Legislature(2025 - 2026)ADAMS 519

01/26/2026 01:30 PM House FINANCE

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01:33:51 PM Start
01:39:39 PM Presentation: Fy 26 Vetoes by the Office of Management and Budget
03:22:47 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ Presentation: FY26 Vetoes by Office of Management TELECONFERENCED
and Budget
                  HOUSE FINANCE COMMITTEE                                                                                       
                     January 26, 2026                                                                                           
                         1:33 p.m.                                                                                              
                                                                                                                                
                                                                                                                                
1:33:51 PM                                                                                                                    
                                                                                                                                
CALL TO ORDER                                                                                                                 
                                                                                                                                
Co-Chair  Josephson  called   the  House  Finance  Committee                                                                    
meeting to order at 1:33 p.m.                                                                                                   
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Neal Foster, Co-Chair                                                                                            
Representative Andy Josephson, Co-Chair                                                                                         
Representative Calvin Schrage, Co-Chair                                                                                         
Representative Jamie Allard                                                                                                     
Representative Jeremy Bynum                                                                                                     
Representative Alyse Galvin                                                                                                     
Representative Sara Hannan                                                                                                      
Representative Elexie Moore                                                                                                     
Representative Will Stapp                                                                                                       
Representative Frank Tomaszewski                                                                                                
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Nellie Unangiq Jimmie                                                                                            
                                                                                                                                
ALSO PRESENT                                                                                                                  
                                                                                                                                
Lacey Sanders,  Director, Office  of Management  and Budget,                                                                    
Office   of  the   Governor;  Dom   Pannone,  Administrative                                                                    
Services Director,  Department of Transportation  and Public                                                                    
Facilities;  Ryan  Anderson,   Commissioner,  Department  of                                                                    
Transportation and Public Facilities.                                                                                           
                                                                                                                                
PRESENT VIA TELECONFERENCE                                                                                                    
                                                                                                                                
Marie   Marx,   Legislative   Counsel,   Legislative   Legal                                                                    
Services.                                                                                                                       
                                                                                                                                
SUMMARY                                                                                                                       
                                                                                                                                
PRESENTATION: FY 26  VETOES BY THE OFFICE  OF MANAGEMENT AND                                                                    
BUDGET                                                                                                                          
                                                                                                                                
Co-Chair Josephson reviewed the meeting agenda.                                                                                 
                                                                                                                                
^PRESENTATION: FY 26 VETOES BY  THE OFFICE OF MANAGEMENT AND                                                                  
BUDGET                                                                                                                        
                                                                                                                                
LACEY SANDERS,  DIRECTOR, OFFICE  OF MANAGEMENT  AND BUDGET,                                                                    
OFFICE OF THE GOVERNOR,  provided opening remarks related to                                                                    
the  governor's vetoes  in the  FY 26  budget. She  detailed                                                                    
that the budget passed by the  legislature at the end of the                                                                    
previous session  was built  on a  much higher  dollar value                                                                    
based  on   the  [Department  of  Revenue]   spring  revenue                                                                    
forecast released in  March that included an  [oil price] of                                                                    
$68.00 per barrel.  She elaborated that in  June, the Office                                                                    
of Management and  Budget (OMB) had worked  closely with the                                                                    
Department of  Revenue (DOR)  in monitoring  the significant                                                                    
decline and volatility in the price  of oil. By the time the                                                                    
governor was  addressing the bills  through the  veto review                                                                    
process and signing  them into law, DOR  provided an updated                                                                    
oil  price  projection  of  $64  per  barrel,  reflecting  a                                                                    
decrease  of  almost  $4.00  per  barrel.  The  DOR  website                                                                    
included  a letter  from the  former commissioner  outlining                                                                    
the status at the time  and providing several scenarios such                                                                    
as a  $5 increase and $5  decrease to give people  a general                                                                    
idea where the  remainder of the year would  be. She relayed                                                                    
that  the governor  had taken  the  situation seriously  and                                                                    
wanted  to  ensure  the  state  was not  in  a  position  of                                                                    
substantial  deficits;  therefore,  he had  proposed  vetoes                                                                    
totaling almost  $122 million in  the operating  and capital                                                                    
budgets.                                                                                                                        
                                                                                                                                
Ms.  Sanders  referenced   three  spreadsheets  in  members'                                                                    
packets (copy on  file) that had been  released the previous                                                                    
June when  the [budget] was  signed into law. The  first was                                                                    
the OMB HB  53 veto summary spreadsheet,  a one-page summary                                                                    
encompassing  the  vetoes   associated  with  the  operating                                                                    
budget. She was available for questions on the document.                                                                        
                                                                                                                                
Co-Chair Josephson asked if members  had questions about the                                                                    
operating budget vetoes. He asked  for verification that the                                                                    
operating   budget   vetoes   totaled   $57.5   million   in                                                                    
unrestricted general funds (UGF).                                                                                               
                                                                                                                                
Ms. Sanders responded affirmatively.                                                                                            
                                                                                                                                
Co-Chair Josephson  asked how  much was  coming back  to the                                                                    
legislature as supplemental requests.                                                                                           
                                                                                                                                
1:39:39 PM                                                                                                                    
                                                                                                                                
Ms.  Sanders  highlighted  two  supplemental  items  on  the                                                                    
spreadsheet   that  were   included  in   governor's  budget                                                                    
released on  December 11. The  first was  the capitalization                                                                    
of the  Disaster Relief Fund on  row 24. The veto  was about                                                                    
$10.3 million  and retained $13  million. She  detailed that                                                                    
OMB  worked with  the Department  of  Military and  Veterans                                                                    
Affairs  (DMVA) during  the review  and  disasters had  been                                                                    
costing the  state approximately  $1 million per  month. The                                                                    
governor's  budget  included  a  $40  million  request.  She                                                                    
highlighted that  Typhoon Halong  was a substantial  cost to                                                                    
the state. The  second pertained to a  veto of approximately                                                                    
$26 million for fire suppression  shown on line 27. The veto                                                                    
retained $47.5 million in the  budget for fire response. The                                                                    
governor's   budget  included   two  notifications   to  the                                                                    
legislature  to  address  fire  totaling  $55  million.  She                                                                    
explained  that  it   was  not  the  full   number  and  the                                                                    
administration  would be  talking to  the legislature  about                                                                    
future   requests  to   address  the   remainder  of   costs                                                                    
associated with  the Fire  Suppression Fund.  Similarly with                                                                    
the Disaster  Relief Fund, the  costs were not  all incurred                                                                    
in  one year.  Some of  the costs  associated with  the Fire                                                                    
Suppression  Fund  were related  to  shoring  up prior  year                                                                    
processes.                                                                                                                      
                                                                                                                                
1:42:26 PM                                                                                                                    
                                                                                                                                
Representative   Galvin   observed  that   the   spreadsheet                                                                    
included several vetoes in education.  She recalled that the                                                                    
governor   had  requested   some  of   the  items   and  the                                                                    
legislature had  been careful not  to add funding  above the                                                                    
requests. She  referenced line  1 labeled  "highest priority                                                                    
teacher  recruitment: mentorship,  apprenticeship?" She  had                                                                    
heard  repeatedly   that  the  item  was   a  top  priority.                                                                    
Additionally, a bill  was passed by the  33rd legislature to                                                                    
give   teacher  incentive   payments   for  national   board                                                                    
certification and  it was  zeroed out  by the  governor. She                                                                    
highlighted that  the statute had  passed, but it  had never                                                                    
been funded. She  was concerned about the  $500,000 cut that                                                                    
she noted  would not make or  break the bank. She  asked for                                                                    
an explanation.                                                                                                                 
                                                                                                                                
Ms. Sanders responded that OMB  took the veto review process                                                                    
very  seriously.  The  items  had been  zeroed  out  due  to                                                                    
declining revenue.                                                                                                              
                                                                                                                                
Representative Galvin had heard  that with other vetoes ways                                                                    
had been  found to ensure  services were kept whole  one way                                                                    
or  another.  She wondered  if  the  same thought  had  been                                                                    
applied  to  the  two specific  aforementioned  vetoes.  She                                                                    
asked if positions had been  moved to ensure there was money                                                                    
in order to follow the statute that was passed.                                                                                 
                                                                                                                                
Ms. Sanders replied not to her knowledge.                                                                                       
                                                                                                                                
Representative Hannan  referred to the Disaster  Relief Fund                                                                    
including   the  $40   million   supplemental  request   and                                                                    
remaining fund  balance of $13  million after the  veto. She                                                                    
asked if  she could presume  the cost for disasters  for the                                                                    
fiscal year was $53 million.                                                                                                    
                                                                                                                                
Ms.  Sanders  answered  that  the funds  were  not  for  the                                                                    
specific   year.  She   explained  that   disasters  covered                                                                    
multiple  years  and  OMB  worked  closely  with  DMVA.  She                                                                    
confirmed  that  $53  million was  the  total  appropriation                                                                    
amount.                                                                                                                         
                                                                                                                                
Representative  Hannan  asked  what  the  governor's  FY  27                                                                    
budget requested for the Disaster Relief Fund.                                                                                  
                                                                                                                                
Ms.  Sanders answered  that the  governor's budget  included                                                                    
$24  million for  FY 27,  which  was based  on the  ten-year                                                                    
average.  She highlighted  the difference  between the  ten-                                                                    
year and five-year average. She  explained that the ten-year                                                                    
average included  the 2018 earthquake  and both  more recent                                                                    
typhoons. She  remarked that it  was one way to  address the                                                                    
number. She  was open  to conversations  about "what  is the                                                                    
correct approach."                                                                                                              
                                                                                                                                
1:46:53 PM                                                                                                                    
                                                                                                                                
Representative Hannan  asked if  there was a  higher average                                                                    
when including the earthquake of  2018 than there was when a                                                                    
five-year window was used the past session.                                                                                     
                                                                                                                                
Ms. Sanders  answered that the  five-year and  ten-year were                                                                    
similar, but she would follow up with more detail.                                                                              
                                                                                                                                
