  for each  campus.  The  projects  are                                                                    
prioritized by the  MAU as far down the list  as the funding                                                                    
allows. The  most urgent projects  at each campus  are given                                                                    
priority.  She noted  it  was a  typical  way of  addressing                                                                    
deferred maintenance funding.                                                                                                   
                                                                                                                                
Co-Chair Hoffman deduced that  there was a scientific method                                                                    
used to calculate the  numbers. President Hamilton clarified                                                                    
that  the  methodology  for determining  the  funding  is  a                                                                    
nationally-used   formula.  He   continued  to   detail  how                                                                    
deferred maintenance  items are  funded. He  emphasized that                                                                    
the  request  was  for  the amount  needed  every  year  for                                                                    
maintenance  in  order  to prevent  the  need  for  deferred                                                                    
maintenance. The standard number  to achieve that goal would                                                                    
be  about  $50  million  per   year.  He  related  that  the                                                                    
allocation is set up to project funding out five years.                                                                         
                                                                                                                                
9:34:58 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman  pointed  out   that  the  university  has                                                                    
substantially  less square  footage than  the state.  If the                                                                    
state tried  to keep  up on  maintenance projects  using the                                                                    
same  formula, the  number would  be  very large.  President                                                                    
Hamilton noted that  many of the state  buildings are leased                                                                    
and  the maintenance  falls to  the owner,  rather than  the                                                                    
state.                                                                                                                          
                                                                                                                                
CAP RN 43172                                                                                                                    
     UAF Life Sciences Classroom and Lab Facility                                                                               
     $20,625,000 Univ Rcpt                                                                                                      
     $87,975,000 COP's                                                                                                          
                                                                                                                                
Ms. Rizk highlighted the UAF  Life Sciences Building request                                                                    
and  emphasized the  importance of  the request.  She listed                                                                    
the reasons why the request  is needed now. The new facility                                                                    
will replace cramped quarters  and antiquated teaching space                                                                    
and   integrate  teaching   and   research  in   biological,                                                                    
wildlife, and  biomedical services.  The university  will be                                                                    
able  to attract  top  students,  faculty, researchers,  and                                                                    
research grants.                                                                                                                
                                                                                                                                
Ms. Rizk  referred to Senator  Hoffman's question  about why                                                                    
it is  important to  build the  Life Sciences  Building now.                                                                    
She  reported  that great  financing  is  available now  and                                                                    
construction  costs are  lower. The  university is  ready to                                                                    
take  advantage of  federal  priorities  and make  available                                                                    
research needed at the national level.                                                                                          
                                                                                                                                
Ms. Rizk  reported on a  critical need for space.  She spoke                                                                    
of the significant economic impacts  from this project, such                                                                    
as  $170  million  in direct  and  indirect  economy  output                                                                    
during construction  and 370 construction  workers employed,                                                                    
with an annual payroll of $80 million.                                                                                          
                                                                                                                                
She referred to  a McDowell Group report  which explains the                                                                    
economic  impacts  of  the  Life   Sciences  project  and  a                                                                    
brochure  which  details  some   of  the  specifics  of  the                                                                    
facility.                                                                                                                       
                                                                                                                                
9:39:07 AM                                                                                                                    
                                                                                                                                
Co-Chair  Stedman asked  what  the  next university  project                                                                    
would be. Ms. Rizk referred  to the 10-year capital plan and                                                                    
said there would be another request next year.                                                                                  
                                                                                                                                
Co-Chair Hoffman  referred to  the university  receipts list                                                                    
and asked  how the  amount of $20.6  million relates  to the                                                                    
total  project  cost.  Ms.  Rizk  explained  that  the  bond                                                                    
payment would  be made through the  additional indirect cost                                                                    
recovery (ICR)  that UAF believes  it can generate  from the                                                                    
facility. Considering the  approximately $1.6 million annual                                                                    
debt  payment, the  amount  was what  UAF  figured it  could                                                                    
afford by including the ICR.                                                                                                    
                                                                                                                                
Senator  Thomas  asked  if  federal  receipts  totaled  $130                                                                    
million for research  grant money in 2007. He  asked if that                                                                    
figure  was  used  when trying  to  determine  the  economic                                                                    
impact of the Life Sciences Building.                                                                                           
                                                                                                                                
Co-Chair  Hoffman asked  for  information about  anticipated                                                                    
operating costs  and staffing needs. Ms.  Rizk reported that                                                                    
operating costs  are expected to  be $2.6 million,  of which                                                                    
about $1  million would be  for maintenance  and operations,                                                                    
and $1.6 million would be  for maintenance and repair. There                                                                    
would be  new positions including maintenance  staff and 1.5                                                                    
teaching assistance  positions to cover lab  sessions. Those                                                                    
positions would be covered by non-general funds.                                                                                
                                                                                                                                
Ms.  Rizk explained  that  the  faculty positions  currently                                                                    
exist. She spoke of Life  Sciences priorities in the FY 2011                                                                    
budget, and  detailed the positions expected.  She said they                                                                    
were included in the operating budget request.                                                                                  
                                                                                                                                
