Legislature(2003 - 2004)

03/28/2003 09:04 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
                              MINUTES                                                                                         
                     SENATE FINANCE COMMITTEE                                                                                 
                          March 28, 2003                                                                                      
                              9:04 AM                                                                                         
                                                                                                                                
                                                                                                                                
TAPES                                                                                                                       
                                                                                                                                
SFC-03 # 35, Side A                                                                                                             
SFC 03 # 35, Side B                                                                                                             
                                                                                                                              
CALL TO ORDER                                                                                                               
                                                                                                                                
Co-Chair Gary Wilken convened  the meeting at approximately 9:04 AM.                                                            
                                                                                                                                
PRESENT                                                                                                                     
                                                                                                                                
Senator Gary Wilken, Co-Chair                                                                                                   
Senator Lyda Green, Co-Chair                                                                                                    
Senator Con Bunde, Vice Chair                                                                                                   
Senator Lyman Hoffman                                                                                                           
Senator Donny Olson                                                                                                             
Senator Ben Stevens                                                                                                             
Senator Robin Taylor                                                                                                            
                                                                                                                                
Also Attending:  NANCY  SLAGLE, Director, Division of Administrative                                                          
Services, Department  of Transportation  and Public Facilities;  JON                                                            
MACKINNON,  Deputy Commissioner of  Highways and Public Facilities,                                                             
Department of Transportation  and Public Facilities; GEORGE CAPACCI,                                                            
Captain,  General Manager,  Marine  Highways System,  Department  of                                                            
Transportation   and  Public   Facilities;   JEFF  OTTESEN,   Acting                                                            
Director,   Division   of   Statewide   Planning,    Department   of                                                            
Transportation and Public Facilities;                                                                                           
                                                                                                                                
Attending  via  Teleconference:     There  were  no  teleconference                                                           
participants.                                                                                                                   
                                                                                                                                
SUMMARY INFORMATION                                                                                                         
                                                                                                                                
SB 100-APPROP: CAPITAL PROJECTS                                                                                                 
                                                                                                                                
The Committee  heard overviews of the requests of  the Department of                                                            
Transportation   and  Public  Facilities.  The   bill  was  held  in                                                            
Committee.                                                                                                                      
                                                                                                                                
HB  12-HARASSMENT BY ELECTRONIC COMMUNICATION                                                                                   
                                                                                                                                
This bill was scheduled but not heard.                                                                                          
                                                                                                                                
                                                                                                                                
     SENATE BILL NO. 100                                                                                                        
     "An  Act making capital  appropriations  and reappropriations;                                                             
     capitalizing a fund;  making appropriations under art. IX, sec.                                                            
     17(c),   Constitution  of  the   State  of  Alaska,   from  the                                                            
     constitutional   budget reserve  fund;  and  providing  for  an                                                            
     effective date."                                                                                                           
                                                                                                                                
                                                                                                                                
Co-Chair  Wilken  referenced  a  listing  of  deferred  maintenance                                                             
projects  as  requested  at the  previous  hearing.  Other  handouts                                                            
relating  to   discussions  at  the   previous  hearing   were  also                                                            
distributed. [Copies on file.]                                                                                                  
                                                                                                                                
NANCY  SLAGLE,  Director,   Division  of  Administrative   Services,                                                            
Department  of Transportation  and  Public Facilities  detailed  the                                                            
handouts.                                                                                                                       
                                                                                                                                
Ms. Slagle noted the listing  of emergency maintenance projects also                                                            
provided.                                                                                                                       
                                                                                                                                
Ms. Slagle  informed that Department  is preparing responses  to the                                                            
questions regarding capital fund and Chandalar issues.                                                                          
                                                                                                                                
JON  MACKINNON,   Deputy   Commissioner  of   Highways  and   Public                                                            
Facilities,  Department  of Transportation  and  Public Facilities,                                                             
detailed  the  Chandalar project.  He  noted  that labor  costs  are                                                            
higher  and  overtime   costs  are  necessary.  He  furthered   that                                                            
additional  site preparation is required,  as the facility  is to be                                                            
located  on permafrost  and the  hillside surrounding  the  facility                                                            
must be  excavated to allow  for future development.  He also  noted                                                            
construction   costs  statewide   have  increased   15-20   percent,                                                            
particularly  for  mechanical  and  electrical  work due  to  higher                                                            
standards, which  was not accounted for at the time  the project was                                                            
planned.  He also informed  that due to  the increased construction                                                             
activities resulting from  the passage of the bond package, it would                                                            
be more difficult to secure contractors for this project.                                                                       
                                                                                                                                