Representative Bynum  asked about five-year  averages versus                                                                    
ten-year  averages, specifically  related  to disasters.  He                                                                    
asked if  other factors were considered.  For example, there                                                                    
were  models   the  state   could  reference   to  determine                                                                    
projections  for  a  year  in terms  of  what  forest  fire,                                                                    
wildfire, or hurricane  relief would look like.  He asked if                                                                    
those  factors  were  being  considered.  Alternatively,  he                                                                    
wondered if  OMB only looked  at a five-year average  and if                                                                    
costs  ended  up  exceeding   the  appropriated  amount,  an                                                                    
additional request  was made in the  supplemental budget, or                                                                    
if the appropriation was too much, it would be vetoed.                                                                          
                                                                                                                                
Ms. Sanders responded that specific  to fire, the Department                                                                    
of  Natural  Resources (DNR)  had  a  very experienced  team                                                                    
looking at the  data about what a fire  year was anticipated                                                                    
to look  like based on historical  information. The proposed                                                                    
FY 27 budget  used the same amount from the  prior year. She                                                                    
explained  that  the  fund was  being  capitalized  and  the                                                                    
funding was not lapsing on  an annual basis. She stated that                                                                    
based  on the  amount needed  from year  to year,  the state                                                                    
should  strive toward  some kind  of average  funding amount                                                                    
that would  cover multiple years  that may include  high and                                                                    
lower  cost years.  She  noted  that the  fund  was new  and                                                                    
hopefully  the  trend  line  would  start  stabilizing  with                                                                    
deposits to cover the high and low years.                                                                                       
                                                                                                                                
Representative  Bynum asked  if  the  department was  taking                                                                    
information from department experts into consideration.                                                                         
                                                                                                                                
Ms.  Sanders replied  affirmatively.  She had  met with  the                                                                    
department on that type of information.                                                                                         
                                                                                                                                
1:50:08 PM                                                                                                                    
                                                                                                                                
Co-Chair  Josephson  looked  at   the  repeal  of  statehood                                                                    
defense funds from  previous years on line 19.  He looked at                                                                    
the associated note on the  same line and thought it sounded                                                                    
similar to the  debate over the Juneau Access  Road that the                                                                    
dollars were  obligated. He stated  it could be a  murky set                                                                    
of  facts  in  other   instances  and  perhaps  the  current                                                                    
instance   could   be   disputed.   He   asked   about   the                                                                    
administration's  position on  the legislature's  efforts to                                                                    
claw back  undisputed, unobligated, unspent funds.  He asked                                                                    
for  the  administration's  position   on  the  legality  of                                                                    
striking  dollars  in  a circumstance  where  there  was  no                                                                    
dispute they were not spent.                                                                                                    
                                                                                                                                
Ms.  Sanders  replied  that  she  is  not  an  attorney  and                                                                    
deferred any  legal inquiries or analysis  to the Department                                                                    
of Law  (DOL). She referenced  a memorandum provided  by Co-                                                                    
Chair  Josephson in  members'  packets addressing  questions                                                                    
regarding  repeals and  the governor's  veto  of those  line                                                                    
items  [memorandum  from  Marie Marx,  Legislative  Counsel,                                                                    
Legislative Legal  Services, dated  June 24, 2025]  (copy on                                                                    
file). She shared  the memo with DOL and  the department was                                                                    
currently  reviewing it.  From OMB's  perspective, the  line                                                                    
item veto was appropriate in  the current case. She deferred                                                                    
and further comments or remarks to DOL.                                                                                         
                                                                                                                                
Co-Chair Josephson did not recall  whether he had routed the                                                                    
opinion memo through OMB the  previous summer. He considered                                                                    
a scenario where the legislature  tried to claw back what it                                                                    
deemed to be  unspent dollars and spent them  in an entirely                                                                    
different area. He  asked if the governor  could strike that                                                                    
item because it  would be a new purpose. He  wondered if the                                                                    
governor was allowed  to strike the item because  it was the                                                                    
same  dollars. He  thought it  was apropos  of "part  of the                                                                    
reason  we're  here  on  the  Department  of  Transportation                                                                    
issue."                                                                                                                         
                                                                                                                                
1:53:29 PM                                                                                                                    
                                                                                                                                
Representative Hannan  looked at  item 10,  a $1  veto under                                                                    
DOR. She noted  the item was a structure in  the budget with                                                                    
directive  language to  decommission the  [Anchorage] office                                                                    
the  Alaska Permanent  Fund Corporation  (APFC) created  the                                                                    
previous year without legislative  funding or structure. She                                                                    
asked what  structure remained for  the funding of  a second                                                                    
APFC office  that had  never received  legislative authority                                                                    
or appropriation.                                                                                                               
                                                                                                                                
Ms. Sanders  replied that it  was the  administration's view                                                                    
that   management  and   administration  of   functions  and                                                                    
programs  within  agencies  was  at the  discretion  of  the                                                                    
administration.  She relayed  that staff  continued to  work                                                                    
out   of   the   Anchorage    office.   The   prior   year's                                                                    
appropriations spent from one  appropriation as was the case                                                                    
in the current year.                                                                                                            
                                                                                                                                
Representative  Hannan  asked   for  verification  that  the                                                                    
office  in Anchorage  was not  located in  the state  office                                                                    
building  and was  located  in a  separate  facility with  a                                                                    
separate lease.                                                                                                                 
                                                                                                                                
Ms. Sanders  apologized that she  did not know  the physical                                                                    
location. She  relayed that it was  co-located previously in                                                                    
the  Department of  Environmental Conservation  (DEC) space,                                                                    
but she  did not know  if it was  still the case.  She would                                                                    
follow up with the information.                                                                                                 
                                                                                                                                
Co-Chair  Josephson noted  that  Legislative Legal  Services                                                                    
was available online if needed.                                                                                                 
                                                                                                                                
Representative Galvin observed that nine  of the 29 lines in                                                                    
the  spreadsheet  were  directly  related  to  education  or                                                                    
childcare. She emphasized that one-third  of the vetoes were                                                                    
taking  away  services  for  children.   She  asked  if  the                                                                    
administration had determined education  had been taken care                                                                    
of  [in  other ways];  therefore,  it  had decided  to  take                                                                    
funding from the  areas [identified in the  vetoes]. She was                                                                    
looking to understand the reason  behind the vetoes directly                                                                    
impacting children.                                                                                                             
                                                                                                                                
1:57:07 PM                                                                                                                    
                                                                                                                                
Ms. Sanders  responded that she  did not have  anything else                                                                    
to add.                                                                                                                         
                                                                                                                                
Representative  Stapp  asked  when  the  administration  had                                                                    
encumbered  funding that  was  later  reappropriated by  the                                                                    
legislature. He  understood there  was a  time delay  on the                                                                    
CASR [Capital  Appropriation Status Report]. He  stated that                                                                    
the  report came  out in  November and  typically money  was                                                                    
encumbered  quickly to  get  construction  projects out  the                                                                    
door.                                                                                                                           
                                                                                                                                
Ms. Sanders answered that OMB  had an intensive process that                                                                    
departments   underwent   to    go   through   the   Capital                                                                    
Appropriation  Status Report  (CASR). She  explained that  a                                                                    
date  was  selected when  OMB  pulled  information from  the                                                                    
state's accounting  system reflecting  a point in  time. The                                                                    
departments  worked  through  their process  to  go  through                                                                    
project by project to provide  updates, followed by a review                                                                    
by  OMB, with  a public  report  due to  the legislature  in                                                                    
January.  There was  a significant  time delay  between when                                                                    
OMB pulled  information from  the state's  accounting system                                                                    
and reporting it to the  legislature. She elaborated that by                                                                    
the  time the  legislature  worked on  its  versions of  the                                                                    
capital  and   operating  budgets  in  March   to  May,  the                                                                    
information was up to six  months old. She thought there was                                                                    
an  opportunity to  work with  the legislature  to get  more                                                                    
detailed information  or updates. She did  not believe state                                                                    
agencies  had the  capacity  to go  through  an entire  CASR                                                                    
review  because  it  took  a  significant  amount  of  time,                                                                    
especially   for    agencies   like   the    Department   of                                                                    
Transportation   and  Public   Facilities   (DOT)  and   the                                                                    
Department of  Commerce, Community and  Economic Development                                                                    
(DCCED). Ensuring  there was  more accurate  information for                                                                    
the legislature  to make decisions  was something  the state                                                                    
could work towards to prevent  a situation where departments                                                                    
were continuing  to work  on projects  where funds  had been                                                                    
obligated  through  legal  contracts  between  November  and                                                                    
March/April.                                                                                                                    
                                                                                                                                
Representative  Stapp thought  it was  fairly understandable                                                                    
they would  operate on  a time delay.  He stressed  that the                                                                    
CASR was  a huge report. He  asked if anyone reached  out to                                                                    
OMB  to  ensure  a  contract  had  not  been  signed  before                                                                    
reappropriating the money.                                                                                                      
                                                                                                                                
Ms. Sanders responded  that she had not  been contacted with                                                                    
any updated information, but it  did not mean there were not                                                                    
many conversations  occurring. She hoped they  could get the                                                                    
most  updated  information  in   a  formal  process  to  the                                                                    
legislature to ensure everyone was on the same page.                                                                            
                                                                                                                                
2:01:11 PM                                                                                                                    
                                                                                                                                
Representative Stapp  thought it  seemed weird not  to reach                                                                    
out  to  the OMB  director.  He  understood that  "obviously                                                                    
you're not going to always  have all of the information." He                                                                    
hoped in  the future  that legislators would  remember there                                                                    
were  many  moving  pieces in  the  administration  and  the                                                                    
legislature  did  not   want  to  be  in   the  business  of                                                                    
micromanaging  the  departments.  He hoped  the  legislature                                                                    
would  contact the  administration  in the  future when  the                                                                    
circumstance arose.                                                                                                             
                                                                                                                                
Representative  Tomaszewski referenced  the memorandum  from                                                                    
Legislative Legal Services attorney  Marie Marx addressed to                                                                    
Co-Chair Josephson  dated June 24,  2025 (copy on  file). He                                                                    
had  not previously  seen  the memo  and  asked if  Co-Chair                                                                    
Josephson  had solicited  a response  from  the governor  or                                                                    
attorney general.                                                                                                               
                                                                                                                                
