Legislature(2009 - 2010)SENATE FINANCE 532

03/16/2009 09:00 AM Senate FINANCE

Download Mp3. <- Right click and save file as

Audio Topic
09:03:38 AM Start
09:10:21 AM SB75
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
Heard & Held
Department of Transportation and Public
+ Bills Previously Heard/Scheduled TELECONFERENCED
                  SENATE FINANCE COMMITTEE                                                                                      
                       March 16, 2009                                                                                           
                         9:03 a.m.                                                                                              
9:03:38 AM                                                                                                                    
CALL TO ORDER                                                                                                                 
Co-Chair Stedman called the Senate  Finance Committee meeting                                                                   
to order at 9:03 a.m.                                                                                                           
MEMBERS PRESENT                                                                                                               
Senator Lyman Hoffman, Co-Chair                                                                                                 
Senator Bert Stedman, Co-Chair                                                                                                  
Senator Johnny Ellis                                                                                                            
Senator Donny Olson                                                                                                             
Senator Joe Thomas                                                                                                              
MEMBERS ABSENT                                                                                                                
Senator Charlie Huggins, Vice-Chair                                                                                             
ALSO PRESENT                                                                                                                  
Nancy Slagle, Director, Division  of Administrative Services,                                                                   
Department  of  Transportation  and  Public  Facilities;  Jim                                                                   
Beedle,  Deputy   Commissioner,  Marine  Operations,   Marine                                                                   
Highway  System,  Department  of  Transportation  and  Public                                                                   
Facilities; Frank  Richards, Deputy Commissioner,  Highways &                                                                   
Public Facilities,  Department  of Transportation and  Public                                                                   
SB 75     "An Act making and amending appropriations,                                                                           
          including capital appropriations, supplemental                                                                        
          appropriations, and appropriations to capitalize                                                                      
          funds; and providing for an effective date."                                                                          
          SB 75 was HEARD and HELD in Committee for further                                                                     
SENATE BILL #75                                                                                                               
     "An Act  making and  amending appropriations,  including                                                                   
     capital  appropriations,   supplemental  appropriations,                                                                   
     and appropriations  to capitalize  funds; and  providing                                                                   
     for an effective date."                                                                                                    
RECESSED:      9:10:21 AM                                                                                                     
RECONVENED:   9:22:34 AM                                                                                                      
9:23:23 AM                                                                                                                    
DEPARTMENT OF TRANSPORTATION AND PUBLIC FACILITIES                                                                              
NANCY SLAGLE, DIRECTOR, DIVISION  OF ADMINISTRATIVE SERVICES,                                                                   
DEPARTMENT  OF TRANSPORTATION  AND  PUBLIC FACILITIES  stated                                                                   
that  the requested  funds  address deferred  maintenance  on                                                                   
vessels  and facilities  for the Alaska  Marine Highway.  The                                                                   
administration  introduced approximately  $40 million  in top                                                                   
priority projects for the vessels.  The listing of facilities                                                                   
includes   16  state  owned   terminals  requiring   deferred                                                                   
maintenance. She mentioned maintenance  required for mooring,                                                                   
electrical  systems, and  the air handling  systems  for life                                                                   
Co-Chair  Stedman  noted that  historically  the  legislature                                                                   
approved two appropriations,  one for shore side  and one for                                                                   
vessel maintenance.  He noticed  the budgetary reduction  and                                                                   
the unchanged  backup. He requested  the plan  addressing the                                                                   
reduction  and   wished  to  understand   the  appropriations                                                                   
Ms. Slagle answered  that a typical request  is for inclusion                                                                   
versus separation  of appropriation.  The lists presented  to                                                                   
the committee  are in  priority order, providing  flexibility                                                                   
to shift between  types of projects. The reduced  funds limit                                                                   
the priority  list accomplishments,  leading to the  delay of                                                                   
some deferred maintenance projects.                                                                                             
Co-Chair Stedman  understood that the requests  were combined                                                                   
this  year.  Ms.  Slagle  responded  that  the  appropriation                                                                   
received  this year was  separated although  the request  was                                                                   
for one appropriation.                                                                                                          
Co-Chair  Stedman   understood  that  most   departments  and                                                                   
governors  prefer one  appropriation. He  noted concern  over                                                                   
minimizing appropriations.                                                                                                      
9:26:58 AM                                                                                                                    
Reference Number 42001                                                                                                        
Ms. Slagle  discussed reference  number 42001, (page  7), The                                                                   
Alaska  Marine  Highway  (AMH) System  "Vessel  and  Facility                                                                   
Deferred  Maintenance," and  reference number  30624 and  the                                                                   
AMH Vessel  and Terminal  Overhaul and Rehabilitation,  which                                                                   
is  an attempt  to  overhaul the  Marine  Highway vessels  to                                                                   
ensure  optimal  performance.   The  overhaul  work  includes                                                                   
certification requirements for  each of the vessels, ensuring                                                                   
proper  function  in  all  areas.   One  area  of  particular                                                                   
consideration is life boat assessment.                                                                                          
Co-Chair Stedman  asked to know the projects  eliminated as a                                                                   
result  of the budget  reduction. Ms.  Slagle responded  that                                                                   
areas  of   passenger  services,  security   items,  computer                                                                   
replacement, and  terminal work are eliminated,  prioritizing                                                                   
on the vessels themselves.                                                                                                      
Co-Chair  Stedman  voiced  that the  concentration  of  funds                                                                   