The Committee  heard overviews on  the main appropriation  items and                                                            
posed  questions  on  specific  allocation   projects  within  those                                                            
appropriations as follows.                                                                                                      
                                                                                                                                
     Statewide Federal Programs                                                                                                 
     $1,500,000 CIP receipts                                                                                                    
     $65,975,000 federal receipts                                                                                               
     $53,871,000 general funds Match (G/F Match)                                                                                
     $412,500 general funds/mental health funds (GF/MH)                                                                         
     $412,500 Mental Health Trust Authority Authorized Receipts                                                                 
     (MHTAAR)                                                                                                                   
     $12,000,000 Statutory Designated Program Receipts (SDPR)                                                                   
     Reference No.: 6764                                                                                                        
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     On-going Project                                                                                                           
     Statewide Programs                                                                                                         
                                                                                                                                
Mr. MacKinnon  noted  the general  fund match  requirement for  this                                                            
item is approximately $54 million.                                                                                              
                                                                                                                                
Ms.  Slagle  spoke  to  the  general  fund/mental   health  receipts                                                            
included in  this item, explaining  these funds are specific  to the                                                            
coordinated  transportation  and vehicles  program,  which  provides                                                            
assistance  for  non-profit   organizations  to  provide   transport                                                            
vehicles in local communities.                                                                                                  
                                                                                                                                
Ms. Slagle  pointed out this item  includes the Airport Improvement                                                             
Programs and federal highway  programs, and the amounts are based on                                                            
the estimated  amount  of federal  appropriation.  She shared  these                                                            
figures are "cautiously optimistic."                                                                                            
                                                                                                                                
     Airport Improvement Program                                                                                                
     $143,581,163 federal receipts                                                                                              
     $12,468,800 International Airport funds                                                                                    
     Reference No.: 7470                                                                                                        
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     On-going Project                                                                                                           
     Federal airport improvements as outlined in the Airport                                                                    
     Improvement Program and the International Airports Program.                                                                
                                                                                                                                
Mr.  MacKinnon listed  variety  of projects  undertaken  with  these                                                            
funds including: equipment  buildings, lighting systems, and airport                                                            
taxiway improvements.                                                                                                           
                                                                                                                                
Senator Olson  asked whether this item includes any  funding for the                                                            
Ted Stevens Anchorage International Airport.                                                                                    
                                                                                                                                
Ms. Slagle responded  this item does not include any  appropriations                                                            
for the  Anchorage airport,  as negotiations  are underway  with the                                                            
airlines   association   with  regard   to  funding   for   terminal                                                            
modifications  and other projects included in the  five-year Capital                                                            
Improvement  Project (CIP). She anticipated  an amendment  to the FY                                                            
04 capital  budget  would  be submitted  once the  negotiations  are                                                            
completed.                                                                                                                      
                                                                                                                                
     Federal Emergency Projects                                                                                                 
     $25,000,000 federal receipts                                                                                               
     Reference No.: 38424                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     One-Time Project                                                                                                           
     Emergency  funds from  the Federal  Highway Administration  for                                                            
     declared  emergencies. Within 180 days funded  at 100% federal;                                                            
     after  that, about  9% State match  is needed.  May be  used to                                                            
     address  issues of  emergency  nature with  federal airport  or                                                            
     highway formula funds.                                                                                                     
                                                                                                                                
And                                                                                                                             
                                                                                                                                
     Federal Contingency Projects                                                                                               
     $15,000,000 federal receipts                                                                                               
     Reference No.: 31376                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     On-going Project                                                                                                           
     Special   national  discretionary   funding  for  highways   or                                                            
     airports  may be accepted  through this  appropriation.  May be                                                            
     used  to  address  issues  of  emergency  nature  with  federal                                                            
     airport  or highway formula funds.  Also used in cases  where a                                                            
     revised program is not feasible.                                                                                           
                                                                                                                                
Senator B.  Stevens asked if this  request for receipt authority  is                                                            
in anticipation of projects.                                                                                                    
                                                                                                                                
