Legislature(2009 - 2010)HOUSE FINANCE 519
02/11/2010 01:30 PM House FINANCE
| Audio | Topic |
|---|---|
| Start | |
| HB300 || HB302 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| += | HB 300 | TELECONFERENCED | |
| += | HB 302 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| + | TELECONFERENCED |
HOUSE FINANCE COMMITTEE
February 11, 2010
1:38 p.m.
1:38:16 PM
CALL TO ORDER
Co-Chair Hawker called the House Finance Committee meeting
to order at 1:38 p.m.
MEMBERS PRESENT
Representative Mike Hawker, Co-Chair
Representative Bill Stoltze, Co-Chair
Representative Bill Thomas Jr., Vice-Chair
Representative Allan Austerman
Representative Mike Doogan
Representative Anna Fairclough
Representative Neal Foster
Representative Les Gara
Representative Reggie Joule
Representative Mike Kelly
Representative Woodie Salmon
MEMBERS ABSENT
None.
ALSO PRESENT
Leo von Scheben, Commissioner, Department of Transportation
and Public Works; Frank Richards, Deputy Commissioner of
Highway and Public Facilities, Department of Transportation
and Public Works; Jim Beedle, Deputy Commissioner of Marine
Operations, Department of Transportation and Public Works;
Laura Baker, Director, Administrative Services, Department
of Transportation and Public Works;
PRESENT VIA TELECONFERENCE
1:38:29 PM
SUMMARY
HB 300 APPROP: OPERATING BUDGET/LOANS/FUNDS
HB 300 was HEARD and HELD in Committee for further
consideration. Overviews were presented by the
following departments:
Department of Transportation and Public Works
HB 302 APPROP: MENTAL HEALTH BUDGET
HB 302 was HEARD and HELD in Committee for further
consideration.
1:38:47 PM AT EASE
1:41:26 PM RECONVENE
HOUSE BILL NO. 300
"An Act making appropriations for the operating and
loan program expenses of state government, for certain
programs, and to capitalize funds; making supplemental
appropriations; making appropriations under art. IX,
sec. 17(c), Constitution of the State of Alaska; and
providing for an effective date."
HOUSE BILL NO. 302
"An Act making appropriations for the operating and
capital expenses of the state's integrated
comprehensive mental health program; and providing for
an effective date."
1:42:53 PM
Co-Chair Hawker discussed housekeeping.
1:43:02 PM
DEPARTMENT OF TRANSPORTATION AND PUBLIC WORKS
LEO VON SCHEBEN, COMMISSIONER, DEPARTMENT OF TRANSPORTATION
AND PUBLIC FACILITIES, offered the FY2011 Operating Budget
Overview for discussion (copy on file). He shared the
department's mission statement found on Slide 2 of the
overview:
Department Mission: Provide for the safe movement of people
and goods and the delivery of State services.
Department Core Services:
· The department is statutorily responsible for the
planning, design, construction, maintenance, and
operations of transportation facilities and buildings.
· Maintenance & Operations of State Transportation
Systems: Highways, Airports, Alaska Marine Highway
System, Public Facilities, Ports and Harbors and State
Equipment Fleet.
· Measurement Standards/Commercial Vehicle Enforcement
· Transportation & Facilities Construction Program
· Program and Administrative Support
Commissioner von Scheben stated that the FY2011 governor's
budget was $236.2 million, and was distributed over three
priority program areas; Maintenance & Operations of State
Transportation Systems, Measurement Standards/Commercial
Vehicle Enforcement, and the Transportation & Facilities
Construction Program. He discussed Slides 3, 4, and 5, which
illustrated the distribution details of the department's
total general fund request:
Maintenance & Operation of State Transportation Systems was
important to the safety of public use of the state's
transportation systems; supported economic development in
terms of travel industry, general public, and commercial
vehicle transportation, etc. The total FY2011 governor's
request was $227,474.0.
