Legislature(2021 - 2022)BELTZ 105 (TSBldg)

03/23/2021 01:30 PM Senate TRANSPORTATION

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Audio Topic
01:41:45 PM Start
01:42:20 PM SB74
02:07:13 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Moved CSSB 74(TRA) Out of Committee
**Streamed live on AKL.tv**
        SB 74-G.O. BONDS: STATE INFRASTRUCTURE PROJECTS                                                                     
1:42:20 PM                                                                                                                    
CHAIR MYERS  announced the  consideration of  SENATE BILL  NO. 74                                                               
"An Act  providing for  and relating to  the issuance  of general                                                               
obligation  bonds for  the purpose  of paying  the cost  of state                                                               
infrastructure projects,  including construction, communications,                                                               
major  maintenance, public  safety, and  transportation projects;                                                               
and providing for an effective date."                                                                                           
CHAIR MYERS solicited a motion.                                                                                                 
1:42:50 PM                                                                                                                    
SENATOR SHOWER moved  to adopt the committee  substitute (CS) for                                                               
SB  74,  [work  order  32-GS1716\B]. There  being  no  objection,                                                               
Version B was adopted as the working document.                                                                                  
1:43:16 PM                                                                                                                    
SENATOR KIEHL  moved to adopt  Amendment 1  to SB 74,  Version B,                                                               
[work order 32-GS1716\B.1].                                                                                                     
                          AMENDMENT 1                                                                                       
OFFERED IN THE SENATE                          BY SENATOR KIEHL                                                                 
     TO:  CSSB 74(TRA), Draft Version "B"                                                                                       
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1:43:20 PM                                                                                                                    
CHAIR MYERS objected for discussion purposes.                                                                                   
1:43:22 PM                                                                                                                    
SENATOR  KIEHL  explained  that  Amendment  1  would  delete  the                                                               
remaining projects  in the GO [General  Obligation] bond proposal                                                               
with federal  match for  [Federal Highway  Administration (FHWA)]                                                               
transportation projects  and [Airport Improvement  Program (AIP)]                                                               
airport formula funding.                                                                                                        
SENATOR  KIEHL stated  that  the  committee previously  discussed                                                               
whether using GO bonding for  projects with the federal match was                                                               
the best  way to fund  projects since  these projects are  in the                                                               
STIP or  AIP and  will be constructed  using those  processes. He                                                               
said he could  not recall any instance where the  state failed to                                                               
appropriate  the   match.  Further,  using  GO   bonds  will  not                                                               
accelerate the  projects. He preferred to  replace these projects                                                               
with  ones that  will move  Alaska's economy  forward or  address                                                               
major  challenges the  state faces.  He argued  against using  GO                                                               
bonds in this way.                                                                                                              
1:44:56 PM                                                                                                                    
SENATOR MICCICHE stated that he  could support Amendment 1 if the                                                               
projects  had  a  very  high  match  rate  and  were  limited  to                                                               
highways. He  predicted that  this bond package  was to  pass; it                                                               
would  accelerate  projects over  and  above  the normal  capital                                                               
budget  process. While  he said  he  struggles with  the GO  Bond                                                               
concept,  some  of the  projects  in  SB  74 are  critical  ones,                                                               
including  the Dalton  Highway,  bridges at  Montana, Sheep,  and                                                               
Goose Creeks, Seward Highway and  Sterling Highway, he said. Some                                                               
of these  highways are  severely damaged  and need  public safety                                                               
improvements  and repairs.  He said  he wished  Amendment 1  only                                                               
pertained to  [highway] projects,  but it  does not.  When people                                                               
seek to reduce  the state's budget, they  don't envision reducing                                                               
funds  for  transportation  or   public  safety  but  rather  for                                                               
peripheral things the  state can no longer  afford. Therefore, he                                                               
could not support Amendment 1.                                                                                                  
1:46:28 PM                                                                                                                    
SENATOR  SHOWER said  he echoes  Senator Micciche's  comments. He                                                               
stated  that he  considered offering  several amendments  but did                                                               
not do so due to the GO Bond funding source.                                                                                    
CHAIR MYERS removed his objection.                                                                                              
1:48:06 PM                                                                                                                    
At ease                                                                                                                         
1:48:17 PM                                                                                                                    
SENATOR KIEHL withdrew Amendment 1.                                                                                             
1:48:49 PM                                                                                                                    
SENATOR MICCICHE  asked if the  committee substitute (CS)  for SB
74, Version  B, incorporated the  committee's amendments  but did                                                               