Co-Chair Hoffman  asked how much  of the $2.6 million  is in                                                                    
the current  operating budget. Ms.  Rizk explained  that the                                                                    
$2.6 million  request is an additional,  future-year request                                                                    
and would be included in four years.                                                                                            
                                                                                                                                
9:44:01 AM                                                                                                                    
                                                                                                                                
Co-Chair  Hoffman  asked what  the  plans  for the  existing                                                                    
facility  were. Ms.  Rizk replied  that programs  were still                                                                    
being evaluated  to see which  would be best suited  for the                                                                    
vacated spaces. Renovation  costs are included in the  R & R                                                                    
list.  Ms.  Duke  added  that  the  space  may  be  used  by                                                                    
researchers and funded by research grants.                                                                                      
                                                                                                                                
Senator   Thomas  asked   for   information  about   general                                                                    
obligation (GO)  bonds versus certificates  of participation                                                                    
(COP's). He  thought the  COP's would  provide a  lower rate                                                                    
when the Build America Bonds are factored in.                                                                                   
                                                                                                                                
9:46:06 AM                                                                                                                    
                                                                                                                                
Ms.  Rizk addressed  Senator  Hoffman's  question about  who                                                                    
would inhabit the  old building. She added  that the faculty                                                                    
currently housed in ATCO modular  buildings, as well as some                                                                    
new faculty, might move into the vacated space.                                                                                 
                                                                                                                                
Senator Ellis  stated that  he was a  supporter of  the Life                                                                    
Sciences project  and the  engineering program  expansion at                                                                    
UAF and UAA.  He asked how the  engineering buildings ranked                                                                    
in the  regent's priority list.  He wondered how  the demand                                                                    
for  more engineers  would  be  met. He  spoke  in favor  of                                                                    
expanding  the   engineering  program.  He   requested  more                                                                    
information about meeting the demands in that area.                                                                             
                                                                                                                                
President  Hamilton  predicted   that  engineering  facility                                                                    
expansion  would be  the regents'  number one  priority next                                                                    
year.  Senator Ellis  agreed with  that direction.  Ms. Rizk                                                                    
added   that  the   Board  of   Regents  had   decided  that                                                                    
engineering was the next priority.                                                                                              
                                                                                                                                
9:48:41 AM                                                                                                                    
                                                                                                                                
CAP RN 49199                                                                                                                    
     Feasibility Study for Community Campuses                                                                                   
     $1,400,000 GF                                                                                                              
                                                                                                                                
Co-Chair  Stedman  asked  about  the  feasibility  study  on                                                                    
community campuses.  Ms. Duke explained  that the  money was                                                                    
intended  to  take a  holistic  look  at  the needs  of  the                                                                    
community  campuses and  facilitate a  professional approach                                                                    
to development of those campuses.                                                                                               
                                                                                                                                
Co-Chair  Stedman  asked  if the  requests  were  ranked  by                                                                    
priority. Ms.  Duke said  the MAU's  rank the  projects. Ms.                                                                    
Rizk  added  that  the University  of  Alaska's  number  one                                                                    
priority   is  deferred   maintenance.  The   Life  Sciences                                                                    
facility is  the number one  priority for  new construction.                                                                    
The  community   campus  feasibility   study  is   the  next                                                                    
priority.                                                                                                                       
                                                                                                                                
Co-Chair  Stedman summarized  that  deferred maintenance  is                                                                    
first;  the  Life  Science  building  is  second.  Ms.  Rizk                                                                    
concurred. She  said that  the Board  of Regents  prefers to                                                                    
take  care  of existing  facilities  first  - a  number  one                                                                    
priority for over a decade.                                                                                                     
                                                                                                                                
DEPARTMENT OF TRANSPORTATION                                                                                                    
                                                                                                                                
9:51:01 AM                                                                                                                    
                                                                                                                                
DM RN 49567                                                                                                                     
     Deferred Maintenance Projects                                                                                              
     $25,000,000 GF                                                                                                             
                                                                                                                                
FRANK  RICHARDS,  DEPUTY  COMMISSIONER,  HIGHWAYS  &  PUBLIC                                                                    
FACILITIES,   DEPARTMENT   OF  TRANSPORTATION   AND   PUBLIC                                                                    
FACILITIES,  reported that  the  department  received a  $25                                                                    
million allocation in the  deferred maintenance request from                                                                    
the governor. Within that  allocation, 193 specific projects                                                                    
have   been  identified.   There  are   sub-allocations  for                                                                    
aviation,  facilities, harbors,  marine highway  and highway                                                                    
functions.  He  explained  that the  allocations  were  made                                                                    
based on deferred maintenance needs  across the spectrum. He                                                                    
reported that  the department calculated about  $750 million                                                                    
worth   of  deferred   maintenance  needs   and  made   sub-                                                                    
allocations based  on those needs. Within  each mode, safety                                                                    
requirements,   security,   preservation,   and   regulatory                                                                    
categories were  considered. Specific  work types  were also                                                                    
examined.                                                                                                                       
                                                                                                                                