Results of Current Capacity:
· In 2008 Alaska experienced 1.29 traffic fatalities per
100 million VMT, a decrease of 18.87 percent from 2007,
and compared to the national 2008 average of 1.27.
· The work-related injury rate of department employees
decreased from 4.7 on 2008 to 3.2 in 2008, a reduction
of 31.9 percent.
· The Fairbanks International Airport's occupational
injury and illness incidence rate increased from 12.1
in 2007 to 15.3 in 2008, which is above the national
rate of 9.9.
· The rate of public injuries and incidents decreased
from 1.7 in FY2007 to 1.2 percent in FY2008.
· Customer satisfaction with the Marine Highway System
had stayed strong at 96.5 percent for the 5th year in a
row, with a high percentage of respondents giving an
excellent rating.
· Customer satisfaction in transportation services in
2008 compared to 2005 has remained constant at 80
percent.
· Government sector customer satisfaction had remained
high at 94 percent for state equipment fleet and
increased from 83 percent to 84 percent for facilities
between FY2008 and FY2009.
· Rural airport revenues collected in FY2009 exceeded the
target of 5 percent and increased by 6.3 percent over
the prior year.
1:48:39 PM
Commissioner von Scheben continued to Slide 4:
Measurement Standards/Commercial Vehicle Enforcement reduces
the risk of accidents or road damage from unsafe commercial
vehicles and/or loads. The total FY2011 governor's request
was for $1,946.7 million.
Results of Current Capacity:
· 99.2 percent of the commercial motor vehicles that were
inspected in 2009 were weight compliant.
· Fatalities resulting from accidents involving
commercial motor vehicles decreased by 28.57 percent
from 7 in 2007 to 5 in 2008, which is less than the 5
year average of 7.2 fatalities.
Commissioner von Scheben continued to Slide 5:
Transportation and Facilities Construction Program provides
the planning and management of construction projects across
the department. This includes major repair and
rehabilitation of all transportation modes, and state owned
facilities, operated and maintained by the State of Alaska.
The total FY2011 governor's request was $6,761.8 million.
Results of Current Capacity:
The percentage difference between bid and final contractor
payments increased to 12 percent in 2009. By using the last
three fiscal years for source date, the department has
established a three year average of about 10 percent that
was still short of the 8 percent goal.
Commissioner von Scheben listed the top accomplishments
achieved by the department in 2009:
Ted Stevens International Airport A & B Concourses:
· Opened for business on November 2, 2009
· Passenger/Baggage screening centralized
· A & B Concourses 352,000 ft2 renovation
Fairbanks Passenger Terminal:
· Opened May 7, 2009
· Authorized $96.2M
· Cost $92.3M
1:52:28 PM
Commissioner von Scheben cited Slide 8, which listed the
Dowling Road Extension, the Sitka Roundabout, and the North
Pole Interchange as areas of 2009 highway improvements.
Slide 9 illustrated the Alaska Marine Highway System (AMHS)
improvements:
· 92 percent on Time Departures
· 96 percent customer satisfaction level
· Schedule
· Winter '09/Spring '10 released July 17th
· Summer '10 schedule released October 1st
· Power Management/ Fuel Savings
· Alaska Class Ferry-STIP Funding Approved
Commissioner von Scheben continued to Slide 9, which was a
photograph of the crew of the M/V Taku, receiving and award
from the Coast Guard. The crew had rescued two people
onboard a burning fishing vessel.
Co-Chair Hawker pointed out that he AMHS has been
responsible for saving many lives, and that this was a most
recent example of a long and distinguished history of
helping vessels in need of aid. Commissioner von Scheben
agreed.