taken from  the original  request include  $8.87 million  for                                                                   
the purpose of vessel overhaul. Ms. Slagle concurred.                                                                           
9:29:32 AM                                                                                                                    
Reference Number 6391                                                                                                         
Ms.   Slagle  described   appropriation   number  6391,   the                                                                   
Americans  with  Disabilities  Act Compliance  Projects.  She                                                                   
stated  that  an  annual  request of  $595  thousand  is  for                                                                   
deconstruction of physical barriers  to state facilities. The                                                                   
list of  projects is lengthy  and provides accessibility  for                                                                   
physically disadvantaged citizens.                                                                                              
Co-Chair   Stedman  revisited   the  previous   appropriation                                                                   
request. He pointed out that the  Northern route of the inner                                                                   
island ferry  between Coffman Cove, Petersburg,  and Wrangell                                                                   
will not  run this  year. He  asked if  the change  presented                                                                   
budgetary issues to put the facilities  associated with these                                                                   
communities  in  remission.  He  asked  the  administration's                                                                   
position on this issue.                                                                                                         
JIM BEEDLE,  DEPUTY COMMISSIONER,  MARINE OPERATIONS,  MARINE                                                                   
HIGHWAY  SYSTEM,  DEPARTMENT  OF  TRANSPORTATION  AND  PUBLIC                                                                   
FACILITIES  explained  that the  dock  in Petersburg  is  the                                                                   
state's  responsibility   but  the  Petersburg   terminal  is                                                                   
temporary and  belongs to the  Inter Island Ferry  (IFA). The                                                                   
Coffman cove site  belongs to the community  of Coffman cove.                                                                   
The dock  side is maintained by  the state, but  the terminal                                                                   
belongs to IFA.                                                                                                                 
Co-Chair  Stedman summarized  that the  terminal and  dock in                                                                   
Coffman  Cove was  a responsibility  of  that community.  Mr.                                                                   
Beedle agreed and mentioned that  if the community of Coffman                                                                   
Cove desired  to relinquish  the property  to the state  then                                                                   
maintenance  would be  the state's  responsibility.  Co-Chair                                                                   
Stedman recalled the high expense  of the facility in Coffman                                                                   
cove and he wished to prevent disrepair during vacancy.                                                                         
9:32:43 AM                                                                                                                    
Reference Number 32534                                                                                                        
Ms.  Slagle introduced  the next  project  for discussion  as                                                                   
reference number  32534. She noted the  appropriation request                                                                   
as $1.5 million  in Critical Infrastructure  Protection (CIP)                                                                   
receipts  for  the  Capital  Improvement   Program  Equipment                                                                   
Replacement.   The  funds  purchase   equipment  to   support                                                                   
construction projects. Equipment  purchased includes copiers,                                                                   
plotters, computers, computer software, etc.                                                                                    
Reference Number 30648                                                                                                        
Ms. Slagle  introduced reference  number 30648, $1.1  million                                                                   
for the Coordinated Transportation  and Vehicles Program. She                                                                   
stated  that $800  thousand  from the  general  fund and  the                                                                   
mental  health  trust provides  transportation  services  for                                                                   
mental health  trust beneficiaries  including vans  and other                                                                   
required transportation methods.                                                                                                
9:34:40 AM                                                                                                                    
Reference Number 46709                                                                                                        
Ms. Slagle addressed reference  number 46709 for a $1,150,000                                                                   
general fund  match request matching  funds from the  Corp of                                                                   
Engineers-Harbor  Program.  The  Saint  Paul  Harbor  Project                                                                   
provides the  match funds necessary  to assure that  the Core                                                                   
of Engineers project  is initiated in Saint  Paul Harbor. She                                                                   
mentioned match  money for feasibility  studies to  work with                                                                   
communities in helping determine potential future projects.                                                                     
Co-Chair Stedman  asked about the community  of Savoonga. Mr.                                                                   
Beedle  responded that  he lacked  the specific  information,                                                                   
but promised to provide it to the committee.                                                                                    
Reference Number 47534                                                                                                        
Ms.  Slagle continued  with  reference  number  47534 for  $3                                                                   
million in general  funds requested for bridge  design on the                                                                   
Seward Highway.  The Ptarmigan Creek, Falls Creek,  and Trail                                                                   
River bridges  require repair. General obligation  bond funds                                                                   
enabled   emergency   repairs,   but  the   bridges   require                                                                   
Co-Chair Stedman  touched on the bond issue,  and he wondered                                                                   
if  the projects  qualify  for  federal funding.  Ms.  Slagle                                                                   
stated  that the  bonds provide  immediate  repairs to  allow                                                                   
traffic to continue.                                                                                                            
FRANK  RICHARDS,  DEPUTY  COMMISSIONER,   HIGHWAYS  &  PUBLIC                                                                   
FACILITIES,   DEPARTMENT   OF   TRANSPORTATION   AND   PUBLIC                                                                   
FACILITIES, explained  the plans for the Ptarmigan  and Falls                                                                   
Creek bridges  involve Bailey  bridge structures  constructed                                                                   
over the existing bridges. He  explained the intention to use                                                                   
general bonds.                                                                                                                  
Co-Chair Stedman  asked why the  projects were not  listed in                                                                   
the   federal  fund   category.   Why  were   federal   funds                                                                   
supplanting general funds?                                                                                                      
9:38:37 AM                                                                                                                    
Mr.  Richards responded  that  the challenge  with the  State                                                                   
Transportation Improvement  Program (STIP) funds  is that the                                                                   
