Legislature(2005 - 2006)CAPITOL 17

03/14/2006 01:30 PM TRANSPORTATION


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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
* HB 491 ALASKA RAILROAD REVENUE BONDS
Moved Out of Committee
* HB 434 AUTHORIZE HWY PROGRAM PARTICIPATION
Moved Out of Committee
* HJR 26 PREVENTION OF POLLUTION FROM SHIPS
<Bill Hearing Canceled>
                    ALASKA STATE LEGISLATURE                                                                                  
            HOUSE TRANSPORTATION STANDING COMMITTEE                                                                           
                         March 14, 2006                                                                                         
                           1:30 p.m.                                                                                            
                                                                                                                                
MEMBERS PRESENT                                                                                                               
                                                                                                                                
Representative Jim Elkins, Co-Chair                                                                                             
Representative Carl Gatto, Co-Chair                                                                                             
Representative Vic Kohring                                                                                                      
Representative Mark Neuman                                                                                                      
Representative Bill Thomas                                                                                                      
Representative Mary Kapsner                                                                                                     
                                                                                                                                
MEMBERS ABSENT                                                                                                                
                                                                                                                                
Representative Woodie Salmon                                                                                                    
                                                                                                                                
COMMITTEE CALENDAR                                                                                                            
                                                                                                                                
HOUSE BILL NO. 434                                                                                                              
"An  Act  authorizing  the  commissioner  of  transportation  and                                                               
public  facilities  to  participate in  certain  federal  highway                                                               
programs and  relating to that authorization;  relating to powers                                                               
of the  attorney general to  waive immunity from suit  in federal                                                               
court related to  those programs; and providing  for an effective                                                               
date."                                                                                                                          
                                                                                                                                
     - MOVED HB 434 OUT OF COMMITTEE                                                                                            
                                                                                                                                
HOUSE BILL NO. 491                                                                                                              
"An  Act authorizing  the Alaska  Railroad  Corporation to  issue                                                               
revenue  bonds  to  finance  rail  transportation  projects  that                                                               
qualify for  federal financial  participation; and  providing for                                                               
an effective date."                                                                                                             
                                                                                                                                
     - MOVED HB 491 OUT OF COMMITTEE                                                                                            
                                                                                                                                
HOUSE JOINT RESOLUTION NO. 26                                                                                                   
Requesting the  United States  Senate to ratify  Annex VI  of the                                                               
International  Convention for  the Prevention  of Pollution  from                                                               
Ships, 1973, as modified by the Protocol of 1978.                                                                               
                                                                                                                                
     - BILL HEARING CANCELED                                                                                                    
                                                                                                                                
PREVIOUS COMMITTEE ACTION                                                                                                     
                                                                                                                                
BILL: HB 434                                                                                                                  
SHORT TITLE: AUTHORIZE HWY PROGRAM PARTICIPATION                                                                                
SPONSOR(s): RULES BY REQUEST OF THE GOVERNOR                                                                                    
                                                                                                                                
02/08/06       (H)       READ THE FIRST TIME - REFERRALS                                                                        
02/08/06       (H)       TRA, JUD, FIN                                                                                          
03/14/06       (H)       TRA AT 1:30 PM CAPITOL 17                                                                              
                                                                                                                                
BILL: HB 491                                                                                                                  
SHORT TITLE: ALASKA RAILROAD REVENUE BONDS                                                                                      
SPONSOR(s): TRANSPORTATION                                                                                                      
                                                                                                                                
03/08/06       (H)       READ THE FIRST TIME - REFERRALS                                                                        
03/08/06       (H)       TRA, FIN                                                                                               
03/14/06       (H)       TRA AT 1:30 PM CAPITOL 17                                                                              
                                                                                                                                
WITNESS REGISTER                                                                                                              
                                                                                                                                
JOHN MACKINNON, Deputy Commissioner                                                                                             
Department of Transportation & Public Facilities (DOT&PF)                                                                       
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Presented HB 434.                                                                                           
                                                                                                                                
PETER PUTZIER, Senior Assistant Attorney General                                                                                
Department of Law (DOL)                                                                                                         
Juneau, Alaska                                                                                                                  
POSITION STATEMENT: Answered questions regarding HB 434.                                                                        
                                                                                                                              
