Legislature(2021 - 2022)ADAMS 519
02/03/2022 01:30 PM House FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| Presentation: Covid-19 Federal Funding Update by the Office of Management and Budget | |
| Presentation: Infrastructure Investment and Jobs Act (iija) Overview by the Office of the Governor | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HOUSE FINANCE COMMITTEE
February 3, 2022
1:34 p.m.
1:34:07 PM
Co-Chair Foster called the House Finance Committee meeting
to order at 1:34 p.m.
MEMBERS PRESENT
Representative Kelly Merrick, Co-Chair
Representative Dan Ortiz, Vice-Chair
Representative Ben Carpenter via teleconference
Representative Bryce Edgmon
Representative DeLena Johnson
Representative Andy Josephson
Representative Bart LeBon via teleconference
Representative Sara Rasmussen via teleconference
Representative Adam Wool
MEMBERS ABSENT
Representative Neal Foster, Co-Chair
Representative Steve Thompson
ALSO PRESENT
Neil Steininger, Director, Office of Management and Budget,
Office of the Governor; Paloma Harbour, Fiscal Management
Practices Analyst, Office of Management and Budget, Office
of the Governor; Miles Baker, Infrastructure Investment
Coordinator, Office of the Governor.
PRESENT VIA TELECONFERENCE
Micaela Fowler, Commerce, Community, and Economic
Development, Director of Admin Services, Juneau; Bryan
Butcher, Chief Executive Officer and Executive Director,
Alaska Housing Finance Corporation, Department of Revenue;
Sylvan Robb, Assistant Commissioner Health and Social
Services, Juneau; James Marx, Director of Statewide Program
Development: Transportation, Department of Transportation
and Public Facilities.
SUMMARY
PRESENTATION: COVID-19 FEDERAL FUNDING UPDATE BY THE OFFICE
OF MANAGEMENT AND BUDGET
PRESENTATION: INFRASTRUCTURE INVESTMENT AND JOBS ACT (IIJA)
OVERVIEW BY THE OFFICE OF THE GOVERNOR
Co-Chair Merrick reviewed the agenda for the day.
^PRESENTATION: COVID-19 FEDERAL FUNDING UPDATE BY THE
OFFICE OF MANAGEMENT AND BUDGET
1:34:59 PM
NEIL STEININGER, DIRECTOR, OFFICE OF MANAGEMENT AND BUDGET,
OFFICE OF THE GOVERNOR, introduced the PowerPoint
Presentation: "COVID-19 Federal Funding Update" (copy on
file). He relayed that he could provide additional detail
on any of the information covered in the presentation. The
pertinent items using COVID Relief funding in the FY 2023
budget was from relief money not yet appropriated. He
reminded the committee that the federal COVID relief bills
were intended for addressing emergency situations arising
from pandemic response. He countered that the federal
infrastructure bill that would be discussed later was a
standard federal programmatic bill. He noted that the COVID
relief funding was unique, and he emphasized the
distinction between the two types of federal funding.
1:36:51 PM
Co-Chair Merrick indicated that the committee had been
joined by Representative Carpenter on Teams.
PALOMA HARBOUR, FISCAL MANAGEMENT PRACTICES ANALYST, OFFICE
OF MANAGEMENT AND BUDGET, OFFICE OF THE GOVERNOR, began
with Slide 2 titled Federal Fiscal Response. She
explained that the diagram showed the 6 federal bills
passed by Congress in response to the pandemic. She listed
the bills that offered the majority of the federal funding:
Coronavirus Aid, Relief and Economic Security (CARES)
Act
Coronavirus Response and Relief Supplemental
Appropriations Act (CRRSAA)
American Rescue Plan (ARP) Act
Ms. Harbour indicated that the presentation would focus
primarily on the three bills.
Co-Chair Merrick relayed that Representative Johnson had
joined the meeting.
1:37:58 PM
Ms. Harbour moved to slide 3 titled Federal Funding to
Alaska. She related that the pie chart depicted how the
federal funding was distributed to Alaska. She reported
that $5.1 billion was distributed directly to Tribes and
tribal organizations, $2.5 billion was allocated to
businesses, $1.8 billion was distributed directly to
individuals in the form of economic impact payments. In
addition, $3 billion was enhanced funding distributed to
individuals through State Agency Programs. She furthered
that $1.8 billion was discretionary funding to the state to
address the pandemic strategically statewide.
1:38:49 PM
Ms. Harbour moved to slide 4 titled Federal Funding
through State Agencies, which provided a more detailed pie
chart on the funding distribution to state agencies. She
elaborated that of the $3 billion allocated to and
administered by state agencies, $1 billion was distributed
as federally funded Unemployment Compensation and
Assistance to individuals in addition to existing state
unemployment payments.
1:39:33 PM
Representative Edgmon asked if most of the money had been
spent. Ms. Harbour responded in the affirmative. A majority
had been spent or obligated.
Representative Wool referred to slide 3. He asked for an
exact number of the total federal relief funding to Alaska.
He deduced that it was close to $15 billion. Ms. Harbour
confirmed that the total was about $15 billion.
Ms. Harbour addressed slide 5 titled AK Housing Finance
Corporation Programs:
? AHFC is administering $363.4m in federal housing
relief and another $84.6m in funding from tribes and
cities
? 77% of the relief funding has been awarded to date
? The rent relief program has paid out $235m to over
26,000 households across the state housing 66,000 plus
Alaskans
? Program partners are beginning work on a
stabilization program for homeless Alaskans and
persons who are victims of domestic violence or human
trafficking with the remaining rent relief funds
? The mortgage relief program was recently approved by
the US Treasury and AHFC hopes to release details this
month
Co-Chair Merrick indicated Representative Rasmussen had
joined the meeting on Teams.