1:55:42 PM
Commissioner von Scheben continued to Slide 11, which
detailed achievements in the Highway Safety Corridors:
· Education
Include distracted and aggressive driving
http://www.youtube.com/user/asthwsads#p/u
http://www.youtube.com/watch?v=yjmAy2Q4BRY
· Enforcement
Bureau of Highway Patrol's 2nd year
· Engineering
Knik Goose Bay & Vine Rd; Knik Goose Bay &
Fairview Loop Signals
Sterling Highway Rut Repair
Commissioner von Scheben explained that the department had 4
years of funding for the Highway Safety Improvement Program
which, via the Department of Public Safety, placed highway
patrol officers at the safety corridors. Palmer and Wasilla
had also benefited from new stop lights and turnout
facilities. He continued to Slide 12:
Rumble Strips
· Installed on the Richardson Highway-2009
· Highway Safety Corridors-to be constructed in 2010
Commissioner von Scheben cited Slide 13, which illustrated
safety projects elsewhere:
Pedestrian Countdown Signals
· Reduce pedestrian crashes by 25 percent
· Started in Anchorage & Fairbanks in 2009
· 2010 complete Anchorage, Matsu and Kenai
Commissioner von Scheben stated that the department had
found that pedestrian countdown signals had a significant
effect in improving pedestrian safety. He continued to Slide
14:
Emergency Response
· Flooding
· Portage Road to Whittier Tunnel
· Highway Erosion
Commissioner von Scheben directed attention to Slides 15,
16, and 17, which contained photographic images of several
of the aforementioned emergencies.
1:59:55 PM
Commissioner von Scheben continued to Slide 18, which showed
that the department had worked with legislators through
committee meetings, House Transportation Committee
education, and a Dalton Highway trip. Slides 19 & 20
contained photographs of the various meetings with members
of the legislature. Slide 21 continued the list of DOT&PF
successes:
· Fatality rate dropped over 24 percent between 2006 and
2007
· ARRA and regular program
· Department safety
-3.2 injuries/illness per hundred employees
· Team Approach- DOT&PF and Consultants
Commissioner von Scheben explained that a year ago the
department had been tasked with the job of getting $250
million obligated for construction programs within one year.
As of February 5, 2010, every dollar had been obligated.
Slide 22 contained a chart which illustrated the "Team
Approach-DOT&PF and Consultants". He cited 2006 and 2007 as
examples of particularly successful years.
Representative Gara asked about the Rumble Strip Project. He
wondered if the lack of rumble strips along highways was
contributing to the instances of accidents.
FRANK RICHARDS, DEPUTY COMMISSIONER OF HIGHWAY AND PUBLIC
FACILITIES, DEPARTMENT OF TRANSPORTATION AND PUBLIC
FACILITIES, responded that the majority of accidents along
the highway safety corridors were due to inattentive
drivers. The department believed that the replacement of the
rumble strips in the highway safety corridors would prevent
accidents.
Representative Gara thought that the strips should be place
along the major portion of the state highway system for a
minimal cost. He expressed concern to limiting the rumble
strips to only the highway safety corridors. Mr. Richards
stated that the projects in the presentation were limited to
projects that would be completed in the summer of 2010, and
that the areas were chosen by the rates of fatalities. The
use of fog line side rumble strips were being considered for
other areas of the highway. He said he would get back to the
committee with the cost of the project. Representative Gara
said that the numbers would be appreciated.
2:06:19 PM
Co-Chair Hawker wondered where the funds came from for the
Alaska Highway Safety Office grants, and what the money was
being used for. Mr. Richards responded that the funds were a
combination of regular STIP program funds, and federal
dollars allotted to address specific highway safety needs.
The two combined federal fund sources allowed the department
to address safety needs through grants to the Bureau of
Highway Patrol and the Alaska State Troopers. Since the
inception of the Bureau of Highway Safety Patrol the trend
lines had shown less major injury accidents.
Co-Chair Hawker stated that in the Department of Public
Safety (DPS) budget there was an earmark for funding 5
trooper positions, the fund source was the AHSO/CIP funds.
He wondered how long the funds could be relied upon. Mr.
Richards replied that the department was in the second year
of a 4 year grant. Co-Chair Hawker asked if the state
received the same, or an increasing amount, each year. Mr.