Mr.  Richards listed  the primary  needs  in aviation:  life                                                                    
safety,  gravel surface  repairs, fencing  and gates,  drain                                                                    
improvements,  asphalt   repairs,  electrical   repairs  and                                                                    
parts,  and vegetation  management.  He  detailed the  needs                                                                    
under the  marine highway category:  safety and life  at sea                                                                    
requirements,  fire  detection   and  prevention,  emergency                                                                    
response,  and international  codes.  Under facilities,  the                                                                    
priorities  are:  electrical  upgrades,  elevator  upgrades,                                                                    
roofing, heating, power  generation, and hoist replacements.                                                                    
For highways, the  bulk of the requests  are for: vegetation                                                                    
management,  gravel  surfacing,  asphalt  repair,  guardrail                                                                    
repair,  traffic  signals  and  signs,  drainage,  culverts,                                                                    
bridges, and high light tower repairs.                                                                                          
                                                                                                                                
Mr. Richards reported that the  governor was very interested                                                                    
in job  creation, so the  department has decided  to provide                                                                    
contracts  in  order to  accomplish  the  work in  a  timely                                                                    
manner.   As   soon   as   the   department   receives   the                                                                    
appropriation, it can initiate  the contracts and begin work                                                                    
this summer. The  department anticipates using approximately                                                                    
80 percent of the $25  million allocation for contracts, and                                                                    
the remaining 20 percent allocated  to state forces. Of that                                                                    
20 percent, the majority will  be used to purchase materials                                                                    
and to rent equipment.                                                                                                          
                                                                                                                                
9:54:17 AM                                                                                                                    
                                                                                                                                
Mr. Richards  spoke of the  goal "to get these  projects out                                                                    
on the  street to  address those deferred  maintenance items                                                                    
across  the modes  in the  very  near term."  He offered  to                                                                    
discuss individual requests.                                                                                                    
                                                                                                                                
Co-Chair  Stedman  suggested looking  at  each  page of  the                                                                    
spreadsheet.                                                                                                                    
                                                                                                                                
Co-Chair Hoffman  asked about the  location of  Quartz Creek                                                                    
Airport -  item 10. Mr.  Richards said  it was on  the Kenai                                                                    
Peninsula along the Sterling Highway.                                                                                           
Senator  Olson inquired  about  item 9  -  Koyuk &  Stebbins                                                                    
Brush Cutting.  Mr. Richards  could not  provide information                                                                    
about the  two airports.  Senator Olson said  the department                                                                    
could report back with the information.                                                                                         
                                                                                                                                
9:56:19 AM                                                                                                                    
                                                                                                                                
Co-Chair Stedman asked  if there were any  questions on page                                                                    
2.  Senator  Olson referred  to  a  recent accident  at  the                                                                    
Kodiak Airport.  He wondered which airport  the accident was                                                                    
at. Mr.  Richards said  it was at  the main  Kodiak airport.                                                                    
Senator Olson asked if anything  on the deferred maintenance                                                                    
list contributed to the accident.  Mr. Richards did not know                                                                    
of any  airport features  that contributed to  the accident.                                                                    
Senator Olson  wanted to rule out  incomplete maintenance as                                                                    
an issue.                                                                                                                       
                                                                                                                                
Co-Chair Stedman asked if there  were any questions on pages                                                                    
3 or 4.                                                                                                                         
                                                                                                                                
9:57:36 AM                                                                                                                    
                                                                                                                                
Senator  Huggins  asked  an  aviation-related  question.  He                                                                    
brought  up  the   topic  of  the  Iditarod   Race  and  the                                                                    
challenges  it brings  to the  Willow community  and to  the                                                                    
airport  complex. He  asked why  the Willow  airport is  not                                                                    
included on the list. Mr.  Richards explained that the needs                                                                    
at  Willow are  capital expenses,  not deferred  maintenance                                                                    
needs.  Senator   Huggins  reiterated  the   challenge  that                                                                    
exists.                                                                                                                         
                                                                                                                                
9:59:18 AM                                                                                                                    
                                                                                                                                
Senator Thomas  asked if local  hire is a primary  focus for                                                                    
small maintenance  projects such  as brushing.  Mr. Richards                                                                    
replied  that  in  most  rural airports  there  is  a  local                                                                    
contractor who deals with snow  removal and who is also used                                                                    
for other types of small maintenance projects.                                                                                  
                                                                                                                                
10:00:32 AM                                                                                                                   
                                                                                                                                
Co-Chair  Stedman asked  for information  about upgrades  to                                                                    
the Taku,  which are listed  on several pages.  Mr. Richards                                                                    
deferred to Mr. Beedle.                                                                                                         
                                                                                                                                
JIM BEEDLE, DEPUTY  COMMISSIONER, MARINE HIGHWAY, DEPARTMENT                                                                    
OF TRANSPORTATION  AND PUBLIC FACILITIES explained  that the                                                                    
Taku request is  one of three Safety of Life  at Sea (SOLAS)                                                                    
vessels,   which  means   it   is  certified   to  go   into                                                                    
international waters. If  the upgrades are not  done, it can                                                                    
no longer go into Prince Rupert on a year-round basis.                                                                          
                                                                                                                                
10:01:47 AM                                                                                                                   
                                                                                                                                
Senator Olson asked for more  information about the aviation                                                                    
building in item  1 on page 10. Co-Chair  Stedman thought it                                                                    
was in  Anchorage. Mr.  Richards said  that was  correct. He                                                                    
said   it   is  on   Aviation   Drive,   the  DOT   regional                                                                    
headquarters.  Senator Olson  asked  what  the elevator  was                                                                    
needed for. Mr. Richards explained  that the request was for                                                                    
repairs on an existing elevator.                                                                                                
                                                                                                                                