1:41:48 PM
Ms. Harbour moved to slide 6 titled Education & Early
Development Programs:
? DEED is administering $621.5m in federal education
relief funds
? 91% of the relief funding has been obligated to date
sending $517.5m to school districts across the state
? Last week the department released a COVID SmartSheet
dashboard with details on all the COVID Federal Relief
passed through DEED
? The different pages include: details on all 54
school districts; DEED State Education Agency
set-aside; Governors funding; and non-public schools
funding
? This is a work in progress, with the department
making modifications to present information in a
visually appealing way
1:42:30 PM
Ms. Harbour advanced to slide 7 titled Commerce
Administered Programs:
CARES Act funding
? Closing out Coronavirus Relief Fund grants with
communities
? $3m has not yet been disbursed; $1.6m related
to communities that never entered into an
agreement with the State
ARPA CSLFRF funding
? Business Relief Program awarded $45.9m to 363
businesses
? Nonprofit Relief Program awarded $10.8m to 99
nonprofits
? Second round of applicant solicitation closes
February 16th
? Electric Utility Relief Program applications in
process totaling $4.9m
? Local Government Relief Program first round
awards this month
Ms. Harbour pointed out that regarding the relief programs
administered by the Department of Commerce, Community and
Economic Development (DCCED), most were discretionary
programs, which meant the department was tasked with
creating many new programs. She indicated that the
department enlisted the help of partners such as the Alaska
Municipal League and the programs were successful.
1:43:44 PM
Representative Josephson relayed that the Cares Act passed
almost two years ago. He wondered why local relief was just
being awarded. Ms. Harbour responded that Cares Act
community relief ended in December 2021. The local
government relief funding listed at the end of the slide
was ARRPA funding that was recently awarded.
Representative Johnson asked about the $3 million in
community relief that had not been disbursed. Ms. Harbour
replied that most of the $3 million would be released to
communities closing out their grants. The undispersed $1.6
million would require an appropriation to an eligible
expense that was incurred before December 31, 2021.
Co-Chair Merrick asked what some of the reasons were for
some communities not entering into an agreement with the
state. Ms. Harbour replied that some communities could not
deal with the stipulations of the grant and the reporting
requirements.
Representative Edgmon remarked that there was a significant
amount of planning in terms of the disbursement of funding
and he commended DCCED and other departments for their good
work. He asked if there was any kind of tracking or
enforcement in place. He relayed a story of a business that
was sold immediately after receiving relief funding. Ms.
Harbour could not speak to the representative's specific
example. However, there was a cap of $100,000 on the small
business program administered by Alaska Industrial
Development and Export Authority (AIDEA). She was aware
that DCCED had placed stipulations on ARPA funding
regarding businesses that were operating or planning to
reopen. There was someone online that could provide
additional information.
1:47:46 PM
MICAELA FOWLER, COMMERCE, COMMUNITY, AND ECONOMIC
DEVELOPMENT, DIRECTOR OF ADMIN SERVICES, JUNEAU (via
teleconference), asked the representative to restate his
question, as it was very difficult to hear legislators in
the room.
1:48:05 PM
AT EASE
1:48:50 PM
RECONVENED
Representative Edgmon restated his question regarding the
grants that had been disbursed. He had heard that someone
in his district that received federal funding then sold
their business and kept the federal money. He wondered
about checks and balances.
Ms. Fowler responded that DCCED had designed the programs
to discourage receiving funding and subsequently selling or
closing the business. She added that none of the grant
programs provided grants in excess of $1 million to
individual businesses. She explained that concerning the
ARRPA funding, the department had more rigorous reporting
and monitoring requirements and had more time to implement
the program than the earlier relief funding.
Ms. Harbour continued reviewing slide 7.
1:52:14 PM
Ms. Harbour continued to slide 8 titled Transportation and
Public Facilities Programs:
? DOTPF is administering $423m in federal
transportation relief funds
? 78% of the relief funding has been appropriated to
date
? The federal funding for operation of specific
airports (as prescribed by the Feds) will take longer
to fully expend
? The Governor's Budget appropriated another $21.8m to
offset unrestricted general fund support of rural
airport operating costs
? COVID funds kept the Marine Highway System stable
through period of shutdown and provided the support
that allowed forward funding
? International Airport funds have kept fees low and
Anchorage Airport Competitive
1:52:51 PM
Representative LeBon cited the business relief program of
about $90 million. He heard that about half of the funding
had been distributed. He had received feedback in his
community regarding frustration due to the slow roll out of
the program and the lack of good timely information. He
asked when the first round would be closed, and the second
round would open. He reported that several businesses in
his community had provided negative feedback.
Ms. Harbour responded that the February 16 bullet point was
related to non-profit relief. She deferred to Ms. Fowler
from DCCED.
Ms. Fowler indicated the department had a new commissioner
designee. She acknowledged that she had heard the same
feedback from Representative LeBons community and planned
to address the issues. The department was hoping to
announce adjustments made to the program and the date of
opening the second round of funding soon. She thought it
would be within a couple of weeks. The commissioner was
hearing the same feedback and was making the issue a top
priority, as the timing was crucial to tourism related
businesses. Representative LeBon thanked Ms. Fowler for her
response.
Representative Josephson referred to slide 8. He noted that
78 percent had been appropriated. There was a plan to free
up other Unrestricted General Funds (UGF). He wondered if
the administration planned to use any of the unspent
funding for Alaska Housing Finance Corporation (AHFC) or
DEED to backfill budgets.