Ms. Slagle  affirmed this item is  intended to cover any  unexpected                                                            
emergencies,  such  as  floods or  earthquakes.  She  informed  that                                                            
additional  funds could be  requested to  address earthquake  damage                                                            
near Tok  as more  damage is  discovered. She  listed the  estimated                                                            
cost of damage resulting from the earthquake at $60 million.                                                                    
                                                                                                                                
Senator B. Stevens asked  the total appropriation in FY 03 for those                                                            
items, including supplemental appropriations.                                                                                   
                                                                                                                                
Ms. Slagle could not speak  to specific amounts, explaining that the                                                            
funds have  also been utilized  for some  cost overruns. She  stated                                                            
that all funds appropriated in FY 03 have been expended.                                                                        
                                                                                                                                
Senator  B. Stevens  asked if the  funding source  appropriated  for                                                            
contingency projects is  the same as that appropriated for emergency                                                            
projects.                                                                                                                       
                                                                                                                                
Ms.  Slagle replied  that  the funding  sources are  different.  She                                                            
stated  that in  the past  the funding  has been  combined into  one                                                            
request,  although  it has  been  determined  the two  items  should                                                            
become separate.                                                                                                                
                                                                                                                                
Senator Bunde  asked if federal regulations permit  cost overruns of                                                            
the contingency projects to be treated as emergency projects.                                                                   
                                                                                                                                
Ms. Slagle  answered no,  which she stated  is the reason the  items                                                            
are  separated.  She explained  that  federal  government  does  not                                                            
require separate accounting,  although it allows for better tracking                                                            
within the Department.                                                                                                          
                                                                                                                                
Senator Hoffman  requested the complete  funding amount anticipated                                                             
in FY 04 for  the Airport Improvement  Program, Reference  No. 7470.                                                            
                                                                                                                                
     Alaska International Airport System: Development Fund                                                                      
     $6,000,000 International Airport funds                                                                                     
     Reference No.: 38425                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     On-going Project                                                                                                           
     These  funds may be  used for design  and construction  of both                                                            
     exclusive-use  and common-use  AIAS projects.  The funds  allow                                                            
     for  timely response  to airport tenant  development needs  and                                                            
     are  required  by  the operating  agreement  in  place  between                                                            
     signatory air carriers and DOTPF/AIAS.                                                                                     
                                                                                                                                
Senator Hoffman  noting fluctuation  in previous appropriations  for                                                            
this item asked  whether communities  submit requests for  projects.                                                            
                                                                                                                                
Ms.  Slagle replied  this  request  is in  line with  the  operating                                                            
agreement with airlines  to address particular items. She stated she                                                            
would  provide an  accounting of  how funds  spent in  the past  and                                                            
planned expenditures.                                                                                                           
                                                                                                                                
Senator Olson asked whether  the source of funding for this item and                                                            
Reference No. 7470 is revenues or general funds.                                                                                
                                                                                                                                
Ms. Slagle  replied the $6  million for this  item is International                                                             
Airport Revenue funds generated  from landing fees, lease fees, etc.                                                            
                                                                                                                                
Senator Olson asked if these projects involve general funds.                                                                    
                                                                                                                                
Ms. Slagle answered they do not.                                                                                                
                                                                                                                                
Senator  Olson  asked  about  the  $12  million  appropriation   for                                                            
Reference No. 7470.                                                                                                             
                                                                                                                                
Ms. Slagle explained  that the item represents a summary  of several                                                            
projects including Reference No. 38425.                                                                                         
                                                                                                                                
     Bethel: Safety, Taxiway, Apron and Road Improvement                                                                        
     $6,600,000 federal receipts                                                                                                
     Reference No.: 38409                                                                                                       
     Category: Transportation                                                                                                   
     Location: Bethel                                                                                                           
     Election District: Bethel                                                                                                  
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     Phased - New Project                                                                                                       
     Expand  runway   18-36  safety  area;  construct   new  general                                                            
     aviation  apron, taxiways and  access road; expand old  general                                                            
     aviation  apron as  a new air  taxi apron;  expand the  exiting                                                            
     north  air   taxi  apron  and  add  new  highway   access  road                                                            
     connection;  extend taxiway M to runway 18-36.  Initial project                                                            
     scoping phase will define State 1 scope of work.                                                                           
                                                                                                                                
