Legislature(2023 - 2024)SENATE FINANCE 532
02/27/2024 09:00 AM Senate FINANCE
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| Audio | Topic |
|---|---|
| Start | |
| SB105 | |
| SB125 | |
| SB205 | |
| Adjourn |
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
| + | SB 105 | TELECONFERENCED | |
| *+ | SB 205 | TELECONFERENCED | |
| + | TELECONFERENCED | ||
| += | SB 125 | TELECONFERENCED | |
SENATE FINANCE COMMITTEE
February 27, 2024
9:08 a.m.
9:08:48 AM
CALL TO ORDER
Co-Chair Olson called the Senate Finance Committee meeting
to order at 9:08 a.m.
MEMBERS PRESENT
Senator Lyman Hoffman, Co-Chair
Senator Donny Olson, Co-Chair
Senator Bert Stedman, Co-Chair
Senator Click Bishop
Senator Jesse Kiehl
Senator Kelly Merrick
Senator David Wilson
MEMBERS ABSENT
None
ALSO PRESENT
Emma Torkelson, Staff, Senator James Kaufman; Bill O'Leary,
President and CEO, Alaska Railroad Corporation; Preston
Carnahan, Regional Vice President of Development, Royal
Caribbean; Ken Alper, Staff, Senate Finance Committee;
Stacy Barnes, Director of Government Relations and Public
Affairs, Alaska Housing Finance Corporation; Senator Cathy
Giessel.
PRESENT VIA TELECONFERENCE
Akis Gialopsos, Deputy Executive Director, Alaska Housing
Finance Corporation, Brian Lindamood, Chief Engineer,
Alaska Railroad Corporation, Anchorage; Kat Sorenson, City
Manager, City of Seward; Bryan Butcher, CEO and Executive
Director, Alaska Housing Finance Corporation, Anchorage.
SUMMARY
SB 105 RAILROAD CORP. FINANCING
SB 105 was HEARD and HELD in committee for
further consideration.
SB 125 AK HOUSING FINANCE CORP: SUSTAIN ENERGY
SB 125 was HEARD and HELD in committee for
further consideration.
SB 205 AHFC AUTHORITY TO ACQUIRE BUILDING
SB 205 was HEARD and HELD in committee for
further consideration.
SENATE BILL NO. 105
"An Act authorizing the Alaska Railroad Corporation to
issue revenue bonds to finance the replacement of the
Alaska Railroad Corporation's passenger dock and
related terminal facility in Seward, Alaska; and
providing for an effective date."
9:10:02 AM
EMMA TORKELSON, STAFF, SENATOR JAMES KAUFMAN, introduced
the legislation. She read from the Sponsor Statement (copy
on file):
The Alaska Railroad Corporation (ARRC) owns and
operates a passenger dock and an associated intermodal
terminal facility in Seward, Alaska. These facilities
serve cruise ships; other passenger and freight
vessels; and provide cruise ship passengers who help
support Southcentral Alaska's economy.
These facilities were both built in 1966 and have
experienced significant corrosion over their half
century lifespan. Recently, the deterioration of the
dock has forced dock managers to implement weight
restrictions. While currently safe for restricted
service, the dock is clearly nearing the end of its
useful life. Continuing to curtail use or completely
closing the dock would severely impact not just the
vessels that rely on the dock, but also the robust
tourism industry in Seward. ARRC would lose a key
revenue source, important for meeting their public
corporation obligations and supporting necessary
capital improvements across the state. More broadly,
losing the Seward dock would diminish a key gateway
that would take a heavy toll on Southcentral Alaska's
travel industry and broader transportation
infrastructure across the state.
The Legislature and the Governor recognized the
importance of this issue in 2022 when both parties
authorized ARRC to issue up to $60 million in bonds to
replace its aging Seward passenger dock and terminal.
After working closely with their long-term dock
tenant, Royal Caribbean Group (RCG), ARRC is now
requesting an additional $75 million in bond
authorization to support an expanded version of this
vital project that aligns with RCG growing needs.