Mr. Steininger responded in the affirmative and added that
the regulations allowed the DOT money to be used to offset
UGF for the same purpose. The AHFC and DEED programs were
not flexible in the same way to offset UGF in existing
programs.
1:59:14 PM
Vice-Chair Ortiz had a question regarding slide 5 and
pointed to the following bullet points:
77% of the relief funding has been awarded to date
? The rent relief program has paid out $235m to over
26,000 households across the state housing 66,000 plus
Alaskans
Vice-Chair Ortiz asked if they meant that the rent relief
program continued.
Ms. Harbour responded in the affirmative. She pointed to
the third bullet point as the response:
Program partners are beginning work on a stabilization
program for homeless Alaskans and persons who are
victims of domestic violence or human trafficking with
the remaining rent relief funds
Ms. Harbour elaborated that $50 million of the mortgage
relief program was included in the 77 percent of AHFC
awarded funding. She added that as far as the rental relief
funding the administration was working with homeless and
domestic violence victims on the remaining funding. Ms.
Harbour concluded with slide 8.
2:01:25 PM
Representative Johnson returned to slide 7 regarding the
non-profit relief funding and requested a complete list.
Ms. Harbour answered that she did not list the nonprofit
ARPA funding on the slide, but the information could be
found in the hand-out Attachment 2 titled "OMB Alaska
Coronavirus" (copy on file).
2:02:18 PM
Representative Carpenter asked whether the rent relief
program covered individuals that were fired due to choosing
not to get vaccinated. Ms. Harbour deferred to AHFC for a
specific answer.
BRYAN BUTCHER, CHIEF EXECUTIVE OFFICER AND EXECUTIVE
DIRECTOR, ALASKA HOUSING FINANCE CORPORATION, DEPARTMENT OF
REVENUE (via teleconference), responded that anyone would
qualify and there was not an aspect related to
vaccinations. He offered to answer Vice-Chair Ortiz's
earlier question. He reported that $44 million was still
available in the rent relief program. He delineated that
requirements stipulated that payments were made in three
month increments. He expected April and May would be the
timeframe which people would be transitioning out of the
program.
2:05:02 PM
Ms. Harbour moved to slide 9 titled Health and Social
Services Programs and highlighted several of Department of
Health and Social Services (DHSS) programs as follows:
? DHSS has spent over $1 billion in federal funding on
COVID, including FEMA
? CDC provided over $200m for testing, vaccines, and
lab capacity
? Nearly $100m for childcare development and
stabilization grants
? Low Income Heating and Water programs totaling $19m
? Another $20m for Mental Health and Substance Abuse
Treatment
Ms. Harbour commented that the department received the
largest amount of federal relief funding. She added that
there was a laundry list of programs that DHSS
administered, and she would provide more details upon
request.
2:06:06 PM
Vice-Chair Ortiz mentioned the issue of childcare in the
state. He asked how the money was used for childcare
development. Ms. Harbour replied that the childcare
development and stabilization grants was an existing
program and had received additional funding during the
pandemic. She deferred to the department.
2:07:02 PM
SYLVAN ROBB, ASSISTANT COMMISSIONER HEALTH AND SOCIAL
SERVICES, JUNEAU (via teleconference), asked Vice-Chair
Ortiz to repeat his question.
Vice-Chair Ortiz restated his question. Ms. Robb reported
that the funds had been used in several different ways and
the funding was received in four appropriations for
specific purposes. The funding was used to award bonuses to
outstanding childcare program staff, $1 million on COVID
response for completion of childcare portals that supported
childcare programs access to resources, childcare training,
and increasing copays for families in the childcare
assistance programs.
2:08:50 PM
Ms. Harbour advanced to slide 10 titled Alaska CARES Act
Coronavirus Relief Funds, which the pie chart recapped the
Coronavirus relief funding distribution. She noted that
Attachment 2 (Handout 2 in packet) provided much more
detail. She reported that 46 percent or $568 million was
distributed in local government relief, 27 percent or $338.
5 million was awarded to business and industry relief, 7
percent or $87.6 million was allocated to nonprofit relief,
and 14 percent or $176.9 million went to state agency Covid
costs.
2:10:18 PM
Ms. Harbour moved to the table on slide 11 titled AK ARPA
Coronavirus State and Local Fiscal Recovery Funds (SLFRF),
which showed a simple table of the SLFRF funding. The
funding was released in 2 tranches, the first was received
in March 2021 and the following tranche was expected in
spring of 2022.
State - $1 billion
Fairbanks - $5.6 million
Anchorage - $ 47.4 million
Organized Boroughs - $127.2 million
Smaller Cities (Non-entitlement Units) - $43.2 million
Census Areas (Unorganized boroughs - $14.9 million
Ms. Harbour offered that not included on the slide was
tribal funding that amounted to $19 billion based on a
formula set out by the United States (U.S.) Treasury
Department that was revised with the help of the Alaska
Federation of Natives (AFN). In addition, each tribe
received $1.7 million from the U.S. Treasury.
2:13:04 PM
Vice-Chair Ortiz deduced that the funding on the slide was
different than the funding that would be distributed
through DCCED for local government relief. Ms. Harbour
responded that he was correct. She elucidated that the
funding was money the was being distributed directly
through Treasury. Vice-Chair Ortiz wondered if there was a
breakdown of funding for the organized boroughs. Ms.
Harbour offered to provide the list.
