Legislature(2009 - 2010)CAPITOL 17

03/09/2010 01:00 PM House TRANSPORTATION


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01:07:19 PM Start
01:07:29 PM HB329
02:16:46 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+= HB 329 DEDICATED TRANSPORT FUND/PUB TRANSPORT TELECONFERENCED
Moved CSHB 329(TRA) Out of Committee
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE TRANSPORTATION STANDING COMMITTEE                                                                           
                         March 9, 2010                                                                                          
                           1:07 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Peggy Wilson, Chair                                                                                              
Representative Craig Johnson, Vice Chair                                                                                        
Representative Kyle Johansen                                                                                                    
Representative Cathy Engstrom Munoz                                                                                             
Representative Tammie Wilson                                                                                                    
Representative Max Gruenberg                                                                                                    
Representative Pete Petersen                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
All members present                                                                                                             
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 329                                                                                                              
"An Act  relating to the  transportation infrastructure  fund, to                                                               
local  public transportation,  to motor  fuel taxes,  and to  the                                                               
motor vehicle  registration fee;  and providing for  an effective                                                               
date."                                                                                                                          
                                                                                                                                
     - MOVED CSHB 329(TRA) OUT OF COMMITTEE                                                                                     
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 329                                                                                                                  
SHORT TITLE: DEDICATED TRANSPORT FUND/PUB TRANSPORT                                                                             
SPONSOR(s): TRANSPORTATION                                                                                                      
                                                                                                                                
02/05/10       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/05/10       (H)       TRA, FIN                                                                                               
02/09/10       (H)       TRA AT 1:00 PM CAPITOL 17                                                                              
02/09/10       (H)       Heard & Held                                                                                           
02/09/10       (H)       MINUTE(TRA)                                                                                            
02/11/10       (H)       TRA AT 1:00 PM CAPITOL 17                                                                              
02/11/10       (H)       Heard & Held                                                                                           
02/11/10       (H)       MINUTE(TRA)                                                                                            
02/18/10       (H)       TRA AT 1:00 PM BUTROVICH 205                                                                           
02/18/10       (H)       Heard & Held                                                                                           
02/18/10       (H)       MINUTE(TRA)                                                                                            
02/25/10       (H)       TRA AT 1:00 PM CAPITOL 17                                                                              
02/25/10       (H)       Heard & Held                                                                                           
02/25/10       (H)       MINUTE(TRA)                                                                                            
03/09/10       (H)       TRA AT 1:00 PM CAPITOL 17                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
REBECCA ROONEY                                                                                                                  
Staff, Representative Peggy Wilson                                                                                              
Alaska State Legislature                                                                                                        
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented the changes contained in Version                                                               
D on behalf of the prime sponsor.                                                                                               
                                                                                                                                
AVES THOMPSON, Executive Director                                                                                               
Alaska Trucking Association                                                                                                     
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 329.                                                               
                                                                                                                                
MIKE GAULT                                                                                                                      
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 329.                                                                          
                                                                                                                                
COLLEEN SOBERAY                                                                                                                 
CH2M Hill                                                                                                                       
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 329.                                                                          
                                                                                                                                
MICHAEL MILLER                                                                                                                  
Granite Construction Company                                                                                                    
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified during the discussion of HB 329.                                                               
                                                                                                                                
REBECCA LOGAN, President                                                                                                        
Associated Builders and Contractors of Alaska (ABC Alaska)                                                                      
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified in support of HB 329.                                                                          
                                                                                                                                
WHITNEY BREWSTER, Director                                                                                                      
Division of Motor Vehicles (DMV)                                                                                                
Department of Administration (DOA)                                                                                              
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Testified and answered questions during the                                                              
discussion of HB 329.                                                                                                           
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:07:19 PM                                                                                                                    
                                                                                                                                
CHAIR  PEGGY  WILSON  called the  House  Transportation  Standing                                                             
Committee  meeting to  order  at 1:07  p.m.   Representatives  P.                                                               
Wilson, Gruenberg,  Johnson, Munoz, and Petersen  were present at                                                               
the  call  to order.    Representatives  Johansen and  T.  Wilson                                                               
arrived as the meeting was in progress.                                                                                         
                                                                                                                                
1:07:29 PM                                                                                                                    
                                                                                                                                
         HB 329-DEDICATED TRANSPORT FUND/PUB TRANSPORT                                                                      
                                                                                                                                
1:08:23 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  announced that the only order  of business would                                                               
be HOUSE  BILL NO.  329, "An Act  relating to  the transportation                                                               
infrastructure  fund, to  local public  transportation, to  motor                                                               
fuel  taxes,  and to  the  motor  vehicle registration  fee;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
CHAIR P. WILSON stated several hearings  have been held on HB 329                                                               
and  a   new  committee  substitute   has  been   developed  that                                                               
incorporates many of the changes that the committee suggested.                                                                  
                                                                                                                                
1:08:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON moved  to  adopt  the proposed  Committee                                                               
Substitute for HB 329 labeled  26-LS-1307\D, Kane, 3/5/10, as the                                                               
working  document.   There  being  no  objection, Version  D  was                                                               
before the committee.                                                                                                           
                                                                                                                                
