Legislature(2013 - 2014)SENATE FINANCE 532

01/22/2013 01:00 PM House TRANSPORTATION


Download Mp3. <- Right click and save file as

Audio Topic
01:02:32 PM Start
01:06:18 PM Presentations: Department of Transportation and Public Facilities (dotpf) Overview on Surface Transportation, Roads to Resources, and Map-21
03:03:41 PM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Location Change --
Joint w/ Senate TRA
+ - Overview: Dept. of Transportation & Public TELECONFERENCED
Facilities (DOT) by Commissioner Pat Kemp
- Surface Transportation (incl. Roads to
Resources) by DOT
- Map-21 Presentation by DOT
                    ALASKA STATE LEGISLATURE                                                                                  
                         JOINT MEETING                                                                                        
            SENATE TRANSPORTATION STANDING COMMITTEE                                                                          
            HOUSE TRANSPORTATION STANDING COMMITTEE                                                                           
                        January 22, 2013                                                                                        
                           1:02 p.m.                                                                                            
                                                                                                                                
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
SENATE TRANSPORTATION                                                                                                           
                                                                                                                                
 Senator Dennis Egan, Chair                                                                                                     
 Senator Fred Dyson, Vice Chair                                                                                                 
 Senator Anna Fairclough                                                                                                        
 Senator Click Bishop                                                                                                           
                                                                                                                                
HOUSE TRANSPORTATION                                                                                                            
                                                                                                                                
 Representative Peggy Wilson, Chair                                                                                             
 Representative Doug Isaacson, Vice Chair                                                                                       
 Representative Eric Feige                                                                                                      
 Representative Lynn Gattis                                                                                                     
 Representative Bob Lynn                                                                                                        
 Representative Jonathan Kreiss-Tomkins                                                                                         
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
SENATE TRANSPORTATION                                                                                                           
                                                                                                                                
 Senator Hollis French                                                                                                          
                                                                                                                                
HOUSE TRANSPORTATION                                                                                                            
                                                                                                                                
 Representative Craig Johnson                                                                                                   
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                              
Presentation: Department of Transportation and Public Facilities                                                                
(DOTPF) overview on surface transportation                                                                                      
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
Presentation: MAP-21                                                                                                            
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
Presentation: Roads to Resources                                                                                                
                                                                                                                                
     - HEARD                                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
No previous action to consider                                                                                                  
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
KIM RICE, Deputy Commissioner                                                                                                   
Department  of  Transportation   and  Public  Facilities  (DOTPF)                                                               
Juneau, Alaska                                                                                                                  
POSITION    STATEMENT:   Provided    presentation   on    surface                                                             
transportation issues.                                                                                                          
                                                                                                                                
MIKE VIGUE, Operations Manager                                                                                                  
Division of Program Development                                                                                                 
Department  of  Transportation   and  Public  Facilities  (DOTPF)                                                               
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Provided presentation on MAP-21.                                                                          
                                                                                                                                
JEFF OTTESEN, Director                                                                                                          
Division of Program Development                                                                                                 
Department of Transportation and Public Facilities (DOTPF)                                                                      
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:  Provided  financial  background  and  other                                                             
commentary related to the MAP-21 presentation.                                                                                  
                                                                                                                                
MURRAY WALSH,  Special Assistant to the  Commissioner and Manager                                                               
Road to Resources                                                                                                               
Department of Transportation and Public Facilities (DOTPF)                                                                      
Juneau, Alaska                                                                                                                  
POSITION  STATEMENT:  Provided  presentation   on  the  Roads  to                                                             
Resources initiative.                                                                                                           
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
1:02:32 PM                                                                                                                    
CHAIR  DENNIS EGAN  called the  joint meeting  of the  Senate and                                                             
House Transportation  Standing Committees  to order at  1:02 p.m.                                                               
Present at  the call  to order  were Senators  Dyson, Fairclough,                                                               
Bishop and  Chair Egan; Representatives Isaacson,  Feige, Gattis,                                                               
Kreiss-Tomkins and Chair Peggy Wilson.                                                                                          
                                                                                                                                
^Presentations:   Department   of   Transportation   and   Public                                                               
Facilities (DOTPF)  Overview on Surface Transportation,  Roads to                                                               
Resources, and MAP-21                                                                                                           
                                                                                                                                
           Presentation: Department of Transportation                                                                       
            and Public Facilities (DOTPF)Overview on                                                                        
     Surface Transportation, Roads to Resources, and MAP-21                                                                 
                                                                                                                                
1:06:18 PM                                                                                                                    
CHAIR EGAN  said the first  presentation would be an  overview of                                                               
surface transportation  by the  Department of  Transportation and                                                               
Public Facilities' deputy commissioner Kim Rice.                                                                                
                                                                                                                                
1:06:41 PM                                                                                                                    
KIM RICE,  Deputy Commissioner, Department of  Transportation and                                                               
Public Facilities (DOTPF), Juneau,  Alaska, gave her professional                                                               
background  saying she  graduated from  the University  of Alaska                                                               
Fairbanks (UAF) and had been  with department since 1979, but had                                                               
first started working  with the state in 1973 as  a file clerk at                                                               
the Ferry  System. She  had also  worked in  the department  as a                                                               
bridge   engineer,    project   manager,    right-or-way   chief,                                                               
preconstruction  engineer and,  most  recently,  director of  the                                                               
Division of Design and Construction.                                                                                            
                                                                                                                                
In providing  an overview  of the highways,  she said  her intent                                                               
was  to cover  their  undergirding statutes,  their mission,  how                                                               
they  are organized  and  where  they are  on  their capital  and                                                               
operating  budgets; she  would also  talk about  the department's                                                               
strengths and challenges.                                                                                                       
                                                                                                                                
1:08:40 PM                                                                                                                    
MS.  RICE  said the  department  plans,  designs, constructs  and                                                               
maintains  all  state  modes of  transportation  and  facilities.                                                               
Their mission is in  Title 44, but Title 19 tells  them how to do                                                               
their  job. Their  mission is  broader than  most other  states'.                                                               
Their  purpose  as a  highway  department  is  to be  capable  of                                                               
carrying  out a  highway planning,  construction and  maintenance                                                               
program.  They  are  responsible  for  the  network  of  highways                                                               
linking  together cities  and communities  throughout the  state.                                                               
They  support the  development of  commerce and  industry in  the                                                               
state as well as extraction  and utilization of its resources and                                                               
providing access to its citizens.                                                                                               
                                                                                                                                
1:10:00 PM                                                                                                                    
Because the department uses so  much federal funding, the Code of                                                               
Federal Regulations  in Title 23  undergirds and guides a  lot of                                                               
their  processes. As  she rose  up  in the  department, Ms.  Rice                                                               
remarked  that she  knew  more  about what  was  in  the Code  of                                                               
Federal Regulations  than she  needed to know  about what  was in                                                               
Title 19 in order to keep them out of trouble.                                                                                  
                                                                                                                                
MS.  RICE said  the department's  mission is  to provide  for the                                                               
safe and efficient moving of  people and goods, to provide access                                                               
to state services  and to open opportunities  for exploration and                                                               
development.  She emphasized  that she  liked the  word "service"                                                               
because  it   meant  serving  the   people  and   developing  the                                                               
infrastructure that provides access for them.                                                                                   
                                                                                                                                
1:11:16 PM                                                                                                                    
She said  over the last  few years they had  spent a lot  of time                                                               
thinking about "core values" and  realized that one of the things                                                               
that  has kept  her at  the department  is the  integrity of  the                                                               
people  she  works  with.  Positive   regard  for  colleagues  is                                                               
encouraged there as well as serving the public.                                                                                 
                                                                                                                                
