Legislature(2005 - 2006)CAPITOL 17

05/05/2005 07:30 AM TRANSPORTATION


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07:32:13 AM Start
07:34:59 AM HB237
07:47:56 AM Adjourn
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
-- Please Note Time Change --
+= HB 237 INTERNATIONAL AIRPORTS REVENUE BONDS TELECONFERENCED
Moved Out of Committee
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE TRANSPORTATION STANDING COMMITTEE                                                                           
                          May 5, 2005                                                                                           
                           7:32 a.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Jim Elkins, Co-Chair                                                                                             
Representative Carl Gatto, Co-Chair                                                                                             
Representative Vic Kohring                                                                                                      
Representative Mark Neuman                                                                                                      
Representative Bill Thomas                                                                                                      
Representative Woodie Salmon                                                                                                    
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Mary Kapsner                                                                                                     
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 237                                                                                                              
"An Act relating to international airports revenue bonds; and                                                                   
providing for an effective date."                                                                                               
                                                                                                                                
     - MOVED HB 237 OUT OF COMMITTEE                                                                                            
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 237                                                                                                                  
SHORT TITLE: INTERNATIONAL AIRPORTS REVENUE BONDS                                                                               
SPONSOR(S): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
03/29/05       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/29/05       (H)       TRA, FIN                                                                                               
04/30/05       (H)       TRA AT 1:30 PM CAPITOL 17                                                                              
04/30/05       (H)       Heard & Held                                                                                           
04/30/05       (H)       MINUTE(TRA)                                                                                            
05/03/05       (H)       TRA AT 1:30 PM CAPITOL 17                                                                              
05/03/05       (S)       OVERTAKING/PASSING STATIONARY VEHICLES                                                                 
05/05/05       (H)       TRA AT 7:30 AM CAPITOL 17                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
MIKE BARTON, Commissioner                                                                                                       
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Juneau, Alaska                                                                                                                  
POSITION STATEMENT:  Responded to  questions during discussion of                                                               
HB 237.                                                                                                                         
                                                                                                                                
MICHAEL MARTING, Controller                                                                                                     
Alaska International Airport System                                                                                             
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Anchorage, Alaska                                                                                                               
POSITION STATEMENT:  Responded to  questions during discussion of                                                               
HB 237.                                                                                                                         
                                                                                                                                
ACTION NARRATIVE                                                                                                              
                                                                                                                                
CO-CHAIR  JIM ELKINS  called  the  House Transportation  Standing                                                             
Committee  meeting  to  order at  7:32:13  AM.    Representatives                                                             
Elkins, Gatto,  Thomas, Kohring, and  Salmon were present  at the                                                               
call to order.  Representative  Neuman arrived as the meeting was                                                               
in progress.                                                                                                                    
                                                                                                                                
HB 237-INTERNATIONAL AIRPORTS REVENUE BONDS                                                                                   
                                                                                                                                
CO-CHAIR ELKINS announced  that the only order  of business would                                                               
be HOUSE BILL NO. 237  "An Act relating to international airports                                                               
revenue bonds; and providing for an effective date."                                                                            
                                                                                                                                
REPRESENTATIVE KOHRING  moved to report  HB 237 out  of committee                                                               
with individual recommendations and accompanying fiscal notes.                                                                  
                                                                                                                                
CO-CHAIR  GATTO objected.   He  asked if  any of  the funds  were                                                               
federal monies.                                                                                                                 
                                                                                                                                
MIKE BARTON, Commissioner, Department  of Transportation & Public                                                               
Facilities (DOT&PF), said  it would all be paid by  the rates and                                                               
fees charged at the two airports.                                                                                               
                                                                                                                                
CO-CHAIR  GATTO  noted  that  the  fees  are  passed  on  to  the                                                               
consumer, and asked how much it will raise ticket prices.                                                                       
                                                                                                                                
7:34:59 AM                                                                                                                    
                                                                                                                                
COMMISSIONER  BARTON said  he doesn't  know the  formula that  an                                                               
airline  might use,  but  he  said he  can  approximate  it.   By                                                               
looking at the landing fees,  a 737-400 landing in Anchorage will                                                               
pay a total of $235, which  is an increase of $.72 per passenger.                                                               
He said  the airlines  approved the  projects, and  obviously ran                                                               
the necessary calculations.                                                                                                     
                                                                                                                                
