Legislature(2009 - 2010)CAPITOL 17

04/06/2010 01:00 PM House TRANSPORTATION


Download Mp3. <- Right click and save file as

Audio Topic
01:04:21 PM Start
01:04:25 PM Alaska Class Ferry Discussion by Jim Beedle, Deputy Commissioner of Marine Operations, Dot&pf
02:01:44 PM Status of Federal Authorizations by Jeff Ottesen, Director, Division of Program Development, Department of Transportation & Public Facilities
02:17:29 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Presentations:
+ Alaska Class Ferry Discussion, by Jim TELECONFERENCED
Beedle, Deputy Commissioner of Marine
Operations, DOT/PF
+ Status of Federal Authorizations, by Jeff TELECONFERENCED
Ottesen, Director, Division of Program
Development
+ Bills Previously Heard/Scheduled TELECONFERENCED
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE TRANSPORTATION STANDING COMMITTEE                                                                           
                         April 6, 2010                                                                                          
                           1:04 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Peggy Wilson, Chair                                                                                              
Representative Kyle Johansen                                                                                                    
Representative Cathy Engstrom Munoz                                                                                             
Representative Tammie Wilson                                                                                                    
Representative Max Gruenberg                                                                                                    
Representative Pete Petersen                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Craig Johnson, Vice Chair                                                                                        
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
ALASKA CLASS FERRY DISCUSSION BY JIM BEEDLE~ DEPUTY COMMISSIONER                                                                
OF MARINE OPERATIONS~ DOT&PF                                                                                                    
                                                                                                                                
STATUS OF FEDERAL AUTHORIZATIONS BY JEFF OTTESEN~ DIRECTOR~                                                                     
DIVISION OF PROGRAM DEVELOPMENT~ DEPARTMENT OF TRANSPORTATION &                                                                 
PUBLIC FACILITIES                                                                                                               
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
No previous action to record                                                                                                    
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
JIM BEEDLE, Deputy Commissioner of Marine Operations                                                                            
Marine Highway System (AMHS)                                                                                                    
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Presented a PowerPoint on the Alaska Class                                                               
Ferry.                                                                                                                          
                                                                                                                                
JEFF OTTESEN, Director                                                                                                          
Division of Program Development                                                                                                 
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Testified and answered questions during the                                                              
discussion of the status update on Federal Authorizations                                                                       
Package.                                                                                                                        
                                                                                                                                
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:04:21 PM                                                                                                                    
                                                                                                                                
CHAIR  PEGGY  WILSON  called the  House  Transportation  Standing                                                             
Committee  meeting to  order  at 1:04  p.m.   Representatives  P.                                                               
Wilson, Munoz, Petersen,  and T. Wilson were present  at the call                                                               
to order.  Representatives Gruenberg  and Johansen arrived as the                                                               
meeting was in progress.                                                                                                        
                                                                                                                                
^Alaska   Class   Ferry   Discussion  by   Jim   Beedle,   Deputy                                                               
Commissioner of Marine Operations, DOT&PF                                                                                       
                                                                                                                                
 Alaska Class Ferry Discussion by Jim Beedle, Deputy Commissioner                                                           
                  of Marine Operations, DOT&PF                                                                              
                                                                                                                              
1:04:25 PM                                                                                                                    
                                                                                                                                
JIM  BEEDLE, Deputy  Commissioner  of  Marine Operations,  Marine                                                               
Highway  System (AMHS),  Department  of  Transportation &  Public                                                               
Facilities (DOT&PF), stated the  Alaska Class Ferry (ACF) project                                                               
started in 2006, and the AMHS has held many hearings statewide.                                                                 
                                                                                                                                
1:07:05 PM                                                                                                                    
                                                                                                                                
MR.  BEEDLE read  the Project  Mission Statement  for the  Alaska                                                               
Class  Ferry [slide  1].   The AMHS's  mission is  to design  and                                                               
construct the next generation of  ferries to begin replacement of                                                               
the aging  AMHS fleet.   He  noted that the  new ferries  will be                                                               
environmentally responsible, fuel efficient,  and versatile.  The                                                               
new ferries  should enhance  the AMHS  operations on  current and                                                               
future  routes  within  inside  waters and  enable  the  AMHS  to                                                               
continue its tradition  of providing safe, reliable  service.  He                                                               
envisioned that most  of the future transportation  needs will be                                                               
provided by  a day  boat such  as the  Alaska Class  Ferry (ACF).                                                               
The  largest  numbers  of   vehicles  currently  transported  are                                                               
between the communities of Juneau to Haines and Skagway.                                                                        
                                                                                                                                