She  explained  that  the  department is  arranged  in  two  main                                                               
pieces:  regions and  headquarters. Headquarters  is the  policy,                                                               
procedures and  broad programs  and program  development. Regions                                                               
are  the boots  on  the ground:  maintaining  roads and  building                                                               
projects.  The groups  interface  so what  one  does affects  the                                                               
other.                                                                                                                          
                                                                                                                                
1:13:21 PM                                                                                                                    
MS. RICE said  the state has three  geographic regions: Northern,                                                               
Central and Southeast.  The Northern Region has  the largest land                                                               
mass  and  the  most  roads;  the Central  Region  has  the  most                                                               
population  and  the most  dual  lanes  and traffic  volumes  and                                                               
Southeast  has the  Marine  Highways and  ports.  Each region  is                                                               
structured differently.                                                                                                         
                                                                                                                                
The  state national  highway system  (NHS) has  2,577 center-line                                                               
miles of  road. She explained  that Alaska has an  exemption from                                                               
meeting the  interstate standards,  but their  goal should  be to                                                               
bring  that road  up to  those standards  for the  safety of  the                                                               
traveling public.  Overall, DOTPF  owns and maintains 5,601 miles                                                               
of  roads/highways varying  from  interstate  type facilities  to                                                               
two-lane dirt roads, 805 bridges and 7 weigh stations.                                                                          
                                                                                                                                
She said  that federal  regulation requires  them to  inspect all                                                               
the public  highway bridges  in the state  every two  years. They                                                               
have 84 statewide maintenance stations,  some of which are shared                                                               
with other  facilities (air  transportation, surface  and water),                                                               
and there is an advantage to  creating a main DOT over individual                                                               
departments,  because  for example,  in  many  villages the  same                                                               
person plowing your street may also plow your airport.                                                                          
                                                                                                                                
MS.  RICE said  this  year's proposed  operating  budget is  $635                                                               
million. About 20  percent of that is direct boots  on the ground                                                               
highway maintenance  money that is tracked  through H&A (Highways                                                               
and Aviation). Their  capital budget is close to  $1 million. The                                                               
highway program  itself is proposed  to be $.5 million  (just the                                                               
federal aid program not including the state capital program).                                                                   
                                                                                                                                
1:17:41 PM                                                                                                                    
She showed a  distribution graph showing how  federal funding has                                                               
fluctuated  over the  years, but  said that  overall the  capital                                                               
program is close  to $.5 billion annually. To  her knowledge, Ms.                                                               
Rice  said they  had not  turned back  any money  to the  federal                                                               
government,   but  they   had  returned   money   to  the   state                                                               
legislature.  They are  always told  getting the  program out  is                                                               
their number one mission and their  number one job, and they have                                                               
been  highly  successful  at  that  even  though  they  have  the                                                               
greatest challenges  in terms of climate  and weather conditions.                                                               
For  example she  flew to  Juneau last  night, only  she went  to                                                               
Sitka  instead and  came back  this morning.  That's the  kind of                                                               
stuff their contractors and engineers  have to deal with, but she                                                               
believed  the  department  has  the  competence  to  deliver  its                                                               
programs and she appreciated the opportunity to serve.                                                                          
                                                                                                                                
MS. RICE said they always have challenges:                                                                                      
   · Balancing the budget while trying to meet all the needs                                                                    
     that  are   out  there,  despite  changing   conditions  and                                                               
     expectations.  "Scope  creep"  is common  because  there  is                                                               
     always  something  more that  can  be  fixed while  you  are                                                               
     there.                                                                                                                     
   · Capital dollars are very dependent upon federal funds;                                                                     
     dollars are not indexed to need or construction cost. Not                                                                  
     being met:                                                                                                                 
     -Rural essential needs                                                                                                     
     -Population growth demands                                                                                                 
     -Safety issues                                                                                                             
   · Staffing and aging workforce issue (retirement of the baby                                                                 
     boomers)                                                                                                                   
   · Environmental issues continue to grow; new issues are being                                                                
     raised and longer process timelines are needed (time is                                                                    
     money in the development process).                                                                                         
                                                                                                                                
1:21:52 PM                                                                                                                    
MS.  RICE showed  a slide  of the  many federal  regulations that                                                               
have to be addressed while  doing project and program development                                                               
saying that MAP-21 can now be added to that.                                                                                    
                                                                                                                                
1:22:21 PM                                                                                                                    
SENATOR  BISHOP congratulated  her  on her  new  position in  the                                                               
department. He said  his pet peeve was "mission  creep" and asked                                                               
if going  through all these  protocols adds  to the value  of the                                                               
asphalt. From  1900 to 1960 the  state had five agencies  and now                                                               
there are over 70 checks and  balances; the state could get a lot                                                               
more  bang  for  its  buck  and more  lane  miles  paved  if  the                                                               
regulatory process could be streamlined.                                                                                        
                                                                                                                                
MS. RICE said the biggest  challenge and opportunity they face is                                                               
the  new federal  authorization. She  explained that  a new  bill                                                               
comes out every  six years. She provided website  links for DOTPF                                                               
information  sources saying  there was  a list  of projects  with                                                               
websites on the DOT website.                                                                                                    
                                                                                                                                
1:24:30 PM                                                                                                                    
SENATOR DYSON thanked  her for her presentation and  asked if the                                                               
permafrost  temperature is  rising  and if  the  roads are  being                                                               
degraded in  the Northern Region because  of it. He was  glad she                                                               
was paying attention.                                                                                                           
                                                                                                                                
MS. RICE replied that she had  seen a couple of pictures recently                                                               
that people are attributing to  that possibility. She had read it                                                               
had  gone  up a  half  degree,  but  she  wasn't an  expert.  The                                                               
permafrost  base is  being monitored  and people  speculate about                                                               
what will happen to the road bases if the permafrost melts.                                                                     
                                                                                                                                
1:27:46 PM                                                                                                                    
MIKE VIGUE, Operations Manager,  Division of Program Development,                                                               
Department  of  Transportation  and  Public  Facilities  (DOTPF),                                                               
Juneau, AK, introduced himself.                                                                                                 
                                                                                                                                
JEFF   OTTESEN,  Director,   Division  of   Program  Development,                                                               
Department  of  Transportation  and  Public  Facilities  (DOTPF),                                                               
Juneau, AK, briefed  the committee on Mr.  Vigue's background. He                                                               
came to them about three years  ago from the State of Maine where                                                               
he  worked   for  the  Federal  Highway   Administration  as  the                                                               
financial officer;  prior to that he  was with Maine DOT  and ran                                                               
their  Transportation  and   Community  and  System  Preservation                                                               
(TCSP) program. Prior to that he  was with Alaska DOT and was one                                                               
of their junior  planners. He has had quite a  lot of experience,                                                               
especially with Federal  Highways and the state is  lucky to have                                                               
him.                                                                                                                            
                                                                                                                                
MR.  VIGUE said  he  would  provide an  overview  of MAP-21,  the                                                               
current federal  transportation policy  that became  effective on                                                               
October 1,  2013. It's  a two-year  bill, which  is a  little bit                                                               
different than  the five-year  bills in the  past: passed  in the                                                               
90s,  ISTEA was  for six  years; TEA-21  was for  five years  and                                                               
SAFETEA-LU was  for five years. Now  we have MAP-21 for  only two                                                               
years. It  gives the state some  stability but not as  much as in                                                               
the past.                                                                                                                       
                                                                                                                                
1:30:42 PM                                                                                                                    
Slide 4 indicated  annual funding levels provided  by Congress to                                                               
the state through the  Federal Highway Administration. SAFETEA-LU                                                               
was in purple; the blue  column showed formula funding, money the                                                               
state of  Alaska gets based  on number of vehicle  miles traveled                                                               
and  contributions to  the Federal  Highway Trust  Fund based  on                                                               
fuel taxes; and the red was earmarks and set-aside funds.                                                                       
                                                                                                                                