Senator Bunde  asked if the  proposed air  taxi apron would  include                                                            
areas for aircraft tie-downs  and the fees to utilize the tie-downs.                                                            
                                                                                                                                
Ms. Slagle responded  that the project would include  tie-downs, but                                                            
did not know the cost.                                                                                                          
                                                                                                                                
Senator Bunde  commented that no fees  are charged for tie-downs  at                                                            
the Anchorage  airport  and suggested  the Department  research  the                                                            
matter.                                                                                                                         
                                                                                                                                
Ms. Slagle assumed  that with implementation of changes  to aviation                                                            
revenue,  this would be  considered. She  stated the Department  was                                                            
undergoing efforts to match agreements with fair market values.                                                                 
                                                                                                                                
Senator Olson  commented that  liability could  be increased  in the                                                            
event of damage caused from use or failure of the tie-downs.                                                                    
                                                                                                                                
Senator  Bunde suggested  aircraft  owners should  utilize the  tie-                                                            
downs at their own risk.                                                                                                        
                                                                                                                                
Senator  Taylor understood  international airport  receipts  are not                                                            
dedicated  but  rather  are  general funds.  He  remarked  that  the                                                            
legislature  has  full  authority  to  expend  those  funds  at  its                                                            
discretion.  He spoke of  the historical  protection of those  funds                                                            
and  the ability  of  airlines to  negotiate  the amounts  they  are                                                            
willing  to pay  for landing  fees based  on the  improvements  they                                                            
want.                                                                                                                           
                                                                                                                                
Ms.  Slagle   stated  that   the  international   airport   fund  is                                                            
established  in statue  as an enterprise  fund  for operational  and                                                            
capital expenses  of airports.  She warned  that receipt of  federal                                                            
funds could be jeopardized  if they were diverted to other purposes.                                                            
                                                                                                                                
Senator Bunde clarified  that he did not intend to single out Bethel                                                            
in his comments,  as other improvements  elsewhere in the  State are                                                            
planned.                                                                                                                        
                                                                                                                                
     Anchorage Metropolitan Area Transportation System (AMATS)                                                                  
     Projects                                                                                                                   
     $68,734,000 federal receipts                                                                                               
     Reference No.: 38515                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Anchorage Metropolitan Area Transportation System (AMATS)                                                                  
     Projects                                                                                                                   
                                                                                                                                
Mr. MacKinnon  defined this item as  those projects planned  for the                                                            
Anchorage area.                                                                                                                 
                                                                                                                                
     Surface Transportation Program                                                                                             
     $350,000 CIP Receipts                                                                                                      
     $414,742,600 federal receipts                                                                                              
     $1,000,000 general funds                                                                                                   
     Reference No.: 32610                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     On-going Project                                                                                                           
     Federal surface transportation  improvements as outlined in the                                                            
     Statewide   Transportation  Improvement  Program   (STIP),  the                                                            
     Transportation  Equity Act for  the 21st Century (TEA-21),  and                                                            
     annual federal appropriations acts.                                                                                        
                                                                                                                                
Mr. MacKinnon outlined this item.                                                                                               
                                                                                                                                
     Alaska Marine Highway: Juneau-Petersburg Fast Vehicle Ferry                                                                
     $40,000,000 federal receipts                                                                                               
     Reference No.: 38466                                                                                                       
     Category: Transportation                                                                                                   
     Location: Southeast Alaska                                                                                                 
     Election District: Southeast Districts 1-5                                                                                 
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     One-time Project                                                                                                           
     Design and build a Fast Vehicle Ferry for the Juneau-                                                                      
     Petersburg day ferry service. An element of the Southeast                                                                  
     Plan.                                                                                                                      
                                                                                                                                
And                                                                                                                             
                                                                                                                                
     Alaska Marine Highway: Ketchikan-Wrangell-South Mitkof Fast                                                                
     Vehicle Ferry                                                                                                              
     $28,000,000 federal receipts                                                                                               
     Reference No.: 38465                                                                                                       
     Category: Transportation                                                                                                   
     Location: Southeast Alaska                                                                                                 
     Election District: Southeast Districts 1-5                                                                                 
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     One-time Project                                                                                                           
     Design and build a Fast Vehicle Ferry for the Ketchikan-                                                                   
     Wrangell day ferry service. Sister ship to Sitka fast vehicle                                                              
     ferry. An element of the Southeast Plan.                                                                                   
                                                                                                                                