1:08:28 PM                                                                                                                    
                                                                                                                                
MR. BEEDLE  outlined the importance  of replacing  ferries [slide                                                               
3].   The replacement  process needs  to begin  immediately since                                                               
all four ferries will need to  be replaced.  He noted that modern                                                               
safety  features  will be  incorporated  into  the vessels.    He                                                               
pointed out the vessels the M/V  Taku, the M/V Kennicott, and the                                                               
M/V   Malaspina  are   the  ferries   currently  authorized   for                                                               
international travel.   Thus, these vessels can  travel to Prince                                                               
Rupert.  The  remaining vessels in the fleet are  not equipped to                                                               
meet the  international requirements.   He explained the  ease in                                                               
incorporating  new   rules  and  technologies  on   vessels  when                                                               
building a new ship rather than retrofitting an older vessel.                                                                   
                                                                                                                                
MR. BEEDLE  discussed the DOT&PF's approach  used for replacement                                                               
of the  AMHS ferries [slide  4].   He explained that  the process                                                               
included conducting a feasibility  study, developing the concept,                                                               
and executing the preliminary design.   He noted that this year's                                                               
Governor's budget request includes  funding for the first vessel.                                                               
The DOT&PF is currently in  the process of developing the request                                                               
for  proposal  (RFP),   which  must  also  be   approved  by  the                                                               
Department of  Law.  Numerous  shipyards have  expressed interest                                                               
in the  project and  are following the  Alaska Class  Ferry (ACF)                                                               
process.                                                                                                                        
                                                                                                                                
1:10:24 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON asked whether  any Alaskan shipyard is capable of                                                               
building the Alaska Class Ferry (ACF).                                                                                          
                                                                                                                                
MR. BEEDLE  responded that  Alaska Ship  and Drydock,  Inc. (ASD)                                                               
located in Ketchikan can do so  and has expressed interest in the                                                               
project.   He pointed out the  bid process will be  a competitive                                                               
bid process so the ASD must compete with other shipyards.                                                                       
                                                                                                                                
1:11:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ asked what  advantages an Alaskan firm would                                                               
have in the competitive bid process.                                                                                            
                                                                                                                                
MR.  BEEDLE  answered  that  Alaska   firms  will  not  have  any                                                               
advantage.   The bid process is  a federal process so  any Alaska                                                               
preference will not apply.                                                                                                      
                                                                                                                                
REPRESENTATIVE  T.  WILSON  asked  whether the  funding  for  the                                                               
Alaska Class Ferry is all federal funding.                                                                                      
                                                                                                                                
MR. BEEDLE  explained the ACF  project is a combination  of state                                                               
and federal  funding.  The  legislature appropriated  $60 million                                                               
to  the AMHS  Vessel Replacement  Fund.   The  AMHS is  currently                                                               
requesting authority  to spend $60  million in general  fund (GF)                                                               
dollars.    Additionally,  the state  anticipates  receiving  $60                                                               
million in federal funds from  the Federal Highway Administration                                                               
(FHWA).                                                                                                                         
                                                                                                                                
REPRESENTATIVE T. WILSON acknowledged the  state is using some GF                                                               
funds for the ACF project.   She asked whether the restriction on                                                               
the bidder preference is because  some federal funds will also be                                                               
used for the project.                                                                                                           
                                                                                                                                
MR.  BEEDLE agreed  the  restrictions apply  due  to the  federal                                                               
funds.                                                                                                                          
                                                                                                                              
1:12:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG recalled  the state previously purchased                                                               
a vessel  with a foreign hull  and ended up having  problems with                                                               
the  [Merchant  Marine  Act  of  1920] Jones  Act.    He  further                                                               
recalled the state is currently  involved in a lawsuit since some                                                               
things were  not considered in  the vessel design  which resulted                                                               
in issues.   He  asked whether the  AMHS is  considering anything                                                               
that  could go  wrong  with the  new vessel  to  avoid a  similar                                                               
"glitch"  in this  process.   He  would like  to prevent  similar                                                               
problems from occurring, he stated.                                                                                             
                                                                                                                                
MR. BEEDLE related that he  would cover the design details during                                                               
his  presentation.   He offered  some assurances,  such that  the                                                               
engine is  a U.S.  built engine  and the  bow thruster  and other                                                               
equipment  selected are  "tried and  true" products  currently in                                                               
use by  the AMHS.   He  reiterated that the  AMHS has  picked and                                                               
specified "tried and true" equipment for the ACF project.                                                                       
                                                                                                                                
REPRESENTATIVE GRUENBERG  maintained he  would like  this project                                                               
"vetted five ways from Sunday" to  be as certain as possible that                                                               
the  experts  have  reviewed  the  ACF project.    He  asked  for                                                               
assurances from the AMHS that the project is being vetted.                                                                      
                                                                                                                                