1:32:07 PM                                                                                                                    
SENATOR  DYSON remembered  significant  financial constraints  in                                                               
2005 and said he suspected  there was a pretty strong correlation                                                               
between oil prices and the budget deficit/surplus.                                                                              
                                                                                                                                
1:33:03 PM                                                                                                                    
MR. VIGUE  said one of the  reasons MAP-21 is a  two-year bill is                                                               
that Congress was  unable to solve the problem of  revenue in the                                                               
Highway  Trust Fund.  So it  relies  on general  fund (GF)  money                                                               
being transferred  from the  US Treasury  into the  Highway Trust                                                               
Fund in  addition to the surplus  in the account for  the leaking                                                               
underground storage tanks.  For the two years,  about $19 billion                                                               
had to be  transferred from sources outside of  the Highway Trust                                                               
Fund into  it to  balance the  bill. Congress had  to do  that in                                                               
2006 and 2008, also, because the  Highway Trust Fund did not have                                                               
enough  money to  sustain the  level of  funding that  SAFETEA-LU                                                               
provided. He said  MAP-21 has significant new  policies and cited                                                               
streamlining in  program areas  and in the  way funding  comes to                                                               
the department as examples.                                                                                                     
                                                                                                                                
1:34:24 PM                                                                                                                    
MR. VIGUE said the highest  amount of funding Alaska received for                                                               
one year was  $520 million and they are looking  at getting about                                                               
$485  million for  2013 and  expecting a  very small  increase to                                                               
maybe  $488 or  $490 million  in 2014.  He reported  that transit                                                               
funding was  about $4 million less  in 2013 than in  2012. In the                                                               
past,  Alaska had  received a  set-aside of  $10 million  for the                                                               
Ferry  program, and  that went  away. A  new formula  was put  in                                                               
place, but they didn't know what the results of it would be.                                                                    
                                                                                                                                
CHAIR EGAN asked how the  Vessel Replacement Fund gets integrated                                                               
with that.  He thought  there had  been a  federal match  at some                                                               
point in time.                                                                                                                  
                                                                                                                                
MR. OTTESEN explained  that the Vessel Replacement  Fund has been                                                               
used as a  source of general funds for a  general fund ferry that                                                               
was not following  federal rules, so there were  no federal funds                                                               
involved in those decisions at all.                                                                                             
                                                                                                                                
MR.  VIGUE said  the  money  the state  is  getting from  federal                                                               
Highways has done a lot of  the smaller projects the ferry system                                                               
needs like maintaining terminals  and repairing vessels. He noted                                                               
that  they had  recently put  out a  bid for  repowering the  M/V                                                               
Columbia.                                                                                                                       
                                                                                                                                
CHAIR PEGGY WILSON  explained that the reason the  state had used                                                               
general funds  instead of  federal funds is  because it  could be                                                               
done cheaper and with less red tape.                                                                                            
                                                                                                                                
MR. OTTESEN  added that when  you don't use federal  funds you're                                                               
not stuck with  the federal rule book and you  can do procurement                                                               
favoring Alaskan vendors like the Ketchikan Shipyard.                                                                           
                                                                                                                                
MR. VIGUE  said they had noticed  that MAP-21 was a  resetting of                                                               
the  federal  priorities  putting   much  more  emphasis  on  the                                                               
national highway system  (NHS). A new program  was created called                                                               
the National  Highway Performance  Program (NHPP). He  added that                                                               
slightly less than 60 percent  of our federal money was dedicated                                                               
to  the   National  Highway  System  (NHS);   that  includes  the                                                               
interstate  system, the  National  Highway  System and  Strategic                                                               
Highway   Network,  and   multi-modal  connectors   that  connect                                                               
airports to ports and that sort of thing.                                                                                       
                                                                                                                                
He said  the Highway  Safety Program has  almost doubled  in size                                                               
and has  new performance  standards under  the NHPP.  The Federal                                                               
Highway   Administration  has   started  to   reach  out   to  an                                                               
organization of all  the states to put some meat  on the bones of                                                               
what the performance  standards will be. And there  has been more                                                               
focus on the  urban areas with populations  greater than 200,000,                                                               
which in Alaska means the Anchorage area.                                                                                       
                                                                                                                                
1:39:00 PM                                                                                                                    
REPRESENTATIVE ISAACSON  asked if  this bill  will be  stable for                                                               
two years or will it go down next year.                                                                                         
                                                                                                                                
MR. VIGUE  answered that  it will  be stable  for two  years; the                                                               
department  will get  funding in  2014  that is  very similar  to                                                               
2013. Anything past that is an uncertainty.                                                                                     
                                                                                                                                
REPRESENTATIVE ISAACSON  said to  him MAP-21 represents  a threat                                                               
to the DOT's  ability to meet the needs of  projects on the plate                                                               
now and  asked if the legislature  has to do something  this year                                                               
to allow them to make more efficient use of the money.                                                                          
                                                                                                                                
MR. VIGUE said that MAP-21 is  a stop-gap that Congress will have                                                               
to address  because there are  a huge  number of needs  out there                                                               
and not nearly enough funding to cover them all.                                                                                
                                                                                                                                
MR. OTTESEN said  the Highway Trust Fund  is predominantly funded                                                               
through  gasoline and  diesel taxes  and because  of ever  higher                                                               
standards for  mileage and moving  to alternative fuels,  the tax                                                               
yield  per vehicle  is  going down.  Conversely,  there are  more                                                               
vehicles producing wear and tear  on the highway system. So there                                                               
is a  disconnect between the  use of  the system and  the funding                                                               
stream for the Highway Trust Fund.                                                                                              
                                                                                                                                
CHAIR EGAN  asked if Alaska  has one of  the lowest gas  taxes in                                                               
the nation.                                                                                                                     
                                                                                                                                
MR.  OTTESEN  answered  yes,  but there  is  no  real  connection                                                               
between a  state gas tax dollar  and what comes to  DOTPF. He was                                                               
speaking to the Highway Trust  Fund and the federal component tax                                                               
that feeds it.  The state gas tax goes into  the general fund and                                                               
doesn't come into the program directly.                                                                                         
                                                                                                                                
1:44:42 PM                                                                                                                    
REPRESENTATIVE KREISS-TOMKINS  asked if the state  had considered                                                               
a vehicle miles traveled (VMT) tax structure.                                                                                   
                                                                                                                                
MR.  OTTESEN replied  no, but  several other  states are  looking                                                               
into that  idea. Oregon  is the  leader in finding  a new  way to                                                               
measure the use of the highway system in order to charge a fee.                                                                 
                                                                                                                                
1:45:28 PM                                                                                                                    
MR. VIGUE  said MAP-21 narrowed funding  to go to the  NHS but at                                                               
the same time they also  expanded the system to include principal                                                               
arterials,  a functional  class  of  how a  road  is expected  to                                                               
operate, and  that added  90 miles to  the mileage  attributed to                                                               
the Alaska  NHS. That is  important, because part of  the funding                                                               
formula  is the  number of  lane miles  on the  NHS. So  the more                                                               
lanes you have, in theory, the  more funding you will get. Fifty-                                                               
seven percent of our federal funding  is dedicated to the NHS; 27                                                               
percent  is focused  on lower  tier roads,  which means  anything                                                               
under  a principal  arterial such  as miner  arterial or  a major                                                               
collector. He said a  lot of the roads in Juneau  are not NHS. So                                                               
a significant  number of miles  have a smaller amount  of funding                                                               
available for them.                                                                                                             
                                                                                                                                