Richards replied that it was the same amount each year. Co-
Chair Hawker wondered how the grant could fund 5 new
troopers this year, when it was spent on something else last
year. Mr. Richards thought that the funds had been spent to
recruit and train people for the trooper positions.
Co-Chair Hawker pointed out to the committee that DPS had
listed the request as a new increment to their base in this
year's budget. He thought that the point would need to be
clarified as the committee when further with the process. He
asked about Slide 17, which pictured the road near the
Whittier Tunnel. Mr. Richards clarified that the image was
of 400 thousand cubic yards of United States Government
rock. Co-Chair Hawker asked who owned the rock. Mr. Richards
replied that he rock came from the adjacent landowner,
Chugiak National Forest, and fell onto the state asset in
the slide. State resources were used to clean up and
stockpile the rock. Co-Chair Hawker referred to a 2 million
dollar supplemental request to remove the government rock
from the state road. Mr. Richards said the request was for
$2.3 million. He added that the department received a
portion of the rock from the Forest Service, and it was now
a state asset.
2:11:50 PM
Co-Chair Hawker asked if the exchange value for the rock
received was equitable to the work and effort performed by
the department to remove it. Mr. Richards was not sure of
the quantity of rock received by the state. He thought it
broke down to approximately $5.30 per cubic yard. Co-Chair
Hawker asked if recourse could be taken for federal rocks
falling on state roads, rather than the state footing the
clean-up bill. Mr. Richards said that there may be an
easement issue involved. Co-Chair Hawker requested a follow-
up on the issue. Mr. Richards said that there had been a
"lively" conversation with the adjacent landowner to seek
some share in the cost of the clean-up, but to no avail.
Representative Fairclough noted that the state was spending
equal amounts of money on highways and the marine highway.
She wondered how many people travel on the highway vs. the
marine highway.
JIM BEEDLE, DEPUTY COMMISSIONER OF MARINE OPERATIONS,
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES,
responded that the 2008 annual traffic volume report
reflected that 340,000 passengers, and 109,000 vehicles,
traveled on the AMHS. He stated that comparing the two was
difficult.
LAURA BAKER, DIRECTOR, ADMINISTRATIVE SERVICES, DEPARTMENT
OF TRANSPORTATION AND PUBLIC FACILITIES, added that the
statistics concerning the modes of transportation could be
provided at a later date.
2:17:26 PM
Representative Fairclough said that $140 million was spent
in FY2009 in the AMHS and $153 million was spent on
highways. She understood that services needed to be provided
to coastal communities, but wanted to know what was being
done to maintain the road system, which she believed used
for 90 percent of the travel in Alaska. She thought costs
could be streamlined in the AMHS.
2:19:13 PM
Representative Fairclough asked about the department's $6.1
million travel budget. Ms. Baker replied that given the
transportation needs across the state, and the lack of duty
stations in every location of construction, a significant
amount of travel was necessary in order for staff to
relocate to various projects. She said that a more detailed
breakdown of the travel budget could be provided at a later
date.
Representative Fairclough asked about the auditing of
federal monies and grants.
Co-Chair Hawker interjected that the state had spent money
in anticipation of receiving grant money, and then were
unable to realize the entire amount the state had spent in
anticipation of receiving a full federal award.
2:21:09 PM
Representative Fairclough wondered how often the federal
receipts were audited.
Ms. Baker replied that it was difficult for departments that
were receiving federal receipts to "get it down to the
penny", as the state fiscal year and the federal fiscal year
closed a different times. She listed ways in which the
departments were taking action; capable accountants were
overseeing the operating and capital dollars, and the
legislative audit group came in once a year to evaluate
federal compliance. Federal dollars that were coming in to
the department were coming in on the capital side, which
were for longer term projects, not the annual operating
costs that were built into the base budget. Obligation, in
the sense of federal grants, was unique because the
department had to list projects before money was granted.