REPRESENTATIVE JOHNSON objected for the purpose of discussion.                                                                  
                                                                                                                                
1:08:55 PM                                                                                                                    
                                                                                                                                
REBECCA ROONEY, Staff, Representative  Peggy Wilson, Alaska State                                                               
Legislature,  on behalf  of the  sponsor,  explained three  major                                                               
changes contained in Version D.   She referred members to page 3,                                                               
lines 8-9, which  would allow the appropriation of  50 percent of                                                               
the revenues  deposited to the proposed  dedicated transportation                                                               
fund (ATIF) to  be spent each year in addition  to the percent of                                                               
market value (POMV).  This  paragraph was changed to increase the                                                               
available appropriation annually to  allow for bigger projects or                                                               
a  greater  number   of  projects  funded  in   any  given  year.                                                               
Additionally, this provision was added  in case the proposed ATIF                                                               
was not seeded with the  anticipated $1 billion to capitalize the                                                               
fund.                                                                                                                           
                                                                                                                                
1:10:18 PM                                                                                                                    
                                                                                                                                
MS. ROONEY  referred to a  spreadsheet in members'  packets dated                                                               
3/9/2010  titled,  "Appropriation  Estimates Spreadsheet."    She                                                               
indicated  the  spreadsheet was  prepared  by  the Department  of                                                               
Revenue  (DOR).   She directed  members  to Scenario  2, and  the                                                               
column  labeled  "Yearly  Approp" which  projects  appropriations                                                               
from the proposed dedicated transportation  fund based on Version                                                               
K  of HB  329.   The  last column  on the  right, labeled  "Total                                                               
Approp"  lists the  projected appropriation  with the  additional                                                               
revenue available each year.   It is not mandatory to appropriate                                                               
all available funds  each year so the legislature  has the option                                                               
to  retain  the  funds.    She referred  members  to  the  ending                                                               
balances listed in  the two scenarios.  She pointed  out that the                                                               
ending balance in Scenario 1, which  was based on Version D lists                                                               
$900 million more than Scenario 2,  which was based on Version K.                                                               
She  explained  the  difference in  the  amounts  represents  the                                                               
tradeoff  of   completing  more   projects  within   the  20-year                                                               
timeframe.                                                                                                                      
                                                                                                                                
1:11:46 PM                                                                                                                    
                                                                                                                                
MS. ROONEY  referred to  page 4, lines  13-14, which  would allow                                                               
the  appropriations from  the proposed  ATIF to  be used  for the                                                               
operating costs of  Division of Motor Vehicles (DMV).   She noted                                                               
a mistake in the percentage listed  in Version D, which reads one                                                               
percent but should be three percent.   Thus, an amendment will be                                                               
offered for  committee consideration.   She remarked  that during                                                               
this hearing someone from DMV will discuss the DMV figures.                                                                     
                                                                                                                                
1:13:10 PM                                                                                                                    
                                                                                                                                
MS. ROONEY  referred to page  4, lines  28-31, and page  5, lines                                                               
16-18, to  the composition of the  proposed Alaska Transportation                                                               
Infrastructure  Fund Advisory  Council (ATIFAC).   She  explained                                                               
that  Version D  would  change the  composition  of the  proposed                                                               
ATIFAC to 12 members, including  2 legislative members, the House                                                               
and  Senate Transportation  Committee Chairs;  6 DOT&PF  members,                                                               
the  three   regional  DOT&PF  directors,  three   DOT&PF  deputy                                                               
commissioners, and would  add 4 public members, one  from each of                                                               
the four judicial districts.   The public member appointees would                                                               
be  required  to  have substantial  knowledge  of  transportation                                                               
issues  and a  familiarity with  all transportation  modes.   The                                                               
public  members would  be  appointed by  the  governor and  serve                                                               
staggered terms.                                                                                                                
                                                                                                                                
1:14:42 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON  asked  for  a  definition  of  extensive                                                               
experience and substantial knowledge.                                                                                           
                                                                                                                                
MS. ROONEY said it was a "squishy" term at this point.                                                                          
                                                                                                                                
REPRESENTATIVE JOHNSON asked whether  the committee could develop                                                               
a better definition.                                                                                                            
                                                                                                                                
MS.  ROONEY explained  that the  language was  modeled after  the                                                               
definition Pennsylvania  used for  selecting members to  serve on                                                               
its transportation commission.   She offered to  continue to work                                                               
on the definition.                                                                                                              
                                                                                                                                
REPRESENTATIVE JOHNSON asked what  experience a person would need                                                               
to  qualify to  serve  as  a public  member  in the  Pennsylvania                                                               
model.                                                                                                                          
                                                                                                                                
MS.  ROONEY offered  that Pennsylvania  board members  had varied                                                               
experience, ranging from serving on  business boards, as owner or                                                               
operators  of major  transportation  companies,  or specific  job                                                               
training or experience related to transportation.                                                                               
                                                                                                                                