Senate Bill 105 authorizes ARRC to issue revenue bonds
up to $135 million total for the Seward Dock
replacement project. The project will be fully funded
by ARRC through a multi-year berthing agreement with
the RCG with an annual revenue guarantee. Per the
railroad's statutes, the bonds are not a liability of
the state, and no state dollars will be used to repay
them. To support RCG's commitment and associated
economic growth, the project construction schedule is
time sensitive.
The passage of SB 105 this session allows ARRC to
proceed on schedule with the critically needed Seward
dock/terminal replacement and expansion project. Join
me in supporting this opportunity to secure Seward's
critical port infrastructure and boost the tourism
industry in Seward and around the state of Alaska.
9:12:27 AM
Co-Chair Olson wondered what had happened with the $60
million in revenue bonds that had already been issued.
9:12:34 AM
Ms. Torkelson replied that no funds had been bonded. An
additional amount was being waited on for the expansion of
the larger project.
9:12:44 AM
Co-Chair Olson said in addition to the $75 million.
9:12:46 AM
Ms. Torkelson responded in the affirmative; the total would
be $135 million.
Co-Chair Olson aske whether that total would be enough to
complete the dock.
Ms. Torkelson replied that the railroad had indicated that
it would be enough.
9:12:57 AM
Co-Chair Olson asked when the project would be complete.
9:13:03 AM
Ms. Torkelson replied that the project completion was
expected in 2026.
9:13:16 AM
Ms. Torkelson discussed the Sectional Analysis (copy on
file):
Section 1. Authorizes the Alaska Railroad Corporation
to issue additional $75 million (not exceeding a total
$135 million) in revenue bonds to finance the
replacement of ARRC's passenger dock and related
terminal facility in Seward, Alaska.
Section 2. Sets an immediate effective date.
9:14:17 AM
BILL O'LEARY, PRESIDENT AND CEO, ALASKA RAILROAD
CORPORATION, discussed the presentation, "Seward Passenger
Dock and Terminal Replacement Project" (copy on file). He
looked at slide 2, "Need For Replacement":
• Current Seward dock facility is rapidly approaching
end of useful life
• Seward cruise port is critical infrastructure for
Alaska's travel industry: 188,124 passengers cruised
to or from Seward in 2023, many adding on travels in
Southcentral and Interior
9:19:38 AM
Mr. O'Leary looked at slide 3, "Funding and Timeline":
2022: $60 million in bond authorization approved
2024: Requesting additional $75 million bond
authorization
Fall 2025: Construction begins
Spring 2026: New dock and terminal complete
Bonds issued by ARRC are not a liability of the state,
and no state dollars will be used for repayment; ARRC
bonds will be secured by a long-term use agreement
with anchor tenant Royal Caribbean Group.
The new dock and terminal facility will support the
next 50 years of industry growth and visitor demand.
9:20:10 AM
Co-Chair Stedman requested the cost escalators of the
project.
9:20:25 AM
Mr. O'Leary replied that there had been significant
escalation in costs over the past few years. He noted
changing of scope to meet anchor tenant needs. He said that
the dock could be used by other cruise lines and the point
was to be able to bring in larger ships not currently
supported by the dock.
9:21:43 AM
Senator Bishop understood that the dock would be a dual-
purpose dock.
9:22:07 AM
Mr. O'Leary replied that it would be a floating dock
designed for the cruise industry and could be available for
light freight.
9:23:16 AM
Senator Wilson asked why the dock was a floating dock
rather than a fixed dock.
9:23:30 AM
Mr. O'Leary replied that that was what the customer wanted.
9:23:46 AM
Senator Wilson asked whether there might be other customers
who would want something different.
9:23:57 AM
Mr. O'Leary replied that other cruise lines had shown
interest, but Royal Caribbean Group had been the only one
to sign a long-term agreement.