not make any additional changes.                                                                                                
CHAIR  MYERS agreed  Version B  incorporated only  the amendments                                                               
the committee previously adopted.                                                                                               
1:49:30 PM                                                                                                                    
SENATOR  SHOWER  asked  the  record  to  reflect  that  while  he                                                               
supports many  of the projects in  SB 74, he has  a concern about                                                               
the  GO Bond  funding mechanism.  Many of  his constituents  have                                                               
called  him  about  the  West   Susitna  Access  Road,  which  he                                                               
acknowledged  is an  important  project that  will help  Alaska's                                                               
economy grow and provide  high-paying, sustainable jobs. However,                                                               
as   previously   mentioned,   the  state   has   a   substantial                                                               
infrastructure  needing repairs.  The  bond cost  will run  about                                                               
$100  million when  the  state currently  faces  a deficit.  Last                                                               
week's testimony  demonstrated that  many of these  projects were                                                               
already  fully   funded  by  other  funding   sources,  including                                                               
forthcoming federal funds, yet they were included in SB 74.                                                                     
1:52:24 PM                                                                                                                    
SENATOR  MICCICHE  emphasized  that   he  did  not  support  many                                                               
amendments  offered  on SB  74,  based  on  the GO  Bond  funding                                                               
source. He  reiterated that the state's  infrastructure needs are                                                               
critical.  His  constituents  travel  on a  highway  with  safety                                                               
issues.  He surmised  that when  the bond  package was  initially                                                               
considered,  the   administration  was  unaware   of  forthcoming                                                               
federal  COVID-19  funding  or the  federal  infrastructure  that                                                               
Congress will  likely pass. This  federal funding puts  the state                                                               
in a  very different position.  While the GO Bond  proposal would                                                               
accelerate  some regular  capital  budget  projects, likely  that                                                               
savings  would not  materialize by  using bonds,  he said.  After                                                               
thoroughly  considering the  financing  process,  he offered  his                                                               
preference to  only use GO  Bonds on projects. He  maintained his                                                               
view  that the  projects  are important  ones  that will  enhance                                                               
public safety.  However, the  committee decided  that forthcoming                                                               
federal  funding will  allow  the state  to  fund these  projects                                                               
without the burden of using GO bonds.                                                                                           
1:55:39 PM                                                                                                                    
CHAIR  MYERS  remarked  that  the legislature  uses  a  slow  and                                                               
deliberative process.                                                                                                           
1:56:00 PM                                                                                                                    
SENATOR  SHOWER offered  to forward  the report  highlighting the                                                               
cost of  bonding to the  committee. He echoed  Senator Micciche's                                                               
comments  that federal  funding  was not  likely  known when  the                                                               
administration  prepared   the  bill.  He  maintained   that  his                                                               
concerns  were not  based on  the merits  of projects  but rather                                                               
that other funding sources were preferable.                                                                                     
1:57:22 PM                                                                                                                    
At ease                                                                                                                         
1:57:45 PM                                                                                                                    
CHAIR MYERS reconvened the committee and solicited a motion.                                                                    
1:58:10 PM                                                                                                                    
SENATOR SHOWER moved to report  the committee substitute (CS) for                                                               
SB 74,  work order 32-GS1716\B,  as amended, from  committee with                                                               
individual recommendations and forthcoming fiscal note(s).                                                                      
CHAIR  MYERS said  Legislative Legal  is authorized  to make  any                                                               
necessary technical and conforming changes.                                                                                     
1:58:55 PM                                                                                                                    
At ease                                                                                                                         
2:05:07 PM                                                                                                                    
CHAIR MYERS reconvened the meeting.                                                                                             
[The  committee  treated  it  as   though  the  motion  had  been                                                               
2:05:18 PM                                                                                                                    
SENATOR SHOWER  stated a revised  motion. He moved to  report the                                                               
committee  substitute (CS)  for  SB 74,  work order  32-GS1716\B,                                                               
from  committee with  individual recommendations  and forthcoming                                                               
revised fiscal note(s).                                                                                                         
CHAIR  MYERS found  no objection  and CSSB  74(TRA) was  reported                                                               
from the Senate Transportation Standing Committee.                                                                              

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