Co-Chair  Josephson replied,  "No." He  elaborated that  the                                                                    
memo raised some  key separation of powers  issues. He noted                                                                    
that the  committees that would normally  take up separation                                                                    
of powers  issues were Legislative  Budget and  Audit (LB&A)                                                                    
and Legislative Council.  He sat on LB&A, but  no motion had                                                                    
been  made yet  relative to  the issue.  He stated  that the                                                                    
vetoes had been  made at the time the memo  was prepared. He                                                                    
explained that  sharing the memo with  the administration at                                                                    
the time  would not have  led the administration  to reverse                                                                    
the vetoes; therefore,  he had not shared the  memo with the                                                                    
administration.                                                                                                                 
                                                                                                                                
Representative  Bynum  remarked that  he  had  not seen  the                                                                    
memorandum  previously. He  asked to  hear from  Legislative                                                                    
Legal Services about what the  question actually was and how                                                                    
it was important to  the current conversation. Additionally,                                                                    
he  was  interested  in  hearing  DOL's  opinion  about  the                                                                    
subject in layman's terms.                                                                                                      
                                                                                                                                
2:04:08 PM                                                                                                                    
                                                                                                                                
MARIE MARX, LEGISLATIVE  COUNSEL, LEGISLATIVE LEGAL SERVICES                                                                    
(via  teleconference),  stated   her  understanding  of  the                                                                    
question. She  believed Representative Bynum was  asking for                                                                    
an explanation of the memorandum in plain language.                                                                             
                                                                                                                                
Co-Chair Josephson agreed.                                                                                                      
                                                                                                                                
Ms.  Marx explained  that  the question  the  memo aimed  to                                                                    
answer was whether the  governor's constitutional veto power                                                                    
included  the  ability  to  strike  language  that  did  not                                                                    
appropriate a sum  of money, such as  striking language that                                                                    
repealed  previously  enacted  appropriations.  She  relayed                                                                    
that  the  topic had  not  been  directly addressed  by  the                                                                    
Alaska Supreme  Court. However, in  a 2001 case  that talked                                                                    
about  what   an  appropriation   item  was  and   what  the                                                                    
governor's  veto power  encompassed,  the  court ruled  that                                                                    
reducing  meant  lessening  an  amount  and  striking  meant                                                                    
lessening an item  to nothing. She thought there  was a real                                                                    
issue about what  power the governor had  to strike language                                                                    
repealing an  appropriation. She  explained that  striking a                                                                    
repeal  meant  raising  the   amount  of  the  appropriation                                                                    
instead of lessening the appropriation.                                                                                         
                                                                                                                                
Co-Chair Josephson asked about  a scenario where monies were                                                                    
repealed or there was an  attempted claw back based on facts                                                                    
known by  the legislature  that the  funds were  unspent and                                                                    
held.   He   asked   if  the   governor   could   veto   the                                                                    
reappropriated  dollars from  the  repeal. He  asked if  the                                                                    
governor  could  strike  the new  expenditure  but  not  the                                                                    
Session  Law  of Alaska  (SLA)  language  from the  previous                                                                    
year.                                                                                                                           
                                                                                                                                
Ms.  Marx answered  that the  scenario provided  by Co-Chair                                                                    
Josephson was  an interesting  nuance and  was not  what had                                                                    
occurred under the current  circumstance. She explained that                                                                    
if  the legislature  made a  new  appropriation using  money                                                                    
that  was unspent,  the  governor would  have  the power  to                                                                    
reduce  the amount  or strike  the  entire appropriation  as                                                                    
long as the  quantitative effect was to  diminish the amount                                                                    
appropriated. The  court ruled  in the Knowles  case [Alaska                                                                    
Legislative  Council v.  Knowles, 2001]  that the  power the                                                                    
governor had  was to diminish  the amount  appropriated. She                                                                    
believed the  governor had the constitutional  power to veto                                                                    
an appropriation item as long as that occurred.                                                                                 
                                                                                                                                
2:07:38 PM                                                                                                                    
                                                                                                                                
Representative    Hannan    stated    that    the    largest                                                                    
reappropriated money  was DOT  money from  previous projects                                                                    
to  be  used  as  federal  matching  funds.  She  noted  the                                                                    
reappropriation had been  vetoed. She asked if  DOT had been                                                                    
asked  to  provide information  on  whether  the funds  were                                                                    
fully expended or obligated.                                                                                                    
                                                                                                                                
DOM  PANNONE, ADMINISTRATIVE  SERVICES DIRECTOR,  DEPARTMENT                                                                    
OF TRANSPORTATION  AND PUBLIC  FACILITIES, replied  that the                                                                    
Legislative  Finance  Division  (LFD) and  some  legislative                                                                    
staff reached  out for new  balances in the CASR  related to                                                                    
some  of  the  reappropriations   and  matching  funds.  The                                                                    
department provided  updated balances and a  letter advising                                                                    
that match  balances were needed for  August redistribution.                                                                    
He   explained   that   the  balances   had   already   been                                                                    
incorporated into the project delivery  plan and the age did                                                                    
not negate the need for  a new additional match requested by                                                                    
DOT.  He   did  not   recall  a  conversation   about  other                                                                    
reappropriations of  projects used  in DOT's match,  such as                                                                    
Cascade Point  [in Juneau] and  a project in the  Mat-Su. He                                                                    
added that some  of the other reappropriations  were not DOT                                                                    
appropriations and he could not speak to them.                                                                                  
                                                                                                                                
Representative  Hannan asked  if  the  other body's  capital                                                                    
[budget] chair's office reached out  to ask for accurate up-                                                                    
to-date  data before  the reappropriation  of DOT  money for                                                                    
what was Juneau  Access money at the time before  it was put                                                                    
in the capital budget as a reappropriation.                                                                                     
                                                                                                                                
Mr. Pannone  responded that  he was not  aware of  a request                                                                    
from either body. He noted  that there was a slide dedicated                                                                    
to  the Juneau  Access project  [also known  as the  Cascade                                                                    
Point project].                                                                                                                 
                                                                                                                                
2:10:33 PM                                                                                                                    
                                                                                                                                
Co-Chair Schrage  asked when the  Cascade Point  project was                                                                    
encumbered. He asked if it  was after the legislative budget                                                                    
came out.                                                                                                                       
                                                                                                                                
Mr. Pannone  looked at slide  6 pertaining to  Cascade Point                                                                    
in   a  PowerPoint   presentation   titled  "House   Finance                                                                    
Committee:   Department   of   Transportation   and   Public                                                                    
Facilities,"  dated January  26,  2026 (copy  on file).  The                                                                    
slide showed  the project timeline beginning  in April 2021.                                                                    
He explained  that the slide  showed the $4.5  million spent                                                                    
to  date  on  design   prior  to  the  reappropriations.  He                                                                    
highlighted the  engineering and feasibility and  35 percent                                                                    
design build. He  elaborated that DOT was in  the process of                                                                    
going   to   contract   out   the    work   prior   to   the                                                                    
reappropriations.  He did  not  have  the specific  contract                                                                    
date on hand, but it was  prior to the effective date of the                                                                    
bill and  any action taken on  the bill. He deferred  to the                                                                    
commissioner for additional comment.                                                                                            
                                                                                                                                
RYAN  ANDERSON, COMMISSIONER,  DEPARTMENT OF  TRANSPORTATION                                                                    
AND  PUBLIC  FACILITIES,  referenced  slide  6  showing  the                                                                    
Cascade  Point   timeline.  He  relayed  that   the  project                                                                    
delivery process involved  making numerous commitments ahead                                                                    
of  time. He  explained  that a  significant investment  had                                                                    
been made by  the time the department  awarded contracts. He                                                                    
highlighted  that $4.5  million  had been  spent on  Cascade                                                                    
Point to date.                                                                                                                  
                                                                                                                                
2:12:52 PM                                                                                                                    
                                                                                                                                
Representative Hannan asked why DOT  did not request to have                                                                    
the  money  previously  appropriated to  the  Juneau  Access                                                                    
project  reappropriated to  Cascade Point.  She remarked  it                                                                    
would  have avoided  confusion for  the legislature  to know                                                                    
the money was being spent.  She stated her understanding the                                                                    
legislature asked repeatedly how  much money remained in the                                                                    
fund  and there  was  no updated  money.  She observed  that                                                                    
DOT's  timeline  showed  the money  was  obligated  and  she                                                                    
wondered why the legislature was  not asked to reappropriate                                                                    
the  funds in  order to  have accurate  information to  work                                                                    
from.                                                                                                                           
                                                                                                                                
Commissioner  Anderson responded  that he  was not  aware of                                                                    
being asked for the balances  for Cascade Point prior to the                                                                    
reappropriation.  The  department  had always  gone  forward                                                                    
with   the    understanding   that   the   scope    of   the                                                                    
reappropriations was a fit for the Cascade Point project.                                                                       
                                                                                                                                
Co-Chair  Schrage asked  how the  administration interpreted                                                                    
the legislative  intent if the funds  were reappropriated to                                                                    
meet federal match.                                                                                                             
                                                                                                                                
Ms.  Sanders answered  that she  did  not want  to speak  on                                                                    
behalf of the legislature.  She explained that the narrative                                                                    
behind  the  reappropriation  was  to  utilize  balances  of                                                                    
projects  to meet  the [federal]  match. The  administration                                                                    
did not want to put the  state in a position where the match                                                                    
was  not available  because  the funds  the  funds had  been                                                                    
obligated  or  were no  longer  available  because they  had                                                                    
already  been  spent.  She  explained   it  would  create  a                                                                    
situation  where  the  state  could  not  meet  its  federal                                                                    
obligations;  therefore, the  action taken  was to  veto the                                                                    
appropriations  and  come back  to  the  legislature with  a                                                                    
request  for unrestricted  general funds  (UGF) to  meet the                                                                    
obligation.                                                                                                                     
                                                                                                                                