MR.  BEEDLE related  that  the  ACF process  is  a design  review                                                               
process, which  is a process  the AMHS has  previously undergone.                                                               
He related that  he "sat in" on the process  to bring in experts.                                                               
"There's  what's  called  a  Black  Ball  Shipping  Company  that                                                               
actually  was the  basic design  that our  Alaska Marine  Highway                                                               
System was built after.  We  brought one of their lead masters up                                                               
to look at  our design and advise  us."  He offered  the value to                                                               
have a for  profit expert to examine and provide  comments on the                                                               
design.   He anticipated one  or more design reviews  will occur.                                                               
He characterized this process as  a "very, very important step to                                                               
the AMHS."   The AMHS  is beginning  to replace the  vessels that                                                               
have worked  very well.   He  said, "We've got  to get  it right.                                                               
You are  correct."  He  offered the AMHS  is using people  in the                                                               
private  sector, with  a  for profit  perspective  to review  the                                                               
proposed vessel design.                                                                                                         
                                                                                                                                
1:16:13 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  asked whether any changes were made  as a result                                                               
of  participation  by  expert   consultations  from  the  private                                                               
sector.                                                                                                                         
                                                                                                                                
MR.  BEEDLE  stated the  feedback  helped,  but  not all  of  the                                                               
suggestions applied  to Alaska  since Lower  48 vessels  may have                                                               
20- 30 minute runs while  Alaska ferries typically have much long                                                               
runs.  Some  Lower 48 companies save money  by reducing amenities                                                               
such  as  providing  comfortable  seats.    The  AMHS  must  also                                                               
consider inclement  weather conditions that can  affect passenger                                                               
safety  and comfort,  which require  additional  amenities.   For                                                               
example, the consultant recommended  the new vessels have limited                                                               
outside  deck space  due to  the high  maintenance costs  to main                                                               
decks that are subject to weather.                                                                                              
                                                                                                                                
1:18:28 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  PETERSEN  recalled  that Tier  III  Environmental                                                               
Protection Agency (EPA) emission standards must apply.                                                                          
                                                                                                                                
MR.  BEEDLE agreed,  relating  that Tier  III  standards are  the                                                               
Environmental  Protection Agency  (EPA) emission  standards.   He                                                               
pointed  out that  currently the  proposed ACF  vessels meet  the                                                               
standards.   In response to Chair  P. Wilson, he offered  that it                                                               
is difficult to predict what  requirements will be adopted by the                                                               
EPA  after  the  Tier  III   standards.    Additionally,  as  new                                                               
standards are developed,  the AMHS has a lag  time for compliance                                                               
since it  must often  wait until  the engine  manufacturer builds                                                               
the parts for compliance.                                                                                                       
                                                                                                                                
REPRESENTATIVE MUNOZ asked whether  fast ferry service is planned                                                               
for Lynn Canal once the ACF vessel is operational.                                                                              
                                                                                                                                
MR. BEEDLE  related when the ACF  is on-line that it  will be the                                                               
dedicated vessel in Lynn Canal.   The fast ferry will serve Sitka                                                               
and Petersburg  during the  summer.   He added  it is  not likely                                                               
that the  mainline ferry will  offload Bellingham  passengers and                                                               
shift  them to  the ACF  to continue  on to  Haines and  Skagway.                                                               
Thus, the Bellingham  boat will still "run up  the channel" since                                                               
40 percent of passengers will want  to continue on to Haines.  He                                                               
reported that  the ACF will  allow the  M/V LeConte to  serve the                                                               
outposts and the FVF Fairweather will serve Sitka.                                                                              
                                                                                                                                
1:21:17 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE GRUENBERG  asked whether the  ACF will be  able to                                                               
fill in when vessels are laid up  since the ACF will not have the                                                               
capacity to overnight.                                                                                                          
                                                                                                                                
MR. BEEDLE offered  his belief that the  biggest challenge facing                                                               
the AMHS  is the M/V Columbia  since it only operates  during the                                                               
summer.   The M/V  Columbia is  tied up for  eight months  of the                                                               
year due to  high operating costs.  The addition  of the ACF will                                                               
allow for better use of the M/V  Columbia.  He noted the need for                                                               
additional ferry  service since the  M/V Matanuska is  booked for                                                               
next two months.  The first step  is to build the ACF, retire one                                                               
of the  "24/7" vessels and  fully utilize the  remaining vessels.                                                               
In further  response to Representative  Gruenberg, he  stated the                                                               
AMHS is working  on the "two ends of the  system" that work well,                                                               
which are  the Juneau to Haines  day ferry run and  the Ketchikan                                                               
to Prince Rupert  ferry run.  The Ketchikan to  Prince Rupert run                                                               
lacks sufficient traffic  demand for the larger  vessel, but must                                                               
contend with  "nasty weather"  so the AMHS  must use  the larger,                                                               
more  costly vessel  on  the run.   He  offered  his belief  that                                                               
several  of the  "24/7"  vessels will  be able  to  "work in  the                                                               
middle" and "do the long haul" as the ACF comes on-line.                                                                        
                                                                                                                                