CO-CHAIR GATTO said the original "C" terminal was over budget.                                                                  
                                                                                                                                
COMMISSIONER  BARTON agreed  that it  was very  much over  budget                                                               
because   of  additional   security  requirements,   added  space                                                               
requested  by  the  airlines,  and  permitting  issues  with  the                                                               
municipality of  Anchorage.   He said DOT&PF  has a  new contract                                                               
structure to avoid a cost overrun.                                                                                              
                                                                                                                                
CO-CHAIR  GATTO said  there is  already a  ticket price  increase                                                               
because of  the cost  of the  "C" terminal and  there will  be an                                                               
additional increase to renovate the "A" and "B" terminals.                                                                      
                                                                                                                                
COMMISSIONER  BARTON said  80  percent of  the  landing fees  are                                                               
picked up by  cargo carriers, and that sthe  shippers support the                                                               
plan.                                                                                                                           
                                                                                                                                
CO-CHAIR GATTO noted that rent space tripled recently.                                                                          
                                                                                                                                
COMMISSIONER BARTON  said "they" knew  that when "they"  voted on                                                               
the project.   He  said the  landing fees are  the lowest  of the                                                               
major airports.                                                                                                                 
                                                                                                                                
7:40:14 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN asked  what  DOT&PF will  do  if the  bill                                                               
fails.                                                                                                                          
                                                                                                                                
COMMISSIONER BARTON  said the project  would not  proceed, adding                                                               
that  there   would  be  liability   to  the  state   because  of                                                               
deficiencies in the seismic code.                                                                                               
                                                                                                                                
REPRESENTATIVE NEUMAN asked what amount  of the money would go to                                                               
Fairbanks.                                                                                                                      
                                                                                                                                
MICHAEL   MARTING,  Controller,   Alaska  International   Airport                                                               
System,   Department  of   Transportation  &   Public  Facilities                                                               
(DOT&PF), said  there is $105  million for the  Fairbanks airport                                                               
and the balance would go to Anchorage.                                                                                          
                                                                                                                                
COMMISSIONER BARTON said,  "What we're doing is  raising the bond                                                               
cap so that we can accommodate this $288 million sale."                                                                         
                                                                                                                                
REPRESENTATIVE NEUMAN asked if the money has been spent.                                                                        
                                                                                                                                
COMMISSIONER BARTON  said it is  used and  some are paid  off and                                                               
some are being paid, but it is all invested in capital projects.                                                                
                                                                                                                                
7:43:05 AM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN asked  if any of this work  was included in                                                               
prior plans so that the bill covers previous cost overruns.                                                                     
                                                                                                                                
MR.  MARTING said  there  is  $17 million  for  the A/B  retrofit                                                               
already in the  budget, and the balance is all  new money and new                                                               
projects.                                                                                                                       
                                                                                                                                
CO-CHAIR GATTO asked what the "C" terminal cost overrun was.                                                                    
                                                                                                                                
MR. MARTING said he thought it was $100 million.                                                                                
                                                                                                                                
CO-CHAIR GATTO said  every major project has a cost  overrun.  He                                                               
asked if a 30 percent cost overrun is typical.                                                                                  
                                                                                                                                
COMMISSIONER BARTON said  he can't say it is typical,  but in the                                                               
course of developing projects, unknowns  are encountered, such as                                                               
terrorist attacks or environmental hazards.                                                                                     
                                                                                                                                
7:45:39 AM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO said there is never an under-run.                                                                                
                                                                                                                                
COMMISSIONER  BARTON said  it is  rare but  there have  been some                                                               
cases, like the Bradley Lake project.                                                                                           
                                                                                                                                
CO-CHAIR GATTO maintained his objection.                                                                                        
                                                                                                                                
A  roll call  vote was  taken.   Representatives Salmon,  Elkins,                                                               
Neuman, Thomas,  and Kohring voted  in favor of reporting  HB 237                                                               
from  committee.     Representative   Gatto  voted   against  it.                                                               
Therefore,  HB 237  was reported  from  the House  Transportation                                                               
Standing Committee by a vote of 5-1.                                                                                            
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Transportation  Standing Committee  meeting adjourned  at 7:47:56                                                             
AM.                                                                                                                           

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