2:15:46 PM                                                                                                                    
                                                                                                                                
Co-Chair  Schrage believed  the  legislature  made it  clear                                                                    
that  it felt  that  meeting  federal match  was  more of  a                                                                    
priority than  putting up  the funds  for the  Cascade Point                                                                    
project. He would not speak  to the administration's intent,                                                                    
but  it appeared  the effect  was  to not  meet the  federal                                                                    
match,  go  back to  the  legislature  to find  a  different                                                                    
funding  source,  and to  move  forward  with Cascade  Point                                                                    
anyway. As the appropriating  branch of government, he found                                                                    
it very problematic and difficult  to find trust through the                                                                    
appropriating  process. He  stressed the  need to  work more                                                                    
closely  in  the  next  year   to  ensure  there  was  clear                                                                    
communication [between  the administration  and legislature]                                                                    
while   navigating   the   process.  He   followed   up   on                                                                    
Representative Stapp's line of  questioning and relayed that                                                                    
there was communication with the  departments on many of the                                                                    
reappropriations. He  stated it was necessary  to figure out                                                                    
a way to get clearer information from the administration.                                                                       
                                                                                                                                
2:17:25 PM                                                                                                                    
                                                                                                                                
Representative Stapp asked what  happened when the state had                                                                    
a contract  and it pulled the  money. He asked if  the state                                                                    
was  legally  obligated to  the  contract.  He considered  a                                                                    
scenario where the  state put a project out  to bid, awarded                                                                    
the contract, and took the money to spend elsewhere.                                                                            
                                                                                                                                
Commissioner Anderson answered that it  would be a breach of                                                                    
contract.  He thought  it would  set  a dangerous  precedent                                                                    
across  the contracting  community  to be  unsure the  money                                                                    
would  be   there  when  the  state   signed  a  contractual                                                                    
obligation.  The department  worked hard  to make  sure that                                                                    
the  contracts were  solid and  that  the state  had a  good                                                                    
reputation.                                                                                                                     
                                                                                                                                
Representative  Stapp asked  if  the  contracts had  clauses                                                                    
specifying  the  state  had  to  pay  once  locked  into  an                                                                    
agreement.   He   questioned   whether   the   state   could                                                                    
arbitrarily  break  contracts.  He  thought  people  in  the                                                                    
industry would  not like  it if  the state  started breaking                                                                    
contracts "willy  nilly." He asked  if there  were penalties                                                                    
for breaking contracts.                                                                                                         
                                                                                                                                
Commissioner Anderson  considered scenarios where  there was                                                                    
intent to award  a contract. He emphasized that  there was a                                                                    
great contracting  community in Alaska and  contractors took                                                                    
a lot of  risk ahead of time when securing  materials due to                                                                    
long lead times  and mobilizing equipment. He  stated it was                                                                    
tough in Alaska and there was  a fair amount of money on the                                                                    
line. The last  thing the department wanted was  to pull the                                                                    
rug  out from  under a  contractor. He  relayed that  once a                                                                    
contract was  signed, the  state had  a legal  obligation to                                                                    
the payments.                                                                                                                   
                                                                                                                                
Co-Chair  Josephson responded  it was  the reason  the House                                                                    
Finance  Committee filed  a supplemental  bill. He  remarked                                                                    
that the point was important.                                                                                                   
                                                                                                                                
2:19:56 PM                                                                                                                    
                                                                                                                                
Representative  Stapp   stated  his   biggest  fear   was  a                                                                    
situation where the  state was in the  behavioral process of                                                                    
putting out RFPs  and pulling them after awarding  a bid. He                                                                    
believed  it would  undermine the  faith  of the  contractor                                                                    
industry in Alaska.  He separately had a  question about the                                                                    
Fairbanks armory that caught fire  a couple of days back. He                                                                    
noted  the  building  was  on the  veto  list  for  upgraded                                                                    
maintenance.  He  relayed  there  had  been  money  for  the                                                                    
modernization for  the barracks. He hoped  the modernization                                                                    
had not occurred prior to the fire.                                                                                             
                                                                                                                                
Ms. Sanders answered  that the fire had been  brought to her                                                                    
attention  earlier in  the afternoon.  She expected  that as                                                                    
with  most fires  that occurred  in  state facilities  there                                                                    
would be  a process of  ensuring that insurance  covered the                                                                    
cost associated  with the fire. The  modernization component                                                                    
did not move forward due to  the veto. She offered to follow                                                                    
up with additional information.                                                                                                 
                                                                                                                                
Representative Stapp thought there was  a bright side to the                                                                    
veto  because   rather  than  spending  the   money  on  the                                                                    
modernization, the  building caught fire before  the funding                                                                    
was spent.                                                                                                                      
                                                                                                                                
Representative Allard appreciated the  work DOT did in Eagle                                                                    
River. She stated that her  sidewalks were cleared and there                                                                    
were no  ruts on the  road. She stated that  the legislature                                                                    
reappropriated funds  the previous session and  pulled funds                                                                    
from  projects that  were underway.  She  voted against  the                                                                    
action  taken.  She  asked if  it  impacted  the  governor's                                                                    
choice  to stop  the  reappropriation of  the  funds with  a                                                                    
veto.                                                                                                                           
                                                                                                                                
Commissioner Anderson  confirmed that after  the legislative                                                                    
action, DOT had  numerous questions about the  status of the                                                                    
projects and  how it  would work.  He agreed  it had  been a                                                                    
concern.                                                                                                                        
                                                                                                                                
Representative Allard remarked  that there were consequences                                                                    
when  the legislature  took  certain  actions. She  believed                                                                    
Commissioner    Anderson   was    indicating   there    were                                                                    
consequences to the actions of reappropriating the funds.                                                                       
                                                                                                                                
Commissioner Anderson agreed.                                                                                                   
                                                                                                                                
2:23:18 PM                                                                                                                    
                                                                                                                                
Co-Chair Schrage referenced  the commissioner's remark about                                                                    
long lead  times necessary  for contractors  to gear  up for                                                                    
the season.  He believed lead times  were likely substantial                                                                    
even  for  urban  projects.  He  wondered  how  much  notice                                                                    
contractors needed ahead  of time for projects  going to bid                                                                    
for a coming summer in Western Alaska.                                                                                          
                                                                                                                                
Commissioner Anderson  answered that it varied  depending on                                                                    
the   type  of   work.  For   example,  projects   involving                                                                    
transportation of  steel products that had  to be fabricated                                                                    
had their  own timeframe. He highlighted  the rural aviation                                                                    
program  for  Western Alaska  and  explained  that when  DOT                                                                    
received  grants and  went to  bid  in the  August/September                                                                    
timeframe, it took all winter  and sometimes the next summer                                                                    
to get mobilized for the following fall.                                                                                        
                                                                                                                                
Representative Bynum highlighted  that there was substantial                                                                    
discussion about  the readiness of the  contractor workforce                                                                    
to do construction for Alaska  and provide quality projects.                                                                    
He remarked  that in the  past several years there  had been                                                                    
substantial volatility in the  funding available for capital                                                                    
projects.  He  asked  Commissioner Anderson  to  talk  about                                                                    
situations where  there was volatility in  available funding                                                                    
and  the legislature  was only  trying to  meet the  minimum                                                                    
match  versus the  scope of  need  and how  it impacted  the                                                                    
quality and availability of contractors in the state.                                                                           
                                                                                                                                
Commissioner  Anderson  answered  that he  recalled  talking                                                                    
about the  issue the previous  year. There had  been concern                                                                    
from the House Finance  Committee about DOT getting projects                                                                    
on  the street.  The  department really  pushed  to get  the                                                                    
projects on the street, and  it had a record distribution of                                                                    
$183.5  million  in August.  The  department  had a  capital                                                                    
program year  that exceeded $1  billion by  leveraging every                                                                    
tool  available  including  capital and  federal  funds.  He                                                                    
stated the contractors in Alaska  were pretty phenomenal and                                                                    
tended  to work  in different  areas of  expertise in  rural                                                                    
areas such as  Western Alaska and the Dalton  Highway and in                                                                    
urban  areas.  He  stated  the  importance  of  keeping  the                                                                    
constant workloads to enable contractors  to keep work going                                                                    
in different  areas. The department  was working on  the new                                                                    
Statewide Transportation  Improvement Program  (STIP), which                                                                    
would be a  topic coming up in the near  future. He remarked                                                                    
on the  importance of maintaining  the balance of  work when                                                                    
looking at how the federal funds were allocated.                                                                                
                                                                                                                                
2:26:58 PM                                                                                                                    
                                                                                                                                
Co-Chair   Josephson  asked   if   the  contracts   reminded                                                                    
recipients  that  they  were subject  to  appropriation.  He                                                                    
understood there  was an appropriation in  the context under                                                                    
discussion. He assumed the contracts included the language.                                                                     
                                                                                                                                
Commissioner Anderson  answered that he would  follow up. He                                                                    
stated  there was  specific contract  language  in terms  of                                                                    
reasons   for  default   and  termination.   He  noted   the                                                                    
department used very standard contract language.                                                                                
                                                                                                                                
Representative Hannan  looked at the Fairbanks  barracks and                                                                    
asked where Camp Carol and Camp Denali were located.                                                                            
                                                                                                                                
Ms. Sanders  replied that  both were  located on  Joint Base                                                                    
Elmendorf-Richardson (JBER).                                                                                                    
                                                                                                                                
Representative Hannan noted that one  of the vetoes was $2.5                                                                    
million  in  highway  maintenance   on  the  Dalton  Highway                                                                    
between mileposts  76 and 89.  She asked if  any maintenance                                                                    
was done on that stretch of  highway. She did not believe it                                                                    
was the "big  slough," which she thought was at  mile 150 or                                                                    
170.  She assumed  there was  a specific  project need.  She                                                                    
wondered  if the  maintenance was  done with  other revenues                                                                    
since the money was vetoed.                                                                                                     
                                                                                                                                