MR. BEEDLE, in  response to Chair Wilson, explained  that the M/V                                                               
Columbia will operate for a longer  period.  Instead of using the                                                               
M/V Malaspina on  the Bellingham run and having  the M/V Columbia                                                               
tied  up at  the dock,  the M/V  Columbia will  be placed  on the                                                               
Bellingham run.   In further response to Chair  Wilson, he stated                                                               
the AMHS plans to retire one  of the ferries:  the M/V Malaspina,                                                               
M/V Matanuska, or the M/V Taku.   The AMHS will retain the vessel                                                               
that it  determines is the  least expensive and safest  vessel to                                                               
run.   Once  the timeline  for the  Alaska Class  Ferry (ACF)  is                                                               
decided then  the AMHS will assess  the other vessels and  make a                                                               
determination of which ferry to retire.                                                                                         
                                                                                                                                
1:27:31 PM                                                                                                                    
                                                                                                                                
MR. BEEDLE discussed the design status  of the ACF [slide 5].  He                                                               
explained the  rescue boats on the  ACF will be placed  closer to                                                               
the water for  easier deployment.  He stated  the preliminary ACF                                                               
design documents are  located on the AMHS  website, including the                                                               
detailed preliminary  arrangements, mid-ship  sectional drawings,                                                               
and  the propulsion  validation study.   He  reviewed the  vessel                                                               
profile [slide 6].   The ACF will retain the  classic AMHS system                                                               
lines,  including  a  modern wheelhouse  and  hull  design,  twin                                                               
"screws",  a   U.S.  electromotive   diesel  engine   with  5,000                                                               
horsepower  engine.     As   previously  mentioned,   the  vessel                                                               
components are  also Tier  III EPA compliant.   The  bow thruster                                                               
can shift  the vessel in  any direction up  to six knots.   Thus,                                                               
the bow thruster also can act like a "kicker."                                                                                  
                                                                                                                                
1:29:12 PM                                                                                                                    
                                                                                                                                
MR.  BEEDLE   outlined  the  current  galley   and  food  service                                                               
arrangement [slide  7].  The  topside will  be used for  food and                                                               
drinks  that do  not require  preparation while  the inside  area                                                               
will provide  for hot food  preparation.   All of the  chairs and                                                               
seating  remain  available for  use  after  the food  service  is                                                               
closed.  He described the  forward observation lounge arrangement                                                               
[slide  8].    This  vessel  will  also  be  compliant  with  the                                                               
Americans with Disabilities Act (ADA), he stated.                                                                               
                                                                                                                                
MR. BEEDLE explained the convenient  location of elevators, which                                                               
will go  right to the solarium.   This ACF vessel  will have four                                                               
quiet rooms,  equipped with sofas to  accommodate passengers with                                                               
special needs,  such as those  who are convalescing and  must lie                                                               
down.   Additionally, the  quiet rooms could  be used  by parents                                                               
whose  baby or  toddler is  crying, which  will make  travel more                                                               
comfortable  for them  and for  other  passengers.   He hopes  to                                                               
place sample seating at the  Auke Bay Ferry Terminal for testing,                                                               
but relating  the seating  is comfortable.   The AMHS  is working                                                               
with  the manufacturer  on durability  issues.   Family washrooms                                                               
will allow  families to  help small children.   He  remarked that                                                               
people love the solariums on the  current AMHS vessels so the ACF                                                               
will have a solarium equipped with restrooms [slide 9].                                                                         
                                                                                                                                
1:32:30 PM                                                                                                                    
                                                                                                                                
CHAIR  P.  WILSON  recalled  that  tents could  be  used  in  the                                                               
solarium.                                                                                                                       
                                                                                                                                
MR. BEEDLE  agreed.  He commented  that the AMHS is  also working                                                               
to  find a  way  to incorporate  tent tie-downs  for  use on  the                                                               
vessel for the Bellingham run.   The ACF is built to transport 60                                                               
vehicles on the  vehicle deck [slide 10].  The  far right side of                                                               
the vessel  deck will accommodate  a row of cars  with wheelchair                                                               
access.                                                                                                                         
                                                                                                                                