Senator  Taylor noted  none of the  proposed fast  ferries had  been                                                            
constructed  and relayed  the  Southeast Conference  recommendation                                                             
that  the  first  vessel  operate  for  two  years  to  measure  its                                                            
effectiveness   before  additional  vessels  were  constructed.   He                                                            
exclaimed that  the fast ferry project  for British Columbia  Canada                                                            
failed.                                                                                                                         
                                                                                                                                
GEORGE CAPACCI,  Captain, General  Manager, Marine Highways  System,                                                            
Department of  Transportation and Public Facilities,  countered that                                                            
the  Alaska project  is completely  different  than  the project  in                                                            
British Columbia. He told  of similar vessels successfully operating                                                            
in the  Irish Sea  under harsher  conditions. He  reminded that  the                                                            
intent  is that  the Alaska  ferries  would  not earn  a profit  and                                                            
stressed that the Alaska  Marine Highway fleet would not be entirely                                                            
replaced by  fast ferries, but rather  a combination of traditional                                                             
and fast ferries would be utilized.                                                                                             
                                                                                                                                
Senator Olson asked the displacement of these vessels.                                                                          
                                                                                                                                
Mr.  Capacci  responded  that  larger  and  faster  ferries  operate                                                            
elsewhere in the world,  and the proposed smaller vessels would meet                                                            
the needs in Alaska.                                                                                                            
                                                                                                                                
Co-Chair  Wilken  asked  about the  British  Columbia  fast  ferries                                                            
program.                                                                                                                        
                                                                                                                                
Mr. Capacci  explained that speed  is a necessity for Alaska,  while                                                            
is only a "luxury" for British Columbia.                                                                                        
                                                                                                                                
     Alaska Marine Highway: Saxman Terminal                                                                                     
     $1,400,000 federal receipts                                                                                                
     Reference No.: 38327                                                                                                       
     Category: Transportation                                                                                                   
     Location: Saxman                                                                                                           
     Election District: Ketchikan                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     One-time Project                                                                                                           
     Construct a terminal in the vicinity of Saxman to accommodate                                                              
     shuttle ferry operations from Annette Island.                                                                              
                                                                                                                                
Senator  Bunde questioned  the need  for a new  facility located  in                                                            
Saxman and  asked why the existing  Ketchikan terminal could  not be                                                            
utilized.                                                                                                                       
                                                                                                                                
Mr. Capacci noted Saxman  is closer to Annette Island and stated the                                                            
location  of  a terminal  in  Saxman  would  relieve  congestion  in                                                            
downtown Ketchikan.                                                                                                             
                                                                                                                                
Senator Bunde asked the  number of people whom this new vessel would                                                            
serve.                                                                                                                          
                                                                                                                                
Mr. Capacci replied  that Metlakatla, located on Annette  Island, is                                                            
a small community.                                                                                                              
                                                                                                                                
Co-Chair  Wilken acknowledged  this  has been  an  issue of  Senator                                                            
Taylor's  for  many  years  and  requested  the  Department  provide                                                            
additional information and assistance to Senator Taylor.                                                                        
                                                                                                                                
Senator Taylor  asserted these  funds could  construct roads  in his                                                            
district  with small  ferries  as connectors.  He  charged that  the                                                            
Department  is  keeping  communities  isolated.  He  challenged  the                                                            
comparisons to the British Columbia fast ferry program.                                                                         
                                                                                                                                
AT EASE 9:48 AM / 9:49 AM                                                                                                       
                                                                                                                                
     King Cove and Cold Bay Hovercraft Terminals                                                                                
     $6,000,000 federal receipts                                                                                                
     Reference No.: 38470                                                                                                       
     Category: Transportation                                                                                                   
     Location: Southwest Alaska                                                                                                 
     Election District: Southwest Districts 36-38                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     Phased-underway Project                                                                                                    
     Construct hovercraft terminals near King Cove and at Cold                                                                  
     Bay's all-season airport. The terminal access road is funded.                                                              
                                                                                                                                
Senator Hoffman asked the  current status of this project to provide                                                            
assess between  King Cove and Cold  Bay and whether the communities                                                             
support the project.                                                                                                            
                                                                                                                                