bridge  category  is a  "stovepipe"  and funds  received  are                                                                   
specifically identified for bridges.  He explained that other                                                                   
bridges  remain in  the queue  with STIP  funds allocated  to                                                                   
them. The  general fund  request would  enable repair  of the                                                                   
Ptarmigan and Falls Creek bridges in the timeliest fashion.                                                                     
Co-Chair  Stedman asked  why the  Ptarmigan  and Falls  Creek                                                                   
bridges do  not supplant  other bridges on  the STIP  list if                                                                   
they are in emergency condition.                                                                                                
Mr. Richards  answered  that if  the state  has a project  in                                                                   
progress,  then  the  elimination  of one  project  does  not                                                                   
obligate federal  money to Alaska.  He explained  the process                                                                   
as  a  tenuous mix  and  match  of projects  to  the  funding                                                                   
9:40:39 AM                                                                                                                    
Co-Chair Hoffman asked how reference  number 47534 related to                                                                   
another item  (page 45) requesting  an additional  $1 million                                                                   
for state-wide emergency bridge repair.                                                                                         
Mr. Richards  answered that  the state-wide emergency  bridge                                                                   
repair fund  provides for immediate  response and  actions in                                                                   
the event  of flood or earthquake  damage. This  fund enabled                                                                   
necessary work on the Seward Hwy this year.                                                                                     
Co-Chair  Stedman  suggested  that  General  Obligation  (GO)                                                                   
bonds  may  be  used in  the  future  for  emergency  issues.                                                                   
Bonding projects  are traditionally  used for major  projects                                                                   
or natural disasters.                                                                                                           
Mr.  Richards agreed  that  the discussion  is  welcome.   He                                                                   
acknowledged  that the  state was  fortunate to  have the  GO                                                                   
bonds available, but  if they were not available  then use of                                                                   
the general fund is the next step.                                                                                              
9:43:05 AM                                                                                                                    
Reference Number 30634                                                                                                        
Ms.  Slagle addressed  reference number  30634 and  emergency                                                                   
and non-routine  repairs. She  emphasized that the  reference                                                                   
number  allows  response  to  emergency  disasters  and  non-                                                                   
routine  repairs. She  discussed a  rockslide near  Ketchikan                                                                   
and  the emergent  nature of  the issue  as an  example of  a                                                                   
potential  direction   for  the  funding.   Co-Chair  Stedman                                                                   
declared it fortunate  that no injuries occurred  as a result                                                                   
of the rock slide.                                                                                                              
Reference Number 30632                                                                                                        
Ms. Slagle  addressed reference  number 30632. She  discussed                                                                   
Facilities  Deferred Maintenance  and  Critical Repairs.  The                                                                   
request  is $2,550,000  for  deferred maintenance  items  for                                                                   
approximately 700  buildings maintained by the  Department of                                                                   
Transportation  (DOT). The  needs  vary from  roof to  boiler                                                                   
replacements  and  other mechanical  code  compliance  issues                                                                   
that  arise. Operating  preventative  maintenance funds  lack                                                                   
eligibility to fund these repairs on an ongoing basis.                                                                          
9:45:58 AM                                                                                                                    
Co-Chair  Stedman requested  specific  amounts regarding  the                                                                   
funding requests.  With a $10  million forecast, he  asked if                                                                   
the  request was  a  response to  declining  revenue or  were                                                                   
maintenance needs increasing.                                                                                                   
Mr.   Richards  explained   the   projection  for   increased                                                                   
maintenance on aviation and highway  facilities. He explained                                                                   
that the  projection is  a response to  the development  of a                                                                   
ten year fiscal  plan identifying future program  needs. This                                                                   
year, with  the economic downturn,  the request was  based on                                                                   
the price of oil.                                                                                                               
Co-Chair Stedman asked for a list  of remaining projects from                                                                   
last  year's appropriation.  Ms. Slagle  responded that  last                                                                   
year's funds are allocated to  deferred maintenance projects.                                                                   
She offered  to provide the  committee with an  accounting of                                                                   
expenses.  Mr.  Richards  clarified   the  goal  of  bringing                                                                   
projects under contract quickly.                                                                                                
9:48:32 AM                                                                                                                    
Reference Number 47564                                                                                                        
Ms.  Slagle continued  with reference  number  47564 and  the                                                                   
Fairbanks Geist Road Rehabilitation  equaling $5 million. She                                                                   
explained that  the funds allow resurfacing and  repaving the                                                                   
road.  She   explained  that   traffic  control,   pedestrian                                                                   
improvements, and signage updates are included in the plan.                                                                     
Co-Chair  Stedman asked  about concern  with resurfacing  and                                                                   
the increased  cost of oil  leading to expensive  asphalt and                                                                   
tar. He asked  about the asphalt price assumption  and the $5                                                                   
million  figure.  Mr.  Richards  agreed  that  the  price  of                                                                   
asphalt  has  risen  considerably.   He  offered  to  provide                                                                   
information to the committee regarding  the price of oil used                                                                   
to determine the $5 million figure.                                                                                             
Co-Chair  Stedman  asked if  the  department  has arrived  at                                                                   
agreement with the industry in  the form of a reset mechanism                                                                   
for the issue of the cost of asphalt.  Mr. Richards confirmed                                                                   
that contractors take the first  7 percent of cost escalation                                                                   