1:34:42 PM                                                                                                                    
                                                                                                                                
MR. BEEDLE  explained the necessity  for restrictions  that apply                                                               
on the vehicle deck.  People  often bring birds or animals on the                                                               
ferry, many  of whom are  enroute to  see a veterinarian.   Thus,                                                               
the mezzanine deck is configured  with a pet room that passengers                                                               
can  access while  the vessel  is underway.   Although  pets must                                                               
stay in  kennels, this  access will allow  people to  visit their                                                               
animals.  The  Lead Master and Port  Stewart provided significant                                                               
input  in the  design and  public comments  were also  considered                                                               
when adding this feature.                                                                                                       
                                                                                                                                
1:36:58 PM                                                                                                                    
                                                                                                                                
MR. BEEDLE discussed the procurement  and design completion phase                                                               
[slide  11].   He explained  the  shipyard will  assist the  AMHS                                                               
during  the  design and  construction  phases  to help  the  AMHS                                                               
reduce design risks and ultimately obtain a better vessel.                                                                      
                                                                                                                                
1:37:43 PM                                                                                                                    
                                                                                                                                
MR. BEEDLE  referred to the  ACF website, which can  provide more                                                               
information  on the  project  [slide  12].   The  website can  be                                                               
accessed via the main AMHS website.   It was developed to provide                                                               
shipyards  and   the  public  who  have   expressed  interest  in                                                               
accessing the details of the ACF project.                                                                                       
                                                                                                                                
1:38:39 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  asked whether the ACF ferries will  cost less to                                                               
operate so over time the state will save GF funds.                                                                              
                                                                                                                                
MR. BEEDLE  replied that  the ACF ferry  operating costs  will be                                                               
$100,000 per  week less  than the  current costs  to run  the M/V                                                               
Malaspina.    Thus, for  the  100  days  that the  M/V  Malaspina                                                               
operates each  week in Lynn  Canal the state will  save $100,000.                                                               
This  ACF  vessel  will  provide more  service  but  the  overall                                                               
financial picture improves  since the ACF vessels  will allow the                                                               
other  ferries  to  be  better  used.    The  general  fund  (GF)                                                               
requirement  will  not immediately  diminish,  but  the ACF  will                                                               
provide  significantly  more  service  for the  same  cost.    In                                                               
further response  to Chair  P. Wilson, he  explained while  it is                                                               
possible  that  the  overall  operating  costs  will  be  reduced                                                               
predicting  the future  is difficult.   The  current AMHS  vessel                                                               
assets are  45-years old  and many factors,  such as  the outcome                                                               
for the Juneau Access Road Project have not yet been determined.                                                                
                                                                                                                                
1:43:19 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON recalled that  the plan included shorter runs and                                                               
connections to roads.                                                                                                           
                                                                                                                                
MR.  BEEDLE agreed  the  plan she  referenced  is definitely  one                                                               
option.   He explained  much will  depend on  the roads  that are                                                               
built,  noting that  it  takes three  or four  years  to build  a                                                               
vessel.  Thus,  it is difficult to predict the  future since many                                                               
factors can affect the overall AMHS system, he stated.                                                                          
                                                                                                                                
1:44:43 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ  recalled a  University of  Alaska Fairbanks                                                               
(UAF) study that  considers the future use of the  AMHS and asked                                                               
whether shorter routes were listed in the document.                                                                             
                                                                                                                                
MR. BEEDLE explained  the UAF study is an  independent study that                                                               
reviewed the AMHS  system but the study was not  designed to tell                                                               
the  AMHS how  to operate.   One  issue that  arose is  the study                                                               
assumed the  Juneau Access  Road would  happen.   It has  not yet                                                               
been built.   He recalled that the UAF study  removed it from its                                                               
assumptions.   In  further response  to Representative  Munoz, he                                                               
reiterated that  the study assumed  the road would happen  and it                                                               
did  not, which  meant  the proposed  road did  not  fit the  UAF                                                               
timeline.                                                                                                                       
                                                                                                                                
1:46:38 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ  asked whether the draft  study will address                                                               
the timeline.                                                                                                                   
                                                                                                                                
MR. BEEDLE  said he thought  the UAF  study will need  to address                                                               
why it did not consider the  Juneau Access Road since the project                                                               
was included in the study's initial scope.                                                                                      
                                                                                                                                
1:47:12 PM                                                                                                                    
                                                                                                                                
CHAIR P. WILSON  asked whether the AMHS terminal  would switch to                                                               
the "end of the road" if the Juneau Access road does get built.                                                                 
                                                                                                                                
MR. BEEDLE  explained that  currently passengers  have difficulty                                                               
with transportation  to and  from the ferry  terminal.   Thus, he                                                               
thought that  buses would have  to serve Berner's Bay  before the                                                               
site could  accommodate any  "walk-ons."   He recalled  a similar                                                               
issue  in Metlakatla  that  arose  when the  U.S.  Army Corps  of                                                               
Engineers built  a road.  While  the AMHS is building  a terminal                                                               
at the  site, the  community of  Metlakatla actually  prefers the                                                               
current  route, he  stated.   He  explained that  issues such  as                                                               
these can arise and must be addressed.                                                                                          
                                                                                                                                