9:24:32 AM
Co-Chair Stedman mentioned long-term agreements and
preferential moorage.
9:24:37 AM
Mr. O'Leary replied that the anchor tenant would have
benefits but that the railroad perceived that the dock
would be an open dock available for other users.
9:24:58 AM
Co-Chair Stedman expressed dissatisfaction with the reply.
He queried electrification of the dock.
9:25:21 AM
Mr. O'Leary responded deferred to Mr. Carnahan.
9:25:36 AM
PRESTON CARNAHAN, REGIONAL VICE PRESIDENT OF DEVELOPMENT,
ROYAL CARIBBEAN, introduced himself, and asked Co-Chair
Stedman to restate his question.
9:25:50 AM
Co-Chair Stedman asked about electrification of the ports
so that ships could turn off generators while in port.
9:26:32 AM
Mr. Carnahan replied that the budget provided for
electrification of the dock to provide power to ships. He
said that the utilities would work to make power available.
Co-Chair Olson queried the technical details.
9:27:15 AM
Mr. Carnahan replied that he had a technical team that had
the details.
9:27:33 AM
Co-Chair Stedman understood the idea of preferential
moorage for an anchor tenant and thought that the cruise
industry and the railroad should be transparent about that
common benefit. He asked whether the electrification would
be put in during the installation of the dock and whether
it was included in the current bond authorization request.
He asked how many ships the dock could accommodate and
whether the ships could plug in on either port or starboard
sides.
9:28:41 AM
Mr. O'Leary deferred to Mr. Carnahan.
9:28:51 AM
Mr. Carnahan replied that the dual sided pier would
accommodate two larger ships simultaneously. The current
budget included the dock electrification.
9:29:19 AM
Co-Chair Stedman asked about plugging in on port and
starboard sides of the ships; some older ships only plugged
in on one side. He asked about the megawattage capacity
once ships were plugged in.
9:30:45 AM
Co-Chair Hoffman wondered whether the project was fully
designed before the 2022 $60 million bond authorization.
9:31:15 AM
Mr. O'Leary responded that the project had been designed
but modifications could still be made. He asserted that the
process of building could begin under the current design.
9:32:01 AM
Co-Chair Hoffman noted that the Port of Alaska had had some
challenges. He wondered whether a breakdown of how the $70
million would be spent was available.
9:32:26 AM
Mr. O'Leary responded that there was no construction risk
to the railroad.
9:33:13 AM
Co-Chair Olson asked who would oversee quality control on
the construction.
9:33:19 AM
Mr. O'Leary replied that the railroad would be involved to
assure that the design met the needs of the railroad.
9:33:54 AM
Co-Chair Hoffman understood that the dock would be designed
and built by the state and wondered what involvement the
state had in the construction, considering it would
eventually become a state asset.
9:34:39 AM
Mr. O'Leary agreed that the railroad should be aware of the
operations and maintenance responsibilities that would be
assumed by the railroad. He said that the arrangement with
the anchor tenant would include provisions for funding.
9:35:24 AM
Co-Chair Hoffman asserted that the operation and
maintenance would depend on the design and that those costs
should be as minimal as possible. He expressed reluctance
to give approval for the state to take responsibility for
operation and maintenance without more design information.
9:36:45 AM
Mr. O'Leary said that it was incumbent on the railroad to
know what the costs would be and deferred further
explanation of the design to the projects chief engineer.
9:37:53 AM
Co-Chair Hoffman said that the railroad would not be before
the committee if there was funding authorization to proceed
with the project. He felt that it was the legislature's
fiduciary responsibility to vet the project more
extensively.
9:38:51 AM
Senator Merrick asked whether Seward ever had more than two
cruise ships in dock at a time, and if so, would the dock
have the capability to accept tenders.
9:39:03 AM
Mr. O'Leary replied in the affirmative.
9:39:29 AM
Senator Bishop wondered whether a percentage contingency
fee for overruns had been built into the cost.