Commissioner Anderson replied that mile  70 was north of the                                                                    
Yukon  River bridge  on the  Dalton Highway.  The department                                                                    
had done  a lot of  work up in  the area and  was leveraging                                                                    
preventative maintenance  funding on the Dalton  Highway. He                                                                    
relayed  that the  federal highway  agency was  working with                                                                    
DOT related to the Alaska gasline  and DOT may be able to do                                                                    
an aggregate stockpiling program  along the entire length of                                                                    
the  Dalton Highway  to ensure  it was  ready for  what came                                                                    
next. The department had annual  work on the majority of the                                                                    
highway. He  would follow up  with information on  work done                                                                    
between the specific mileposts the past summer.                                                                                 
                                                                                                                                
Representative  Hannan had  driven the  Dalton Highway  in a                                                                    
commercial rig the past summer.  She shared that the ongoing                                                                    
frustration of  the driver was  that the pile of  gravel had                                                                    
been sitting  in the  same spot for  five weeks.  The driver                                                                    
wondered  why  the  gravel  was   not  being  used  to  fill                                                                    
potholes.  She relayed  that the  driver thought  the gravel                                                                    
would  sink into  the tundra  if it  was not  spread on  the                                                                    
road.  She  added that  the  driver  joked about  personally                                                                    
spreading the  gravel if  DOT did not  do it.  She clarified                                                                    
she was not advocating for that.                                                                                                
                                                                                                                                
2:30:33 PM                                                                                                                    
                                                                                                                                
Representative  Bynum  understood  there  would  be  another                                                                    
opportunity to  have a long  conversation about  the budget,                                                                    
DOT's needs,  and some  of his  concern over  how investment                                                                    
was being  made in  the state  through capital  spending. He                                                                    
believed  the  maintenance  portion  of  infrastructure  was                                                                    
overlooked  frequently,  which  could  extend  the  life  of                                                                    
projects and  create continuity between  projects. He  had a                                                                    
lot of  concern about the  issue and believed the  state was                                                                    
underfunding capital  projects. He referenced a  question by                                                                    
the  co-chair that  he thought  made it  sound like  DOT was                                                                    
issuing  contracts without  an  appropriation  in place.  He                                                                    
asked if that was taking  place. He understood the state did                                                                    
intent  for   projects  to  gear  up,   which  were  pending                                                                    
appropriation,  and   contracts  were   put  out   once  the                                                                    
appropriation  was  secured.  He  asked if  it  was  general                                                                    
practice for the  department to enter a  contract without an                                                                    
appropriation in place.                                                                                                         
                                                                                                                                
Commissioner Anderson  responded that the funds  were always                                                                    
in place and backed by  an appropriation before DOT issued a                                                                    
contract. The  funds were encumbered  so there was  no other                                                                    
competition for the money.                                                                                                      
                                                                                                                                
Representative Bynum considered  that perhaps an opportunity                                                                    
where  the  state  would  not  continue  a  contract  was  a                                                                    
situation  where a  contract had  multiple phases  that were                                                                    
pending appropriation.  For example, DOT may  put a contract                                                                    
out for  phase 1  work with  the option  to extend  or award                                                                    
pending future appropriations.                                                                                                  
                                                                                                                                
Commissioner  Anderson replied  with  an  example where  the                                                                    
Federal  Aviation  Administration  issued staged  grants  in                                                                    
Western Alaska.  He elaborated that one  year the department                                                                    
would receive  a grant for a  certain scope of work  and the                                                                    
department  received assurance  from the  federal government                                                                    
that  it would  provide  funding for  the  second phase  the                                                                    
following  year.  The  department structured  the  contracts                                                                    
with a way out if for some reason they did not work out.                                                                        
                                                                                                                                
2:33:20 PM                                                                                                                    
                                                                                                                                
Representative Stapp  viewed the Dalton Highway  as the most                                                                    
important  transportation  corridor  in  Alaska  because  it                                                                    
represented  the heartbeat  of Alaska's  industry. He  asked                                                                    
for the commissioner's perspective.                                                                                             
                                                                                                                                
Commissioner Anderson  shared that he  had also been  up the                                                                    
Dalton Highway in  a 10,000 gallon fuel  tanker. He remarked                                                                    
that it was  a challenging environment and  the distance was                                                                    
500 miles from  Fairbanks to Prudhoe Bay. He  noted that the                                                                    
last 30  to 40 miles  into Prudhoe  Bay was likely  the most                                                                    
beautiful  paved road  around.  He elaborated  that it  took                                                                    
over $100 million  to get there. He detailed  that the state                                                                    
had invested over  $500 million in the Dalton  over the past                                                                    
ten years. He relayed that  the department was planning $500                                                                    
million for the  STIP over the next ten  years. He explained                                                                    
that it was a limited  resource and the department continued                                                                    
investing on the capital side.  He noted that the department                                                                    
would  love to  have state  funds and  years back  there had                                                                    
been  some substantial  state  appropriations. He  expounded                                                                    
that  DOT  had done  some  amazing  work  up on  the  Dalton                                                                    
Highway because  it was possible  to move much  quicker with                                                                    
the  state   funds  to  get  heavy   maintenance  done.  The                                                                    
department  was  trying to  work  with  the Federal  Highway                                                                    
Administration to  see if it  could get more  flexibility to                                                                    
do  more  of  that  work.  The  challenge  was  the  limited                                                                    
resource the  department was balancing across  the state. He                                                                    
agreed that the Dalton Highway was important for the state.                                                                     
                                                                                                                                
Representative  Stapp acknowledged  the importance  of every                                                                    
transportation  system in  the  state. He  had a  particular                                                                    
love for the  Dalton Highway as a resident  of the Interior.                                                                    
He  stated   that  the  department's   stance  was   on  the                                                                    
consistency of  fund sources. He  observed that some  of the                                                                    
vetoes were  things the  legislature decided  to appropriate                                                                    
with general funds  as opposed to funding  through some type                                                                    
of reappropriation  mechanism. For example, he  pointed to a                                                                    
veto  that  occurred  because the  fund  source  was  Alaska                                                                    
Industrial  Development and  Export Authority  (AIDEA) funds                                                                    
that were  reappropriated for something  as critical  as the                                                                    
Dalton Highway as  opposed to UGF for  something like window                                                                    
replacements  at Mt.  Edgecumbe High  School. He  directed a                                                                    
question to Ms.  Sanders and asked whether  general funds or                                                                    
reappropriations  through a  state-owned  enterprise were  a                                                                    
more consistent fund source.                                                                                                    
                                                                                                                                
Ms. Sanders replied  that it was a hard  question to answer.                                                                    
She  relayed  that  as  the  state's  fiscal  situation  had                                                                    
continued  to decline,  she frequently  asked whether  there                                                                    
were  projects  on  the  CASR   that  could  potentially  be                                                                    
reappropriated  for another  purpose.  She  stated that  the                                                                    
items  should be  evaluated; there  were many  items on  the                                                                    
list and old  items on the list, but it  was important to be                                                                    
thoughtful  about  what  "we're   saying"  is  no  longer  a                                                                    
priority in  the state  and what should  be a  priority. She                                                                    
did   not    believe   there    was   any    opposition   to                                                                    
reappropriations, but  it was necessary to  ensure there was                                                                    
revenue  behind  a  reappropriation   prior  to  putting  it                                                                    
forward.  She elaborated  that OMB  did  not want  to put  a                                                                    
reappropriation forward that had  zero dollars because there                                                                    
would be no revenue to use  toward a new item. The last time                                                                    
she looked  at the funding  sources list there  were between                                                                    
350   and  400   fund  codes.   Some  of   the  funds   were                                                                    
constitutionally   required   and  some   were   statutorily                                                                    
designated because the  legislature determined something was                                                                    
an important use.  She thought it was  important to evaluate                                                                    
items on  a case by  case basis.  For example, she  had seen                                                                    
appropriations  made from  the  Higher Education  Investment                                                                    
Fund  for  purposes that  were  outside  of the  statutorily                                                                    
designated program. She recognized  that perhaps there was a                                                                    
good  reason [to  use the  funding on  something else]  in a                                                                    
given year  to meet some  purpose. She  did not want  to say                                                                    
there  was  a  right  or  wrong,  but  she  thought  it  was                                                                    
important  to  evaluate  each  appropriation  to  ensure  it                                                                    
prioritized need. She was not  saying the Dalton Highway was                                                                    
unimportant.  The administration  recognized the  importance                                                                    
of the  particular items.  The administration  determined it                                                                    
did  not want  to use  AIDEA reserves  for purposes  outside                                                                    
what had been statutorily designated.                                                                                           
                                                                                                                                
Representative   Stapp  understood.   He   thought  it   was                                                                    
interesting    that   the    legislature   chose    to   use                                                                    
reappropriation  funds for  something  as  important as  the                                                                    
Dalton Highway. He  looked at line 17 of  the spreadsheet as                                                                    
an example  showing $1.3  million in  general funds  for the                                                                    
National  Historic Preservation  Fund. He  thought it  would                                                                    
have  made sense  for  the legislature  to  fund the  Dalton                                                                    
Highway work  with general funds  due to its  importance and                                                                    
fund the  preservation fund  with reappropriation  funds. He                                                                    
noted  it was  the  purpose behind  his  question about  the                                                                    
reliability of fund sources.                                                                                                    
                                                                                                                                
Representative  Moore lauded  the  department  for its  work                                                                    
during  a  robust  construction season  in  the  Mat-Su  the                                                                    
previous  summer. She  remarked  that Alaska's  construction                                                                    
season was  limited in  scope and  fragile. She  asked about                                                                    
the impact of  the funds being vetoed and  the importance of                                                                    
capturing the funds again.                                                                                                      
                                                                                                                                