CHAIR  P. WILSON  commented  that public  members  on the  ATIFAC                                                               
would  need to  have extensive  experience and  knowledge in  the                                                               
field of  transportation or transportation  of people  and goods.                                                               
She stated the  goal of acquiring public  members with experience                                                               
that relates to transportation, airplanes, or ferries.                                                                          
                                                                                                                                
REPRESENTATIVE   JOHNSON   expressed   concern  over   the   term                                                               
"extensive  experience" as  he  was not  certain  what that  term                                                               
meant.    He stated  that  if  the term  works  in  the state  of                                                               
Pennsylvania, it should also work  in Alaska.  He envisioned that                                                               
if two people  applied to serve on the ATIFAC,  it is likely that                                                               
the most experienced person would likely be selected.                                                                           
                                                                                                                                
1:17:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ  referred to  page 2, line  19 to  the state                                                               
tax  on  fuel,  and  asked  whether  Version  D  would  return  a                                                               
percentage of revenue to municipal airports.                                                                                    
                                                                                                                                
MS. ROONEY answered  that Version D allows for  the aircraft fuel                                                               
tax to be returned to the airports.                                                                                             
                                                                                                                                
REPRESENTATIVE MUNOZ related her  understanding that unless there                                                               
is an exception this paragraph  would pertain to all aircraft tax                                                               
so it may be necessary to specify the tax that will be returned.                                                                
                                                                                                                                
MS. ROONEY  related that municipal  airports would  still receive                                                               
60 percent of aviation tax.   She offered to ask the bill drafter                                                               
for additional information on the aviation taxes.                                                                               
                                                                                                                                
CHAIR P.  WILSON recalled  that a  certain percentage  is already                                                               
passed on to municipalities.                                                                                                    
                                                                                                                                
REPRESENTATIVE  MUNOZ offered  her  belief that  the language  in                                                               
Version  D  encompasses all  taxes  on  aircraft, unless  another                                                               
provision addresses aircraft tax.                                                                                               
                                                                                                                                
MS. ROONEY  referred to page 2,  line 20, and suggested  that the                                                               
aircraft tax might  be covered under the  specific language "less                                                               
refunds."                                                                                                                       
                                                                                                                                
REPRESENTATIVE JOHNSON  related that this language  is limited to                                                               
the fuel  tax and not  passenger facility charges  (PFC), landing                                                               
fees, or other revenue sources at airports.                                                                                     
                                                                                                                                
REPRESENTATIVE MUNOZ, in response to  Ms. Rooney, thanked her for                                                               
noting the  location that  addresses aviation  tax in  Section 5,                                                               
page 5, line 32 of Version D.                                                                                                   
                                                                                                                                
1:20:26 PM                                                                                                                    
                                                                                                                                
AVES THOMPSON,  Executive Director, Alaska  Trucking Association,                                                               
read his testimony as follows [original punctuation provided]:                                                                  
                                                                                                                                
     Thank you.  Madame Chair  and members of the committee,                                                                    
     I am  Aves Thompson,  Executive Director of  the Alaska                                                                    
     Trucking Association.   The Alaska Trucking Association                                                                    
     is   a  state   wide   organization  representing   the                                                                    
     interests  of  our  nearly 200  member  companies  from                                                                    
     Barrow  to Ketchikan.   Freight  movement represents  a                                                                    
     large chunk of  our economy and impacts all  of us each                                                                    
     and every  day.  The simple  truth is that "if  you got                                                                    
     it, a truck brought it."                                                                                                   
                                                                                                                                
     One   of  the   priorities  of   the  Alaska   Trucking                                                                    
     Association has  been a  state funded  capital projects                                                                    
     program as  federal funding is very  likely to decrease                                                                    
     to  a  point where  it  will  no longer  meet  Alaska's                                                                    
     transportation  infrastructure needs.  Alaska needs  to                                                                    
     invest our dollars in our transportation system.                                                                           
                                                                                                                                
     We believe  that HB329 goes  a long way to  setting the                                                                    
     stage  for  a  robust  state  funded  capital  projects                                                                    
     program  that will  benefit all  motorists  as well  as                                                                    
     other users of other transportation modes.                                                                                 
                                                                                                                                
     As  the  largest  payer  of the  motor  fuel  tax,  the                                                                    
     trucking industry  is glad to  see an effort  to devote                                                                    
     these  user fees  to the  improvement and  expansion of                                                                    
     our  state  highway  system   infrastructure.    As  an                                                                    
     association,  we  have   supported  fuel  tax  increase                                                                    
     proposals in  the past, provided they  are dedicated to                                                                    
     the highway system.                                                                                                        
                                                                                                                                
     We understand  that some  changes will  be made  to the                                                                    
     makeup of the ATIF Advisory  Board and are hopeful that                                                                    
     one  of the  members of  that  board will  be from  the                                                                    
     trucking  industry.   We  are  also  hopeful that  this                                                                    
     system will  tend to de-politicize the  decision making                                                                    
     process.                                                                                                                   
                                                                                                                                
