Legislature(2005 - 2006)BUTROVICH 205

03/31/2005 01:30 PM Senate TRANSPORTATION

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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSSSSB 16(TRA) Out of Committee
Moved SB 133 Out of Committee
Bills Previously Heard/Scheduled
         SB 16-POWERS/DUTIES DOTPF/TRANSPORTATION PLAN                                                                      
2:04:09 PM                                                                                                                    
CHAIR HUGGINS announced SB 16 to be up for consideration.                                                                       
SENATOR COWDERY  moved to adopt  a committee substitute  (CS) for                                                               
the  sponsor substitute  for SB  16(TRA). Hearing  no objections,                                                               
the motion carried.                                                                                                             
2:04:48 PM                                                                                                                    
JEFF OTTESEN,  director, Department of Transportation  and Public                                                               
Facilities (DOTPF)  advised the  committee the  previous concerns                                                               
with SB 16  have been addressed. He explained the  changes to the                                                               
committee.  Page  3, line  19  delete  "periodically" and  insert                                                               
"every five  years". Page  4, line  23 delete  "periodically" and                                                               
insert "every  four years". Page 5,  line 31 is a  new subsection                                                               
that  requires cost  effective analysis  for  projects that  fall                                                               
into the threshold.                                                                                                             
2:07:14 PM                                                                                                                    
MR. OTTESEN  recommended the committee  delay the  effective date                                                               
to  July 2006  due to  future  projects approved  by the  voters,                                                               
which are well underway.                                                                                                        
2:08:05 PM                                                                                                                    
SENATOR THERRIAULT  moved to  adopt Amendment  1. There  being no                                                               
objection, the motion carried.                                                                                                  
CHAIR HUGGINS asked Mr. Ottesen to speak of public facilities.                                                                  
MR. OTTESEN advised the DOT's  Public Facilities was created upon                                                               
the merger of the old  departments of highways and departments of                                                               
public works. The DOTPF inherited  the duties of public works for                                                               
state buildings  as well as  many works for  smaller communities.                                                               
Through  time, the  smaller  duties  have essentially  dissolved.                                                               
Smaller communities now perform their own public works.                                                                         
2:10:08 PM                                                                                                                    
CHAIR  HUGGINS commented  the DOTPF  was attempting  to implement                                                               
business practicality.                                                                                                          
MR. OTTESEN agreed.  He pointed out AS  44.42.020(a) Paragraph 11                                                               
requires  the DOTPF  to annually  evaluate  cost, efficiency  and                                                               
availability  of alternative  fuels  such as  natural gas.  Since                                                               
natural gas is  no longer considered the fuel of  the future, DOT                                                               
will watch the rest of the world for alternative fuel trends.                                                                   
2:11:56 PM                                                                                                                    
MR. OTTESEN  added Section 2;  paragraph 15 is a  new requirement                                                               
to study  alternative funding. Other  states are looking  for new                                                               
funding for DOT such as mileage taxes and toll roads.                                                                           
2:13:10 PM                                                                                                                    
SENATOR FRENCH  asked Mr. Ottesen  to describe the  difficulty in                                                               
cost/benefit analysis studies.                                                                                                  
MR. OTTESEN  referred to Section  3, line  6. A road  project had                                                               
been in the  works since the 1970s and in  2002 litigation halted                                                               
the  project   since  they  had  not   performed  a  cost/benefit                                                               
2:15:15 PM                                                                                                                    
MR. OTTESEN added the DOTPF  has written a regulation saying they                                                               
will consider the  costs and benefits for all  projects. There is                                                               
no minimal threshold to which  the current language applies. City                                                               
governments are  required to do  their own  cost/benefit analysis                                                               
studies before they can submit projects to the DOTPF.                                                                           
2:18:43 PM                                                                                                                    
SENATOR   FRENCH  commented   regulations  would   dictate  their                                                               
MR.  OTTESEN agreed  regulations would  help define  cost/benefit                                                               
studies as well as local projects.                                                                                              
SENATOR FRENCH asked  Mr. Ottesen how the proposed  new law would                                                               
have voided litigation.                                                                                                         
MR. OTTESEN said it wouldn't.                                                                                                   
2:21:26 PM                                                                                                                    
SENATOR FRENCH  asked Mr. Ottesen  how the DOTPF would  treat the                                                               
road to the Kenai Peninsula.                                                                                                    
MR. OTTESEN answered they would treat it as an existing highway.                                                                
SENATOR FRENCH  asked Mr. Ottesen  to explain how the  new system                                                               
is different than the old.                                                                                                      
MR. OTTESEN advised many new roads are being proposed.                                                                          
SENATOR  FRENCH  said  he  is   unclear  whether  a  cost/benefit                                                               
analysis  is required  for projects  such as  widening the  Parks                                                               
Highway or straightening the Seward Highway.                                                                                    
MR. OTTESEN  advised under  the new  law the  DOTPF would  not be                                                               
required  to   perform  a   cost/benefit  analysis.   Section  5;                                                               
Subsection (e) singles out evaluating  of new highways, airports,                                                               
and other major components.                                                                                                     
SENATOR FRENCH  commented the intent of  SB 16 is to  stop having                                                               
to do cost/benefit analysis for every upgrade in the state.                                                                     
MR.  OTTESEN  agreed.  They  spent   close  to  $100,000  on  one                                                               
cost/benefit study for one rural project.                                                                                       
SENATOR  FRENCH  noted  the   sponsor  statement  says  requiring                                                               
studies to be done 10 years in advance is burdensome.                                                                           
2:24:03 PM                                                                                                                    
SENATOR FRENCH added  the new language still requires  them to do                                                               
the cost/benefit study on new projects far in advance.                                                                          
MR.  OTTESEN  clarified the  current  language  uses the  phrase,                                                               
"consider cost  and benefits." That  does not necessarily  mean a                                                               
cost/benefit analysis  is required. There are  several techniques                                                               
one  can use  to consider  costs and  benefits. A  cost effective                                                               
analysis is a much simpler technique  and can be done on an excel                                                               
spreadsheet.  The  court case  revolved  around  whether DOT  was                                                               
using the correct methodology.                                                                                                  
2:26:22 PM                                                                                                                    
SENATOR FRENCH asked  Mr. Ottesen whether the  DOTPF was required                                                               
to do a cost/benefit analysis under the old statute.                                                                            
MR. OTTESEN  answered no.  The new statute  would clarify  when a                                                               
cost/benefit analysis is required.                                                                                              
2:28:34 PM                                                                                                                    
SENATOR  COWDERY   moved  CSSSSB  16(TRA)  from   committee  with                                                               
individual  recommendations and  attached  fiscal note(s).  There                                                               
being no objection, the motion carried.                                                                                         

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