He said 7 percent of the  funding is directed to safety under the                                                               
Highway Safety  Improvement Program,  and that almost  doubled in                                                               
size from  SAFETY-LU to MAP-21.  In addition, there  are sanction                                                               
funds,  which means  that  because Alaska  doesn't  have an  open                                                               
container law and  a repeat offender law it  gets sanctioned, the                                                               
sanction being  that NHS and  STP funds  go over to  safety. That                                                               
almost  doubles the  safety program  again,  so it  will be  very                                                               
large in the next few years.                                                                                                    
                                                                                                                                
CHAIR  PEGGY WILSON  asked  how  much money  would  be gained  by                                                               
putting those laws in place.                                                                                                    
                                                                                                                                
MR. OTTESEN answered  that the sanction doesn't  take money away;                                                               
it changes the  program it goes to. If Alaska  changed its safety                                                               
laws to  match the  federal requirement, it  would remain  in the                                                               
two other categories of STP and NHS, which get 5 percent each.                                                                  
                                                                                                                                
CHAIR EGAN asked if Egan Drive is a lower tier road.                                                                            
                                                                                                                                
MR. OTTESEN  answered no; it  is part of  the NHS. So,  it's well                                                               
funded. Douglas  Highway is  a lower tier  road as  is Mendenhall                                                               
Loop and Glacier Highway until you get to Don Abel's.                                                                           
                                                                                                                                
MR. VIGUE  said the sanction  money amounts to about  $22 million                                                               
annually. He  showed a map of  NHS in Alaska giving  them an idea                                                               
of what  is eligible for  those NHS  dollars. A pie  chart showed                                                               
$237 million in  NHS funding for 2013 on one  side and 2577 miles                                                               
of NHS road  on the other indicating that 18  percent of the road                                                               
miles were getting 57 percent of  the money. The next largest pot                                                               
was  Surface   Transportation  Program  (STP)  funding   at  $109                                                               
million;  the  smaller  pots  of funding  were  for  things  like                                                               
safety,  congestion   mitigation,  air  quality,   planning,  and                                                               
transportation alternatives.                                                                                                    
                                                                                                                                
1:51:09 PM                                                                                                                    
REPRESENTATIVE  ISAACSON  asked if  that  50  percent of  federal                                                               
funding is still constrained to the 18 percent of our roads.                                                                    
                                                                                                                                
MR. VIGUE answered  yes, but this doesn't deal with  the roads to                                                               
resources program,  which has been  funded with just  state money                                                               
so far.                                                                                                                         
                                                                                                                                
REPRESENTATIVE  ISAACSON said  he just  wanted to  make it  clear                                                               
that  all local  roads are  not receiving  the federal  money. If                                                               
we're receiving  57 percent federal  funding, that would  free up                                                               
some state money to be leveraged for state roads.                                                                               
                                                                                                                                
MR. VIGUE responded that would be possible.                                                                                     
                                                                                                                                
CHAIR  EGAN asked  how a  community  like Elfin  Cove, Angoon  or                                                               
Tenakee fits in.                                                                                                                
                                                                                                                                
MR.  VIGUE  asked him  to  hold  on  to  that question  while  he                                                               
explained the  allocation for STP.  In the past these  funds were                                                               
received  in  one pot,  and  they  could  be allocated  based  on                                                               
priorities. So, to  answer his question there is a  process to be                                                               
followed  in  putting  the  STP  together  where  their  regional                                                               
planners go  out to  the municipalities  and the  communities and                                                               
ask for solicitation of project  proposals. A village like Angoon                                                               
would  fill out  a  form for  a project  proposal  and work  with                                                               
regional  planners  to make  sure  everything  was correct;  that                                                               
project would get  scored against other similar  projects using a                                                               
criterion that is  set out in state regulation.  The projects get                                                               
ranked by score,  and projects are selected based  on the highest                                                               
score and  how much funding  is available. That process  is still                                                               
in  place; the  only dilemma  is that  they have  less money  now                                                               
because  of  the  way  MAP-21   is  structured  (less  STP  money                                                               
available to fund those kinds of projects).                                                                                     
                                                                                                                                
He  explained  that  MAP-21  also takes  away  a  provision  that                                                               
exempted Alaska and Hawaii from  having to sub-allocate STP money                                                               
by population. Now  only 50 percent of the money  is flexible for                                                               
any  area in  the state  and then  four other  pots of  money are                                                               
based on  population. The  funding categories  are: for  areas of                                                               
population greater  than 200,000 (Anchorage), for  places greater                                                               
than 5,000  but less than  200,000 (Fairbanks,  Juneau, Soldotna,                                                               
Ketchikan,  Kodiak, Sitka  and Palmer/Wasilla),  and $21  million                                                               
for places less than 5,000 (a huge area of the state).                                                                          
                                                                                                                                
1:56:03 PM                                                                                                                    
CHAIR  EGAN asked  if Petersburg  that has  2,000 residents,  and                                                               
Skagway and Tenakee  with 100 residents would all be  in the same                                                               
pot.                                                                                                                            
                                                                                                                                
MR. VIGUE answered yes.                                                                                                         
                                                                                                                                
MR. OTTESEN added that nearly  200,000 miles of state highway are                                                               
in that same pot along with  over half the bridges and many ferry                                                               
terminals. So,  it's a  huge list of  needs competing  for hardly                                                               
enough money to do two or three significant projects.                                                                           
                                                                                                                                
CHAIR  EGAN  asked  if  that   was  all  because  of  the  MAP-21                                                               
legislation.                                                                                                                    
                                                                                                                                
MR.  OTTESEN replied  it  is  for two  reasons:  one  is that  it                                                               
reduced the amount  of money going to STP in  general and because                                                               
it  then further  subdivided it  by these  population definitions                                                               
which had never been in place before.                                                                                           
                                                                                                                                
1:57:28 PM                                                                                                                    
CHAIR PEGGY  WILSON asked if  the feds do  Anchorage Metropolitan                                                               
Area  Transportation System  (AMATS)  and Fairbanks  Metropolitan                                                               
Transportation   System   (FMATS)    for   towns   with   certain                                                               
populations.                                                                                                                    
                                                                                                                                
1:57:34 PM                                                                                                                    
MR.  VIGUE  responded  that   the  federal  legislation  requires                                                               
allowing  large   urban  areas  to  form   Metropolitan  Planning                                                               
Organizations  (MPO)   so  Anchorage   named  itself   AMATS  and                                                               
Fairbanks named  itself FMATS. But in  federal language Anchorage                                                               
is   a  Transportation   Management   Area,  which   is  like   a                                                               
metropolitan planning  organization on  steroids, and  only FMATS                                                               
is   an  official   MPO.  Previous   authorizing  language   used                                                               
populations  of  50,000  or  more.  That is  why  Juneau  with  a                                                               
population  of 30,000  was  turned  down when  it  tried to  form                                                               
JMATS.                                                                                                                          
                                                                                                                                
AMATS has been around for a  while and FMATS was created after T-                                                               
21 in the  early 2000s. Federal law provides MPO  funds for those                                                               
organizations to do regional planning.                                                                                          
                                                                                                                                
1:58:51 PM                                                                                                                    
REPRESENTATIVE  FIEGE asked  if the  funding has  fluctuated from                                                               
less  intensive management  to more  intensive management  on the                                                               
part  of  the  feds  or   does  MAP-21  represent  an  increasing                                                               
willingness  on  the part  of  the  federal government  to  micro                                                               
manage how Alaska spends its highway dollars.                                                                                   
                                                                                                                                