risk. The  responsibility rests with  the state in  the event                                                                   
of an oil price increase greater than 7 percent.                                                                                
Co-Chair   Stedman  discussed   the   potential  choices   of                                                                   
contractors. Mr.  Richards stated  that the quotes  were high                                                                   
due to increased oil costs.                                                                                                     
9:52:39 AM                                                                                                                    
Co-Chair Stedman  informed that this mechanism  was common in                                                                   
other  states  allowing  control   of  margins  and  ensuring                                                                   
predictability  of  risk.  Mr.  Richards  reported  that  the                                                                   
department  followed   an  example   set  by  other   states.                                                                   
Contracts without  the provision result in the  greatest cost                                                                   
Reference Number 48214 and 48213                                                                                              
Ms. Slagle introduced appropriation  numbers 48214 and 48213,                                                                   
which were  deleted from  the list and  added to  the Federal                                                                   
Surface  Transportation  portion of  the  bill. The  projects                                                                   
include  Nelson  Road  resurfacing and  Phillips  Field  Road                                                                   
Rehabilitation. Co-Chair  Stedman asked if the  projects were                                                                   
part of  the stimulus contingency.  Ms. Slagle  answered that                                                                   
the projects are listed in the regular STIP program.                                                                            
Reference Number 7090                                                                                                         
Ms. Slagle  explained reference  number 7090 requesting  $680                                                                   
thousand  for  Harbor  Deferred   Maintenance.  The  projects                                                                   
include  25  state harbor  facilities.  Deferred  maintenance                                                                   
needs  of approximately  $28 million  exist  with a  priority                                                                   
listing provided to committee members.                                                                                          
Co-Chair Stedman  requested a list of the  maintenance issues                                                                   
particularly Baranof Warm Springs,  as an ongoing maintenance                                                                   
transfer issue for several years.                                                                                               
9:55:09 AM                                                                                                                    
Ms. Slagle  promised a list  of requested maintenance  issues                                                                   
for  the   committee.  Co-Chair   Stedman  simply   requested                                                                   
information regarding  the Baranof Warm Springs  project. Mr.                                                                   
Richards  reported  that  the   City  and  Borough  of  Sitka                                                                   
disputes  the  definition  of   replacement  and  maintenance                                                                   
improvements regarding Baranof Warm Springs.                                                                                    
Co-Chair Stedman  noted that a  difference of  opinion exists                                                                   
regarding  the  interpretation  of  the  term  footprint.  He                                                                   
informed that the project was  vetoed from the capital budget                                                                   
last year  and each  year a project  is delayed,  the expense                                                                   
increases. He believed that the  differences of opinion could                                                                   
be rectified  without difficulty. Mr. Richards  reported that                                                                   
he met personally  with the mayor and city  assembly in Sitka                                                                   
regarding the issue. He also hoped  for a funding resolution.                                                                   
Co-Chair   Stedman  cautioned   that   harbor  projects   are                                                                   
typically  relegated  to  the users.  He  encouraged  careful                                                                   
maintenance and rebuilding of the docks.                                                                                        
9:58:39 AM                                                                                                                    
Mr. Richards replied  that the funding request  exemplifies a                                                                   
cost increase creating concern  leading to future requests of                                                                   
the  legislature. Co-Chair  Stedman informed  that after  the                                                                   
original  veto  of  the Baranof  Warm  Springs  project,  the                                                                   
legislature  appropriated an  additional sum  to rectify  the                                                                   
situation.  Mr.  Richards  noted the  challenge  with  remote                                                                   
facilities includes funding for  an employee to receive a fee                                                                   
in the remote  facilities, with a service cost  less than the                                                                   
potential fees received by the state.                                                                                           
Co-Chair Stedman  suggested equal  treatment accomplished  by                                                                   
providing  a  free  dock  for  residents,  and  other  marine                                                                   
facilities  with  a fee.  He  advised  providing  information                                                                   
about the exceptional  cost of one steel piling  used in dock                                                                   
construction, when a citizen disagrees with fee collection.                                                                     
Mr.  Richards  lacked  information   regarding  the  cost  of                                                                   
pilings,  but he  offered  to provide  it  to the  committee.                                                                   
Individuals submit  fees in municipalities  for justification                                                                   
of the  cost. Co-Chair Stedman  estimated the expense  of one                                                                   
piling in thousands of dollars.                                                                                                 
10:02:48 AM                                                                                                                   
Mr. Richards stated  that he utilized the harbor  himself, as                                                                   
it  provides  access  to the  marine  environment  with  good                                                                   
floats and dock.                                                                                                                
Ms.  Slagle stated  that  there is  no  request for  deferred                                                                   
maintenance  transfers in  harbor  communities. She  admitted                                                                   
that  the  department  attempted  to divest  of  some  harbor                                                                   
facilities.  A transfer  will  not be  presented without  the                                                                   
community's  acceptance  of  responsibility  for  the  harbor                                                                   
including agreement on the deferred maintenance dollars.                                                                        
Co-Chair Hoffman  asked if this category included  docks. Mr.                                                                   
Richards  asked  if Co-Chair  Hoffman  was referring  to  the                                                                   
harbor  deferred maintenance.  Co-Chair  Hoffman wondered  if                                                                   
the department  had further  thoughts  about the transfer  of                                                                   
the Bethel dock facility. He understood  that the facility in                                                                   
Bethel  was a  regional dock  facility. He  believed that  it                                                                   