2:14:27 PM
Representative Josephson asked if the bill which allowed
the legislature to fund lost revenue due to COVID was the
ARRPA funding versus Coronavirus Aid, Relief, and Economic
Security (CARES) Act Funding, which did not allow for
revenue replacement. Ms. Harbour replied in the
affirmative. Representative Josephson asked whether the
requirements of CARES funding for local government required
the municipalities to demonstrate the need for the funding
and if it was their sole responsibility. Ms. Harbour
restated that the money was for COVID relief and not lost
revenue.
Co-Chair Merrick indicated the committee had about 15
minutes left for this portion of the presentation.
Ms. Harbour advanced to the table on slide 12 titled
Alaska ARPA Coronavirus State Fiscal Recovery Funds. She
highlighted that the total award to Alaska was $ 1 billion,
and the table portrayed the first tranche of money that
amounted to roughly half of the amount. She listed several
of the appropriations.
Ms. Harbour announced that there was $504.8 million left to
appropriate as shown on slide 13 titled FY2023 Governor's
Budget CSLFRF Appropriations. She reviewed the list on the
slide.
2:18:05 PM
Ms. Harbour continued to slide 14 titled CSLFRF Guidance
(Final Rule):
These funds can be used to cover expenses
A. to respond to the public health emergency with
respect to COVID19 or its negative economic
impacts;
B. to respond to workers performing essential
work during the COVID-19 public health emergency
by providing premium pay to eligible workers
performing such essential work;
C. for the provision of government services to
the extent of the reduction in revenue due to the
COVID-19 public health emergency; and
D. to make necessary investments in water, sewer,
or broadband infrastructure.
Restrictions include
A. direct or indirect offsets to a reduction in
net tax revenue resulting from changing law,
regulation, or administrative interpretation
during the covered period that reduces or delays
the imposition of any tax or tax increase;
B. deposits into any pension fund.
2:19:04 PM
Ms. Harbour advanced to slide 15 titled ARPA Coronavirus
Capital Project Funds which totaled $112 million. The
governors FY 23 capital budget proposed $63.9 million in
spending for three projects:
Health Record Infrastructure Improvements - $30
million (DHSS)
DOF Eagle River Fire Crew Facility - $13.9 million
(DNR)
Student Information Technology Systems - $20 million
(UA)
Ms. Harbour relayed that $49.9 million of funding was the
remainder of the balance.
2:19:54 PM
Ms. Harbour moved to the CCPF guidance on slide 16 titled
CCPF Guidance:
These funds can be used to cover Presumptively
Eligible Projects
Broadband Infrastructure Projects construction and
deployment projects that meet upload and
download standards
Digital Connectivity Technology Projects the
purchase and/or installation of devices and
equipment to facilitate broadband internet access for
members of the public where affordability has
been identified as a barrier to broadband adoption and
use;
Multi-Purpose Community Facility Projects projects
to construct or improve buildings that provide public
access to the internet for purposes including work,
education, and health monitoring
or Case-by-Case Review projects that
Invest in capital assets designed to directly enable
work, education, and health monitoring
Designed to address a critical need that results
from or was made apparent or exacerbated by
the COVID-19 public health emergency
Designed to address a critical need in the community
to be served by it
2:20:36 PM
Representative Josephson asked about the administrations
policy to spend the $504 million of operating dollars on
Coronavirus State and Local Fiscal Recovery Funds (CSLFRF)
funding in FY 23 versus the capital funding where only a
portion would be spent.
Mr. Steininger responded that of the $504 million of CSLFRF
funding some was in capital, and some was in operating. The
full amount was expended to offset UGF to be used in future
budgets. He elaborated that in the case of the ARPA
Coronavirus Capital Projects funding, the three projects
had been identified and met the criteria for the fund.
There was a deadline in September 2022 for the applications
for the remaining $47.9 million and OMB was determining
projects and how they met the eligibility criteria. The
entire $1.8 million would need to be applied for and
allocated by September 2022. He explained that it was not
so much that it was being held for the following year as
the administration was waiting for more federal guidance.
Representative Josephson asked whether the operating
dollars could be used through 2024. Mr. Steininger answered
that the deadline was December 31, 2024.
2:24:08 PM
Representative Johnson asked how much was in the tribal
CSLFRF funding. Ms. Harbour did not have the total number
and would provide the information.
2:24:40 PM
Vice-Chair Ortiz asked about applying for the ARPA capital
funds. He asked where organizations would submit their
applications for the funding. Mr. Steininger responded that
they would have to apply to the U.S. Treasury Department.
Ms. Harbour interjected that Treasury released the project
plans in early January 2022. The state would submit the
full project plan for review and approval.
Vice-Chair Ortiz asked for clarification as to how the
process worked for applying for the remaining nearly $48
million. Ms. Harbour responded that the legislature would
appropriate the funding, OMB would work with the entity on
the application, which would be submitted through the
administration as part of a state plan.
2:27:01 PM
Representative Josephson appreciated the presentation.
Representative Edgmon noted that remaining needs of the
state might require additional monies - particularly the
hospitality sector. He wondered what he could tell people
if asked. Ms. Harbour responded that the business relief
program would release a second solicitation for
applications in February 2022. She advised pointing them to
the program.
Co-Chair Merrick thanked the presenters.
2:28:11 PM
AT EASE
2:29:19 PM
RECONVENED
Co-Chair Merrick called the meeting back to order and
introduced Miles Baker.