MR. VIGUE replied  that he thought MAP-21 was a  restating of the                                                               
federal priority towards the NHS.  He explained that the original                                                               
concept  of  building  the Interstate  System  was  for  national                                                               
defense; so  the National Highway  Performance Program  (NHPP) is                                                               
designed to  maintain the  Interstate System,  the NHS  (which is                                                               
supposed   to    be   connecting    the   different    modes   of                                                               
transportation), and  the Strategic  Highway Network  (a national                                                               
defense  network for  the Department  of Defense).  As they  have                                                               
shifted towards the NHS and safety,  the change in funding can be                                                               
seen. The  feds also want  more oversight and have  increased the                                                               
amount of data reporting required by the state.                                                                                 
                                                                                                                                
REPRESENTATIVE FIEGE asked  with less money coming  from the feds                                                               
in mind,  if there is  enough money in  the state budget  for the                                                               
state to backfill some areas  that aren't getting as much federal                                                               
funding because of the new allocation.                                                                                          
                                                                                                                                
MR. OTTESEN answered  that Commissioner Kemp said  last week that                                                               
their  greatest challenge  is dealing  with the  shortfall as  it                                                               
relates to STP funding to  local governments. And the DOT doesn't                                                               
have another  source of money to  turn to to solve  that problem;                                                               
that  is the  province  of  the legislature.  They  don't have  a                                                               
solution but wanted to bring it  to their attention. The last STP                                                               
was  so different  that the  state did  not call  communities for                                                               
nominations because it  didn't have the financial  capacity to do                                                               
justice to them.                                                                                                                
                                                                                                                                
2:03:09 PM                                                                                                                    
SENATOR FAIRCLOUGH asked  if there are more than two  MPOs and if                                                               
the MatSu qualified under the previous criterion.                                                                               
                                                                                                                                
MR.  OTTESEN answered  no and  explained that  the Census  Bureau                                                               
determines whether  or not there  are new  MPOs when it  does its                                                               
10-year  census.  It's   a  function  of  two   numbers:  one  is                                                               
population  and  the other  is  density,  and MatSu  does  exceed                                                               
50,000, but they  don't have the density needed  to qualify. They                                                               
probably will after the 2020 census.                                                                                            
                                                                                                                                
SENATOR  FAIRCLOUGH said  there is  no  new money  for MPOs;  the                                                               
State  of Alaska  is given  a sum  and a  percentage goes  to the                                                               
MPOs.                                                                                                                           
                                                                                                                                
MR.  OTTESEN answered  that was  correct and  explained that  the                                                               
slice on  the chart  for places  between 5,000  and 200,000  is a                                                               
little  under $16  million and  half of  that goes  to Fairbanks,                                                               
because they  are an MPO. The  other communities on the  list are                                                               
basically  competing  for that  money  through  the STP  process.                                                               
Simple  math  indicates  there  is   less  than  $1  million  per                                                               
community per  year, and  many of those  communities are  used to                                                               
getting $6 to $8 million a year out of the STP.                                                                                 
                                                                                                                                
SENATOR FAIRCLOUGH  said her  point was that  our country  is $16                                                               
trillion in  debt and that has  to be made up  somewhere and that                                                               
is going to be through making some hard decisions.                                                                              
                                                                                                                                
CHAIR PEGGY  WILSON said the  FMATS and  AMATS is not  a separate                                                               
pot of money that comes from  the feds; the FMATS and AMATS comes                                                               
off the  top and what  is left over is  what gets divvied  out to                                                               
the rest of the communities.                                                                                                    
                                                                                                                                
MR. OTTESEN said that was correct.                                                                                              
                                                                                                                                
2:06:44 PM                                                                                                                    
MR. VIGUE said the $20  million sub-allocation is for AMATS, that                                                               
is a federal calculation, not something that DOT did.                                                                           
                                                                                                                                
CHAIR  PEGGY  WILSON  asked  how   much  goes  to  Anchorage  and                                                               
Fairbanks.                                                                                                                      
                                                                                                                                
MR. VIGUE  replied that  the $20  million sub-allocation  goes to                                                               
Anchorage because it is the  only community that qualifies with a                                                               
population over 200,000. The only  place that part of the federal                                                               
highways money can be spent in Alaska is in the Anchorage area.                                                                 
                                                                                                                                
CHAIR PEGGY WILSON asked how much AMATS would normally get.                                                                     
                                                                                                                                
MR.  OTTESEN replied  that they  were getting  a little  over $30                                                               
million prior to  this bill; now it's just over  $20 million. The                                                               
emphasis changed from local needs to the NHS and to safety.                                                                     
                                                                                                                                
2:08:48 PM                                                                                                                    
CHAIR PEGGY  WILSON asked if  there is any possibility  to exempt                                                               
Hawaii and  Alaska because  they are such  new states  and hadn't                                                               
gotten the help the older states got in their younger years.                                                                    
                                                                                                                                
MR.  OTTESEN answered  that people  spending time  in Washington,                                                               
D.C., have  said exemptions were  being struck rather  than being                                                               
created and anything with Alaska in it was getting taken out.                                                                   
                                                                                                                                
REPRESENTATIVE ISAACSON asked him to  discuss the $47 million for                                                               
any area of the state.                                                                                                          
                                                                                                                                
MR. OTTESEN answered  that money right now is  dedicated to three                                                               
big needs:                                                                                                                      
                                                                                                                                
1.  The many  required programs  under the  legislation like  the                                                               
nearly 1,000  bridges inspections that  have to take  place every                                                               
other year.  This STP funding  is one of  the big sources  of how                                                               
that work gets  done. They also have to pay  off GARVI bonds from                                                               
2002, and rather than taking it  out of the smaller slices at the                                                               
expense  of the  smaller communities  it  gets taken  out of  the                                                               
statewide pot, which is for  the common good. The data collection                                                               
requirement under MAP-21 has gone  up intensively, because it's a                                                               
performance  program.   They  have  to  collect   data  and  have                                                               
management  systems. There  really is  no other  place for  those                                                               
costs  to be  coming  out of.  Right now  those  funds are  over-                                                               
subscribed.                                                                                                                     
                                                                                                                                
2. Bridges  is a second thing  and over 500 bridges  in the state                                                               
are unfunded except  for the blue portion. They  have been really                                                               
putting an emphasis on bridges  for almost a decade; we're making                                                               
progress, and the  NHS is in pretty good shape,  but you can work                                                               
really  hard and  still go  backwards. Last  year 9  bridges were                                                               
taken off the deficient list but 14 were added.                                                                                 
                                                                                                                                
3. Finally, there  are 1,600 miles of state highway  that are not                                                               
NHS, but  they are still important  and serve all corners  of the                                                               
state.                                                                                                                          
                                                                                                                                
2:15:11 PM                                                                                                                    
MR. VIGUE said another new program  in MAP-21 that evolved out of                                                               
the  ashes  of  some  previous  programs  is  the  Transportation                                                               
Alternatives  Program.  It  basically  takes  the  Transportation                                                               
Enhancements  Program,  which  has been  in  federal  legislation                                                               
since  the early  1990s -  the  Scenic Byways  Program, the  Safe                                                               
Routes   to  School   Program  (new   with  SAFETY-LU)   and  the                                                               
Recreational Trails Program  - and merged them  all together into                                                               
this Transportation  Alternatives Program. The one  thing that is                                                               
different  about this  is that  the  Recreational Trails  Program                                                               
gets an automatic  allocation at the '09 level;  and that program                                                               
is  managed  by the  Department  of  Natural Resources  (DNR)  in                                                               
Alaska.                                                                                                                         
                                                                                                                                
He explained  that the Transportation Alternatives  funding comes                                                               
to the  state in  a very similar  way the  Surface Transportation                                                               
Program (STP)  funds come and  that is through  sub-allocation by                                                               
population.                                                                                                                     
                                                                                                                                