should  be  a  state's  responsibility   as  the  surrounding                                                                   
villages also benefit from the facility.                                                                                        
10:05:04 AM                                                                                                                   
Mr.   Richards   answered   that   the   department   is   in                                                                   
communication  with Bethel  on  the issue.  Co-Chair  Hoffman                                                                   
understood  that  the mayor  of  Bethel was  in  disagreement                                                                   
about the citizens of Bethel bearing  the cost of maintaining                                                                   
the facility.                                                                                                                   
Co-Chair  Stedman  asked  about the  harbor  construction  50                                                                   
percent match fund expanding and  constructing harbors across                                                                   
the state. He  asked the department's view  on capitalization                                                                   
of the fund.                                                                                                                    
Mr. Richards answered that certain  projects did not make the                                                                   
list  following the  review of  the capital  budget with  the                                                                   
Governor's  office.   The  ongoing  harbor   program  remains                                                                   
successful  with communities,  but the  funding cycle  limits                                                                   
the funds.                                                                                                                      
10:07:13 AM                                                                                                                   
Reference Number 47530                                                                                                        
Ms.  Slagle  reviewed  reference   number  47530  and  Harbor                                                                   
Program  Development for  $350 thousand  from general  funds.                                                                   
The  funding allows  continuation  of coordination  with  the                                                                   
Corp of  Engineers and  local governments regarding  specific                                                                   
projects  including harbor  related work.  The fund  provides                                                                   
assistance  and  oversees  the  harbor  programs  while  also                                                                   
providing funding for the update of some tideland surveys.                                                                      
Reference Number 30631                                                                                                        
Ms.  Slagle   continued  with  reference  number   30631  and                                                                   
Deferred  Maintenance for  Highways for  $2,750,000 from  the                                                                   
general  fund.  She  informed  of a  substantial  backlog  of                                                                   
deferred maintenance  projects. The funds are  typically used                                                                   
for brush cutting, road surface  repairs, erosion protection,                                                                   
and drainage. The projects are  addressed on an annual basis.                                                                   
Co-Chair  Stedman addressed  the ongoing  maintenance of  the                                                                   
DOT  facilities. He  asked about  the  original reduction  of                                                                   
$500,000.  Each  senator  is  given  information  from  their                                                                   
region, but his  concern was about the general  response from                                                                   
citizens requesting  a higher  level of maintenance  of roads                                                                   
in particular.  He requested  a list  of deleted projects  as                                                                   
policy  discussion may  be necessary.  Mr. Richards  answered                                                                   
that activities  such  as brush cutting,  guard rail  repair,                                                                   
asphalt surface  maintenance, and lighting  remain priorities                                                                   
for DOT.                                                                                                                        
10:11:14 AM                                                                                                                   
Co-Chair  Stedman requested  information  about road  service                                                                   
repair  projects  addressed  for  Anchorage  and  Matsu.  Mr.                                                                   
Richards responded  that roads are deteriorating  and must be                                                                   
replaced.  The reduction  addresses crack  sealing for  minor                                                                   
surface areas. The work is then  accomplished for less money.                                                                   
Co-Chair Stedman  communicated  a common constituent  concern                                                                   
that too little maintenance money  is allocated. He preferred                                                                   
to avoid a backlog of deferred maintenance projects.                                                                            
10:14:33 AM                                                                                                                   
Mr.    Richards   welcomed    the   conversation    regarding                                                                   
maintenance.   The  department   faces   challenges  in   the                                                                   
administration  of  the  existing  general  fund  budget  for                                                                   
operations.  He offered  to provide  evidence of  maintenance                                                                   
logs, a  list of the additional  facilities, and  evidence of                                                                   
the lost buying power resulting from inflation.                                                                                 
Reference Number 45198                                                                                                        
Ms.  Slagle  addressed  reference number  45198  for  Highway                                                                   
Maintenance  Vehicle Replacement  and  Safety Equipment.  The                                                                   
request is $900 thousand in general  funds. She informed that                                                                   
the funds assist  in purchasing highway equipment  to replace                                                                   
older equipment.                                                                                                                
Mr.  Richards  informed  about  the high  cost  of  replacing                                                                   
engine parts and vehicles. Equipment  costs are expensive and                                                                   
impact our budget.                                                                                                              
Co-Chair Stedman  asked when the decision is  made to replace                                                                   
rather  than  repair  a  piece  of  equipment.  Mr.  Richards                                                                   
believed that many pieces of equipment  are used for multiple                                                                   
tasks.  Ms. Slagle  noted that  the  department must  observe                                                                   
reports  generated by  the  equipment management  system  for                                                                   
information  on   the  level  of  maintenance   provided  for                                                                   
different pieces  of equipment in order to  make the decision                                                                   
about replacement or repair.                                                                                                    
10:18:05 AM                                                                                                                   
Reference Number 46338                                                                                                        
Ms.  Slagle   introduced  reference  number  46338   and  the                                                                   
Infrastructure and  Erosion Control Design  and Environmental                                                                   
Permitting.  The amount of  the request  is $100 thousand  of                                                                   
general funds.  She stated that these funds  supplement other                                                                   