^PRESENTATION: INFRASTRUCTURE INVESTMENT AND JOBS ACT
(IIJA) OVERVIEW BY THE OFFICE OF THE GOVERNOR
2:29:30 PM
MILES BAKER, INFRASTRUCTURE INVESTMENT COORDINATOR, OFFICE
OF THE GOVERNOR, introduced the PowerPoint Presentation:
"Infrastructure Investment & Jobs Act (IIJA) Overview"
(copy on file). He began on slide 2 (not titled) to review
preliminary observations:
Preliminary Observations:
Not a "stimulus" bill: long-term assets and core
infrastructure
Much less discretionary than recent stimulus:
CARES, CRRSA, ARP
Shovel worthy vs shovel ready
Spending directed by federal agencies, not Alaska
5-year reauthorization of established federal
programs (FHWA, Transit, Safety, AIP, VSW, IHS,
BIA)
No real "earmarks"
State/Local capital priorities largely ineligible
for funding not CAPSIS
Only a portion of "Alaska" funding will come
through the State of Alaska
Local governments, tribes and other entities
eligible for most programs
Mr. Baker stressed that currently there was much left
unknown about the specifics of the bill. He noted the
difference between the pandemic relief funding versus the
stimulus bill where program funding would be distributed
over 5 years and would operate in the typical way federal
programs worked. He highlighted the last bullet and
explained that the eligibility for most programs had been
expanded.
2:33:48 PM
Mr. Baker moved to slide 3 titled Overview:
Overview
Infrastructure Investment and Jobs Act (IIJA) also
referred to as Bipartisan Infrastructure Law (BIL)
Enacted Nov 15, 2021
~$973 billion over five years: FFY22-26 ($1.2
trillion CBO 10-yr projection)
o $423 billion baseline program reauthorizations (43%)
o Transportation (DOT/FAA) and public works (EPA)
o $550 billion above the baseline "new spending" (57%)
o Broadband, Energy & Power, Electric Vehicles,
Cybersecurity, etc.
Funds should begin arriving in 2022 and continue
for 5 fiscal years
2:34:58 PM
Mr. Baker continued to slide 4 that continued with an
overview of the IIJA bill. He pointed to the large circle
on the diagram representing the bills total of $973
billion over 5 years. The dark blue portion of the diagram
outside of the light blue representing $423 billion
baseline spending was anticipated spending via the federal
government. The entire bill was 50 percent transportation
infrastructure: Roads, bridges, airports, ports and
waterways, rail, public transit, electric vehicles (EV),
and safety programs. The remainder was comprised of Other
Infrastructure: Energy, power grid, broadband, water,
resiliency, and environmental remediation.
2:36:07 PM
Representative Wool asked about the $423 billion base
spending. He understood that the amount of $423 billion
would have already flowed into states regardless of the
bill. He deduced that it was the $550 billion that was the
heart of what was being discussed. Mr. Baker responded,
"Exactly." He elaborated that the basic federal highway
programs and water and sewer programs funding would have
been dispersed. The bill took the typical 5-year
reauthorization and expanded the bill. The bill was a mix
of old and new programs. The other key point was that even
with the new items, the bill extended over a 5-year
timeframe.
2:38:19 PM
Mr. Baker turned to slide 5 which reflected a breakdown of
new spending ($550 million) by federal agencies of which
half was the U.S. DOT:
USDOT: $274 billion
EPA: $67 billion
Energy: $63 billion
Commerce: $51 billion
Interior: $28 billion
Homeland: $8 billion
Other: $59 billion
Mr. Baker declared that there was a significant amount of
money the state would not qualify for due to the specific
nature of the program.
2:39:30 PM
Mr. Baker examined slide 6 of the IIJA overview that
showed the same spending broken down in a pie chart and
focused on the large areas of spending. He reported that
the term "Resiliency" was frequently used in the bill. He
explained that the term meant to make infrastructure more
resilient to climate change and cyber-attacks. In Alaska,
the most relevant remediation was for legacy oil and gas
wells (brown field remediation and superfund sites) and
some reclamation of abandoned mines.
Transportation: $284 billion
Energy & Power: $73 billion
Broadband: $65 billion
Water: $$55 billion
Resiliency: $44 billion
Environmental Remediation: $21 billion
Public Lands: $8 billion
2:41:01 PM
Representative Johnson asked if all of the funding was
appropriated in 5 year authorizations. Mr. Baker answered
that the federal government legislated very differently
than in the state. He delineated that Congress often
combined legislation containing statutory changes with
appropriations, which they had done in the bill. Unlike
Alaska, where direct appropriations were made, Congress
authorized the level of spending over multiple years.
Congress set an anticipated spending level for 5 years and
appropriated to the level for each year. He discussed the
nuances of the federal appropriation process. He noted that
cyber-security programs were only appropriated for four
years.
2:43:32 PM
Representative Edgmon asked if it was fair to characterize
what he was presenting to the committee was a preliminary
outline. He wondered if budget amendments might be in order
further into the session. Mr. Baker thought Representative
Edgmon's assessment was fair. He commented that the
administration wanted to get information out as soon as
possible to set expectations. He indicated that in order to
avoid confusion over the money being discussed from the
relief bills, the governor would introduce a separate
appropriation bill likely after the budget amendments were
due.
2:45:43 PM
Representative Edgmon wondered if it was fair to say the
amount of matching dollars was presently indeterminate as
well as the guidance for the programs. Mr. Baker answered
in the affirmative. He confirmed that federal guidance was
still forthcoming. He commented that generally speaking
there was a matching requirement. The bill focused on rural
communities and tribal communities and in certain
circumstances, the match was less or not required.
2:47:33 PM
Representative Edgmon asked about horizontal construction.
He thought most of the bill applied to horizontal
construction and believed it was an important distinction.
Mr. Baker responded in the affirmative. He communicated
that state and local project priorities were largely
ineligible.