PAT GAMBLE, President and Chief Executive Officer                                                                               
Alaska Railroad Corporation                                                                                                     
Anchorage, Alaska                                                                                                               
POSITION STATEMENT: Testified in support of HB 491.                                                                             
                                                                                                                              
ACTION NARRATIVE                                                                                                              
                                                                                                                                
CO-CHAIR  CARL GATTO  called  the  House Transportation  Standing                                                             
Committee  meeting  to  order at  1:30:59  PM.    Representatives                                                             
Kohring, Neuman,  Elkins, and Gatto  were present at the  call to                                                               
order.    Representatives  Thomas  and  Kapsner  arrived  as  the                                                               
meeting was in progress.                                                                                                        
                                                                                                                                
HB 434-AUTHORIZE HWY PROGRAM PARTICIPATION                                                                                    
                                                                                                                                
1:36:33 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO announced  that the first order  of business would                                                               
be HOUSE  BILL NO. 434,  "An Act authorizing the  commissioner of                                                               
transportation and  public facilities  to participate  in certain                                                               
federal  highway programs  and  relating  to that  authorization;                                                               
relating  to powers  of the  attorney general  to waive  immunity                                                               
from  suit  in  federal  court related  to  those  programs;  and                                                               
providing for an effective date."                                                                                               
                                                                                                                                
1:37:19                                                                                                                         
                                                                                                                                
JOHN    MACKINNON,    Deputy    Commissioner,    Department    of                                                               
Transportation &  Public Facilities (DOT&PF), referred  to HB 434                                                               
as a National Environmental Policy  Act of 1969 (NEPA) delegation                                                               
bill.   He said  the passage of  the Safe,  Accountable, Flexible                                                               
and  Efficient  Transportation  Equity  Act-a  Legacy  for  Users                                                               
(SAFETEA-LU)  highway bill  in August  included a  six-year pilot                                                               
program  for  five   states  to  assume  NEPA   delegation.    He                                                               
paraphrased from the following [original punctuation provided]:                                                                 
                                                                                                                                
     SAFETEA-LU  includes a  NEPA  delegation pilot  program                                                                    
     for five  states - Alaska, California,  Oklahoma, Ohio,                                                                    
     and  Texas.   Under the  program, the  five states  are                                                                    
     eligible to  apply for delegation  of the  Secretary of                                                                    
     Transportation's (Secretary)  NEPA responsibilities for                                                                    
     one or  more highway  projects within  the state.   The                                                                    
     state may also  apply for delegation of some  or all of                                                                    
     the     Secretary's     review     and     consultation                                                                    
     responsibilities  under   other  Federal  environmental                                                                    
     laws.    The scope  of  delegation  will be  determined                                                                    
     through application  to the Secretary and  execution of                                                                    
     a Memorandum of Understanding (MOU).                                                                                       
                                                                                                                                
     Time Frame:                                                                                                                
                                                                                                                                
     Duration  of  the  pilot  program  is  six  years  from                                                                    
     enactment of  SAFETEA-LU.  Unless extended  by statute,                                                                    
     the pilot terminates on August 10, 2011.                                                                                   
                                                                                                                                
     The Secretary is required  to promulgate regulations to                                                                    
     establish    delegation    application    requirements.                                                                    
     Rulemaking is  required to be complete  within 270 days                                                                    
     of the Act.  Rulemaking is currently behind schedule.                                                                      
                                                                                                                                
     The State may not submit its application until:                                                                            
     Rulemaking is complete, and                                                                                                
     The State  must advertise  the application  and solicit                                                                    
     public comment.                                                                                                            
                                                                                                                                
     After application is accepted,  the State and Secretary                                                                    
     will enter into an MOU.                                                                                                    
                                                                                                                                
     Once the MOU is executed, delegation may proceed.                                                                          
                                                                                                                                
     Delegation Options:                                                                                                        
                                                                                                                                
     NEPA delegation  is limited to  highway projects.   The                                                                    
     term includes roads,  streets, and parkways, rights-of-                                                                    
     way, bridges, and protective structures.                                                                                   
                                                                                                                                