9:39:43 AM
Mr. O'Leary responded that the liability was capped for the
railroad.
9:40:04 AM
Senator Bishop asked whether there was a third-party
consultant assigned to consult on the execution on the dock
project.
9:40:30 AM
Mr. O'Leary replied that the railroad was adept at the
building of large projects and that this project would be
no different.
9:40:47 AM
Senator Bishop asked whether there was a sinking fund
component built into the project plans.
9:41:18 AM
Mr. O'Leary replied in the negative. He suggested that dock
fees would be used for repairs.
9:41:49 AM
Senator Bishop wondered whether the floating dock method
was a one off or whether there were other examples of the
method being used.
9:42:00 AM
Mr. O'Leary deferred to Mr. Carnahan but explained that a
large percentage of recently built cruise docks had used a
similar design to Seward.
9:42:53 AM
Co-Chair Olson asked whether there was Port of Alaska
support as well.
9:42:56 AM
Mr. O'Leary replied "no."
9:43:04 AM
Co-Chair Olson asked Mr. Carnahan to speak to Co-Chair
Bishops question.
9:43:18 AM
Mr. Carnahan explained that the dock was unique to Alaska.
He stated that the dock in Seward would be a turnaround
port and the design reflected an enhanced design to turn
around passengers and be a port of call.
9:44:06 AM
Co-Chair Stedman queried the scale of the dock as compared
to other docks in Southeast.
9:44:26 AM
Mr. Carnahan responded that the facilities in Hoonah and
Ketchikan were port of call docks, which meant they
required less space, and all access hatches of the vessel
did not need to be accessible. The project at Seward would
have all hatched available and the dock was wider and sat
steeper.
9:45:09 AM
Co-Chair Stedman understood the width was wider but
wondered about length.
9:45:17 AM
Mr. Carnahan said that the dock was long enough to
accommodate access to all hatches.
9:45:39 AM
Co-Chair Stedman asked whether the dock could be used for
aircraft carriers or naval vessels.
9:45:43 AM
Mr. Carnahan responded that he did not know.
9:45:54 AM
Co-Chair Stedman requested that he get back to the
committee with the information. He noted that there was a
military build up in the North Pacific.
9:46:18 AM
Senator Bishop wondered whether the debt could be floated
in the event of another pandemic or if a contingency had
been built in.
9:46:57 AM
Mr. O'Leary responded that the railroad would first look to
the long-term agreement with the anchor tenant. If for an
unforeseen reason the railroad was not paid, he was
confident that the railroad could float the debt service.
9:47:47 AM
Senator Kiehl asked whether that answer would change if the
railroad put in the maximum amount of money under
discussion.
9:48:20 AM
Mr. O'Leary replied in the negative.
9:48:47 AM
Senator Kiehl referred to Co-Chair Stedmans question about
military vessels. He asked about the capacity the railroad
would have for bringing on more capacity across the dock.
9:49:55 AM
Mr. O'Leary replied that the design under consideration
would address the largest cruise ships currently traveling
to the state.
9:50:27 AM
Mr. Carnahan furthered that the dock would accommodate any
ships currently existing and under future contemplation. He
added that the company did not intend to bring those larger
ships to Seward.
9:50:55 AM
Senator Kiehl spoke of the ship to shore connection. He
asked about the docks capacity to handle dramatic
increases in loads.
9:51:33 AM
BRIAN LINDAMOOD, CHIEF ENGINEER, ALASKA RAILROAD
CORPORATION, ANCHORAGE (via teleconference), responded
discussions were underway to analyze and optimize capacity.
He said that the current design was for highway loads. The
float itself was designed to increase capacity later. The
gangway was also being studied for increased capacity. He
noted that the dock was designed for light to medium
duty freight.
9:53:05 AM
Co-Chair Stedman asked about passenger turnaround and how
large cruise ships and large passenger groups would be
handled.