funds for site  surveys, material source  investigations, and                                                                   
geotechnical and hydrological studies.                                                                                          
Co-Chair Hoffman  how the community  of Noatak  benefits from                                                                   
the funding.  Mr. Richards answered  that there  is currently                                                                   
funding  available  for  Noatak   due  to  support  from  the                                                                   
military. He explained the plan  barge will enter the village                                                                   
initially. The  next step  is an access  road leading  to the                                                                   
evacuation center  and ultimately  to an airport.  Ms. Slagle                                                                   
cited Noatak  addressed further  down the list,  specifically                                                                   
for materials needed for the relocation site.                                                                                   
10:19:58 AM                                                                                                                   
Reference Number 47822                                                                                                        
Ms.   Slagle   continued   with   reference   number   47822,                                                                   
Measurement  Standards  and  Commercial  Vehicle  Enforcement                                                                   
Equipment  Replacement  equaling  $400,000  for  the  Koyukuk                                                                   
village. The goal is an evacuation  road for the community in                                                                   
the  event   of  flooding.  The   funding  is   intended  for                                                                   
reconnaissance study, preliminary  engineering and design for                                                                   
the evacuation road.                                                                                                            
Reference Number 47823                                                                                                        
Ms.  Slagle reviewed  reference number  47823, Materials  for                                                                   
Relocation Site  for $123 thousand  of general  fund dollars.                                                                   
The request  addresses measurement  standards and  commercial                                                                   
vehicle  enforcement equipment  replacement  specific to  the                                                                   
measurement  standard's portion  of  the division  protecting                                                                   
the consumer.                                                                                                                   
Reference Number 47823                                                                                                        
Ms. Slagle  addressed reference  number 47823 for  $2 million                                                                   
in general funds  providing earthwork required  for the barge                                                                   
staging area and  evacuation staging road for  the village of                                                                   
Noatak.  Mr.  Richards  added  that the  material  source  is                                                                   
identified and will open for the needed projects.                                                                               
10:22:18 AM                                                                                                                   
Reference Number 45669                                                                                                        
Ms. Slagle described  reference number 45669,  which requests                                                                   
$500,000  for Ports  and  Harbors Long  Range  Transportation                                                                   
Plan. The  department  received $250,000  last year to  begin                                                                   
the  planning process  with the  Corps of  Engineers and  the                                                                   
Denali Commission.  The appropriation  is necessary  to match                                                                   
the funds provided by the Corps of Engineers.                                                                                   
Reference Number 48320                                                                                                        
Ms. Slagle  detailed reference  number 48320 for  the village                                                                   
of Quinhagak: Old Airport Site  Remediation for $500,000. The                                                                   
funds provide remediation  work at the old airport  site. The                                                                   
land is currently  leased from the Native Corporation  with a                                                                   
strong  interest in  addressing soils  impacted by  petroleum                                                                   
and other airport byproducts.                                                                                                   
Reference Number 47599                                                                                                        
Ms. Slagle  reviewed reference  number 47599, Rapid  Reaction                                                                   
to Highway  Safety Features  for $200,000,  which allows  the                                                                   
department  to address  emergency or safety  issues on  state                                                                   
10:25:00 AM                                                                                                                   
Co-Chair Hoffman  asked if the program was  new and expanded.                                                                   
Ms. Slagle concurred that the item was new.                                                                                     
Reference Number 39356                                                                                                        
Ms. Slagle addressed reference  number 39356 and the Resource                                                                   
Development  Roads for  $2.6 million  of  general funds.  She                                                                   
noted  that these  funds were  received in  the past and  the                                                                   
department  used   them  to   access  resource   or  economic                                                                   
development  opportunities.    Co-Chair Hoffman  asked  which                                                                   
roads  are targeted  with these  funds.  Ms. Slagle  answered                                                                   
that an  award type of process  for the considered  roads was                                                                   
developed, but there is not a list of preferred roads.                                                                          
Mr.  Richards  stated  that  scoring   criteria  is  used  to                                                                   
identify the appropriate roads.                                                                                                 
Senator Thomas  asked if the Department of  Natural Resources                                                                   
(DNR) worked in conjunction with DOT on this issue.                                                                             
Mr. Richards answered that DNR  is a major recipient of these                                                                   
funds.  He  explained  that  DNR  reviews  the  criteria  and                                                                   
nominates projects to benefit land development.                                                                                 
10:28:10 AM                                                                                                                   
Senator  Ellis  asked  why this  project  is  not  considered                                                                   
corporate   welfare.  He   inquired   whether  the   business                                                                   
enterprises have  any obligation  to contribute a  portion of                                                                   
the project  cost. He  mentioned the  nomination of  projects                                                                   
for  funding  and  he  asked   whose  opinion  mattered  most                                                                   
regarding the  final choice. Mr.  Richards answered  that the                                                                   
program is similar  to the harbor and current  STIP programs,                                                                   
where nominations are received  from the public including the                                                                   
private sector.  The resource development funds  are used for                                                                   
employment regarding resource extraction.                                                                                       
Senator Ellis  stated that  he would be  less opposed  if the                                                                   
