Legislature(1999 - 2000)
01/27/2000 01:35 PM Senate TRA
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
SB 189-INTERNATIONAL AIRPORT AUTHORITY
MR. BEN GRENN, legislative aide for Senator Kelly, read the
following sponsor statement:
The public process surrounding the implementation of an Alaska
Airport Authority combining Alaska's two international
airports promises to be comprehensive. The process will allow
the public and affected organizations to review the proposed
legislation and begin a thorough discussion of its merits.
Forming an airport authority encourages the development of
trade on a statewide level and allows the Anchorage
International Airport and Fairbanks International Airport to
benefit from the economies offered by a single administrative
body. The proposed board structure will give this authority
the long term management stability it needs to more
effectively and rapidly respond to fast-changing world market
conditions.
Only Alaska and Hawaii have regional international airports
that are state operated. The other 48 states international
airports are run by authority systems.
Concern may arise over some elements of this legislation. The
term authority can be misleading and even inaccurate in
implying a voracious and autonomous self-sustaining public
body. Some authorities do in fact meet that criteria.
However, in SB 189 the Governor of Alaska will appoint the
members of the board of directors and the legislature will
review and appropriate the budget. All things done by the
authority are public and the acquisition of land by eminent
domain may take place only with prior approval of the
governor.
Responsibility to repay existing airport bonds is assumed by
the authority, and the authority also assumes repayment of new
bond issues. Existing state employees transferred to the
authority become authority employees, and transfer with their
collective bargaining agreements for the duration of that
contract. These employees continue to participate in their
existing retirement benefit programs. The authority may
choose to engage in collective bargaining with its employees.
Senate Bill 189 provides for the continuation of litigation,
hearings, investigations and other proceedings that were begun
under a law that was amended or repealed by this Act,
notwithstanding the amendment or repeal of that law.
Likewise, regulations adopted under pre-existing law remain in
effect for the term adopted or until repealed.
This legislation requires the authority to annually prepare a
concise report for the governor, legislature, mayors of the
Municipality of Anchorage, the Fairbanks North Star Borough
and the City of Fairbanks describing the operations, income
and expenditures of the authority for the prior fiscal year.
MS. SHERRY MCCONNELL, Chair of the Port Association of Louisiana,
stated Louisiana has 26 port authorities that are political
subdivisions of the state. The authorities are statutorily
established and governed by a local body of commissioners.
Number 472
SENATOR PEARCE asked if the enabling statute allows parishes to
have more than one port authority, or whether authorities can cross
parish lines.
MS. MCCONNELL answered she did not know of a prohibition for
crossing parish lines. She deferred to Mr. Prejean to elaborate on
the issue.
SENATOR PEARCE asked if authorities have powers by statute of
eminent domain.
MR. PREJEAN answered parishes can have more than one port
authority, and authorities do have the right of eminent domain but
it is not absolute--there has to be a court process. None of the
ports share jurisdiction.
CHAIRMAN WARD confirmed that Louisiana has appointed and elected
port commissioners, and he asked for clarification of the umbrella
organization.
MR. PREJEAN responded the umbrella organization is a trade
organization which meets monthly and works with the legislature on
port issues.
Number 737
SENATOR PEARCE asked if authorities have jurisdiction over
airports.
MR. PREJEAN responded they are traditional port authorities.
SENATOR PEARCE asked if the New Orleans International Airport is
operated by the city or by an authority.
MR. PREJEAN answered the airport is operated by a commission
appointed by the city.
Number 870
CHAIRMAN WARD asked if Louisiana authorities have powers of
taxation on land.
MR. PREJEAN responded yes, most of the capital projects are
supported by the state through a transportation trust fund.
CHAIRMAN WARD asked when the ports became port authorities were
lands transferred to the authorities.
MR. PREJEAN answered land was not transferred to start ports. Land
donations came from private land owners or from land purchases.
Airports in Louisiana are a portion of the Louisiana Trust Fund and
they receive monies to match federal funds for construction.
MS. MCCONNELL clarified that most ports started with a port
authority whose mission was to start ports.
MR. PREJEAN agreed.
SENATOR PEARCE asked Mr. Grenn if this bill is similar to one she
introduced in 1996.
MR. GRENN responded yes.
MR. DOYLE RUFF, Manager of the Fairbanks International Airport,
presented the Department of Transportation and Public Facilities'
(DOTPF) position on SB 189. The department disagrees with
language in the bill saying the viability and competitive position
of the Anchorage and Fairbanks International Airports would be best
protected under the operation of an independent authority.
Alaska's international airports are being operated in an efficient,
responsive and business-like manner and they are being operated
with the best interest of all Alaskans and visitors in mind.
DOTPF believes there is no point in fixing something that is not
broken, and it believes the department should be recognized for
some of its successes.
The international airport system has continued to grow, and cargo
has grown in excess of 6% per year in the last 5 years--Anchorage
is ranked the number one "all cargo airport" in the country and
Fairbanks is ranked number thirty six. Over $100 million of
private investments have been committed and there have been over
$350 million in infrastructure improvements.
DOTPF is concerned that creating an authority would create another
level of bureaucracy and confusion. Fairbanks or Anchorage board
members could veto a decision proposed by the board causing a block
vote. The bill also does not assure airport independence, and it
may eliminate airport managers and staff.
The department feels this bill defeats the purpose of
transportation planning, and the goals of the bill can best be
accomplished within the existing system.
Number 1409
SENATOR LINCOLN commented the sponsor statement says only Alaska
and Hawaii have state operated international airports, other
international airports are run by authority systems. She asked for
Mr. Ruff's response.
MR. RUFF responded only three states have airports under DOT--
Alaska, Hawaii and Maryland. With regard to airports that are
under authorities, Anchorage is one of the top one hundred airports
based on total passengers--ranked 58. The top one hundred airports
are broken down into hubs--large, medium and small. Anchorage is
a medium hub, Fairbanks is a small hub. Of the large hubs, 12 out
of 28 are operated by authorities. There are 19 out of 44 medium
hubs operated by authorities, and 11 out of 28 small hubs operated
by authorities.
SENATOR LINCOLN stated that the fiscal note attached to the bill
for 2001 is $401,000, she asked Mr. Ruff what the cost differential
will be.
MR. RUFF responded he would defer to other staff at DOTPF, but he
feels the legislation would create a need for additional staff and
expenses.
SENATOR LINCOLN responded additional staff is not mentioned in the
analysis of the fiscal note, and she asked if there is support from
the Anchorage and Fairbanks assemblies.
MR. RUFF answered that Mr. James Dodson should answer Senator
Lincoln's question.
SENATOR PEARCE asked how much of the overhead costs are charged
back to airports by DOTPF to pay for the Commissioner and his
staff.
MR. RUFF responded the requirements within the legislation demand,
in his opinion, a constant staff for meeting the reporting
requirements.
Number 1770
MR. JAMES DODSON, representing the Mayor and Chamber of Commerce of
Fairbanks, stated Fairbanks opposed this legislation in 1996 and is
still concerned about this issue. The city will voice its position
at a later time.
CHAIRMAN WARD set SB 189 aside until the sponsor and DOTPF have
more time to address the concerns brought to committee's attention.
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