2:24:11 PM
Representative Fairclough asked if the state had a
reciprocal agreement with the federal government to provide
free transportation for federal employees or other groups
traveling from out-of-state. Mr. Beedle explained that
certain employees of the federal government could apply for
free passes. The passes were available for under work status
only and uniforms must be worn at least twice a day. Most of
the passes were on a space available basis and were
negotiated in union contracts. Children were included; up to
age 18. Marketing passes existed for people writing travel
logs or books. Shore side people could receive business
passes.
2:28:41 PM
Representative Fairclough inquired about the aviation
component of the budget, specifically that the volcano
observatory, which had requested a backfill of federal
dollars because the federal resources were not going to be
available. It was suggested that the state should take
responsibility for the observatory funding, to ensure safe
international air travel. She wondered why the airport was
not contributing to the observatory personnel fees.
Commissioner von Scheben was aware of the situation, but did
not believe that the Anchorage airport had been approached
for the funding.
Representative Fairclough asked if the department had
considered the expense of the observatory when examining
airport expenses. She wondered about the details involved in
the possible absorption of the costs. Commissioner von
Scheben said he would get back to the committee with the
information.
Representative Fairclough said that general fund dollars
were being requested for the observatory and if it would
directly affect the airport it may be a cost that could be
shared, or transferred in some way, to those that use the
airport that depend on safety in that particular flight
pattern.
Commissioner von Scheben recalled a discussion on the issue
on the national level, including talks of a congressional
group that was trying to secure funding for the observatory.
He reiterated that he would provide the committee with more
information at a later date.
Co-Chair Hawker reiterated why should the legislature
appropriate general fund money to pay for the maintenance
and operation of the Alaska Volcano Observatory, when it
exists to provide air traffic safety internationally, and
was traditionally federally funded. Ms. Baker assured the
committee that she understood the question and would
research the issue.
2:32:53 PM
Representative Gara reiterated the request for information
on the cost of a statewide rumble strip program. Mr.
Richards replied that fog and center line rumble strip plans
were already planned for the major routes of the national
highway system.
2:35:03 PM
Representative Joule stated that the community of Ambler had
naturally occurring asbestos which made finding a clean
gravel source challenging. The closest clean gravel source
was 30 miles away and roads would need to be built in order
to haul gravel. He asked if it would be more beneficial to
the community to pave a runway, than build a road. He
stressed that the ability of the community to spend capital
dollars was hindered by the naturally occurring asbestos.
Mr. Richards stated that the naturally occurring asbestos
was a problem in other locations throughout the state. Over
the last few years the department had been examining dust
palliatives to determine what would have longevity on roads
and runways. The department felt that the reoccurring
application of the dust palliatives would more cost
effective in the long run.
2:40:52 PM
Representative Doogan questioned the Capital Improvement
Project Receipts for $132.6, which was found on the pie
chart on Slide 30. Ms. Baker said that the capital
improvement receipts on the chart reflected the personal
services costs of staff, within the operating budget, which
were spending time on the details of a capital project.
Representative Doogan understood that the department was
shifting money from the capital budget to the operating
budget to cover the costs. Ms. Baker said that when an
estimate for a project is projected it included what the
internal staff time would be, as well as the external
instruction costs like equipment and supplies. Under
statutory authority the department had to report personal
services operating position costs in the operating budget.
Ms. Baker continued. The Highway Working Capital Fund was
the funding for the management of the state equipment fleet.
2:45:30 PM
Representative Doogan thought that the department's travel
budget was expensive and requested more information on
travel spending.
Representative Austerman understood that $10 million had
been aside for the rebuild of the road in Kodiak between the
Coast Guard base and downtown. The project had cost $7
million. He wondered where the other $3 million would be
spent. He suggested the funds could be used for maintenance
at the state airport in Kodiak. Commissioner von Scheben
replies that leftover funds would be redistributed
throughout the state. Mr. Richards added that the
competitive nature of the bids for stimulus projects had
resulted in many projects coming in below the engineers
estimate. The department had come to the legislature to have
the funds used for other projects that were ready to begin.
The oversights placed in projects, by state legislation,
required both Title 23 eligible work, and LB&A
authorization.