2:16:41 PM                                                                                                                    
REPRESENTATIVE  ISAACSON  said he  sat  on  the North  Richardson                                                               
Scenic  Byways Advisory  Board and  asked if  there is  dedicated                                                               
money for scenic  byways that could make  improvements for things                                                               
such as restrooms and pullouts.                                                                                                 
                                                                                                                                
MR. VIGUE  answered in the past  there was a small  dedicated pot                                                               
of  money  that  was  competed for  nationally.  So,  every  year                                                               
someone on their staff would  solicit nominations from the Scenic                                                               
Byways Committees, score  them and send them  to FHW Headquarters                                                               
in  D.C. that  would  determine which  projects  had the  highest                                                               
rating and  would get  funded. Alaska has  had success  with that                                                               
program seeing anywhere from 2  to 6 discretionary grants. MAP-21                                                               
eliminated that program as well  as the federally funded clearing                                                               
house  that was  based in  Duluth, Minnesota,  that had  resource                                                               
people on hand to help  byway committees develop their vision for                                                               
the corridor.  Certain aspects  of the  Scenic Byway  Program are                                                               
eligible under  the Transportation  Alternatives Program,  but it                                                               
has such  a small amount  of money and  some odd rules.  First is                                                               
the sub-allocation  by population,  and they also  have something                                                               
called a  definition of "eligible  entities," and the  states and                                                               
MPOs are not eligible, meaning that  the state and the MPO cannot                                                               
sponsor  a project  for  any  of these  programs  whether it's  a                                                               
bike/ped facility  or a safe  routes to school-type project.   He                                                               
said  they are  still trying  to understand  how this  program is                                                               
going  to be  managed. AMATS  is going  to get  $775,000 and  you                                                               
can't build a lot of  sidewalk with that. Places with populations                                                               
of less  than 5,000, a huge  portion of the state,  get $814,000.                                                               
The previous programs provided more  flexibility to use the funds                                                               
and get projects built.                                                                                                         
                                                                                                                                
REPRESENTATIVE ISAACSON asked if  any specific projects are being                                                               
threatened.                                                                                                                     
                                                                                                                                
MR.  VIGUE answered  that they  are still  trying to  figure that                                                               
out. Some of  the projects are still moving  forward because they                                                               
have some old Transportation Enhancement (TE) funds.                                                                            
                                                                                                                                
REPRESENTATIVE ISAACSON  asked if projects in  the pipeline could                                                               
be completed.                                                                                                                   
                                                                                                                                
MR. VIGUE answered yes.                                                                                                         
                                                                                                                                
CHAIR PEGGY WILSON  asked him to share that  information with the                                                               
chairs as he finds it out.                                                                                                      
                                                                                                                                
2:17:11 PM                                                                                                                    
SENATOR DYSON said it would be  valuable for him to know how much                                                               
is spent  on transportation in  each area juxtaposed  against the                                                               
population.  Some areas  spend more  on ferries,  breakwaters and                                                               
docks and  he wasn't  sure how  much GF money  is spent  in those                                                               
districts  or  how they  could  be  distinguished. However,  they                                                               
should  be operating  from  criteria based  on  need with  safety                                                               
coming first.                                                                                                                   
                                                                                                                                
MR. OTTESEN said they have three  or four excellent data bases on                                                               
the condition  and the  use of  our system.  They know  where the                                                               
crashes occur,  their severity  and causes. The  same is  true of                                                               
traffic  volumes,  average  speeds  and   a  count  and  type  of                                                               
vehicles. They know the conditions  of the bridges and pavements.                                                               
They use  that type of  data to  identify projects, and  it's not                                                               
always mindful of  which district gets the most  money that year,                                                               
but it is  the rational approach for something as  important as a                                                               
highway system, which is where the economy happens.                                                                             
                                                                                                                                
He said  the department  keeps track  of election  districts, but                                                               
unfortunately those  are transitory and change  shape and number.                                                               
Right now  they are starting  to geocode projects and  the beauty                                                               
of a GIS location is that  you can change districts all you want,                                                               
but the work  will still be revealed going  forward. However that                                                               
would be hard to do in retrospect.                                                                                              
                                                                                                                                
MR. VIGUE  said they could  look at some  of the websites  in Ms.                                                               
Rice's presentation, because a lot  of project information is out                                                               
there.                                                                                                                          
                                                                                                                                
SENATOR DYSON  said it would be  useful to know how  much capital                                                               
money had  been spent in  each area and  what is being  spent per                                                               
capita in each area for routine maintenance.                                                                                    
                                                                                                                                
CHAIR PEGGY WILSON  said it's obvious that the state  is going to                                                               
get less and less  money from the feds and asked  if there is any                                                               
way to  connect with another  department, like DNR, or  when they                                                               
talk about roads to resources, because  if we don't have roads to                                                               
resources we  won't be  able to  develop some  areas to  get more                                                               
money coming in.                                                                                                                
                                                                                                                                
2:30:22 PM                                                                                                                    
MR.  OTTESEN said  the  short answer  is they  are  looking at  a                                                               
private partnership tool in concert  with AIDEA known as 3P, that                                                               
essentially lets the resource owners  help to pay for these roads                                                               
and  other access  facilities, whether  it  be a  harbor or  some                                                               
other feature. They don't have to  put the money up front, but it                                                               
is an operating expense at a  time of revenue, which is what they                                                               
prefer, rather  than a  capital expense  years prior  to revenue.                                                               
It's a  good partnership,  and the money  is essentially  off the                                                               
state books; it doesn't have to  come at the expense of education                                                               
and roads and  all the other things the  legislature struggles to                                                               
find funding for.                                                                                                               
                                                                                                                                
MR. VIGUE said slide 15  showed the previous funding for ferries;                                                               
it  received  the  $10  million set-aside  plus  the  ability  to                                                               
compete in  the discretionary  program, both  of which  have gone                                                               
away and been  replaced under MAP-21 with $67 million  to be used                                                               
nationally for ferry  service that has a  formula for preference;                                                               
45  percent of  the funds  are based  on the  number of  vehicles                                                               
carried, 35 percent  of the allocation is based on  the number of                                                               
route miles and 20 percent is  based on the number of passengers.                                                               
They  haven't heard  from federal  highways how  that calculation                                                               
would work  for Alaska, but  35 percent allocated by  route miles                                                               
should serve us well.                                                                                                           
                                                                                                                                
He said  that MAP-21  eliminated the  Forest Highway  Program and                                                               
Shakwak   funding   (the   money   that   the   Federal   Highway                                                               
Administration  provided  directly  to the  Yukon  government  to                                                               
maintain the Haines  and Alaska Highways). He  explained that the                                                               
Forest  Highway  Program that  was  previously  dedicated to  the                                                               
Tongass and  Chugach National Forests  was replaced by  a smaller                                                               
program that is open to all federal land management agencies.                                                                   
                                                                                                                                
2:33:55 PM                                                                                                                    
Alaska  used  to  get  $9 million  administered  by  the  Western                                                               
Federal Lands  Office in Vancouver,  Washington, with  input from                                                               
Alaska and  the Forest  Service. That program  has changed  to be                                                               
something called the  Federal Land Access Program  and instead of                                                               
$9 million it's $7 million; and  instead of just being the Forest                                                               
Service it's  all federal  land management  agencies -  BLM, Fish                                                               
and Wildlife  Service, National Park Service,  and Forest Service                                                               
- all have the ability to compete for that $7 million.                                                                          
                                                                                                                                
CHAIR PEGGY  WILSON asked if those  are the funds that  put paved                                                               
roads on Prince of Wales (POW).                                                                                                 
                                                                                                                                
MR.  OTTESEN replied  yes,  as well  as on  many  other areas  of                                                               
Southeast and  the Chugach. But  the Prince of Wales  road system                                                               
owes  its   existence  to   the  program,   and  its   demise  is                                                               
unfortunate.                                                                                                                    
                                                                                                                                