mining  industry paid  a  portion of  the  obligation to  the                                                                   
state  treasury. He  expressed opposition  to spending  money                                                                   
that the  private sector neglects  to contribute back  to the                                                                   
general fund.                                                                                                                   
Mr.   Richards   expressed  that   the   funds   appropriated                                                                   
previously  benefitted  forestry,  mines,  oil, and  gas.  He                                                                   
informed  that the  available  funding is  $3 million,  which                                                                   
will not go far in creating a  new road. Senator Ellis opined                                                                   
that  some  industries pay  their  fair  share to  the  state                                                                   
treasury, where others do not come close.                                                                                       
10:32:01 AM                                                                                                                   
Senator Thomas asked  for a list of the  considered projects.                                                                   
Mr. Richards offered to provide  a list to the committee. Co-                                                                   
Chair Stedman stated  that he would look through  the already                                                                   
presented data.                                                                                                                 
Reference Number 47582                                                                                                        
Ms.  Slagle   described  reference  number  47582   for  $100                                                                   
thousand  in  general  funds   requested  for  Southeast  Ice                                                                   
Control  Chemicals Storage  Tank  Replacements in  Petersburg                                                                   
and  Klawock.  She explained  that  the funds  would  provide                                                                   
steel storage tanks  to house the ice control  chemicals. The                                                                   
current tanks leak.                                                                                                             
Reference Number 30628                                                                                                        
Ms. Slagle  reviewed reference  number 30628 for  $15 million                                                                   
for  state equipment  fleet  replacement.  The funds  replace                                                                   
heavy equipment,  trooper vehicles,  or state agency  vans or                                                                   
Reference Number 47572                                                                                                        
Ms. Slagle addressed  reference number 47572: a  piece of the                                                                   
original request since deleted and zeroed.                                                                                      
Co-Chair  Stedman expressed  concern that  the obligation  to                                                                   
maintain sidewalks remained.                                                                                                    
Mr. Richards  stated that  the responsibilities  held  by the                                                                   
state allow  the performance  of road  maintenance. The  hope                                                                   
was to  employ the funding for  this project but  without it,                                                                   
the department will fall back on their existing equipment.                                                                      
Co-Chair  Stedman stated  that the question  was directed  at                                                                   
all  communities.  Many communities  receive  federal  funded                                                                   
sidewalks  and bike  lanes.  He  did not  wish  to ignore  an                                                                   
10:36:18 AM                                                                                                                   
Mr.  Richards  answered  that  the  existing  facilities  are                                                                   
maintained as  a priority. The information  and communication                                                                   
is  provided  at  the behest  of  the  legislature.  Sidewalk                                                                   
maintenance is provided in Anchorage.  Juneau also received a                                                                   
facility  for  snow  removal.  Co-Chair Stedman  asked  if  a                                                                   
machine request is expected annually for each community.                                                                        
Mr. Richards answered that bike  paths are usually continuous                                                                   
with the  road service, trucks  often plow them. If  they are                                                                   
separated,  then   a  specialized   piece  of  equipment   is                                                                   
required. The challenge with adding  specialized equipment to                                                                   
the fleet is the challenge of maintenance funding.                                                                              
10:39:17 AM                                                                                                                   
Reference Number 30628                                                                                                        
Ms.  Slagle reviewed  reference  number 30628  and the  State                                                                   
Equipment Fleet Replacement for  $15 million from the Highway                                                                   
Working Capital Funds. The funds  replace all vehicles in the                                                                   
system based on the revenues received  from user agencies and                                                                   
based on a schedule of vehicle replacement.                                                                                     
Reference Number 41394                                                                                                        
Ms.  Slagle discussed  reference number  41394 and  statewide                                                                   
anti-icing program  for $200 thousand from the  general fund.                                                                   
This reduces  cost by  15 percent  due to  the use of  sodium                                                                   
chloride brine.  The funding provides storage  tanks, piping,                                                                   
and the additional applicator  equipment required to dispense                                                                   
these liquids.                                                                                                                  
Co-Chair  Stedman   asked  if  the  solution   will  dissolve                                                                   
citizen's cars.  Mr. Richards responded that  sodium chloride                                                                   
is used  across the nation to  remove snow and  ice. Co-Chair                                                                   
Stedman  noted   that  citizens   should  not  have   adverse                                                                   
automotive effects. Mr. Richards  stated that sodium chloride                                                                   
generates rust.                                                                                                                 
Senator   Olson   noted   that   there   might   be   further                                                                   
deterioration  on   the  asphalt  surface  with   the  sodium                                                                   
chloride. Mr. Richards answered  that there is not an adverse                                                                   
effect on the  asphalt surface, but bridges  are affected and                                                                   
so another de-icing  is used for them. Also,  sodium chloride                                                                   
works well above 22 degrees Fahrenheit,  but another agent is                                                                   
used for colder  temperatures. Senator Olson  asked about the                                                                   
steel  structure  of the  bridges  and  the response  to  the                                                                   
sodium chloride. Mr. Richard agreed  that the department does                                                                   
not wish to generate problems  with the bridges and thus will                                                                   
refrain from using sodium chloride for deicing on bridges.                                                                      
10:43:23 AM                                                                                                                   