JEFF  OTTESEN,  Acting Director,  Division  of  Statewide  Planning,                                                            
Department of  Transportation and Public Facilities,  responded that                                                            
the  two  communities   were  pursuing  this  project   utilizing  a                                                            
hovercraft  and partial  roadways  "reluctantly"  with the  ultimate                                                            
goal  of  connecting  the  communities  entirely  with  a  road.  He                                                            
emphasized  this is not  a Department of  Transportation and  Public                                                            
Facilities project.                                                                                                             
                                                                                                                                
Senator Hoffman asked if  this appropriation would provide the final                                                            
funding for this project.                                                                                                       
                                                                                                                                
Mr. Ottesen understood it would.                                                                                                
                                                                                                                                
Senator Olson  asked if other hovercrafts  were currently  operating                                                            
in this location.                                                                                                               
                                                                                                                                
Mr. Ottesen  responded that  currently one  hovercraft is  operating                                                            
and a second vessel  is under consideration. He explained  the water                                                            
conditions and the absence of a breakwater.                                                                                     
                                                                                                                                
     North Denali Access Study Engineering Support                                                                              
     $250,000 federal receipts                                                                                                  
     Reference No.: 38464                                                                                                       
     Category: Transportation                                                                                                   
     Location: Denali Borough                                                                                                   
     Election District: Unidentified Election District                                                                          
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     One-time Project                                                                                                           
     Departmental engineering support of the North Denali Access                                                                
     study being undertaken by the Denali Borough with TEA-21 High                                                              
     Priority funds.                                                                                                            
                                                                                                                                
                                                                                                                                
SFC 03 # 35, Side B 09:52 AM                                                                                                    
                                                                                                                                
                                                                                                                                
Co-Chair  Wilken asked  how  these funds  relate  to other  projects                                                            
underway in this area.                                                                                                          
                                                                                                                                
Mr. Ottesen told of efforts  to allocate funds to the Denali Borough                                                            
with the intent  the Borough would assume leadership  of the project                                                            
and estimated this item  is related. He stated he would research the                                                            
matter and provide information to the Committee.                                                                                
                                                                                                                                
Co-Chair  Wilken  surmised  the  Borough  is using  these  funds  to                                                            
"torpedo the project".                                                                                                          
                                                                                                                                
     North Slope Oilfield Connector Roads and Colville River Bridge                                                             
     $1,000,000 general funds                                                                                                   
     Reference No.: 38460                                                                                                       
     Category: Transportation                                                                                                   
     Location: Nuiqsut                                                                                                          
     Election District: Arctic                                                                                                  
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     Develop  industrial use roads  to provide all season  access to                                                            
     new oilfield  exploration/production  areas in and near  NPR-A.                                                            
     It also  provides important all-season  access for the  village                                                            
     of Nuiqsut.                                                                                                                
                                                                                                                                
Co-Chair Wilken  asked why this project is not funded  with National                                                            
Petroleum  Reserve  - Alaska  (NPR-A)  receipts.  He  requested  Mr.                                                            
Ottesen research the matter.                                                                                                    
                                                                                                                                
Mr. Ottesen told  of the limited number of operating  days currently                                                            
available on the ice roads.                                                                                                     
                                                                                                                                
Co-Chair  Wilken focused  on  the funding  source  and directed  the                                                            
Department to investigate utilizing NPR-A receipts.                                                                             
                                                                                                                                
     Surface Transportation Preconstruction                                                                                     
     $75,000,000 federal receipts                                                                                               
     Reference No.: 36366                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     Phased Project                                                                                                             
     Funding for preliminary engineering costs and Right of Way and                                                             
     utility costs less than $750,000.                                                                                          
                                                                                                                                
Senator Hoffman  asked how much of the appropriation  is to purchase                                                            
right of ways.                                                                                                                  
                                                                                                                                
Mr. Ottesen  explained that every  year right of way costs  vary for                                                            
each project and are difficult to predict.                                                                                      
                                                                                                                                
Senator  Hoffman understood,  but pointed  out that  an estimate  is                                                            
necessary to prepare a funding request.                                                                                         
                                                                                                                                
Mr. Ottesen indicated  the right of way estimate is  included in the                                                            
Statewide Transportation Improvement Program (STIP)                                                                             
                                                                                                                                