Mr. Richards  referred to  the highway  deferred maintenance                                                                    
sub-allocation  on  page  11. He  explained  that  the  work                                                                    
products are  broken down into various  work activities. For                                                                    
example,  the   topics  begin  with   vegetation  management                                                                    
followed by  gravel surfacing,  asphalt surface  repair, and                                                                    
guardrail repair.  There were no further  questions on pages                                                                    
12 - 16.                                                                                                                        
                                                                                                                                
10:03:20 AM                                                                                                                   
                                                                                                                                
Co-Chair Stedman  asked when  the deferred  maintenance work                                                                    
will be  done. Mr. Richards  hoped to complete as  much work                                                                    
as possible this coming summer  or by next summer. For rural                                                                    
projects dependant on  a barge schedule, it  is important to                                                                    
know  the amount  of  the appropriation  in  order to  order                                                                    
materials.                                                                                                                      
                                                                                                                                
Senator Olson  returned to number  10 on page 1,  the Quartz                                                                    
Creed  Airport,  and  asked  what  communities  the  airport                                                                    
serves. Mr.  Richards reported that  it was in  District 34,                                                                    
the  Kenai  Peninsula.  Co-Chair Stedman  requested  further                                                                    
information on the location.                                                                                                    
                                                                                                                                
10:05:42 AM                                                                                                                   
                                                                                                                                
CAP RN 47583                                                                                                                    
     Alaska Aviation Safety Program                                                                                             
     $500,000 Fed Rcpts                                                                                                         
     $250,000 Gen Fund                                                                                                          
                                                                                                                                
LAURA BAKER, DIRECTOR,  DIVISION OF ADMINISTRATIVE SERVICES,                                                                    
DEPARTMENT   OF   TRANSPORTATION  AND   PUBLIC   FACILITIES,                                                                    
explained  the  request  for   the  Alaska  Aviation  Safety                                                                    
Program.  The funding  is  used to  do  research for  safety                                                                    
needs for  private pilots and  small commuters.  The request                                                                    
will  fund a  staff  person  and the  general  fund will  be                                                                    
matched  by  a  federal  grant.  The  program  has  recently                                                                    
purchased a simulator to allow pilots to test out terrain.                                                                      
                                                                                                                                
10:08:22 AM                                                                                                                   
                                                                                                                                
Senator Egan asked if the  original request was for $500,000                                                                    
and  the total  $1  million. Ms.  Baker  explained that  the                                                                    
historical funding is  shown on the request  page. Last year                                                                    
the program received $400,000 in  federal funds and $400,000                                                                    
in general  funds. The  department did  go through  a review                                                                    
process. At  this time the  department does not have  a full                                                                    
financing plan  for anticipated federal receipts.  The match                                                                    
reflects the  minimum allowable to keep  the program running                                                                    
until more information is available.                                                                                            
                                                                                                                                
Co-Chair Hoffman  asked where the simulator  is located. Ms.                                                                    
Baker thought  one was in  Anchorage and  one was set  to be                                                                    
purchased. Co-Chair  Hoffman mentioned a program  in Western                                                                    
Alaska that  graduates pilots. He wondered  if the simulator                                                                    
was  being used  for  similar training.  Ms.  Baker was  not                                                                    
aware that is  was a training program, but  rather an option                                                                    
for current  pilots to use.  Co-Chair Hoffman  suggested the                                                                    
simulators might be better used  for training, especially in                                                                    
rural areas.                                                                                                                    
                                                                                                                                
10:11:28 AM                                                                                                                   
                                                                                                                                
Senator  Huggins asked  who  has the  lead  on the  aviation                                                                    
mapping project.  Ms. Baker  was not  sure. She  thought DNR                                                                    
and the university were  involved. Senator Huggins requested                                                                    
follow up on the question.                                                                                                      
                                                                                                                                
Senator  Olson  asked  about  the  mapping  method  and  the                                                                    
possibility that  it competes with private  organizations in                                                                    
Anchorage.  Ms. Baker  offered to  find  out. Senator  Olson                                                                    
wondered if  personnel would be  hired with the  funding for                                                                    
the Aviation Safety Program. Ms.  Baker said of the $750,000                                                                    
request, a  portion is providing  for an employee  that will                                                                    
be located in Aviation Operations  in Anchorage. The rest of                                                                    
the  work would  be  done through  contracts. Senator  Olson                                                                    
stated that one  person would be hired.  Ms. Baker clarified                                                                    
that the person has already  been working on the project for                                                                    
several years.                                                                                                                  
                                                                                                                                
10:13:45 AM                                                                                                                   
                                                                                                                                
CAP RN 30624                                                                                                                    
     Alaska Marine Highway System: Vessel and Terminal                                                                          
     Overhaul and Rehabilitation                                                                                                
     $8,000,000 Gen Fund                                                                                                        
                                                                                                                                
Ms.  Baker referred  to RN  30624 on  page 3.  She explained                                                                    
that certain  requirements are needed  in order to  keep the                                                                    
vessels   operational.  They   are  scheduled   during  each                                                                    
vessel's annual maintenance.                                                                                                    
                                                                                                                                