Commissioner  Anderson  believed   everyone  recognized  the                                                                    
value of  Alaska's construction season. He  relayed that the                                                                    
department  had  secured  over  $1.3  billion  for  projects                                                                    
across  the state  including  Mat-Su, Fairbanks,  Anchorage,                                                                    
the  Parks   Highway,  Sterling  Highway,   Dalton  Highway,                                                                    
etcetera.  He  remarked that  driving  the  highways in  the                                                                    
construction  season was  a bummer  due to  delays, but  the                                                                    
projects kept  the state's infrastructure in  good condition                                                                    
and kept  the contracting community healthy.  He stated that                                                                    
Alaska had  a lot  to be proud  of with  its infrastructure,                                                                    
highway,  and airport  systems.  The state  met  all of  its                                                                    
pavement  and  bridge   federal  performance  measures.  The                                                                    
department  had  a  good  team   of  in-house  and  contract                                                                    
engineers working on  the bridges and making  sure they were                                                                    
in  good condition.  There were  times  when DOT  recognized                                                                    
challenges and  it could  move quickly  to make  repairs. He                                                                    
relayed that some  projects took five to seven  years to get                                                                    
through  the   process,  and  it  was   important  to  avoid                                                                    
disrupting the funding flow. He  explained that when funding                                                                    
started changing, engineers stopped  work, and began working                                                                    
on something else,  which resulted in lost  time, money, and                                                                    
opportunity to improve  state infrastructure. He highlighted                                                                    
the importance of stability in  order to get projects across                                                                    
the finish line and keep Alaska moving.                                                                                         
                                                                                                                                
Representative  Moore   asked  about   the  administration's                                                                    
fiscal rationale for vetoing the funds.                                                                                         
                                                                                                                                
2:43:02 PM                                                                                                                    
                                                                                                                                
Ms. Sanders  replied that the  conversation around  the STIP                                                                    
had to  do with whether  the funds were obligated  and there                                                                    
was  something in  place where  reappropriating funds  meant                                                                    
the  money  was  no  longer  available.  The  administration                                                                    
decided  to  deny the  reappropriation  of  funds for  other                                                                    
projects and to  ask for the general funds  directly to meet                                                                    
the state  match in  order for projects  to continue  and to                                                                    
allow more projects to move forward.                                                                                            
                                                                                                                                
Representative Moore stated it was unfortunate.                                                                                 
                                                                                                                                
Representative Hannan relayed that  the truck driver she had                                                                    
ridden with had asked why DOT  kept paving the last 30 miles                                                                    
of   the   Dalton   Highway   instead   of   graveling   and                                                                    
blacktopping. The driver noted  that the pavement would last                                                                    
two or three years due to the conditions in the Arctic.                                                                         
                                                                                                                                
Commissioner  Anderson replied  that the  pavement had  been                                                                    
put  in place  after the  road had  washed out  in 2015.  He                                                                    
noted the pavement had been  in place for eight years, which                                                                    
was pretty  good. He stated  that typically  Arctic pavement                                                                    
lasted 15 years  and could last 20. He  explained that there                                                                    
were a lot  of maintenance savings in  the operating budget.                                                                    
He  highlighted  there was  a  lot  of  dust on  the  Dalton                                                                    
Highway in the  summer. He elaborated that  the road surface                                                                    
could lose  anywhere from one  quarter to three  quarters of                                                                    
an inch  annually. The  paved surface  reduced the  piles of                                                                    
gravel  needed  for surfacing  and  saved  a lot  of  funds.                                                                    
Additionally,   the  department   had  minimal   staff  with                                                                    
maintenance  camps  every  30  to 40  miles  on  the  Dalton                                                                    
Highway. When sections  were paved it enabled  staff to work                                                                    
on more challenging gravel sections  that DOT did not always                                                                    
get to.  The department would  pave more if it  could. There                                                                    
were some areas where it  would cost hundreds of millions of                                                                    
dollars to  make areas  stable to  pave due  to the  need to                                                                    
raise  embankments  and  insulate.   He  did  not  have  the                                                                    
statistics on hand  but he believed about 40  percent of the                                                                    
Dalton Highway was paved. There was  a big push in the early                                                                    
2000s when  he started  at DOT to  pave the  entire highway,                                                                    
but  it only  got so  far. The  department was  not actively                                                                    
looking  to  pave the  entire  highway.  He noted  that  DOT                                                                    
listened to the truckers; there  were areas it would like to                                                                    
do more.                                                                                                                        
                                                                                                                                
2:46:54 PM                                                                                                                    
                                                                                                                                
Co-Chair Schrage  referenced the discussion about  long lead                                                                    
times  for  the  construction  industry  and  the  certainty                                                                    
needed to  plan for  a construction  season. He  stated that                                                                    
actions  by  the administration  over  the  past summer  had                                                                    
given  certainty  to  the  Cascade  Point  project  to  some                                                                    
degree. He highlighted that  the action jeopardized hundreds                                                                    
of millions  of dollars in  federal match necessary  for the                                                                    
upcoming  construction season.  He  asked  when the  general                                                                    
funds needed  to be put  forward to provide  contractors the                                                                    
certainty they  needed to  plan for the  work in  a fiscally                                                                    
responsible   manner  given   the   long   lead  times   for                                                                    
construction combined  with the uncertainty  surrounding the                                                                    
upcoming construction season.                                                                                                   
                                                                                                                                
Commissioner  Anderson  when  the  situation  occurred,  DOT                                                                    
identified that it had over  $30 million in match funds from                                                                    
the  prior year.  He pointed  to slide  5 of  the PowerPoint                                                                    
showing the Surface Transportation  Program match timing and                                                                    
federal deadlines. He relayed there  was a plan in Amendment                                                                    
2 to the  STIP that went out to public  notice that included                                                                    
the amount  DOT thought  it would have  for the  full match.                                                                    
The  department had  not finalized  the  amendment when  the                                                                    
reappropriations   followed   by   the   governor's   vetoes                                                                    
occurred. When  the department finalized Amendment  2 it had                                                                    
to reflect  the amount  of available match,  which reflected                                                                    
DOT's plan for the year.  The department had the bigger plan                                                                    
with the additional  match, but when looking  at the project                                                                    
delivery  schedules there  was  about $800  million to  $850                                                                    
million  in   projects  and  authorizations   for  programs,                                                                    
utilities, and many different  elements of project delivery.                                                                    
The department  had the match to  get through July 1  with a                                                                    
healthy construction  season. After  July 1,  the department                                                                    
would  be missing  out on  additional funds.  The department                                                                    
was  not slowing  down and  as projects  came available  the                                                                    
department would advertise them.                                                                                                
                                                                                                                                
Co-Chair Josephson  remarked that  the committee  would hear                                                                    
different testimony the  following day and he  found it hard                                                                    
to know what was accurate.                                                                                                      
                                                                                                                                
Representative  Bynum looked  at the  Cascade Point  project                                                                    
timeline  and   funding  considerations   on  slide   6.  He                                                                    
considered the  Alaska Marine Highway System  (AMHS) and the                                                                    
Cascade Point project and how  the two were linked. He noted                                                                    
that the slide primarily addressed  stage 1. He had received                                                                    
a lot  of feedback  from constituents when  an appropriation                                                                    
had  been   put  towards  building   the  section   of  road                                                                    
associated  with the  project. There  was a  lot of  concern                                                                    
about the highway  system and how the  particular plan would                                                                    
link  into  the  long-term  situation   with  AMHS.  He  had                                                                    
numerous conversations with the  AMHS Board about long-range                                                                    
vision and construction of  new mainliners. Additionally, he                                                                    
wanted to  have discussions  about southern  reconnection to                                                                    
Hyder and  reestablishing the  connection to  Prince Rupert.                                                                    
He stated  that Cascade  Point was a  big obligation  and he                                                                    
thought there may be a  bit of misunderstanding about how it                                                                    
played into  the bigger  vision for  the marine  highway. He                                                                    
asked the commissioner to speak  about the specific decision                                                                    
and  how it  impacted  Cascade Point  and  how following  on                                                                    
stages would fit into the long range plan for AMHS.                                                                             
                                                                                                                                
2:52:28 PM                                                                                                                    
                                                                                                                                
Commissioner Anderson  replied that the long  range plan for                                                                    
AMHS was recently  finished and was a good plan.  One of the                                                                    
elements  recognized that  to reduce  operating costs  long-                                                                    
term, extending roads and shortening  ferry runs was part of                                                                    
the approved  plan. He  stated that  Cascade Point  made the                                                                    
most of the road infrastructure  to reduce the length of the                                                                    
runs in  north Lynn  Canal to  reduce the  time and  cost of                                                                    
running the ferries.                                                                                                            
                                                                                                                                
Representative Bynum understood there  had been major issues                                                                    
with  operating  the current  fleet,  keeping  boats in  the                                                                    
water  and  moving.  He  thought   there  was  a  bit  of  a                                                                    
disconnect with  his community  and understanding  where the                                                                    
project was  going and  how the  funding may  or may  not be                                                                    
directly impacting  keeping vessels underway.  He understood                                                                    
the  desire to  deploy  for  a long-term  plan,  but he  was                                                                    
trying to  understand how the  specific piece of  work would                                                                    
play into the goal and how  it was different than the monies                                                                    
being used  for AMHS itself.  He thought people  forget that                                                                    
it was part  of highway money with highway  match as opposed                                                                    
to keeping a vessel on the water and going to a port.                                                                           
                                                                                                                                
Commissioner  Anderson  replied  that the  department  could                                                                    
follow  up with  a list  of the  different funding  types it                                                                    
leveraged for  AMHS. The department  had done more  and more                                                                    
with all  of its  funding types to  ensure the  ferry system                                                                    
was  running  and  in  good  repair.  He  stated  that  AMHS                                                                    
Director  Craig  Tornga  had  done an  amazing  job  on  the                                                                    
maintenance side with a 98.5  percent vessel uptime for 2024                                                                    
and 2025.  The department  had been investing  in overhauls.                                                                    
He noted that some of  the ferry overhauls were going longer                                                                    
because more work was being  done. The department was trying                                                                    
to  ensure it  was set  up  as it  tackled the  idea of  new                                                                    
mainliners  and replacing  old  vessels one  at  a time.  He                                                                    
relayed that the department  advertised for construction the                                                                    
Tustumena  replacement   vessel  the  previous   Friday.  He                                                                    
detailed  that  the  cost  would  exceed  $300  million.  He                                                                    
elaborated that the Tustumena was  over 60 years old and the                                                                    
replacement  was  needed.  He  stated there  was  some  good                                                                    
momentum and good things taking place.                                                                                          
                                                                                                                                