CHAIR  EGAN asked  if places  like  Gustavus and  Denali will  be                                                               
competing for this money.                                                                                                       
                                                                                                                                
MR. OTTESEN  answered yes  and they  have already  seen a  lot of                                                               
interest.  He explained  that his  first call  for projects  will                                                               
occur  in  a  month  or  two.  A  three-member  board  makes  the                                                               
decisions;  one  member  is  from the  Forest  Highway  group  in                                                               
Vancouver, Washington, himself  and Cathy Wasserman, representing                                                               
local  governments  for  Alaska.  So, two  Alaskans  are  on  the                                                               
committee.  Communities can  nominate projects,  too; he  already                                                               
feels a tension between the federal agencies and local needs.                                                                   
                                                                                                                                
2:36:29 PM                                                                                                                    
MR. VIGUE  said they see a  similar trend developing in  terms of                                                               
providing more information to Federal  Highways under MAP-21. The                                                               
state will  have to collect  more data and provide  a significant                                                               
number  of NHS  performance measures.  It should  begin soon  and                                                               
will include  pavement, bridge condition, safety  (fatalities and                                                               
serious injury crashes), freight  mobility and congestion. By the                                                               
time MAP-21 expires  they will know what all of  them are. So one                                                               
way to look at  MAP-21 is that it is the  blueprint for what they                                                               
think they  are going to do  next time - and  hopefully next time                                                               
the the funding  scenario will be figured out and  the states get                                                               
a five or six year bill instead of the two-year bill.                                                                           
                                                                                                                                
2:37:56 PM                                                                                                                    
SENATOR BISHOP asked  if more federal reporting will  "get us any                                                               
more lane miles"  and commented that "at the end  of the day they                                                               
will  dream up  another new  mix  design so  every heavy  highway                                                               
contractor in Alaska has to buy a whole crushing spread."                                                                       
                                                                                                                                
MR. VIGUE explained  that the feds will  set national performance                                                               
measures and then the state will  have the flexibility to set the                                                               
target that they are going to try  to reach. But if we don't meet                                                               
those  targets  there  are  penalties.   For  instance,  the  one                                                               
performance measure  they know of  has to do with  the percentage                                                               
of bridge deck  that is on structurally  deficient bridges. Right                                                               
now that  is set at  10 percent. If more  than 10 percent  of the                                                               
total  bridge  deck  on  the NHS  is  on  structurally  deficient                                                               
bridges, then they  force you to take some of  your NHS money and                                                               
put it on NHS bridges. And if  you still don't meet it, there's a                                                               
further  penalty   which  could  raise  the   match  requirements                                                               
(currently at 90/10) by as much as 40 percent.                                                                                  
                                                                                                                                
MR.  VIGUE said  MAP-21 also  included some  streamlining efforts                                                               
that  will hopefully  enable the  department to  deliver projects                                                               
faster.   The  most   intriguing  ones   are  the   environmental                                                               
streamlining provisions, one  of which is that we  should be able                                                               
to   use   categorical   exclusions   more   often   than   doing                                                               
environmental impact  statements, because  they are  the simplest                                                               
fastest processes available.                                                                                                    
                                                                                                                                
He said another  goal of MAP-21 was to streamline  the process of                                                               
managing the program.  There used to be over 80  funding pots and                                                               
now they are down to the  30s. Other funding categories in MAP-21                                                               
are CMAQ  (congestion, mitigation, air quality),  which increased                                                               
slightly overall; Fairbanks  gets a fair amount of  this money to                                                               
try to  address its air  quality issues. Highway  safety projects                                                               
are being  well-funded and  the state gets  about $26  million in                                                               
Highway Safety  Improvement Program  and another $1.1  million to                                                               
take care  of rail highway  crossings, put up signals  and lights                                                               
and fix the surface so it's not  so rough to cross, and the $21.1                                                               
million of  hazard elimination (the  sanction money that  goes to                                                               
the  safety  program,  because   Alaska  doesn't  have  a  repeat                                                               
offender  and an  open container  law).  So, Alaska  will have  a                                                               
substantial  safety  program  over  the  next  few  years.  Urban                                                               
planning  funds are  provided  to the  two MPOs  and  they had  a                                                               
slight increase.                                                                                                                
                                                                                                                                
2:44:15 PM                                                                                                                    
MR.  VIGUE  said  overall  they  think  federal  funding  remains                                                               
consistent  with the  SAFETY-LU  average. It's  not  in the  same                                                               
spendable categories, but it has  been shifted around and focused                                                               
on  NHS and  safety. It's  about the  same amount  of money,  but                                                               
fewer funding categories that are  more restrictive. They reduced                                                               
Surface  Transportation Program  (STP) funding  and sub-allocated                                                               
it by population.  It will be necessary  to use a lot  of the STP                                                               
funding on  bridges where there  is no longer a  dedicated bridge                                                               
program. With the NHS focus,  there is less funding available for                                                               
lower  class roads,  which includes  the  Alaska Highway  System.                                                               
Safety    funding   is    significantly   increased,    and   the                                                               
Transportation Alternatives  Program has  significant challenges;                                                               
they  are still  waiting to  hear what  the performance  measures                                                               
are.  The   feds  have  also  required   a  transportation  asset                                                               
management  system,   which  will   feed  into   the  performance                                                               
measures,  and the  department is  actively working  to put  that                                                               
together.                                                                                                                       
                                                                                                                                
2:45:37 PM                                                                                                                    
REPRESENTATIVE ISAACSON said  he was concerned about  the loss of                                                               
Alaska  Highway  money  and  asked   if  he  had  talked  to  his                                                               
counterparts  in  Canada   to  see  what  their   plans  are  for                                                               
maintaining those Shakwak roads.                                                                                                
                                                                                                                                
MR. VIGUE  answered that  he had met  with counterparts  at Yukon                                                               
DOT  and they  were  very  disappointed that  the  funding is  no                                                               
longer available,  but he  wasn't sure what  their plans  were. A                                                               
meeting was set  up with them next week. They  were very involved                                                               
in the  debate on MAP-21  in Washington,  D.C. to try  to protect                                                               
that funding.                                                                                                                   
                                                                                                                                
CHAIR  EGAN asked  him to  keep  the committee  informed on  that                                                               
status.                                                                                                                         
                                                                                                                                
SENATOR  DYSON added  that some  Canadian  members of  Parliament                                                               
were  here  today and  that  the  Yukon Territory  was  concerned                                                               
because it  has less than  30,000 people. That highway  was built                                                               
during the  war to have a  land-based route; it is  a huge safety                                                               
issue  "like suspenders"  for Alaska.  But for  the Yukon  it's a                                                               
huge asset, and they don't have  the kind of resources that other                                                               
places  have  to do  it.  That  highway  runs through  some  very                                                               
mineralized  areas, and  without  the  transportation links  they                                                               
don't work.                                                                                                                     
                                                                                                                                
CHAIR EGAN said  it's shameful that so much money  had been spent                                                               
improving the Alaska Highway over  the last decades and now we're                                                               
going  to let  it deteriorate  again. It  doesn't make  sense. He                                                               
thanked  them for  their presentation  and invited  Mr. Walsh  to                                                               
present Roads to Resources.                                                                                                     
                                                                                                                                
2:48:47 PM                                                                                                                    
MURRAY WALSH, Special Assistant  to the Commissioner and Manager,                                                               
Road  to  Resources,  Department  of  Transportation  and  Public                                                               
Facilities (DOTPF), said the roads  to resources initiative began                                                               
during the Murkowski  administration as a way  to focus attention                                                               
on  resource  development and  one  of  its most  crucial  needs,                                                               
surface access.                                                                                                                 
                                                                                                                                