9:53:27 AM
Mr. O'Leary responded that the issue was a concern. The
infrastructure, excluding the dock, would need to be
addressed. He understood that large ships had not been
planned for in the immediate future but that the dock would
have capacity in the future for large ships. He said that
the railroad was looking to expand the passenger fleet to
meet growth in the cruise industry. He relayed that the
first step was to optimize existing assets. He did not
think that passenger coaches would need to be added to
address the growing number of tourists.
9:55:10 AM
Co-Chair Stedman remarked that the railroad would need to
expand to accommodate the increase in visitors. He asked
whether the railroad had contemplated any capital needs
that would be brought before the legislature for funding
or could the railroad absorb expenses internally.
9:55:50 AM
Mr. O'Leary responded that the goal was to fund any
expansion internally and not have to come before the
legislature to ask for funding.
9:56:31 AM
KAT SORENSON, CITY MANAGER, CITY OF SEWARD (via
teleconference), spoke in support of the legislation. She
stated that the bill represented a crucial investment in
the community and the broader economic prosperity of
Alaska. She replied that the spaced was designed for year-
round community use and would be a vibrant hub for
residents. She noted that the project would bring seasonal
and year-round employees to the city. She attested that the
project would add a large rate payer to the locally owned
electric utility, which would ease the overall burden to
smaller rate payers and contribute to overall energy
sustainability in the community. She said that the railroad
had also invested in the freight dock in Seward, expanding
and improving corridors. She urged the committee to support
the legislation.
9:58:39 AM
Co-Chair Stedman queried the utility capacity and the
utility ownership in Seward, and the citys ability to have
two large ships plug into their grid.
9:59:06 AM
Ms. Sorenson replied that currently the utility was owned
by the municipality and power was purchased from Chugach
Electric. She said that infrastructure projects were
underway to meet the demand of the cruise ships upon their
arrival.
9:59:48 AM
Co-Chair Stedman felt that the committee needed more
information. He predicted future funding requests from the
city for financial assistance, as had been the case with
other communities electrifying cruise ships in port.
10:00:19 AM
Mr. O'Leary spoke in support of shore power. He relayed
that the railroad would work with the city and the
developer to make shore power a reality.
10:00:42 AM
Co-Chair Olson asked for the numbers that Co-Chair Stedman
had requested.
Mr. O'Leary agreed to provide the information.
10:01:00 AM
Co-Chair Olson surmised and wondered what would happen with
the fixed dock once the floating dock was completed.
10:01:14 AM
Mr. O'Leary replied that the existing passenger dock would
be demolished but the freight dock would remain and would
be lengthened and widened.
10:01:36 AM
Co-Chair Olson asked whether the cold dock was currently
being used.
10:01:41 AM
Mr. O'Leary replied in the negative.
10:01:55 AM
Senator Merrick asked about the difference between light,
medium, and heavy freight. She wondered whether light
and medium freight would cover food shipments.
10:02:12 AM
Mr. O'Leary responded that the Seward freight dock could be
of use in the event of an emergency at the Port of Alaska.
10:03:08 AM
Mr. Lindamood added that the proposed passenger dock could
take on any of the freight that was currently being handled
at the Port of Alaska.
10:03:40 AM
Co-Chair Stedman asked whether cranes would be installed on
the proposed dock.
10:03:47 AM
Mr. O'Leary responded in the negative.
10:04:00 AM
Co-Chair Stedman remarked that a dock without a crane might
be inefficient. He thought that if the docks at Whittier
and Seward were to be back up dock for the Port of
Anchorage, they should have cranes.
10:04:33 AM
Mr. O'Leary responded that the railroad would be
delighted to discuss possible uses of both their assets
in Whittier and in Seward.
10:05:28 AM
Co-Chair Olson asked Ms. Sorenson to comment on the
discussion.
10:05:36 AM
Ms. Sorenson highlighted that Whittier and Seward were deep
water, ice-free ports year-round. She said that the city
had been working to get shore power infrastructure in place
and would provide numbers to the committee.