     One additional concern is that  there may be a tendency                                                                    
     to look  to this fund to  support more and more  of the                                                                    
     state  expenditures  on our  highway  system.   We  are                                                                    
     hopeful  that  the  ATIF  appropriations  will  provide                                                                    
     additional  funding  as   General  Fund  appropriations                                                                    
     continue  to support  a robust  state capital  projects                                                                    
     program.  Simply put, if the  ATIF is not an add on, it                                                                    
     won't accomplish its' purpose.                                                                                             
                                                                                                                                
     We believe  the Transportation Infrastructure  Fund has                                                                    
     the potential  to supplement existing programs.   Thank                                                                    
     you.                                                                                                                       
                                                                                                                                
1:23:35 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON remarked that Mr. Thompson has presented a good                                                                 
reason to consider adding someone from the trucking association.                                                                
                                                                                                                                
REPRESENTATIVE JOHNSON asked whether a designee from the                                                                        
trucking industry should be added, and if so, for guidance on a                                                                 
definition to identify the trucking representative.                                                                             
                                                                                                                                
                                                                                                                                
MR.  THOMPSON agreed  that the  ATA would  feel comfortable  with                                                               
someone from  the trucking industry to  serve on the ATIFAC.   He                                                               
suggested selecting a  person from the motor carrier  side of the                                                               
trucking industry, such as someone  working with a major trucking                                                               
organization that operates on the statewide highway system.                                                                     
                                                                                                                                
REPRESENTATIVE  JOHNSON   offered  the  language  might   read  a                                                               
representative from  the ATA  or their  designee, as  selected by                                                               
the ATA.                                                                                                                        
                                                                                                                                
MR. THOMPSON agreed.                                                                                                            
                                                                                                                                
1:26:08 PM                                                                                                                    
                                                                                                                                
MIKE GAULT  explained that he  is representing  himself, although                                                               
he  has   32  years   of  experience   working  in   the  highway                                                               
construction  industry.   He  related  that he  has  20 years  of                                                               
experience as  a senior project  engineer for the  Central Region                                                               
of DOT&PF.  He expressed his support  for HB 329.  He pointed out                                                               
that state-funded  projects are  less restrictive  than federally                                                               
funded projects.   Thus, the  trend has  been to use  state funds                                                               
whenever  possible  on  DOT&PF  projects.   He  advocated  for  a                                                               
dedicated fuel tax  for automotive and aviation fuel  tax to fund                                                               
the proposed  ATIF.  He  suggested that the proposed  ATIF should                                                               
also be  used for  maintenance and not  just for  construction of                                                               
capital projects.                                                                                                               
                                                                                                                                
1:29:07 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  responded that the bill would  deposit the motor                                                               
fuel taxes  and vehicle registration  fees to the  proposed ATIF,                                                               
after some uses currently provided for are covered.                                                                             
                                                                                                                                
1:30:26 PM                                                                                                                    
                                                                                                                                
COLLEEN SOBERAY, CH2M Hill, offered  her company's support for HB
329.    She   offered  his  belief  that  HB   329  will  augment                                                               
transportation  funding needs  while  allowing  the state  better                                                               
control  of projects.   Federal  funds are  often necessary,  but                                                               
come  with   stringent  requirements  that   significantly  delay                                                               
completion  of  projects.    Additionally,  federal  dollars  are                                                               
declining  in Alaska.   She  explained that  she attends  several                                                               
out-of-state  transportation conferences  per year.   Last  year,                                                               
other  states  were "pointing  the  finger"  at Alaska's  federal                                                               
funding match compared  to higher populous states.   It was clear                                                               
to her there will be vocal  opposition to continue high levels of                                                               
federal funding  to Alaska.   Still, a  large gap  exists between                                                               
Alaska's  transportation needs  and  funding for  projects.   She                                                               
predicted that the gap will continue  to grow.  She asked how the                                                               
legislature  will be  able  to  address the  growing  gap in  the                                                               
future.   Transportation  investment  has been  proven  to be  an                                                               
economic driver  and a competitive  advantage for states.   Times                                                               
have changed,  she said.   Alaska prides itself in  being "doers"                                                               
and "an  owner state."  Alaska  is at a crossroads  that requires                                                               
it to be  creative and proactive with funding  initiatives.  This                                                               
bill  represents proactive  government and  addresses multi-modal                                                               
transportation  needs.   Studies have  shown that  transportation                                                               
systems can  help or hinder local  economies.  The ATIF  is about                                                               
jobs  and economies.   The  DOT&PF has  about 3,400  employees as                                                               
compared  to  more  than 71,000  transportation  industry-related                                                               
jobs in  Alaska, including  jobs in the  trucking industry.   She                                                               
said,  "I   trust  the  legislature  will   finalize  this  bill,                                                               
providing for the  details of the fund, control of  the fund, and                                                               
appropriations of  the fund."   She urged members to  support the                                                               
bill.                                                                                                                           
                                                                                                                                