2:55:23 PM                                                                                                                    
                                                                                                                                
Representative  Bynum asked  the  department to  incorporate                                                                    
the  necessary  stages  of  work,  particularly  related  to                                                                    
Cascade  Point,   into  its  future  presentations   to  the                                                                    
committee.                                                                                                                      
                                                                                                                                
Co-Chair  Schrage considered  whether his  previous question                                                                    
had  been answered.  He  had asked  when  the general  funds                                                                    
would need to  be provided as match to reclaim  the close to                                                                    
$600 million in  federal funds. He asked how  much money was                                                                    
at stake.                                                                                                                       
                                                                                                                                
Commissioner Anderson deferred the question to Mr. Pannone.                                                                     
                                                                                                                                
Mr. Pannone  turned to  slide 5 to  answer the  question. He                                                                    
explained  that when  DOT projected  its  match it  included                                                                    
federal  funds at  varying rates  and advanced  construction                                                                    
and August  redistribution. Beyond  July 1, DOT  was looking                                                                    
to capture $400  million to $500 million in  projects and to                                                                    
ensure   the    department   captured    reasonable   August                                                                    
redistribution beyond July 1.                                                                                                   
                                                                                                                                
Co-Chair  Schrage  considered  the   $400  million  to  $500                                                                    
million  in  jeopardy. He  had  asked  when the  funds  were                                                                    
needed in order to ensure the  state did not lose out on the                                                                    
federal  funds.  He  referenced the  department's  statement                                                                    
that it was good through  July 1 before it would potentially                                                                    
be missing  out on  opportunities. He  thought that  was the                                                                    
date when construction would start.  He asked when the funds                                                                    
needed to be provided for  construction companies to be able                                                                    
to deploy projects after July 1.                                                                                                
                                                                                                                                
Commissioner Anderson  replied that prior to  securing funds                                                                    
the   department   built   out  the   plans,   environmental                                                                    
documents,  utilities, and  secured  the right-of-way.  Once                                                                    
the work was  completed, DOT certified the  project and sent                                                                    
it to  the FHA to secure  the federal funds and  lock in the                                                                    
match. He  relayed that the process  was happening currently                                                                    
and all the way through until  the end of the federal fiscal                                                                    
year on September 30. He  explained that it was a continuing                                                                    
process and timeline. He detailed  that some of the projects                                                                    
may be  certified after July  1 and would not  be advertised                                                                    
until  after certification  and  the securing  of funds.  He                                                                    
relayed  that  it  may  be October  or  November  [before  a                                                                    
project  was advertised]  and those  projects  would be  for                                                                    
construction in 2027.                                                                                                           
                                                                                                                                
Co-Chair   Schrage  remarked   that  the   conversation  was                                                                    
bringing  up  more questions.  He  asked  if the  department                                                                    
needed the funding in hand to certify a project.                                                                                
                                                                                                                                
Commissioner   Anderson   answered   that   the   department                                                                    
certified the project and then  asked the federal government                                                                    
for authorization for the funds to build the project.                                                                           
                                                                                                                                
Co-Chair  Schrage  asked  about  the $400  million  to  $500                                                                    
million in  jeopardy. He  asked if  those projects  were all                                                                    
certified.                                                                                                                      
                                                                                                                                
Commissioner Anderson replied, "No."                                                                                            
                                                                                                                                
Co-Chair  Schrage  asked  what   was  required  to  get  the                                                                    
projects certified and out to bid.                                                                                              
                                                                                                                                
Commissioner  Anderson responded  that  the design,  stamps,                                                                    
plans,  specifications, estimates,  environmental documents,                                                                    
land  acquisitions, and  utility  agreements all  had to  be                                                                    
secured.  There were  a group  of  projects currently  going                                                                    
through the process.                                                                                                            
                                                                                                                                
3:00:15 PM                                                                                                                    
                                                                                                                                
Co-Chair   Schrage   asked   for   verification   that   the                                                                    
certification process  was underway  and was the  only thing                                                                    
holding  things  up.  He asked  for  verification  that  the                                                                    
department did not need more  money and once it finished its                                                                    
internal process  and certified  the projects,  the projects                                                                    
would go  out to  bid and  the state would  be able  to take                                                                    
advantage of  the $400  million to  $500 million  in federal                                                                    
funds.                                                                                                                          
                                                                                                                                
Commissioner Anderson  replied that along with  that was the                                                                    
federal  fiscal year,  apportionments, and  the department's                                                                    
authority.  He  shared  that DOT  only  received  a  certain                                                                    
amount  of authority  annually to  make the  obligations. He                                                                    
elaborated  that the  department had  a tentative  advertise                                                                    
schedule online  showing projects  and when  DOT anticipated                                                                    
they would be delivered  for construction. He explained that                                                                    
DOT believed it  had enough match for  certified and secured                                                                    
projects between the  present day and July 1.  After July 1,                                                                    
most of the match would be used up.                                                                                             
                                                                                                                                
Representative  Stapp thought  committee members  wanted the                                                                    
department to get  as many projects out to  bid as possible.                                                                    
He  stated that  members  wanted to  know  if DOT  currently                                                                    
needed more  money to  get as many  projects as  possible to                                                                    
contractors.                                                                                                                    
                                                                                                                                
Commissioner   Anderson   replied   that  based   on   DOT's                                                                    
projections, the  current match  would allow projects  to be                                                                    
bid  and uninterrupted  through July  1. After  July 1,  the                                                                    
department would not have the  match to continue the program                                                                    
for projects from July to September.                                                                                            
                                                                                                                                
3:02:52 PM                                                                                                                    
                                                                                                                                
Representative Stapp  was hearing Commissioner  Anderson say                                                                    
that DOT  had enough match  for the current  projections. He                                                                    
asked if the department  was projecting fewer projects going                                                                    
out to  bid in the current  year when compared to  the prior                                                                    
year.                                                                                                                           
                                                                                                                                
Commissioner Anderson  answered that DOT was  predicting the                                                                    
year  would be  very similar  to the  prior year.  He stated                                                                    
that  the  past  year  after the  direction  the  department                                                                    
received from  the legislature and others,  it leveraged the                                                                    
advanced  construction tool  that enabled  DOT to  authorize                                                                    
projects  at  present  and  pay  them  in  the  future.  The                                                                    
department  was  intending  to  do the  same  thing  in  the                                                                    
current year,  but it  would not  have the  match to  do the                                                                    
full program.                                                                                                                   
                                                                                                                                
Representative  Stapp asked  if Commissioner  Anderson would                                                                    
like to know the money was available sooner or later.                                                                           
                                                                                                                                
Commissioner  Anderson replied  that  the department  always                                                                    
liked  to  have  certainty;  however,  when  the  department                                                                    
looked at  its projections and targets  for project delivery                                                                    
in relation  to the supplemental,  it did not  believe there                                                                    
would be a disruption through July 1.                                                                                           
                                                                                                                                
Representative  Galvin  thanked  the  commissioner  for  his                                                                    
work. She looked at slide  5 and understood there were funds                                                                    
the  department had  that helped  with  matching funds.  She                                                                    
stated that  some of the  projects that her  constituents in                                                                    
midtown  Anchorage thought  were  going to  happen had  been                                                                    
pulled off  the table.  She highlighted  that 40  percent of                                                                    
Alaska's  population was  located in  Anchorage and  she was                                                                    
all  in for  making sure  the Dalton  Highway, ferries,  and                                                                    
everything else were working.  She appreciated meetings held                                                                    
with  DOT  and  Anchorage Metropolitan  Area  Transportation                                                                    
Solutions  (AMATS) to  determine what  could be  improved in                                                                    
Anchorage. She  stated that the  biggest concern  was around                                                                    
high  volume   and  high  intensity  accident   areas,  some                                                                    
involving pedestrians.                                                                                                          
                                                                                                                                
Representative  Galvin  highlighted  that  there  were  some                                                                    
traffic  calming projects  taken  off the  table, which  she                                                                    
believed  could total  around $30  million. She  shared that                                                                    
her constituents  had made  resolutions annually  asking the                                                                    
state to  do better.  She underscored  that state  roads had                                                                    
seen the  most accidents. She relayed  that approximately 17                                                                    
pedestrians had  died in Anchorage,  which was more  than in                                                                    
most other cities when comparing  per capita. She emphasized                                                                    
that the  city was in the  red zone and her  district was in                                                                    
"the reddest  of the red zone."  She hoped to meet  with the                                                                    
department to learn  what she could do  for constituents and                                                                    
Anchorage to feel  the state was doing  the best, especially                                                                    
on state roads. She read  individuals' names into the record                                                                    
who had been killed walking  in Anchorage including: 30 year                                                                    
old Sandra Blix,  33 year old Francis Katongan,  53 year old                                                                    
Evan Larson Jr,  79 year old Gladys Graf, 34  year old Donna                                                                    
Nielsen, 34  year old  Lorraine Williams,  65 year  old Carl                                                                    
Schmidt,  49  year  old  Janice  Tom,  43  year  old  Wonpen                                                                    
Tawthaisong,  54 year  old  Eric Black,  33  year old  Aaron                                                                    
Cleveland, 85  year old  Clara Mattice,  63 year  old Arthur                                                                    
Stepetin Jr, and  46 year Jason Felder.  She emphasized that                                                                    
half of the  accidents were in her district.  She asked what                                                                    
was going  on with traffic calming  measures, which included                                                                    
lights,  putting trees  in the  right space,  and more.  She                                                                    
asked what  legislators should be doing  differently to make                                                                    
sure Anchorage was not dropping off.                                                                                            
                                                                                                                                
3:09:07 PM                                                                                                                    
                                                                                                                                
Commissioner  Anderson replied  that any  death on  Alaska's                                                                    
highway system  was tragic. He  relayed that  the department                                                                    
paid close  attention to  safety and  wanted to  make safety                                                                    
work in  Anchorage. The $30  million referenced  was highway                                                                    
safety improvement funding. He had  been told by his project                                                                    
delivery teams that they could  not deliver an Ingra/Gambell                                                                    
[streets]  project in  the  current year.  He  noted that  a                                                                    
number of legislators wrote a  letter [about the issue]. The                                                                    
department met with  the mayor of Anchorage and  had come up                                                                    
with a  plan. He  detailed that  the department  revised the                                                                    
plan, put  the $30 million  back in,  and had talked  to its                                                                    
teams about  different ways to  resource the project  to get                                                                    
it finished in the current year.                                                                                                
                                                                                                                                
