Legislature(2005 - 2006)BUTROVICH 205
03/31/2005 01:30 PM Senate TRANSPORTATION
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* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was 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 analysis. 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 options. 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.