Co-Chair Stedman asked about the  potential cost to the state                                                                   
if  a solution  that does  not  dissolve metal  is used.  Mr.                                                                   
Richards  replied  that  potassium  acetate is  used  in  the                                                                   
airports  because   it  is  less  corrosive,   but  the  cost                                                                   
difference is significant.                                                                                                      
Reference Number 45202                                                                                                        
Ms.  Slagle addressed  reference number  45202 and  Statewide                                                                   
Emergency Bridge Repair for $1  million. These bridge repairs                                                                   
are more frequently observed in  areas of high water or wind.                                                                   
Reference Number 42072                                                                                                        
Ms. Slagle detailed  reference number 42072 for  2,500,000 in                                                                   
general   funds   for   Statewide    Rural   Airport   Safety                                                                   
Improvements.  The  fund  addresses safety  issues  at  rural                                                                   
airports that cannot wait for a federal project.                                                                                
10:46:01 AM                                                                                                                   
Senator  Olson asked  about  long-term  plans for  developing                                                                   
airports in Naknek. He asked if  the airport might eventually                                                                   
be plowed over.  Mr. Richards stressed the need  for airports                                                                   
to enable  the children to  get reach  school. The goal  is a                                                                   
link  for  river  crossing.  He  mentioned  many  discussions                                                                   
between  the department  and the  Bristol  Bay Borough  about                                                                   
taking ownership  of Naknek, but the real  estate transaction                                                                   
is complicated.                                                                                                                 
Reference Number 33853                                                                                                        
Ms. Slagle  described reference  number 33853 and  $1 million                                                                   
in  general  funds  for surfacing  materials  used  on  major                                                                   
highway projects.                                                                                                               
10:49:05 AM                                                                                                                   
Reference Number 47532                                                                                                        
Ms.  Slagle  introduced  reference   number  47532  for  $348                                                                   
thousand  in general  funds  for the  update  of Storm  Water                                                                   
Pollution Prevention Plans and Spill Prevention Control.                                                                        
Reference Number 48357                                                                                                        
Ms. Slagle  described reference  number 48357 for  $3 million                                                                   
in   general   funds   for   the    Western   Alaska   access                                                                   
reconnaissance  study.  The  study   details  analysis  on  a                                                                   
corridor  to the  Seward Peninsula.  The  funding allows  the                                                                   
department to search for alternative routes.                                                                                    
Co-Chair Stedman suggested, during  challenges to the revenue                                                                   
stream,  the   state  funds   maintenance  while   postponing                                                                   
corridor  studies. Mr.  Richards stated  that the  Governor's                                                                   
goal  is to  advance the  project as  it is  crucial to  move                                                                   
westward.  The next  phase  is  a multi  year  effort of  the                                                                   
reconnaissance  study.  Co-Chair  Stedman supposed  that  the                                                                   
committee might have a different  opinion about the source of                                                                   
the funds.                                                                                                                      
10:52:40 AM                                                                                                                   
Senator Olson  asked about neglect of airport  maintenance in                                                                   
the community  of Kwigillingok.  Mr. Richards agreed  that he                                                                   
would address the comment later.                                                                                                
Co-Chair Stedman  asked about  the STIP  and the $3  million.                                                                   
Mr. Richards  answered that the  STIP is a planning  document                                                                   
required of the  department for use of federal  highway funds                                                                   
under   title   23.   He   explained   that   STIP   requires                                                                   
identification of  the project and work  activities utilizing                                                                   
federal  funds for those  projects. The  STIP identified  the                                                                   
federal program and how the money is spent.                                                                                     
Co-Chair Stedman  asked if the committee might  expect to see                                                                   
the request again in the future.  Mr. Richards announced that                                                                   
the  STIP process  requires fiscal  constraint.  In order  to                                                                   
move forward  with the  project the source  of funds  must be                                                                   
shown. Currently the department  is performing reconnaissance                                                                   
with  general fund.  Co-Chair  Stedman clarified  that he  is                                                                   
speaking about another time in the future.                                                                                      
10:55:03 AM                                                                                                                   
Co-Chair  Hoffman  understood  that an  explanation  for  the                                                                   
project is the  potential economic benefit to  the community.                                                                   
He wondered  if the  administration has  plans to access  the                                                                   
Donlan Creek region and Pebble  Mine region that clearly have                                                                   
shown  great economic  benefit. Mr.  Richards responded  that                                                                   
the current planning  level effort for western  Alaska access                                                                   
looks  for  resources  from  the  Kuskoquim  River  northward                                                                   
towards the Embler district and Westward toward Nome.                                                                           
SB  75   was  HEARD  and   HELD  in  Committee   for  further                                                                   
10:57:26 AM                                                                                                                   
The meeting was adjourned at 1:37 AM.                                                                                           

Document Name Date/Time Subjects
Airport Deferred Maint. List Ref#30633.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
AMHS FACILITY Deferred Maint. List Ref.#42001.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
AMHS VESSEL Deferred Maint. Ref#42001.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
Facility Deferred Maint. List Ref.#30632.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
Harbors Deferred Maint. List Ref.#7090.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
Highway Deferred Maint. List Ref.#30631.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
Bridge 2009 report - Stwd Design.pdf SFIN 3/16/2009 9:00:00 AM
SB 75
FHWA Snow Removal on Sidewalks Memo 082708.pdf SFIN 3/16/2009 9:00:00 AM
SB 75