1:49:56 PM                                                                                                                    
                                                                                                                                
MR.  BEEDLE, in  response to  Chair P.  Wilson, related  that the                                                               
Metlakatla ferry  runs five days a  week.  The route  change will                                                               
reduce operating costs by a third.   In further response to Chair                                                               
P. Wilson,  he explained that  the ACF  vessel would run  for 300                                                               
days in  Lynn Canal.  The  LeConte is often sold  out and similar                                                               
traffic  congestion also  occurs  in Prince  William  Sound.   He                                                               
related  that it  is important  to ensure  more vehicle  space is                                                               
available  and to  do  so  will help  the  economic viability  of                                                               
communities.                                                                                                                    
                                                                                                                                
1:52:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  MUNOZ asked  about  Bellingham  lease and  AHMS's                                                               
intention for the southern terminus of the AMHS system.                                                                         
                                                                                                                                
MR. BEEDLE answered recalled that  an increase in funding for the                                                               
lease passed  the legislature.   He  explained that  the facility                                                               
lease in Bellingham is a  15-year lease, but contains a provision                                                               
for a 90-day  "opt out" clause without any penalty.   The opt-out                                                               
clause  is necessary  due  to a  timing issue.    Since the  AMHS                                                               
relies  on  the   state's  budget,  which  is   approved  by  the                                                               
legislature, the AMHS cannot rely on guaranteed funding.                                                                        
                                                                                                                                
CHAIR P. WILSON  asked whether Prince Rupert  is being considered                                                               
as the southern terminus of the AMHS.                                                                                           
                                                                                                                                
MR. BEEDLE  explained that it  is attempting to buy  the property                                                               
at Prince  Rupert, but it  is difficult  to finalize since  it is                                                               
owned by  "the Crown."   He provided a  brief history.   In 1963,                                                               
the Prince  Rupert dock  was built,  which has  deteriorated over                                                               
the  years.   Although emergency  repairs were  performed a  year                                                               
ago, a new dock will need to  be built.  Clearly, the AMHS cannot                                                               
"pull  out"  of  Bellingham  until  the  Prince  Rupert  dock  is                                                               
rebuilt.    He  did  not  envision any  other  facility  that  is                                                               
available could be  used for just one day of  use per week needed                                                               
by the  AMHS.  He  pointed out that  the City of  Bellingham gave                                                               
the AMHS  an excellent rate  on its  20-year lease, but  the fees                                                               
will now increase.   He remarked that the  Bellingham facility is                                                               
only used 52  days a year so  the costs are absorbed  by the City                                                               
of Bellingham.                                                                                                                  
                                                                                                                                
CHAIR  P. WILSON  asked  for  the cost  for  dock replacement  at                                                               
Prince Rupert.                                                                                                                  
                                                                                                                                
MR.  BEEDLE  said he  was  unsure  of  the  total cost  for  dock                                                               
replacement.   He recalled Metlakatla's small  facility will cost                                                               
$8  million to  serve  a  20-car vessel  and  provide a  shelter.                                                               
Prince  Rupert  will require  a  dock,  resurfacing of  the  lot,                                                               
customs infrastructure, and  roughly $6 to $8  million in funding                                                               
to provide shore  side facilities.  In further  response to Chair                                                               
P. Wilson,  he offered  his belief  that $20  million would  be a                                                               
conservative figure.                                                                                                            
                                                                                                                                
1:56:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE MUNOZ  recalled the some tribal  organizations are                                                               
receiving federal funds  for ferry service and  asked whether the                                                               
AMHS worked with tribal officials.                                                                                              
                                                                                                                                
MR.  BEEDLE  recalled  a  presentation  by  tribal  officials  on                                                               
proposed  ferry service.   He  explained that  the AMHS  uses its                                                               
passenger  fare receipts  to provide  one-third of  its operating                                                               
expenses.   He  predicted that  if a  tribal organization  runs a                                                               
system it will be a competing  system and would reduce the AMHS's                                                               
overall  revenue.   He offered  his belief  that if  any proposed                                                               
system does  not connect to  a main  community such as  Juneau or                                                               
Sitka, the ferry's  costs will exceed its revenues.   However, if                                                               
a new  ferry system does  connect to  any of the  major Southeast                                                               
communities,  the AMHS  system will  be adversely  affected.   He                                                               
remarked that Allen Marine, Inc.  currently provides good service                                                               
to  some communities  during the  summer.   He expressed  concern                                                               
over  future funding  of a  new  ferry system  since the  federal                                                               
funding for  tribal organizations will eventually  disappear.  He                                                               
further predicted  that a tribal  organization would  likely need                                                               
to request  future state funding  since operating the  ferry will                                                               
be a "losing proposition."                                                                                                      
                                                                                                                                