He said these funds had  previously been used on smaller projects                                                               
that  were  affordable  by  the  state, but  now  that  is  being                                                               
expanded  to  larger projects  that  would  help fill  the  TAPS,                                                               
create jobs, and increase commerce.                                                                                             
                                                                                                                                
Their  guideline  is  if  DOT does  the  initial  permitting  and                                                               
environmental work,  an inexpensive road  could be built  to some                                                               
remote  location to  make a  mining project  possible. Then  they                                                               
would develop  a long-range public  private partnership  with the                                                               
developer, miner  or petroleum developer,  who would pay  for the                                                               
road  in the  long term,  the final  road being  paid for  by the                                                               
beneficiary.                                                                                                                    
                                                                                                                                
MR.  WALSH said  once the  road is  there it  can be  improved as                                                               
other  beneficiaries come  along and  as traffic  and development                                                               
make it possible. If there are  lots of beneficiaries like on the                                                               
Klondike  Highway,  tolls can  be  charged  to industrial  users,                                                               
particularly  those who  drive overweight  rigs.  Last year  four                                                               
projects were authorized in the 2013 budget:                                                                                    
1.  A  100-mile  road  connecting  the Dalton  Hwy  to  Umiat,  a                                                               
petroleum play that Link is looking to explore this winter.                                                                     
2.  A 200-mile  road to  the Ambler  mining district  also to  be                                                               
paved by their  end user beneficiaries using the  concept of: "We                                                               
light the  fuse, they make it  go." He explained that  the Alaska                                                               
Industrial  Development and  Export Authority  (AIDEA) who  would                                                               
raise the money to build the  road so that the payoff could occur                                                               
when the mines or the petroleum are in a revenue status.                                                                        
3. A shorter  Tanana road that would bring surface  access to the                                                               
river's width;  the Tanana residents are  already benefiting from                                                               
the clearing of the road that was done last summer.                                                                             
4. Replacing a bridge on the  Klondike to make it serviceable for                                                               
the large overweight rigs.                                                                                                      
                                                                                                                                
2:53:38 PM                                                                                                                    
MR. WALSH  said the legislature added  a lot to the  2013 capital                                                               
budget,  but  the  2014  capital budget  request  was  much  more                                                               
modest. It was  just more money to get the  Ambler access project                                                               
into  the  full-on  environmental  review  process  and  to  help                                                               
upgrade the Dalton Highway for the  rigors it will be enduring in                                                               
the next few  years, specifically using a  Dalton Highway traffic                                                               
forecast  that added  up the  projected  traffic for  all of  the                                                               
different companies  who are planning  to do things on  the North                                                               
Slope.                                                                                                                          
                                                                                                                                
He said the  Umiat area is petroleum rich and  is thought to have                                                               
millions of  barrels of oil and  trillions of cubic feet  of gas.                                                               
The road  they would  build there  would be a  basic 18  ft. wide                                                               
gravel road that  would cost $200 to $300 million.  That is money                                                               
that the state  cannot get from the federal  government and would                                                               
have a hard time putting up  itself. But that money can be raised                                                               
by selling  bonds through  AIDEA and having  those bonds  be paid                                                               
off by the  benefiting companies. The Corps of  Engineers will be                                                               
leading the  way; they control  the schedule for how  fast things                                                               
happen under  the National Environmental Policy  Act Program. You                                                               
have to have  a Record of Decision (ROD) in  hand before actually                                                               
starting to  build a project and  they hope to start  that one in                                                               
2015.                                                                                                                           
                                                                                                                                
2:55:35 PM                                                                                                                    
He said the Ambler mining  district is mineral rich, copper being                                                               
one of  the most important finds  up there. There are  300 direct                                                               
jobs  for just  one  of  the mines  that  could  be developed  at                                                               
Novacopper, a spinoff of NovaGold.   He said this is an important                                                               
partnership  in  Alaska's  development,   because  if  the  state                                                               
doesn't  build the  road the  mine won't  happen. While  they are                                                               
looking at alternative routes, the  one they use will probably be                                                               
the shortest one from the Dalton  through the Gates of the Arctic                                                               
National Park.                                                                                                                  
                                                                                                                                
2:56:57 PM                                                                                                                    
MR. WALSH said the road to  Tanana is much shorter, 26 miles, and                                                               
serious construction will be started  in 2013. It is another very                                                               
basic road  that will enable  passage by most vehicles.  There is                                                               
lots of  mining potential in  the area  plus lots of  benefits to                                                               
the people of Tanana, and they are quite enthusiastic about it.                                                                 
                                                                                                                                
The  Yukon Territory  has a  lot of  mining activity  brewing, he                                                               
reported, and  if those  are going  to be  developed they  need a                                                               
road to get  the product out. And barring some  kind of change in                                                               
railroad  policy expanding  into the  Yukon,  it will  be on  our                                                               
roads.  The Klondike  and probably  the Haines  Highway would  be                                                               
called  in to  serve in  this way.  This could  mean some  policy                                                               
development as far  as special revenues and how to  come to grips                                                               
with these  giant 12-axle, 200,000-pound  road trains.  There are                                                               
about 60  mines brewing in the  Yukon; 3 are in  production right                                                               
now  delivering overweight  rigs  to  ship-loading facilities  in                                                               
Skagway; dozens more  are in the development stage  and every one                                                               
of  them  represents  significant   amounts  of  exploration  and                                                               
development money.  The mining business  is big in the  Yukon and                                                               
it is getting  big in British Columbia and in  Alaska. So we have                                                               
a lot of interaction.                                                                                                           
                                                                                                                                
Other projects are:                                                                                                             
-West  Susitna Access  Reconnaissance Report  that documents  the                                                               
various mining, timber and resource  opportunities there. He said                                                               
if there is a reason to  build a bridge across the Susitna River,                                                               
they would look for a place to do that.                                                                                         
-Niblack Mine Access-Prince of Wales  could benefit from improved                                                               
marine access                                                                                                                   
-Bokan Mountain  Mine Access-Prince  of Wales could  also benefit                                                               
from improved marine access                                                                                                     
-Totchaket Road-Nenana-a 400 ft. bridge                                                                                         
-Granduc Mine-Hyder Salmon Rd. (Cu) road upgrade, possible IUH                                                                  
-Petersburg-Kake   road-$40,000,000   in  FY2013   budget,   NEPA                                                               
underway                                                                                                                        
-LiDAR mapping project-$5 million in FY2013                                                                                     
-Katlian Valley Access (quarry)- Sitka $14 million 2012 bond                                                                    
                                                                                                                                
3:01:35 PM                                                                                                                    
REPRESENTATIVE FIEGE  asked if the  Umiat road  is going to  be a                                                               
public private partnership, wouldn't cost be a factor.                                                                          
                                                                                                                                
MR. WALSH  answered yes; certainly  the beneficiary has  to agree                                                               
with the final selection.                                                                                                       
                                                                                                                                
CHAIR EGAN  thanked Mr.  Walsh for his  presentation and  said he                                                               
would be invited back again.                                                                                                    
                                                                                                                                
3:03:41 PM                                                                                                                    
Finding no further business to come before the committee Chair                                                                  
Egan adjourned the Joint Senate and House Transportation                                                                        
Committee meeting at 3:03 p.m.                                                                                                  

Document Name Date/Time Subjects
MAP-21 for Joint Transportation.pdf HTRA 1/22/2013 1:00:00 PM
DOT Hiway Present Jan 22 2013.pdf HTRA 1/22/2013 1:00:00 PM
Roads to Resources 1-22-2013 Joint Trans Committee.pdf HTRA 1/22/2013 1:00:00 PM
FEDERAL-AID GLOSSARY 1-22-13.pdf HTRA 1/22/2013 1:00:00 PM