Representative Austerman asserted that stimulus money was
intended to be used for projects that created jobs. Intent
language was put into the legislation in an attempt to
create smaller projects that local companies could bid on as
well as the larger companies in the state. He lamented that
the stimulus money, in the case of the Kodiak road, had
created only five jobs. He expressed frustration that small
construction companies in his community did not have the
bonding ability to contend for the larger projects.
2:50:03 PM
Commissioner von Scheben responded that the department was
held to regulations when obligating the stimulus dollars
within a very short timeframe. Sometimes the simplest
projects, which do not generate a lot of jobs, but can be
accomplished sooner, take priority.
Representative Austerman disagreed with the department's
approach. He felt that when one major construction company
was moved from community to community to do the work, local
people missed out on the opportunity for the jobs.
Representative Fairclough asked if there had been an
increase of contractors from out-of-state bidding on DOT/PF
projects. She also wondered how often the scales that weigh
baggage at the airports were checked for accuracy.
Commissioner von Scheben did not think the bidding by out-
of-state contractors was increasing. He listed current
outside contractors being used. He noted that the
contractors were hiring locally and using local sub-
contractors. He said that he could get back to the committee
with more information concerning the weights and measures at
airports.
2:54:05 PM
Mr. Richards stated that a significantly larger number of
firms, both Alaskan and out-of-state, bid on the stimulus
projects. He recalled that the only stimulus projects
awarded to outside firms were the Akiachak Airport project,
and the project at Trump Road, which went to a Washington
firm.
Co-Chair Hawker probes the issue of state competition
against the private sector. He questioned if the department
should be divested of the responsibility of pile drilling
operations, which could then be awarded to the private
sector. Mr. Richards replied the department is occasionally
required to rent the equipment it needs from the private
sector in order to drill the post holes. The department was
in charge of the routine replacement of the rail itself. He
asserted that the department was not as efficient as a
private contractor, who was set up with the necessary
equipment to perform the guard rail installation. He relayed
that the department put out contracts for repair and
replacement of guard rails, but did the minor work
independently. He acknowledged the issue was a long-standing
one, but added that the work done by the department with
state account forces and state equipment was a "fraction of
a decimal point of the entire capital budget."
Co-Chair Hawker pointed out the relative economic scale that
should be taken into consideration when comparing a state
department with a small business.
Mr. Richards agreed. He added that it was shown in the
operating budget that the CIP receipts had allowed for the
retention of equipment operators and mechanics, on a
yearlong basis, which might not be possible without the
general funds to keep them employed. Co-Chair Hawker
understood that more state employees was a good thing. Mr.
Richards responded that the retention of existing employees
was a good thing.
Co-Chair Hawker queried functional allocation of
expenditures across all budgets. He expressed frustration
with the reining in of the operating costs of the various
agencies. He noted the growth in the department's budget in
travel and personnel costs. He asked what would happen if
the funds in those two areas were cut by 10 percent, and how
would the department implement the legislative cuts.
2:59:45 PM
Commissioner von Scheben replied that taking 10 percent off
the top would result in less travel, but that performance
would go down as well. For example, the commissioner was
based out of Anchorage, but traveled to Juneau for business.
He added that cuts to the budget would affect the core
competencies of the department.
Co-Chair Hawker asked what was done in the private sector
when there was not enough revenue to cover expenses.
Commissioner von Scheben responded that people would need to
be laid off and that would mean giving up some of the
competencies of the group. Co-Chair Hawker wondered what the
key people in the department would cut in order to save
money. Commissioner von Scheben shared that he had been
through the budget process through two administrations.
During those times cuts to the budget were constantly
considered and budget growth was never an option. He
stressed that over the last 3 years the budget had been cut
so much that the next cuts would be to the core services
provided by the department.
Co-Chair Hawker noted that the department was up $30 million
in two years. He wondered how there could have been cuts
made, and a 7 and a half increase in the budget.