     NEPA delegation  may be programmatic, or  for specific,                                                                    
     identified projects.   The State has  broad latitude to                                                                    
     determine  the FHWA  environmental responsibilities  it                                                                    
     would  like to  assume  (i.e. Ces,  Eas, EISs,  Section                                                                    
     4(f)).                                                                                                                     
                                                                                                                                
     The State intends to request  delegation for all of the                                                                    
     Secretary's   environmental  review   and  consultation                                                                    
     responsibilities  under   other  Federal  environmental                                                                    
     laws  (examples include  Section  106  of the  National                                                                    
     Historic  Preservation  Act,  and   Section  7  of  the                                                                    
     Endangered Species Act).                                                                                                   
                                                                                                                                
     NEPA delegation  is limited to  environmental decision-                                                                    
     making.  It does not extend to engineering decisions.                                                                      
                                                                                                                                
     Requirements and Responsibilities:                                                                                         
                                                                                                                                
     Under   delegation,  the   State   would  assume   sole                                                                    
     responsibility and  liability for its NEPA  actions and                                                                    
     decisions  and  would  be   subject  to  Federal  court                                                                    
     jurisdiction.   To  receive  delegation,  the State  is                                                                    
                             th                                                                                                 
     required to waive its 11   Amendment sovereign immunity                                                                    
     from suits in Federal court for decisions under NEPA.                                                                      
                                                                                                                                
     The  State   will  be  required  to   comply  with  all                                                                    
     applicable    Federal     laws,    Executive    Orders,                                                                    
     regulations,    policies   and    guidance   for    the                                                                    
     responsibilities it assumes.                                                                                               
                                                                                                                                
     The State's delegation programs  will be audited, twice                                                                    
     annually for the first  two years, annually thereafter.                                                                    
     The audits will be available for public comment.                                                                           
                                                                                                                                
      The Secretary is required to submit an annual report                                                                      
     to Congress on the pilot program.                                                                                          
                                                                                                                                
     The Secretary may terminate any state's participation                                                                      
     in the pilot program at any time for cause.                                                                                
                                                                                                                                
1:42:45 PM                                                                                                                    
                                                                                                                                
CO-CHAIR  ELKINS asked  if it  will make  the process  faster and                                                               
cheaper because it's all contained within the state.                                                                            
                                                                                                                                
MR. MACKINNON  said it is  easier to move a  piece of paper  on a                                                               
state desk.  The state has  a great relationship with the Federal                                                               
Highway Administration, "but we can also improve the process."                                                                  
                                                                                                                                
CO-CHAIR ELKINS asked how this applies to the ferry system.                                                                     
                                                                                                                                
MR. MACKINNON said  for any federal dollar spent  on the ferries,                                                               
the state has to go  through NEPA documentation, usually a simple                                                               
one.  New  vessels require a NEPA process, as  does brush cutting                                                               
along roads when  done by the federally-funded SAGA  program.  He                                                               
said he  doesn't know  all the  rules, but  the state  is serious                                                               
about taking over the program, and this will allow it to happen.                                                                
                                                                                                                                
1:44:51 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN  asked about  the state  assuming liability                                                               
for NEPA actions.                                                                                                               
                                                                                                                                
PETER PUTZIER, Senior  Assistant Attorney General, Transportation                                                               
Section, Department of  Law, said the waiver is  required, and it                                                               
means the  state would be  subject to  suit in federal  court and                                                               
would have to defend its actions.   The waiver could be made on a                                                               
case or project basis, or it could be done more broadly.                                                                        
                                                                                                                                
1:47:22 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN asked  if the sovereign immunity  has to do                                                               
with lawsuits against the state and the implications.                                                                           
                                                                                                                                
MR.  PUTZIER said  the state  will be  standing in  the shoes  of                                                               
FHWA-taking  the  same actions  and  being  subject to  the  same                                                               
standards.  A lawsuit over a poor EIS could occur, he noted.                                                                    
                                                                                                                                
CO-CHAIR GATTO asked  how much money the  federal government will                                                               
send to the state because of the bill.                                                                                          
                                                                                                                                