1:59:32 PM                                                                                                                    
                                                                                                                                
CHAIR  P. WILSON  recalled  that  the International-Island  ferry                                                               
initially "penciled out" when fuel costs were low.                                                                              
                                                                                                                                
MR. BEEDLE  recalled that initially  the M/V Chilkat was  able to                                                               
fund its operation,  but it did not  receive sufficient passenger                                                               
revenue to pay  for vessel or dock maintenance  and the Territory                                                               
of Alaska had to take eventually take it over.                                                                                  
                                                                                                                                
1:59:58 PM                                                                                                                    
                                                                                                                                
^Status  of Federal  Authorizations  by  Jeff Ottesen,  Director,                                                               
Division of  Program Development, Department of  Transportation &                                                               
Public Facilities                                                                                                               
                                                                                                                                
                                                                                                                                
  Status of Federal Authorizations by Jeff Ottesen, Director,                                                               
Division of Program Development, Department of Transportation &                                                             
                       Public Facilities                                                                                    
                                                                                                                              
CHAIR P. WILSON announced that  the final order of business would                                                               
be  the  Status  of  Federal   Authorizations  by  Jeff  Ottesen,                                                               
Department of Transportation & Public Facilities.                                                                               
                                                                                                                                
2:01:44 PM                                                                                                                    
                                                                                                                                
JEFF   OTTESEN,  Director,   Division  of   Program  Development,                                                               
Department  of  Transportation   &  Public  Facilities  (DOT&PF),                                                               
explained that the  DOT&PF has successfully obligated  all of the                                                               
2009 Stimulus Funds  in the three DOT&PF  categories: Highway and                                                               
Bridge, Aviation,  and Transit.   Alaska  obligated the  funds on                                                               
time, despite  the tight timeframe,  and was the sixth  state for                                                               
the  Highway  and Bridge  category  to  meet  the deadline.    He                                                               
remarked  that all  fifty states  made  the deadline.   A  DOT&PF                                                               
webpage shows  the projects  in the three  categories.   The $260                                                               
million   federal   funding   that  spanned   50   projects   was                                                               
accomplished  in addition  to the  regular DOT&PF  projects.   He                                                               
characterized  meeting the  federal stimulus  requirements as  an                                                               
incredible amount of work.                                                                                                      
                                                                                                                                
2:03:24 PM                                                                                                                    
                                                                                                                                
MR.  OTTESEN  moved  to  update  members  on  the  2010  Stimulus                                                               
Transportation  Funding.   In December  2009, the  U.S. House  of                                                               
Representatives passed a  new "Jobs for Main  Street" bill, which                                                               
was a "redo" of  the 2009 bill.  The bill  passed with one change                                                               
which  required states  to  award the  projects  within 90  days.                                                               
Thus,  the timeframe  was shortened  while the  number of  things                                                               
that  must be  accomplished  increased, he  stated.   The  DOT&PF                                                               
identified  projects   that  were  nearly  ready.     The  DOT&PF                                                               
published  a  State  Transportation  Improvement  Program  (STIP)                                                               
amendment  and began  work on  the list  of projects.   The  U.S.                                                               
Senate did not take up the bill.   The Senate version of the bill                                                               
was a  smaller bill and  did not  contain stimulus projects.   He                                                               
said he heard  rumors of a second jobs bill  being considered but                                                               
the prospect is "dimming" as time passes.                                                                                       
                                                                                                                                
2:05:45 PM                                                                                                                    
                                                                                                                                
CHAIR P.  WILSON asked  whether Alaska  contractors were  able to                                                               
keep up with the projects or if  the state needed to use Lower 48                                                               
contractors.                                                                                                                    
                                                                                                                                
MR. OTTESEN replied  that only a handful of  contractors from the                                                               
Lower 48 were  able to successfully compete,  largely on projects                                                               
for maritime  work such as the  building the Gustavus Dock.   The                                                               
Lower 48  firms that perform  this work are specialists  who have                                                               
previously performed  in Alaska.   Almost all  of the  other work                                                               
was performed  by in  state contractors.   He mentioned  that the                                                               
process included  a pattern of  underbids, or bids which  came in                                                               
below  the  estimate.    This  required  the  DOT&PF  to  request                                                               
additional legislative authority from  the Legislative Budget and                                                               
Audit Committee during the legislative  interim.  He related that                                                               
the DOT&PF is still not finished  with the process.  In instances                                                               
of underbids, the  DOT&PF must release the money and  has 60 days                                                               
to find an eligible project  that meets the federal requirements,                                                               
has legislative  authority, is  contained in  the STIP,  and then                                                               
obligate the  funds.  He  explained the DOT&PF will  probably end                                                               
up  with  "blended projects"  consisting  of  stimulus funds  and                                                               
other federal funds.                                                                                                            
                                                                                                                                