Commissioner von Scheben opined that the budget request was
high due to increased wages from union negotiations. He said
that union increases were expensive. He asserted that for
the last three years he had been told by the administration
to make more cuts.
Co-Chair Hawker said that the legislature had honored the
collective bargaining settlements conducted by the
administration. He felt that at the current rate of
spending, the state would soon be in a deficit.
3:05:17 PM
Representative Austerman spoke of recent mudslides in Kodiak
due to heavy rains. It was reflected in the supplemental
budget that $500,000 of general fund dollars would offset
the cost of the clean-up. He noted that the incident had
been declared a federal emergency and wondered how many
federal dollars had had been awarded to aide in the clean-
up. He said that the district filled cracks in the highway
every three years, in the meantime the cracks filled with
water, which froze and cracked the roads. He hoped that the
district was getting enough money in the budget to deal with
the problem.
Mr. Richards replied that the $500,000 received was for the
general funded needed work. He did not have the number that
the federal government had agreed to pay for the mudslide
emergency. The Federal Emergency Management Agency (FEMA,
would pay for any work above and beyond what the department
was normally budgeted for. He added that the amount that
would be paid out was dependent on the where the impact
occurred, and the type of road involved.
Representative Austerman asked if the department could
provide documentation of the numbers so that he could ensure
his district would be paid pack for the clean-up. Mr.
Richards replied that the district would not be expected to
cover the cost of the emergency with operating funds. He
said that the cost accounting figures would be collected
internally and cover of the costs would be requested by the
department in the supplemental.
Representative Austerman argued that the mudslide emergency
cost exceeded $500,000. He wanted to know how much the
federal government was going to contribute to the emergency.
Mr. Richards said he would provide the numbers.
Ms. Baker continued to Slide 23, titled "DOT&PF Challenges":
· Uncertainty and timing of adequate funding levels
· Replacing our aging workforce as large number of
employee are approaching retirement age
· Cost of doing business continues to go up
Ms. Baker said that the fuel trigger was currently funded by
a mechanism in the operating budget and was not included in
the base funding from year-to-year.
Co-Chair Hawker stated that the fuel trigger points were
being reassessed and would be an important component of Ms.
Baker stated that 30-40 percent of the department's
workforce was primed for retirement. Bids were rumored to be
coming in lower in the area of contracts, however, core
service costs continued to rise. Ms. Baker continued to
Slide 24, which was an update on the $12.7 million that was
added on the senate side in 2009, titled "FY10 Maintenance &
Operations":
· Maintain 15,221 lane miles, 256 airports
· M&O is half of DOT&PF's GF budget
· $1.5M Facilities FY10 increment:
-$172.6 to avoid supplemental
-$1,309.7 for increased service
· $11.2M Highways & Aviation FY10 increment:
-$2,550.1 to avoid supplemental
-$8,689.1 for increased service
Ms. Baker stated that $1.5 million of the dollars went
toward facilities, and $11.2, toward aviation. Approximately
$10 million was used to increase service capacity on
existing infrastructure, and $2.7 million was used to avoid
ongoing supplemental needs. Slide 25 illustrated further how
the funds were spent:
· Central Region Highways & Aviation $4,264.4
-$1,617.6 Avoid Supplementals
-$2,646.8 Higher Level of Service
· Northern Region Highways & Aviation $5,412.1
-$554.0 Avoid Supplementals
-$4,858.1 Higher Level of Service
· Southeast Region Highways & Aviation $1,552.7
-$378.5 Avoid Supplementals
-$1,184.2 Higher Level of Service
Ms. Baker stated that the handout only represented the
highway and aviation portion, the facilities detail could be
provided upon request. She continued to Slide 30, which was
a pie chart that illustrated the funding source breakdown
for the department. She highlighted that the $54.2 million
for the Marine Highway Fund was part of the $64 million
difference in the general fund categories. The International
Airport Revenue Fund was funding the Anchorage and Fairbanks
International Airport. Slide 31 detailed the $236.2 million
of general funds. Slide 32 was a bar graph demonstration of
the FY10 capital and operating budget. Ms. Baker relayed
that the main concern in local district areas related to
highway and aviation; specifically access, safety and
transportation. Fifty percent of the resources in the
operation budget were to be used in those areas. Thirty-Five
percent of the funding was going toward the marine highway
system. Other funds were slated for administration &
support, measure standards & commercial vehicle enforcement,
design and construction, and facility maintenance and
operations.