CAP RN 32534                                                                                                                    
     Capital Improvement Program Equipment Replacement                                                                          
     $1,500,000 CIP Rcpts                                                                                                       
                                                                                                                                
Ms. Baker discussed  RN 32534 on page 6.  She explained that                                                                    
these  are  equipment  needs that  are  related  to  project                                                                    
costs.  They  have  to  be   run  through  the  department's                                                                    
indirect cost  allocation because  they cannot be  funded by                                                                    
federal program dollars.                                                                                                        
                                                                                                                                
CAP RN 30648                                                                                                                    
     MH Coordinated Transportation and Vehicles                                                                                 
     $800,000 GF/MH                                                                                                             
     $250,000 MHTAAR                                                                                                            
                                                                                                                                
Ms. Baker  explained that RN  30648 on  page 7 is  an annual                                                                    
request   for  transit   funds  for   Mental  Health   Trust                                                                    
beneficiaries.                                                                                                                  
                                                                                                                                
CAP RN 36453                                                                                                                    
     Corps of Engineers-Harbor Program-Saint Paul                                                                               
     $700,000 GF Match                                                                                                          
                                                                                                                                
Ms. Baker  reported that RN  36453 on page 9  represents the                                                                    
last portion of the match  funds that are needed to complete                                                                    
this project.                                                                                                                   
                                                                                                                                
CAP RN 48926                                                                                                                    
     Highways and Facilities                                                                                                    
     $7,022,000 Gen Fund                                                                                                        
     $15,000,000 Hwy Capitl                                                                                                     
                                                                                                                                
Mr.  Richards detailed  RN 48926,  page 10.  He noted  there                                                                    
were  sub-allocations  for  $22   million.  The  first  sub-                                                                    
allocation is  RN 6391 for  Americans with  Disabilities Act                                                                    
Compliance Projects.  This funding  will be used  to address                                                                    
needs within buildings for  ramps, access restroom upgrades,                                                                    
and automatic doors.                                                                                                            
                                                                                                                                
10:16:22 AM                                                                                                                   
                                                                                                                                
CAP RN 48797                                                                                                                    
     Central Region Signal Malfunction Management Units                                                                         
     $22,000 Gen Fund                                                                                                           
                                                                                                                                
Mr. Richards explained  RN 48797 on page 12.  The request is                                                                    
for control units within the  boxes at intersections outside                                                                    
the  municipality  of  Anchorage,  primarily  in  MatSu  and                                                                    
Kenai.                                                                                                                          
                                                                                                                                
CAP RN 49031                                                                                                                    
     Highway Safety Corridors Near-Term Improvements                                                                            
     $5,000,000 Gen Fund                                                                                                        
                                                                                                                                
Mr. Richards detailed RN 49031,  page 13. The highway safety                                                                    
corridors  are portions  of highways  where there  are major                                                                    
accidents and  fatalities. The allocation  will be  used for                                                                    
near-term   items  such   as  information   signs,  improved                                                                    
intersections,  and  traffic  signals in  order  to  improve                                                                    
safety on those highways.                                                                                                       
                                                                                                                                
CAP RN 48754                                                                                                                    
     Manley Hot Springs Shop/Snow Removal Equipment                                                                             
     Building (SREB)                                                                                                            
     $900,000 Gen Fund                                                                                                          
                                                                                                                                
Mr. Richards turned  to RN 48754 on page  14. The department                                                                    
is building  a new airport  in Manley Hot Springs  using FAA                                                                    
funds. It  will include  a snow removal  equipment building.                                                                    
There is  also a highway maintenance  station. General funds                                                                    
will  be  needed  to  add  square  footage  to  the  airport                                                                    
building in  order to  allow the department  to end  a lease                                                                    
agreement for a substandard building.                                                                                           
                                                                                                                                
10:17:58 AM                                                                                                                   
                                                                                                                                
Co-Chair Hoffman asked for a  list of snow removal equipment                                                                    
buildings planned for rural Alaska  in the next three years.                                                                    
Mr. Richards agreed to do so.                                                                                                   
                                                                                                                                
CAP RN 48855                                                                                                                    
     Northern Region Bike Path Equipment                                                                                        
     $100,000 Gen Fund                                                                                                          
                                                                                                                                
Mr.  Richards explained  RN 48855  on page  15. The  funding                                                                    
will  pay for  snow  removal equipment  -  a bobcat,  pickup                                                                    
plow, and sweeper - in  order to comply with federal highway                                                                    
requirements.                                                                                                                   
                                                                                                                                
Co-Chair  Stedman  mentioned  a  previous  discussion  about                                                                    
federal   government  requirements   for  snow   removal  on                                                                    
walkways. He  requested more information  how that  issue is                                                                    
handled statewide.  Mr. Richards responded that  the Federal                                                                    
Highway Administration  grants the state money  to construct                                                                    
highways  and ancillary  facilities;  however,  they do  not                                                                    
maintain  the  ancillary  facilities.  The  legislature  has                                                                    
provided money  to address snow removal  needs in Anchorage,                                                                    
Juneau,  and  Fairbanks.  The priority  list  includes  main                                                                    
highways,  secondary   highways,  school  bus   routes,  and                                                                    
finally,  ancillary routes  like sidewalks  and bike  paths.                                                                    
The equipment  request will allow the  department to address                                                                    
snow removal on ancillary routes.                                                                                               
                                                                                                                                