10:06:15 AM
Co-Chair Olson OPENED and CLOSED public testimony.
SB 105 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 125
"An Act relating to subsidiary corporations of the
Alaska Housing Finance Corporation; and establishing
the Alaska energy independence fund."
10:07:27 AM
Senator Kiehl MOVED to ADOPT the committee substitute for
SB 125, Work Draft 33-GS1074/S (Walsh, 2/14/24)(copy on
file).
10:07:45 AM
Co-Chair Olson OBJECTED for discussion.
10:07:53 AM
KEN ALPER, STAFF, SENATE FINANCE COMMITTEE, discussed the
Summary of Changes (copy on file):
Change 1 Deleted what was Sec. 4 of the original
version of the bill. This section would have created a
new "energy independence fund" for the purpose of
financing certain projects. The remaining bill enables
AHFC to set up a subsidiary corporation to pursue
federal and other funding, finance projects, and
otherwise implement the goals of the bill. But without
the fund, there will no longer be the request for a
state general fund appropriation to capitalize the
fund.
Change 2 Adds an immediate effective date to create
the new AHFC subsidiary and make the other changes in
the bill. Additional Changes in Second Finance CS,
Version "B" to "S"
Change 3 On page 2, line 23, adds the words "or
delivering energy to the state." This allows AHFC to
support energy projects outside Alaska that will be
delivering energy to users in the state.
10:09:19 AM
Co-Chair Olson WITHDREW his objection. There being no
further objection it was so ordered.
10:09:59 AM
STACY BARNES, DIRECTOR OF GOVERNMENT RELATIONS AND PUBLIC
AFFAIRS, ALASKA HOUSING FINANCE CORPORATION, deferred to
Mr. Gialopsos.
AKIS GIALOPSOS, DEPUTY EXECUTIVE DIRECTOR, ALASKA HOUSING
FINANCE COROPRATION, related that the corporation was
supportive of the changes the committee had made to the
bill.
10:11:06 AM
AT EASE
10:11:55 AM
RECONVENED
SB 125 was HEARD and HELD in committee for further
consideration.
SENATE BILL NO. 205
"An Act authorizing the Alaska Housing Finance
Corporation to acquire or purchase a building that it
occupies for an amount that does not exceed
$9,000,000; and providing for an effective date."
10:13:18 AM
EMMA TORKELSON, STAFF, SENATOR JAMES KAUFMAN offered a
Sponsor Statement:
Alaska Housing Finance Corporation owns and operates
more than 1,600 units of public housing in 13
communities throughout the State. Anchorage serves as
the maintenance hub for all facilities and a staging
ground for both craftspeople and supplies heading to
other communities to perform repairs or training for
local employees.
For many years, Anchorage maintenance personnel have
relied on shipping containers at key housing
properties to meet storage needs for operations. In
the last several years, these containers have become
attractive targets for vandalism, break-ins, and theft
of equipment and materials. Similar issues and factors
such as supply chain issues and suppliers unwilling to
store materials for long periods of time have led to
other housing authorities and private property
management firms have begun to transition to ownership
of warehouse space to respond to the changing business
dynamics.
AHFC is in a position to purchase the building and
property at 700 Bragaw Street, which they have been
renting since September 2023. The location has class C
office space, a warehouse and fenced storage yard and
parking. Ownership will allow AHFC to build a housing
rental office on the property and better provide
warehouse space for equipment and materials storage.
Maintenance staff will benefit from the building's
adequate staging space and staff from around the state
will be able to meet in a single location for
training. In short, buying the property will help
address the maintenance needs of its aging housing
portfolio in Anchorage and allow them to more
efficiently plan and prepare for routine activities
and emergent needs in other communities.
AHFC's Public Housing Department has verified with the
U.S. Department of Housing & Urban Development that
federal funds available through AHFCs existing Moving
to Work Plan can be used to purchase the building with
proper reporting of expenditures. Together with the
sale of existing assets, AHFC has adequate funds to
address the purchase the facility.