1:33:06 PM                                                                                                                    
                                                                                                                                
MICHAEL MILLER, Granite Construction  Company, stated that he has                                                               
worked in the construction industry for  almost 37 years.  He has                                                               
served   as  the   past-president  of   the  Associated   General                                                               
Contractors of Alaska  (AGC) as well as a member  of the national                                                               
AGC's  Western Association  of State  and Highway  Transportation                                                               
Official's  Committee.    This bill  recognizes  the  future,  he                                                               
stated.   Alaska  can no  longer characterize  itself as  "small,                                                               
poor,  and  remote."    The  Federal Highway  Trust  Fund  is  in                                                               
jeopardy  and the  new reauthorization  will not  be friendly  to                                                               
rural states.  Passing  this bill is "a smart thing  to do.  It's                                                               
forward  looking.   It  will  create jobs  and  will benefit  the                                                               
state's economy  many times  over."   He suggested  the committee                                                               
review the  Alaska Municipal League's study  January 2010, Alaska                                                               
Transportation Finance Study to obtain additional ideas.                                                                        
                                                                                                                                
1:35:26 PM                                                                                                                    
                                                                                                                                
REBECCA LOGAN, President, Associated  Builders and Contractors of                                                               
Alaska  (ABC Alaska),  related that  ABC Alaska  supports HB  329                                                               
since it  creates the opportunity  to depoliticize  the decisions                                                               
surrounding  transportation projects.    Additionally, this  bill                                                               
would  create  a  dedicated  funding  stream  for  transportation                                                               
projects, contains a  strong element of planning  for the future,                                                               
and establishes  criteria for selecting projects.   She suggested                                                               
when selecting  four public members  to serve on the  ATIFAC that                                                               
someone should be  selected who has a  construction background on                                                               
large infrastructure  projects.   She emphasized that  firms that                                                               
work on the larger projects  should participate by serving on the                                                               
ATIFAC.                                                                                                                         
                                                                                                                                
1:36:42 PM                                                                                                                    
                                                                                                                                
CHAIR P.  WILSON, after first  determining no one else  wished to                                                               
testify, closed public testimony on HB 329.                                                                                     
                                                                                                                                
1:37:14 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  referred to page 4, line 13,  to an amendment in                                                               
members' packets.                                                                                                               
                                                                                                                                
1:38:26 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON  made  a  motion to  adopt  Amendment  1,                                                               
labeled 26-LS1307\D.1, Kane, 3/9/10, which read:                                                                                
                                                                                                                                
     Page 4, line 13:                                                                                                           
          Delete "one"                                                                                                          
          Insert "three"                                                                                                        
                                                                                                                                
REPRESENTATIVE JOHANSEN objected for the purpose of discussion.                                                                 
                                                                                                                                
1:38:42 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN expressed  concern  with the  allocation                                                               
listed in HB  329.  He said he thought  that placing the language                                                               
in  statue  may  "tie  the  hands  of  the  legislature"  as  the                                                               
appropriating body.  He remarked that  he did not wish to hold up                                                               
the bill.  He then removed his objection.                                                                                       
                                                                                                                                
CHAIR  P.   WILSON  explained  that  Amendment   1  would  affect                                                               
subsection (d) which read, "Not  more than one percent..."  Thus,                                                               
Amendment 1  would allow up  to three percent to  be appropriated                                                               
for the  operating costs of  the DMV.  Additionally,  Amendment 1                                                               
would actually  limit the amount  that can  be spent and  the DMV                                                               
would  still need  to  justify its  operating  costs through  the                                                               
budget process.                                                                                                                 
                                                                                                                                
1:40:40 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON referred  to page 3, line  19, to language                                                               
that read "80 percent of the  appropriations from the fund may be                                                               
used..."   He pointed out that  it does not read  "must be used,"                                                               
which  gives the  department  the  flexibility to  use  up to  80                                                               
percent.  However, the language  does not require the legislature                                                               
to  appropriate the  entire 80  percent.   He said  he understood                                                               
Representative Johansen's concern, but  thought this language may                                                               
"soften it a little bit."                                                                                                       
                                                                                                                                
REPRESENTATIVE  JOHANSEN maintained  his  concern  that the  bill                                                               
caps  the  percentage,   which  may  dictate  how   much  can  be                                                               
appropriated for each transportation mode.                                                                                      
                                                                                                                                
1:42:05 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG  also  expressed  concern.    He  said,                                                               
"Either authorizing  or appropriating, there  is only such  a big                                                               
pie."   He mentioned that  one percent  or three percent  may not                                                               
seem like  a lot, but he  shared the concern that  the allocation                                                               
is over 100 percent.                                                                                                            
                                                                                                                                