Senator  Huggins  noted a  challenge  in  MatSu is  lack  of                                                                    
pathways.                                                                                                                       
                                                                                                                                
10:21:05 AM                                                                                                                   
                                                                                                                                
CAP RN 48765                                                                                                                    
     Slana Maintenance Station Bunkhouse                                                                                        
     $350,000 Gen Fund                                                                                                          
                                                                                                                                
Mr. Richards addressed RN 48765  on page 16. He informed the                                                                    
committee  about  the  difficulty of  hiring  and  retaining                                                                    
employees  at the  Slana Station.  Building a  bunkhouse and                                                                    
implementing  a  new  schedule   should  help  resolve  that                                                                    
problem.                                                                                                                        
                                                                                                                                
CAP RN 30628                                                                                                                    
     State Equipment Fleet Replacement                                                                                          
     $15,000,000 Hwy Capitl                                                                                                     
                                                                                                                                
Mr. Richards addressed RN 30628  on page 17. This request is                                                                    
the authority to  spend the highway working  capital fund in                                                                    
order to replace old equipment.                                                                                                 
                                                                                                                                
CAP RN 41394                                                                                                                    
     Statewide Anti-icing Program                                                                                               
     $150,000 Gen Fund                                                                                                          
                                                                                                                                
Mr. Richards noted RN 41394  on page 18 allows for continued                                                                    
funding  for  anti-icing  equipment.  An  experimental  salt                                                                    
brine is currently  being used in Southeast  Alaska and will                                                                    
be expanded to other areas.                                                                                                     
                                                                                                                                
Co-Chair  Stedman  requested  additional  information  about                                                                    
chemicals used  for the purpose  of de-icing the  roads. Mr.                                                                    
Richards  responded  that  a  magnesium  chloride  salt  was                                                                    
previously used,  but now sodium  chloride with  a corrosion                                                                    
inhibitor  added,  which  is   less  costly,  is  used.  The                                                                    
corrosion inhibitor safeguards the  vehicles. The goal is to                                                                    
use an abundant, less costly product.                                                                                           
                                                                                                                                
Co-Chair Stedman  pointed out that  people have  a different                                                                    
impression.                                                                                                                     
                                                                                                                                
Senator  Egan asked  about corrosive  studies regarding  de-                                                                    
icing  chemicals. Mr.  Richards responded  that a  study was                                                                    
done by  the Pacific Northwest Snow  Fighters Association, a                                                                    
group  made   up  of  state  DOT's   and  salt  manufacturer                                                                    
suppliers.                                                                                                                      
                                                                                                                                
10:25:17 AM                                                                                                                   
                                                                                                                                
CAP RN 48921                                                                                                                    
     Regulatory Compliance                                                                                                      
     $2,041,000 Gen Fund                                                                                                        
                                                                                                                                
Mr.   Richards  turned   to  RN   48921  on   page  19,   an                                                                    
appropriation with suballocations RN 48798 and 48852.                                                                           
                                                                                                                                
CAP RN 48798                                                                                                                    
     EPA MS 4 Requirements-Municipality of Anchorage Sand                                                                       
     Storage Facilities                                                                                                         
     $1, 041,000 Gen Fund                                                                                                       
                                                                                                                                
Mr.  Richards  detailed  RN  48798 on  page  20.  Under  the                                                                    
current permit  beginning on  February 1,  2010, there  is a                                                                    
requirement  by   EPA  to   provide  covered   sand  storage                                                                    
facilities in  Anchorage by February  1, 2014.  This initial                                                                    
allocation   will  fund   the  design   efforts  for   three                                                                    
buildings; one  in Girdwood,  one in  Birchwood, and  one in                                                                    
Anchorage.                                                                                                                      
                                                                                                                                
Co-Chair Hoffman  asked why the  funds are multiplied  by 14                                                                    
in  2012, totaling  $14 million.  Mr. Richards  replied that                                                                    
based on conceptual designs, $14  million would be needed to                                                                    
construct  the  buildings.  The initial  allocation  for  $1                                                                    
million is  to come  up with a  design package  resulting in                                                                    
construction by  2014. Co-Chair Hoffman asked  if additional                                                                    
operation   dollars   would   be  required.   Mr.   Richards                                                                    
anticipated on-going operational costs of $185,000.                                                                             
                                                                                                                                
CAP RN 48852                                                                                                                    
     Statewide: GIS Mapping of Storm Drainage Systems for                                                                       
     EPA MS 4                                                                                                                   
     $1,000,000 Gen Fund                                                                                                        
                                                                                                                                
Mr. Richards explained  RN 48852 on page 21.  The request is                                                                    
also for compliance  with EPA permit MS 4. A  target date is                                                                    
February  1,  2013.  This  is the  state's  portion  of  GIS                                                                    
mapping. The state will work with Anchorage on the project.                                                                     
                                                                                                                                