2:48:33 PM
Mr. Baker continued to slide 7 titled Overview:
Availability of Funds:
Legislation includes both spending Authorizations
and Appropriations
o Authorization: the amount of funding
Congress may approve each year
o Appropriations: funding Congress has
approved to implement a program
5-year reauthorization (FFY22-26) of federal
transportation (DOT/FAA) and public works (EPA)
programs
Authorized programs still subject to annual
appropriation process FFY22-26
o Congress currently under FY21 Continuing
Resolution
o No "new starts"
Division J appropriates forward funding - $550
billion - that's theoretically available?but
o New programs will require agency guidance:
Broadband, Energy & Power, Electric Vehicles,
Cybersecurity
o Guidance may not be available before 2Qrt or
3Qrt
o Plus-ups to existing programs may still be
dependent on FY22 congressional appropriation
Additional complication: Highway Trust Fund
spending has been authorized, but is also considered
discretionary so is subject to annual change during
Congressional budget process
2:50:08 PM
Mr. Baker turned to slide 8 titled Overview: Funding Type:
Funding Type (approximates)
Formula: ~ 65%
Apportionment distribution by statutory formula
Allocation distribution by administrative
determination
Grant: ~ 30%
Discretionary awarded at discretion of program
administrators
Competitive awarded through a competitive process
Loan: ~ 5%
Many programs will require non-federal match
typically 10%-20%
2:51:19 PM
Mr. Baker turned to slide 9 titled Overview: Spending
Categories:
Over Half of New Spending is Transportation
$284 billion over 5-years National 5-Yr Totals
Roads & Bridges $110 billion
31% increase first year, inflation adjusted after;
Alaska ~20%
Rail $66 billion
Amtrak, Northeast corridor, intercity passenger; AKRR
no big benefit
Transit: $39 billion
Public transit; zero-emission vehicle programs
Airports: $25 billion
35% nationally; AIP and New Terminal Facility program
mostly competitive
Ports & Waterways: $17 billion
USACE rivers, harbors, flood mitigation; MARAD port
infrastructure grants
Safety: $11 billion
Focus on vulnerable users (bikes, pedestrians, ADA),
crash and fatality avoidance
Electric Vehicle Infrastructure $8 billion
New formula and grant program
Electric Buses: $8 billion
Mr. Baker emphasized that there was not much money for the
state for ports and waterways in IIJA.
2:53:26 PM
Representative Josephson cited slide 8 and pointed to the
typical 10 percent to 20 percent match, which was high for
any entity other than the state. He thought there had been
a misunderstanding that the IIJA allowed state legislators
to participate in the programs in a meaningful way. He
surmised legislators' role would be more observatory. He
ascertained that the state would be the matching entity and
inquired whether legislators would play any participatory
role regarding projects. Mr. Baker answered that it was the
reason the term non-federal had been used because many
entities were eligible for the funds including local
governments, tribal entities, or Railbelt utilities. He
discussed some ideas regarding matching funds and how it
might work and noted that in some instances the state might
contribute the matching funds for an entity.
2:56:50 PM
Representative Edgmon referenced a federal project under
the federal highway formula program that was broadened to
include Rural Barge and Dock and Waterfront Infrastructure.
He wanted more detail. Mr. Baker would provide the answer
later.
2:57:35 PM
Mr. Baker moved to slide 10 titled Overview: Spending
Categories: which highlighted other infrastructure
spending:
Other Infrastructure Spending
$266 billion over 5-years National 5-Yr Totals
Energy & Power $73 billion
Efficiency, grid & transmission upgrades/resiliency,
carbon mitigation projects
Broadband $65 billion
$45b construction, $20b affordability/equity; targets
underserved areas
Water: $55 billion
3x increase to revolving loan funds; lead pipe;
contaminants
Resiliency: $44 billion
Storm/flood mitigation, natural disaster assistance;
cybersecurity
Environmental Remediation: $21 billion
Legacy wells; superfund sites; brownfield; abandoned
mines; watersheds
Public Lands $8 billion
Wildfire risk mitigation; remediation; secure rule
schools; USFS roads
2:58:53 PM
Representative Edgmon deemed that the broadband spending
was the non-tribal monies. Mr. Baker replied that the
tribal money was included in the $65 billion figure.
2:59:32 PM
Mr. Baker presented slides 11 and 12 both titled
Preliminary List of State Budget Items that tentatively
showed the areas that most likely might need appropriation
authority:
Federal-Aid Highways:
DOT FHWA National Highway Performance Program
(NHPP)
DOT FHWA Surface Transportation Block Grant
Program (STBG)
DOT FHWA Highway Safety Improvement Program
(HSIP)
DOT FHWA Railway-Highway Grade Crossings Program
DOT FHWA Congestion Mitigation and Air Quality
(CMAQ) Improvement Program
DOT FHWA National Highway Freight Program (NHFP)
DOT FHWA Metropolitan Planning Program (MPO)
DOT FHWA NEW: Carbon Reduction Program
DOT FHWA NEW: PROTECT Formula Program
Bridge:
DOT FHWA NEW: Bridge Formula Program
Ferry:
DOT FTA NEW: Ferry Service for Rural Communities
(Sec 71103)
Airports
DOT FAA Airport Improvement Program
Mr. Baker noted that federal highways had published its
allocations for the first year of its programs. He pointed
to the new items in red representing new programs.
Representative LeBon asked about the request for Alaska
ports. He wondered if some of the infrastructure monies
could be used for the Port of Anchorage. Mr. Baker
responded in the negative. He did not think the monies
could not be used for the ports. He explained that the bulk
of the money for ports and waterways was for the Corps of
Engineers for very specific statutorily mandated work. The
Maritime Administration (MARAD) had a port improvement
grant program that had received $2.25 billion, $450 million
over 5 years nationwide that was a competitive program. The
port of Anchorage had received $20 million from the program
3 years prior. He discussed other grant funding for ports.