Pursuant to statutory requirement in AS 18.56.090(d),
the legislative branch must authorize any property
purchase by AHFC. If approved by the legislature, and
following signature by the Governor, AHFC intends to
pursue acquisition of the property in 2024.
Ms. Torkelson displayed a document on the screen:
Timeline
September 2022
AHFC issues RFP inviting owners of Anchorage area
real estate to provide AHFC with a proposal to
lease a combination of office and warehouse with
a net useable combined space of 13,000 sq. ft.
October 2022
Responses were received
• One response offered for 700 Bragaw with
availability in October 2023.
• Offer accepted; Tenant Improvements commence
September 2023
AHFC took possession of the facility and began
paying rent.
October 2023
Move AHFC staff and materials from 1525 Boniface.
10:15:07 AM
Co-Chair Olson asked how the bill would alleviate the
vandalism problem.
10:15:36 AM
Ms. Torkelson replied that the facility would house the
shipping containers that were being vandalized.
10:16:10 AM
STACY BARNES, DIRECTOR OF GOVERNMENT RELATIONS AND PUBLIC
AFFAIRS, ALASKA HOUSING FINANCE CORPORATION, (AHFC)
explained the reason for the legislation. She stated that
taking ownership of the space would create new safety
opportunities for employees and the properties cared for by
AHFC. She said that the property was gated and had a fence
surrounding it. She shared that current public housing
assets were spread throughout the city. She explained that
the AHFC had been created by the legislature in 1971,
however, the Alaska State Housing Authority (ASHA) had
overseen public housing. In 1992 the ASHA portfolio was
brought within the AHFC, which now served 11,000 Alaskans.
Public housing was broken into two programs; a program that
offered housing vouchers for qualifying participants to
rent from private renter, and public housing, which offered
units owned by AHFC. She relayed that 1000 of the units
were outside of the Anchorage area. The corporation had
issued a request for proposal (RFP) to acquire a
maintenance space that was more acceptable for the
challenges faced by ageing housing stock. She referred to
the timeline on the slide. She listed the various ageing
public housing units in the state. She lamented that it was
taking longer to turn units and get new families into
housing.
10:20:29 AM
Ms. Barnes explained how to enhance the housing that was
managed and owned by AHFC. She explained that AHFC was
addressing the public housing work in Alaska in three
different ways; by putting more housing vouchers into
communities, by recognizing landlords participating with
the voucher program in the private sector and taking care
of already owned housing stock. She shared that public
housing units had to be used for storage and overflow,
which had led to vandalism of office space and vehicles.
She said that access to a hydraulic lift and loading
materials had allowed fort the distribution of Connex units
to be distributed in more remote areas of the state. She
elaborated on the various benefits of the purchase of the
warehouse facility. She spoke to the training
opportunities for 50 employees and pointed out that many
came in with specialized skills. She acknowledged that many
employees had to go into dark modular spaces to respond to
maintenance requests outside of general work hours.
Ms. Barnes relayed that there were federal funds available
for the project, and that AHFC was seeking $9 million for
the purchase. She mentioned removal of the temporary
storage units and modular spaces in Anchorage. She
mentioned the goal of broadening the vendor list. She
looked forward to greater collaborations with AVTEC, DPS,
and others that had expressed interest in collaborating
with AHFC.
10:25:03 AM
Senator Wilson pointed out that the building was built in
the 1970s, was formerly an athletic club, and had been
remodeled extensively. He asked whether the building would
be suitable for AHFCs current needs or if another building
would be better suited.
Ms. Barnes relayed British Petroleum (BP) was a recent
tenant and had made improvements that were appropriate for
further use by AHFC such as the hydraulic lift. She
asserted that the building was well outfitted to serve the
needs of AHFC.
10:26:57 AM
Senator Wilson wondered whether any of the other properties
near the building had been vandalized.