Senator Hoffman asked whether  specific right of ways are identified                                                            
for purchase using this appropriation.                                                                                          
                                                                                                                                
     Five Finger Lighthouse Access Improvements                                                                                 
     $245,000 federal receipts                                                                                                  
     Reference No.: 38317                                                                                                       
     Category: Transportation                                                                                                   
     Location: Kake                                                                                                             
     Election District: Cordova/Southeast Islands                                                                               
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     One-time Project                                                                                                           
     Establish a pedestrian  access to the Five Finger Lighthouse by                                                            
     constructing  a ramp  with tram  for lifting  boats and  people                                                            
     safely  from tidewater  to the  concrete  deck surrounding  the                                                            
     lighthouse.                                                                                                                
                                                                                                                                
Senator Taylor asked who owns the lighthouse.                                                                                   
                                                                                                                                
Mr. Ottesen responded that  a nonprofit association has acquired the                                                            
lighthouse and either owns or leases the facility.                                                                              
                                                                                                                                
Senator Taylor understood  a nonprofit organization plans to operate                                                            
a bed and breakfast  at the facility  and commented on the  proposal                                                            
that the State expend $250,000 to enable this venture.                                                                          
                                                                                                                                
Co-Chair Wilken requested further detail on this item.                                                                          
                                                                                                                                
     Northern Region: Winter Trail Markings                                                                                     
     $258,500 federal receipts                                                                                                  
     Reference No.: 36443                                                                                                       
     Category: Transportation                                                                                                   
     Location: Central Alaska                                                                                                   
     Election District: Central Districts 6-11                                                                                  
     Estimated Project Dates: 07/01/2003 - 06/30/2008                                                                           
     State Match Required                                                                                                       
     Phased Project                                                                                                             
     Mark overland winter trails in Northern Region with permanent                                                              
     trail markers. Trail markers will ensure winter travelers can                                                              
     safely journey between communities in the area.                                                                            
                                                                                                                                
Senator Olson  asked the location  of these markers and whether  the                                                            
funding  amount in  this request  would  be adequate  to ensure  the                                                            
safety of travelers.                                                                                                            
                                                                                                                                
Mr.  Ottesen  described  the  on-going  project to  mark  areas.  He                                                            
informed that  user groups are assisting in the installation  of the                                                            
markers and surmised the  amount of funding in this request would be                                                            
adequate in context to previous appropriations.                                                                                 
                                                                                                                                
     Federal Aid Highway Program Match from Bond Interest Earnings                                                              
     $2,250,000 Northern Tobacco Securitization Corporation (NTSC)                                                              
     Bond                                                                                                                       
     Reference No.: 38523                                                                                                       
     Category: Transportation                                                                                                   
     Location: Statewide                                                                                                        
     Election District: Statewide                                                                                               
     Estimated Project Dates: 07/01/2004 - 06/30/2009                                                                           
     Replaces federal and highway general fund match with Northern                                                              
     Tobacco Securitization Corporation investment earnings on bond                                                             
     proceeds.                                                                                                                  
                                                                                                                                
Mr. MacKinnon  explained  this item  relates to  the replacement  of                                                            
general   funds  with  tobacco   settlement   funds  as  the   match                                                            
requirement for highway projects.                                                                                               
                                                                                                                                
Co-Chair Wilken asked the purpose of this fund source change.                                                                   
                                                                                                                                
Co-Chair Wilken encouraged  members to further review the Department                                                            
of Transportation and Public Facilities budget requests.                                                                        
                                                                                                                                
Senator Bunde  recommended the Department  provide more information                                                             
on request items in future years.                                                                                               
                                                                                                                                
Co-Chair Wilken  agreed. He noted  the Chandalar project  would be a                                                            
multiple year appropriation.                                                                                                    
                                                                                                                                
Co-Chair Green  commented to the "heart"  of transportation  system.                                                            
She  charged  that the  signage  requirements  of  small  businesses                                                            
located along the road  system have been negatively impacted further                                                            
by  Department  inspections.  She  informed  she  would  review  the                                                            
proposed budget to ensure relief is provided to these businesses,                                                               
calling the Department's actions "a crime".                                                                                     
                                                                                                                                
ADJOURNMENT                                                                                                                 
                                                                                                                                
Co-Chair Gary Wilken adjourned the meeting at 10:05 AM                                                                          

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