MR. MACKINNON  said it  will be  paid for  out of  project funds.                                                               
The  state's environmental  staff will  be charging  out to  each                                                               
project, as is done currently.  There  is a state match as in all                                                               
federal  highway  funds,  he  stated.   "These  are  all  federal                                                               
receipts to pay for the program," he said.                                                                                      
                                                                                                                                
1:49:46 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO asked about the six-year pilot program.                                                                          
                                                                                                                                
MR. MACKINNON  said the state  averages one to  two environmental                                                               
impact  statements, ten  environmental assessments,  and about  a                                                               
hundred categorical  exclusions.  There are  a "couple" top-level                                                               
positions required in  the department, he stated.   Some would be                                                               
contracted out, "but we need to  have them on staff as a firewall                                                               
between the  department and  the department."   This will  be the                                                               
same  function "as  fed highways."   Judgments  on NEPA  lawsuits                                                               
have been  very, very small, he  said.  NEPA is  a procedural law                                                               
and  a violation  would be  for  failure to  follow a  particular                                                               
procedure, "in which  case a judge would order us  to go back and                                                               
hold a couple of meetings or conduct another study."                                                                            
                                                                                                                                
1:51:14 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN said the fiscal  note for FY07 through FY11                                                               
is  $637.4   million,  "and  it  doesn't   increase."  [He  later                                                               
corrected that figure  to $637,400.]  He noted that  the costs of                                                               
business always go up and he asked if more will be needed later.                                                                
                                                                                                                                
MR. MACKINNON  said, "This  would not be  general fund;  we would                                                               
not be coming back for more state  money on this."  He said these                                                               
are federal program receipts that  will pay for the positions and                                                               
added there probably ought to be a cost-of-living adjustment.                                                                   
                                                                                                                                
REPRESENTATIVE THOMAS asked if the money is from Shakwak funds.                                                                 
                                                                                                                                
MR. MACKINNON said it would be all federal funds.                                                                               
                                                                                                                                
REPRESENTATIVE THOMAS asked about liability immunity.                                                                           
                                                                                                                                
1:52:54 PM                                                                                                                    
                                                                                                                                
MR. MACKINNON  said it refers  to projects "where we  started and                                                               
finished the environmental documentation.   Any ongoing EIS would                                                               
continue to be in fed highway's hands."                                                                                         
                                                                                                                                
REPRESENTATIVE THOMAS said if it  includes the [Juneau to Haines]                                                               
road  project,  he   doesn't  like  the  bill,   because  "I  got                                                               
communities that are all against it  and it doesn't make sense to                                                               
me  to build  this  road, and  I  don't  want to  sit  here in  a                                                               
committee voting  for a  bill that does  exactly what  the people                                                               
don't want right now."                                                                                                          
                                                                                                                                
MR. MACKINNON said, "That particular  project, a couple of bridge                                                               
projects we know  about, I can think of dozens  of projects where                                                               
the environmental  document has  already started under  the hands                                                               
of  federal  highways  and  will continue  in  their  hands,  and                                                               
continue in their court, not in the state's."                                                                                   
                                                                                                                                
REPRESENTATIVE THOMAS  surmised that  the bill won't  keep people                                                               
from suing.  "I don't like  Shakwak money taken out of the marine                                                               
highway budget to build the road."                                                                                              
                                                                                                                                
MR. MACKINNON said that road  started under federal oversight and                                                               
will continue that way.                                                                                                         
                                                                                                                                
1:55:21 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE NEUMAN  moved to  report HB  434 out  of committee                                                               
with  individual  recommendations  and  the  accompanying  fiscal                                                               
notes.  There being no objection,  HB 434 was reported out of the                                                               
House Transportation Standing Committee.                                                                                        
                                                                                                                                
HB 491-ALASKA RAILROAD REVENUE BONDS                                                                                          
                                                                                                                                
1:56:05 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO announced  that the final order  of business would                                                               
be HB  491, "An Act  authorizing the Alaska  Railroad Corporation                                                               
to issue  revenue bonds to  finance rail  transportation projects                                                               
that qualify  for federal financial participation;  and providing                                                               
for an effective date."                                                                                                         
                                                                                                                                