1:43:02 PM                                                                                                                    
                                                                                                                                
WHITNEY  BREWSTER, Director,  Division of  Motor Vehicles  (DMV),                                                               
Department   of  Administration   (DOA),   explained  the   DMV's                                                               
operating and  capital expenditures.   The DMV's  operating funds                                                               
are funded through receipt supported  services (RSS), which means                                                               
the DMV "lives  off" its receipts and surpluses  are deposited to                                                               
the  general  fund  (GF).    The  DMV  goes  through  the  normal                                                               
budgetary   process   and    the   legislature   authorizes   its                                                               
expenditures, but the  funding source is from RSS.   She referred                                                               
the  committee  to  a spreadsheet  in  members'  packets  titled,                                                               
"Division of  Motor Vehicles, Revenues,  and Expenditures."   She                                                               
explained the DMV funding process  by referring members to FY 11,                                                               
to  the  projected revenues  of  $64,356,300.   She  stated  that                                                               
roughly $12  million is  currently collected  on behalf  of other                                                               
entities, such  as the  Motor Vehicle  Registration Tax  which is                                                               
collected  for  local  cities.   She  remarked  that  $37,415,900                                                               
represents  the vehicle  registration  fees  collected, which  is                                                               
designated for the  ATIF.  The remaining revenue  is derived from                                                               
fees  collected,   including  from  drivers'   licenses,  license                                                               
plates,  identification  cards,  specialty  vehicle  plates,  and                                                               
motor  vehicle  titles.   The  DMV  currently retains  a  certain                                                               
portion   of  the   Motor  Vehicle   Registration  Tax   for  its                                                               
operations.     She  turned  to   the  DMV   Expenditures,  which                                                               
identifies the RSS operating expenses for FY 11 at $16,286,000.                                                                 
                                                                                                                                
1:46:25 PM                                                                                                                    
                                                                                                                                
MS. BREWSTER  related that since  the DMV collects less  than the                                                               
anticipated fees  collected, it  will have  shortfalls.   The DMV                                                               
advocates for enough  funds to operate the DMV.   She anticipated                                                               
that  the  three  percent appropriation  under  consideration  in                                                               
Amendment 1  would likely  be sufficient for  FY 2012.   However,                                                               
she projected  a shortfall would  exist for the DMV,  which could                                                               
result in  the DMV require supplemental  funding since two-thirds                                                               
of  the DMV's  budget covers  personal services.   She  estimated                                                               
that in  FY 10,  a potential  shortfall exists  in the  amount of                                                               
$9.2 million.   She offered  the DMV's  support for the  bill but                                                               
expressed concern over  that the bill caps the  percentage of the                                                               
appropriation to cover the DMV's operating expenses.                                                                            
                                                                                                                                
1:48:27 PM                                                                                                                    
                                                                                                                                
CHAIR  P. WILSON  recalled earlier  discussions  on this  matter.                                                               
She  related that  the next  committee of  referral is  the House                                                               
Finance  Standing  committee,  which   would  be  an  appropriate                                                               
committee to review the budgetary impact for the DMV.                                                                           
                                                                                                                                
1:49:02 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON  inquired as to whether  the DMV projected                                                               
a $9 million deficit in 10 years.                                                                                               
                                                                                                                                
MS. BREWSTER agreed with the projected deficit amount.                                                                          
                                                                                                                                
REPRESENTATIVE JOHNSON asked what  percentage was used to project                                                               
the $9 million deficit.                                                                                                         
                                                                                                                                
MS. BREWSTER  answered that the  figure used was a  three percent                                                               
increase  per year.    She  explained that  the  DMV attempts  to                                                               
contain its costs,  but with two-thirds of  its budget consisting                                                               
of personal services, the DMV does not have much control.                                                                       
                                                                                                                                
REPRESENTATIVE  JOHNSON asked  whether the  DMV submitted  a ten-                                                               
year plan to the finance committee.                                                                                             
                                                                                                                                
MS. BREWSTER said she was not  certain.  She offered to follow-up                                                               
after  the meeting.    She  stated that  the  three percent  used                                                               
represented an estimate.                                                                                                        
                                                                                                                                
REPRESENTATIVE JOHNSON expressed interest  in the DMV's projected                                                               
budget.                                                                                                                         
                                                                                                                                
MS.  BREWSTER  offered to  provide  the  budget documents.    She                                                               
remarked that the DMV requested  a budget decrement this year and                                                               
the DMV is conscious of its  budget and "pays close attention" to                                                               
costs.                                                                                                                          
                                                                                                                                
1:51:11 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHANSEN referred to  FY 11 and projected revenues                                                               
of $64 million  on the DMV's spreadsheet.  He  commented that $12                                                               
million is collected on behalf  of other entities and $37 million                                                               
would be deposited into the proposed ATIF.                                                                                      
                                                                                                                                
MS. BREWSTER  answered yes, that  $37 million would  be deposited                                                               
to the ATIF.                                                                                                                    
                                                                                                                                
1:52:03 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN  asked  if  the  DMV  would  have  $14.9                                                               
million  remaining in  revenue,  but anticipated  $26 million  in                                                               
expenditures.                                                                                                                   
                                                                                                                                
MS.  BREWSTER  responded  that  the  DMV's  operating  costs  are                                                               
projected at $16.2 million in  RSS, but adding in the anticipated                                                               
capital  expenditures,  the  total  expenditures for  FY  11  are                                                               
anticipated at $26 million and revenues of $14.9 million.                                                                       
                                                                                                                                
CHAIR P.  WILSON pointed out  that the fiscal note  reflects $2.5                                                               
million per year for FY 2011-FY 2016.                                                                                           
                                                                                                                                
MS.  BREWSTER, in  response  to  Representative Johansen,  stated                                                               
that the $37  million in fees collected by the  DMV are deposited                                                               
to the state's general fund.                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN commented  that currently  the DMV  is a                                                               
"money maker."                                                                                                                  
                                                                                                                                