3:13:43 PM
Representative Austerman referred to Slide 32. He understood
that $850 million was expected to be coming from the federal
government. Ms. Baker replied in the affirmative.
Ms. Baker continued to Slide 33, which was a spreadsheet of
the budget request. She detailed the increases and broke
down the budget. She explained that of the traditional
general funds, $3.1 million was for the marine highways,
which had 3 bargaining units up for a 4 percent increase,
with a $148 increase to their health insurance. Ms. Baker
said that in looking at the incremental changes, the
department had $2.8 million in traditional general fund
request, $2.2 of which was in highways and aviation. She
asserted that the budget for FY2011 was flat in theory, and
that the majority of the requests were to meet regulatory
compliance expectations. Slides 34-41 related to the
increases that relate to the $2.8 million dollar general
fund incremental.
3:20:36 PM
Ms. Baker referred to Slide 29, and noted that discharge was
an issue. Two state positions at $188,000 would handle
permit compliance and oversee the program.
Representative Fairclough queried the issuance of a private
sector contract for street sweeping. Mr. Richards replied
that there had been one contract for sweeping a portion of
the state's road assets in the municipality of Anchorage;
the contract had an end completion date in August, but was
not performance based. He added that the new multi-sector
permit that went into effect February 1, 2010 required that
all roads in Anchorage be swept twice before June 1, with
another two sweepings before first snow in the fall. He
noted that the higher sweeping sequence was mandated by EPA
and that the existing level was negotiated through
aggressive consultation.
Representative Fairclough thought the operating costs were
high. She questioned whether the state should invest in its
own equipment. Mr. Richards replied that the funds for
street sweeping would be contracted out to the private
sector with the specific performance milestones required by
the permit.
Representative Fairclough asked whether the two state
workers, along with retirement benefits would go into the
operating budget. Mr. Richards concurred. The two state
workers would be responsible to meet state requirements. In
addition to street sweeping; mapping of drainage systems,
placement of the geographical information system, and
numerous permit stipulations would need to be met.
3:24:02 PM
Representative Kelly wondered what would happen if the state
insisted on sweeping all roads without involvement from the
federal government. Mr. Richards replied that the
commissioner of the department would be put in jail and the
state would face fines of $25,000 per day for non-
compliance.
Representative Kelly thought that the state should have the
right to sweep its own streets. He wondered whether the
federal requirements bothered the department.
3:25:47 PM
Co-Chair Hawker shared Representative Kelly's frustrations.
Representative Doogan thought that street sweeping in past
years had been lacking. He expressed appreciation that the
department would change the contract so the streets would be
safer. Commissioner von Scheben acknowledged that a mistake
had been made in the writing of past specifications for the
street sweeping. The timeframe had not included staging. He
stated that the mistake had been corrected.
Vice-Chair Thomas pointed out that in the past,
Representative Doogan had wanted snow removal equipment in
the budget. The item had been added, but was expensive.
Ms. Baker continued. She shared that the department had some
satellite communications contract work to buy additional
bandwidth for marine line vessels for business purposes. The
equipment had been installed with federal dollars, and would
allow all vessels active contact with the shore. The final
request was for $500.0 thousand for the Bellingham Terminal
Facilities Lease Increase.
Co-Chair Hawker urged a frugal approach to the
implementation of telecommunication equipment on nautical
vessels.
Ms. Baker concluded the presentation. She stated that the
department would compile and distribute responses as soon as
possible.
3:31:11 PM
ADJOURNMENT
The meeting was adjourned at 3:30 PM
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