Senator Thomas  understood that University  of Alaska  has a                                                                    
very  extensive GIS  program.  He  suggested contacting  the                                                                    
university regarding their program.  Mr. Richards offered to                                                                    
look into potential collaboration.                                                                                              
                                                                                                                                
Co-Chair  Stedman inquired  if all  projects fell  under the                                                                    
Statewide  Transportation  Improvement Program   (STIP). Mr.                                                                    
Richards  reported that  the projects  are not  in the  STIP                                                                    
program, but rather are general fund requests.                                                                                  
                                                                                                                                
10:29:01 AM                                                                                                                   
                                                                                                                                
Senator Huggins asked  about an area in Eagle  River that is                                                                    
commonly  flooded  every year.  He  wondered  if a  solution                                                                    
would result from the mapping project.                                                                                          
                                                                                                                                
Mr.  Richards thought  Senator Huggins  was  referring to  a                                                                    
subdivision  next to  the Glenn  Highway. He  explained that                                                                    
the  surface  waters  are   impacting  the  homeowners.  The                                                                    
department is working with the  municipality to put in a new                                                                    
cross  culvert. That  work is  slated to  be completed  this                                                                    
summer. Additional work within  the subdivision is necessary                                                                    
to capture the water and direct it to the culvert.                                                                              
                                                                                                                                
CAP RN 48941                                                                                                                    
     Roads to Resources                                                                                                         
     $15,000,000 Gen Fund                                                                                                       
                                                                                                                                
Mr.   Richards   explained  RN   48941   on   page  22,   an                                                                    
appropriation with sub-allocations. The  first project is RN                                                                    
41390 -  Dalton Highway  Including Surfacing  Materials. The                                                                    
legislature  has  been  supportive  of work  on  the  Dalton                                                                    
Highway  over  the last  four  years,  providing almost  $29                                                                    
million to  address heavy  maintenance for  surface drainage                                                                    
and embankment efforts. This allocation  allows that work to                                                                    
continue  and addresses  approximately 59  miles of  road to                                                                    
repair permafrost  degradation, raise  the grade,  and place                                                                    
delineators.                                                                                                                    
                                                                                                                                
Co-Chair Stedman  concluded that  none of the  projects were                                                                    
STIP projects and  none would obligate or  alter the forward                                                                    
STIP process.  Mr. Richards responded that  the projects are                                                                    
general fund  projects and address maintenance  needs. There                                                                    
are STIP projects  for the Dalton Highway, but  not in these                                                                    
areas at this time. There is no overlap of the projects.                                                                        
                                                                                                                                
Co-Chair Stedman  noted a concern  if the STIP  projects are                                                                    
altered. He clarified  that there is no  obligation of funds                                                                    
for future projects.                                                                                                            
                                                                                                                                
10:32:13 AM                                                                                                                   
                                                                                                                                
Senator  Thomas noted  that the  Haul Road  was lengthy  and                                                                    
required much  work. He pointed  out that there  appeared to                                                                    
be about $9 million over a  two-year period of time for road                                                                    
maintenance.  He asked  if there  was any  other maintenance                                                                    
money.                                                                                                                          
                                                                                                                                
Mr. Richards responded that there  was an annual maintenance                                                                    
budget for $16 million to  cover the responsibilities of the                                                                    
work crews  along the  414 miles of  highway. There  is also                                                                    
$14 million in the GO Bond allocated to the Dalton Highway.                                                                     
                                                                                                                                
Senator Thomas  asked if  Steese Highway  intersections were                                                                    
funded by the GO Bond. Mr. Richards believed so.                                                                                
                                                                                                                                
Senator  Egan  mentioned  new  types  of  delineators  which                                                                    
provided better  visibility for drivers. He  wondered if the                                                                    
department  had considered  using  them.  Mr. Richards  said                                                                    
that  there  is  a   federal  program  project  specifically                                                                    
designed to install those new delineators.                                                                                      
                                                                                                                                
Co-Chair  Stedman pointed  out  the difference  in past  and                                                                    
present definitions  of Roads to  Resources. In the  past it                                                                    
was  defined  as   opening  up  new  roads   to  new  areas;                                                                    
currently, it  seems to  be geared  for maintenance  use. He                                                                    
wondered  if there  had been  a philosophical  shift by  the                                                                    
administration.                                                                                                                 
                                                                                                                                
10:35:48 AM                                                                                                                   
                                                                                                                                
Mr. Richards  did not think  there had been  a philosophical                                                                    
shift. He  observed that maintenance  of the  Dalton Highway                                                                    
is  extremely important  to the  state because  it leads  to                                                                    
North Slope oil fields. The  next project listed is intended                                                                    
to  open up  lands to  provide better  access to  extracting                                                                    
natural resources within the state.                                                                                             
                                                                                                                                
CAP RN 39356                                                                                                                    
     Roads to Resources Program                                                                                                 
     $1,000,000 Gen Fund                                                                                                        
                                                                                                                                
Co-Chair Hoffman  stated that  in the  last four  years, the                                                                    
legislature  has  appropriated  $42  million  for  Roads  to                                                                    
Resources. This year the request  is only for $1 million. He                                                                    
said  he  was interested  in  four  projects: Links  on  the                                                                    
Alaska  Peninsula and  Bristol Bay,  Pebble Copper  North of                                                                    
Lake Illiamna,  and the  Williamsport to  Pile Bay  Road. He                                                                    
wondered  what  product would  result  from  the $1  million                                                                    
appropriation. He also wondered  about the drastic reduction                                                                    
of the request.                                                                                                                 
                                                                                                                                