MS. BREWSTER answered yes.                                                                                                      
                                                                                                                                
There being no further objection, Amendment 1 passed.                                                                           
                                                                                                                                
1:54:58 PM                                                                                                                    
                                                                                                                                
The committee took an at-ease from 1:54 p.m. to 1:55 p.m.                                                                       
                                                                                                                                
1:55:45 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  asked whether the committee  would like                                                               
to set  out maximum percentages for  allocation to transportation                                                               
modes  or leave  the  categories  listed but  to  not assign  any                                                               
percentages.  For example, he  expressed interest in increases to                                                               
public  transportation in  his district.   He  restated that  the                                                               
committee could  list transportation  categories, but  not assign                                                               
percentages.                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHANSEN related  that  he  would be  comfortable                                                               
moving the  bill on  to the House  Finance Standing  Committee to                                                               
work on the allocation issue.                                                                                                   
                                                                                                                                
CHAIR  P.  WILSON recalled  during  public  testimony the  Alaska                                                               
Trucking  Association  (ATA)   and  major  construction  industry                                                               
representatives  asked  for participation  on  the  ATIFAC.   She                                                               
referred  to page  5  to  the composition  of  ATIFAC, which  she                                                               
offered as a substantive rather than financial consideration.                                                                   
                                                                                                                                
REPRESENTATIVE JOHANSEN agreed.                                                                                                 
                                                                                                                                
REPRESENTATIVE   GRUENBERG  asked   to  discuss   percentages  of                                                               
allocation.                                                                                                                     
                                                                                                                                
CHAIR P.  WILSON asked to  first consider the composition  of the                                                               
ATIFAC.                                                                                                                         
                                                                                                                                
1:59:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE T.  WILSON related  that the proposed  four public                                                               
members  could  accommodate  the ATA  and  construction  industry                                                               
participation.  She said she  thought the current proposed ATIFAC                                                               
is good.                                                                                                                        
                                                                                                                                
REPRESENTATIVE JOHANSEN  agreed.   He said  he thought  that many                                                               
user groups  would be  interested in  participating and  the four                                                               
public members should suffice.                                                                                                  
                                                                                                                                
REPRESENTATIVE  JOHNSON offered  his belief  that it  would be  a                                                               
good idea  to have the  two additional  user groups serve  on the                                                               
proposed ATIFAC.                                                                                                                
                                                                                                                                
CHAIR  P.  WILSON  asked  for the  committee's  interest  in  the                                                               
ATIFAC.                                                                                                                         
                                                                                                                                
2:01:49 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE JOHNSON offered Conceptual  Amendment 2 to add one                                                               
member  of  Alaska  Trucking  Association and  a  member  of  the                                                               
construction industry  that works  on infrastructure to  serve on                                                               
the proposed ATIFAC.                                                                                                            
                                                                                                                                
REPRESENTATIVE JOHANSEN objected.                                                                                               
                                                                                                                                
REPRESENTATIVE  T.  WILSON pointed  out  that  the public  member                                                               
appointments would be made by  the governor.  She speculated that                                                               
the  state's  overall  needs  may  change.    She  suggested  the                                                               
committee not specifically assign  the public members to sectors,                                                               
and simply allow the appointment process to work.                                                                               
                                                                                                                                
2:03:32 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON related  that  one member  of the  ATIFAC                                                               
should be an ATA  member who uses the road on  a daily basis, but                                                               
the  construction  of  the infrastructure  position  could  be  a                                                               
person who works for the AMHS  or the Ketchikan shipyard.  He did                                                               
not  envision the  transportation  infrastructure designee  would                                                               
exclude   anyone  involved   in   major  transportation   issues.                                                               
Designating  someone who  works  on  major infrastructure  places                                                               
someone actively  involved in transportation construction  on the                                                               
ATIFAC, he  stated.  He said  he thought that person  would bring                                                               
extensive knowledge to the process.                                                                                             
                                                                                                                                
REPRESENTATIVE  PETERSEN  pointed  out  that 12  members  on  the                                                               
proposed ATIFAC would likely bring  a wide variety of backgrounds                                                               
to the council.   He also agreed it was  not necessary to specify                                                               
individuals  from  transportation  sectors  to  serve  as  public                                                               
members.                                                                                                                        
                                                                                                                                
2:05:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON  withdrew  Conceptual Amendment  2.    He                                                               
maintained  that his  concern is  primarily  over the  "extensive                                                               
experience" language in the bill.                                                                                               
                                                                                                                                
REPRESENTATIVE JOHNSON  expressed concern  about the  two members                                                               
of  the legislature  being appointed  to an  administrative body.                                                               
He reported  his own experience  with the  AMATS.  He  recalled a                                                               
suggestion at a prior meeting.                                                                                                  
                                                                                                                                
REPRESENTATIVE  JOHANSEN  made  a   motion  to  adopt  Conceptual                                                               
Amendment  3, on  page  4,  lines 29-30,  that  the two  proposed                                                               
legislative members selected to serve  on the ATIFAC be severable                                                               
from the bill.   He stated that  he did not want  the entire bill                                                               
to  "go down"  if the  membership  participation is  found to  be                                                               
unconstitutional.                                                                                                               
                                                                                                                                