2:08:02 PM                                                                                                                    
                                                                                                                                
MR. OTTESEN  explained that  2009 was  a remarkably  unusual year                                                               
due to the American Recovery  and Reinvestment Act of 2009 (ARRA)                                                               
and since  it was the last  federal fiscal year of  the Safety-Lu                                                               
legislation.  In 2005, the  Congress wrote in a rescission, which                                                               
is  complicated  process but  essentially  represented  a way  to                                                               
"balance the books."   Basically the Congress said  that it would                                                               
provide funding, but in five years  would "take some of the money                                                               
back."  Thus,  the federal government planned to  rescind some of                                                               
the funding.   There were  two legal interpretations of  how that                                                               
would work.   Alaska did  not know  whether it would  receive $50                                                               
million or  $80 million, depending on  which legal interpretation                                                               
prevailed.  In September 2009,  the court settled.  Additionally,                                                               
the FHWA  did not  issue the  rules until  September 2009  so the                                                               
state did  not have "the tools  to proceed."  In  September 2009,                                                               
the matter was  settled.  As it happened, the  state had about 10                                                               
days  to  return $80  million  to  the  federal government.    He                                                               
provided background  on federal  funding process,  explaining the                                                               
obligation and apportionment  limit.  By removing  $80 million in                                                               
apportionment, it  would not leave  the state with enough  to use                                                               
its obligation limit.  The net  result meant the state would lose                                                               
$60  million in  its  overall spending.    However, the  DOT&PF's                                                               
staff  reviewed the  rules and  discovered an  obscure rule  that                                                               
applied.  This reduced the loss  to $15 million.  Thus, the state                                                               
ultimately saved  $45 million in  federal funding.   The Congress                                                               
ultimately passed  four separate  resolutions to extend  the FHWA                                                               
highway funding.   In March, the Congress passed  the Senate Jobs                                                               
Bill,  which fully  funded the  regular 2010  FHWA program.   The                                                               
state  will  receive approximately  $100  million  more than  the                                                               
DOT&PF estimated  in the  STIP.  He  speculated that  overall the                                                               
state  would receive  $400 million  in FHWA  funds.   However, he                                                               
cautioned  that the  DOT&PF must  award the  funding within  five                                                               
months.                                                                                                                         
                                                                                                                                
2:12:04 PM                                                                                                                    
                                                                                                                                
MR.  OTTESEN  related that  the  DOT&PF  is taking  the  projects                                                               
identified  in December,  the "Stimulus  Round II  projects," and                                                               
will shift  them to regular  STIP projects since they  are "ready                                                               
to go."   The CIB amendment  will reflect the projects,  he said.                                                               
He   explained  that   "getting  ready   for  stimulus"   funding                                                               
ultimately  helped  the state  receive  additional  funding.   He                                                               
reported that  this information is a  tentative interpretation of                                                               
the funding since the federal  government's table of notices will                                                               
be issued  in another ten days.   He offered his  belief that his                                                               
estimate is fairly  accurate and will be within a  percent or two                                                               
of the  actual federal funding.   The  end result is  that Alaska                                                               
will have  a "pretty healthy 2010"  which is almost equal  to the                                                               
2009  federal  funds, including  the  2009  stimulus funds.    He                                                               
pointed out the possibility of  additional stimulus funds, but he                                                               
thought that is unlikely.                                                                                                       
                                                                                                                                
2:13:36 PM                                                                                                                    
                                                                                                                                
MR. OTTESEN,  in response to Chair  P. Wilson, offered a  list of                                                               
2010  projects.   He related  that the  list is  contained in  an                                                               
amendment to  the proposed state  Capital Budget.  He  named some                                                               
projects that are included in  the bill, including Victor Road in                                                               
Anchorage,  the  Fairbanks   FMATS,  resurfacing  outside  Palmer                                                               
towards Glennallen,  signage on the  Glenn Highway, a  small boat                                                               
float at Gustavus, North Douglas  re-pavement, and King Cove road                                                               
work.  He related that the  projects were selected since they are                                                               
"ready to  go" and must be  obligated or the state  will lose the                                                               
funds.                                                                                                                          
                                                                                                                                
2:17:29 PM                                                                                                                    
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Transportation Standing  Committee meeting was adjourned  at 2:17                                                               
p.m.                                                                                                                            

Document Name Date/Time Subjects