PAT  GAMBLE,  President  and   Chief  Executive  Officer,  Alaska                                                               
Railroad  Corporation,  said   state  railroad  transfer  statute                                                               
requires the approval of the  legislature for selling bonds.  The                                                               
bill is a package for bond approval, he explained.                                                                              
                                                                                                                                
1:57:30 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO asked what the bonds will be used for.                                                                           
                                                                                                                                
MR. GAMBLE  said the bill is  to accelerate an effort  that began                                                               
in  1996  to  recapitalize the  Alaska  Railroad  infrastructure,                                                               
which is the main track.  Over  the last ten years there has been                                                               
a work program to incrementally improve  the main line, and now a                                                               
mechanism  through   SAFETEA-LU  [Safe,   Accountable,  Flexible,                                                               
Efficient Transportation  Equity Act: A Legacy  for Users] allows                                                               
the improvements to be accelerated with the use of bonding.                                                                     
                                                                                                                                
CO-CHAIR  GATTO asked  if  wooden ties  are  being replaced  with                                                               
concrete ties.                                                                                                                  
                                                                                                                                
MR. GAMBLE  said yes, where  needed.   He said these  are capital                                                               
grant  receipt revenue  bonds  in aggregate  not  to exceed  $165                                                               
million.     The  project  is  to   rehabilitate  substandard  or                                                               
potentially  unsafe tracks,  which  is the  railroad's core  work                                                               
effort  using federal  dollars since  1996.   He said,  "We began                                                               
receiving   federal  railroad   administration  dollars   through                                                               
appropriations  from  Senator Stevens,  and  we  went on  to  the                                                               
federal formula  fund process...because  we move passengers  on a                                                               
regularly-scheduled year-round  basis."  He said  the entitlement                                                               
has  increased  over  the  years,   and  between  those  and  net                                                               
earnings, "we  have put this money  in a very concerted  way into                                                               
that  mainline track."   He  added that  about $220  million have                                                               
been put "into that one  specific area...primarily from Anchorage                                                               
to Fairbanks, but, secondarily, from Seward to Anchorage."                                                                      
                                                                                                                                
2:00:20 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE  showed a  graph of the  derailments between  1996 and                                                               
2005, which is primarily due to  poor track condition.  There are                                                               
huge costs  associated with  derailments on  the main  track, but                                                               
the trend is going in the  right direction, he stated.  The train                                                               
accident   rate  is   [decreasing]  as   a  result   of  mainline                                                               
investments.   He said the money  will allow the welding  of rail                                                               
and "the  click clack will be  gone" as well as  the battering to                                                               
the joints, which can cause dangerous breaks and derailments.                                                                   
                                                                                                                                
2:02:34 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO asked why the rail is not welded.                                                                                
                                                                                                                                
MR. GAMBLE  said the  rails weren't welded  until four  years ago                                                               
when an expert  was hired who debunked the idea  that rails could                                                               
not be welded in cold climate conditions.                                                                                       
                                                                                                                                
REPRESENTATIVE NEUMAN asked  if the need to haul  freight for the                                                               
gas line created this priority.                                                                                                 
                                                                                                                                
PAT GAMBLE said  that has been a goal of  the Alaska railroad for                                                               
the five years that he has been there.                                                                                          
                                                                                                                                
2:04:23 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO  said he thought  wooden ties were better  but was                                                               
told concrete ties are more effective in preventing derailments.                                                                
                                                                                                                                
MR.  GAMBLE said  he is  not proposing  eliminating wooden  ties;                                                               
concrete ties are  not needed everywhere, but they  are a benefit                                                               
on the  curves where accidents  occur.  Concrete ties  and welded                                                               
rails provide  stability preventing  the flux that  causes wheels                                                               
to pop off.  Wooden ties will be replaced cyclically, he said.                                                                  
                                                                                                                                
2:07:11 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE said there are 3,200  ties per mile.  The project also                                                               
includes replacing  river rock  with granite  ballast for  a more                                                               
stable roadbed.   He said gas  pipe will be heavy-620  pounds per                                                               
foot, so  "we're moving up to  140-pound rail."  There  will also                                                               
be a collision avoidance program to reduce human error, he said.                                                                
                                                                                                                                