Representative   Galvin   thanked  the   commissioner.   She                                                                    
understood  that  around  $30  million of  the  $77  million                                                                    
originally headed to Anchorage  had been restored. She noted                                                                    
that  her  district  got  one  of  the  many  projects.  She                                                                    
believed  A  Street  was  the  only  project  that  received                                                                    
funding (among the  many) in her district. She  did not know                                                                    
if  the department  would  patch up  an  area near  Northern                                                                    
Lights Boulevard, Benson Boulevard,  or Minnesota Drive. She                                                                    
shared  that  she spent  half  a  day  driving with  DOT  in                                                                    
Anchorage and had  been told that the department  paid a lot                                                                    
of attention to data. She was  given a list of the locations                                                                    
of  the "high  cost"  accidents with  substantial damage  to                                                                    
people  and  vehicles.  She  emphasized  that  half  of  the                                                                    
accidents  on  the  list  were  in  her  district,  yet  she                                                                    
believed only one project was  restored. She thought half of                                                                    
the funds had been restored  and she was grateful DOT worked                                                                    
with the  mayor to  make it  happen and  she was  asking for                                                                    
more.  She  stated  that  if   there  was  approximately  $1                                                                    
billion,  she hoped  the department  would strive  to follow                                                                    
the data  and she encouraged  DOT to include  the districts'                                                                    
data. She  referred to the  individuals who had  been killed                                                                    
in traffic accidents and stressed  that they all had mothers                                                                    
and many had  children. She remarked that they  were not all                                                                    
from  Anchorage  and  some  were   from  rural  Alaska.  She                                                                    
stressed that the  state could do better  for the community.                                                                    
She would  work together  with the  department and  AMATS on                                                                    
the  department's  responsibility  of keeping  the  economic                                                                    
engine going and keeping people safe.                                                                                           
                                                                                                                                
3:12:48 PM                                                                                                                    
                                                                                                                                
Co-Chair Schrage  thanked the department for  being present.                                                                    
He  had  many concerned  constituents  and  he referenced  a                                                                    
"meet the match"  letter. He relayed that he  had never seen                                                                    
a similar  coalition. He asked  if there were  projects that                                                                    
would  not occur  in  the coming  summer  if the  additional                                                                    
match that was vetoed was not provided by July 1.                                                                               
                                                                                                                                
Commissioner   Anderson  answered   that  it   was  possible                                                                    
depending on  how quickly projects  could be  delivered. The                                                                    
department's current  projections showed it would  be ok. He                                                                    
noted there  was one factor with  the August redistribution.                                                                    
He elaborated  that plans were due  in May and July  was the                                                                    
deadline for  the department to  have a final plan  for what                                                                    
federal funding it  was capable of securing.  He shared that                                                                    
the $183.5 million  [in federal funds] was a  record in 2025                                                                    
and was more than the  department ever thought possible. The                                                                    
initial  estimate from  FWA was  about $66  million for  the                                                                    
current  year, but  DOT  would  be requesting  significantly                                                                    
more. He relayed that there were some variables.                                                                                
                                                                                                                                
Co-Chair Schrage  thought the commissioner seemed  very calm                                                                    
about the situation. He perceived  that the commissioner did                                                                    
not appear worried and as long  as the money was received by                                                                    
July there  was no  problem. He was  trying to  reconcile it                                                                    
with the Meet the Match letter  he had received from what he                                                                    
viewed as an unprecedented  coalition of businesses who were                                                                    
very  concerned about  the state's  ability  to provide  the                                                                    
match to  secure the federal  funds. He asked why  there was                                                                    
concern and uncertainty from industry  when he gathered from                                                                    
the commissioner's testimony that everything was fine.                                                                          
                                                                                                                                
Commissioner Anderson  answered that the industry  had to be                                                                    
worried because  it was their livelihood.  He understood the                                                                    
industry perspective and confirmed  the importance of having                                                                    
certainty.  He  stated that  having  the  matching funds  in                                                                    
place provided certainty for the  fiscal year. He elaborated                                                                    
that if DOT  did not receive the  additional match requested                                                                    
in the supplemental on July  1, there would be projects that                                                                    
did not  go on the  street. He  explained that if  the match                                                                    
was  available early  it would  add more  certainty and  the                                                                    
department did not object to  that. The department submitted                                                                    
a  supplemental  request  based  on what  it  saw  with  its                                                                    
projections.                                                                                                                    
                                                                                                                                
3:16:18 PM                                                                                                                    
                                                                                                                                
Representative  Allard  referenced  incidents  happening  in                                                                    
Anchorage. She was getting annoyed  that DOT was blamed. She                                                                    
stated  there was  a leadership  problem  in Anchorage.  She                                                                    
believed when  the assembly voted  to remove  crosswalks and                                                                    
allow  people to  cross  anywhere it  would  wreak havoc  on                                                                    
state and municipal  roads. She had heard  a legislator tell                                                                    
DOT  it would  have  blood  on its  hands,  which she  found                                                                    
atrocious. She  relayed there was an  interchange coming off                                                                    
of Eagle River that she had  been fighting for over the past                                                                    
eight years. She  noted that the problem had  existed for 15                                                                    
years. There was $8 million  designated for the project, but                                                                    
it  had been  siphoned down.  She elaborated  that initially                                                                    
the project  cost was $22 million  and it was now  up to $55                                                                    
million. She  stated that  no one  in Anchorage  cared about                                                                    
the road  because it was  located in Eagle River.  She asked                                                                    
if  fixes to  roads would  guarantee it  would solve  deaths                                                                    
that should never have happened.  She did not believe people                                                                    
were  recognizing that  individuals who  hit the  people who                                                                    
had  died  were  also  traumatized.   She  shared  that  her                                                                    
daughter   had  witnessed   a   deadly   accident  and   was                                                                    
devastated.  She thought  it was  an [Anchorage]  leadership                                                                    
issue.                                                                                                                          
                                                                                                                                
Commissioner Anderson  answered that the safety  piece could                                                                    
not  just  be  engineering  and projects.  He  relayed  that                                                                    
enforcement mattered.  He highlighted  work done  to improve                                                                    
response times.  Additionally, the department had  put a lot                                                                    
of money  into educating people, reflective  gear, and more.                                                                    
He agreed that there were  many factors involved and it took                                                                    
everyone. He stated that DOT  could not solve the problem on                                                                    
its own.                                                                                                                        
                                                                                                                                
3:19:07 PM                                                                                                                    
                                                                                                                                
Representative   Tomaszewski   stated  it   was   incredibly                                                                    
devastating when  any life  was lost,  especially tragically                                                                    
and  unnecessarily. He  noted that  DOT relied  on a  lot of                                                                    
data. He  noted that  the Anchorage  Assembly decriminalized                                                                    
jaywalking in  2023. He wondered  if it impacted  the number                                                                    
of deaths that occur in the middle  of the road.  He did not                                                                    
expect DOT  to have the  particular data. He  suggested that                                                                    
looking  at  the data  related  to  the assembly's  decision                                                                    
would be a  place to start to determine  whether perhaps the                                                                    
decision was a mistake.                                                                                                         
                                                                                                                                
Representative  Bynum appreciated  that industry  would come                                                                    
speak  to  the committee  the  following  day to  share  its                                                                    
concerns or  excitement about opportunities ahead.  He asked                                                                    
the commissioner to listen to  the hearing the following day                                                                    
to have a response in the future.                                                                                               
                                                                                                                                
Commissioner Anderson replied affirmatively.                                                                                    
                                                                                                                                
3:20:58 PM                                                                                                                    
                                                                                                                                
Representative  Stapp referenced  a  new  overpass that  had                                                                    
been put in  over the Richardson Highway that  went over the                                                                    
train  tracks near  his house.  He had  never seen  numerous                                                                    
cars flipped over  in the ditch until the  overpass had been                                                                    
put  in. He  understood the  overpass was  built to  improve                                                                    
safety, but the train came once  per day at around 2:00 a.m.                                                                    
He  now frequently  saw  cars flipped  over  coming off  the                                                                    
overpass.  He  wondered  about   the  methodology  used  for                                                                    
safety. He could  not prove it, but he  thought the overpass                                                                    
appeared to  be much  more dangerous  than the  train tracks                                                                    
ever were.                                                                                                                      
                                                                                                                                
Commissioner  Anderson  replied  that  typically  overpasses                                                                    
were  installed  to  reduce conflicts  with  railroads.  The                                                                    
department  was currently  working on  the Parks  Highway to                                                                    
get  all grade  separations for  all railroad  tracks across                                                                    
the board  because there was  a pretty serious  conflict. He                                                                    
would follow up with any data.                                                                                                  
                                                                                                                                
Co-Chair Josephson  thanked the presenters. He  reviewed the                                                                    
schedule for the following day.                                                                                                 
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
3:22:47 PM                                                                                                                    
                                                                                                                                
The meeting was adjourned at 3:22 p.m.                                                                                          

Document Name Date/Time Subjects
20260126 House Finance - DOTPF.pdf HFIN 1/26/2026 1:30:00 PM
HB 53
OMB HB55 Mental Health FY26 Veto Summary.pdf HFIN 1/26/2026 1:30:00 PM
HB 55
OMB HB53 Operating FY25 & FY26 Veto Summary.pdf HFIN 1/26/2026 1:30:00 PM
HB 53
OMB SB57 Capital FY25 & FY26 Veto Summary.pdf HFIN 1/26/2026 1:30:00 PM
SB 57
Legal Opionion Leg Legal 062425 HB 53.pdf HFIN 1/26/2026 1:30:00 PM
HB 53
02.03.26 HFIN OMB Gov Vetoes Follow-up to 01.26.26 Hearing.pdf HFIN 1/26/2026 1:30:00 PM
HB 53