However, the grants were relatively small. The grants were
typically between $5 million and $25 million. He reported
that he could not identify any obvious funding for the
port.
3:06:20 PM
Mr. Baker advanced to slide 12 continuing the discussion
regarding budget appropriations:
Broadband
CED NTIA NEW: BEAD (Broadband Equity, Access,
and Deployment) Program - Initial Planning Grant
Water Infrastructure
DEC EPA Clean Water State Revolving Funds
(CWSRF): Program
DEC EPA NEW: CWSRF - Emerging Contaminants
(PFAS)
DEC EPA Drinking Water State Revolving Funds
(DWSRF): Program
DEC EPA DWSRF Lead Service Line Projects
DEC EPA DWSRF Emerging Contaminants (PFAS)
DEC EPA Brownfield Projects Under CERCLA of
1980
DEC IHS Domestic and Community Sanitation
Facilities for Indians - DEC Admin
Cybersecurity
MVA DHS NEW: State and Local Cybersecurity
Grant Program
Energy and Resources
AEA FHWA NEW: National Electric Vehicle Formula
Program (Div J)
AEA DOE State Energy Program (Sec 40109)
AEA DOE New: Energy Auditor Training Grant (Sec
40503)
AEA DOE New: Energy Efficiency Revolving Loan
Fund Capitalization Grant Program (Sec 40502
HHS HHS Low-Income Heating Assistance Program
(LIHEAP)
DNR DOI NEW: Earth Mapping Resources Initiative
(MRI) (Sec 40201)
DNR DOI Abandoned Mine Lands Reclamation
Methane Reduction Infrastructure
DOI AOGCC NEW: Orpha ned Well Site
Plugging/Remediation: State Land Program
Schools
CED USFS Secure Rural Schools Program
Reauthorization (Sec 41202)
Mr. Baker elaborated that in terms of broadband, the state
might receive an initial planning grant. There was a
significant amount of planning that would be necessary to
determine the difference between the formula and grant
funding.
3:07:43 PM
Representative Johnson cited the Earth Mapping Resources
Initiative. Mr. Baker responded that he could touch on the
item which was a new program for the United States
Geological Survey (USGS) to map critical minerals. The
administration believed the state would receive monies
through the new initiative.
Mr. Baker continued to slide 13 titled National Federal
Highway Program Funding, which depicted the National
Federal Highway Program Funding on a bar chart. He
reiterated that the state had been informed of the amount
of funding it would receive. The funding increased
substantially in the first year and rose about 2 percent
each of the following years.
3:10:52 PM
Mr. Baker pointed to slide 14 that continued to breakdown
the federal highway funding. The amount equaled $108
million in the first year divided among the different
highway programs. He noted that the most flexible program
was the Surface Transportation Block Grant program listed
second on the table that increased about $22 million per
year over 5 years. The surface transportation block program
was substantially amended and included rural barge landings
and seasonal ice roads.
3:13:57 PM
Representative Edgmon appreciate the explanation that some
money would be available for a 5-year period. He suggested
holding another meeting for additional detail. He wondered
how much of the money would be applicable to non-roads and
bridges. He deemed that there would be a nominal amount of
money for Coastal Alaska waterway projects from IIJA. He
asked for confirmation. Mr. Baker deferred to DOT to
further answer the question.
3:16:24 PM
JAMES MARX, DIRECTOR OF STATEWIDE PROGRAM DEVELOPMENT:
TRANSPORTATION, DEPARTMENT OF TRANSPORTATION AND PUBLIC
FACILITIES (via teleconference), provided additional
detail. He listed the state programs the Surface
Transportation Block Grant (STBG) program typically
covered. He cautioned that the funding was presented in
gross numbers, and much was still unknown. The block grant
program federal administrators typically made carve outs
and set asides before it provided the funding and in some
set asides the funding increased. Once the appropriations
act was released, he would have concrete numbers. He agreed
with the idea of a follow-up hearing.
Representative Edgmon appreciated the answer. He understood
that the information was preliminary and was very
interested in learning more. He presumed that the in spite
of the hype about the bill, the numbers might not be that
overwhelming.
Co-Chair Merrick echoed Representative Edgmon's comments.
She thought the information Mr. Baker provided created some
broken hearts and was underwhelming.
3:19:44 PM
Mr. Baker reviewed slide 15 titled Alaska Rural
Water/Sanitation Funding that represented the amount
appropriated for Alaska in total:
Alaska will see increased spending on rural water and
sewer through
Indian Health Service Domestic and Community
Sanitation - $3.5 billion (over 5 years)
EPA Tribal and increased grants to State Revolving
Loan Programs
Mr. Baker remarked that a bright spot was that a
significant portion of the $3.5 billion would flow into
Alaska represented by the blue bar on the chart. The
funding was potentially the largest amount besides
broadband. The funding was an attempt to solve the problems
of sanitation in rural Alaska.
3:21:56 PM
Mr. Baker moved to slide 16 titled Infrastructure Bill
Impact on GO Bond Project:
Federal infrastructure bill does not negate the need
for state GO Bond
State funding allows more flexibility on project
execution
Federally eligible projects still require non-
federal match: 10%-35%
State match accelerates project timing and helps
incentivize federal prioritization
Mr. Baker discussed how the infrastructure bill would
impact the GO Bond Project. He voiced that state funding
allowed the state more flexibility on project execution.