CO-CHAIR  GATTO said  the size  of the  pipe in  unknown, but  he                                                               
asked  if the  heaviest pipe  will be  heavier than  a load  like                                                               
rocks, for example.                                                                                                             
                                                                                                                                
MR. GAMBLE  said he is predicting  the size of the  pipe, and the                                                               
track will be capable of handling a least one piece.                                                                            
                                                                                                                                
2:10:17 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE said  bonding will allow for faster  improvements.  He                                                               
said  300,000  carloads  of  hazardous  material  traverse  "some                                                               
pretty sacred  country," so he  believes the public  would demand                                                               
this work.   This  debt "actually  creates a  financing structure                                                               
that  puts  some  real  rigor and  discipline  into  our  capital                                                               
program."  The program will not  vary each year as it has because                                                               
of the percentage of revenue going to paying the debt service.                                                                  
                                                                                                                                
2:12:34 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN said  a  Wasilla  realignment project  has                                                               
been discussed, and he asked if  any of those funds are included.                                                               
The people  in Wasilla  want the  track moved  west to  go around                                                               
town, and  he said  it is  an excellent  way to  get it  near Pt.                                                               
McKenzie for coal shipping.                                                                                                     
                                                                                                                                
MR. GAMBLE said the Knik Bridge is not part of this funding.                                                                    
                                                                                                                                
REPRESENTATIVE  NEUMAN  asked  for  clarity of  costs  for  track                                                               
upgrades and if some of that money could be used for a spur.                                                                    
                                                                                                                                
2:15:07 PM                                                                                                                    
                                                                                                                                
MR.  GAMBLE  said the  track  realignment  between Anchorage  and                                                               
Wasilla has been  done.  The Wasilla bypass will  take up to $200                                                               
million  and the  route is  still  being chosen.   A  feasibility                                                               
study is underway, and for the  last four years there has been no                                                               
consensus.   Prices of  land in  that area are  going up  and the                                                               
railroad  is  running out  of  options,  he noted.    Engineering                                                               
solutions may  need to be  employed that don't move  the railroad                                                               
outside of Wasilla but raises  it over the roads.  Representative                                                               
Don  Young told  him  he  supports putting  the  railroad on  the                                                               
[proposed Knik] bridge  even though it is  unaffordable.  Senator                                                               
Ted Stevens would  like to see the rail go  across the bridge, he                                                               
said, and the railroad is looking at that possibility.                                                                          
                                                                                                                                
2:18:41 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE THOMAS  said people create a  community around the                                                               
railroad and now they don't want the railroad nearby.                                                                           
                                                                                                                                
CO-CHAIR ELKINS asked if the  [proposed Knik] bridge has to built                                                               
to handle the railroad now.                                                                                                     
                                                                                                                                
MR. GAMBLE opined that now is the time to do the planning.                                                                      
                                                                                                                                
CO-CHAIR GATTO noted  that there is very little room  for cars at                                                               
the Wasilla  depot, and the  population is  out of control.   One                                                               
thought is  to elevate the  track, which is  right in front  of a                                                               
condominium, but he asked about tunneling instead.                                                                              
                                                                                                                                
MR. GAMBLE said it can be done, depending on the soil and water.                                                                
                                                                                                                                
2:20:50 PM                                                                                                                    
                                                                                                                                
CO-CHAIR GATTO  said it is only  one intersection that is  such a                                                               
problem in Wasilla.                                                                                                             
                                                                                                                                
MR. GAMBLE  said there are  water table  problems so it  can't go                                                               
underground.   If  all  the freight  went  across the  [proposed]                                                               
bridge, then Wasilla would only  have the less frequent passenger                                                               
trains, which may solve the problem.                                                                                            
                                                                                                                                
CO-CHAIR GATTO  said the  gas line  is at  least six  years away,                                                               
"and I can't imagine what that intersection will look like."                                                                    
                                                                                                                                