Mr. Richards addressed the dollar  value for the program. He                                                                    
noted two  additional projects in  the program,  the Western                                                                    
Alaska Access Planning  Study and the road to  the Gubik Gas                                                                    
Fields. The million dollar request  will provide road access                                                                    
to mining and timber sites  - the smaller projects. Previous                                                                    
years' funding has  been used for the road to  Umiak and for                                                                    
roads to access timber sales.                                                                                                   
                                                                                                                                
Co-Chair  Hoffman  asked about  why  Donlin  Creek with  $32                                                                    
billion of resources is not  listed as a candidate for Roads                                                                    
to Resources.  Mr. Richards spoke of  conversations with the                                                                    
developers  and about  a federal  earmark  for the  project.                                                                    
Mixed  messages  were  received.   The  developers  had  the                                                                    
perspective of  developing the road  themselves so  it would                                                                    
not be a public road.                                                                                                           
                                                                                                                                
10:40:02 AM                                                                                                                   
                                                                                                                                
CAP RN 48781                                                                                                                    
     Roads to Resources: Western Access Project-Phase 1                                                                         
     $1,000,000 Gen Fund                                                                                                        
                                                                                                                                
Mr. Richards  informed the committee  that RN 48781  on page                                                                    
26 is  also known  as the  Road to  Nome. It  is a  500 mile                                                                    
road. Preliminary  studies have  been done. The  funds would                                                                    
be  used for  an  environmental  assessment and  preliminary                                                                    
engineering studies.                                                                                                            
                                                                                                                                
Co-Chair  Stedman  wondered if  the  project  would ever  be                                                                    
constructed.  He  preferred  to  see less  design  and  more                                                                    
action. Mr.  Richards explained the efforts  needed prior to                                                                    
construction, such as environmental impact permits.                                                                             
                                                                                                                                
Co-Chair Stedman  asked how  much it  would cost  to finally                                                                    
construct the road. Mr. Richards  said the entire project is                                                                    
500 miles  long and  would cost  approximately $2.3  to $2.7                                                                    
billion.  Co-Chair Stedman  asked how  many federal  dollars                                                                    
would  be used.  Mr.  Richards explained  that general  fund                                                                    
dollars would be  used, rather than federal  funds, in order                                                                    
to lessen costs and time.                                                                                                       
                                                                                                                                
10:44:07 AM                                                                                                                   
                                                                                                                                
Co-Chair Stedman  pointed out a  trend to use  general funds                                                                    
on new road projects. When  looking at smaller projects such                                                                    
as  a  road in  Kake,  general  funds are  not  forthcoming;                                                                    
instead money  is allocated for  design. He wondered  how to                                                                    
get away from design  planning and actually build something.                                                                    
Mr. Richards  spoke of the  requirements when  designing and                                                                    
building roads due  to state and federal  statutes. Roads to                                                                    
Resources' goal is  to open lands in order  to provide jobs.                                                                    
Various impacts have to be taken into consideration.                                                                            
                                                                                                                                
Co-Chair Stedman looked at the  history of road construction                                                                    
over the  last 30 years.  He expressed frustration  over the                                                                    
time  delays. He  used  an  example of  $5  billion for  one                                                                    
project versus smaller dollar  amounts for smaller projects.                                                                    
He  expressed frustration  regarding  the  inability to  get                                                                    
small  roads  in  Southeast  Alaska   built.  He  termed  it                                                                    
"political theater."                                                                                                            
                                                                                                                                
10:50:00 AM                                                                                                                   
                                                                                                                                
Senator  Olson  inquired  how many  requests  would  involve                                                                    
community input  in Native land  areas. Mr.  Richards stated                                                                    
that  there is  public  process in  the following  projects:                                                                    
Western Access  and Foothills West. Senator  Olson concluded                                                                    
that none of the money would  be used for future hearings in                                                                    
the communities. Mr. Richards clarified that there would be                                                                     
community involvement.                                                                                                          
                                                                                                                                
Senator Olson agreed with Co-Chair Stedman's frustration                                                                        
about the delayed-time factor and excessive bureaucracy in                                                                      
road projects.                                                                                                                  
                                                                                                                                
10:52:31 AM                                                                                                                   
                                                                                                                                
Senator Thomas was not sure that the road to Nome, as                                                                           
defined, would connect the road to accessible mineral                                                                           
projects. He suggested an alternative.                                                                                          
                                                                                                                                
Mr. Richards agreed with Senator Thomas's comments about                                                                        
the access road.                                                                                                                
                                                                                                                                

Document Name Date/Time Subjects
SB 230 2010 02 26 OMB re FY11 Cap Process.pdf SFIN 3/16/2010 9:00:00 AM
SB 230
Project review listings for DM projects White.pdf SFIN 3/16/2010 9:00:00 AM
SB 253
Project review listings for amended DM projects Green.pdf SFIN 3/16/2010 9:00:00 AM
SB 253