He pointed to the recently announced U.S. Army Corps of
Engineering projects requiring non-federal match shown on
the slide that included the Port of Nome Phase 1 project
financed through IIJA at $250 million ($333 million total)
but required a match of $83 million by the state plus $64
million of local facilities that were required to be non-
federally funded. The amount represented 147 percent non-
federal match. Only 7 percent of the match was represented
in the GO Bond bill.
3:23:25 PM
Mr. Baker addressed Slide 17 titled Other Important Alaska
Provisions:
AK Natural Gas Pipeline project definition for
loan guarantees (Sec 40401)
Removed the limitation to a project that
transported gas to the West Coast/Continental US
for US Treasury loan guarantees
$18 billion adjusted for CPI since Oct 2004
should now be ~ $25 billion
One Federal Decision (FAST-41 Permitting) (Sec
11301)
Local Hiring Preference for Construction Jobs
(Sec 25019)
Ends prohibitions on local hiring and allows
recipients of federal transportation grants to
implement a local hiring preference
3 Year Reauthorization of Secure Rural Schools
Program (Sec 41202)
Mr. Baker quickly reviewed slides 18-19 of the presentation
that were titled Programs of Interest to Alaska that
represented 5 year totals. He highlighted Slide 20:
Energy & Power:
$34.0 bill Carbon Capture, Sequestration, Clean
Hydrogen
$5.0 bill Electric Grid Financial Assistance
Program
$3.5 bill Weatherization Assistance Program
$3.2 bill Advanced Reactor Demonstration
Project
$2.5 bill Grid Resilience & Reliability
grants
$1.0 bill Electric Grid Financial Assistance
in Rural & Remote Areas
$750 mill Hydroelectric Production & Efficiency
Incentive Programs
$550 mill Energy Efficiency & Conservation Block
Grants
$320 mill Earth Mapping Resources Initiative
$50 mill Transmission Facilitation Program
Mr. Baker highlighted Slide 19:
Federal Land:
$11.3 bill Abandoned Mine Reclamation
$3.4 bill Wildfire Mitigation & Fuel Breaks
$718 mill Wildfire Risk Reduction & Ecosystem
Restoration (USFS)
$250 mill Legacy Road & Trail Remediation Program
(USFS)
$200 mill Restoring Fish & Wildlife Stream
Passage (USFW)
$88 mill State Fire Assistance (USFS)
$20 mill Volunteer Fire Assistance (USFS)
3:26:53 PM
Mr. Baker turned to Slide 20 titled Summary:
Congressional Priorities
Equity, resiliency, safety, climate mitigation,
energy efficiency, deployment of technology and
emphasis on multimodal projects
Statewide communication and coordination required
Alaska should be well positioned to be competitive:
Tribal and Alaska Natives eligibility
Historically underserved and hard-to-reach
Multimodal transportation dependency
High energy costs & microgrids
Rural and disadvantaged communities
Climate mitigation
Fossil fuel industries
Minority and low-income populations
Vice-Chair Ortiz cited the Electric Vehicle (EV)
Infrastructure. He wondered what the goal of the state was.
Mr. Baker replied that there were two programs (formula and
grant programs) for expanding the infrastructure for
alternative fuel charged vehicles. He noted that the Alaska
Energy Authority (AEA) was the lead on the project. He
relayed that the state would be qualified for $50 million.
3:30:16 PM
Representative Edgmon mentioned Mr. Baker's remarks on
expectation setting. He shared that expectations were
building in his district. He asked for a ball-park figure
of the amount of discretionary funding the state would
receive. He asked if a figure was in the range of $100
million to $200 million. Mr. Baker would hesitate to put a
range on the figure but guessed that Representative
Edgmon's number was close but was uncertain of the answer.
Representative Edgmon asked about other buckets of money
available. Mr. Baker did not see a significant amount of
discretionary funding. Representative Edgmon was eager to
walk away from the meeting with information that he could
provide to constituents. He asked for Mr. Steininger's
comments.
3:34:24 PM
Mr. Steininger could not offer much more than Mr. Baker
information. He stated that the level of knowledge the
administration had was incomplete and Mr. Baker expressed
what was currently known.
Representative Wool offered that the pandemic relief monies
received by Alaska totaled roughly $15 billion. He asked
how much of the $100 billion per year would go to Alaska.
Mr. Baker returned to slide 11. He noted that IIJA included
a new statutory program for rural ferry service and was
$200 million per year over 5 years. The entire $1 billion
was appropriated in the bill. He expected that Congress
would continue to fund the program after year 5. The state
would receive 65 percent of the $200 million per year, $135
million per year would come to Alaska. He emphasized that
the amount coming to the state was due to the tremendous
work of the congressional delegation. The administration
was trying to take the large federal number and discern the
amount the state would receive, and it was a huge task.
Co-Chair Merrick thanked the presenters and reviewed the
agenda for the following day.
ADJOURNMENT
3:40:10 PM
The meeting was adjourned at 3:40 p.m.
| Document Name | Date/Time | Subjects |
|---|---|---|
| OMB - HFIN Attachment 1 - AHFC DEED and DOTPF COVID Relief 2.3.2022.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| OMB - HFIN Attachment 2 - CARES CRF Spending 2.3.2022.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| 2022 02 03 IIJA OMB Overview HFIN Final.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| FINAL FIN OMB COVID Funding Update 2.3.22 - corrected slide 4.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| Attachment 1 - Nonprofit Grant First Round Recipients.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| OMB Response to 02.03.22 HFIN COVID Questions.pdf |
HFIN 2/3/2022 1:30:00 PM |
|
| Attachment 2 - ARPA CSLFRF by Alaska Recipient.pdf |
HFIN 2/3/2022 1:30:00 PM |