10:27:34 AM
Ms. Barnes responded that she was not aware of any damage
or vandalism in proximity of the building. She noted that
the building was close to many of the corporations public
housing units.
10:28:37 AM
BRYAN BUTCHER, CEO AND EXECUTIVE DIRECTOR, ALASKA HOUSING
FINANCE CORPORATION, ANCHORAGE (via teleconference),
reiterated the statements made by Ms. Barnes. He said that
the places they previously used for storage had been in
more remote, darker areas, more susceptible to break ins.
He contended that this new location was in a more well-lit
area, with fencing, and was less likely to be vandalized.
10:29:13 AM
Senator Kiehl asked how the building had been determined to
be the best facility in Anchorage. He wondered how many
RFPs had been issued.
10:30:23 AM
Ms. Barnes responded that the RFP had requested a minimum
of 13,000 square feet. She said that the corporation had
been intent on seeking a space that was near the housing
units managed by the corporation.
10:30:46 AM
Mr. Butcher furthered that the property had presented
opportunities that AHFC had not considered. He provided
examples of supply chain issues, and benefits to partners.
10:32:38 AM
Senator Kiehl appreciated the vision. He asked about the
shift from an Anchorage area maintenance facility to a
statewide facility. He queried the exclusion of certain
areas from the RFP and wondered whether all Anchorage
options had been considered.
10:33:25 AM
Mr. Butcher responded that there was a hope to keep the
facility near the AHFC units and be close to a bus route.
10:34:43 AM
Senator Kiehl considered that Anchorage was a pretty short
drive from Anchorage.
10:34:54 AM
Senator Bishop expressed excitement with the building
choice. He asked whether a savings factor had been applied
to the purchase of the property, given the centralized
location. He believed that building made sense for the
mission of the corporation. He wondered about incorporating
a childcare center for employees.
10:36:19 AM
Mr. Butcher responded agreed with Co-Chair Bishops
statements and reiterated that the facility would offer
numerous opportunities for the corporation. He offered to
provide numbers detailing the financial benefits to the
committee in the future. He believed that the new facility
would aide in recruitment and retention of maintenance
workers.
10:37:43 AM
Co-Chair Hoffman noted that the major facility would be in
Anchorage to service the 500-700 units in the area. He
asked that that Mr. Butcher provide information pertaining
to other goal pins throughout the state. He asked whether
an inventory of current public housing needs for the rest
of the state could be provided to the committee.
Mr. Butcher agreed to provide the information.
10:39:52 AM
Senator Kiehl noted that the building was assessed at $5
million and wondered why the request was for $9 million.
10:40:09 AM
Mr. Butcher responded that the hope was to come in under $9
million but the corporation did not want to underestimate
and come before the legislature in the future to ask for
additional funds.
10:40:40 AM
Co-Chair Olson looked at the fiscal note and remarked that
it did not provide numbers reflecting the savings that
would come from not having to pay rent on the facility. He
asked how much AHFC was currently paying in rent for their
maintenance and storage facilities.
10:41:02 AM
Mr. Butcher replied that the corporation currently paid
approximately $785,000 per year. He stated that once the
facility was up and running actual numbers of cost would be
made available to the committee.
10:41:45 AM
Co-Chair Olson wondered whether there would be a change in
the maintenance management and costs in the building once
it w3as owned by AHFC.
10:41:55 AM
Mr. Butcher responded in the affirmative and stated that it
was too premature to determine the actual numbers. He said
that AHFC had not spent even a year in the building yet.
10:42:34 AM
Co-Chair Olson queried the advantage of a fixed hydraulic
lift.
10:43:01 AM
Mr. Butcher agreed to provide that information.
10:43:14 AM
Ms. Barnes agreed to follow up on the question.
10:43:27 AM
Co-Chair Olson OPENED and CLOSED public testimony.
SB 205 was HEARD and HELD in committee for further
consideration.
ADJOURNMENT
10:44:15 AM
The meeting was adjourned at 10:44 a.m.