REPRESENTATIVE T. WILSON objected.                                                                                              
                                                                                                                                
REPRESENTATIVE  GRUENBERG  explained  severability clauses.    He                                                               
stated current  statutes contains a general  severability clause,                                                               
for example, if any provision  in a bill is unconstitutional, the                                                               
presumption  is the  rest of  the  bill would  not be  considered                                                               
unconstitutional.   He further stated that  separate severability                                                               
language  would rarely  be put  in the  bill itself,  although it                                                               
could be  included.  He  said he did not  have an issue  in doing                                                               
so, but  normally severability  would apply  to the  entire bill.                                                               
He  asked whether  Representative Johnson's  intent was  that the                                                               
severability would apply only to the specific ATIFAC provision.                                                                 
                                                                                                                                
REPRESENTATIVE  JOHNSON  responded   that  his  specific  concern                                                               
surrounds the  history of legislators  being removed  from boards                                                               
due to the separation of powers issue.   He did not object to the                                                               
severability  clause applying  to the  whole bill.   However,  he                                                               
wanted to be  clear that he did  not wish HB 329 to  "go down" if                                                               
the  legislature appointments  to  the ATIFAC  were  found to  be                                                               
unconstitutional.                                                                                                               
                                                                                                                                
2:09:01 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  GRUENBERG suggested  other constitutional  issues                                                               
could arise.   He offered his belief  that Representative Johnson                                                               
would like a severability clause added at the end of the bill.                                                                  
                                                                                                                                
REPRESENTATIVE JOHNSON  pointed out  that Conceptual  Amendment 3                                                               
conceptual so  it would be up  to the bill drafter  to decide the                                                               
specific placement.                                                                                                             
                                                                                                                                
REPRESENTATIVE  GRUENBERG  restated   that  normally  a  separate                                                               
section would add a severability clause.                                                                                        
                                                                                                                                
2:10:13 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE PETERSEN  recalled the  possibility of  making the                                                               
chairs of the House and  Senate Transportation committees as non-                                                               
voting  members on  the proposed  ATIFAC and  asked whether  that                                                               
could solve the problem.                                                                                                        
                                                                                                                                
REPRESENTATIVE JOHNSON reported that  he previously was appointed                                                               
as a non-voting  member serving on AMATS, but the  court ruled he                                                               
was not eligible  to serve and prohibited him  from serving being                                                               
on the board.  He further recalled that he was strictly an ex-                                                                  
officio member and recalled his situation was similar to this.                                                                  
                                                                                                                                
CHAIR P. WILSON restated Conceptual Amendment 3.                                                                                
                                                                                                                                
REPRESENTATIVE  JOHANSEN  offered  that  he  supports  Conceptual                                                               
Amendment  3,   but  since  the   bill  is  subject   to  general                                                               
severability  provisions, he  did not  believe the  provision was                                                               
specifically needed.                                                                                                            
                                                                                                                                
REPRESENTATIVE JOHANSEN  removed his  objection.  There  being no                                                               
further objection, Conceptual Amendment 3 was adopted.                                                                          
                                                                                                                                
2:12:39 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  JOHNSON  moved  to  report HB  329,  Version  26-                                                               
LS1307\D,  Kane,  3/5/10,  as  amended,  out  of  committee  with                                                               
individual  recommendations and  the  accompanying fiscal  notes.                                                               
There being  no objection,  CSHB 329(TRA)  was reported  from the                                                               
House Transportation Standing Committee.                                                                                        
                                                                                                                                
2:13:09 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON applauded the  committee as being proactive.  She                                                               
related that needs  and funding gaps exist  throughout the state.                                                               
The proposed  dedicated transportation  fund, ATIF,  is important                                                               
in order  for economic and  resource development to happen.   She                                                               
pointed  out  that  the  founders   of  the  Alaska  Constitution                                                               
grandfathered   in  two   dedicated   funds  and   one  was   for                                                               
transportation.  Thus, this bill  is not contrary to action taken                                                               
by the drafters of the constitution.   Passing this bill could be                                                               
a  big  step  for  Alaska  to  move  forward  economically  since                                                               
transportation has  been proven  to be an  economic driver.   She                                                               
thanked members for their work.                                                                                                 
                                                                                                                                
REPRESENTATIVE  JOHANSEN  commented  on  the  great  process  and                                                               
commended the  committee's staff.  He  said he was glad  that the                                                               
sponsor was open to suggestions.   He offered his belief that the                                                               
best thing  the crafters of  the state's constitution did  was to                                                               
allow for  a process  to make  changes to  the constitution.   In                                                               
1955, a computer with the  ability of our current computers would                                                               
have taken up an entire warehouse.                                                                                              
                                                                                                                                
2:16:46 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Transportation Standing  Committee meeting was adjourned  at 2:16                                                               
p.m.                                                                                                                            

Document Name Date/Time Subjects
HB329 Ver D.pdf HTRA 3/9/2010 1:00:00 PM
HB 329