2:23:14 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE said the railroad  will continue the feasibility study                                                               
of that  intersection, but surmised  it will take "an  ugly scene                                                               
at that crossing  to trigger some action."  It  is a city problem                                                               
and  a  borough  solution,  and  things are  stymied.    He  said                                                               
SAFETEA-LU  allowed the  railroad  a 6-fold  increase in  federal                                                               
entitlements.   The federal funds  are guaranteed  in perpetuity,                                                               
so the  full faith  in credit  of the Alaska  Railroad is  not at                                                               
risk.   He said the railroad  will spend that money,  "whether we                                                               
spend it  on debt  service or whether  we spend  it incrementally                                                               
over  a extended  period of  time."   The cost  of materials  are                                                               
going up, so  the purchases can be  made in bulk and  stored.  He                                                               
said passenger  service is increasing,  requiring the line  to be                                                               
safe  and smooth.    There will  be no  impact  to other  capital                                                               
programs, he stated.                                                                                                            
                                                                                                                                
2:26:30 PM                                                                                                                    
                                                                                                                                
REPRESENTATIVE THOMAS said, so this won't extend the railroad?                                                                  
                                                                                                                                
MR. GAMBLE said no.                                                                                                             
                                                                                                                                
CO-CHAIR GATTO asked the distance to any Canadian rail line.                                                                    
                                                                                                                                
MR. GAMBLE said it is about 1,000 miles to their railroad.                                                                      
                                                                                                                                
2:27:09 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE  said the  proposed financing is  up to  $165 million,                                                               
with three bond  sales over the next six years.   Each would have                                                               
to be  approved by  the railroad  board of  directors.   The year                                                               
with the  largest debt service  would be 49 percent  of available                                                               
funds.    He said  if  Senator  Ted  Stevens gives  the  railroad                                                               
another earmark, "we would see the  need for that $165 million to                                                               
come  down to  a lower  number;  the debt  service would  reflect                                                               
that."   He sees  no event  that would  have the  railroad coming                                                               
back to the legislature for more money.                                                                                         
                                                                                                                                
CO-CHAIR  GATTO  said  the  Europeans   have  been  using  welded                                                               
railroads  since he  learned how  to walk,  and they  have bullet                                                               
trains.  He predicted a savings for using welded railroads.                                                                     
                                                                                                                                
2:30:52 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE  said the railroad  workers are local, "and  there's a                                                               
momentum there...that is not refreshed  from the outside."  There                                                               
was  a resistance  to  going  to welded  rails.    Now there  are                                                               
experienced outside workers with a host of new ideas, he said.                                                                  
                                                                                                                                
CO-CHAIR ELKINS asked if the rails are longer when welded.                                                                      
                                                                                                                                
MR. GAMBLE  said yes;  they are built  to half-mile  lengths, and                                                               
the  curve is  put into  it.   The concrete  tie holds  it.   The                                                               
acuteness of  the curves has  been reduced, he added.   Therefore                                                               
the average velocity has gone up steadily.                                                                                      
                                                                                                                                
2:34:45 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE said  the railroad gets very  little homeland security                                                               
money.  It all goes to the state, he noted.                                                                                     
                                                                                                                                
REPRESENTATIVE NEUMAN  referred to  the mainline  density history                                                               
and  the million  gross tons  from  Portage to  Anchorage and  to                                                               
Matanuska-Susitna.  He asked if that  would change if there was a                                                               
line  to Pt.  Mackenzie, "assuming  that we  would be  doing coal                                                               
down through  there."   He asked  about the  economic development                                                               
opportunities.                                                                                                                  
                                                                                                                                
2:37:36 PM                                                                                                                    
                                                                                                                                
MR. GAMBLE said he can provide that information.                                                                                
                                                                                                                                
REPRESENTATIVE THOMAS  moved to  report HB  491 out  of committee                                                               
with individual  recommendations and with no  accompanying fiscal                                                               
notes.  There being no objection,  HB 491 was reported out of the                                                               
House Transportation Standing Committee.                                                                                        
                                                                                                                                
ADJOURNMENT                                                                                                                   
                                                                                                                                
There being no  further business before the  committee, the House                                                               
Transportation  Standing  Committee   meeting  was  adjourned  at                                                               
2:39:11 PM.                                                                                                                   

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